Mixed NIM Dynamics for Barclays in 2023 Results in Cautious Guidance

No-moat Barclays reported fourth-quarter profit before tax of GBP 1,310 million, down 8% versus the same period a year ago. Total income grew 12% to GBP 5,801 million, driven by 16% growth in Barclays U.K. and 46% growth in consumer, cards, and payments. Loan losses of GBP 498 million were slightly elevated as the macroeconomic outlook deteriorated further in the quarter. For 2023, the bank now guides for loan losses of 50 basis points to 60 basis points, approaching the 70 basis points we assume as a midcycle loan-loss ratio for Barclays. We maintain our GBX 208 per-share fair value estimate.