Barclays steps up provisions as pandemic hurts consumer business

British lender booked pre-tax profit for the first half of the year of $1.6bln

  
People queue at Barclays Bank in St Albans, as the spread of the coronavirus disease (COVID-19) continues, in St Albans, Britain, March 23, 2020.

People queue at Barclays Bank in St Albans, as the spread of the coronavirus disease (COVID-19) continues, in St Albans, Britain, March 23, 2020.

Reuters/Paul Childs

LONDON - Barclays set aside a higher than expected 1.6 billion pounds to cover a possible rise in loan losses in the second quarter of the year, as the economic impact of the coronavirus pandemic begins to bear down on its consumer business.

Barclays was expected to report credit impairment charges and loan loss provisions totalling 1.42 billion pounds for the April-June period, according to an average of analyst forecasts compiled by the bank.

That increase takes total provisions to 3.7 billion pounds for the half-year and analysts predict that sum to rise to 5.79 billion pounds for the full year.

The British lender booked pre-tax profit for the first half of the year of 1.3 billion pounds, down from 3 billion pounds a year ago as provisions against potential bad debts outweighed improved revenues from its investment bank.

The fixed income, currencies and commodities division was the top performer in the corporate and investment banking unit with a 60% increase in income to 1.4 billion pounds during the second quarter. The markets division posted a 49% rise in income to 2.1 billion pounds. ($1 = 0.7740 pounds)

(Reporting By Lawrence White and Sinead Cruise, editing by Iain Withers) ((lawrence.white@thomsonreuters.com; +44 207 542 6137; Reuters Messaging: lawrence.white.thomsonreuters@reuters.net))