SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, each of
the registrants has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
BARCLAYS
PLC
(Registrant)
Date:
February 22, 2018
By: /s/
Garth Wright
----------------------
Garth
Wright
Assistant
Secretary
BARCLAYS
BANK PLC
(Registrant)
Date:
February 22, 2018
By: /s/
Garth Wright
----------------------
Garth
Wright
Assistant
Secretary
22
February 2018
Barclays PLC
Annual Report and Accounts 2017
UK Listing Authority submissions
In
compliance with Disclosure Guidance & Transparency Rule (DTR)
4.1, Barclays PLC announces that the following documents will today
be submitted to the National Storage Mechanism and will shortly be
available for inspection at:
www.Hemscott.com/nsm.do
●
Barclays PLC Annual Report 2017;
●
Barclays PLC Strategic Report 2017; and
●
Pillar 3 Report for 2017
These documents may also be accessed via Barclays PLC's website
at
home.barclays/investorrelations
The
Barclays PLC Strategic Report 2017 (or the full Annual Report 2017
for those shareholders who have requested it) will be posted to
shareholders on Thursday, 22 March 2018.
Additional information
The following information is extracted from the Barclays PLC Annual
Report 2017 (page references are to pages in the Annual Report) and
should be read in conjunction with Barclays PLC's Final Results
announcement issued on 22 February 2018. Both documents can
be found at
home.barclays/investorrelations
and
together constitute the material required by DTR 6.3.5 to be
communicated to the media in unedited full text through a
Regulatory Information Service. This material is not a
substitute for reading the Barclays PLC Annual Report 2017 in
full.
Risk Review
Material existing and emerging risks to the Group's future
performance
Material risks are those to which senior management pay particular
attention and which could cause the delivery of the Group's
strategy, results of operations, financial condition and/or
prospects to differ materially from current
expectations.
Emerging risks are those that have largely unknown components, the
impact of which could crystallise over a longer time horizon. These
could currently be considered immaterial but over time may
individually or cumulatively affect the Group's strategy and cause
the same outcomes as detailed above regarding material risks. In
addition, certain factors beyond the Group's control, including
escalation of terrorism or global conflicts, natural disasters and
similar calamities, although not detailed below, could have a
similar impact on the Group.
The risks described below are material risks that senior management
has identified with respect to the Group, which is defined as
Barclays PLC and its consolidated subsidiaries (including the
Barclays Bank PLC Group). In connection with the planned
implementation in the first half of 2018 of ring-fencing certain of
the Group's UK businesses, Barclays Bank PLC will transfer what are
materially the assets and business of the Barclays UK division to
another subsidiary of the Group, Barclays Bank UK PLC. Senior
management expects that upon this transfer, the material risks with
respect to the Barclays Bank PLC Group will be the same in all
material respects as those risks with respect to the Group. For
more information on certain risks senior management has identified
with respect to the Barclays Bank PLC Group, see v) Certain
potential consequences of ring-fencing to Barclays Bank
PLC.
Material existing and emerging risks potentially impacting more
than one Principal Risk
i)
Business conditions, general economy and geopolitical
issues
The Group offers a broad range of services, including to retail,
institutional and government customers, in a large number of
countries. The breadth of these operations means that deterioration
in the economic environment, or an increase in political
instability in countries where the Group is active, or in any
systemically important economy, could adversely affect the Group's
operating performance, financial condition and
prospects.
Although economic activity continued to strengthen globally in 2017
a change in global economic conditions and the reversal of the
improving trend may result in lower client activity of the Group
and/or an increase of the Group's default rates, delinquencies,
write-offs, and impairment charges, which in turn could adversely
affect the Group's performance and prospects.
In several countries, reversals of capital inflows, as well
as fiscal austerity, have already caused deterioration in political
stability. This could be exacerbated by a renewed rise in asset
price volatility or sustained pressure on government finances. In
addition, geopolitical tensions in some areas of the world, such as
the Korean Peninsula, the Middle East and Eastern Europe, are
already acute and at risk of further deterioration, thus
potentially increasing market uncertainties and adverse global
economic and market conditions.
In the US, there is uncertainty around the policy platform of the
administration which took office in 2017. There is the possibility
of significant changes in policy in sectors including trade,
healthcare and commodities which may have an impact on associated
Barclays portfolios. A significant proportion of the Group's
portfolio is located in the US, including a major credit card
portfolio and a range of corporate and investment banking
exposures. Stress in the US economy, weakening GDP, an unexpected
rise in unemployment and/or an increase in interest rates could
lead to increased levels of impairment.
Most major central banks have indicated that they expect prevailing
loose monetary policies to tighten. Should 'normalisation' paths
diverge substantially, flows of capital between countries could
alter significantly, placing segments with sizeable foreign
currency liabilities, in particular emerging markets, under
pressure. In addition, possible divergence of monetary policies
between major advanced economies risks triggering further financial
market volatility (see also ii) Interest rate rises adversely
impacting credit conditions, below).
In the UK, the vote in favour of leaving the EU (see iii) Process
of UK withdrawal from the European Union, below) has given rise to
political uncertainty with attendant consequences for investment
and market confidence. The initial impact was a depreciation of
Sterling resulting in higher costs for companies exposed to imports
and a more favourable environment for exporters. Rising domestic
costs resulting from higher import prices may impact household
incomes and the affordability of consumer loans and mortgages. In
turn this may affect businesses dependent on consumers for revenue.
There has also been a reduction in activity in both commercial and
residential real estate markets which has the potential to impact
value of real estate assets and adversely affect mortgage
assets.
Sentiment towards emerging markets as a whole continues to be
driven in large part by developments in China, where there is some
concern around the ability of authorities to manage growth while
transitioning from manufacturing towards services. Although the
Chinese government's efforts to stably increase the weight of
domestic demand have had some success, the pace of credit growth
remains a concern, given the high level of leverage and despite
regulatory action. A stronger than expected slowdown could result
if authorities fail to appropriately manage the end of the
investment and credit-led boom.
Deterioration in emerging markets could affect the Group if it
results in higher impairment charges for the Group via sovereign or
counterparty defaults.
More broadly, a deterioration of conditions in the key markets
where the Group operates could affect performance in a number of
ways including, for example: (i) deteriorating business, consumer
or investor confidence leading to reduced levels of client
activity, including demand for borrowing from creditworthy
customers, or indirectly, a material adverse impact on GDP growth
in significant markets and therefore on Group performance; (ii)
higher levels of default rates and impairment; (iii) mark to market
losses in trading portfolios resulting from changes in factors such
as credit ratings, share prices and solvency of counterparties (iv)
reduced ability to obtain capital from other financial institutions
for the Group operations; and (v) lower levels of fixed asset
investment and productivity growth overall.
ii)
Interest rate rises adversely impacting credit
conditions
To the extent that central banks increase interest rates
particularly in the Group's main markets, in the UK and the US,
there could be an impact on consumer debt affordability and
corporate profitability.
While interest rate rises could positively impact the Group's
profitability, as retail and corporate business income may increase
due to margin de-compression, future interest rate increases, if
larger or more frequent than expectations, could cause stress
in the loan portfolio and underwriting activity of the Group.
Higher credit losses driving an increased impairment allowance
would most notably impact retail unsecured portfolios and wholesale
non- investment grade lending.
Interest rates rising faster than expected could also have an
adverse impact on the value of high quality liquid assets which are
part of the Group Treasury function's investment activity that
could consequently create more volatility through the Group's
available for sale reserves than expected.
iii)
Process of UK withdrawal from the European Union
The uncertainty and increased market volatility following the UK's
decision to leave the EU in 2019 is likely to continue until the
exact nature of the future trading relationship with the EU becomes
clear. The potential risks associated with an exit from the EU
include:
■ Increased market risk with the impact on the
value of trading book positions, mainly in Barclays International,
expected to be driven predominantly by currency and interest rate
volatility.
■ Potential for credit spread widening for UK
institutions which could lead to reduced investor appetite for
Barclays' debt securities, which could negatively impact the cost
of and/or access to funding. Potential for continued market and
interest rate volatility could affect the interest rate risk
underlying, and potentially affect the value of the assets in the
banking book, as well as securities held by Barclays for liquidity
purposes.
■ Changes in the long-term outlook for UK interest
rates which may adversely affect IAS 19 pension liabilities and the
market value of equity investments funding those
liabilities.
■ Increased risk of a UK recession with lower growth,
higher unemployment and falling UK house prices. This would likely
negatively impact a number of Barclays' portfolios, particularly in
Barclays UK, notably: higher Loan to Value mortgages, UK unsecured
lending including credit cards and Commercial Real Estate
exposures.
■ Changes to current EU "Passporting" rights which will
likely require adjustments to the current model for the Group's
cross-border banking operation which could increase operational
complexity and/or costs.
■ The ability to attract, or prevent the
departure of, qualified and skilled employees may be impacted by
the UK's future approach to the EU freedom of movement and
immigration from the EU countries and this may impact Barclays'
access to the EU talent pool.
■ The legal framework within which Barclays operates
could change and become more uncertain as the UK takes steps to
replace or repeal certain laws currently in force, which are based
on EU legislation and regulation (including EU regulation of the
banking sector). Certainty of existing contracts, enforceability of
legal obligations and uncertainty around the outcome of disputes
may be affected until the impacts of the loss of the current
jurisdictional arrangements between UK and EU courts and the
universal enforceability of judgements across the EU (including the
status of existing EU case law) are fully known.
iv)
Regulatory change agenda and impact on business model
The Group remains subject to ongoing significant levels of
regulatory change and scrutiny in many of the countries in which it
operates (including, in particular, the UK and the US). As a
result, regulatory risk will remain a focus for senior management
and consume significant levels of business resources. Furthermore,
a more intensive regulatory approach and enhanced requirements
together with the uncertainty (particularly in light of the UK's
decision to withdraw from the EU) and potential lack of
international regulatory co-ordination as enhanced supervisory
standards are developed and implemented may adversely affect the
Group's business, capital and risk management strategies and/or may
result in the Group deciding to modify its legal entity structure,
capital and funding structures and business mix, or to exit certain
business activities altogether or not to expand in areas despite
otherwise attractive potential.
The most significant of the regulatory reforms affecting the Group
in 2018 is the creation of the ring-fenced Bank under the Bank's
structural reform programme (for more on Structural Reform, see
Supervision and Regulation on page 204).
The implementation of these changes involves a number of risks
which include:
■ The Group is restructuring its intra-group and
external capital, funding and liquidity arrangements to meet
regulatory requirements and support business needs. The changes
will impact the sources of funding available to the different
entities including their respective ability to access the capital
markets. These changes may affect funding costs.
■ The changes to the Group structure may negatively
impact the assessment made by credit rating agencies and creditors
over time.
The risk profile and key risk drivers of the ring-fenced bank and
the non ring-fenced bank will be specific to the activities and
risk profile of each entity. As a result, different
Group entities such as Barclays Bank PLC may also be assessed
differently in future which could result in differences in credit
ratings. Changes to the credit assessment at the Group or
individual entity level, including the potential for ratings
downgrades and ratings differences across entities, could impact
access and cost of certain sources of funding.
■ Implementation of ring-fencing introduces a
number of execution risks. Technology change could result in
outages or operational errors. Legal challenge to the ring-fence
transfer scheme may delay the transfer of assets and liabilities to
the ring-fenced bank. Delayed delivery could increase reputational
risk or result in regulatory non-compliance.
■ There is a risk that Barclays does not meet
regulatory requirements across the new structure. Failure to meet
these requirements may have an adverse impact on the Group's
profitability, operating flexibility, flexibility of deployment of
capital and funding, return on equity, ability to pay dividends,
credit ratings, and/or financial condition.
In addition to Structural Reform there are several other
significant pieces of legislation/ areas of focus which will
require significant management attention, cost and
resource:
■ Changes in prudential requirements, including the
proposals for amendment of the CRD IV and the BRRD (as part of the
EU's risk reduction measures package) may impact minimum
requirements for own funds and eligible liabilities (MREL)
(including requirements for internal MREL), leverage, liquidity or
funding requirements, applicable buffers and/or add-ons to such
minimum requirements and risk weighted assets calculation
methodologies all as may be set by international, EU or
national authorities from time to time. Such or similar changes to
prudential requirements or additional supervisory and prudential
expectations, either individually or in aggregate, may result in,
among other things, a need for further management actions to meet
the changed requirements, such as: increasing capital, MREL or
liquidity resources, reducing leverage and risk weighted assets;
restricting distributions on capital instruments; modifying the
terms of outstanding capital instruments; modifying legal entity
structure (including with regard to issuance and deployment
of capital, MREL and funding for the Group); changing the Group's
business mix or exiting other businesses; and/or undertaking other
actions to strengthen the Group's position. (See Treasury and
capital risk on pages 164 to 190 and Supervision and Regulation on
pages 197 to 204 for more information).
■ The derivatives market has been the subject of
particular focus for regulators in recent years across the G20
countries and beyond, with regulations introduced which require the
reporting and clearing of standardised over the counter (OTC)
derivatives and the mandatory margining of non-cleared OTC
derivatives. Reforms in this area are ongoing with further
requirements expected to be implemented in the course of 2018. More
broadly, the recast Markets in Financial Instruments Directive in
Europe (MiFID II), which came into force in January 2018, has
fundamentally changed the European regulatory framework, and
entails significant operational changes for market
participants in a wide range of financial instruments as well
as changes in market structures and practices. In addition, the EU
Benchmarks Regulation which also came into force in January 2018
regulates the administration and use of benchmarks in the
EU. Compliance with this evolving regulatory framework
entails significant costs for market participants and is having a
significant impact on certain markets in which the Group, notably
Barclays International, operates.
Other regulations applicable to swap dealers, including those
promulgated by the US Commodity Futures Trading Commission, have
imposed significant costs on the Group's derivatives business.
These and any future requirements, including the US SEC's
regulations relating to security-based swaps and the possibility of
overlapping and/or contradictory requirements imposed on derivative
transactions by regulators in different jurisdictions, are expected
to continue to impact such business.
■ The Group and certain of its members are subject to
supervisory stress testing exercises in a number of jurisdictions.
These exercises currently include the programmes of the BoE, the
EBA, the FDIC and the FRB. These exercises are designed to assess
the resilience of banks to adverse economic or financial
developments and enforce robust, forward- looking capital and
liquidity management processes that account for the risks
associated with their business profile. Assessment by regulators is
on both a quantitative and qualitative basis, the latter focusing
on the Group's or certain of its members' business model, data
provision, stress testing capability and internal management
processes and controls. The stress testing requirements to which
the Group and its members are subject are becoming increasingly
stringent. Failure to meet requirements of regulatory stress tests,
or the failure by regulators to approve the stress test results and
capital plans of the Group, could result in the Group being
required to enhance its capital position, limit capital
distributions or position additional capital in specific
subsidiaries. For more information on stress testing, please see
Supervision and Regulation on page 200.
■ The introduction and implementation of both
PSD2 and the Open API standards and data sharing remedy imposed by
the UK Competition and Markets Authority following its Retail
Banking Market Investigation Order (together "Open Banking") from
January 2018 is anticipated to transform the traditional UK banking
model and conventional relationship between a customer and their
bank. It will do this by providing customers with the ability to
share their transactional data with authorised third party service
providers either for aggregation or payment services. It is
anticipated that these aggregation or payment services will be
offered by third parties to Barclays customers.
Members of the Barclays Group will be able to offer these same
services to customers of other banks. A failure to comply with Open
Banking requirements could expose Barclays to regulatory sanction,
potential financial loss and reputational detriment. While Open
Banking will affect the Group as a whole, the impact is likely to
be particularly relevant for Barclays UK.
v)
Certain potential consequences of ring-fencing to Barclays Bank
PLC
In connection with the planned implementation in the first half of
2018 of ring-fencing certain of the Group's UK businesses, Barclays
Bank PLC will transfer what are materially the assets and business
of the Barclays UK division to another subsidiary of the Group,
Barclays Bank UK PLC. Senior management expects that upon this
transfer, the material risks with respect to the Barclays Bank PLC
Group will be the same in all material respects as those risks with
respect to the Group. However, senior management has identified
certain potential differences in risks with respect to the Barclays
Bank PLC Group as compared to risks to the Group.
The transfer of the assets and liabilities of the Barclays UK
division from Barclays Bank PLC will mean that the Barclays Bank
PLC Group will be less diversified than the Group as a whole.
Barclays Bank PLC will not be the parent of Barclays Bank UK PLC
and thus will not have recourse to the assets of Barclays Bank UK
PLC. Relative to the Group, the Barclays Bank PLC Group will be,
among other things:
■ more focused on businesses outside the UK,
particularly in the US, and thus more exposed to the US economy and
more affected by movements in the US dollar (and other non-sterling
currencies) relative to sterling, with a relatively larger portion
of its business exposed to US regulation;
■ more focused on wholesale businesses, such as
corporate and investment banking and capital markets, which expose
Barclays Bank PLC Group to a broader range of market conditions and
to counterparty and operational risks and thus the financial
performance of Barclays Bank PLC may be subject to greater
fluctuations relative to that of the Group as a whole or that of
the ring-fenced bank;
■ more dependent on wholesale funding sources, as the
UK retail deposit base will be transferred to the ring-fenced bank.
The UK retail mortgage assets will also be transferred to the
ring-fenced bank, which reduces Barclays Bank PLC's access to
funding sources reliant on residential mortgage collateral. The
Barclays Bank PLC Group may therefore experience more difficult
financing conditions and/or higher costs of funding including in
situations of stress. As a result of the implementation of
ring-fencing, different Group entities, such as Barclays Bank PLC,
may be assessed differently by credit rating agencies, which may
result in different, and possibly more negative, assessments of
Barclays Bank PLC's credit and thus in lower credit ratings than
the credit ratings of the Group, which in turn could adversely
affect the sources and costs of funding for Barclays Bank PLC;
and
■ potentially subject to different regulatory
obligations, including different liquidity requirements and capital
buffers.
As a result of any or all of the foregoing, implementation of
ring-fencing may adversely affect the market value and/or liquidity
of securities issued by Barclays Bank PLC.
Material existing and emerging risks impacting individual Principal
Risks
i)
Credit risk
a)
Impairment
The introduction of the impairment requirements of IFRS 9 Financial
Instruments, implemented on 1 January 2018, results in higher
impairment loss allowances that are recognised earlier, on a more
forward looking basis and on a broader scope of financial
instruments than is the case under IAS 39 and, as a result, will
have a material impact on the Group's financial condition.
Measurement involves increased complex judgement and impairment
charges will tend to be more volatile. Unsecured products with
longer expected lives, such as revolving credit cards, are the most
impacted. The capital treatment on the increased reserves has the
potential to adversely impact regulatory capital ratios. In
addition, the move from incurred to expected credit losses has the
potential to impact the Group's performance under stressed economic
conditions or regulatory stress tests. For more information please
refer to Note 1 on pages 241 to 246.
b)
Specific sectors
The Group is subject to risks arising from changes in credit
quality and recovery rate of loans and advances due from borrowers
and counterparties in a specific portfolio. Any deterioration in
credit quality could lead to lower recoverability and higher
impairment in a specific sector. The following are areas of
uncertainties to the Group's portfolio which could have a material
impact on performance.
■ UK real estate market. With UK property
representing a significant portion of the overall UK Corporate and
Retail credit exposure, the Group is at risk from a fall in
property prices in both the residential and commercial sectors in
the UK.
Strong house price growth in London and the South East of the UK,
fuelled by foreign investment, strong buy-to-let (BTL) demand and
subdued housing supply, has resulted in affordability metrics
becoming stretched. Average house prices as at the end of 2017 were
more than 5.6 times average earnings.
■ Large single name losses. The Group has large
individual exposures to single name counterparties both in its
lending activities and in its financial services and trading
activities, including transactions in derivatives and transactions
with brokers, central clearing houses, dealers, other banks, mutual
and hedge funds and other institutional clients. The default of
such counterparties could have a significant impact on the carrying
value of these assets. In addition, where such counterparty risk
has been mitigated by taking collateral, credit risk may remain
high if the collateral held cannot be realised, or has to be
liquidated at prices which are insufficient to recover the full
amount of the loan or derivative exposure. Any such defaults could
have a material adverse effect on the Group's results due to, for
example, increased credit losses and higher impairment
charges.
■ Leverage finance underwriting. The Group takes
on sub-investment grade underwriting exposure, including single
name risk, particularly in the US and Europe. The Group is exposed
to credit events and market volatility during the underwriting
period. Any adverse events during this period may potentially
result in loss for the Group, mainly through Barclays
International, or an increased capital requirement should there be
a need to hold the exposure for an extended period.
ii)
Market risk
Market volatility
Elevated market volatility, which can be triggered and/or
aggravated by disappointment in economic data, divergent monetary
policies, political uncertainty or conflicts, would likely entail a
significant deflation of assets which in turn may put under strain
counterparties and have knock-on effects on the bank.
In addition, the Group's trading business is generally exposed to a
prolonged period of elevated asset price volatility, particularly
if it negatively affects the depth of marketplace liquidity. Such a
scenario could impact the Group's ability to execute client trades
and may also result in lower client flow-driven income and/or
market-based losses on its existing portfolio of market risks.
These can include having to absorb higher hedging costs from
rebalancing risks that need to be managed dynamically as market
levels and their associated volatilities change.
iii)
Treasury and capital risk
The Group may not be able to achieve its business plans due to,
among other things: a) being unable to maintain appropriate capital
ratios; b) being unable to meet its obligations as they fall due;
c) rating agency downgrades; d) adverse changes in foreign exchange
rates on capital ratios; e) adverse movements in the pension fund;
f ) non-traded market risk/ interest rate risk in the banking
book.
a)
Inability to maintain prudential ratios and other regulatory
requirements
Inability to maintain appropriate prudential ratios could lead to:
an inability to support business activity; a failure to meet
regulatory capital requirements including any additional capital
add-ons or the requirements set for regulatory stress tests;
increased cost of funding due to deterioration in investor
appetite or credit ratings; restrictions on distributions including
the ability to meet dividend targets; and/or the need to take
additional measures to strengthen the Group's capital or leverage
position.
b)
Inability to manage liquidity and funding risk
effectively
Inability to manage liquidity and funding risk effectively may
result in the Group either not having sufficient financial
resources to meet its payment obligations as they fall due or,
although solvent, only being able to meet these obligations at
excessive cost. This could cause the Group to fail to meet
regulatory liquidity standards, be unable to support day-to-day
banking activities (including meeting deposit withdrawals or
funding new loans) or no longer be a going concern.
The stability of the Group's current funding profile, in particular
that part which is based on accounts and savings deposits payable
on demand or at short notice, could be affected by the Group
failing to preserve the current level of customer and investor
confidence. The Group also regularly accesses the capital markets
to provide long-term funding to support its operations. Several
factors, including adverse macroeconomic conditions, adverse
outcomes in legal, regulatory or conduct matters and loss of
confidence by investors, counterparties and/ or customers in the
Group, can affect the ability of the Group to access the capital
markets and/ or the cost and other terms upon which the Group is
able to obtain market funding.
c)
Credit rating changes and the impact on funding costs
Any potential or actual credit rating agency downgrades could
significantly increase the Group's borrowing costs, credit spreads
and materially adversely affect the Group's interest margins and
liquidity position which may, as a result, significantly diverge
from current expectations. Such adverse changes would also have a
negative impact on the Group's overall performance.
d)
Adverse changes in FX rates impacting capital ratios
The Group has capital resources, risk weighted assets and leverage
exposures denominated in foreign currencies. Changes in foreign
currency exchange rates may adversely impact the Sterling
equivalent value of these items. As a result, the Group's
regulatory capital ratios are sensitive to foreign currency
movements, and any failure to appropriately manage the Group's
balance sheet to take account of foreign currency movements could
result in an adverse impact on regulatory capital and leverage
ratios.
e)
Adverse movements in the pension fund
Adverse movements in pension assets and liabilities for defined
benefit pension schemes could result in a pension deficit which,
depending on the specific circumstance, may require the Group to
make substantial additional contributions to its pension
plans. The liabilities discount rate is a key driver and, in
accordance with International Financial Reporting Standards (IAS
19), is derived from the yields of high quality corporate bonds
(deemed to be those with AA ratings) and consequently includes
exposure to both UK sovereign gilt yields and corporate credit
spreads.
Therefore, the valuation of the Group's defined benefits schemes
would be adversely affected by a prolonged fall in the discount
rate due to a persistent low rate and/or credit spread environment.
Inflation is another significant risk driver to the pension fund,
as the liabilities are adversely impacted by an increase in
long-term inflation expectations.
f)
Non-traded market risk/interest rate risk in the banking
book
A liquidity buffer investment return shortfall could increase the
Bank's cost of funds and impact the capital ratios. The Bank's
structural hedge programmes for interest rate risk in the banking
book rely heavily on behavioural assumptions, as a result, the
success of the hedging strategy is not guaranteed. A potential
mismatch in the balance or duration of the hedge assumptions could
lead to earnings deterioration.
iv)
Operational risk
a)
Cyber threat
The frequency of cyber attacks continues to grow on an annual basis
and is a global threat which is inherent across all industries,
including the financial sector. As the financial sector remains a
primary target for cyber criminals, 2017 saw a number of highly
publicised attacks involving ransomware, theft of intellectual
property, customer data and service unavailability across a wide
range of organisations.
The cyber threat increases the inherent risk to the availability of
the Group's services and to the Group's data (whether it is held by
the Group or in its supply chain), to the integrity of financial
transactions of the Group, its clients, counterparties and
customers. Failure to adequately manage this threat and to
continually evolve enterprise security and provide an active cyber
security response capability could result in increased fraud
losses, inability to perform critical economic functions, customer
detriment, potential regulatory censure and penalty, legal
liability, reduction in shareholder value and reputational
damage.
b)
Service resilience
Loss of or disruption to the Group's business processing, whether
arising through impacts on technology systems, real estate
services, personnel availability or the support of major suppliers,
represents a material inherent risk theme for the
Group.
Building resilience into business processes and into the services
of technology, real estate and suppliers on which those processes
depend can reduce disruption to the Group's business activities or
avoid it altogether. Failure to do so may result in significant
customer detriment, cost to reimburse losses incurred by our
customers, potential regulatory censure or penalty, and
reputational damage.
c)
Outsourcing
The Group depends on suppliers for the provision of many of its
services and the development of future technology driven product
propositions, though the Group continues to be accountable for risk
arising from the actions of such suppliers. Failure to
monitor and control the Group's suppliers could potentially lead to
client information, or critical infrastructures and services, not
being adequately protected or available when required.
The dependency on suppliers and sub- contracting of outsourced
services introduces concentration risk where the failure of
specific suppliers could have an impact on our ability to continue
to provide services that are material to the Group, especially for
those individual businesses within the Group to which many services
are provided centrally by the newly established Group Service
Company.
Failure to adequately manage outsourcing risk through control
environments which remain robust to ever changing threats and
challenges could result in increased losses, inability to perform
critical economic functions, customer detriment, potential
regulatory censure and penalty, legal liability and reputational
damage.
d)
Operational precision and payments
The risk of material errors in operational processes, including
payments, are exacerbated during the present period of significant
levels of structural and regulatory change, the evolving technology
landscape, and a transition to digital channel
capabilities.
Material operational or payment errors could disadvantage the
Group's customers, clients or counterparties and could result in
regulatory censure and penalties, legal liability, reputational
damage and financial loss by the bank.
e)
New and emergent technology
Technological advancements present opportunities to develop new and
innovative ways of doing business across the Group, with new
solutions being developed both in-house and in association with
third party companies. Introducing new forms of technology has the
potential to increase inherent risk.
Failure to closely monitor risk exposure could lead to customer
detriment, loss of business, regulatory censure, missed business
opportunity and reputational damage.
f)
Fraud
Fraud is a constantly evolving risk to the Group. This is
exacerbated during periods of significant change, including the
digitisation of products, which carry higher levels of inherent
risk. As the Group continues to invest in new and upgraded fraud
systems, criminals continually adapt and become ever more
sophisticated in their approach. Risks from social engineering and
attempts to trick customers into authorising payments also continue
to grow and increasing regulatory focus is placing more
responsibility on the industry to protect consumers.
In addition, internal fraud arising from areas such as failure of
the Group's trading controls could result in high profile material
losses together with regulatory censure / penalties and significant
reputational damage.
g)
Ability to hire and retain appropriately qualified
employees
The Group has resource requirements to support existing revenue
streams, moves into new business models and to deliver complex
multi-year regulatory commitments and mandatory change. These
commitments require diversified and specialist skilled colleagues
and Barclays' ability to attract, develop and retain such a diverse
mix of talent is key to the delivery of its core business
activity and strategy. This is impacted by a range of external and
internal factors. External regulation such as the introduction of
the Individual Accountability Regime and the required deferral and
clawback provisions of our compensation arrangements may make
Barclays a less attractive proposition relative to both our
international competitors and other industries. Similarly, the
impact of exit of the UK from the EU, in March 2019 (see Process of
UK withdrawal from the European Union on pages 121 and 122), could
potentially have a more immediate impact on our ability to hire and
retain key employees.
Failure to attract or prevent the departure of appropriately
qualified and skilled employees who are dedicated to overseeing and
managing current and future regulatory standards and expectations,
or who have the necessary diversified skills required to deliver
the Group strategy, could negatively impact our financial
performance, control environment and level of employee engagement.
Additionally, this may result in disruption to service which could
in turn lead to disenfranchising certain customer groups, customer
detriment and reputational damage.
h)
Tax risk
The Group is required to comply with the domestic and international
tax laws and practice of all countries in which it has
business operations. There is a risk that the Group could suffer
losses due to additional tax charges, other financial costs
or reputational damage as a result of failing to comply with such
laws and practice, or by failing to manage its tax affairs in an
appropriate manner, with much of this risk attributable to the
international structure of the Group. The Tax Cuts and Jobs Act has
introduced substantial changes to the US tax system, including the
introduction of a new tax, the Base Erosion Anti-Abuse Tax. These
changes have increased the Group's tax compliance obligations and
require a number of system and process changes which introduce
additional operational risk. In addition, increasing customer tax
reporting requirements around the world and the digitisation of the
administration of tax has potential to increase the Group's tax
compliance burden further.
i)
Critical accounting estimates and judgements
The preparation of financial statements in accordance with IFRS
requires the use of estimates. It also requires management to
exercise judgement in applying relevant accounting policies. The
key areas involving a higher degree of judgement or complexity, or
areas where assumptions are significant to the consolidated and
individual financial statements include credit impairment charges
for amortised cost assets, taxes, fair value of financial
instruments, pensions and post-retirement benefits, and provisions
including conduct and legal, competition and regulatory
matters. There is a risk that if the judgement exercised, or
the estimates or assumptions used, subsequently turn out to be
incorrect, this could result in significant loss to the Group,
beyond what was anticipated or provided for.
The further development of standards and interpretations under IFRS
could also significantly impact the financial results, condition
and prospects of the Group.
j)
Data management & information protection
The Group holds and processes large volumes of data, including
personally identifiable information, intellectual property, and
financial data. Failure to accurately collect and maintain this
data, protect it from breaches of confidentiality and interference
with its availability exposes the Bank to the risk of loss or
unavailability of data (including customer data covered under vi),
c) Data protection and privacy below), data integrity issues and
could result in regulatory censure, legal liability and
reputational damage.
v)
Model risk
Enhanced model risk management requirements
Barclays relies on models to support a broad range of business and
risk management activities, including informing business
decisions and strategies, measuring and limiting risk, valuing
exposures (including the calculation of impairment),
conducting stress testing, assessing capital adequacy, supporting
new business acceptance and risk/reward evaluation, managing client
assets, and meeting reporting requirements.
Models are, by their nature, imperfect and incomplete
representations of reality because they rely on assumptions and
inputs, and so they may be subject to errors affecting the accuracy
of their outputs. For instance, the quality of the data used in
models across Barclays has a material impact on the accuracy and
completeness of our risk and financial metrics.
Models may also be misused. Model errors or misuse may result in
the Group making inappropriate business decisions and being subject
to financial loss, regulatory risk, reputational risk and/or
inadequate capital reporting.
vi)
Conduct risk
There is the risk of detriment to customers, clients, market
integrity, competition or Barclays from the inappropriate supply of
financial services, including instances of wilful or negligent
misconduct. This risk could manifest itself in a variety of
ways:
a)
Product governance and life cycle
Ineffective product governance, including design, approval and
review of products, inappropriate controls over internal and third
party sales channels and post sales services could lead to poor
customer outcomes, as well as regulatory sanctions, financial loss
and reputational damage.
b)
Financial crime
The Group may be adversely affected if it fails to effectively
mitigate the risk that its employees or third parties facilitate,
or that its products and services are used to facilitate financial
crime (money laundering, terrorist financing, bribery and
corruption and sanctions evasion). A major focus of US and UK
government policy relating to financial institutions continues to
be combating money laundering and enforcing compliance with US and
EU economic sanctions. The failure to comply with such regulations
may result in enforcement actions by the regulators and in the
imposition of severe penalties, with a consequential impact on the
Group's reputation and financial results.
c)
Data protection and privacy
Proper handling of personal data is critical to sustaining
long-term relationships with our customers and clients and to
meeting privacy laws and obligations. Failure to protect personal
data can lead to potential detriment to our customers and clients,
reputational damage, regulatory sanctions and financial loss, which
under the new EU Data Protection Regulation may be
substantial.
d)
Regulatory focus on culture and accountability
Regulators around the world continue to emphasise the importance of
culture and personal accountability and the adoption and
enforcement of adequate internal reporting and whistleblowing
procedures in helping to promote appropriate conduct and drive
positive outcomes for customers, clients and markets. Failure to
meet the requirements and expectations of the UK Senior Managers
Regime, Certification Regime and Conduct Rules may lead to
regulatory sanctions, both for the individuals and the
firm.
vii)
Reputation risk
Barclays' association with sensitive sectors and its impact on
reputation
A risk arising in one business area can have an adverse effect upon
Barclays' overall reputation; any one transaction, investment or
event that, in the perception of key stakeholders reduces their
trust in the Group's integrity and competence, has the potential to
give rise to reputation risk for Barclays and may result in loss of
business, regulatory censure and missed business
opportunity.
Barclays' association with sensitive sectors is an area of concern
for stakeholders and the following topics are of regular
interest:
■ Disclosure of climate risks and opportunities,
including the activities of certain sections of the client base.
This is becoming the subject of increased scrutiny from regulators,
NGOs and other stakeholders.
■ The risks of association with human rights
violations through the perceived indirect involvement in human
rights abuses committed by clients and customers.
■ The manufacture and export of military and riot
control goods and services by clients and customers.
viii) Legal
risk and legal, competition and regulatory matters
Legal disputes, regulatory investigations, fines and other
sanctions relating to conduct of business and breaches of
legislation and/or regulations may negatively affect the Group's
results, reputation and ability to conduct its business. Legal
outcomes can arise as a consequence of legal risk or because of
past and future actions, behaviours and business decisions as a
result of other Principal Risks.
The Group conducts diverse activities in a highly regulated global
market and therefore is exposed to the risk of fines and other
sanctions relating to the conduct of its business. In recent years,
authorities have increasingly investigated past practices, pursued
alleged breaches and imposed heavy penalties on financial services
firms. This trend is expected to continue. A breach of applicable
legislation and/or regulations could result in the Group or its
staff being subject to criminal prosecution, regulatory censure,
fines and other sanctions in the jurisdictions in which it
operates, particularly in the UK and the US. Where clients,
customers or other third parties are harmed by the Group's conduct,
this may also give rise to legal proceedings, including class
actions. Other legal disputes may also arise between the
Group and third parties relating to matters such as breaches,
enforcement of legal rights or obligations arising under contracts,
statutes or common law. Adverse findings in any such matters may
result in the Group being liable to third parties seeking damages,
or may result in the Group's rights not being enforced as
intended.
Details of legal, competition and regulatory matters to which the
Group is currently exposed are set out in Note 29. In addition to
matters specifically described in Note 29, the Group is engaged in
various other legal proceedings in the UK and US and a number of
other overseas jurisdictions which arise in the ordinary course of
business. The Group is also subject to requests for information,
investigations and other reviews by regulators, governmental and
other public bodies in connection with business activities in which
the Group is or has been engaged. The Group is cooperating with the
relevant authorities and keeping all relevant agencies briefed as
appropriate in relation to these matters and others described in
Note 29 on an ongoing basis.
The outcome of legal, competition and regulatory matters, both
those to which the Group is currently exposed and any others which
may arise in the future, is difficult to predict. However, in
connection with such matters the Group may incur significant
expense, regardless of the ultimate outcome, and any such matters
could expose the Group to any of the following outcomes:
substantial monetary damages, settlements and/or fines; remediation
of affected customers and clients; other penalties and injunctive
relief; additional litigation; criminal prosecution in certain
circumstances; the loss of any existing agreed protection from
prosecution; regulatory restrictions on the Group's business
operations including the withdrawal of authorisations; increased
regulatory compliance requirements; suspension of operations;
public reprimands; loss of significant assets or business; a
negative effect on the Group's reputation; loss of confidence by
investors, counterparties, clients and or customers; risk of credit
rating agency downgrades; potential negative impact on the
availability and/or cost of funding and liquidity; and/or dismissal
or resignation of key individuals. In light of the uncertainties
involved in legal, competition and regulatory matters, there can be
no assurance that the outcome of a particular matter or matters
will not be material to the Group's results of operations or cash
flow for a particular period, depending on, among other things, the
amount of the loss resulting from the matter(s) and the amount of
income otherwise reported for the period.
In January 2017, Barclays PLC was sentenced to serve three years of
probation from the date of the sentencing order in accordance with
the terms of its May 2015 plea agreement with the DOJ. During the
term of probation Barclays PLC must, among other things, (i) commit
no crime whatsoever in violation of the federal laws of the US,
(ii) implement and continue to implement a compliance program
designed to prevent and detect the conduct that gave rise to the
plea agreement and (iii) strengthen its compliance and internal
controls as required by relevant regulatory or enforcement
agencies. Potential consequences of breaching the plea agreement
include the imposition of additional terms and conditions on the
Group, an extension of the agreement, or the criminal prosecution
of Group entities, which could, in turn, entail further financial
penalties and collateral consequences and have a material adverse
effect on the Group's business, operating results or financial
position.
There is also a risk that the outcome of any legal, competition or
regulatory matters in which the Group is involved may give rise to
changes in law or regulation as part of a wider response by
relevant law makers and regulators. A decision in any matter,
either against the Group or another financial institution facing
similar claims, could lead to further claims against the
Group.
Related party transactions and Directors' remuneration (Note
41)
Related party transactions
Parties
are considered to be related if one party has the ability to
control the other party or exercise significant influence over the
other party in making financial or operational decisions, or one
other party controls both. The definition includes subsidiaries,
associates, joint ventures and the Group's pension
schemes.
Subsidiaries
Transactions
between Barclays PLC and its subsidiaries also meet the definition
of related party transactions. Where these are eliminated on
consolidation, they are not disclosed in the Group Financial
Statements. Transactions between Barclays PLC and its subsidiary,
Barclays Bank PLC, are fully disclosed in Barclays PLC's balance
sheet and income statement. A list of the Group's principal
subsidiaries is shown in Note 36.
Associates, joint ventures and other entities
The
Group provides banking services to its associates, joint ventures,
the Group pension funds (principally the UK Retirement Fund) and to
entities under common directorships, providing loans, overdrafts,
interest and non-interest bearing deposits and current accounts to
these entities as well as other services. Group companies also
provide investment management and custodian services to the Group
pension schemes. The Group also provides banking services for unit
trusts and investment funds managed by Group companies, which are
not individually material. All of these transactions are conducted
on the same terms as third party transactions. Summarised financial
information for the Group's investments in associates and joint
ventures is set out in Note 38.
Amounts
included in the Group's financial statements, in aggregate, by
category of related party entity are as follows
|
|
Associates
£m
|
Joint
Ventures
£m
|
Pension
funds, unit trusts and investment funds
£m
|
|
For the year ended and as at 31 December 2017
|
|
|
|
|
Income / (expense)
|
(20)
|
38
|
4
|
|
Impairment releases
|
2
|
-
|
-
|
|
Total assets
|
2
|
1,048
|
2
|
|
Total liabilities
|
75
|
2
|
162
|
|
For the year ended and as at 31 December 2016
|
|
|
|
|
Income / (expense)
|
(20)
|
7
|
4
|
|
Impairment charges
|
(13)
|
-
|
-
|
|
Total assets
|
72
|
2,244
|
-
|
|
Total liabilities
|
94
|
95
|
260
|
|
For the year ended and as at 31 December 2015
|
|
|
|
|
Income / (expense)
|
(19)
|
40
|
4
|
|
Impairment charges
|
(4)
|
(2)
|
-
|
|
Total assets
|
36
|
1,578
|
-
|
|
Total liabilities
|
158
|
133
|
184
|
Guarantees,
pledges or commitments given in respect of these transactions in
the year were £27m (2016: £940m) predominantly relating
to joint ventures. No guarantees, pledges or commitments were
received in the year. Derivatives transacted on behalf of the
pensions funds, unit trusts and investment funds were £3m
(2016: £3m).
Key Management Personnel
The
Group's Key Management Personnel, and persons connected with them,
are also considered to be related parties for disclosure purposes.
Key Management Personnel are defined as those persons having
authority and responsibility for planning, directing and
controlling the activities of Barclays PLC (directly or indirectly)
and comprise the Directors of Barclays PLC and the Officers of the
Group, certain direct reports of the Group Chief Executive and the
heads of major business units and functions.
There
were no material related party transactions with entities under
common directorship where a Director or other member of Key
Management Personnel (or any connected person) is also a Director
or other member of Key Management Personnel (or any connected
person) of Barclays.
The
Group provides banking services to Directors and other Key
Management Personnel and persons connected to them. Transactions
during the year and the balances outstanding were as
follows:
Loans outstanding
|
|
2017
£m
|
2016
£m
|
|
As at 1 January
|
9.2
|
9.8
|
|
Loans issued during the year
|
0.5
|
0.6
|
|
Loan repayments during the year/change of key management
personnel
|
(4.9)
|
(1.2)
|
|
As at 31 December
|
4.8
|
9.2
|
No
allowances for impairment were recognised in respect of loans to
Directors or other members of Key Management Personnel (or any
connected person).
Deposits outstanding
|
|
2017
£m
|
2016
£m
|
|
As at 1 January
|
7.3
|
116.5
|
|
Deposits received during the year
|
25.7
|
18.9
|
|
Deposits repaid during the year/change of key management
personnel
|
(26.1)
|
(128.1)
|
|
As at 31 December
|
6.9
|
7.3
|
Total commitments outstanding
Total
commitments outstanding refers to the total of any undrawn amounts
on credit cards and/or overdraft facilities provided to Key
Management Personnel. Total commitments outstanding as at 31
December 2017 were £0.3m (2016: £0.2m).
All
loans to Directors and other Key Management Personnel (and persons
connected to them), (a) were made in the ordinary course of
business, (b) were made on substantially the same terms, including
interest rates and collateral, as those prevailing at the same time
for comparable transactions with other persons and (c) did not
involve more than a normal risk of collectability or present other
unfavourable features.
Remuneration of Directors and other Key Management
Personnel
Total
remuneration awarded to Directors and other Key Management
Personnel below represents the awards made to individuals that have
been approved by the Board Remuneration Committee as part of the
latest remuneration decisions, and is consistent with the approach
adopted for disclosures set out on pages 93 to 116. Costs
recognised in the income statement reflect the accounting charge
for the year included within operating expenses. The difference
between the values awarded and the recognised income statement
charge principally relates to the recognition of deferred costs for
prior year awards. Figures are provided for the period that
individuals met the definition of Directors and other Key
Management Personnel.
|
|
2017
£m
|
2016
£m
|
|
Salaries and other short-term benefits
|
33.9
|
31.9
|
|
Pension costs
|
0.1
|
0.2
|
|
Other long-term benefits
|
18.4
|
11.0
|
|
Share-based payments
|
26.8
|
21.9
|
|
Employer social security charges on emoluments
|
9.6
|
6.2
|
|
Costs recognised for accounting purposes
|
88.8
|
71.2
|
|
Employer social security charges on emoluments
|
(9.6)
|
(6.2)
|
|
Other long-term benefits - difference between awards granted and
costs recognised
|
(9.8)
|
(2.5)
|
|
Share-based payments - difference between awards granted and costs
recognised
|
(11.7)
|
(8.9)
|
|
Total remuneration awarded
|
57.7
|
53.6
|
Disclosure required by the Companies Act 2006
The
following information regarding Directors is presented in
accordance with the Companies Act 2006:
|
|
2017
£m
|
2016
£m
|
|
Aggregate emoluments
(a)
Amounts paid under LTIPs
(b)
|
8.5
1.1
|
8.1
-
|
|
|
9.6
|
8.1
|
Notes
(a) The
aggregate emoluments include amounts paid for the 2017 year. In
addition, deferred share awards for 2017 will be made to James E
Staley and Tushar Morzaria which will only vest subject to meeting
certain conditions. The total of the deferred share awards is
£1m (2016: £1.4m).
(b)
The figure above for "Amounts paid under LTIPs" relates to an LTIP
award that was released to Tushar Morzaria in 2017. Dividend shares
released on the award are excluded. The LTIP figure in the single
total figure table for executive Directors' 2017 remuneration in
the Directors' Remuneration report relates to the award that is
scheduled to be released in 2018 in respect of the 2015-2017 LTIP
cycle.
There
were no pension contributions paid to defined contribution schemes
on behalf of Directors (2016: £nil). There were no notional
pension contributions to defined contribution schemes.
As at
31 December 2017, there were no Directors accruing benefits under a
defined benefit scheme (2016: nil).
Directors' and Officers' shareholdings and options
The
beneficial ownership of ordinary share capital of Barclays PLC by
all Directors and Officers of Barclays PLC (involving 22 persons)
at 31 December 2017 amounted to 12,460,877 (2016: 11,464,580)
ordinary shares of 25p each (0.07% of the ordinary share capital
outstanding).
At 31
December 2017, executive Directors and Officers of Barclays PLC
(involving 11 persons) held options to purchase a total of 6,000
(2016: 22,527) Barclays PLC ordinary shares of 25p each at a price
of 120p under Sharesave.
Advances and credit to Directors and guarantees on behalf of
Directors
In
accordance with Section 413 of the Companies Act 2006, the total
amount of advances and credits made available in 2017 to persons
who served as Directors during the year was £0.2m (2016:
£0.2m). The total value of guarantees entered into on behalf
of Directors during 2017 was £nil (2016:
£nil).
Directors' responsibility statement
The
Directors have responsibility for ensuring that the Company and the
Group keep accounting records which disclose with reasonable
accuracy the financial position of the Company and the Group and
which enable them to ensure that the accounts comply with the
Companies Act 2006.
The
Directors are also responsible for preparing a Strategic Report,
Directors' Report, Directors' Remuneration Report and Corporate
Governance Statement in accordance with applicable law and
regulations.
The
Directors are responsible for the maintenance and integrity of the
Annual Report and Financial Statements as they appear on the
Company's website. Legislation in the UK governing the preparation
and dissemination of financial statements may differ from
legislation in other jurisdictions.
The
Directors have a general responsibility for taking such steps as
are reasonably open to them to safeguard the assets of the Group
and Company and to prevent and detect fraud and other
irregularities.
The
Directors, whose names and functions are set out on pages 47 and
48, confirm to the best of their knowledge that:
a)
the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair view
of the assets, liabilities, financial position and profit or loss
of the Company and the undertakings included in the consolidation
taken as a whole; and
b)
the management report, on page 4 to 37, which is incorporated in
the Directors' Report, includes a fair review of the development
and performance of the business and the position of the Company and
the undertakings included in the consolidation taken as a whole,
together with a description of the principal risks and
uncertainties that they face.
By
order of the Board
Stephen Shapiro
Company
Secretary
21
February 2018
Barclays
PLC
Registered
in England.
Company
No. 48839
- Ends -
For
further information, please contact:
|
Investor
Relations
|
Media Relations
|
|
Kathryn
McLeland
|
Tom
Hoskin
|
|
+44 (0)
20 7116 4943
|
+44 (0)
20 7116 6927
|
About Barclays
Barclays
is a transatlantic consumer and wholesale bank offering products
and services across personal, corporate and investment banking,
credit cards and wealth management, with a strong presence in our
two home markets of the UK and the US.
With
over 325 years of history and expertise in banking, Barclays
operates in over 40 countries and employs approximately 85,000
people. Barclays moves, lends, invests and protects money for
customers and clients worldwide.
For further information about Barclays, please visit our
website
www.barclays.com
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
This
document contains certain forward-looking statements within the
meaning of Section 21E of the US Securities Exchange Act of 1934,
as amended, and Section 27A of the US Securities Act of 1933, as
amended, with respect to the Group. Barclays cautions readers that
no forward-looking statement is a guarantee of future performance
and that actual results or other financial condition or performance
measures could differ materially from those contained in the
forward-looking statements. These forward-looking statements can be
identified by the fact that they do not relate only to historical
or current facts. Forward-looking statements sometimes use words
such as 'may', 'will', 'seek', 'continue', 'aim', 'anticipate',
'target', 'projected', 'expect', 'estimate', 'intend', 'plan',
'goal', 'believe', 'achieve' or other words of similar meaning.
Examples of forward-looking statements include, among others,
statements or guidance regarding or relating to the Group's future
financial position, income growth, assets, impairment charges,
provisions, business strategy, structural reform, capital, leverage
and other regulatory ratios, payment of dividends (including
dividend payout ratios and expected payment strategies), projected
levels of growth in the banking and financial markets, projected
costs or savings, any commitments and targets and the impact of any
regulatory deconsolidation resulting from the sell down of the
Group's interest in Barclays Africa Group Limited, estimates of
capital expenditures and plans and objectives for future
operations, projected employee numbers, IFRS 9 impacts and other
statements that are not historical fact. By their nature,
forward-looking statements involve risk and uncertainty because
they relate to future events and circumstances. These may be
affected by changes in legislation, the development of standards
and interpretations under International Financial Reporting
Standards including the implementation of IFRS 9, evolving
practices with regard to the interpretation and application of
accounting and regulatory standards, the outcome of current and
future legal proceedings and regulatory investigations, future
levels of conduct provisions, the policies and actions of
governmental and regulatory authorities, geopolitical risks and the
impact of competition. In addition, factors including (but not
limited to) the following may have an effect: capital, leverage and
other regulatory rules (including with regard to the future
structure of the Group) applicable to past, current and future
periods; UK, US, Africa, Eurozone and global macroeconomic and
business conditions; the effects of continued volatility in credit
markets; market related risks such as changes in interest rates and
foreign exchange rates; effects of changes in valuation of credit
market exposures; changes in valuation of issued securities;
volatility in capital markets; changes in credit ratings of any
entities within the Group or any securities issued by such
entities; the potential for one or more countries exiting the
Eurozone; the implications of the exercise by the United Kingdom of
Article 50 of the Treaty of Lisbon and the disruption that may
result in the UK and globally from the withdrawal of the United
Kingdom from the European Union and the success of future
acquisitions, disposals and other strategic transactions. A number
of these influences and factors are beyond the Group's control. As
a result, the Group's actual future results, dividend payments, and
capital and leverage ratios may differ materially from the plans,
goals, expectations and guidance set forth in the Group's
forward-looking statements. Additional risks and factors which may
impact the Group's future financial condition and performance are
identified in our filings with the SEC (including, without
limitation, our annual report on form 20-F for the fiscal year
ended 31 December 2017), which will be available on the SEC's
website at www.sec.gov.
Subject
to our obligations under the applicable laws and regulations of the
United Kingdom and the United States in relation to disclosure and
ongoing information, we undertake no obligation to update publicly
or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.