British banks will this month shrug off the impact of the sub-prime mortgage crisis to post record profits, it has been reported.
The UK’s largest investment banks’ total profit is set to hit £40.5 billion, the Daily Mail reports.
This is up from last year’s total of $39.5 billion during 2006, with HSBC expected to lead the way with a return of around $12 billion.
However, following years of successive of double-digit growth in recent years, investors are likely to be disappointed at this year’s profits with last year’s profits up 11 per cent from the previous year, which in turn saw profits up 17 per cent.
Jonathan Pierce, analyst at Credit Suisse, said that the impact of turmoil in the markets will hit the banks even more markedly this year
He predicted: "This year will be a different story and we will see bank earnings going backwards."
Barclays, Alliance and Leicester and Lloyds TSB will kick off the reporting season next week.
