Barclays Shares Take a Downward Dip—Like a Bad Haircut?
Barclays shares plummeted over 8% on Tuesday after the bank dropped its earnings and profit forecasts for Q3. It’s a rough tumble that sent the market shaking its head.
What the Numbers Say
- Pre‑tax profit for the three months to September: £1.9 billion – better than expected, but a bit shy of the £2 billion haul from last year.
- The bank has cut its profit outlook and will bring in some cost‑cutting moves.
CEO Venkat Gets Down to Business
CS Venkatakrishnan (a.k.a. Venkat) laid out plans to tighten the belt:
- “We’re trying to make, create, and run a more efficient organisation. Look everywhere for productivity boosts.”
- He added a promise for cost efficiencies and disciplined capital allocation to lift shareholder returns.
What About the Workforce?
Venkat hinted there could be global workforce adjustments, though no concrete job cuts were revealed. “We’ll modulate the size of our workforce,” he said, leaving the exact changes shrouded in mystery.
Interactive Investor’s Take
Richard Hunter, head of markets at Interactive Investor, pointed out some extra twists:
- Higher interest rates = higher savings returns, prompting customers to migrate elsewhere.
- Lower deposit volumes and mortgage margin pressure make the mix more difficult.
- Barclays has trimmed its NIM outlook to 3.05%–3.1% from a previously guided 3.2% (and a 3.22% performance in Q2).
So, while Barclays is working to tighten its belt and improve efficiency, it’s also navigating the tricky waters of higher rates and customer migration. Time will tell if the adjustments will bring back the confidence the market craved.
