On a quarterly basis, this was a £500m rise to its net mortgage balance.
Its profit before tax fell to £1.21bn in H1, down from £1.5bn last year, which it said reflected the one-off credit impairment release in the year prior. In H1 2021, the bank released £443m in credit impairments while this year it saw £51m in charges.
Barclays said this was down to low rates of arrears, improved employment in the UK and reduced uncertainty around Covid-19 being offset by rising concerns around customers’ vulnerability to high inflation.
In Q2, its profit before tax fell from £1bn last year to £600m.
It said mortgage arrears were at “multi-year lows” making up 0.1 per cent of its portfolio, which was flat on last year.
The group’s total income rose by seven per cent to £3.39bn. It attributed this to a 12 per cent rise to £2.19bn in income from its Personal Banking business, driven by increasing interest rates and strong mortgage origination in 2021. It said the strength of mortgage origination was partially offset by squeezed margins.
Its net interest margin increased nine basis points quarterly to 2.71 per cent, owing to higher rates and partially offset by mortgage margin compression. For the full year, net interest margin is expected to sit between 2.8 and 2.9 per cent.
Barclays said it was “well positioned” for a rising rate environment because of its deposit balances.
Its new home loan bookings stood at £14.1bn for the six months to 30 June 2022, down from £19.1bn during the same period last year.
Some 2.9 per cent of these new mortgage bookings are at loan to value (LTV) tiers 90 per cent or lower, compared to a proportion of 0.9 per cent last year.
The average LTV of Barclay’s mortgage portfolio is 50.8 per cent, flat on the year before.
Buy-to-let mortgages represent 12.8 per cent of its portfolio. It said its acquisition of Kensington Mortgages would extend its customer base through specialist lending by widening its capabilities and product offering.
The acquisition is still subject to regulatory approval and is expected to complete late 2022 or early next year.
Barclays issued nearly 3,000 green home mortgages in H1 at a value of £700m.
