Barclays was upgraded to BBB+ from BBB by S&P citing its “business diversification and resilient performance”. Barclays has a “solid earnings outlook” given its strategic and geographical diversification alongside peaking interest rates. S&P expects the bank’s net interest margin to peak in 2023 and estimates a cost-to-income ratio of 61-63% across its 3Y forecast period. The rating agency also notes that Barclays has a strong and proactive risk management mechanism. Its liquidity buffer stood at over £122bn higher than the minimum regulatory requirement, with 82% of it in deposits with central banks and 18% in government bonds. S&P added that a further upgrade is unlikely in the next 2 years.

Barclays’ 4.375% Perp was up 1.2 points to 66.7, yielding 14% to its call date in March 2028.

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