The Beeb was so excited tonight at having a S C O O P by persuading
the great Joanna Lumley to beard Mr Woolas, immigration minister, in
an unscheduled debate with the cameras right up the nostrils of two
contenders that it got the real story of the night absolutely wrong.
It put out an absurd, wildly over-optimistic, story about how well
the banks are doing, amd how the banking crisis may be over. But
the facts they based their story on are precisely those in the
Financial Times (and the rest of the financial press) who
surprisingly didn't get it wrong too!
The BBC 6 o'clock was armed with the usual expensive graphics and
commentator who radiated good cheer while the world was actually
falling apart. Heigh Ho!. Robert Peston came in at the end and was
clearly bemused by what was going on in the studio but managed to
spoil the party at the end by pointing cold water on the party by
pointing out that (a) the banks are not out of trouble, and still
losing money ; and (2) that even if the banks were a bit better the
recession is going to get worse.
Heigh-Ho What IS the BBC for ?
xxxxxxxxxx cs
PS Lumley won and was none to pleased to find that all Mr Woolas's
and Brown's promises boiled down to was an undertaking to "review
the matter. She was not inconsiderably displeased.
=========================================================
Lloyds Banking Group, the rival UK bank, also said on Thursday that
it expected its impairment charges on corporate loans to rise by more
than half in 2009 as a result of economic weakness.
The disclosures come amid concern that banks' activities in the "real
economy" might displace investment banking as a source of woe this year.
Barclays, which had previously announced a strong start to 2009, said
first-quarter pre-tax profit rose 15 per cent to £1.37bn. Income
increased 42 per cent to a record £8.15bn.
Analysts at Credit Suisse said pre-tax profit was "a little less than
we had hoped for", but added that they were nonetheless minded to
increase their 2010 profit forecast for the financial services group.
Barclays shares, which had plummeted to little more than 50p in
January, continued their upward trajectory, rising 11/4p to 2891/4p
in afternoon trading, but Lloyds plunged 6.8 per cent to 1051/2p.
Barclays' first-quarter profit increase was driven, as expected, by
strong growth at Barclays Capital, its investment banking arm, where
pre-tax profit rose 361 per cent to £907m, partly because of the
acquisition of Lehman Brothers' US arm, which accounted for about one-
third of BarCap's income over the period.
However, BarCap's strong profit performance was offset by the
commercial and retail banking arm, whose profits fell 45 per cent to
£586m, even though income rose 16 per cent.
The profit decline was partly due to higher impairment charges linked
to increased delinquency on consumer loan and overdraft payments in
the UK. Impairment charges also rose sharply in its commercial
banking operations, "tracking trends in corporate performance", as
Barclays put it.
They also surged at its Barclaycard credit card unit, where credit
limits have been cut and new borrowing refusals have increased.
Across the group as a whole, impairment charges were £2.3bn, up from
£1.3bn in the first quarter of 2008, although Barclays said this was
not unexpected. To a large extent, the rise reflected ongoing credit
market writedowns, increased lending and currency movements.
In February, Barclays had said that it expected an annualised loan
loss rate for 2009 equivalent to between 1.3 per cent and 1.5 per
cent of its portfolio, compared with 0.95 per cent in 2008. It said
it now expected the eventual 2009 figure to be at the higher end of
this range.
In its own, much-briefer trading update, Lloyds blamed "rising
unemployment, reduced corporate cash flows, the continuing impact of
lower house prices and falls in the value of commercial real estate"
for the significant rise in impairment levels in its lending portfolios.
It anticipated further corporate defaults during the rest of the
year, notably in British and Irish commercial real estate. It also
reiterated that it expected to report a pre-tax loss for 2009.
Alex Potter, a Collins Stewart analyst, said that Lloyds could
conceivably be loss-making for the coming 18-24 months.
Barclays' profits included an accounting gain of £279m that actually
arose from a decrease in the traded value of its own debt. However,
this was less than the £703m it booked in this fashion in the first
quarter of 2008.
Trading in April had been generally in line with February and March
as opposed to the exceptionally-good performance in January, Barclays
added
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