THE UK's half-year bank reporting season kicks off this week with Barclays, Lloyds Banking Group and Royal Bank of Scotland due to issue results.
Other blue chips such as British Gas owner Centrica and ITV will also announce results but it is the banking sector that will dominate the corporate agenda.
The result of talks with the City regulator over plans to bolster its capital strength are expected to be announced alongside Barclays' interim results on Tuesday. The group sparked a spat with the Prudential Regulation Authority when boss Antony Jenkins suggested it may cut lending if it has to meet stringent new leverage demands.
The half-year results will also see Mr Jenkins update on the group's overhaul and outline progress on slashing costs. Citi predicts underlying profits of £2 billion in the second quarter, helping interim profits surge to £3.57bn, excluding restructuring costs, from £871 million a year earlier.
Lloyds claimed it had made substantial progress on its path to recovery, with a better-than-expected jump in profits over the first three months of the year. It is expected to report more progress when it publishes half-year results on Thursday. Analysts at Citi are expecting Lloyds to double interim underlying pre-tax profits to £2.2bn, while on a statutory basis it is also predicted to claw its way back out of the red, with profits of £3.3bn.
Speculation is mounting over the appointment of a successor to boss Stephen Hester ahead of half-year results from RBS on Friday.
Chairman Sir Philip Hampton gave a bullish outlook as the bank's first quarter figures showed RBS swinging out of the red with pre-tax profits of £826m.
Better retail revenues and lower loan losses at its troubled Ulster Bank arm are expected to drive further progress in the second quarter, with Citi experts pencilling in £917m in pre-tax profits for the three months to the end of June, against losses of £168m a year earlier.
However, they warn the investment banking business will see sliding revenues.
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