Barclays Lifts RoTE Guidance, Announces £500M Buyback

Barclays (LON: BARC) experienced a strong Q3 performance, leading to upgraded guidance for 2025 and the announcement of a £500 million share buyback program.

Income: Barclays reported a 9% year-on-year increase in Group income for Q3 2025, reaching £7.2 billion. Year-to-date income stands at £22.1 billion, an 11% increase compared to the same period last year.

Profit & Margins: Q3 2025 saw a Group return on tangible equity (RoTE) of 10.6%, with the year-to-date RoTE reaching 12.3%. The cost-to-income ratio improved to 59% year-to-date, driven by positive operating leverage.

Cash & Balance Sheet: The bank's Common Equity Tier 1 (CET1) ratio stands at 14.1%, demonstrating a strong capital position. Tangible net asset value (TNAV) per share has grown to 392p.

The £500 million share buyback, brought forward from full-year distribution plans, highlights Barclays' robust capital generation.

The bank also intends to move to quarterly share buyback announcements, reinforcing its commitment to returning capital to shareholders. This is part of a larger plan to return at least £10 billion of capital between 2024 and 2026, subject to regulatory and board approvals.

Driver Breakdown:

• Income Growth: Barclays UK and Barclays UK Corporate Bank saw income increases of 16% and 17%, respectively, driven by structural hedge income and higher deposit and lending balances.
• Investment Bank Performance: The Investment Bank's income rose by 8%, supported by growth in Global Markets and Investment Banking, particularly in Financing and International Corporate Bank.
• US Consumer Banking: Barclays US Consumer Bank experienced a 19% income increase, reflecting repricing initiatives, business growth, and the acquisition of the General Motors co-branded cards portfolio.

CEO C. S. Venkatakrishnan commented, “I continue to be pleased with the ongoing momentum of Barclays' financial performance over the last seven quarters… We are therefore upgrading our 2025 RoTE guidance to greater than 11% and reaffirming our 2026 target of greater than 12%.”

Despite an additional charge for motor finance redress of £235 million in Q3 2025, increasing the total provision to £325 million, Barclays remains optimistic. The charge relates to a proposed Motor Finance redress scheme by the UK Financial Conduct Authority (FCA).

Barclays' strong balance sheet, with a CET1 ratio of 14.1%, positions it well for future growth and capital returns. The bank is also focused on cost discipline, achieving its targeted FY25 cost efficiency savings of approximately £500 million one quarter earlier than planned.

Barclays plans to announce new financial and operational targets through to 2028 at its FY25 Results on February 10, 2026, setting the stage for continued performance improvements.

The bank is upgrading its 2025 Group RoTE guidance to greater than 11% from approximately 11% and its 2025 Group net interest income (NII) excluding Barclays Investment Bank and Head Office to greater than £12.6 billion from greater than £12.5 billion.