The lenders released trading updates in which the effect of the pandemic was seen on profits.
Barclays ear-marked a total of £3.7bn for credit impairment charges for the six months to end of June while profit before tax sank 58 per cent to £1.3bn for the period.
The bank has provided 121,000 customers with mortgage payment holidays, and the average loan to value of new lending was at 68 per cent, the bank said.
Jes Staley, chief executive of Barclays, said: “This has been a period focussed on supporting our customers, clients and the UK economy through the Covid-19 pandemic – providing the people and businesses that we serve with a bridge to recovery in every way we can.”
Santander profits fall 74 per cent
Santander’s UK arm has booked £376m of credit impairment charges, as statutory profit before tax tumbled 74 per cent year on year to £147m in the three months to the end of June.
The bank said income had been further affected by reductions to the Bank of England base rate and regulatory changes to overdrafts.
However, the lender said it was confident in the “resilience” of its balance sheet, with its prime retail mortgage book averaging a loan to value of 42 per cent.
The bank had granted 239,000 customers mortgage holidays over the period, with 72,000 still outstanding as of 15 July.
Net mortgage lending is set to “be in line with the market”, as it focuses on customer service and retention.
Nathan Bostock, Santander UK chief executive, said: “The Covid-19 crisis has been a huge challenge for all of us and our top priority throughout has been the welfare of our people, our customers and the communities in which we operate.
“I am extremely proud of how our people have worked at extraordinary pace to substantially change the way we operate so we can continue to provide essential banking services for all our customers, despite the material impact the crisis has had on our business operations and our colleagues themselves.
“We understand how hard it has been for our customers and we have supported many thousands of individuals and businesses with a range of measures including payment holidays on mortgages, personal loans and credit cards as well as taking an active part in Government loan schemes to help businesses through these uncertain times.”
