Main players banking on huge profits

BARCLAYS and Lloyds Banking Group are set to report massive hikes in their first quarter profits this week, due to the stronger than expected state of the economy.

Twelve months ago, Britain’s banks put aside more than £6billion to cover losses on loans that they feared would go sour because of the economic impact of the pandemic.

However because they have not had to set aside as much money this quarter to cover Covid-19 affected loans, Lloyds and Barclays are tipped to report sharp increases in their profits on Wednesday and Friday at their respective results.

Lloyds is expected to say that its pre-tax profits have risen from £74million to £1.1billion, while Barclays is likely to report that its profits have risen 82 per cent to £1.6billion. Both have benefited from the strong mortgage market. Barclays is also likely to say that its investment bank put in a strong performance.

Similarly, rivals HSBC and Natwest are tipped to report increased profits at their results on Tuesday and Thursday. HSBC’S profit for the quarter is expected to be $3.3billion (£2.4billion), an increase of 3.6 per cent. Natwest’s profits could be 9.4 per cent higher at £568million.

Elsewhere, the City expects BP and Royal Dutch Shell to say the recovery in the crude oil price has restored their profitability at their first quarter results. On Tuesday, BP is tipped to report a net profit of £2.1billion for the first three months of 2021, versus a £3.5billion loss last year. Shell is set to announce a profit of £2.9billion, versus a £19million loss.