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Barclays crushes expectations for the third quarter as provisions for mortgage losses fall

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Barclays Bank building

Chris Ratcliffe | Bloomberg | Getty Images

Barclays on Friday reported a net profit of £611 million ($797.7 million) for the third quarter, as the British lender attempts to plot a recovery from the coronavirus pandemic.

The improvement, which more than doubles analyst expectations of £273.5 million, comes in part due to a sharp reduction in coronavirus-related impairment charges.

In the first half of 2020, the British lender posted a net income of £695 million after adding another £1.6 billion of loan loss provisions in the second quarter.

This time around, cash set aside to accommodate bad loans amounted to just £608 million.

Other highlights:

Common equity tier one capital (CET1) ratio was 14.6%, up from 14.2% at the end of the first half.Group income hit £5.2 billion.

The bank reported a net loss of £292 million for the same period in 2019 after being hit by $1.4 billion ($1.8 billion) worth of insurance claims.

Major lenders have generally surprised to the upside so far this earnings season, with UBS easily surpassing expectations earlier this week to post a net income to $2.1 billion.

Barclays shares are down more than 42% since the turn of the year.

This is a breaking news story, please check back later for more.

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Katherine Clark