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At last I do believe the tide is turning for the financial sector which I have some funds in .All my funds and share are in isas so no tax on profit or dividends.
Good budget for financials but not for taxpayers.
So this is in the statement so no direct change in the 3% levey but will pay more as Corp Tax increased
Bank Corporation Tax Surcharge - Following the decision to proceed with the Corporation Tax rate increase to 25% from April 2023, the changes to the Bank Corporation Tax Surcharge which are legislated to take effect from the same point will also go ahead. This means that from April 2023, banks will be charged an additional 3% rate on their profits above £100 million – meaning that they will continue to pay a higher combined rate of corporation tax than most other companies, and a higher rate than they did previously.
Actually it means the bank surcharge is being reduced from 8% to 3%, de;livering a net benefit to banks profit margins.
Https://www.cityam.com/government-slashes-bank-surcharge-in-boost-for-the-city/
As I see it Barclays (and the other banks) are seeing their tax rise to 28% - 25% Corp Tax and 3% surcharge tax. This was flagged up before the Autumn Statement/carefully leaked to the media. Previously the tax situation would have been 19% Corp Tax plus 8% surcharge tax. So a rise of 1% overall. That's pretty lenient considering. There are other taxes to factor in though.
Short-to-mid term - certainly until financial year end and maybe Q1 next year the future looks good even though we are in recession in the UK. Bear in mind that Barclays has good geographical diversification so isn't over reliant on the domestic market.
I think Barclays should be looking at rather more generous returns to shareholders. Although their profits have continued to impress, they have still not paid out the dividend that was cancelled with covid. What has happened to that? Anticipated profits after tax for the current year are in excess of £5bn after impairment provisions. A £2.5bn pay out, which should be achievable, would equate to a yield of 10% at the current depressed share price. They might be reluctant to pay out because of political fears etc but they need to bite that bullet. Share buy-backs only really count as a pay out at all to the extent they are larger than new share issuance. Sustainable and significantly more generous dividends should, if they come, prompt a re-rating. The fact it is only yielding around 3-4% at the current share price is frankly pathetic.
To badjob: Entirely agree with you. The dividend cancellation for Covid was a scandal, having gone ex-div. The bank deliberately hiding behind a Govt directive. But I see no reason, given that the losses didn't materialise, why the bank could not then have paid an extraordinary dividend to those holders who were entitled to the dividend in the first place. It was all too convenient for Barcs to hang on to the money. They are only interested in looking after those who run the bank and not those that own it. Even Staley pretty much said he felt embarrassed as to to how long-suffering Barc's shareholders were being let down and promised to rectify the situation with 'progressive dividends' (my ****) - he never did. And the buy-backs - don't get me started. What on earth has been achieved with the £2.5bn so far shelled out? The SP is still more than 20p less than it was when the buy backs began! And it sickens me how the bank points out what it thinks is an impressive Return on Equity rate, when it is based on the current and appallingly depressed SP. Dividend rewards are there for investors - I stress the word investors - the inference being long-term shareholders, some of whom (not me) will have bought in when the SP was nearly £8. Since those times, returns have been nigh on negligible in comparison to the sums they will have invested. It is so evident how difficult it is to shift the SP of this stock northwards and it is entirely down to how the bank has behaved over the last 15-20 years and how it has treated shareholders - it is the company not to trust. The only way they can start repairing the damage they have done is to now put shareholders first, but they have absolutely no intention of doing so.
Well one of the better moves I made was closing my second short at 154.7 yesterday at around £1500 loss. Can’t get them all right but happy to close a position I was clearly wrong about.
Will keep an eye on barcs as I still think my pessimism is justified but may take a bit longer than originally thought to filter through.
Or ofcourse I could just be wrong and this is going much higher, which in the short term does look to be the case.
Congratulations to all the longs and those making money of these swings, well played. Have a good weekend and ATB everyone
The Reducer , all you state I totally agree with. Didn't see the Directors taking a drop in their income during Covid , but we certainly were cheated out of dividends. I am making a small loss on my holding , but if and when it becomes a reasonable return on investment , I am out.
The Reducer, CEREUS and BadJob
The questionable aspect regarding the terminology over the timing of the ECB (Ole Costas H'O the clearing B) ordering / telling Sam Woods over here at the PRA / basically the curtain twitcher's at the BoE. "To postpone", no mention back then of cancel ! We were all within 48 hrs of the dividend going through . . . Great April fools joke that turned out to be, aye !
. . . In response to a request from the Prudential Regulation Authority (PRA) the UK’s seven largest banks are to suspend £15bn of dividend payments to shareholders and halt buybacks on ordinary shares until the end of 2020, and will also cancel payments of any outstanding 2019 dividends
The PRA wrote to HSBC, Nationwide, Santander, Standard Chartered, Barclays, RBS and Lloyds asking them to agree to publish a statement it had drafted.
This read: ‘In order to help us to serve the needs of businesses and households through the extraordinary challenges presented by Covid-19, the board has decided that until the end of 2020 we will undertake no quarterly or interim dividend payments, accrual of dividends, or share buybacks on ordinary shares.
‘In addition, in response to a request from the PRA and to preserve additional capital for use in serving our clients, the board has agreed to cancel payment of any outstanding 2019 dividend. Our board will decide on any dividend policy and amounts at year-end 2020.’
SO WHERE IS THE HALF OF 2018 THEY OWE EVERY SINGLE SHAREHOLDER FROM THE DATE PRO RATA, BEING THE LAST PAYMENT ?
After all they (Barclays) did swap from quarterly, to half yearly.
This still makes my p*** boil thinking about it, some on here are probably reading this, thinking its in the past, forget about it. If you are one of them thinking that, may I ask if you would feel the same way, if someone "stole" enough to buy a brand new family car from your bank account, because thats what they basically did to me in caparison.
Absolutely criminal what they Barclays did, like Reducer points out, "deliberately hiding behind a Govt directive". Which is exactly what they did.
Having gone at the BoE, PRA and Barclays they all refer back to the LSE and some paragraph about dividends.
Though the things that niggles me is that Barclays Nige Higgins)publicity said that they were well capitalised to pay the dividend, the 2nd clause was if the said company was going into liquidation and could not continue to operate.
SO NEITHER OF THE LSE RULES THEY ALL REFER TO APPLY , so where where is my pro rate EX dividend payments gone then Barclays ?
If anyone else gives 2 flying chuffs, maybe we can take a private action like they keep doing over the pond, currently claiming back lost shares holders money for incompetence regarding the over selling fiasco.
Crikey we are too soft and accepting in the U.K
Rant over ( Any mention of the div gets my hackles up)
Mr Wolf - a very fair rant. The keeping of the divi is even tougher to swallow when UK banks seem to trade at little more than 5 x PE compared to double that or more in the US. The low PE almost disguises the derisory dividend pay outs to shareholders. A 4-5% yield sounds respectable but is actually pathetic off such a low PE and suggests either a lack of confidence in the business or a desire to keep the money to ultimately reward themselves. I don't know which it is or what is actually happening to all the profits.
Fines and a very greedy BoD.
BARC historically only ever pays a divi of 3% max.
It rarely pays more to the shareholders but nearly always pays more to the management.
OH and it knows that there is nothing anoyone can do about it !
Good morning M1k3y and badjob.
That is what they want to happen, hoping everyone will just give up throwing the hot potato around.
What I find disturbing is the fact that we do not really live within a free society, in fact we adhere to rules set with striking similarity to the Marxist theory.
The british public are ruled under authoritarian statute (Our Gov' are a law to themselves) whom administer through centralism a single centralised party apparatus / the corporation.
How the heck can we the public live and vote, elect a party (Who are all a shower of ****) whilst they themselves abide by the rules set out, from within the square mile.
Without rattling on, does anyone reading this believe ole Risky and Hunt are running the show ?
Mr Wolf has always understood that the City Of London "The Corporation" runs the show.
Anyone ever heard the name Nicholas Lyons ? Well he is currently our public face for the "String pullers" in the UK.
Anyone who owns shares in the banking sector, should know who José Manuel Campa is.
He is actually the one who took over as Chair of the European Banking Authority (EBA) his predecessor Fat Boy Bailey shared many a pie with, the C.B sent out the order for Bailey and Woods, to screw over us share holders of our dividends. Some of you might be thinking "But we weren't in the EU since 2016"
Great Britain back in the day (commonwealth) started all these offshore financials in way of protecting the pound.
Eg. Places like Africa had a national debt of 10% of the value of the amount it generated / generates, which gets migrated out the country into the offshore hubs (set up by the UK & US corporation's and also China.
If enough investors rallied together and publicity causing enough noise, (having a case to answer) we might stand a chance. The closest I managed to get, was the "Stone Wall" perimeter of the BoE, realising the tight relationship they hold with the Corporation !
It does not matter if you invest your savings in $$atWest, Lloyds or Barclays, ect . . . at the end of the day our money is invested indirectly within the corporation.
In reality, we the public can not even get within a whisker of them, as we are outside their laws and statute (despite they are bang in the centre of London, UK)
Yes the "corporation" is above OUR law, they have their own. Fact not fiction.
As per DYOR this is not meant to come across as a furry rant, just to share with others, those who really control this country.
We the investors and british public are no more than blurting sheep.
Still sheep at the end of the day, just some are sheep in wolves clothing lol.
Having explained my reason for the under laying anger, having my dividend STOLEN, which it was, under our commercial laws, which in turn are based on common law . . . No I will not stop chucking that hot potato.
The US Thanks Giving this week, doubt we will see any needed volume until next week now.
GLA
Barclays has a progressive dividend policy. What that means is dividend would be increased progressively. Half year '21 had a dividend of 2p per share. Half year '22 had a dividend of 2.25p.
Full year 2021 had a dividend of 4p, so dividend in Feb should be 4.25p.
Not sure where is the 3p dividend talk coming from? Progressive dividend policy would mean dividends increase every year. And with every buyback program there will be lower shares in circulation, and even if the dividend amount paid stays the same, the dividend per share should increase. At least Barclays has a progressive dividend policy - Lloyds doesn't have a progressive dividend policy. And Barclays share buybacks are able to buy shares at a much lower price than its TNAV per share of 289p vs where Lloyd's can buyback.
No wonder Barclays share price hit a 52 week high of 219p earlier this year, before the securitisation goof up and the war derailed the trajectory. The securitisation effect is falling off with each quarter and if the war ceases then 219p could be hit again fairly soon imo. And look at the sensitivity slide that Barclays had at their Q3 results - a 25bps increase in interest rates has a very sizable impact in Barclays income vs say Lloyds. The higher interest rate income is starting to filter through - that's what the market saw in driving the share price to 219p level in Jan '22. Do you see similar upside with Lloy or nwg?
The below extract is from the Q3 '22 results;
"Capital returns: capital distribution policy incorporates a progressive ordinary dividend, supplemented with buybacks as appropriate. Dividends will continue to be paid semi-annually, with the half year dividend expected to represent, under normal circumstances, around one-third of the total dividend for the year"
So if 2.25p per share dividend that was paid at Half year results is one-third, then the remaining would imply a dividend of 4.5p in Feb '23 during the Full year results?
Sean. I am actually hoping for 5p in the full year results.
The share price movement at Virgin Money shows the impact of a decent hike in the dividend - up over 20%. I expect that Barclays will once again be more conservative in their pay-outs to shareholders. Based on past practice, they are more likely to disappoint than pleasantly surprise. Anything less than 4.5p for the final dividend will be poor in my view. Even that only gets up to a 4.3% yield on a pretty bombed out share price.