The half-year bank results season gets into full swing this week with figures from Barclays, Royal Bank of Scotland and Lloyds Banking Group.
Barclays will kick off half-year results from the major high street banks on Wednesday following reports it is planning to axe more than 30,000 jobs as it speeds up a cost-cutting strategy after firing chief executive Antony Jenkins.
Hands-on chairman John McFarlane, who has taken over at the helm until a replacement is found, will be looked to for further clarity on cost cutting and his aims for the business, while the group and its rivals will also be pressed for reaction to the Chancellor’s incoming new eight per cent surcharge on bank profits.
Mr McFarlane said Mr Jenkins was fired after lacklustre revenue growth as the banking giant’s shares remain at the level they were six years ago.
But it is thought a programme of further job losses will be one of the only ways to address the bank’s under performance and hit a target of doubling its share price.
The group’s interims are expected to show a drop in investment banking revenues - down nine per cent to £1.96 billion, according to Investec analyst Ian Gordon.
Morgan Stanley is forecasting group second quarter underlying pre-tax profits to rise five per cent to £1.7bn, but this would be a nine per cent drop on the previous three months.
Results so far in 2015 have been overshadowed by almost £1bn in extra provisions for mis-selling of PPI and its involvement in the foreign exchange scandal, which landed the bank with a £1.53bn fine by US and UK authorities in May.
Shareholders are keen to see Barclays return to its former glory, with speculation that a change at the top will herald a refocus on its investment banking business to drive profits once again.
Royal Bank of Scotland follows on Thursday amid speculation over the timing of the Government’s first move to sell off shares in the taxpayer-backed lender.