Barclays (1K) | Buy | Q2 preview

Research evidence excerpt

Barclays (1K) | Buy | Q2 preview

7,137 8,381 9,407 Tangible BVPS 434.03 479.74 540.94

the consolidation of Best Egg. EPS adj. 52.70 65.16 78.66

The structural hedge continues to be a powerful tailwind. According to our Consensus EPS 52.32 63.31 73.31

estimates, in Q2, the average re-investment yield stood at 4.3% vs the FY to 31/12 (GBP) 12/26E 12/27E 12/28E

management assumption of 3.5%. P/E adj. and fully diluted(x) 9.6 7.8 6.4

P/BV (x) 1.2 1.1 0.9

May 2026 Industry data show a slowdown in mortgage approvals as well as a P/TBV (x) 1.2 1.1 0.9

slowdown in corporate lending (especially on the SME side). Term deposits have Dividend yield 3.0% 3.2% 3.5%

also progressed as depositors have shifted from instant access to benefits from RoTBV 12.5% 14.3% 15.4%

increasing fixed-term deposit rates. RoE after tax 10.9% 12.4% 13.5% CET 1 ratio 14.3% 14.0% 14.3%

We also look at what could be the impact of a Burnham's premiership for UK Cost income ratio 57.8% 55.5% 53.2%

banks (BOE reserves remuneration, Banking tax surcharge and change on the Net NPL ratio (on loans)

ring-fencing/pro-growth governmental stance) and conclude that we see limited Sector Most Pref. Sector Least Pref.

downside for UK banks at the moment. Barclays Banco BPM

Raiffeisen Bank International CaixaBank

Deconstructing the forecasts Santander Svenska Handelsbanken

We tweak our adjusted EPS forecasts by 1%/0%/+1% for 2026E/2027E/2028E,

respectively.

Valuation and investment conclusion

We raise our TP to 575p and reiterate our Buy rating.

Nicolas Payen

Equity Research Analyst

+44 (0)207 621 5128

npayen@keplercheuvreux.com

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