Cashing in on an upturn; your money: : BANKS.

Byline: CLINTON MANNING

TWO of Britain's biggest banks signalled a return to the boom times yesterday.

A year after the banking system nearly collapsed, Barclays and HSBC reported bumper results.

Both avoided direct state aid but have still benefited from billions of pounds pumped into the financial system.

Underlying profits at Barclays more than doubled to pounds 4.4bn in the first nine months of the year.

Business in its investment banking arm jumped by a third, making hefty bonuses for star performers likely early next year. It contrasts with branches where profits "decreased significantly".

While bad debts jumped 65% to pounds 6.2bn, the rate slowed in the final quarter.

HSBC also revealed the threat from potentially dodgy debts was levelling off.

The banking heavyweight said its profits for 2009 would be much stronger than expected at the start of the year.

Earnings for the three months to September were "significantly ahead", with its investment arm enjoying a "record performance".

Boss Michael Geoghegan says the worst is over: "I believe the biggest jolt has passed."

The ba i l e d -out Royal Bank of Scotland reported third quarter losses of pounds 2.2bn last week.

CAPTION(S):

HSBC BOSS Geoghegan