Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

StockBeat: Glasses Half Full at Barclays, Credit Suisse

Stock MarketsFeb 18, 2021 10:22
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters.

By Geoffrey Smith -- ‘Diversity is strength’ appears to be the main takeaway from the current quarter of bank earnings in Europe.

The message was driven home again on Thursday by Barclays PLC (LON:BARC) (NYSE:BCS) and Credit Suisse (SIX:CSGN) Group, both of which reported better-than-expected results for the fourth quarter, albeit the latter’s reports also showed that the benefits of diversification come at a cost too.

The U.K.-based bank became the latest to announce the resumption of shareholder payouts, with a 1 penny cash dividend and a further 4 pence of share buybacks worth a total of 700 million pounds ($974 million).

Together with similar announcements from the likes of BNP Paribas SA (PA:BNPP) (OTC:BNPQY), Unicredit (MI:CRDI) and Santander (MC:SAN) over recent weeks, that shows that the fog of Covid is gradually lifting, even though the slow pace of vaccine rollouts in the Eurozone mean that recovery there will be delayed by three months or more.

Credit Suisse’s results were - as always - more idiosyncratic, a comment on its own ability to get itself into and out of trouble. The bank swung to a fourth-quarter loss of 353 million Swiss francs thanks to losses on a New York hedge fund and a whopping 757 million litigation charge for past misconduct.  Strong performances in markets and in the key wealth management division helped rescue the quarter.

As with Barclays, the numbers were generally better than expectations, despite falling short of year-earlier comparisons. And as with Barclays, Credit Suisse did well in 2020 by hanging on to its investment banking division, whose trading and syndication performance helped offset the dismal performance of retail and commercial banking in a world of low or sub-zero interest rates.

Barclays’ investment bank revenue rose 22% last year, its best performance in six years, on the back of sustained high levels of volatility in markets. Shareholders will be relieved that they resisted the campaign by activist investor Edward Bramson (generously funded by Barclays’ rivals on Wall Street) for Barclays to ditch an arm that has provided a vital source of profit in an extraordinary year.

For sure, Barclays and Credit Suisse won’t be able to count on rivals continuing to pull out of investment banking at the same pace as they have in recent years. But even so, Barclays CEO Jes Staley was confident enough to push back against suggestions that the returns are likely to prove volatile.

Global capital markets have doubled in size in the last decade, creating a larger pool of activity, he told Bloomberg TV.

“There will be more consistency to the investment banking results than some people might speculate,” Staley said.

Barclays (LON:BARC) shares in London were still down 3.4% in London by mid-morning, while Credit Suisse (SIX:CSGN) shares were down 1.1% amid broad declines in European markets.


StockBeat: Glasses Half Full at Barclays, Credit Suisse

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email