Barclays on Friday reported first-quarter net profit of £1.7 billion ($2.37 billion), helped by a fall in loan impairment charges.

The British bank said these charges had fallen “significantly” in the first three months of the year to £55 million — down from £2.1 billion in the first quarter of 2020.

Analysts had expected net income to come in at £1.3 billion for the first three months of the year, according to Refinitiv. The British bank posted net income of £220 million for the fourth quarter of 2020.

Barclays also reported a rebound in equity trading as stock markets recovered from their coronavirus-induced slump last year. Total income at its investment banking arm slipped 1% to £3.6 billion, but equities — up 65% in their best-ever quarter on a comparable basis — helped offset a 35% fall in fixed income, currencies and commodities income.

Other highlights for the quarter:

Revenues hit £5.9 billion, down from £6.3 billion a year ago.
Operating expenses hit £3.5 billion from £3.3 a year ago.
CET 1 ratio, a measure of bank solvency, came in at 14.6%, a fall from 15.1% last quarter.
“While momentum in the consumer businesses, particularly card balances, will take time to build, Barclays secured significant new growth opportunities in Q1 (first quarter),” Jes Staley, CEO of Barclays said in a statement.

Outlook
Going forward, the British lender expects costs to rise in 2021 compared to the previous year. This is on the back of coronavirus-related expenses, a real estate review, further structural cost action and higher pay.

“While evidence of recovery is encouraging, we have continued to take a cautious view of the impact of the pandemic on the business. We remain disciplined on costs, with a cost to income ratio of 61% this quarter,” Staley said.

Shares of Barclays are up about 31% since the start of the year.

Sudeepto Mukherjee, senior vice president at consultancy Publicis Sapient, said the bank’s results reflected a strong performance in the first quarter of 2021.

“This is largely thanks to their robust business model and strong CIB (Corporate and Investment Banking) performance. However, their consumer business still faces the headwinds of the Covid-19 pandemic which will likely continue throughout 2021,” he said in a note.