Barclays reported second-quarter profits before tax of GBP 2,484 million, 11% above consensus estimates. Good performance in the UK corporate bank and investment bank led to a 3% above-consensus total income. Barclays aims to reduce capital weighting towards the investment bank by growing its UK noninvestment banking business.

The UK corporate bank saw growth in transaction banking and lending, with lending balances increasing by 9% year over year. The structural hedge is stabilizing net interest income performance, with gross incomes of the hedge above 2024 levels for the next two years. This supports the net interest margin.

Morningstar maintains a fair value estimate of GBX 306 per share and a no moat rating for Barclays. The author or authors do not own shares in any securities mentioned in the article.

Read more at Morningstar: Investment Bank and Corporate Bank Shine