Barclays PLC (BARC · LSE)
A High Street Bank With a Wall Street Engine
Barclays runs everyday banking for more than 20 million UK customers while also operating one of the few non-American investment banks with real scale in New York and London.
Bull case for Barclays PLC
Two engines that rarely stall together
Retail and investment baking tend to earn well at different points in the cycle.
Interest rate hedge locks in future income
As older hedging contracts signed at low rates expire, they are being replaced by new ones at higher rates, with the extra income locked in.
US card arm runs without branches
A branchless American card and deposit business is a low-cost line that further diversifies revenue.
Bear case for Barclays PLC
Trading income swings with market activity
Markets and dealmaking fees rise and fall with client activity the bank cannot control.
Deposit competition squeezes UK lending margins
Savers chasing better rates force the bank to pay more for the money it lends.
Rule changes force more capital aside
New capital rules require billions more set aside, limiting how much cash can be returned.