Britain's Barclays said it saw 'very strong profit momentum' in the first quarter as its UK retail bank improved and its investment bank beat peers, but weakness in the UK unsecured debt market weighed on Barclaycard.
'Barclays performed very strongly in the first quarter. High levels of activity with our customers and clients enabled us to deliver excellent profit growth,' CEO John Varley said in a statement.
Barclays said it expected 2006 income, impairment and expenses to be significantly ahead of consensus for the full year, with the rate of income growth 'broadly in line' with the rate of expense growth.
The bank said its Barclays Capital arm, which represents roughly a quarter of earnings, delivered 'excellent growth' in income and profit, performing at the top end of its peer group.
European investment banks have posted record results for the first quarter.
But Britain's biggest credit card lender said last year's trends continued at Barclaycard, with strong income growth offset by higher impairment charges in UK credit cards, consumer loans and investment in the business. Barclays said in the same quarter a year ago that bad debts were rising ahead of previous guidance.
Britain's third biggest bank kicked off a series of trading updates from the country's main lenders by saying income at its core UK retail bank grew faster than the rate achieved for the full year 2005.
Its UK Business Banking performed 'satisfactorily', the bank said, adding it was on track to report a two percentage point cost/income ratio improvement in UK banking in 2006.
