Barclays 'to post £7bn profits'

British bank Barclays will unveil its 2007 profits haul today after a testing year for the high street banking giant.

The group – the first of the “big five” to report figures for last year – is forecast to post profits close to last year’s record level, despite write-downs and bad debt provisions.

The credit crunch could see Barclays reveal further losses on top of its £1.3 billion (€1.7bn) write-down announced last November.

The bank may also show that it has set aside around £2.65bn (€3.5bn) to cover bad debts last year as its Barclaycard credit card business continues to see arrears.

However, shareholders are anticipating a potential 10% increase in the company’s dividend payment after reports suggested the hit would not be enough to derail its strategy.

Analysts are pencilling in a 2% dip in pre-tax profits to £6.99bn (€9.3bn) for 2007, against the £7.14bn (€9.5bn) reported in 2006.

Shares soared as much as 7% yesterday as investors anticipated a largely reassuring full-year report.

While some are predicting that Barclays’ write-downs relating to the credit squeeze and the meltdown of America’s sub-prime mortgage market may rise further, its investment banking arm is said to have been key in offsetting losses so far.

Barclays said in November that Barclays Capital had the best fourth quarter monthly income level in its history.