Broker snap: Investec upbeat about Barclays but obstacles remain

Barclays was performing well on Wednesday morning after Investec hiked its target price from 260p to 285p and hailed the lender as its 'preferred UK domestic bank'. Despite an impressive 79% rally over the past five months, the broker said that the shares are still trading "only in line with loss-making RBS and at a peculiar discount to Lloyds". These latter two banks are rated 'sell' by Investec."However, while recent operational performance has met or exceeded market expectations, and we certainly make no downgrade to our own underlying earnings forecasts, wider obstacles to further progress remain," said analyst Ian Gordon.He said that he is uncomfortable with calls from Bank of England financial stability director Andrew Haldane for the removal of flexibility from the Independent Commission on Banking's ring-fencing proposal - "flexibility that we see as critical to any palatable implementation of the infamous Vickers report". Meanwhile, Gordon said that demands in the Parliamentary Commission on Banking Standards' First Report to "electrify the ring-fence" are also unhelpful.BC