Barclays UK Income Surges 16% Post-Tesco Bank Deal, Challenges FCA Compensation Plan

Barclays' UK division booms after Tesco Bank deal. Bank joins peers in questioning FCA's compensation plan, despite strong overall financial performance.

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2025 October 22 . 2:03 PM

1 min read

In this image I can see it looks like an advertisement, on the right side there is the car in... — In this image I can see it looks like an advertisement, on the right side there is the car in yellow color, in the middle there is the text in black color.

Barclays UK Income Surges 16% Post-Tesco Bank Deal, Challenges FCA Compensation Plan

Barclays' UK division has seen a significant boost, with a 16% income increase following the acquisition of Tesco Bank. Despite this, the bank has joined other lenders in challenging the Financial Conduct Authority's (FCA) proposed compensation scheme, arguing it does not accurately address actual losses or achieve a proportionate outcome.

Barclays' group chief executive, CS Venkatakrishnan, has reported that the bank's financial performance has shown momentum over the last seven quarters, driven by stable income and efficiency savings. This positive trend is reflected in the US consumer banking operation, which saw income soar 19% in the third quarter.

Excluding the impact of a car finance provision, Barclays' pre-tax profit would have risen 4% year-on-year. The corporate and investment banking divisions also delivered strong results during the quarter.

However, Barclays' third-quarter pre-tax profit dropped 7% to £2.1 billion due to an additional £235 million provision for historic car loan compensation. The bank has increased its total motor finance provision to £325 million, up from an initial £90 million reserve. Barclays, along with other banks such as Deutsche Bank and HSBC, continues to challenge the FCA's compensation proposals.