Barclays Banks Surging First-half Profit

British bank Barclays said Wednesday that first-half net profits surged on lower-than-expected credit losses, as the global economy shows signs of recovery from the pandemic.

Profit after tax soared to £3.8 billion ($5.3 billion, 4.5 billion euros) in the six months to the end of June, compared with £695 million for the same period of 2020, Barclays said in a results statement.

The lender's performance was boosted after it released credit loss provisions of £700 million.

That compared with a vast impairment charge of £3.7 billion, made last time around to deal with anticipated Covid fallout.

The move was "driven by an improved macroeconomic outlook, lower unsecured lending balances and a benign credit environment", the financial giant said.

Pre-tax profit almost quadrupled to £5.0 billion, but revenues slipped 3.0 percent to £11.3 billion.

The lender will pay an interim dividend of 2.0 pence per share and also outlined plans for a £500-million share buyback.

"Barclays has had a strong first half of the year," said chief executive Jes Staley in comments accompanying the earnings.

"We are... seeing signs that the global economy is recovering.

"We have reported robust revenues and profitability and I am optimistic about our prospects to grow our business further."

The outlook also improved after the full reopening of England's economy on July 19.

Staley added Barclays was "starting to see the resurgence of activity across our businesses".

The bank however remains cautious amid ongoing global fears over the fast-spreading Delta variant of the coronavirus.

"Whilst the macroeconomic environment has improved, the outlook remains uncertain and subject to change depending on the evolution and persistence of the Covid-19 pandemic," it added.

In reaction to the earnings, the company's shares rallied 4.0 percent to 176.22 pence in morning deals on London's flat stock market.

"These look a decent set of numbers, with the investment bank doing most of the heavy lifting, while... UK businesses and consumers come across as somewhat cautious in their spending patterns," said CMC Markets analyst Michael Hewson.

Barclays again stressed its commitment to achieve net zero carbon emissions across its investments by 2050.

"We continue to drive hard on our ambition to be a net zero bank," said Staley.

However, the UK banking sector has faced harsh criticism from climate change campaigners over the financing of high-polluting coal projects.

Barclays, HSBC, Lloyds, NatWest and Standard Chartered provided $56 billion (46 billion euros) to coal firms over two years to late 2020, according to recent research from campaign group Reclaim Finance.