BCS changes
Pick any two versions below to diff them.
- Price
- $22.89
- Discount category
- Below intrinsic value
- Next earnings
- 2027-02-09
- Next earnings is estimate
- Yes
- Company name
- Barclays
- Sector
- UK banking
- About
- Barclays is a British bank. It has five businesses: Barclays UK, Barclays UK Corporate Bank, Barclays Private Bank and Wealth Management, Barclays Investment Bank and Barclays US Consumer Bank. The Investment Bank is the largest, with income of £11.1 billion in the first nine months of 2026, out of total income of £23.9 billion. The US Consumer Bank issues partnership credit cards and, since 2026, owns Best Egg, a personal loan platform. At September 30, 2026, total assets were £1,737.6 billion. The NYSE-listed BCS shares are American Depositary Shares, and each one represents four ordinary shares. The bank reports in pounds sterling.
- Thesis
- The market prices Barclays for its large investment bank and for its history of low returns. The Investment Bank earns most of the income, and its income moves with markets: in Q3 2026, FICC income fell 19% while equities income rose 47%. The group return on tangible equity was 11.3% in 2025, and the Q3 2026 return was 11.7%. Barclays also faces costs from the UK motor finance redress scheme, for which it holds a provision of £430 million, and higher capital needs under Basel 3.1 from January 1, 2027. For the gap to close, three things must be true. The return on tangible equity must be above 12% for 2026 and rise toward the target of more than 14% for 2028. Total costs must fall to about £18.4 billion in 2027 while income grows, so that the cost to income ratio falls to the low 50s. Barclays must return more than £15 billion to shareholders from 2026 to 2028 and keep its CET1 ratio in the 13% to 14% range. The full year 2026 results on February 9, 2027 give the next test. If these checks pass, the gap can close over the next one to two years. The main reason it may not close is a weak market for the Investment Bank or higher credit losses in UK and US consumer loans.
- Risks
- Investment banking income depends on markets. The Investment Bank had 47% of group income in the first nine months of 2026. FICC income fell 19% in Q3 2026. A weak market can lower income quickly, while costs stay high. UK motor finance redress. Barclays holds a provision of £430 million. In Q3 2026, the Upper Tribunal suspended parts of the FCA redress scheme after four legal challenges, which it hears in Q1 2027. The final cost and timing can change. Consumer credit. The US Consumer Bank and UK cards are exposed to a weaker consumer. Barclays expects a group loan loss rate near the top of its 50 to 60 basis point range for 2026, and the US Consumer Bank return fell to 10.9% in Q3 2026. Regulatory capital. Basel 3.1 adds £8 billion to £15 billion of risk-weighted assets on January 1, 2027, or 30 to 55 basis points of CET1. A move of the US cards to internal models adds about £11 billion more in the second half of 2027. These changes can reduce share buybacks.
- Balance sheet
- Barclays funds itself with customer deposits, wholesale debt and repos. At September 30, 2026, deposits at amortised cost were £599.3 billion and loans at amortised cost were £454.5 billion, a loan to deposit ratio of 76%. Wholesale funding without repos was £229.5 billion. The liquidity pool was £372.2 billion, the liquidity coverage ratio was 157.0% and the net stable funding ratio was 135.8%. Capital is the real limit for a bank. The CET1 ratio was 14.2%, above the target range of 13% to 14%, on risk-weighted assets of £369.8 billion. The UK leverage ratio was 4.9%. The MREL ratio was 35.2% against a requirement of 30.5%. Tangible net asset value per share was 410p, on 13,379 million shares. Barclays expects its Pillar 2A requirement to fall by 59 basis points, which lowers its MDA threshold from 12.2% to 11.6%. As of 2026-09-30.
- Checkpoints
- Feb 9, 2027 (estimate): Full year 2026 results: return and capital returns. Pending. Watch: A 2026 return on tangible equity above 12%, total costs of about £18.5 billion and a confirmed 2027 cost target of about £18.4 billion pass; a missed return target or lower capital returns fail. Q1 2027 (estimate): Upper Tribunal hearing on the motor finance redress scheme. Pending. Watch: A ruling that keeps the cost within the £430 million provision passes; a ruling that makes Barclays add a large new provision fails.
- Recent events
- 2026-10-22: Barclays reported Q3 2026 results. Income rose 3% to £7.4 billion, profit before tax rose 12% to £2.3 billion and EPS rose 18% to 12.3p. The return on tangible equity was 11.7%, and 13.8% for the first nine months. Equities income rose 47%, but FICC income fell 19%. The CET1 ratio was 14.2%. Barclays announced a share buyback of up to £500 million and said that it expects total costs of about £18.5 billion in 2026 and about £18.4 billion in 2027. 2026-07-28: Barclays reported first half 2026 results. In Q2 2026, profit before tax rose 31% to £3.3 billion and the return on tangible equity was 16.1%. Barclays raised its 2026 group income target to about £31.5 billion and announced a share buyback of up to £1.0 billion and a half-year dividend of 5.9p. 2026-07-28: The half-year report showed the first results of Best Egg, a US personal loan platform that Barclays agreed to buy for $800 million in October 2025. The US Consumer Bank also booked a gain of about £225 million from the sale of the American Airlines co-branded card portfolio. 2026-04-28: Barclays reported Q1 2026 results and announced a share buyback of up to £500 million. In Q1 2026 it added £105 million to its provision for the UK motor finance redress scheme. 2026-02-10: Barclays reported 2025 results, with a return on tangible equity of 11.3%. It set new targets for 2028: a return on tangible equity of more than 14%, a cost to income ratio in the low 50s and capital returns of more than £15 billion from 2026 to 2028.