KBRA Affirms Ratings for Barclays Bank PLC
8 Aug 2025 | Dublin
KBRA Europe (KBRA) affirms the deposit and senior unsecured debt ratings of A+ and short-term deposit and debt ratings of K1 for Barclays Bank PLC, a subsidiary of Barclays PLC (LON: BARC) (“Barclays” or "the group"), an international financial institution. The Outlook for the long-term ratings is Stable. The ratings are in support of a KBRA public finance transaction.
| This credit rating is an unsolicited credit rating. | |
|---|---|
| With Rated Entity or Related Third-Party Participation | Yes |
| With Access to Internal Documents | No |
| With Access to Management | No |
Key Credit Considerations
The ratings are based on KBRA’s view that Barclays is well positioned to deliver sustainable earnings. Its strong earnings profile enables it to absorb exceptional charges—such as conduct costs, restructuring, or redundancy expenses—as seen in recent years, although KBRA does not expect such charges to persist in size or frequency. Barclays’ diversified model—anchored by a strong UK retail and commercial franchise, a targeted US consumer platform, and select global investment banking operations—has demonstrated resilience amid ongoing macro and geopolitical headwinds. However, its US credit exposures introduce vulnerabilities amid continued market volatility. The group's sound capitalisation, strong liquidity and healthy asset quality also support the ratings. Barclays’ solid funding profile benefits from its strong deposit base, although there is considerable reliance on wholesale funding for investment banking operations. Asset quality remains sound. While anticipated interest rate cuts may support borrower affordability, credit card deterioration is expected in the UK and US amid persistent cost-of-living pressures. That said, KBRA expects the deterioration to be manageable due to the group’s conservative underwriting standards and prudent provisioning levels. The ratings are constrained by sizable earnings from investment banking, a core but inherently more volatile and risk-intensive business. As of 1H 2025, Barclays had delivered £17 billion of its £30 billion UK risk-weighted assets (RWAs) growth target, including £10 billion organically, while aiming to reduce RWAs of its investment banking business to ~50% of group RWAs by 2026.
Rating Sensitivities
A rating upgrade is not expected in the near to intermediate term. However, a sustained improvement in earnings, while maintaining healthy asset quality and strong capital could facilitate positive rating momentum over time. A rating downgrade is also unlikely in the medium term, though a severe and/or prolonged setback in the economic recovery or material weaknesses in risk management leading to a substantial deterioration in asset quality, earnings, or capital, may result in negative rating action. The ratings are also sensitive to the economic impact of Brexit.
To access ratings and relevant documents, click here.