London, Jan 13, 2026, 08:20 GMT — Regular session
- Shares in Barclays climbed 1.7% in early London trading, bouncing back from Monday’s policy-fueled drop.
- Investors are grappling with the potential impact of a proposed U.S. cap on credit-card interest rates, a crucial profit driver for the bank.
- Barclays revealed an additional block of buyback shares set for cancellation.
Barclays PLC shares BARC.L jumped 1.7% to 481.2 pence in early Tuesday trading, recovering some losses after a steep fall the previous day. The sell-off came amid concerns that a U.S. credit-card rate cap might hit profits.
The move is significant given Barclays’ large U.S. card operation. Matt Britzman, senior equity analyst at Hargreaves Lansdown, noted it ranks as the ninth largest in the market and brings in roughly 11% of the group’s profits.
Traders face a fundamental challenge: crucial details remain scarce. President Donald Trump announced a one-year 10% cap on credit-card interest rates beginning Jan. 20 but did not explain how companies would be forced to follow it.
Barclays shares slipped 2.4% to 4.73 pounds on Monday, lagging behind the wider London market.
Banks and card lenders took a hit on both sides of the Atlantic. In the U.S., JPMorgan Chase, Citigroup, Bank of America and Wells Fargo dropped as investors scrambled to price in a sudden squeeze on high-margin consumer lending.
UBS Global analysts were swift to doubt the feasibility of the proposal, saying “it would take an Act of Congress” to impose such caps due to the legal hurdles an executive order would confront. Reuters
Even the possibility of a cap is unsettling for the sector, given that credit cards rank as one of the costliest types of consumer debt. Reuters referenced Federal Reserve data indicating that average credit-card interest rates stood at 20.97% in November, so a 10% limit would represent a major shift in lenders’ financial landscape.
J.P. Morgan analyst Vivek Juneja flagged a risk that the cap might prompt banks to cut credit limits or shut accounts for borrowers with lower scores. This could nudge consumers toward pricier non-bank lending.
Barclays reported new buyback activity. In a recent filing, the bank revealed it repurchased 2,544,993 ordinary shares on Jan. 12, canceling them at a volume-weighted average price of 471.5139 pence each.
While the buyback might boost earnings per share down the line, it leaves the pressing issue untouched: how much political and regulatory risk is baked into U.S. consumer credit right now.
Traders are now focusing on any updates about the proposed cap before its planned Jan. 20 rollout. Attention will also turn to remarks from bank executives as the U.S. earnings season kicks off this week, beginning with JPMorgan’s report on Tuesday.
Related articles: LSE:BARC.L
