The Barclays (LSE: BARC) share price has had a rip-roaring 2024, hovering 79.3% to date. That is sensible information for Barclays buyers however a ache for me. When confronted with the selection final 12 months I purchased Lloyds Banking Group as a substitute.

My Lloyd shares are up a decent 15.33% in 2024. The trailing yield of 4.97% has lifted my complete return in the direction of 20%. That’s nothing to complain about however the whole lot in life is relative, and comparatively talking, Lloyds has been comparatively garbage in comparison with Barclays.

And I’m comparatively irritated about it. I’m hopeful too, as a result of I do know that investing is cyclical. It’s not unknown for winners and losers to alter locations.

Final 12 months noticed an in a single day change in investor attitudes to the massive FTSE 100 banks. It started on 19 February, when NatWest Group posted a stellar set of outcomes. Its £6.2bn pre-tax revenue was the most important because the monetary disaster, whereas it additionally introduced a £300m share buyback.

NatWest jumped on the day and stays this 12 months’s largest FTSE 100 winner of all of them, having rocketed 101%.

On 20 February Barclays really reported a drop in full-year 2023 earnings, from £7bn to £4.3bn. Buyers quickly acquired over their disappointment because the board pledged to lavish them with £10bn in dividends and share buybacks over the following three years.

Barclays additionally benefitted from excessive rates of interest, which widened its web curiosity margins  from 2.86% in 2022 to three.98%.

The sector-wide restoration unfold to Lloyds, and for some time my shares had been holding their very own. Then the motor finance mis-selling scandal erupted over the summer season. It turned out that Lloyds had outsized publicity by its Black Horse division, whereas Barclays didn’t.

RBC Capital Markets not too long ago estimated that Lloyds might take a £3.2bn hit. Barclays could also be on the hook for a modest £400m.

The share price ought to rally with luck

One other plus for Barclays is that it nonetheless has publicity to funding banking, a market Lloyds exited after the monetary disaster. Whereas it’s a dangerous sector it offers buyers the form of pleasure they received’t get from Lloyds.

Whereas Barclays competes with the likes of JPMorgan and Goldman Sachs, Lloyds has to console itself with the nuts and bolts of retail and small enterprise banking.

Barclays is more likely to get one other carry because the UK authorities plots to loosen the principles on banker bonuses. With Donald Trump heading again to the White Home, on line casino capitalism could also be on its manner again. Lloyds received’t be invited. Possibly that’s not a foul factor, given the mess it’s acquired itself into over boring outdated automobile loans.

Lloyds appears to be like higher worth at the moment with a decrease price-to-earnings ratio of seven.29, whereas Barclays appears to be like pricier than it did at 9.73 instances. It has a better trailing yield of 4.97%, whereas the Barclays yield has shrunk to 2.95%.

With luck, Lloyds will get a carry as soon as the motor finance scandal is cleared up. Within the spirit of optimism, I anticipate its shares to realize floor on Barclays subsequent 12 months. However within the longer run, I nonetheless suspect I’ll have backed the slower horse.