SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
|
BARCLAYS
PLC
|
|
(Registrant)
|
Date:
August 01, 2019
|
By: /s/
Karen Rowe
--------------------------------
|
|
Karen
Rowe
|
|
Assistant
Secretary
|
Barclays PLC
Interim Results Announcement
30 June
2019
Table of Contents
Results Announcement
|
Page
|
Notes
|
1
|
Performance
Highlights
|
2-3
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Group
Chief Executive Officer’s Review
|
4
|
Group
Finance Director’s Review
|
5-6
|
Results
by Business
|
|
●
Barclays
UK
|
7-9
|
●
Barclays
International
|
10-13
|
●
Head
Office
|
14
|
Quarterly
Results Summary
|
15
|
Quarterly
Results by Business
|
16-21
|
Performance Management
|
|
●
Margins
and Balances
|
22
|
Risk Management
|
|
●
Risk
Management and Principal Risks
|
23
|
●
Credit
Risk
|
24-33
|
●
Market
Risk
|
34
|
●
Treasury
and Capital Risk
|
35-46
|
Statement
of Directors’ Responsibilities
|
47
|
Independent
Review Report to Barclays PLC
|
48
|
Condensed
Consolidated Financial Statements
|
49-54
|
Financial
Statement Notes
|
55-83
|
Appendix: Non-IFRS
Performance Measures
|
84-93
|
Shareholder
Information
|
94
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BARCLAYS PLC, 1 CHURCHILL PLACE, LONDON, E14 5HP, UNITED KINGDOM.
TELEPHONE: +44 (0) 20 7116 1000. COMPANY NO. 48839.
Notes
The
terms Barclays or Barclays Group refer to Barclays PLC together
with its subsidiaries. Unless otherwise stated, the income
statement analysis compares the six months ended 30 June 2019 to
the corresponding six months of 2018 and balance sheet analysis as
at 30 June 2019 with comparatives relating to 31 December 2018 and
30 June 2018. The abbreviations ‘£m’ and
‘£bn’ represent millions and thousands of millions
of Pounds Sterling respectively; the abbreviations ‘$m’
and ‘$bn’ represent millions and thousands of millions
of US Dollars respectively; and the abbreviations
‘€m’ and ‘€bn’ represent
millions and thousands of millions of Euros
respectively.
There
are a number of key judgement areas, for example impairment
calculations, which are based on models and which are subject to
ongoing adjustment and modifications. Reported numbers reflect best
estimates and judgements at the given point in time.
Relevant
terms that are used in this document but are not defined under
applicable regulatory guidance or International Financial Reporting
Standards (IFRS) are explained in the results glossary that can be
accessed at
home.barclays/investor-relations/reports-and-events/latest-financial-results
.
The
information in this announcement, which was approved by the Board
of Directors on 31 July 2019, does not comprise statutory accounts
within the meaning of Section 434 of the Companies Act 2006.
Statutory accounts for the year ended 31 December 2018, which
contained an unmodified audit report under Section 495 of the
Companies Act 2006 (which did not make any statements under Section
498 of the Companies Act 2006) have been delivered to the Registrar
of Companies in accordance with Section 441 of the Companies Act
2006.
These
results will be furnished as a Form 6-K to the US Securities and
Exchange Commission (SEC) as soon as practicable following their
publication. Once furnished with the SEC, a copy of the Form 6-K
will be available from the SEC’s website at
www.sec.gov
.
Barclays
is a frequent issuer in the debt capital markets and regularly
meets with investors via formal road-shows and other ad hoc
meetings. Consistent with its usual practice, Barclays expects that
from time to time over the coming quarter it will meet with
investors globally to discuss these results and other matters
relating to the Barclays Group.
Non-IFRS performance measures
Barclays
management believes that the non-IFRS performance measures included
in this document provide valuable information to the readers of the
financial statements as they enable the reader to identify a more
consistent basis for comparing the businesses’ performance
between financial periods and provide more detail concerning the
elements of performance which the managers of these businesses are
most directly able to influence or are relevant for an assessment
of the Barclays Group. They also reflect an important aspect of the
way in which operating targets are defined and performance is
monitored by Barclays management. However, any non-IFRS performance
measures in this document are not a substitute for IFRS measures
and readers should consider the IFRS measures as well. Refer to the
appendix on pages 84 to 93 for further information and calculations
of non-IFRS performance measures included throughout this document,
and the most directly comparable IFRS measures.
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 Barclays 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 Barclays Group’s future financial
position, income growth, assets, impairment charges, provisions,
business strategy, 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, estimates of capital expenditures, plans and objectives
for future operations, projected employee numbers, IFRS 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 IFRS including 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
applicable to past, current and future periods; UK, US, Eurozone
and global macroeconomic and business conditions; the effects of
any 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 Barclays Group
or any securities issued by such entities; the potential for one or
more countries exiting the Eurozone; instability as a result of the
exit by the UK from the European Union and the disruption that may
subsequently result in the UK and globally; and the success of
future acquisitions, disposals and other strategic transactions. A
number of these influences and factors are beyond the Barclays
Group’s control. As a result, the Barclays 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 Barclays Group’s
forward-looking statements. Additional risks and factors which may
impact the Barclays 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 2018), which are available on the
SEC’s website at
www.sec.gov
.
Subject
to our obligations under the applicable laws and regulations of the
UK and the US 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.
Performance Highlights
Resilient performance with Group return on tangible equity of
9.4%
1
and an increased half year dividend of
3.0p per share
●
Barclays reported a
Group return on tangible equity (RoTE) of 9.4% for the first half
of 2019 and continues to target RoTE of >9% and >10% for 2019
and 2020 respectively
1
|
●
The income
environment in the first half was challenging and as a result
Barclays is focused on net cost reductions in the second half and
expects to reduce costs for 2019 to
below the £13.6bn
1
low
end of the Group’s previous cost guidance
|
●
Barclays will pay a
half year dividend of 3.0p (H118: 2.5p) and is reiterating its
capital returns policy
|
Returns
1
Group
RoTE targets of >9% in 2019 and >10% in 2020
|
●
Profit
before tax of £3.1bn (H118: £3.7bn) and earnings per
share (EPS) of 12.6p (H118: 14.9p)
|
●
Group
RoTE of 9.4% (H118: 11.6%)
|
-
Barclays UK RoTE of
15.1% (H118: 17.3%)
|
-
Barclays
International RoTE of 10.7% (H118: 12.9%), with the Corporate and
Investment Bank (CIB) RoTE of 9.4% (H118: 11.1%)
and Consumer, Cards and Payments of 16.7% (H118:
22.7%)
|
Cost efficiency
Group
cost guidance of below £13.6bn
1
in 2019
Cost:
income ratio of <60% over time
|
●
Group
operating expenses
1
increased
1% to £6.8bn, resulting in a cost: income ratio of 63% (H118:
61%),
reflecting continued investment in the business offset by lower
compensation accruals and cost efficiencies
|
●
Cost
control is a priority and, given the challenging income environment
experienced in the first half,
management expects to reduce 2019 costs below
£13.6bn
1
|
Capital and dividends
CET1
ratio target of c.13%
|
●
Common
equity tier 1 (CET1) ratio of 13.4% (December 2018: 13.2%) was
above the Group’s target ratio of c.13%.
The reported CET1 ratio increased 40bps in the second
quarter
|
●
Reiterating capital
returns policy, incorporating a progressive ordinary dividend,
supplemented by share buybacks as and when
appropriate.
Dividends will continue to be paid semi-annually,
with
the half year dividend expected to represent, under normal
circumstances,
around one-third of the total dividend for the year
|
●
Half
year dividend of 3.0p per share to be paid on 23 September 2019
(H118: 2.5p)
|
●
|
Barclays Group profit before tax was £3.0bn (H118:
£1.7bn) and excluding litigation and conduct, was £3.1bn
(H118: £3.7bn).
The cost:
income ratio was 63% (H118: 61%), with income down 1%, driven
mainly by margin pressure in Barclays UK and lower income in
Barclays International, while costs increased 1%, reflecting
continued investment in the business. Credit impairment charges
increased to £0.9bn (H118: £0.6bn) reflecting
the
non-recurrence of favourable US macroeconomic forecast updates and
single name recoveries in H118
, while
delinquencies in unsecured lending remained
stable
|
●
|
Barclays UK profit before tax was £1.1bn (H118:
£0.8bn).
Excluding litigation and conduct, profit
before tax was £1.1bn (H118: £1.2bn). Income declined 2%,
as continuing margin pressure was partially offset by continued
growth in mortgages and deposits. Operating expenses increased 2%
as digital investment was partially offset by cost efficiency
savings
|
●
|
Barclays International profit before tax was £2.3bn (H118:
£2.7bn).
Income was down 1% driven by a reduction in
CIB, reflecting reduced client activity, lower volatility and a
smaller Banking fee pool across the industry
2
, offset by growth in
Consumer, Cards and Payments. Operating expenses increased 1% as
continued investment in the business was partially offset by
reduced variable compensation accruals, reflecting performance in
the CIB. Credit impairment charges increased from £0.2bn to
£0.5bn, due to the non-recurrence of favourable US
macroeconomic forecast updates and single name recoveries in
H118
|
●
|
Attributable profit was £2.1bn (H118: £0.6bn).
This reflected the non-recurrence of Q118 litigation and conduct
charges of £2.0bn, principally relating to the Residential
Mortgage Backed Securities settlement (RMBS) and Payment Protection
Insurance (PPI). Excluding litigation and conduct, attributable
profit was £2.2bn (H118: £2.6bn), generating basic
earnings per share of 12.6p (H118: 14.9p)
|
●
|
Tangible net asset value (TNAV) per share was 275p (December 2018:
262p)
as 12.6p of EPS, excluding litigation and conduct, and
positive net reserve movements, were partially offset by payment of
the remaining full year 2018 dividend of 4p in the second
quarter
|
1
|
Excluding litigation and conduct, with returns targets based on a
Barclays Group CET1 ratio of c.13%. Group cost guidance is based on
a rate of 1.27 (USD/GBP) and subject to foreign currency
movements.
|
2
|
Data Source: Dealogic for the period covering 1 January to 30 June
2019
|
Barclays Group results
|
|
for the half year ended
|
30.06.19
|
30.06.18
|
|
|
£m
|
£m
|
% Change
|
Total income
|
10,790
|
10,934
|
(1)
|
Credit impairment charges and other provisions
|
(928)
|
(571)
|
(63)
|
Net operating income
|
9,862
|
10,363
|
(5)
|
Operating expenses
|
(6,758)
|
(6,674)
|
(1)
|
Litigation and conduct
|
(114)
|
(2,042)
|
94
|
Total operating expenses
|
(6,872)
|
(8,716)
|
21
|
Other net income
|
24
|
12
|
|
Profit before tax
|
3,014
|
1,659
|
82
|
Tax charge
1
|
(545)
|
(644)
|
15
|
Profit after tax
|
2,469
|
1,015
|
|
Non-controlling interests
|
(34)
|
(108)
|
69
|
Other equity instrument holders
|
(363)
|
(346)
|
(5)
|
Attributable profit
|
2,072
|
561
|
|
|
|
|
|
Performance measures
|
|
|
|
Return on average tangible shareholders' equity
|
9.1%
|
2.6%
|
|
Average tangible shareholders' equity (£bn)
|
45.7
|
43.8
|
|
Cost: income ratio
|
64%
|
80%
|
|
Loan loss rate (bps)
|
54
|
35
|
|
Basic earnings per share
|
12.1p
|
3.3p
|
|
Dividend per share
|
3.0p
|
2.5p
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
2
|
|
|
|
Profit before tax
|
3,128
|
3,701
|
(15)
|
Attributable profit
|
2,158
|
2,550
|
(15)
|
Return on average tangible shareholders' equity
|
9.4%
|
11.6%
|
|
Cost: income ratio
|
63%
|
61%
|
|
Basic earnings per share
|
12.6p
|
14.9p
|
|
|
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
As at 30.06.18
|
Balance sheet and capital
management
3
|
£bn
|
£bn
|
£bn
|
Tangible net asset value per share
|
275p
|
262p
|
259p
|
Common equity tier 1 ratio
|
13.4%
|
13.2%
|
13.0%
|
Common equity tier 1 capital
|
42.9
|
41.1
|
41.4
|
Risk weighted assets
|
319.1
|
311.9
|
319.3
|
Average UK leverage ratio
|
4.7%
|
4.5%
|
4.6%
|
UK leverage ratio
|
5.1%
|
5.1%
|
4.9%
|
|
|
|
|
Funding and liquidity
|
|
|
|
Group liquidity pool (£bn)
|
238
|
227
|
214
|
Liquidity coverage ratio
|
156%
|
169%
|
154%
|
Loan: deposit ratio
|
82%
|
83%
|
83%
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to Additional Tier 1 (AT1) instruments has been recognised
in the tax charge of the income statement, whereas it was
previously recorded in retained earnings. Comparatives have been
restated, reducing the tax charge for H118 by £93m. This
change does not impact earnings per share or return on average
tangible shareholders’ equity. Further detail can be found in
Note 1, Basis of preparation on pages 55 to 56.
|
2
|
Refer to pages 84 to 93 for further information and calculations of
performance measures excluding litigation and conduct
|
3
|
Capital, Risk Weighted Assets (RWAs) and leverage measures are
calculated applying the transitional arrangements of the Capital
Requirements Regulation (CRR) as amended by the Capital
Requirements Regulation II (CRR II) applicable as at the reporting
date. This includes IFRS 9 transitional arrangements. For more
information on the implementation of CRR II see page
40.
|
4
|
The fully loaded CET1 ratio was 13.1%, with £41.7bn of CET1
capital and £319.0bn of RWAs, calculated without applying the
transitional arrangements of the CRR as amended by CRR II
applicable as at the reporting date.
|
Group Chief Executive Officer’s Review
“This was another resilient quarter of
performance.
For the second quarter in succession Barclays generated an
attributable profit of over £1 billion, and delivered EPS of
12.6p for the first half of 2019.
Our Group Return on Tangible Equity of 9.3% for the quarter is a
further step towards meeting our 2019 RoTE target of greater than
9%.
Our reported CET1 ratio increased by 40 basis points in Q2 to
13.4%, demonstrating the strong capital generation capacity of the
business.
Barclays UK continued to build its mortgage and deposit balances,
with stable credit metrics. This has partially offset the reduction
in net interest margin from increased levels of customer
refinancing, and lower interest earnings from UK cards balances.
Digital engagement with our UK customers is at an all time high,
with just under 8 million customers now digitally active on the
Barclays App.
The Corporate & Investment Bank produced a 9.3% return in the
quarter, and we saw market outperformance in Banking fees and in
Fixed income, Currencies and Credit.
Consumer, Cards & Payments continues to progress, producing an
RoTE of 18% in the quarter and 16.7%for the half year.
Management focus on cost control remains a priority, and we expect
to reduce expenses to below £13.6 billion for
2019.
This all puts us in a position to continue to increase the return
of capital to shareholders by declaring a half year dividend of 3
pence. The half year dividend is around a third of what we expect
to pay in total in a given year under normal circumstances. This
increase in ordinary dividend reflects the confidence that the
Board and management have in the sustainable earnings generation of
our business.
Barclays’ progressive capital returns policy, and intention
to supplement the ordinary dividend with additional cash returns,
including share buybacks when appropriate, remains
unchanged.”
James E Staley, Group Chief Executive Officer
Group Finance Director’s Review
The
Group return on tangible equity, excluding litigation and conduct,
was 9.4% with earnings per share of 12.6p. Barclays continues to
target RoTE of >9% and >10% for 2019 and 2020
respectively
1
. Given the
challenging income environment experienced in the first half of the
year, achieving net cost reductions in the second half is a key
priority.
Group performance
●
|
Profit
before tax was £3,014m (H118: £1,659m). Excluding
litigation and conduct, profit before tax was £3,128m (H118:
£3,701m), reflecting the challenging income environment and an
increase in impairment due to the non-recurrence of favourable US
macroeconomic forecast updates and single name recoveries in H118.
The 7% appreciation of average USD against GBP positively impacted
income and profits and adversely impacted credit impairment charges
and operating expenses
|
●
|
Total
income decreased 1% to £10,790m. Barclays UK income decreased
2% as continued mortgage and deposit balance growth was offset by
margin compression and maintaining a reduced risk appetite in UK
cards. Barclays International income was down 1%, as the
challenging income environment resulted in a 1% reduction in CIB,
offset by a 2% increase in Consumer, Cards and
Payments
|
●
|
Credit
impairment charges increased to £928m (H118: £571m)
primarily due to the non-recurrence of favourable US macroeconomic
forecast updates and single name recoveries in H118. The economic
environment continued to be benign and there were no changes in the
macroeconomic variables used in impairment modelling in the first
half. Delinquencies in unsecured lending remained stable,
reflecting the continued prudent management of credit risk. The
Barclays Group loan loss rate was 54bps (H118: 35bps)
|
●
|
Operating
expenses increased 1% to £6,758m reflecting continued
investment in the business including planned digitisation of
Barclays UK, partially offset by lower variable compensation
accruals in CIB and cost efficiencies. The cost: income ratio,
excluding litigation and conduct, increased to 63% (H118:
61%)
|
●
|
The
effective tax rate was 18.1%. This reflects a change in accounting
standards requiring tax relief on payments made under Additional
Tier 1 (AT1) instruments, which in prior periods was recognised in
retained earnings, to be recognised in the income
statement
|
●
|
Attributable
profit was £2,072m (H118: £561m). Excluding litigation
and conduct, attributable profit was £2,158m (H118:
£2,550m), generating a RoTE of 9.4% (H118: 11.6%) and EPS of
12.6p (H118: 14.9p)
|
●
|
TNAV
per share was 275p (December 2018: 262p) as 12.6p of EPS, excluding
litigation and conduct, and positive net reserve movements, were
partially offset by payment of the remaining full year 2018
dividend of 4p in the second quarter
|
Group capital and leverage
●
|
The
CET1 ratio increased to 13.4% (December 2018: 13.2%) primarily
driven by a £1.8bn increase in CET1 capital partially offset
by an increase of £7.2bn in Risk Weighted Assets (RWAs)
compared to year-end 2018
|
-
CET1
capital increased by £1.8bn to £42.9bn driven by
underlying profit generation of £2.4bn and an increase of
£0.5bn in the fair value through other comprehensive income
reserve, primarily due to decreasing bond yields.
These increases were partially offset by £1.2bn dividends paid
and foreseen and £0.3bn from pension deficit reduction
contributions
|
-
The
increase in RWAs was primarily driven by increased CIB activity
compared to year-end 2018
|
●
|
The average UK leverage ratio increased to 4.7% (December 2018:
4.5%) primarily driven by an increase in Tier 1 (T1) capital, which
included the accretion of CET1 capital and the issuance of AT1
securities, partially offset by a modest increase in exposure to
£1,135bn (December 2018: £1,110bn). The UK leverage ratio
remained stable at 5.1% (December 2018: 5.1%)
|
Group funding and liquidity
●
|
The
liquidity pool increased to £238bn (December 2018:
£227bn) reflecting the Group’s prudent liquidity
management approach. The liquidity coverage ratio (LCR) remained
well above the 100% regulatory requirement at 156% (December 2018:
169%), equivalent to a surplus of £83bn (December 2018:
£90bn). The decrease in the LCR and surplus reflects support
for seasonal activity, while maintaining a conservative liquidity
position
|
●
|
Wholesale
funding outstanding, excluding repurchase agreements, was
£166bn (December 2018: £154bn). The Group issued
£7.1bn equivalent of minimum requirement for own funds and
eligible liabilities (MREL) instruments year-to-date from Barclays
PLC (the Parent company). The Group is well advanced in its MREL
issuance plans, with a Barclays PLC MREL ratio of 30.2% as at 30
June 2019 relative to an estimated requirement including requisite
buffers of 29.9% by 1 January 2022
|
1
|
Excluding litigation and conduct, with returns targets based on a
Barclays Group CET1 ratio of c.13%. Group cost guidance is based on
a rate of 1.27 (USD/GBP) and subject to foreign currency
movements.
|
Other matters
●
|
The
remaining PPI provision as at 30 June 2019 was £0.4bn
(December 2018: £0.9bn). This represents Barclays best
estimate of expected PPI related costs. However, the uncertainty
associated with future claims levels has increased ahead of the
Financial Conduct Authority (FCA) complaints deadline on 29 August
2019
|
●
|
Following
regulatory approval, Barclays intends to call the three AT1
instruments eligible for call on 15 September 2019. The redemptions
will result in a pro-forma decrease of c.13bps to the 30 June 2019
CET1 ratio due to two of these instruments being held on the
balance sheet at historical FX rates
|
Outlook and guidance
●
|
The
Group continues to target 2019 and 2020 RoTE of >9% and >10%
respectively
1
|
●
|
Given
the challenging income environment experienced in the first half,
management expects to reduce 2019 costs below
£13.6bn
1
|
Dividends
●
|
Barclays
existing capital returns policy as set out in our Full Year 2018
results remains unchanged:
|
|
|
“Barclays understands the importance of delivering attractive
cash returns to shareholders. Barclays is therefore committed to
maintaining an appropriate balance between total cash returns to
shareholders, investment in the business and maintaining a strong
capital position. Going forward, Barclays intends to pay a
progressive ordinary dividend, taking into account these objectives
and the earnings outlook of the Group. It is also the Board’s
intention to supplement the ordinary dividends with additional cash
returns, including share buybacks, to shareholders as and when
appropriate.”
|
●
|
Reflecting
this, Barclays will pay a half year dividend per share of 3.0p on
23 September 2019 (H118: 2.5p)
|
●
|
Dividends
will continue to be paid semi-annually, with the half year dividend
expected to represent, under normal circumstances, around one-third
of the total dividend for the year
|
Tushar Morzaria, Group Finance Director
1
|
Excluding litigation and conduct, with returns targets based on a
Barclays Group CET1 ratio of c.13%. Group cost guidance is based on
a rate of 1.27 (USD/GBP) and subject to foreign currency
movements.
|
Results by Business
Barclays UK
|
Half year ended
|
Half year ended
|
|
30.06.19
|
30.06.18
|
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
2,907
|
2,986
|
(3)
|
Net fee, commission and other income
|
641
|
638
|
-
|
Total income
|
3,548
|
3,624
|
(2)
|
Credit impairment charges and other provisions
|
(421)
|
(415)
|
(1)
|
Net operating income
|
3,127
|
3,209
|
(3)
|
Operating expenses
|
(2,021)
|
(1,973)
|
(2)
|
Litigation and conduct
|
(44)
|
(414)
|
89
|
Total operating expenses
|
(2,065)
|
(2,387)
|
13
|
Other net income
|
-
|
4
|
|
Profit before tax
|
1,062
|
826
|
29
|
Attributable profit
1
|
750
|
447
|
68
|
|
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
As at 30.06.18
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances to customers at amortised cost
|
189.1
|
187.6
|
185.3
|
Total assets
|
259.0
|
249.7
|
245.9
|
Customer deposits at amortised cost
|
200.9
|
197.3
|
194.3
|
Loan: deposit ratio
|
97%
|
96%
|
96%
|
Risk weighted assets
|
76.2
|
75.2
|
75.0
|
Period end allocated tangible equity
|
10.3
|
10.2
|
10.2
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Key facts
|
30.06.19
|
30.06.18
|
|
Average loan to value of mortgage portfolio
2
|
50%
|
50%
|
|
Average loan to value of new mortgage lending
2
|
67%
|
64%
|
|
Number of branches
|
972
|
1,155
|
|
Mobile banking active customers
|
7.9m
|
6.7m
|
|
30 day arrears rate - Barclaycard Consumer UK
|
1.8%
|
1.9%
|
|
|
|
|
|
Performance measures
|
|
|
|
Return on average allocated tangible equity
|
14.5%
|
9.0%
|
|
Average allocated tangible equity (£bn)
|
10.3
|
10.0
|
|
Cost: income ratio
|
58%
|
66%
|
|
Loan loss rate (bps)
|
43
|
44
|
|
Net interest margin
|
3.11%
|
3.24%
|
|
|
|
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
3
|
£m
|
£m
|
% Change
|
Profit before tax
|
1,106
|
1,240
|
(11)
|
Attributable profit
|
782
|
859
|
(9)
|
Return on average allocated tangible equity
|
15.1%
|
17.3%
|
|
Cost: income ratio
|
57%
|
54%
|
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Average loan to value of mortgages is balance weighted and reflects
both residential and buy-to-let mortgage portfolios.
|
3
|
Refer to pages 84 to 93 for further information and calculations of
performance measures excluding litigation and conduct.
|
Analysis of Barclays UK
|
Half year ended
|
Half year ended
|
|
30.06.19
|
30.06.18
|
|
Analysis of total income
|
£m
|
£m
|
% Change
|
Personal Banking
|
1,910
|
1,987
|
(4)
|
Barclaycard Consumer UK
|
987
|
1,031
|
(4)
|
Business Banking
|
651
|
606
|
7
|
Total income
|
3,548
|
3,624
|
(2)
|
|
|
|
|
Analysis of credit impairment charges and other
provisions
|
|
|
|
Personal Banking
|
(88)
|
(121)
|
27
|
Barclaycard Consumer UK
|
(315)
|
(252)
|
(25)
|
Business Banking
|
(18)
|
(42)
|
57
|
Total credit impairment charges and other provisions
|
(421)
|
(415)
|
(1)
|
|
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
As at 30.06.18
|
Analysis of loans and advances to customers at amortised
cost
|
£bn
|
£bn
|
£bn
|
Personal Banking
|
147.3
|
146.0
|
143.6
|
Barclaycard Consumer UK
|
15.1
|
15.3
|
15.2
|
Business Banking
|
26.7
|
26.3
|
26.5
|
Total loans and advances to customers at amortised
cost
|
189.1
|
187.6
|
185.3
|
|
|
|
|
Analysis of customer deposits at amortised cost
|
|
|
|
Personal Banking
|
156.3
|
154.0
|
152.9
|
Barclaycard Consumer UK
|
-
|
-
|
-
|
Business Banking
|
44.6
|
43.3
|
41.4
|
Total customer deposits at amortised cost
|
200.9
|
197.3
|
194.3
|
Barclays
UK continued to deliver growth in balances during H119, increasing
mortgage lending by £1.8bn and growing customer deposits by
£3.6bn. Ongoing margin pressure from increased refinancing
activity in mortgages and lower interest earning lending (IEL) in
UK cards, resulted in a lower net interest margin (NIM). Digital
investment continues to transform customer
interactions.
Income statement – H119 compared to H118
●
|
Profit
before tax, excluding litigation and conduct, decreased 11% to
£1,106m. RoTE was robust at 15.1% (H118: 17.3%) reflecting the
continuing strength of the Barclays UK business in a challenging
income environment. Including litigation and conduct charges of
£44m (H118: £414m) that decreased primarily due to the
non-recurrence of a PPI charge, profit before tax increased 29% to
£1,062m
|
●
|
Total
income decreased 2% to £3,548m due to a 3% decrease in net
interest income (NII) to £2,907m
|
-
Personal Banking
income decreased 4% to £1,910m, reflecting ongoing mortgage
margin pressure, partially offset by mortgage and deposit balance
growth and improved liability margins
|
-
Barclaycard
Consumer UK income decreased 4% to £987m reflecting the
maintenance of a reduced risk appetite, which resulted in a lower
level of IEL balances
|
-
Business Banking
income increased 7% to £651m driven by continued deposit
growth, improved liability margins and the non-recurrence of client
remediation in H118
|
-
NIM
decreased 13bps to 3.11% reflecting increased refinancing activity
by mortgage customers, lower IEL in UK cards and the mix effect
from growth in secured lending
|
●
|
Credit
impairment charges were broadly flat at £421m (H118:
£415m), with releases on single name exposures in Business
Banking offsetting higher charges in UK cards due to the embedment
of IFRS 9 in H118. The 30 and 90 day arrears rates in UK cards
remained stable at 1.8% (H118: 1.9%) and 0.9% (H118: 0.9%)
respectively
|
●
|
Operating
expenses increased 2% to £2,021m as planned digital investment
in the business and inflation outweighed cost efficiencies. The
cost: income ratio, excluding litigation and conduct, was 57%
(H118: 54%)
|
Balance sheet – 30 June 2019 compared to 31 December
2018
●
|
Loans
and advances to customers at amortised cost increased 1% to
£189.1bn reflecting £1.8bn of mortgage
growth
|
●
|
Total
assets increased 4% to £259.0bn reflecting increases in the
liquidity pool and loans and advances to customers
|
●
|
Customer
deposits at amortised cost increased 2% to £200.9bn
demonstrating franchise strength across both Personal and Business
Banking
|
●
|
RWAs
increased to £76.2bn (December 2018: £75.2bn) including
the recognition of property leases following IFRS 16
implementation, growth in Mortgages and Business Banking and change
in mix of the liquidity pool
|
Barclays International
|
Half year ended
|
Half year ended
|
|
30.06.19
|
30.06.18
|
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
1,917
|
1,866
|
3
|
Net trading income
|
2,160
|
2,510
|
(14)
|
Net fee, commission and other income
|
3,396
|
3,139
|
8
|
Total income
|
7,473
|
7,515
|
(1)
|
Credit impairment charges and other provisions
|
(492)
|
(161)
|
|
Net operating income
|
6,981
|
7,354
|
(5)
|
Operating expenses
|
(4,641)
|
(4,606)
|
(1)
|
Litigation and conduct
|
(30)
|
(62)
|
52
|
Total operating expenses
|
(4,671)
|
(4,668)
|
-
|
Other net income
|
31
|
24
|
29
|
Profit before tax
|
2,341
|
2,710
|
(14)
|
Attributable profit
1
|
1,620
|
1,933
|
(16)
|
|
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
As at 30.06.18
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
134.8
|
127.2
|
125.5
|
Trading portfolio assets
|
120.0
|
104.0
|
116.5
|
Derivative financial instrument assets
|
243.8
|
222.1
|
228.2
|
Financial assets at fair value through the income
statement
|
154.7
|
144.7
|
141.2
|
Cash collateral and settlement balances
|
101.3
|
74.3
|
91.5
|
Other assets
|
196.8
|
189.8
|
183.6
|
Total assets
|
951.4
|
862.1
|
886.5
|
Deposits at amortised cost
|
212.0
|
197.2
|
191.0
|
Derivative financial instrument liabilities
|
243.0
|
219.6
|
224.9
|
Loan: deposit ratio
|
64%
|
65%
|
66%
|
Risk weighted assets
|
214.8
|
210.7
|
218.0
|
Period end allocated tangible equity
|
30.2
|
29.9
|
30.5
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Performance measures
|
30.06.19
|
30.06.18
|
|
Return on average allocated tangible equity
|
10.5%
|
12.6%
|
|
Average allocated tangible equity (£bn)
|
30.8
|
30.7
|
|
Cost: income ratio
|
63%
|
62%
|
|
Loan loss rate (bps)
|
72
|
25
|
|
Net interest margin
|
3.95%
|
4.30%
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
2
|
£m
|
£m
|
% Change
|
Profit before tax
|
2,371
|
2,772
|
(14)
|
Attributable profit
|
1,644
|
1,979
|
(17)
|
Return on average allocated tangible equity
|
10.7%
|
12.9%
|
|
Cost: income ratio
|
62%
|
61%
|
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Refer to pages 84 to 93 for further information and calculations of
performance measures excluding litigation and conduct.
|
Analysis of Barclays International
|
|
|
|
Corporate and Investment Bank
|
Half year ended
|
Half year ended
|
|
30.06.19
|
30.06.18
|
|
Income statement information
|
£m
|
£m
|
% Change
|
FICC
|
1,822
|
1,605
|
14
|
Equities
|
984
|
1,191
|
(17)
|
Markets
|
2,806
|
2,796
|
-
|
Banking fees
|
1,267
|
1,387
|
(9)
|
Corporate lending
|
368
|
438
|
(16)
|
Transaction banking
|
859
|
799
|
8
|
Corporate
|
1,227
|
1,237
|
(1)
|
Other
|
-
|
(41)
|
|
Total income
|
5,300
|
5,379
|
(1)
|
Credit impairment (charges)/releases and other
provisions
|
(96)
|
182
|
|
Net operating income
|
5,204
|
5,561
|
(6)
|
Operating expenses
|
(3,479)
|
(3,546)
|
2
|
Litigation and conduct
|
(26)
|
(13)
|
|
Total operating expenses
|
(3,505)
|
(3,559)
|
2
|
Other net income
|
15
|
8
|
88
|
Profit before tax
|
1,714
|
2,010
|
(15)
|
Attributable profit
1
|
1,178
|
1,434
|
(18)
|
|
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
As at 30.06.18
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
92.1
|
86.4
|
87.8
|
Trading portfolio assets
|
119.9
|
104.0
|
116.5
|
Derivative financial instrument assets
|
243.7
|
222.1
|
228.1
|
Financial assets at fair value through the income
statement
|
154.1
|
144.2
|
140.7
|
Cash collateral and settlement balances
|
100.4
|
73.4
|
90.6
|
Other assets
|
168.1
|
160.4
|
151.6
|
Total assets
|
878.3
|
790.5
|
815.3
|
Deposits at amortised cost
|
145.4
|
136.3
|
130.3
|
Derivative financial instrument liabilities
|
242.9
|
219.6
|
224.9
|
Risk weighted assets
|
175.9
|
170.9
|
180.4
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Performance measures
|
30.06.19
|
30.06.18
|
|
Return on average allocated tangible equity
|
9.3%
|
11.0%
|
|
Average allocated tangible equity (£bn)
|
25.5
|
26.0
|
|
Cost: income ratio
|
66%
|
66%
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
2
|
£m
|
£m
|
% Change
|
Profit before tax
|
1,740
|
2,023
|
(14)
|
Attributable profit
|
1,199
|
1,444
|
(17)
|
Return on average allocated tangible equity
|
9.4%
|
11.1%
|
|
Cost: income ratio
|
66%
|
66%
|
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Refer to pages 84 to 93 for more information and calculations of
performance measures excluding litigation and conduct.
|
Analysis of Barclays International
|
|
|
|
Consumer, Cards and Payments
|
Half year ended
|
Half year ended
|
|
30.06.19
|
30.06.18
|
|
Income statement information
|
£m
|
£m
|
% Change
|
Total income
|
2,173
|
2,136
|
2
|
Credit impairment charges and other provisions
|
(396)
|
(343)
|
(15)
|
Net operating income
|
1,777
|
1,793
|
(1)
|
Operating expenses
|
(1,162)
|
(1,060)
|
(10)
|
Litigation and conduct
|
(4)
|
(49)
|
92
|
Total operating expenses
|
(1,166)
|
(1,109)
|
(5)
|
Other net income
|
16
|
16
|
-
|
Profit before tax
|
627
|
700
|
(10)
|
Attributable profit
1
|
442
|
499
|
(11)
|
|
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
As at 30.06.18
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
42.7
|
40.8
|
37.7
|
Total assets
|
73.1
|
71.6
|
71.2
|
Deposits at amortised cost
|
66.6
|
60.9
|
60.7
|
Risk weighted assets
|
38.9
|
39.8
|
37.6
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Key facts
|
30.06.19
|
30.06.18
|
|
30 day arrears rate – Barclaycard US
|
2.4%
|
2.5%
|
|
Total number of Barclaycard business clients
|
383,382
|
370,000
|
|
Value of payments processed (£bn)
|
174
|
169
|
|
|
|
|
|
Performance measures
|
|
|
|
Return on average allocated tangible equity
|
16.6%
|
21.2%
|
|
Average allocated tangible equity (£bn)
|
5.3
|
4.7
|
|
Cost: income ratio
|
54%
|
52%
|
|
Loan loss rate (bps)
|
176
|
171
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
2
|
£m
|
£m
|
% Change
|
Profit before tax
|
631
|
749
|
(16)
|
Attributable profit
|
445
|
535
|
(17)
|
Return on average allocated tangible equity
|
16.7%
|
22.7%
|
|
Cost: income ratio
|
53%
|
50%
|
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Refer to pages 84 to 93 for more information and calculations of
performance measures excluding litigation and conduct.
|
In
H119, Barclays International delivered double-digit returns despite
a challenging income environment. CIB income reflected a positive
performance in FICC and Transaction Banking, offset by a decrease
in Equities and lower Banking fees, which was impacted by a decline
in the Banking fee pool across the industry
1
, compared to a
strong H118. Credit impairment charges normalised in the CIB.
Barclays International operating expenses increased, driven by
Consumer, Cards and Payments, including investment in US cards,
merchant acquiring and wealth. This was offset by lower
compensation accruals within CIB.
Income statement – H119 compared to H118
●
|
Profit
before tax, excluding litigation and conduct, decreased 14% to
£2,371m resulting in a RoTE of 10.7% (H118: 12.9%), reflecting
returns in the CIB of 9.4% (H118: 11.1%) and Consumer, Cards and
Payments of 16.7% (H118: 22.7%)
|
●
|
The 7%
appreciation of average USD against GBP positively impacted profits
and income, and adversely impacted credit impairment charges and
operating expenses
|
●
|
Total
income decreased to £7,473m (H118: £7,515m)
|
|
-
CIB income of
£5,300m decreased 1% as positive performance in FICC and
Transaction Banking was offset by the impact of a lower Banking fee
pool across the industry
1
and
reduced client activity in Equities.
Markets income was in line at £2,806m, Banking fees income
decreased 9% to £1,267m and Corporate income decreased 1% to
£1,227m
|
|
-
Within
Markets, FICC income increased 14% to £1,822m. Excluding the
£166m strategic investment gain on the initial public offering
of Tradeweb, FICC income increased 3% reflecting a strong
performance in rates
and growth in securitised products.
Equities income
decreased 17% to £984m driven by equity derivatives, which was
impacted by reduced client activity
|
|
-
Banking fees income
decreased 9% to £1,267m driven by lower debt underwriting fees
reflecting a reduced Banking fee pool
1
, offset by an increase in advisory
fees.
However, Barclays share of the global Banking fee pool has
increased since FY18
1
|
|
-
Within Corporate,
Transaction banking income increased 8% to £859m reflecting
growth in deposits. This was offset by a decrease in Corporate
lending income to £368m (H118: £438m).
Excluding mark-to-market movements on loan hedges, Corporate
lending income was stable at c.£400m
|
|
-
Consumer, Cards and
Payments income increased 2% to £2,173m reflecting balance
growth in the US cards business, partnership growth in merchant
acquiring and appreciation of
USD against GBP, offset by the non-recurrence of a £53m gain
on the sale of a US cards portfolio in H118
|
●
|
Credit
impairment charges increased to £492m (H118:
£161m)
|
|
-
CIB
credit impairment charges increased to £96m (H118: release of
£182m) due to the non-recurrence of favourable macroeconomic
forecast updates and single name recoveries in H118
|
|
-
Consumer, Cards and
Payments credit impairment charges increased to £396m (H118:
£343m) due to the non-recurrence of favourable US
macroeconomic forecast updates in H118.
Credit metrics were stable, with US cards 30 and 90 day arrears of
2.4% (H118: 2.5%) and 1.3% (H118: 1.3%) respectively
|
●
|
Operating
expenses increased 1% to £4,641m as continued investment in
the business was offset by variable compensation accruals which
were reduced in response to performance in Q119
|
|
-
CIB
operating expenses decreased 2% to £3,479m as variable
compensation accruals were reduced in response to performance in
Q119 partially offset by continued investment in the
business
|
|
-
Consumer, Cards and
Payments operating expenses increased 10% to £1,162m driven by
continued investment in US cards, merchant acquiring and
wealth
|
Balance sheet – 30 June 2019 compared to 31 December
2018
●
|
Total
assets of £951.4bn increased by £89.3bn compared to
year-end 2018
|
●
|
Trading
portfolio assets increased £16.0bn to £120.0bn and cash
collateral and settlement balances increased £27.0bn to
£101.3bn, both due to increased trading activity compared to
year-end 2018
|
●
|
Derivative
financial instrument assets and liabilities increased £21.7bn
to £243.8bn and £23.4bn to £243.0bn respectively
driven by a decrease in major interest rate curves, principally in
the second quarter
|
●
|
Financial
assets at fair value through the income statement increased
£10.0bn to £154.7bn due to increased secured lending
compared to year-end 2018
|
●
|
Deposits
at amortised cost increased £14.8bn to £212.0bn due to
increased customer deposits
|
●
|
RWAs
increased to £214.8bn (December 2018: £210.7bn), driven
by increased CIB activity compared to year-end 2018
|
1
|
Data Source: Dealogic for the period covering 1 January to 30 June
2019
|
Head Office
|
Half year ended
|
Half year ended
|
|
30.06.19
|
30.06.18
|
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
(206)
|
(474)
|
57
|
Net fee, commission and other income
|
(25)
|
269
|
|
Total income
|
(231)
|
(205)
|
(13)
|
Credit impairment (charges)/releases and other
provisions
|
(15)
|
5
|
|
Net operating income
|
(246)
|
(200)
|
(23)
|
Operating expenses
|
(96)
|
(95)
|
(1)
|
Litigation and conduct
|
(40)
|
(1,566)
|
97
|
Total operating expenses
|
(136)
|
(1,661)
|
92
|
Other net expenses
|
(7)
|
(16)
|
56
|
Loss before tax
|
(389)
|
(1,877)
|
79
|
Attributable loss
1
|
(298)
|
(1,819)
|
84
|
|
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
As at 30.06.18
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Total assets
|
22.4
|
21.5
|
17.2
|
Risk weighted assets
|
28.1
|
26.0
|
26.3
|
Period end allocated tangible equity
|
7.0
|
4.9
|
3.6
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Performance measures
|
30.06.19
|
30.06.18
|
|
Average allocated tangible equity (£bn)
|
4.6
|
3.1
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
2
|
£m
|
£m
|
% Change
|
Loss before tax
|
(349)
|
(311)
|
(12)
|
Attributable loss
|
(268)
|
(288)
|
7
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Refer to pages 84 to 93 for further
information and calculations of performance measures excluding
litigation and conduct
.
|
Income statement – H119 compared to H118
●
|
Loss
before tax, excluding litigation and conduct, was £349m (H118:
£311m). Including litigation and conduct charges of £40m
(H118: £1,566m) that decreased primarily due to the
non-recurrence of the RMBS settlement, loss before tax was
£389m (H118: £1,877m)
|
●
|
Total
income was an expense of £231m (H118: £205m) which
included legacy capital instrument funding costs, and hedge
accounting expenses partially offset by the recognition of
dividends on Barclays stake in Absa Group Limited. Income expense
increased on prior year reflecting the non-recurrence of a
£155m one-off gain from the settlement of receivables relating
to the Lehman Brothers acquisition, partially offset by lower net
expenses from treasury operations
|
●
|
Operating
expenses, excluding litigation and conduct, were £96m (H118:
£95m)
|
Balance sheet – 30 June 2019 compared to 31 December
2018
●
|
Total
assets increased to £22.4bn (December 2018: £21.5bn) and
RWAs increased to £28.1bn (December 2018: £26.0bn) driven
by recognition of property leases following IFRS 16
implementation
|
●
|
Period
end allocated tangible equity increased to £7.0bn (December
2018: £4.9bn) mainly due to the Group’s CET1 ratio being
above the 13.0% target which is used in the allocation of equity to
the businesses
|
Quarterly Results Summary
Barclays Group
|
|
|
|
|
|
|
|
|
|
|
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
2,360
|
2,258
|
|
2,296
|
2,388
|
2,190
|
2,188
|
|
2,272
|
2,475
|
Net fee, commission and other income
|
3,178
|
2,994
|
|
2,777
|
2,741
|
3,386
|
3,170
|
|
2,750
|
2,698
|
Total income
|
5,538
|
5,252
|
|
5,073
|
5,129
|
5,576
|
5,358
|
|
5,022
|
5,173
|
Credit impairment charges and other provisions
|
(480)
|
(448)
|
|
(643)
|
(254)
|
(283)
|
(288)
|
|
(573)
|
(709)
|
Net operating income
|
5,058
|
4,804
|
|
4,430
|
4,875
|
5,293
|
5,070
|
|
4,449
|
4,464
|
Operating costs
|
(3,501)
|
(3,257)
|
|
(3,624)
|
(3,329)
|
(3,310)
|
(3,364)
|
|
(3,621)
|
(3,274)
|
UK bank levy
|
-
|
-
|
|
(269)
|
-
|
-
|
-
|
|
(365)
|
-
|
Operating expenses
|
(3,501)
|
(3,257)
|
|
(3,893)
|
(3,329)
|
(3,310)
|
(3,364)
|
|
(3,986)
|
(3,274)
|
Guaranteed Minimum Pensions (GMP) charge
|
-
|
-
|
|
(140)
|
-
|
-
|
-
|
|
-
|
-
|
Litigation and conduct
|
(53)
|
(61)
|
|
(60)
|
(105)
|
(81)
|
(1,961)
|
|
(383)
|
(81)
|
Total operating expenses
|
(3,554)
|
(3,318)
|
|
(4,093)
|
(3,434)
|
(3,391)
|
(5,325)
|
|
(4,369)
|
(3,355)
|
Other net income/(expenses)
|
27
|
(3)
|
|
37
|
20
|
(7)
|
19
|
|
13
|
(2)
|
Profit/(loss) before tax
|
1,531
|
1,483
|
|
374
|
1,461
|
1,895
|
(236)
|
|
93
|
1,107
|
Tax charge
1
|
(297)
|
(248)
|
|
(83)
|
(192)
|
(386)
|
(258)
|
|
(1,089)
|
(281)
|
Profit/(loss) after tax
|
1,234
|
1,235
|
|
291
|
1,269
|
1,509
|
(494)
|
|
(996)
|
826
|
Non-controlling interests
|
(17)
|
(17)
|
|
(75)
|
(43)
|
(55)
|
(53)
|
|
(68)
|
(43)
|
Other equity instrument holders
|
(183)
|
(180)
|
|
(230)
|
(176)
|
(175)
|
(171)
|
|
(181)
|
(157)
|
Attributable
profit/(loss)
1
|
1,034
|
1,038
|
|
(14)
|
1,050
|
1,279
|
(718)
|
|
(1,245)
|
626
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity
|
9.0%
|
9.2%
|
|
(0.1%)
|
9.4%
|
11.8%
|
(6.5%)
|
|
(10.3%)
|
5.1%
|
Average tangible shareholders' equity (£bn)
|
46.2
|
45.2
|
|
44.3
|
44.6
|
43.5
|
44.2
|
|
48.1
|
48.9
|
Cost: income ratio
|
64%
|
63%
|
|
81%
|
67%
|
61%
|
99%
|
|
87%
|
65%
|
Loan loss rate (bps)
2
|
56
|
54
|
|
77
|
30
|
35
|
36
|
|
56
|
66
|
Basic earnings/(loss) per share
|
6.0p
|
6.1p
|
|
(0.1p)
|
6.1p
|
7.5p
|
(4.2p)
|
|
(7.3p)
|
3.7p
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
3
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Profit before tax
|
1,584
|
1,544
|
|
434
|
1,566
|
1,976
|
1,725
|
|
476
|
1,188
|
Attributable profit/(loss)
|
1,074
|
1,084
|
|
48
|
1,135
|
1,338
|
1,212
|
|
(894)
|
703
|
Return on average tangible shareholders' equity
|
9.3%
|
9.6%
|
|
0.4%
|
10.2%
|
12.3%
|
11.0%
|
|
(7.4%)
|
5.7%
|
Cost: income ratio
|
63%
|
62%
|
|
79%
|
65%
|
59%
|
63%
|
|
79%
|
63%
|
Basic earnings/(loss) per share
|
6.3p
|
6.3p
|
|
0.3p
|
6.6p
|
7.8p
|
7.1p
|
|
(5.3p)
|
4.1p
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet and capital
management
4
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Total assets
|
1,232.8
|
1,193.5
|
|
1,133.3
|
1,170.8
|
1,149.6
|
1,142.2
|
|
1,133.2
|
1,149.3
|
Tangible net asset value per share
|
275p
|
266p
|
|
262p
|
260p
|
259p
|
251p
|
|
276p
|
281p
|
Common equity tier 1 ratio
|
13.4%
|
13.0%
|
|
13.2%
|
13.2%
|
13.0%
|
12.7%
|
|
13.3%
|
13.1%
|
Common equity tier 1 capital
|
42.9
|
41.4
|
|
41.1
|
41.7
|
41.4
|
40.2
|
|
41.6
|
42.3
|
Risk weighted assets
|
319.1
|
319.7
|
|
311.9
|
316.2
|
319.3
|
317.9
|
|
313.0
|
324.3
|
Average UK leverage ratio
|
4.7%
|
4.6%
|
|
4.5%
|
4.6%
|
4.6%
|
4.6%
|
|
4.9%
|
4.9%
|
Average UK leverage exposure
|
1,134.6
|
1,105.5
|
|
1,110.0
|
1,119.0
|
1,081.8
|
1,089.9
|
|
1,044.6
|
1,035.1
|
UK leverage ratio
|
5.1%
|
4.9%
|
|
5.1%
|
4.9%
|
4.9%
|
4.8%
|
|
5.1%
|
5.1%
|
UK leverage exposure
|
1,079.4
|
1,065.0
|
|
998.6
|
1,063.5
|
1,030.1
|
1,030.8
|
|
984.7
|
1,002.1
|
|
|
|
|
|
|
|
|
|
|
|
Funding and liquidity
|
|
|
|
|
|
|
|
|
|
|
Group liquidity (£bn)
|
238
|
232
|
|
227
|
213
|
214
|
207
|
|
220
|
216
|
Liquidity coverage ratio
|
156%
|
160%
|
|
169%
|
161%
|
154%
|
147%
|
|
154%
|
157%
|
Loan : deposit ratio
|
82%
|
80%
|
|
83%
|
83%
|
83%
|
84%
|
|
81%
|
80%
|
|
|
|
|
|
|
|
|
|
|
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Prior to Q118 comparatives calculated based on gross loans and
advances at amortised cost before the balance sheet presentation
change and IAS 39 impairment charge.
|
3
|
Refer to pages 84 to 93 for further information and calculations of
performance measures excluding litigation and conduct.
|
4
|
Capital, RWAs and leverage measures are calculated applying the
transitional arrangements of the CRR as amended by CRR II
applicable as at the reporting date. This includes IFRS 9
transitional arrangements. For more information on the
implementation of CRR II see page 40.
|
Quarterly Results by Business
Barclays UK
|
|
|
|
|
|
|
|
|
|
|
|
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
|
Q317
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
|
£m
|
Net interest income
|
1,438
|
1,469
|
|
1,513
|
1,529
|
1,493
|
1,493
|
|
1,540
|
|
1,501
|
Net fee, commission and other income
|
333
|
308
|
|
350
|
367
|
343
|
295
|
|
330
|
|
351
|
Total income
|
1,771
|
1,777
|
|
1,863
|
1,896
|
1,836
|
1,788
|
|
1,870
|
|
1,852
|
Credit impairment charges and other provisions
|
(230)
|
(191)
|
|
(296)
|
(115)
|
(214)
|
(201)
|
|
(184)
|
|
(201)
|
Net operating income
|
1,541
|
1,586
|
|
1,567
|
1,781
|
1,622
|
1,587
|
|
1,686
|
|
1,651
|
Operating costs
|
(1,022)
|
(999)
|
|
(1,114)
|
(988)
|
(968)
|
(1,005)
|
|
(1,117)
|
|
(980)
|
UK bank levy
|
-
|
-
|
|
(46)
|
-
|
-
|
-
|
|
(59)
|
|
-
|
Litigation and conduct
|
(41)
|
(3)
|
|
(15)
|
(54)
|
(3)
|
(411)
|
|
(53)
|
|
(11)
|
Total operating expenses
|
(1,063)
|
(1,002)
|
|
(1,175)
|
(1,042)
|
(971)
|
(1,416)
|
|
(1,229)
|
|
(991)
|
Other net (expenses)/income
|
(1)
|
1
|
|
(2)
|
1
|
5
|
(1)
|
|
(5)
|
|
1
|
Profit before tax
|
477
|
585
|
|
390
|
740
|
656
|
170
|
|
452
|
|
661
|
Attributable profit/(loss)
1
|
328
|
422
|
|
241
|
510
|
473
|
(26)
|
|
258
|
|
432
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
|
£bn
|
Loans and advances to customers at amortised cost
|
189.1
|
187.5
|
|
187.6
|
186.7
|
185.3
|
184.3
|
|
183.8
|
|
182.2
|
Total assets
|
259.0
|
253.1
|
|
249.7
|
252.0
|
245.9
|
235.2
|
|
237.4
|
|
230.4
|
Customer deposits at amortised cost
|
200.9
|
197.3
|
|
197.3
|
195.8
|
194.3
|
192.0
|
|
193.4
|
|
189.3
|
Loan: deposit ratio
|
97%
|
96%
|
|
96%
|
96%
|
96%
|
96%
|
|
95%
|
|
97%
|
Risk weighted assets
|
76.2
|
76.6
|
|
75.2
|
74.8
|
75.0
|
72.5
|
|
70.9
|
|
70.0
|
Period end allocated tangible equity
|
10.3
|
10.5
|
|
10.2
|
10.1
|
10.2
|
9.8
|
|
9.6
|
|
9.5
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
12.7%
|
16.3%
|
|
9.6%
|
20.1%
|
18.8%
|
(1.1%)
|
|
10.7%
|
|
18.4%
|
Average allocated tangible equity (£bn)
|
10.3
|
10.4
|
|
10.1
|
10.1
|
10.1
|
9.8
|
|
9.6
|
|
9.4
|
Cost: income ratio
|
60%
|
56%
|
|
63%
|
55%
|
53%
|
79%
|
|
66%
|
|
54%
|
Loan loss rate (bps)
2
|
47
|
40
|
|
61
|
24
|
45
|
43
|
|
39
|
|
43
|
Net interest margin
|
3.05%
|
3.18%
|
|
3.20%
|
3.22%
|
3.22%
|
3.27%
|
|
3.32%
|
|
3.28%
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
3
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
|
£m
|
Profit before tax
|
518
|
588
|
|
405
|
794
|
659
|
581
|
|
505
|
|
672
|
Attributable profit
|
358
|
424
|
|
253
|
558
|
474
|
385
|
|
295
|
|
440
|
Return on average allocated tangible equity
|
13.9%
|
16.4%
|
|
10.1%
|
22.0%
|
18.8%
|
15.7%
|
|
12.3%
|
|
18.7%
|
Cost: income ratio
|
58%
|
56%
|
|
62%
|
52%
|
53%
|
56%
|
|
63%
|
|
53%
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Prior to Q118 comparatives calculated based on gross loans and
advances at amortised cost before the balance sheet presentation
change and IAS 39 impairment charge.
|
3
|
Refer to pages 84 to 93 for further information and calculations of
performance measures excluding litigation and conduct.
|
Analysis of Barclays UK
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Analysis of total income
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Personal Banking
|
946
|
964
|
|
998
|
1,021
|
1,015
|
972
|
|
1,116
|
1,022
|
Barclaycard Consumer UK
|
497
|
490
|
|
522
|
551
|
504
|
527
|
|
445
|
539
|
Business Banking
|
328
|
323
|
|
343
|
324
|
317
|
289
|
|
309
|
291
|
Total income
|
1,771
|
1,777
|
|
1,863
|
1,896
|
1,836
|
1,788
|
|
1,870
|
1,852
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of credit impairment (charges)/releases and other
provisions
|
|
|
|
|
|
|
|
|
|
|
Personal Banking
|
(36)
|
(52)
|
|
(44)
|
(8)
|
(49)
|
(72)
|
|
(56)
|
(57)
|
Barclaycard Consumer UK
|
(175)
|
(140)
|
|
(250)
|
(88)
|
(139)
|
(113)
|
|
(124)
|
(145)
|
Business Banking
|
(19)
|
1
|
|
(2)
|
(19)
|
(26)
|
(16)
|
|
(4)
|
1
|
Total credit impairment charges and other provisions
|
(230)
|
(191)
|
|
(296)
|
(115)
|
(214)
|
(201)
|
|
(184)
|
(201)
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of loans and advances to customers at amortised
cost
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Personal Banking
|
147.3
|
145.9
|
|
146.0
|
145.4
|
143.6
|
142.1
|
|
141.3
|
140.4
|
Barclaycard Consumer UK
|
15.1
|
15.0
|
|
15.3
|
15.3
|
15.2
|
15.2
|
|
16.4
|
16.3
|
Business Banking
|
26.7
|
26.6
|
|
26.3
|
26.0
|
26.5
|
27.0
|
|
26.1
|
25.5
|
Total loans and advances to customers at amortised
cost
|
189.1
|
187.5
|
|
187.6
|
186.7
|
185.3
|
184.3
|
|
183.8
|
182.2
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of customer deposits at amortised cost
|
|
|
|
|
|
|
|
|
|
|
Personal Banking
|
156.3
|
154.1
|
|
154.0
|
153.4
|
152.9
|
151.9
|
|
153.1
|
152.1
|
Barclaycard Consumer UK
|
-
|
-
|
|
-
|
-
|
-
|
-
|
|
-
|
-
|
Business Banking
|
44.6
|
43.2
|
|
43.3
|
42.4
|
41.4
|
40.1
|
|
40.3
|
37.2
|
Total customer deposits at amortised cost
|
200.9
|
197.3
|
|
197.3
|
195.8
|
194.3
|
192.0
|
|
193.4
|
189.3
|
Barclays International
|
|
|
|
|
|
|
|
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
1,017
|
900
|
|
984
|
965
|
853
|
1,013
|
|
987
|
1,148
|
Net trading income
|
1,016
|
1,144
|
|
837
|
1,103
|
1,094
|
1,416
|
|
935
|
815
|
Net fee, commission and other income
|
1,870
|
1,526
|
|
1,400
|
1,222
|
1,760
|
1,379
|
|
1,397
|
1,352
|
Total income
|
3,903
|
3,570
|
|
3,221
|
3,290
|
3,707
|
3,808
|
|
3,319
|
3,315
|
Credit impairment charges and other provisions
|
(247)
|
(245)
|
|
(354)
|
(143)
|
(68)
|
(93)
|
|
(386)
|
(495)
|
Net operating income
|
3,656
|
3,325
|
|
2,867
|
3,147
|
3,639
|
3,715
|
|
2,933
|
2,820
|
Operating costs
|
(2,435)
|
(2,206)
|
|
(2,441)
|
(2,277)
|
(2,306)
|
(2,300)
|
|
(2,428)
|
(2,182)
|
UK bank levy
|
-
|
-
|
|
(210)
|
-
|
-
|
-
|
|
(265)
|
-
|
Litigation and conduct
|
(11)
|
(19)
|
|
(33)
|
(32)
|
(47)
|
(15)
|
|
(255)
|
(5)
|
Total operating expenses
|
(2,446)
|
(2,225)
|
|
(2,684)
|
(2,309)
|
(2,353)
|
(2,315)
|
|
(2,948)
|
(2,187)
|
Other net income
|
13
|
18
|
|
32
|
12
|
11
|
13
|
|
21
|
19
|
Profit before tax
|
1,223
|
1,118
|
|
215
|
850
|
1,297
|
1,413
|
|
6
|
652
|
Attributable profit/(loss)
1
|
832
|
788
|
|
(21)
|
687
|
926
|
1,007
|
|
(1,134)
|
391
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
134.8
|
130.9
|
|
127.2
|
132.4
|
125.5
|
117.5
|
|
126.8
|
134.4
|
Trading portfolio assets
|
120.0
|
117.2
|
|
104.0
|
124.6
|
116.5
|
114.9
|
|
113.0
|
91.2
|
Derivative financial instrument assets
|
243.8
|
217.3
|
|
222.1
|
214.8
|
228.2
|
214.1
|
|
236.2
|
242.8
|
Financial assets at fair value through the income
statement
|
154.7
|
153.5
|
|
144.7
|
147.8
|
141.2
|
150.6
|
|
104.1
|
103.7
|
Cash collateral and settlement balances
|
101.3
|
97.8
|
|
74.3
|
94.3
|
91.5
|
82.6
|
|
71.9
|
86.3
|
Other assets
|
196.8
|
202.3
|
|
189.8
|
186.3
|
183.6
|
186.9
|
|
204.1
|
208.7
|
Total assets
|
951.4
|
919.0
|
|
862.1
|
900.2
|
886.5
|
866.6
|
|
856.1
|
867.1
|
Deposits at amortised cost
|
212.0
|
215.5
|
|
197.2
|
200.3
|
191.0
|
167.2
|
|
187.3
|
191.9
|
Derivative financial instrument liabilities
|
243.0
|
213.5
|
|
219.6
|
213.7
|
224.9
|
210.8
|
|
237.8
|
242.9
|
Loan: deposit ratio
|
64%
|
61%
|
|
65%
|
66%
|
66%
|
70%
|
|
68%
|
70%
|
Risk weighted assets
|
214.8
|
216.1
|
|
210.7
|
214.6
|
218.0
|
214.2
|
|
210.3
|
218.2
|
Period end allocated tangible equity
|
30.2
|
30.6
|
|
29.9
|
30.2
|
30.5
|
30.0
|
|
27.5
|
28.0
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
10.7%
|
10.4%
|
|
(0.3%)
|
8.8%
|
11.8%
|
13.4%
|
|
(15.9%)
|
5.4%
|
Average allocated tangible equity (£bn)
|
31.1
|
30.5
|
|
31.3
|
31.1
|
31.4
|
30.1
|
|
28.5
|
28.9
|
Cost: income ratio
|
63%
|
62%
|
|
83%
|
70%
|
63%
|
61%
|
|
89%
|
66%
|
Loan loss rate (bps)
2
|
72
|
73
|
|
107
|
41
|
22
|
31
|
|
76
|
88
|
Net
interest margin
|
3.91%
|
3.99%
|
|
3.98%
|
3.87%
|
4.03%
|
4.57%
|
|
4.31%
|
4.21%
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
3
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Profit before tax
|
1,234
|
1,137
|
|
248
|
882
|
1,344
|
1,428
|
|
261
|
657
|
Attributable profit/(loss)
|
840
|
804
|
|
13
|
713
|
960
|
1,019
|
|
(884)
|
395
|
Return on average allocated tangible equity
|
10.8%
|
10.6%
|
|
0.2%
|
9.2%
|
12.2%
|
13.6%
|
|
(12.4%)
|
5.5%
|
Cost: income ratio
|
62%
|
62%
|
|
82%
|
69%
|
62%
|
60%
|
|
81%
|
66%
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Prior to Q118 comparatives calculated based on gross loans and
advances at amortised cost before the balance sheet presentation
change and IAS 39 impairment charge.
|
3
|
Refer to pages 84 to 93 for further information and calculations of
performance measures excluding litigation and conduct.
|
Analysis of Barclays International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate and Investment Bank
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
FICC
|
920
|
902
|
|
570
|
688
|
736
|
869
|
|
607
|
627
|
Equities
|
517
|
467
|
|
375
|
471
|
601
|
590
|
|
362
|
350
|
Markets
|
1,437
|
1,369
|
|
945
|
1,159
|
1,337
|
1,459
|
|
969
|
977
|
Banking fees
|
698
|
569
|
|
625
|
519
|
704
|
683
|
|
605
|
607
|
Corporate lending
|
216
|
152
|
|
243
|
197
|
198
|
240
|
|
269
|
277
|
Transaction banking
|
444
|
415
|
|
412
|
416
|
385
|
414
|
|
408
|
419
|
Corporate
|
660
|
567
|
|
655
|
613
|
583
|
654
|
|
677
|
696
|
Other
|
-
|
-
|
|
(74)
|
(56)
|
(44)
|
3
|
|
1
|
-
|
Total income
|
2,795
|
2,505
|
|
2,151
|
2,235
|
2,580
|
2,799
|
|
2,252
|
2,280
|
Credit impairment (charges)/releases and other
provisions
|
(44)
|
(52)
|
|
(35)
|
3
|
23
|
159
|
|
(127)
|
(36)
|
Net operating income
|
2,751
|
2,453
|
|
2,116
|
2,238
|
2,603
|
2,958
|
|
2,125
|
2,244
|
Operating costs
|
(1,860)
|
(1,619)
|
|
(1,835)
|
(1,712)
|
(1,773)
|
(1,773)
|
|
(1,885)
|
(1,656)
|
UK bank levy
|
-
|
-
|
|
(188)
|
-
|
-
|
-
|
|
(244)
|
-
|
Litigation and conduct
|
(7)
|
(19)
|
|
(23)
|
(32)
|
-
|
(13)
|
|
(255)
|
(5)
|
Total operating expenses
|
(1,867)
|
(1,638)
|
|
(2,046)
|
(1,744)
|
(1,773)
|
(1,786)
|
|
(2,384)
|
(1,661)
|
Other net income
|
3
|
12
|
|
15
|
4
|
5
|
3
|
|
7
|
10
|
Profit/(loss) before tax
|
887
|
827
|
|
85
|
498
|
835
|
1,175
|
|
(252)
|
593
|
Attributable profit/(loss)
1
|
596
|
582
|
|
(84)
|
431
|
600
|
834
|
|
(1,227)
|
368
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
92.1
|
90.6
|
|
86.4
|
93.3
|
87.8
|
81.3
|
|
88.2
|
95.4
|
Trading portfolio assets
|
119.9
|
117.2
|
|
104.0
|
124.5
|
116.5
|
114.9
|
|
112.9
|
91.1
|
Derivative financial instruments assets
|
243.7
|
217.3
|
|
222.1
|
214.8
|
228.1
|
214.2
|
|
236.1
|
242.7
|
Financial assets at fair value through the income
statement
|
154.1
|
152.9
|
|
144.2
|
147.3
|
140.7
|
150.2
|
|
103.8
|
103.4
|
Cash collateral and settlement balances
|
100.4
|
96.9
|
|
73.4
|
93.3
|
90.6
|
81.1
|
|
71.9
|
86.3
|
Other assets
|
168.1
|
163.2
|
|
160.4
|
153.8
|
151.6
|
159.8
|
|
175.8
|
179.9
|
Total assets
|
878.3
|
838.1
|
|
790.5
|
827.0
|
815.3
|
801.5
|
|
788.7
|
798.8
|
Deposits at amortised cost
|
145.4
|
151.4
|
|
136.3
|
137.6
|
130.3
|
107.6
|
|
128.0
|
133.4
|
Derivative financial instrument liabilities
|
242.9
|
213.5
|
|
219.6
|
213.7
|
224.9
|
210.9
|
|
237.7
|
242.8
|
Risk weighted assets
|
175.9
|
176.6
|
|
170.9
|
175.9
|
180.4
|
181.3
|
|
176.2
|
185.2
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
9.2%
|
9.3%
|
|
(1.3%)
|
6.6%
|
9.1%
|
13.0%
|
|
(20.2%)
|
5.9%
|
Average allocated tangible equity (£bn)
|
25.8
|
25.1
|
|
26.0
|
25.9
|
26.4
|
25.6
|
|
24.3
|
24.8
|
Cost: income ratio
|
67%
|
65%
|
|
95%
|
78%
|
69%
|
64%
|
|
106%
|
73%
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
2
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Profit before tax
|
894
|
846
|
|
108
|
530
|
835
|
1,188
|
|
3
|
598
|
Attributable profit/(loss)
|
601
|
598
|
|
(57)
|
456
|
600
|
844
|
|
(977)
|
372
|
Return on average allocated tangible equity
|
9.3%
|
9.5%
|
|
(0.9%)
|
7.0%
|
9.1%
|
13.2%
|
|
(16.1%)
|
6.0%
|
Cost: income ratio
|
67%
|
65%
|
|
94%
|
77%
|
69%
|
63%
|
|
95%
|
73%
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Refer to pages 84 to 93 for further information and calculations of
performance measures excluding litigation and conduct.
|
Analysis of Barclays International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer, Cards and Payments
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Total income
|
1,108
|
1,065
|
|
1,070
|
1,055
|
1,127
|
1,009
|
|
1,067
|
1,035
|
Credit impairment charges and other provisions
|
(203)
|
(193)
|
|
(319)
|
(146)
|
(91)
|
(252)
|
|
(259)
|
(459)
|
Net operating income
|
905
|
872
|
|
751
|
909
|
1,036
|
757
|
|
808
|
576
|
Operating costs
|
(575)
|
(587)
|
|
(606)
|
(565)
|
(533)
|
(527)
|
|
(543)
|
(526)
|
UK bank levy
|
-
|
-
|
|
(22)
|
-
|
-
|
-
|
|
(21)
|
-
|
Litigation and conduct
|
(4)
|
-
|
|
(10)
|
-
|
(47)
|
(2)
|
|
-
|
-
|
Total operating expenses
|
(579)
|
(587)
|
|
(638)
|
(565)
|
(580)
|
(529)
|
|
(564)
|
(526)
|
Other net income
|
10
|
6
|
|
17
|
8
|
6
|
10
|
|
14
|
9
|
Profit before tax
|
336
|
291
|
|
130
|
352
|
462
|
238
|
|
258
|
59
|
Attributable profit
1
|
236
|
206
|
|
63
|
256
|
326
|
173
|
|
93
|
23
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
42.7
|
40.3
|
|
40.8
|
39.1
|
37.7
|
36.2
|
|
38.6
|
39.0
|
Total assets
|
73.1
|
80.9
|
|
71.6
|
73.2
|
71.2
|
65.1
|
|
67.4
|
68.3
|
Deposits at amortised cost
|
66.6
|
64.1
|
|
60.9
|
62.7
|
60.7
|
59.6
|
|
59.3
|
58.5
|
Risk weighted assets
|
38.9
|
39.5
|
|
39.8
|
38.7
|
37.6
|
32.9
|
|
34.1
|
33.0
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
17.8%
|
15.4%
|
|
4.8%
|
19.8%
|
26.2%
|
15.6%
|
|
8.9%
|
2.2%
|
Average allocated tangible equity (£bn)
|
5.3
|
5.4
|
|
5.3
|
5.2
|
5.0
|
4.5
|
|
4.2
|
4.2
|
Cost: income ratio
|
52%
|
55%
|
|
60%
|
54%
|
51%
|
52%
|
|
53%
|
51%
|
Loan loss rate (bps)
2
|
180
|
182
|
|
290
|
138
|
90
|
263
|
|
255
|
446
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
3
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Profit before tax
|
340
|
291
|
|
140
|
352
|
509
|
240
|
|
258
|
59
|
Attributable profit
|
239
|
206
|
|
70
|
257
|
360
|
175
|
|
93
|
23
|
Return on average allocated tangible equity
|
18.0%
|
15.4%
|
|
5.4%
|
19.9%
|
28.9%
|
15.7%
|
|
9.0%
|
2.2%
|
Cost:income ratio
|
52%
|
55%
|
|
59%
|
54%
|
47%
|
52%
|
|
53%
|
51%
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Prior to Q118 comparatives calculated based on gross loans and
advances at amortised cost before the balance sheet presentation
change and IAS 39 impairment charge.
|
3
|
Refer to pages 84 to 93 for further information and calculations of
performance measures excluding litigation and conduct.
|
Head Office
|
|
|
|
|
|
|
|
|
|
|
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
(95)
|
(111)
|
|
(201)
|
(106)
|
(156)
|
(318)
|
|
(254)
|
(174)
|
Net fee, commission and other income
|
(41)
|
16
|
|
190
|
49
|
189
|
80
|
|
87
|
180
|
Total income
|
(136)
|
(95)
|
|
(11)
|
(57)
|
33
|
(238)
|
|
(167)
|
6
|
Credit impairment (charges)/releases and other
provisions
|
(3)
|
(12)
|
|
7
|
4
|
(1)
|
6
|
|
(3)
|
(13)
|
Net operating (expenses)/income
|
(139)
|
(107)
|
|
(4)
|
(53)
|
32
|
(232)
|
|
(170)
|
(7)
|
Operating costs
|
(44)
|
(52)
|
|
(69)
|
(64)
|
(36)
|
(59)
|
|
(76)
|
(112)
|
UK bank levy
|
-
|
-
|
|
(13)
|
-
|
-
|
-
|
|
(41)
|
-
|
GMP charge
|
-
|
-
|
|
(140)
|
-
|
-
|
-
|
|
-
|
-
|
Litigation and conduct
|
(1)
|
(39)
|
|
(12)
|
(19)
|
(31)
|
(1,535)
|
|
(75)
|
(65)
|
Total operating expenses
|
(45)
|
(91)
|
|
(234)
|
(83)
|
(67)
|
(1,594)
|
|
(192)
|
(177)
|
Other net income/(expenses)
|
15
|
(22)
|
|
7
|
7
|
(23)
|
7
|
|
(3)
|
(22)
|
Loss before tax
|
(169)
|
(220)
|
|
(231)
|
(129)
|
(58)
|
(1,819)
|
|
(365)
|
(206)
|
Attributable loss
1
|
(126)
|
(172)
|
|
(234)
|
(147)
|
(120)
|
(1,699)
|
|
(369)
|
(197)
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Total assets
|
22.4
|
21.4
|
|
21.5
|
18.6
|
17.2
|
40.4
|
|
39.7
|
51.7
|
Risk weighted assets
|
28.1
|
27.0
|
|
26.0
|
26.8
|
26.3
|
31.2
|
|
31.8
|
36.1
|
Period end allocated tangible equity
|
7.0
|
4.5
|
|
4.9
|
4.2
|
3.6
|
3.0
|
|
10.0
|
10.4
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Average allocated tangible equity (£bn)
|
4.8
|
4.3
|
|
2.9
|
3.4
|
2.0
|
4.3
|
|
10.0
|
10.5
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures excluding
litigation and conduct
2
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Loss before tax
|
(168)
|
(181)
|
|
(219)
|
(110)
|
(27)
|
(284)
|
|
(290)
|
(141)
|
Attributable loss
|
(124)
|
(144)
|
|
(218)
|
(136)
|
(96)
|
(192)
|
|
(305)
|
(132)
|
1
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously recorded in
retained earnings. Comparatives have been restated. This change
does not impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
2
|
Refer to pages 84 to 93 for further information and calculations of
performance measures excluding litigation and conduct.
|
Performance Management
Margins and balances
|
|
|
|
|
|
|
|
Half year ended 30.06.19
|
Half year ended 30.06.18
1
|
|
Net interest income
|
Average customer assets
|
Net interest margin
|
Net interest income
|
Average customer assets
|
Net interest margin
|
|
£m
|
£m
|
%
|
£m
|
£m
|
%
|
Barclays UK
|
2,907
|
188,377
|
3.11
|
2,986
|
185,666
|
3.24
|
Barclays International
2
|
1,947
|
99,478
|
3.95
|
2,027
|
95,170
|
4.30
|
Total Barclays UK and Barclays International
|
4,854
|
287,855
|
3.40
|
5,013
|
280,836
|
3.60
|
Other
3
|
(236)
|
|
|
(635)
|
|
|
Total Barclays Group
4
|
4,618
|
|
|
4,378
|
|
|
1
|
The Group’s treasury results are reported directly within
Barclays UK and Barclays International from Q218 following
ring-fencing, resulting in gains and losses made on certain
activities being
recognised as Other income, rather than in Net interest
income.
|
2
|
Barclays International margins include interest earning lending
balances within the investment banking business.
|
3
|
Other includes Head Office and non-lending related investment
banking businesses not included in Barclays International
margins.
|
4
|
The Group combined product and equity structural hedge notional as
at 30 June 2019 was £172bn, with an average duration of 2.5 to
3 years. Group net interest income includes gross
structural hedge contributions of £0.9bn (H118: £0.9bn)
and net structural hedge contributions of £0.2bn (H118:
£0.4bn). Gross structural hedge contributions represent the
absolute level
of interest earned from the fixed receipts on the basket of swaps
in the structural hedge, while the net structural hedge
contributions represent the net interest earned on the
difference
between the structural hedge rate and prevailing floating
rates.
|
Net
interest margin decreased 20bps to 3.40% primarily reflecting
ongoing margin pressure and maintenance of a reduced risk appetite
in UK cards, and the recategorisation of certain treasury income
following ring-fencing.
Quarterly analysis for Barclays UK and Barclays
International
|
Net interest income
|
Average customer assets
|
Net interest margin
|
Three months ended 30.06.19
|
£m
|
£m
|
%
|
Barclays UK
|
1,438
|
189,172
|
3.05
|
Barclays International
1
|
980
|
100,645
|
3.91
|
Total Barclays UK and Barclays International
|
2,418
|
289,817
|
3.35
|
|
|
|
|
Three months ended 31.03.19
|
|
|
|
Barclays UK
|
1,469
|
187,570
|
3.18
|
Barclays International
1
|
967
|
98,313
|
3.99
|
Total Barclays UK and Barclays International
|
2,436
|
285,883
|
3.46
|
|
|
|
|
Three months ended 31.12.18
|
|
|
|
Barclays UK
|
1,513
|
187,813
|
3.20
|
Barclays International
1
|
994
|
99,137
|
3.98
|
Total Barclays UK and Barclays International
|
2,507
|
286,950
|
3.47
|
|
|
|
|
Three months ended 30.09.18
|
|
|
|
Barclays UK
|
1,529
|
188,239
|
3.22
|
Barclays International
1
|
945
|
96,785
|
3.87
|
Total Barclays UK and Barclays International
|
2,474
|
285,024
|
3.44
|
|
|
|
|
Three months ended 30.06.18
|
|
|
|
Barclays UK
|
1,493
|
186,053
|
3.22
|
Barclays International
1
|
962
|
95,728
|
4.03
|
Total Barclays UK and Barclays International
|
2,455
|
281,781
|
3.49
|
1
|
Barclays International margins include interest earning lending
balances within the investment banking business.
|
Risk Management
Risk management and principal risks
The
roles and responsibilities of the business groups, Risk and
Compliance, in the management of risk in the firm are defined in
the Enterprise Risk Management Framework. The purpose of the
framework is to identify the principal risks of Barclays Group, the
process by which Barclays Group sets its appetite for these risks
in its business activities, and the consequent limits which it
places on related risk taking.
The framework identifies eight principal risks: credit risk; market
risk; treasury and capital risk; operational risk; model risk;
conduct risk; reputation risk; and legal risk. Further detail on
these risks and how they are managed is available in the Barclays
PLC Annual Report 2018 or online at
home.barclays/annualreport
.
There have been no significant changes to these principal risks or
previously identified material existing and emerging risks in the
period, including the risks associated with the process of the UK
withdrawal from the European Union which continue to be closely
monitored by Barclays Group. Impairment as at 30 June 2019
continues to include an adjustment of £150m representing the
estimated impact of anticipated economic uncertainty in the UK (for
further detail please see page 31). No significant changes to the
principal risks or previously identified material existing and
emerging risks are currently expected for the remaining six months
of the year.
The
following section gives an overview of credit risk, market risk,
and treasury and capital risk for the period.
Credit Risk
Loans and advances at amortised cost by stage
The
table below presents an analysis of loans and advances at amortised
cost by gross exposure, impairment allowance, impairment charge and
coverage ratio by stage allocation and business segment as at 30
June 2019. Also included are off-balance sheet loan commitments and
financial guarantee contracts by gross exposure, impairment
allowance and coverage ratio by stage allocation as at 30 June
2019. Barclays does not hold any material purchased or originated
credit impaired assets as at period-end.
|
Gross exposure
|
|
Impairment allowance
|
Net exposure
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
As at 30.06.19
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
Barclays UK
|
135,413
|
26,319
|
2,816
|
164,548
|
|
180
|
1,395
|
1,043
|
2,618
|
161,930
|
Barclays International
|
28,498
|
4,444
|
1,855
|
34,797
|
|
344
|
803
|
1,312
|
2,459
|
32,338
|
Head Office
|
6,121
|
611
|
897
|
7,629
|
|
8
|
46
|
314
|
368
|
7,261
|
Total Barclays Group retail
|
170,032
|
31,374
|
5,568
|
206,974
|
|
532
|
2,244
|
2,669
|
5,445
|
201,529
|
Barclays UK
|
27,640
|
3,775
|
1,213
|
32,628
|
|
14
|
50
|
115
|
179
|
32,449
|
Barclays International
|
91,954
|
9,826
|
1,592
|
103,372
|
|
146
|
257
|
465
|
868
|
102,504
|
Head Office
|
2,834
|
-
|
40
|
2,874
|
|
-
|
-
|
37
|
37
|
2,837
|
Total Barclays Group wholesale
|
122,428
|
13,601
|
2,845
|
138,874
|
|
160
|
307
|
617
|
1,084
|
137,790
|
Total loans and advances at amortised cost
|
292,460
|
44,975
|
8,413
|
345,848
|
|
692
|
2,551
|
3,286
|
6,529
|
339,319
|
Off-balance sheet loan commitments and financial guarantee
contracts
1
|
321,028
|
20,661
|
503
|
342,192
|
|
104
|
161
|
32
|
297
|
341,895
|
Total
2
|
613,488
|
65,636
|
8,916
|
688,040
|
|
796
|
2,712
|
3,318
|
6,826
|
681,214
|
|
|
|
|
|
|
|
|
|
|
|
|
As at 30.06.19
|
|
Half year ended 30.06.19
|
|
|
Coverage ratio
|
|
Loan impairment charge and loan loss
rate
3
|
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Loan impairment charge
|
Loan loss rate
|
|
|
%
|
%
|
%
|
%
|
|
£m
|
bps
|
|
Barclays UK
|
0.1
|
5.3
|
37.0
|
1.6
|
|
|
404
|
|
50
|
|
Barclays International
|
1.2
|
18.1
|
70.7
|
7.1
|
|
|
383
|
|
222
|
|
Head Office
|
0.1
|
7.5
|
35.0
|
4.8
|
|
|
15
|
|
40
|
|
Total Barclays Group retail
|
0.3
|
7.2
|
47.9
|
2.6
|
|
|
802
|
|
78
|
|
Barclays UK
|
0.1
|
1.3
|
9.5
|
0.5
|
|
|
8
|
|
5
|
|
Barclays International
|
0.2
|
2.6
|
29.2
|
0.8
|
|
|
82
|
|
16
|
|
Head Office
|
-
|
-
|
92.5
|
1.3
|
|
|
-
|
|
-
|
|
Total Barclays Group wholesale
|
0.1
|
2.3
|
21.7
|
0.8
|
|
|
90
|
|
13
|
|
Total loans and advances at amortised cost
|
0.2
|
5.7
|
39.1
|
1.9
|
|
|
892
|
|
52
|
|
Off-balance sheet loan commitments and financial guarantee
contracts
1
|
-
|
0.8
|
6.4
|
0.1
|
|
|
30
|
|
|
|
Other financial assets subject to impairment
2
|
|
|
|
|
|
|
6
|
|
|
|
Total
|
0.1
|
4.1
|
37.2
|
1.0
|
|
|
928
|
|
|
|
1
|
Excludes loan commitments
and
financial guarantees of £15.5bn carried at fair
value.
|
2
|
Other financial assets subject to impairment not included in the
table above include cash collateral and settlement balances,
financial assets at fair value through other comprehensive income
and other assets. These have a total gross exposure of
£178.7bn and impairment allowance of £22m. This comprises
£14m Expected Credit Loss (ECL) on £178.2bn stage 1
assets, £3m on £0.5bn stage 2 fair value through other
comprehensive income assets and £5m on £5m stage 3 other
assets.
|
3
|
H119 loan impairment charge represents six months of impairment
charge, annualised to calculate the loan loss rate. The loan loss
rate for H119 is 54bps after applying the total impairment charge
of £928m.
|
|
Gross exposure
|
|
Impairment allowance
|
Net exposure
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
As at 31.12.18
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
Barclays UK
|
134,911
|
25,279
|
3,040
|
163,230
|
|
183
|
1,389
|
1,152
|
2,724
|
160,506
|
Barclays International
|
26,714
|
4,634
|
1,830
|
33,178
|
|
352
|
965
|
1,315
|
2,632
|
30,546
|
Head Office
|
6,510
|
636
|
938
|
8,084
|
|
9
|
47
|
306
|
362
|
7,722
|
Total Barclays Group retail
|
168,135
|
30,549
|
5,808
|
204,492
|
|
544
|
2,401
|
2,773
|
5,718
|
198,774
|
Barclays UK
|
22,824
|
4,144
|
1,272
|
28,240
|
|
16
|
70
|
117
|
203
|
28,037
|
Barclays International
|
87,344
|
8,754
|
1,382
|
97,480
|
|
128
|
244
|
439
|
811
|
96,669
|
Head Office
|
2,923
|
-
|
41
|
2,964
|
|
-
|
-
|
38
|
38
|
2,926
|
Total Barclays Group wholesale
|
113,091
|
12,898
|
2,695
|
128,684
|
|
144
|
314
|
594
|
1,052
|
127,632
|
Total loans and advances at amortised cost
|
281,226
|
43,447
|
8,503
|
333,176
|
|
688
|
2,715
|
3,367
|
6,770
|
326,406
|
Off-balance sheet loan commitments and financial guarantee
contracts
1
|
309,989
|
22,126
|
684
|
332,799
|
|
99
|
150
|
22
|
271
|
332,528
|
Total
2
|
591,215
|
65,573
|
9,187
|
665,975
|
|
787
|
2,865
|
3,389
|
7,041
|
658,934
|
|
|
|
|
|
|
|
|
|
|
|
|
As at 31.12.18
|
|
Year ended 31.12.18
|
|
|
Coverage ratio
|
|
Loan impairment charge and loan loss rate
|
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Loan impairment charge
|
Loan loss rate
|
|
|
%
|
%
|
%
|
%
|
|
£m
|
|
bps
|
|
Barclays UK
|
0.1
|
5.5
|
37.9
|
1.7
|
|
|
830
|
|
51
|
|
Barclays International
|
1.3
|
20.8
|
71.9
|
7.9
|
|
|
844
|
|
254
|
|
Head Office
|
0.1
|
7.4
|
32.6
|
4.5
|
|
|
15
|
|
19
|
|
Total Barclays Group retail
|
0.3
|
7.9
|
47.7
|
2.8
|
|
|
1,689
|
|
83
|
|
Barclays UK
|
0.1
|
1.7
|
9.2
|
0.7
|
|
|
74
|
|
26
|
|
Barclays International
|
0.1
|
2.8
|
31.8
|
0.8
|
|
|
(142)
|
|
-
|
|
Head Office
|
-
|
-
|
92.7
|
1.3
|
|
|
(31)
|
|
-
|
|
Total Barclays Group wholesale
|
0.1
|
2.4
|
22.0
|
0.8
|
|
|
(99)
|
|
-
|
|
Total loans and advances at amortised cost
|
0.2
|
6.2
|
39.6
|
2.0
|
|
|
1,590
|
|
48
|
|
Off-balance sheet loan commitments and financial guarantee
contracts
1
|
-
|
0.7
|
3.2
|
0.1
|
|
|
(125)
|
|
|
|
Other financial assets subject to impairment
2
|
|
|
|
|
|
|
3
|
|
|
|
Total
|
0.1
|
4.4
|
36.9
|
1.1
|
|
|
1,468
|
|
|
|
1
|
Excludes loan commitments and financial guarantees of £11.7bn
carried at fair value.
|
2
|
Other financial assets subject to impairment not included in the
table above include cash collateral and settlement balances,
financial assets at fair value through other comprehensive income
and other assets. These have a total gross exposure of
£129.9bn and impairment allowance of £12m. This comprises
£10m ECL on £129.3bn stage 1 assets and £2m on
£0.6bn stage 2 fair value through other comprehensive income
assets.
|
Loans and advances at amortised cost by product
The
table below presents a breakdown of loans and advances at amortised
cost and the impairment allowance with stage allocation by asset
classification.
|
|
Stage 2
|
|
|
As at 30.06.19
|
Stage 1
|
Not past due
|
<=30 days past due
|
>30 days past due
|
Total
|
Stage 3
|
Total
|
Gross exposure
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Home loans
|
130,559
|
16,640
|
1,636
|
792
|
19,068
|
2,393
|
152,020
|
Credit cards, unsecured loans and other retail lending
|
47,591
|
11,205
|
529
|
460
|
12,194
|
3,574
|
63,359
|
Corporate loans
|
114,310
|
12,033
|
619
|
1,061
|
13,713
|
2,446
|
130,469
|
Total
|
292,460
|
39,878
|
2,784
|
2,313
|
44,975
|
8,413
|
345,848
|
|
|
|
|
|
|
|
|
Impairment allowance
|
|
|
|
|
|
|
|
Home loans
|
34
|
54
|
15
|
14
|
83
|
360
|
477
|
Credit cards, unsecured loans and other retail lending
|
516
|
1,768
|
158
|
219
|
2,145
|
2,380
|
5,041
|
Corporate loans
|
142
|
296
|
19
|
8
|
323
|
546
|
1,011
|
Total
|
692
|
2,118
|
192
|
241
|
2,551
|
3,286
|
6,529
|
|
|
|
|
|
|
|
|
Net exposure
|
|
|
|
|
|
|
|
Home loans
|
130,525
|
16,586
|
1,621
|
778
|
18,985
|
2,033
|
151,543
|
Credit cards, unsecured loans and other retail lending
|
47,075
|
9,437
|
371
|
241
|
10,049
|
1,194
|
58,318
|
Corporate loans
|
114,168
|
11,737
|
600
|
1,053
|
13,390
|
1,900
|
129,458
|
Total
|
291,768
|
37,760
|
2,592
|
2,072
|
42,424
|
5,127
|
339,319
|
|
|
|
|
|
|
|
|
Coverage ratio
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
Home loans
|
-
|
0.3
|
0.9
|
1.8
|
0.4
|
15.0
|
0.3
|
Credit cards, unsecured loans and other retail lending
|
1.1
|
15.8
|
29.9
|
47.6
|
17.6
|
66.6
|
8.0
|
Corporate loans
|
0.1
|
2.5
|
3.1
|
0.8
|
2.4
|
22.3
|
0.8
|
Total
|
0.2
|
5.3
|
6.9
|
10.4
|
5.7
|
39.1
|
1.9
|
|
|
|
|
|
|
|
|
As at 31.12.18
|
|
|
|
|
|
|
|
Gross exposure
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Home loans
|
130,066
|
15,672
|
1,672
|
862
|
18,206
|
2,476
|
150,748
|
Credit cards, unsecured loans and other retail lending
|
45,785
|
11,262
|
530
|
437
|
12,229
|
3,760
|
61,774
|
Corporate loans
|
105,375
|
12,177
|
360
|
475
|
13,012
|
2,267
|
120,654
|
Total
|
281,226
|
39,111
|
2,562
|
1,774
|
43,447
|
8,503
|
333,176
|
|
|
|
|
|
|
|
|
Impairment allowance
|
|
|
|
|
|
|
|
Home loans
|
31
|
56
|
13
|
13
|
82
|
351
|
464
|
Credit cards, unsecured loans and other retail lending
|
528
|
1,895
|
169
|
240
|
2,304
|
2,511
|
5,343
|
Corporate loans
|
129
|
300
|
16
|
13
|
329
|
505
|
963
|
Total
|
688
|
2,251
|
198
|
266
|
2,715
|
3,367
|
6,770
|
|
|
|
|
|
|
|
|
Net exposure
|
|
|
|
|
|
|
|
Home loans
|
130,035
|
15,616
|
1,659
|
849
|
18,124
|
2,125
|
150,284
|
Credit cards, unsecured loans and other retail lending
|
45,257
|
9,367
|
361
|
197
|
9,925
|
1,249
|
56,431
|
Corporate loans
|
105,246
|
11,877
|
344
|
462
|
12,683
|
1,762
|
119,691
|
Total
|
280,538
|
36,860
|
2,364
|
1,508
|
40,732
|
5,136
|
326,406
|
|
|
|
|
|
|
|
|
Coverage ratio
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
Home loans
|
-
|
0.4
|
0.8
|
1.5
|
0.5
|
14.2
|
0.3
|
Credit cards, unsecured loans and other retail lending
|
1.2
|
16.8
|
31.9
|
54.9
|
18.8
|
66.8
|
8.6
|
Corporate loans
|
0.1
|
2.5
|
4.4
|
2.7
|
2.5
|
22.3
|
0.8
|
Total
|
0.2
|
5.8
|
7.7
|
15.0
|
6.2
|
39.6
|
2.0
|
Movement in gross exposures and impairment allowance including
provisions for loan commitments and financial
guarantees
The
following tables present a reconciliation of the opening to the
closing balance of the exposure and impairment allowance. An
explanation of the terms 12-month Expected Credit Losses (ECL),
lifetime ECL and credit-impaired is included in the Barclays PLC
Annual Report 2018 on page 273.
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
Gross exposure for loans and advances at amortised
cost
|
£m
|
£m
|
£m
|
£m
|
As at 1 January 2019
|
281,226
|
43,447
|
8,503
|
333,176
|
Transfers from Stage 1
|
(13,760)
|
13,256
|
504
|
-
|
Transfers from Stage 2
|
9,943
|
(11,468)
|
1,525
|
-
|
Transfers from Stage 3
|
271
|
267
|
(538)
|
-
|
Business activity in the year
|
51,037
|
1,543
|
169
|
52,749
|
Net drawdowns and repayments
|
(8,564)
|
867
|
91
|
(7,606)
|
Final repayments
|
(27,693)
|
(2,937)
|
(605)
|
(31,235)
|
Disposals
|
-
|
-
|
(285)
|
(285)
|
Write-offs
1
|
-
|
-
|
(951)
|
(951)
|
As at 30 June 2019
|
292,460
|
44,975
|
8,413
|
345,848
|
|
|
|
|
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
Impairment allowance on loans and advances at amortised
cost
|
£m
|
£m
|
£m
|
£m
|
As at 1 January 2019
|
688
|
2,715
|
3,367
|
6,770
|
Transfers from Stage 1
|
(91)
|
82
|
9
|
-
|
Transfers from Stage 2
|
507
|
(834)
|
327
|
-
|
Transfers from Stage 3
|
23
|
17
|
(40)
|
-
|
Business activity in the year
|
122
|
77
|
27
|
226
|
Net re-measurement and movement due to exposure and risk parameter
changes
|
(520)
|
563
|
841
|
884
|
Final repayments
|
(37)
|
(69)
|
(74)
|
(180)
|
Disposals
|
-
|
-
|
(220)
|
(220)
|
Write-offs
1
|
-
|
-
|
(951)
|
(951)
|
As at 30 June 2019
2
|
692
|
2,551
|
3,286
|
6,529
|
|
|
|
|
|
Reconciliation of ECL movement to impairment charge/(release) for
the period
|
|
|
|
£m
|
ECL movement excluding assets derecognised due to disposals and
write-offs
|
|
|
|
930
|
Post write-off recoveries
1
|
|
|
|
(73)
|
Exchange and other adjustments
|
|
|
|
35
|
Impairment charge on loan commitments and financial
guarantees
|
|
|
|
30
|
Impairment charge on other financial assets
2
|
|
|
|
6
|
Income statement charge/(release) for the period
|
|
|
|
928
|
1
|
In H119, gross write-offs amounted to
£
951m (H118:
£
949m) and post write-off
recoveries amounted to £73m (H118: £
68m). Net write-offs represent gross write-offs
less post write-off recoveries and amounted to
£
878m (H118:
£
881m).
|
2
|
Other financial assets subject to
impairment not included in the table above include cash collateral
and settlement balances, financial assets at fair value through
other comprehensive income and other assets. These have a total
gross exposure of £
178.7bn
(December 2018: £
129.9bn)
and impairment allowance of £
22m (December 2018: £
12m). This comprises £
14m ECL (December 2018: £
10m) on £
178.2bn stage 1 assets (December 2018:
£
129.3bn),
£
3m (December 2018:
£
2m) on
£
0.5bn stage 2 fair value
through other comprehensive income assets (December 2018:
£
0.6bn) and
£
5m (December 2018:
£
nil) on
£
5m stage 3 other assets
(December 2018: £
nil).
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
Gross exposure for loan commitments and financial
guarantees
|
£m
|
£m
|
£m
|
£m
|
As at 1 January 2019
|
309,989
|
22,126
|
684
|
332,799
|
Net transfers between stages
|
(1,406)
|
969
|
437
|
-
|
Business activity in the year
|
44,908
|
1,579
|
12
|
46,499
|
Net drawdowns and repayments
|
(3,536)
|
229
|
(342)
|
(3,649)
|
Final repayments
|
(28,927)
|
(4,242)
|
(288)
|
(33,457)
|
As at 30 June 2019
|
321,028
|
20,661
|
503
|
342,192
|
|
|
|
|
|
Impairment allowance on loan commitments and financial
guarantees
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
£m
|
£m
|
£m
|
£m
|
As at 1 January 2019
|
99
|
150
|
22
|
271
|
Net transfers between stages
|
8
|
(6)
|
(2)
|
-
|
Business activity in the year
|
26
|
25
|
7
|
58
|
Net re-measurement and movement due to exposure and risk parameter
changes
|
(14)
|
18
|
6
|
10
|
Final repayments
|
(15)
|
(26)
|
(1)
|
(42)
|
As at 30 June 2019
|
104
|
161
|
32
|
297
|
Measurement uncertainty
The
measurement of ECL involves complexity and judgement, including
estimation of probabilities of default (PD), loss given default
(LGD), a range of unbiased future economic scenarios, estimation of
expected lives, estimation of exposures at default (EAD) and
assessing significant increases in credit risk.
Barclays
Group uses a five-scenario model to calculate ECL. An external
consensus forecast is assembled from key sources, including HM
Treasury, Bloomberg and the Urban Land Institute, which forms the
baseline scenario. In addition, two adverse scenarios (Downside 1
and Downside 2) and two favourable scenarios (Upside 1 and Upside
2) are derived, with associated probability weightings. The adverse
scenarios are calibrated to a similar severity to internal stress
tests, whilst also considering IFRS 9 specific sensitivities and
non-linearity. Downside 2 is benchmarked to the Bank of
England’s annual cyclical scenarios and to the most severe
scenario from Moody’s inventory, but is not designed to be
the same. The favourable scenarios are calibrated to be symmetric
to the adverse scenarios, subject to a ceiling calibrated to
relevant recent favourable benchmark scenarios. The scenarios
include eight economic variables, (GDP, unemployment, House Price
Index (HPI) and base rates in both the UK and US markets), and
expanded variables using statistical models based on historical
correlations. All five scenarios converge to a steady state after
eight years.
Scenario weights
The
methodology for estimating probability weights for each of the
scenarios involves a comparison of the distribution of key historic
UK and US macroeconomic variables against the forecast paths of the
five scenarios. The methodology works such that the baseline
(reflecting current consensus outlook) has the highest weight and
the weights of adverse and favourable scenarios depend on the
deviation from the baseline; the further from the baseline, the
smaller the weight. The probability weights of the scenarios as of
30 June 2019 are shown below. A single set of five scenarios is
used across all portfolios and all five weights are normalised to
equate to 100%. The same scenarios and weights that are used in the
estimation of expected credit losses are also used for Barclays
internal planning purposes. The impacts across the portfolios are
different because of the sensitivities of each of the portfolios to
specific macroeconomic variables, for example, mortgages are highly
sensitive to house prices and base rates, credit cards and
unsecured consumer loans are highly sensitive to
unemployment.
The
tables below show the macroeconomic variables for each scenario and
the respective scenario weights. Note that in order to provide
additional transparency, 5-year average data tables and UK/US base
rate metrics have been included.
Scenario probability weighting
|
|
|
|
|
|
|
Upside 2
|
Upside 1
|
Baseline
|
Downside 1
|
Downside 2
|
As at 30.06.19 and 31.12.18
|
%
|
%
|
%
|
%
|
%
|
Scenario probability weighting
|
9
|
24
|
41
|
23
|
3
|
Macroeconomic variables (specific
bases)
1
|
|
|
|
|
|
|
Upside 2
|
Upside 1
|
Baseline
|
Downside 1
|
Downside 2
|
As at 30.06.19
|
%
|
%
|
%
|
%
|
%
|
UK GDP
2
|
4.5
|
3.1
|
1.7
|
0.3
|
(4.1)
|
UK unemployment
3
|
3.4
|
3.9
|
4.3
|
5.7
|
8.8
|
UK HPI
4
|
46.4
|
32.6
|
3.2
|
(0.5)
|
(32.1)
|
UK bank rate
3
|
0.8
|
0.8
|
1.0
|
2.5
|
4.0
|
US GDP
2
|
4.8
|
3.7
|
2.1
|
0.4
|
(3.3)
|
US unemployment
3
|
3.0
|
3.4
|
3.7
|
5.2
|
8.4
|
US HPI
4
|
36.9
|
30.2
|
4.1
|
-
|
(17.4)
|
US federal funds rate
3
|
2.3
|
2.3
|
2.7
|
3.0
|
3.5
|
|
|
|
|
|
|
As at 31.12.18
|
|
|
|
|
|
UK GDP
2
|
4.5
|
3.1
|
1.7
|
0.3
|
(4.1)
|
UK unemployment
3
|
3.4
|
3.9
|
4.3
|
5.7
|
8.8
|
UK HPI
4
|
46.4
|
32.6
|
3.2
|
(0.5)
|
(32.1)
|
UK bank rate
3
|
0.8
|
0.8
|
1.0
|
2.5
|
4.0
|
US GDP
2
|
4.8
|
3.7
|
2.1
|
0.4
|
(3.3)
|
US unemployment
3
|
3.0
|
3.4
|
3.7
|
5.2
|
8.4
|
US HPI
4
|
36.9
|
30.2
|
4.1
|
-
|
(17.4)
|
US federal funds rate
3
|
2.3
|
2.3
|
2.7
|
3.0
|
3.5
|
|
|
|
|
|
|
As at 30.06.18
|
|
|
|
|
|
UK GDP
2
|
4.4
|
3.1
|
1.8
|
(0.3)
|
(4.8)
|
UK unemployment
3
|
3.0
|
3.7
|
4.8
|
6.0
|
9.0
|
UK HPI
4
|
45.3
|
28.3
|
2.8
|
(3.1)
|
(33.4)
|
UK bank rate
3
|
0.5
|
0.5
|
0.9
|
2.5
|
4.0
|
US GDP
2
|
4.6
|
3.4
|
2.0
|
(0.3)
|
(4.7)
|
US unemployment
3
|
2.4
|
3.1
|
4.2
|
5.6
|
9.0
|
US HPI
4
|
35.8
|
28.5
|
4.2
|
(1.8)
|
(19.5)
|
US federal funds rate
3
|
1.5
|
1.5
|
1.8
|
2.9
|
3.5
|
1
|
UK GDP = Real GDP growth seasonally adjusted; UK unemployment = UK
unemployment rate 16-year+; UK HPI = Halifax All Houses, All Buyers
Index; US GDP = Real GDP growth seasonally adjusted; US
unemployment = US civilian unemployment rate 16-year+; US HPI =
FHFA house price index.
|
2
|
Highest annual growth in Upside scenarios; 5-year average in
Baseline; lowest annual growth in Downside scenarios.
|
3
|
Lowest yearly average in Upside scenarios; 5-year average in
Baseline; highest yearly average in Downside
scenarios.
|
4
|
Cumulative growth (trough to peak) in Upside scenarios; 5-year
average in Baseline; cumulative fall (peak-to-trough) in Downside
scenarios.
|
Macroeconomic variables (5-year
averages)
1
|
|
|
|
|
|
|
Upside 2
|
Upside 1
|
Baseline
|
Downside 1
|
Downside 2
|
As at 30.06.19
|
%
|
%
|
%
|
%
|
%
|
UK GDP
|
3.4
|
2.6
|
1.7
|
0.9
|
(0.6)
|
UK unemployment
|
3.7
|
4.0
|
4.3
|
5.1
|
7.9
|
UK HPI
|
7.9
|
5.8
|
3.2
|
0.9
|
(6.4)
|
UK bank rate
|
0.8
|
0.8
|
1.0
|
2.3
|
3.7
|
US GDP
|
3.7
|
3.0
|
2.1
|
1.1
|
(0.5)
|
US unemployment
|
3.1
|
3.5
|
3.7
|
4.7
|
7.4
|
US HPI
|
6.5
|
5.4
|
4.1
|
2.4
|
(2.6)
|
US federal funds rate
|
2.3
|
2.3
|
2.7
|
3.0
|
3.4
|
|
|
|
|
|
|
As at 31.12.18
|
|
|
|
|
|
UK GDP
|
3.4
|
2.6
|
1.7
|
0.9
|
(0.6)
|
UK unemployment
|
3.7
|
4.0
|
4.3
|
5.1
|
7.9
|
UK HPI
|
7.9
|
5.8
|
3.2
|
0.9
|
(6.4)
|
UK bank rate
|
0.8
|
0.8
|
1.0
|
2.3
|
3.7
|
US GDP
|
3.7
|
3.0
|
2.1
|
1.1
|
(0.5)
|
US unemployment
|
3.1
|
3.5
|
3.7
|
4.7
|
7.4
|
US HPI
|
6.5
|
5.4
|
4.1
|
2.4
|
(2.6)
|
US federal funds rate
|
2.3
|
2.3
|
2.7
|
3.0
|
3.4
|
|
|
|
|
|
|
As at 30.06.18
|
|
|
|
|
|
UK GDP
|
3.3
|
2.5
|
1.8
|
0.8
|
(0.8)
|
UK unemployment
|
3.5
|
4.0
|
4.8
|
5.5
|
8.2
|
UK HPI
|
7.8
|
5.1
|
2.8
|
0.2
|
(7.0)
|
UK bank rate
|
0.5
|
0.6
|
0.9
|
2.1
|
3.6
|
US GDP
|
3.5
|
2.7
|
2.0
|
0.9
|
(0.8)
|
US unemployment
|
2.9
|
3.4
|
4.2
|
5.1
|
7.8
|
US HPI
|
6.3
|
5.2
|
4.2
|
2.0
|
(3.1)
|
US federal funds rate
|
1.5
|
1.6
|
1.8
|
2.7
|
3.3
|
1
|
UK GDP = Real GDP growth seasonally adjusted; UK unemployment = UK
unemployment rate 16-year+; UK HPI = Halifax All Houses, All Buyers
Index; US GDP = Real GDP growth seasonally adjusted; US
unemployment = US civilian unemployment rate 16-year+; US HPI =
FHFA house price index.
|
IFRS 9
models must assess ECL across a range of future economic
conditions. These economic scenarios are generated via an
independent model and ultimately set by the Senior Scenario Review
Committee (SSRC). Economic scenarios are regenerated at a minimum
annually (to align with Barclays Group’s medium-term planning
exercise) but also if external consensus regarding the UK or US
economy materially changes. The SSRC monitors consensus and within
the period there have been no sufficiently material changes to
external consensus regarding the UK or US economy, and as such
there have been no changes to the macroeconomic variable paths
within each modelled scenario during 2019. There is however
continued anticipated economic uncertainty in the UK and as a
result the impairment adjustment of £150m, based broadly on
the output of the sensitivity analysis at 31 December 2018,
continues to be included in the impairment balance at 30 June 2019.
The output of the sensitivity analysis as at 31 December 2018
remains valid given the scenarios are unchanged and the portfolios
are comparable. Please refer to pages 161 to 163 of the Barclays
PLC Annual Report 2018 for details.
Analysis of specific portfolios and asset types
Secured home loans
The UK
home loan portfolio primarily comprises first lien mortgages and
accounts for 91% (December 2018: 91%) of the Barclays Group’s
total home loans balance.
Home loans principal portfolios
|
|
|
Barclays UK
|
|
|
As at
30.06.19
|
As at
31.12.18
|
Gross loans and advances (£m)
|
|
|
138,272
|
136,517
|
90 day arrears rate, excluding recovery book (%)
|
|
|
0.1
|
0.1
|
Annualised gross charge-off rate - 180 days past due
(%)
|
|
|
0.2
|
0.3
|
Recovery book proportion of outstanding balances (%)
|
|
|
0.2
|
0.2
|
Recovery book impairment coverage ratio (%)
|
|
|
7.3
|
7.1
|
|
|
|
|
|
Average marked to market LTV
|
|
|
|
|
Balance weighted (%)
|
|
|
50.1
|
48.9
|
Valuation weighted (%)
|
|
|
36.6
|
35.8
|
|
|
|
|
|
New lending
|
|
|
Half year ended 30.06.19
|
Half year ended 30.06.18
|
New home loan completions (£m)
|
|
|
11,097
|
11,496
|
New home loans proportion > 85% LTV (%)
|
|
|
14.3
|
8.9
|
Average LTV on new home loans: balance weighted (%)
|
|
|
67.1
|
64.4
|
Average LTV on new home loans: valuation weighted (%)
|
|
|
58.9
|
56.3
|
Home loans principal portfolios -
distribution of balances by LTV
1
|
|
|
|
|
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
|
Distribution of balances
|
Distribution of impairment allowance
|
Coverage ratio
|
Distribution of balances
|
Distribution of impairment allowance
|
Coverage ratio
|
Barclays UK
|
%
|
%
|
%
|
%
|
%
|
%
|
<=75%
|
88.9
|
42.2
|
-
|
90.6
|
50.9
|
-
|
>75% and <=90%
|
9.7
|
25.1
|
0.1
|
8.6
|
22.1
|
0.1
|
>90% and <=100%
|
1.3
|
9.8
|
0.4
|
0.7
|
7.7
|
0.5
|
>100%
|
0.1
|
22.9
|
9.5
|
0.1
|
19.3
|
10.8
|
1
|
Portfolio mark to market based on the most updated valuation
including recovery book balances. Updated valuations reflect the
application of the latest HPI available as at 30 June
2019.
|
Total
gross UK home loans balances increased by £1.8bn, mainly
driven by Buy to Let (BTL) lending. BTL home loans accounted
for 13% (December 2018: 12%) of total balances, and the BTL average
balance weighted LTV increased to 55.6% (December 2018:
55.4%).
Residential
interest-only home loans comprised 24% (December 2018: 26%) of
total balances. The average balance weighted LTV on these loans
increased to 38.9% (December 2018: 38.8%). The 90-day arrears rate
excluding recovery book remained stable at 0.3% (December 2018:
0.3%).
The
value of home loan completions was lower than H118, for both
Residential and BTL. The reduction in Residential was driven
by a significantly lower value of business written in January, with
Q2 higher year on year. The proportion of new home loan
completions associated with BTL remained stable year on year at
17%.
The
average marked to market LTV measures and the proportion of
balances at >75% LTV increased due to a higher average LTV for
new business flow than for the total book. New lending LTVs
remained within planned levels throughout H119.
Head Office:
Italian home loans and advances at amortised
cost reduced to £7.5bn (December 2018: £7.9bn) and
continue to run-off since new completions ceased in 2016. The
portfolio is secured on Residential property with an average
balance weighted marked to market LTV of 63.7% (December 2018:
61.8%). 90-day arrears and gross charge-off rates remained stable
at 1.5% (December 2018: 1.4%) and 0.8% (December 2018: 0.8%)
respectively.
Credit cards, unsecured loans and other retail lending
The
principal portfolios listed below accounted for 84% (December 2018:
87%) of the Barclays Group’s total credit cards, unsecured
loans and other retail lending.
Principal portfolios
|
Gross exposure
|
30 day arrears rate, excluding recovery book
|
90 day arrears rate, excluding recovery book
|
Annualised gross write-off rate
|
Annualised net write-off rate
|
As at 30.06.19
|
£m
|
%
|
%
|
%
|
%
|
Barclays UK
|
|
|
|
|
|
UK cards
|
16,925
|
1.8
|
0.9
|
2.0
|
1.9
|
UK personal loans
|
6,334
|
2.2
|
1.1
|
3.3
|
3.0
|
Barclays International
|
|
|
|
|
|
US cards
|
22,172
|
2.4
|
1.3
|
4.5
|
4.4
|
Barclays Partner Finance
|
4,277
|
0.9
|
0.3
|
1.5
|
1.5
|
Germany consumer lending
|
3,758
|
1.7
|
0.7
|
1.0
|
0.2
|
|
|
|
|
|
|
As at 31.12.18
|
|
|
|
|
|
Barclays UK
|
|
|
|
|
|
UK cards
|
17,285
|
1.8
|
0.9
|
1.9
|
1.5
|
UK personal loans
|
6,335
|
2.3
|
1.1
|
1.9
|
1.5
|
Barclays International
|
|
|
|
|
|
US cards
|
22,178
|
2.7
|
1.4
|
3.6
|
3.4
|
Barclays Partner Finance
|
4,216
|
1.1
|
0.4
|
1.7
|
1.7
|
Germany consumer lending
|
3,545
|
1.9
|
0.8
|
1.2
|
0.5
|
UK cards:
30 and 90 day arrears rates remained stable. The
annualised gross write-off rate increased marginally, whilst the
net write-off rate increased from 1.5% to 1.9% as a result of
increased debt sale activity.
UK personal loans:
30 and 90 day arrears rates reduced
slightly. The annualised gross and net write-off rates increased,
reflecting the resolution of write-off processing issues observed
in 2018. Underlying write off rates remained stable.
US cards
: 30 and 90 day arrears rates reduced due to the
impact of seasonality. The increase in write-off rates reflected an
increase in the rate of assets flowing into the recovery book in
H218 which led to a higher level of assets being written off in the
current period.
Barclays Partner Finance
: The reduction in arrears rates
reflected improved quality of new business and better arrears
management. Write-off rates were broadly stable.
Germany consumer lending
:
Arrears rates improved due to
better quality of new business and good collections performance.
The reduced write-off rates were primarily driven by the cards
portfolio due to the timing of debt sale write-offs.
Market Risk
Analysis of management value at risk (VaR)
The
table below shows the total management VaR on a diversified basis
by risk factor. Total management VaR includes all trading positions
in CIB and Treasury and it is calculated with a one-day holding
period.
Limits
are applied against each risk factor VaR as well as total
management VaR, which are then cascaded further by risk managers to
each business.
Management VaR (95%) by asset
class
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Half year ended 30.06.19
|
|
Half year ended 31.12.18
|
|
Half year ended 30.06.18
|
|
Average
|
High
2
|
Low
2
|
|
Average
|
High
2
|
Low
2
|
|
Average
|
High
2
|
Low
2
|
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
Credit risk
|
11
|
14
|
8
|
|
10
|
13
|
8
|
|
11
|
16
|
8
|
Interest rate risk
|
5
|
9
|
3
|
|
8
|
14
|
3
|
|
9
|
19
|
4
|
Equity risk
|
9
|
16
|
5
|
|
7
|
14
|
4
|
|
7
|
12
|
4
|
Basis risk
|
8
|
9
|
6
|
|
7
|
8
|
6
|
|
5
|
8
|
4
|
Spread risk
|
4
|
5
|
3
|
|
6
|
9
|
3
|
|
5
|
9
|
3
|
Foreign exchange risk
|
3
|
5
|
2
|
|
3
|
6
|
2
|
|
3
|
7
|
2
|
Commodity risk
|
1
|
1
|
-
|
|
1
|
1
|
-
|
|
1
|
2
|
-
|
Inflation risk
|
2
|
3
|
2
|
|
3
|
3
|
2
|
|
3
|
4
|
2
|
Diversification effect
2
|
(22)
|
n/a
|
n/a
|
|
(24)
|
n/a
|
n/a
|
|
(24)
|
n/a
|
n/a
|
Total management VaR
|
21
|
26
|
17
|
|
21
|
27
|
18
|
|
20
|
26
|
15
|
1
|
Excludes Barclays Africa Group Limited from 23 July
2018.
|
2
|
Diversification effects recognise that forecast losses from
different assets or businesses are unlikely to occur concurrently,
hence the expected aggregate loss is lower than the sum of the
expected losses from each area. Historical correlations between
losses are taken into account in making these assessments. The high
and low VaR figures reported for each category did not necessarily
occur on the same day as the high and low VaR reported as a whole.
Consequently, a diversification effect balance for the high and low
VaR figures would not be meaningful and is therefore omitted from
the above table.
|
Treasury and Capital Risk
The
Barclays Group has a comprehensive Key Risk Control Framework for
managing its liquidity risk. The Liquidity Framework meets the PRA
standards and is designed to maintain liquidity resources that are
sufficient in amount and quality, and a funding profile that is
appropriate to meet the Barclays Group’s liquidity risk
appetite (LRA). The Liquidity Framework is delivered via a
combination of policy formation, review and governance, analysis,
stress testing, limit setting and monitoring.
Liquidity risk stress testing
As at
30 June 2019, the Barclays Group held eligible liquid assets in
excess of 100% of net stress outflows to its internal and external
regulatory requirements. The short-term stress scenarios comprise a
30-day Barclays specific stress event, a 90-day market-wide stress
event and a 30-day combined scenario consisting of both a Barclays
specific and market-wide stress.
Liquidity coverage ratio
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
|
£bn
|
£bn
|
Eligible liquidity buffer
|
232
|
219
|
Net stress outflows
|
(149)
|
(129)
|
Surplus
|
83
|
90
|
|
|
|
Liquidity coverage ratio
|
156%
|
169%
|
The
Barclays Group plans to maintain its surplus to the internal and
regulatory stress requirements at an efficient level, while
considering risks to market funding conditions and its liquidity
position. The continuous reassessment of these risks may lead to
execution of appropriate actions to resize the liquidity
pool.
Composition of the Group liquidity pool
|
|
|
|
|
|
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
|
|
Liquidity pool
|
Liquidity pool of which CRR LCR
eligible
3
|
Liquidity pool
|
|
|
Cash
|
Level 1
|
Level 2A
|
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Cash and deposits with central
banks
1
|
|
160
|
156
|
-
|
-
|
181
|
|
|
|
|
|
|
|
Government bonds
2
|
|
|
|
|
|
|
AAA to AA-
|
|
47
|
-
|
41
|
3
|
27
|
A+ to A-
|
|
5
|
-
|
5
|
-
|
1
|
BBB+ to BBB-
|
|
4
|
-
|
4
|
-
|
3
|
Other LCR ineligible government bonds
|
|
-
|
-
|
-
|
-
|
1
|
Total government bonds
|
|
56
|
-
|
50
|
3
|
32
|
|
|
|
|
|
|
|
Other
|
|
|
|
|
|
|
Government guaranteed issuers, PSEs and GSEs
|
|
8
|
-
|
8
|
-
|
6
|
International organisations and MDBs
|
|
7
|
-
|
7
|
-
|
5
|
Covered bonds
|
|
6
|
-
|
5
|
1
|
3
|
Other
|
|
1
|
-
|
1
|
-
|
-
|
Total other
|
|
22
|
-
|
21
|
1
|
14
|
|
|
|
|
|
|
|
Total as at 30 June 2019
|
|
238
|
156
|
71
|
4
|
227
|
Total as at 31 December 2018
|
|
227
|
176
|
40
|
1
|
|
1
|
Of which over 99% (December 2018: over 99%) was placed with the
Bank of England, US Federal Reserve, European Central Bank, Bank of
Japan and Swiss National Bank.
|
2
|
Of which over 77% (December 2018: over 71%) comprised UK, US,
French, German, Swiss and Dutch securities.
|
3
|
The LCR eligible liquidity pool is adjusted for trapped liquidity
and other regulatory deductions. It also incorporates other CRR (as
amended by CRR II) qualifying assets that are not eligible under
Barclays’ internal risk appetite.
|
The
Barclays Group liquidity pool was £238bn as at 30 June 2019
(December 2018: £227bn). During H119, the month-end liquidity
pool ranged from £227bn to £251bn (H218: £207bn to
£243bn), and the month-end average balance was £237bn
(H218: £225bn). The liquidity pool is held unencumbered and is
not used to support payment or clearing requirements. Such
requirements are treated as part of our regular business funding.
The liquidity pool is intended to offset stress outflows, and
comprises the above cash and unencumbered assets.
As at
30 June 2019, 68% (December 2018: 70%) of the liquidity pool was
located in Barclays Bank PLC, 20% (December 2018: 20%) in Barclays
Bank UK PLC and 5% (December 2018: 2%) in Barclays Bank Ireland
PLC. The residual portion of the liquidity pool is held outside of
these entities, predominantly in US subsidiaries, to meet
entity-specific stress outflows and local regulatory requirements.
To the extent the use of this residual portion of the liquidity
pool is restricted due to local regulatory requirements, it is
assumed to be unavailable to the rest of the Barclays Group in
calculating the LCR.
Deposit funding
|
|
|
|
|
|
|
As at 30.06.19
|
|
As at 31.12.18
|
|
Loans and advances at amortised cost
|
Deposits at amortised cost
|
Loan: deposit ratio
1
|
|
Loan: deposit ratio
1
|
Funding of loans and advances
|
£bn
|
£bn
|
%
|
|
%
|
Barclays UK
|
194
|
201
|
97%
|
|
96%
|
Barclays International
|
135
|
212
|
64%
|
|
65%
|
Head Office
|
10
|
-
|
-
|
|
-
|
Barclays Group
|
339
|
414
|
82%
|
|
83%
|
1
|
The loan: deposit ratio is calculated as loans and advances at
amortised cost divided by deposits at amortised cost.
|
Funding structure and funding relationships
The
basis for liquidity risk management is a funding structure that
reduces the probability of a liquidity stress leading to an
inability to meet funding obligations as they fall due. The
Barclays Group’s overall funding strategy is to develop a
diversified funding base (geographically, by type and by
counterparty) and maintain access to a variety of alternative
funding sources, to provide protection against unexpected
fluctuations, while minimising the cost of funding.
Within
this, the Barclays Group aims to align the sources and uses of
funding. As such, loans and advances are largely funded by
deposits, with the surplus used to fund liquidity requirements. The
majority of reverse repurchase agreements are matched by repurchase
agreements. Derivative liabilities and assets are largely matched.
A substantial proportion of balance sheet derivative positions
qualify for counterparty netting and the remaining portions are
largely offset once netted against cash collateral received and
paid. Wholesale debt and equity is used to fund residual
assets.
These
funding relationships as at 30 June 2019 are summarised
below:
|
As at 30.06.19
|
As at 31.12.18
|
|
|
As at 30.06.19
|
As at 31.12.18
|
Assets
|
£bn
|
£bn
|
|
Liabilities and equity
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
339
|
327
|
|
Deposits at amortised cost
|
414
|
395
|
Group liquidity pool
|
238
|
227
|
|
<1 Year wholesale funding
|
53
|
47
|
|
|
|
|
>1 Year wholesale funding
|
113
|
107
|
Reverse repurchase agreements, trading portfolio assets, cash
collateral and settlement balances
|
356
|
303
|
|
Repurchase agreements, trading portfolio liabilities, cash
collateral and settlement balances
|
304
|
262
|
Derivative financial instruments
|
244
|
223
|
|
Derivative financial instruments
|
243
|
220
|
Other assets
1
|
56
|
53
|
|
Other liabilities
|
37
|
38
|
|
|
|
|
Equity
|
69
|
64
|
Total assets
|
1,233
|
1,133
|
|
Total liabilities and equity
|
1,233
|
1,133
|
1
|
Other assets include fair value assets that are not part of reverse
repurchase agreements or trading portfolio assets, and other asset
categories.
|
Composition of wholesale funding
Wholesale
funding outstanding (excluding repurchase agreements) was
£165.6bn (December 2018: £154bn). In 2019, Barclays Group
issued £7.1bn of MREL eligible instruments from Barclays PLC
(the Parent company) in a range of different tenors and
currencies.
Barclays
Bank PLC continued to issue in the shorter-term markets and
Barclays Bank UK PLC issued in the shorter-term and secured
markets, helping to maintain their stable and diversified funding
bases.
Wholesale
funding of £52.8bn (December 2018: £46.7bn) matures in
less than one year, representing 32% (December 2018: 30%) of total
wholesale funding outstanding. This includes £20.4bn (December
2018: £19.1bn) related to term funding
2
. Although not a
requirement, the liquidity pool exceeded wholesale funding maturing
in less than one year by £185bn (December 2018:
£180bn).
Maturity profile of wholesale
funding
1,2
|
|
|
|
|
|
|
|
|
<1
|
1-3
|
3-6
|
6-12
|
<1
|
1-2
|
2-3
|
3-4
|
4-5
|
>5
|
|
|
month
|
months
|
months
|
months
|
year
|
years
|
years
|
years
|
years
|
years
|
Total
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Barclays PLC (the Parent company)
|
|
|
|
|
|
|
|
|
|
|
|
Senior unsecured (public benchmark)
|
-
|
-
|
1.6
|
0.8
|
2.4
|
2.9
|
3.4
|
4.0
|
8.5
|
13.8
|
35.0
|
Senior unsecured (privately placed)
|
-
|
-
|
-
|
-
|
-
|
0.1
|
0.1
|
0.1
|
0.2
|
0.5
|
1.0
|
Subordinated liabilities
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
8.1
|
8.1
|
Barclays Bank PLC (including
|
|
|
|
|
|
|
|
|
|
|
|
subsidiaries)
|
|
|
|
|
|
|
|
|
|
|
|
Certificates of deposit and commercial paper
|
3.7
|
5.6
|
9.6
|
4.8
|
23.7
|
1.0
|
0.9
|
0.4
|
0.1
|
-
|
26.1
|
Asset backed commercial paper
|
2.8
|
3.2
|
1.0
|
-
|
7.0
|
-
|
-
|
-
|
-
|
-
|
7.0
|
Senior unsecured (public benchmark)
|
-
|
1.2
|
-
|
0.6
|
1.8
|
3.0
|
0.2
|
-
|
1.2
|
0.4
|
6.6
|
Senior unsecured (privately placed)
3
|
0.8
|
2.8
|
1.5
|
5.1
|
10.2
|
8.5
|
4.7
|
4.1
|
3.8
|
21.0
|
52.3
|
Asset backed securities
|
0.4
|
0.6
|
-
|
1.0
|
2.0
|
0.1
|
0.5
|
0.7
|
0.9
|
1.7
|
5.9
|
Subordinated liabilities
|
0.2
|
-
|
0.1
|
0.1
|
0.4
|
5.6
|
1.3
|
2.4
|
-
|
1.0
|
10.7
|
Other
|
0.1
|
-
|
-
|
-
|
0.1
|
-
|
-
|
-
|
0.2
|
0.6
|
0.9
|
Barclays Bank UK PLC (including
|
|
|
|
|
|
|
|
|
|
|
|
subsidiaries)
|
|
|
|
|
|
|
|
|
|
|
|
Certificates of deposit and commercial paper
|
0.3
|
0.7
|
0.4
|
0.2
|
1.6
|
-
|
-
|
-
|
-
|
-
|
1.6
|
Covered bonds
|
-
|
-
|
1.8
|
1.0
|
2.8
|
1.0
|
2.3
|
1.8
|
-
|
1.2
|
9.1
|
Asset backed securities
|
0.8
|
-
|
-
|
-
|
0.8
|
0.5
|
-
|
-
|
-
|
-
|
1.3
|
Total as at 30 June 2019
|
9.1
|
14.1
|
16.0
|
13.6
|
52.8
|
22.7
|
13.4
|
13.5
|
14.9
|
48.3
|
165.6
|
Of which secured
|
4.0
|
3.8
|
2.8
|
2.0
|
12.6
|
1.6
|
2.8
|
2.5
|
0.9
|
2.9
|
23.3
|
Of which unsecured
|
5.1
|
10.3
|
13.2
|
11.6
|
40.2
|
21.1
|
10.6
|
11.0
|
14.0
|
45.4
|
142.3
|
|
|
|
|
|
|
|
|
|
|
|
|
Total as at 31 December 2018
|
2.5
|
15.9
|
8.2
|
20.1
|
46.7
|
16.7
|
16.8
|
10.4
|
13.2
|
50.2
|
154.0
|
Of which secured
|
2.0
|
3.7
|
1.1
|
3.6
|
10.4
|
2.7
|
1.2
|
2.6
|
1.9
|
3.7
|
22.5
|
Of which unsecured
|
0.5
|
12.2
|
7.1
|
16.5
|
36.3
|
14.0
|
15.6
|
7.8
|
11.3
|
46.5
|
131.5
|
1
|
The composition of wholesale funds comprises the balance sheet
reported financial liabilities at fair value, debt securities in
issue and subordinated liabilities. It does not include
participation in the central bank facilities reported within
repurchase agreements and other similar secured
borrowing.
|
2
|
Term funding comprises public benchmark and privately placed senior
unsecured notes, covered bonds, asset-backed securities and
subordinated debt where the original maturity of the instrument is
more than 1 year.
|
3
|
Includes structured notes of £43.9bn, of which £7.3bn
matures within one year.
|
Credit ratings
In
addition to monitoring and managing key metrics related to the
financial strength of the Barclays Group, Barclays also solicits
independent credit ratings from Standard & Poor’s Global
(S&P), Moody’s, Fitch, and Rating and Investment
Information (R&I). These ratings assess the creditworthiness of
the Barclays Group, its subsidiaries and its branches, and are
based on reviews of a broad range of business and financial
attributes including capital strength, profitability, funding,
liquidity, asset quality, strategy and governance.
Barclays Bank PLC
|
Standard & Poor's
|
Moody's
|
Fitch
|
Long-term
|
A / Stable
|
A2 / Positive
|
A+ / RWN
1
|
Short-term
|
A-1
|
P-1
|
F1
|
|
|
|
|
Barclays Bank UK PLC
|
|
|
|
Long-term
|
A / Stable
|
A1 / Stable
|
A+ / RWN
1
|
Short-term
|
A-1
|
P-1
|
F1
|
|
|
|
|
Barclays PLC
|
|
|
|
Long-term
|
BBB / Stable
|
Baa3 / Positive
|
A / RWN
1
|
Short-term
|
A-2
|
P-3
|
F1
|
In
March 2019, Fitch placed the outlooks of all entities on rating
watch negative alongside UK peers to reflect their expectation that
they would revise the outlooks to negative under a disruptive no
deal Brexit scenario. In June 2019, Fitch affirmed all ratings for
Barclays PLC, Barclays Bank PLC and Barclays Bank UK
PLC.
In May
2019, Moody’s revised the outlooks of the senior unsecured
debt ratings of Barclays PLC and Barclays Bank PLC from stable to
positive, due to their expectation that operating performance and
profitability prospects will improve. Barclays Bank UK PLC’s
ratings outlooks remained unchanged.
In June
2019, S&P affirmed all ratings for Barclays PLC, Barclays Bank
PLC and Barclays Bank UK PLC.
Barclays
also solicits issuer ratings from R&I and the ratings of A- for
Barclays PLC and A for Barclays Bank PLC were affirmed in July 2018
with stable outlooks.
Capital
Barclays’
CET1 regulatory requirement is 11.7% comprising a 4.5% Pillar 1
minimum, a 2.5% Capital Conservation Buffer (CCB), a 1.5% Global
Systemically Important Institution (G-SII) buffer, a 2.6% Pillar 2A
requirement and a 0.5% Countercyclical Capital Buffer
(CCyB).
The
Barclays CCyB is based on the buffer rate applicable for each
jurisdiction in which Barclays have exposures. On 28 November 2018,
the Financial Policy Committee set the CCyB rate for UK exposures
at 1%. The buffer rates set by other national authorities for our
non-UK exposures are not currently material. Overall, this results
in a 0.5% CCyB for Barclays for H119.
Barclays’
Pillar 2A requirement as per the PRA’s Individual Capital
Requirement for 2019 is 4.7%, of which at least 56.25% needs to be
met in CET1 form, equating to approximately 2.6% of RWAs. Certain
elements of the Pillar 2A requirement are a fixed quantum whilst
others are a proportion of RWAs and are based on a point in time
assessment. The Pillar 2A requirement is subject to at least annual
review.
On 27
June 2019, as part of the EU Risk Reduction Measure package, the
CRR II entered into force amending CRR. As an amending
regulation, the existing provisions of CRR apply unless they are
amended by CRR II. The amendments largely take effect and are
phased in from 28 June 2021 with a number of exceptions which are
implemented with immediate effect.
These
exceptions primarily relate to the minimum requirement for own
funds and eligible liabilities (MREL). Amendments within this
section include changes to qualifying criteria for CET1, AT1 and
Tier 2 instruments, the inclusion of additional holdings eligible
for deduction, an amendment to the treatment of deferred tax assets
and the introduction of requirements for MREL. Grandfathering and
transitional provisions relating to MREL have also been
introduced.
Certain
aspects of CRR II are dependent on final technical standards to be
issued by the European Banking Authority (EBA) and adopted by the
European Commission as well as UK implementation of the
rules. The disclosures in the following section reflect
Barclays’ interpretation of the current rules and
guidance.
Capital ratios
1,2,3
|
As at
|
As at
|
As at
|
30.06.19
|
31.03.19
|
31.12.18
|
CET1
|
13.4%
|
13.0%
|
13.2%
|
Tier 1 (T1)
|
17.4%
|
17.1%
|
17.0%
|
Total regulatory capital
|
21.4%
|
20.8%
|
20.7%
|
|
|
|
|
Capital resources
|
£bn
|
£bn
|
£bn
|
Total equity excluding non-controlling interests per the balance
sheet
|
67.6
|
64.7
|
62.6
|
Less: other equity instruments (recognised as AT1
capital)
|
(12.1)
|
(11.1)
|
(9.6)
|
Adjustment to retained earnings for foreseeable
dividends
|
(0.8)
|
(1.0)
|
(0.7)
|
|
|
|
|
Other regulatory adjustments and deductions
|
|
|
|
Additional value adjustments (PVA)
|
(1.8)
|
(1.7)
|
(1.7)
|
Goodwill and intangible assets
|
(8.0)
|
(7.9)
|
(8.0)
|
Deferred tax assets that rely on future profitability excluding
temporary differences
|
(0.4)
|
(0.4)
|
(0.5)
|
Fair value reserves related to gains or losses on cash flow
hedges
|
(1.2)
|
(1.0)
|
(0.7)
|
Gains or losses on liabilities at fair value resulting from own
credit
|
(0.1)
|
(0.2)
|
(0.1)
|
Defined benefit pension fund assets
|
(1.4)
|
(0.9)
|
(1.3)
|
Direct and indirect holdings by an institution of own CET1
instruments
|
(0.1)
|
(0.1)
|
(0.1)
|
Adjustment under IFRS 9 transitional arrangements
|
1.2
|
1.2
|
1.3
|
CET1 capital
|
42.9
|
41.4
|
41.1
|
|
|
|
|
AT1 capital
|
|
|
|
Capital instruments and related share premium accounts
|
12.1
|
11.1
|
9.6
|
Qualifying AT1 capital (including minority interests) issued by
subsidiaries
|
0.7
|
2.3
|
2.4
|
Other regulatory adjustments and deductions
|
(0.1)
|
(0.1)
|
(0.1)
|
AT1 capital
|
12.7
|
13.3
|
11.9
|
|
|
|
|
T1 capital
|
55.6
|
54.7
|
53.0
|
|
|
|
|
T2 capital
|
|
|
|
Capital instruments and related share premium accounts
|
8.0
|
6.5
|
6.6
|
Qualifying T2 capital (including minority interests) issued by
subsidiaries
|
5.0
|
5.5
|
5.3
|
Credit risk adjustments (excess of impairment over expected
losses)
|
-
|
0.1
|
-
|
Other regulatory adjustments and deductions
|
(0.3)
|
(0.3)
|
(0.3)
|
Total regulatory capital
|
68.3
|
66.6
|
64.6
|
|
|
|
|
Total RWAs
|
319.1
|
319.7
|
311.9
|
1
|
CET1, T1 and T2 capital, and RWAs are calculated applying the
transitional arrangements of the CRR as amended by CRR II
applicable as at the reporting date. This includes IFRS 9
transitional arrangements and the grandfathering of CRR and CRR II
non-compliant capital instruments.
|
2
|
The fully loaded CET1 ratio, as is relevant for assessing against
the conversion trigger in Barclays PLC AT1 securities, was 13.1%,
with £41.7bn of CET1 capital and £319.0bn of RWAs
calculated without applying the transitional arrangements of the
CRR as amended by CRR II applicable as at the reporting
date.
|
3
|
The Barclays PLC CET1 ratio, as is relevant for assessing against
the conversion trigger in Barclays Bank PLC T2 Contingent Capital
Notes, was 13.4%. For this calculation CET1 capital and RWAs are
calculated applying the transitional arrangements under the CRR,
including the IFRS 9 transitional arrangements. The benefit of the
Financial Services Authority (FSA) October 2012 interpretation of
the transitional provisions, relating to the implementation of CRD
IV, expired in December 2017.
|
Movement in CET1 capital
|
Three months
|
Six months
|
ended
|
ended
|
30.06.19
|
30.06.19
|
£bn
|
£bn
|
Opening CET1 capital
|
41.4
|
41.1
|
|
|
|
Profit for the period attributable to equity holders
|
1.2
|
2.4
|
Dividends paid and foreseen
|
(0.7)
|
(1.2)
|
Increase in retained regulatory capital generated from
earnings
|
0.5
|
1.3
|
|
|
|
Net impact of share schemes
|
0.3
|
-
|
Fair value through other comprehensive income reserve
|
0.4
|
0.5
|
Currency translation reserve
|
0.6
|
0.2
|
Increase in other qualifying reserves
|
1.2
|
0.7
|
|
|
|
Pension remeasurements within reserves
|
0.3
|
(0.1)
|
Defined benefit pension fund asset deduction
|
(0.5)
|
(0.1)
|
Net impact of pensions
|
(0.2)
|
(0.2)
|
|
|
|
Additional value adjustments (PVA)
|
(0.1)
|
-
|
Goodwill and intangible assets
|
(0.1)
|
-
|
Deferred tax assets that rely on future profitability excluding
those arising from temporary differences
|
0.1
|
0.1
|
Adjustment under IFRS 9 transitional arrangements
|
-
|
(0.1)
|
Decrease in regulatory capital due to adjustments and
deductions
|
(0.1)
|
-
|
|
|
|
Closing CET1 capital
|
42.9
|
42.9
|
|
|
|
CET1
capital increased £1.8bn to £42.9bn (December 2018:
£41.1bn).
£2.4bn
of organic capital generated from profits was partially offset by
£1.2bn of regulatory dividends paid and foreseen including
£0.4bn of AT1 coupons paid. Other movements in the period
were:
|
●
|
A
£0.5bn increase in the fair value through other comprehensive
income reserve mainly driven by gains from an increase in fair
value of bonds due to decreasing bond yields
|
|
●
|
A
£0.2bn increase in the currency translation reserve mainly
driven by the appreciation of period end USD against
GBP
|
|
●
|
A
£0.2bn decrease as a result of movements relating to pensions,
largely due to deficit contribution payments of £0.25bn in
April 2019
|
|
●
|
A
£0.1bn decrease in the IFRS 9 transitional add back primarily
due to the change in the phasing of transitional relief from 95% in
2018 to 85% in 2019
|
Risk weighted assets (RWAs) by risk type and business
|
|
Credit risk
|
|
Counterparty credit risk
|
|
Market risk
|
|
Operational risk
|
Total RWAs
|
|
Std
|
IRB
|
|
Std
|
IRB
|
Settlement risk
|
CVA
|
|
Std
|
IMA
|
|
|
|
As at 30.06.19
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Barclays UK
|
3.8
|
60.2
|
|
0.3
|
-
|
-
|
-
|
|
0.1
|
-
|
|
11.8
|
76.2
|
Corporate
and Investment Bank
|
24.6
|
68.2
|
|
12.4
|
16.4
|
0.2
|
3.4
|
|
15.4
|
13.7
|
|
21.6
|
175.9
|
Consumer,
Cards and Payments
|
29.3
|
2.1
|
|
0.1
|
-
|
-
|
-
|
|
-
|
0.1
|
|
7.3
|
38.9
|
Barclays International
|
53.9
|
70.3
|
|
12.5
|
16.4
|
0.2
|
3.4
|
|
15.4
|
13.8
|
|
28.9
|
214.8
|
Head Office
|
5.7
|
6.4
|
|
-
|
-
|
-
|
-
|
|
-
|
-
|
|
16.0
|
28.1
|
Barclays Group
|
63.4
|
136.9
|
|
12.8
|
16.4
|
0.2
|
3.4
|
|
15.5
|
13.8
|
|
56.7
|
319.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at 31.03.19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barclays UK
|
3.8
|
60.7
|
|
0.2
|
-
|
-
|
-
|
|
0.1
|
-
|
|
11.8
|
76.6
|
Corporate
and Investment Bank
|
26.8
|
66.3
|
|
10.2
|
15.9
|
0.1
|
4.1
|
|
16.5
|
15.1
|
|
21.6
|
176.6
|
Consumer,
Cards and Payments
|
29.4
|
2.2
|
|
0.1
|
-
|
-
|
-
|
|
-
|
0.5
|
|
7.3
|
39.5
|
Barclays International
|
56.2
|
68.5
|
|
10.3
|
15.9
|
0.1
|
4.1
|
|
16.5
|
15.6
|
|
28.9
|
216.1
|
Head Office
|
5.2
|
5.8
|
|
-
|
-
|
-
|
-
|
|
-
|
-
|
|
16.0
|
27.0
|
Barclays Group
|
65.2
|
135.0
|
|
10.5
|
15.9
|
0.1
|
4.1
|
|
16.6
|
15.6
|
|
56.7
|
319.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at 31.12.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barclays UK
|
3.3
|
59.7
|
|
0.2
|
-
|
-
|
0.1
|
|
0.1
|
-
|
|
11.8
|
75.2
|
Corporate
and Investment Bank
|
26.1
|
64.8
|
|
9.8
|
14.9
|
0.2
|
3.3
|
|
13.9
|
16.2
|
|
21.7
|
170.9
|
Consumer,
Cards and Payments
|
29.5
|
2.2
|
|
0.1
|
0.1
|
-
|
-
|
|
-
|
0.6
|
|
7.3
|
39.8
|
Barclays International
|
55.6
|
67.0
|
|
9.9
|
15.0
|
0.2
|
3.3
|
|
13.9
|
16.8
|
|
29.0
|
210.7
|
Head Office
|
4.3
|
5.8
|
|
-
|
-
|
-
|
-
|
|
-
|
-
|
|
15.9
|
26.0
|
Barclays Group
|
63.2
|
132.5
|
|
10.1
|
15.0
|
0.2
|
3.4
|
|
14.0
|
16.8
|
|
56.7
|
311.9
|
Movement analysis of RWAs
|
|
Credit risk
|
Counterparty credit risk
|
Market risk
|
Operational risk
|
Total RWAs
|
As at 30.06.19
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Opening RWAs
|
195.6
|
28.8
|
30.8
|
56.7
|
311.9
|
Book size
|
4.3
|
4.0
|
(1.2)
|
-
|
7.1
|
Acquisitions and disposals
|
(0.2)
|
-
|
-
|
-
|
(0.2)
|
Book quality
|
(0.1)
|
-
|
-
|
-
|
(0.1)
|
Model updates
|
-
|
-
|
-
|
-
|
-
|
Methodology and policy
|
0.2
|
-
|
(0.3)
|
-
|
(0.1)
|
Foreign exchange movements
1
|
0.5
|
-
|
-
|
-
|
0.5
|
Closing RWAs
|
200.3
|
32.8
|
29.3
|
56.7
|
319.1
|
1
|
Foreign exchange movements does not include foreign exchange for
counterparty credit risk or market risk.
|
RWAs
increased £7.2bn to £319.1bn; this was primarily driven
by increased CIB activity compared to year-end.
Leverage ratio and exposures
Barclays
is subject to a leverage ratio requirement of 4.0% as at 30 June
2019. This comprises the 3.25% minimum requirement, a G-SII
additional leverage ratio buffer (G-SII ALRB) of 0.53% and a
countercyclical leverage ratio buffer (CCLB) of 0.2%. Although the
leverage ratio is expressed in terms of T1 capital, 75% of the
minimum requirement, equating to 2.4375%, needs to be met with CET1
capital. In addition, the G-SII ALRB and CCLB must be covered
solely with CET1 capital. The CET1 capital held against the 0.53%
G-SII ALRB was £6.0bn and against the 0.2% CCLB was
£2.3bn.
Barclays
is required to disclose an average UK leverage ratio which is based
on capital on the last day of each month in the quarter and an
exposure measure for each day in the quarter. Barclays is also
required to disclose a UK leverage ratio based on capital and
exposure on the last day of the quarter. Both approaches exclude
qualifying claims on central banks from the leverage
exposures.
Leverage ratios
1,2
|
As at
30.06.19
|
As at
31.03.19
|
As at
31.12.18
|
£bn
|
£bn
|
£bn
|
Average UK leverage ratio
|
4.7%
|
4.6%
|
4.5%
|
Average T1 capital
3
|
53.8
|
51.2
|
50.5
|
Average UK leverage exposure
|
1,135
|
1,106
|
1,110
|
|
|
|
|
UK leverage ratio
|
5.1%
|
4.9%
|
5.1%
|
|
|
|
|
CET1 capital
|
42.9
|
41.4
|
41.1
|
AT1 capital
|
12.0
|
11.0
|
9.5
|
T1 capital
3
|
54.9
|
52.4
|
50.6
|
|
|
|
|
UK leverage exposure
|
1,079
|
1,065
|
999
|
|
|
|
|
UK leverage exposure
|
|
|
|
Accounting assets
|
|
|
|
Derivative financial instruments
|
244
|
218
|
223
|
Derivative cash collateral
|
59
|
53
|
48
|
Securities financing transactions (SFTs)
|
131
|
135
|
121
|
Loans and advances and other assets
|
799
|
788
|
741
|
Total IFRS assets
|
1,233
|
1,194
|
1,133
|
|
|
|
|
Regulatory consolidation adjustments
|
(1)
|
(2)
|
(2)
|
|
|
|
|
Derivatives adjustments
|
|
|
|
Derivatives netting
|
(223)
|
(198)
|
(202)
|
Adjustments to cash collateral
|
(51)
|
(43)
|
(42)
|
Net written credit protection
|
15
|
16
|
19
|
Potential future exposure (PFE) on derivatives
|
127
|
125
|
123
|
Total derivatives adjustments
|
(132)
|
(100)
|
(102)
|
|
|
|
|
SFTs adjustments
|
17
|
17
|
17
|
|
|
|
|
Regulatory deductions and other adjustments
|
(12)
|
(11)
|
(11)
|
|
|
|
|
Weighted off-balance sheet commitments
|
110
|
108
|
108
|
|
|
|
|
Qualifying central bank claims
|
(136)
|
(141)
|
(144)
|
|
|
|
|
UK leverage exposure
2
|
1,079
|
1,065
|
999
|
1
|
The fully loaded UK leverage ratio was 5.0%, with £53.7bn of
T1 capital and £1,078bn of leverage exposure calculated
without applying the transitional
arrangements of the CRR as amended by CRR II applicable as at the
reporting date.
|
2
|
Capital and leverage measures are calculated applying the
transitional arrangements of the CRR as amended by CRR II
applicable as at the reporting date.
|
3
|
T1 capital is calculated in line with the PRA
Handbook.
|
The
average UK leverage ratio increased to 4.7% (December 2018: 4.5%).
T1 capital increased £3.3bn to £53.8bn, which included
the accretion of CET1 capital and the issuance of AT1 securities,
partially offset by an increase in exposure of £25bn to
£1,135bn primarily driven by securities financing transactions
(SFTs) trading activity.
The UK
leverage ratio remained stable at 5.1% (December 2018: 5.1%). The
T1 capital increased £4.3bn to £54.9bn, which included
the accretion of CET1 capital and the issuance of AT1 securities.
The UK leverage exposure increased £80bn to £1,079bn
which included a seasonal increase in settlement balances and
trading portfolio assets.
The
average UK leverage ratio is 40bps less than the UK leverage ratio,
which reflects the capacity that Barclays has to deploy highly
liquid assets intra-quarter in addition to client activity
reductions at quarter ends, including settlement
balances.
Barclays
also discloses a CRR leverage ratio
1
within its
additional regulatory disclosures prepared in accordance with EBA
guidelines on disclosure under Part Eight of the CRR (see Barclays
PLC Pillar 3 Report H1 2019, due to be published on 23 August 2019
and which will be available at
home.barclays/investor-relations/reports-and-events/latest-financial-results
).
1
|
CRR leverage ratio as amended by CRR II applicable as at the
reporting date.
|
Minimum requirement for own funds and eligible liabilities
(MREL)
The CRR
II requirements relating to own funds and eligible liabilities came
into effect from 27 June 2019. Barclays has calculated eligible
liabilities reflecting our interpretation of the current rules and
guidance. Certain aspects of CRR II are dependent on final
technical standards to be issued by the EBA and adopted by the
European Commission as well as UK implementation of the
rules.
Barclays
is required to meet the higher of: (i) the MREL set by the Bank of
England; or (ii) the requirements in CRR II. MREL is subject to
phased implementation and will be fully implemented by 1 January
2022, at which time Barclays indicative MREL is expected to be two
times the sum of its Pillar 1 and Pillar 2A requirements, as set by
the Bank of England. In addition, CET1 capital cannot be counted
towards both MREL and the capital buffers, meaning that the buffers
will effectively be applied above both the Pillar 1 and Pillar 2A
requirements relating to own funds and eligible liabilities. The
Bank of England will review the MREL calibration by the end of
2020, including assessing the proposal for Pillar 2A
recapitalisation, which may drive a different 1 January 2022 MREL
than currently proposed.
Barclays’
indicative MREL is currently expected to be 29.9% of RWAs from 1
January 2022 comprising:
|
●
|
Loss
absorption and recapitalisation amounts consisting of two times the
8% Pillar 1 and 4.7% Pillar 2A requirement
|
|
●
|
Capital
buffers including a 1.5% G-SII buffer, 2.5% CCB and 0.5%
CCyB
|
Own funds and eligible liabilities
ratios
1
|
As at
30.06.19
|
As at
31.03.19
3
|
As at
31.12.18
3
|
CET1 capital
|
13.4%
|
13.0%
|
13.2%
|
AT1 capital instruments and related share premium
accounts
2
|
3.8%
|
3.4%
|
3.1%
|
T2 capital instruments and related share premium
accounts
2
|
2.4%
|
2.0%
|
2.1%
|
Eligible liabilities
|
10.6%
|
9.4%
|
9.7%
|
Total Barclays PLC (the Parent company) own funds and eligible
liabilities
|
30.2%
|
27.7%
|
28.1%
|
Qualifying AT1 capital (including minority interests) issued by
subsidiaries
|
0.2%
|
0.7%
|
0.7%
|
Qualifying T2 capital (including minority interests) issued by
subsidiaries
|
1.6%
|
1.7%
|
1.6%
|
Total own funds and eligible liabilities, including eligible
Barclays Bank PLC instruments
|
32.0%
|
30.2%
|
30.5%
|
|
|
|
|
Own funds and eligible
liabilities
1
|
£bn
|
£bn
3
|
£bn
3
|
CET1 capital
|
42.9
|
41.4
|
41.1
|
AT1 capital instruments and related share premium
accounts
2
|
12.0
|
11.0
|
9.6
|
T2 capital instruments and related share premium
accounts
2
|
7.8
|
6.3
|
6.6
|
Eligible liabilities
|
33.7
|
29.9
|
30.4
|
Total Barclays PLC (the Parent company) own funds and eligible
liabilities
|
96.4
|
88.7
|
87.7
|
Qualifying AT1 capital (including minority interests) issued by
subsidiaries
|
0.7
|
2.3
|
2.3
|
Qualifying T2 capital (including minority interests) issued by
subsidiaries
|
5.0
|
5.5
|
5.1
|
Total own funds and eligible liabilities, including eligible
Barclays Bank PLC instruments
|
102.0
|
96.5
|
95.1
|
|
|
|
|
Total RWAs
1
|
319.1
|
319.7
|
311.9
|
1
|
CET1, T1 and T2 capital, and RWAs are calculated applying the
transitional arrangements of the CRR as amended by CRR II
applicable as at the reporting date. This includes IFRS 9
transitional arrangements and the grandfathering of CRR and CRR II
non-compliant capital instruments.
|
2
|
Includes other AT1 capital regulatory adjustments and deductions of
£0.1bn (included in AT1 issued by subsidiaries in December
2018: £0.1bn), and other T2 credit risk adjustments and
deductions of £0.2bn (included in T2 issued by subsidiaries in
December 2018: £0.3bn).
|
3
|
The comparatives are based on the Bank of England's statement of
policy on MREL.
|
Statement of Directors’ Responsibilities
Each of
the Directors (the names of whom are set out below) confirm that to
the best of their knowledge, the condensed consolidated interim
financial statements set out on pages 49 to 54 have been prepared
in accordance with International Accounting Standard 34,
‘Interim Financial Reporting’, as adopted by the
European Union (EU), and that the interim management report herein
includes a fair review of the information required by Disclosure
and Transparency Rules 4.2.7R and 4.2.8R namely:
●
|
an indication of important events that have occurred during the six
months ended 30 June 2019 and their impact on the condensed
consolidated interim financial statements, and a description of the
principal risks and uncertainties for the remaining six months of
the financial year
|
●
|
any related party transactions in the six months ended 30 June 2019
that have materially affected the financial position or performance
of Barclays during that period and any changes in the related party
transactions described in the last Annual Report that could have a
material effect on the financial position or performance of
Barclays in the six months ended 30 June 2019.
|
Signed
on 31 July 2019 on behalf of the Board by
James E Staley
|
Tushar Morzaria
|
Group
Chief Executive
|
Group
Finance Director
|
Barclays
PLC Board of Directors:
Chairman
Nigel Higgins
|
Executive Directors
James E Staley
Tushar Morzaria
|
Non-executive Directors
Mike Ashley
Tim Breedon CBE
Sir Ian Cheshire
Mary Anne Citrino
Mary Francis CBE
Crawford Gillies
Matthew Lester
Diane Schueneman
|
Independent Review Report to Barclays PLC
Conclusion
We have
been engaged by the company to review the condensed set of
financial statements in the Interim Results Announcement for the
six months ended 30 June 2019 which comprises:
|
●
|
The
condensed consolidated income statement and condensed consolidated
statement of comprehensive income for the period then
ended;
|
|
●
|
the
condensed consolidated balance sheet as at 30 June
2019;
|
|
●
|
the
condensed consolidated statement of changes in equity for the
period then ended;
|
|
●
|
the
condensed consolidated cash flow statement for the period then
ended; and
|
|
●
|
the
related explanatory notes
|
Based
on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the
Interim Results Announcement for the six months ended 30 June 2019
is not prepared, in all material respects, in accordance with IAS
34
Interim Financial
Reporting
as adopted by the EU and the Disclosure Guidance
and Transparency Rules (“the DTR”) of the UK’s
Financial Conduct Authority (“the UK
FCA”).
Scope of review
We
conducted our review in accordance with International Standard on
Review Engagements (UK and Ireland) 2410
Review of Interim Financial Information
Performed by the Independent Auditor of the Entity
issued by
the Auditing Practices Board for use in the UK. A review of interim
financial information consists of making enquiries, primarily of
persons responsible for financial and accounting matters, and
applying analytical and other review procedures. We read the other
information contained in the Interim Results Announcement and
consider whether it contains any apparent misstatements or material
inconsistencies with the information in the condensed set of
financial statements.
A
review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK) and
consequently does not enable us to obtain assurance that we would
become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit
opinion.
The impact of uncertainties due to the UK exiting the European
Union on our review
Uncertainties
related to the effects of Brexit are relevant to understanding our
review of the condensed financial statements. Brexit is one of the
most significant economic events for the UK, and at the date of
this report its effects are subject to unprecedented levels of
uncertainty of outcomes, with the full range of possible effects
unknown. An interim review cannot be expected to predict the
unknowable factors or all possible future implications for a
company and this is particularly the case in relation to
Brexit.
Directors’ responsibilities
The
Interim Results Announcement is the responsibility of, and has been
approved by, the directors. The directors are responsible for
preparing the Interim Results Announcement in accordance with the
DTR of the UK FCA.
As
disclosed in Note 1
Basis of
preparation
, the annual financial statements of the Barclays
Group are prepared in accordance with International Financial
Reporting Standards as adopted by the EU. The directors are
responsible for preparing the condensed set of financial statements
included in the Interim Results Announcement in accordance with IAS
34 as adopted by the EU.
Our responsibility
Our
responsibility is to express to the company a conclusion on the
condensed set of financial statements in the Interim Results
Announcement based on our review.
The purpose of our review work and to whom we owe our
responsibilities
This
report is made solely to the company in accordance with the terms
of our engagement to assist the company in meeting the requirements
of the DTR of the UK FCA. Our review has been undertaken so that we
might state to the company those matters we are required to state
to it in this report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility
to anyone other than the company for our review work, for this
report, or for the conclusions we have reached.
Michelle Hinchliffe
for and on behalf of KPMG LLP
Chartered Accountants
15
Canada Square
London,
E14 5GL
31 July
2019
Condensed Consolidated Financial Statements
Condensed consolidated income statement (unaudited)
|
|
|
Half year ended
|
Half year ended
|
|
|
30.06.19
|
30.06.18
|
|
Notes
1
|
£m
|
£m
|
Net interest income
|
|
4,618
|
4,378
|
Net fee and commission income
|
3
|
3,334
|
3,489
|
Net trading income
|
|
2,124
|
2,480
|
Net investment income
|
|
662
|
512
|
Other income
|
|
52
|
75
|
Total income
|
|
10,790
|
10,934
|
Credit impairment charges and other provisions
|
|
(928)
|
(571)
|
Net operating income
|
|
9,862
|
10,363
|
|
|
|
|
Staff costs
|
4
|
(4,264)
|
(4,277)
|
Infrastructure, administration and general expenses
|
5
|
(2,494)
|
(2,397)
|
Litigation and conduct
|
|
(114)
|
(2,042)
|
Operating expenses
|
|
(6,872)
|
(8,716)
|
|
|
|
|
Profit on disposal of undertakings and share of results of
associates and joint ventures
|
|
24
|
12
|
Profit before tax
|
|
3,014
|
1,659
|
Tax charge
2
|
6
|
(545)
|
(644)
|
Profit after tax
|
|
2,469
|
1,015
|
|
|
|
|
Attributable to:
|
|
|
|
Equity holders of the parent
2
|
|
2,072
|
561
|
Other equity instrument holders
|
|
363
|
346
|
Total equity holders of the parent
|
|
2,435
|
907
|
Non-controlling interests
|
7
|
34
|
108
|
Profit after tax
|
|
2,469
|
1,015
|
|
|
|
|
Earnings per share
|
|
p
|
p
|
Basic earnings per ordinary share
|
8
|
12.1
|
3.3
|
Diluted earnings per ordinary share
|
8
|
11.9
|
3.2
|
1
|
For notes to the Financial Statements see pages 55 to
83.
|
2
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously
recorded in retained earnings.
Comparatives have been restated, reducing the tax charge for H118
by £93m. This change does not impact earnings per share or
return on average tangible
shareholders’ equity.
Further detail can be found in Note 1, Basis of preparation on
pages 55 to 56.
|
Condensed consolidated statement of comprehensive income
(unaudited)
|
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
|
30.06.19
|
30.06.18
|
|
Notes
1
|
£m
|
£m
|
Profit after tax
|
|
2,469
|
1,015
|
|
|
|
|
Other comprehensive income/(loss) that
may be recycled to profit or loss:
2
|
|
|
Currency translation reserve
|
17
|
177
|
338
|
Fair value through other comprehensive income reserve
|
17
|
380
|
(189)
|
Cash flow hedging reserve
|
17
|
528
|
(509)
|
Other
|
17
|
-
|
11
|
Other comprehensive income/(loss) that may be recycled to profit or
loss
|
|
1,085
|
(349)
|
|
|
|
|
Other comprehensive (loss)/income not
recycled to profit or loss:
2
|
|
|
Retirement benefit remeasurements
|
14
|
(140)
|
(54)
|
Fair value through other comprehensive income reserve
|
17
|
125
|
(267)
|
Own credit
|
17
|
44
|
(73)
|
Other comprehensive income/(loss) not recycled to profit or
loss
|
|
29
|
(394)
|
|
|
|
|
Other comprehensive income/(loss) for the period
|
|
1,114
|
(743)
|
|
|
|
|
Total comprehensive income for the period
|
|
3,583
|
272
|
|
|
|
|
Attributable to:
|
|
|
|
Equity holders of the parent
|
|
3,549
|
163
|
Non-controlling interests
|
|
34
|
109
|
Total comprehensive income for the period
|
|
3,583
|
272
|
1
|
For notes to the Financial Statements see pages 55 to
83.
|
2
|
Reported net of tax.
|
Condensed consolidated balance sheet (unaudited)
|
|
|
As at
|
As at
|
|
|
30.06.19
2
|
31.12.18
|
Assets
|
Notes
1
|
£m
|
£m
|
Cash and balances at central banks
|
|
158,070
|
177,069
|
Cash collateral and settlement balances
|
|
104,625
|
77,222
|
Loans and advances at amortised cost
|
|
339,319
|
326,406
|
Reverse repurchase agreements and other similar secured
lending
|
|
8,990
|
2,308
|
Trading portfolio assets
|
|
120,381
|
104,187
|
Financial assets at fair value through the income
statement
|
|
159,705
|
149,648
|
Derivative financial instruments
|
10
|
244,186
|
222,538
|
Financial assets at fair value through other comprehensive
income
|
|
72,169
|
52,816
|
Investments in associates and joint ventures
|
|
734
|
762
|
Goodwill and intangible assets
|
|
7,993
|
7,973
|
Property, plant and equipment
|
|
4,206
|
2,535
|
Current tax assets
|
6
|
884
|
798
|
Deferred tax assets
|
6
|
3,142
|
3,828
|
Retirement benefit assets
|
14
|
1,875
|
1,768
|
Other assets
|
|
6,543
|
3,425
|
Total assets
|
|
1,232,822
|
1,133,283
|
|
|
|
|
Liabilities
|
|
|
|
Deposits at amortised cost
|
|
413,596
|
394,838
|
Cash collateral and settlement balances
|
|
93,806
|
67,522
|
Repurchase agreements and other similar secured
borrowing
|
|
18,322
|
18,578
|
Debt securities in issue
|
|
90,815
|
82,286
|
Subordinated liabilities
|
12
|
18,803
|
20,559
|
Trading portfolio liabilities
|
|
42,724
|
37,882
|
Financial liabilities designated at fair value
|
|
229,853
|
216,834
|
Derivative financial instruments
|
10
|
243,103
|
219,643
|
Current tax liabilities
|
6
|
616
|
628
|
Deferred tax liabilities
|
6
|
5
|
51
|
Retirement benefit liabilities
|
14
|
323
|
315
|
Other liabilities
|
|
10,279
|
7,716
|
Provisions
|
13
|
1,780
|
2,652
|
Total liabilities
|
|
1,164,025
|
1,069,504
|
|
|
|
|
Equity
|
|
|
|
Called up share capital and share premium
|
15
|
4,494
|
4,311
|
Other reserves
|
17
|
6,403
|
5,153
|
Retained earnings
|
|
44,556
|
43,460
|
Shareholders' equity attributable to ordinary shareholders of the
parent
|
|
55,453
|
52,924
|
Other equity instruments
|
16
|
12,123
|
9,632
|
Total equity excluding non-controlling interests
|
|
67,576
|
62,556
|
Non-controlling interests
|
7
|
1,221
|
1,223
|
Total equity
|
|
68,797
|
63,779
|
|
|
|
|
Total liabilities and equity
|
|
1,232,822
|
1,133,283
|
1
|
For notes to the Financial Statements see pages 55 to
83.
|
2
|
Barclays adopted the accounting standard IFRS 16 on 1 January 2019.
The impact on adoption was an increase in property,
plant and equipment of £1.6bn, an increase in other
liabilities of £1.6bn, with no material impact on retained
earnings.
|
Condensed consolidated statement of changes in equity
(unaudited)
|
|
Called up share capital and share
premium
1
|
Other equity
instruments
1
|
Other reserves
1
|
Retained earnings
|
Total
|
Non-controlling
interests
2
|
Total equity
|
Half year ended 30.06.19
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Balance as at 1 January 2019
|
4,311
|
9,632
|
5,153
|
43,460
|
62,556
|
1,223
|
63,779
|
Profit after tax
|
-
|
363
|
-
|
2,072
|
2,435
|
34
|
2,469
|
Currency translation movements
|
-
|
-
|
177
|
-
|
177
|
-
|
177
|
Fair value through other comprehensive income reserve
|
-
|
-
|
505
|
-
|
505
|
-
|
505
|
Cash flow hedges
|
-
|
-
|
528
|
-
|
528
|
-
|
528
|
Retirement benefit remeasurements
|
-
|
-
|
-
|
(140)
|
(140)
|
-
|
(140)
|
Own credit
|
-
|
-
|
44
|
-
|
44
|
-
|
44
|
Total comprehensive income for the period
|
-
|
363
|
1,254
|
1,932
|
3,549
|
34
|
3,583
|
Issue of new ordinary shares
|
159
|
-
|
-
|
-
|
159
|
-
|
159
|
Issue of shares under employee share schemes
|
24
|
-
|
-
|
241
|
265
|
-
|
265
|
Issue and exchange of other equity instruments
|
-
|
2,504
|
-
|
-
|
2,504
|
|
2,504
|
Other equity instruments coupons paid
|
-
|
(363)
|
-
|
-
|
(363)
|
-
|
(363)
|
Vesting of shares under employee share schemes
|
-
|
-
|
(4)
|
(384)
|
(388)
|
-
|
(388)
|
Dividends paid
|
-
|
-
|
-
|
(684)
|
(684)
|
(34)
|
(718)
|
Other movements
|
-
|
(13)
|
-
|
(9)
|
(22)
|
(2)
|
(24)
|
Balance as at 30 June 2019
|
4,494
|
12,123
|
6,403
|
44,556
|
67,576
|
1,221
|
68,797
|
|
|
|
|
|
|
|
|
Half year ended 31.12.18
|
|
|
|
|
|
|
|
Balance as at 1 July 2018
|
22,144
|
8,938
|
4,532
|
25,441
|
61,055
|
2,113
|
63,168
|
Profit after tax
3
|
-
|
406
|
-
|
1,036
|
1,442
|
118
|
1,560
|
Currency translation movements
|
-
|
-
|
496
|
-
|
496
|
-
|
496
|
Fair value through other comprehensive income reserve
|
-
|
-
|
(30)
|
-
|
(30)
|
-
|
(30)
|
Cash flow hedges
|
-
|
-
|
8
|
-
|
8
|
-
|
8
|
Retirement benefit remeasurements
|
-
|
-
|
-
|
367
|
367
|
-
|
367
|
Own credit
|
-
|
-
|
131
|
-
|
131
|
-
|
131
|
Other
|
-
|
-
|
-
|
20
|
20
|
(1)
|
19
|
Total comprehensive income for the period
|
-
|
406
|
605
|
1,423
|
2,434
|
117
|
2,551
|
Issue of new ordinary shares
|
21
|
-
|
-
|
-
|
21
|
-
|
21
|
Issue of shares under employee share schemes
|
19
|
-
|
-
|
212
|
231
|
-
|
231
|
Capital reorganisation
|
(17,873)
|
-
|
-
|
17,873
|
-
|
-
|
-
|
Issue and exchange of other equity instruments
|
-
|
692
|
-
|
(308)
|
384
|
-
|
384
|
Other equity instruments coupons paid
3
|
-
|
(406)
|
-
|
-
|
(406)
|
-
|
(406)
|
Redemption of preference shares
|
-
|
-
|
-
|
(732)
|
(732)
|
(1,309)
|
(2,041)
|
Debt to equity reclassification
|
-
|
-
|
-
|
-
|
-
|
419
|
419
|
Vesting of shares under employee share schemes
|
-
|
-
|
16
|
(15)
|
1
|
-
|
1
|
Dividends paid
|
-
|
-
|
-
|
(427)
|
(427)
|
(120)
|
(547)
|
Other movements
|
-
|
2
|
-
|
(7)
|
(5)
|
3
|
(2)
|
Balance as at 31 December 2018
|
4,311
|
9,632
|
5,153
|
43,460
|
62,556
|
1,223
|
63,779
|
1
|
Details of share capital, other equity instruments and other
reserves are shown on pages 72 to 74.
|
2
|
Details of non-controlling interests are shown on page
60.
|
3
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement, whereas it was previously
recorded in retained earnings.
This change does not impact earnings per share or return on average
tangible shareholders’ equity. Comparatives have been
restated, reducing the tax charge
for H218 by £110m.
Further detail can be found in Note 1, Basis of preparation on
pages 55 to 56.
|
Condensed consolidated statement of changes in equity
(unaudited)
|
|
Called up share capital and share
premium
1
|
Other equity
instruments
1
|
Other reserves
1
|
Retained earnings
|
Total
|
Non-controlling
interests
2
|
Total equity
|
Half year ended 30.06.18
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Balance as at 31 December 2017
|
22,045
|
8,941
|
5,383
|
27,536
|
63,905
|
2,111
|
66,016
|
Effects of changes in accounting policies
|
-
|
-
|
(136)
|
(2,014)
|
(2,150)
|
-
|
(2,150)
|
Balance as at 1 January 2018
|
22,045
|
8,941
|
5,247
|
25,522
|
61,755
|
2,111
|
63,866
|
Profit after tax
3
|
-
|
346
|
-
|
561
|
907
|
108
|
1,015
|
Currency translation movements
|
-
|
-
|
338
|
-
|
338
|
-
|
338
|
Fair value through other comprehensive income reserve
|
-
|
-
|
(456)
|
-
|
(456)
|
-
|
(456)
|
Cash flow hedges
|
-
|
-
|
(509)
|
-
|
(509)
|
-
|
(509)
|
Retirement benefit remeasurements
|
-
|
-
|
-
|
(54)
|
(54)
|
-
|
(54)
|
Own credit
|
-
|
-
|
(73)
|
-
|
(73)
|
-
|
(73)
|
Other
|
-
|
-
|
-
|
10
|
10
|
1
|
11
|
Total comprehensive income for the period
|
-
|
346
|
(700)
|
517
|
163
|
109
|
272
|
Issue of new ordinary shares
|
67
|
-
|
-
|
-
|
67
|
-
|
67
|
Issue of shares under employee share schemes
|
32
|
-
|
-
|
237
|
269
|
-
|
269
|
Other equity instruments coupons paid
3
|
-
|
(346)
|
-
|
-
|
(346)
|
-
|
(346)
|
Vesting of shares under employee share schemes
|
-
|
-
|
(15)
|
(484)
|
(499)
|
-
|
(499)
|
Dividends paid
|
-
|
-
|
-
|
(341)
|
(341)
|
(106)
|
(447)
|
Other movements
|
-
|
(3)
|
-
|
(10)
|
(13)
|
(1)
|
(14)
|
Balance as at 30 June 2018
|
22,144
|
8,938
|
4,532
|
25,441
|
61,055
|
2,113
|
63,168
|
1
|
Details of share capital, other equity instruments and other
reserves are shown on pages 72 to 74.
|
2
|
Details of non-controlling interests are shown on page
60.
|
3
|
From 2019, due to an IAS 12 update, the tax relief on payments in
relation to AT1 instruments has been recognised in the tax charge
of the income statement,
whereas it was previously recorded in retained earnings.
Comparatives have been restated, reducing the tax charge for H118
by £93m. This change does not
impact earnings per share or return on average tangible
shareholders’ equity. Further detail can be found in Note 1,
Basis of preparation on pages 55 to 56.
|
Condensed consolidated cash flow statement (unaudited)
|
|
|
|
Half year ended
|
Half year ended
|
|
30.06.19
|
30.06.18
|
|
£m
|
£m
|
Profit before tax
|
3,014
|
1,659
|
Adjustment for non-cash items
|
(297)
|
2,716
|
Changes in operating assets and liabilities
|
467
|
(2,799)
|
Corporate income tax paid
|
(260)
|
(172)
|
Net cash from operating activities
|
2,924
|
1,404
|
Net cash from investing activities
|
(17,075)
|
(7,332)
|
Net cash from financing activities
|
(610)
|
(4,300)
|
Effect of exchange rates on cash and cash equivalents
|
652
|
403
|
Net decrease in cash and cash equivalents
|
(14,109)
|
(9,825)
|
Cash and cash equivalents at beginning of the period
|
211,166
|
204,612
|
Cash and cash equivalents at end of the period
|
197,057
|
194,787
|
Financial Statement Notes
These
condensed consolidated interim financial statements for the six
months ended 30 June 2019 have been prepared in accordance with the
DTR of the UK FCA and with IAS 34, Interim Financial Reporting, as
published by the International Accounting Standards Board (IASB)
and adopted by the EU. The condensed consolidated interim financial
statements should be read in conjunction with the annual financial
statements for the year ended 31 December 2018, which have been
prepared in accordance with IFRSs as published by the IASB and as
adopted by the EU.
The
accounting policies and methods of computation used in these
condensed consolidated interim financial statements are the same as
those used in the Barclays PLC Annual Report 2018, except as
disclosed below.
IFRS
16, Leases, which replaced IAS 17, Leases, was applied effective
from 1 January 2019. IFRS 16 applies to all leases with the
exception of licenses of intellectual property, rights held by
licensing agreement within the scope of IAS 38, Intangible Assets,
service concession arrangements, leases of biological assets within
the scope of IAS 41, Agriculture, and leases of minerals, oil,
natural gas and similar non-regenerative resources. IFRS 16
includes an accounting policy choice for a lessee to elect not to
apply IFRS 16 to remaining assets within the scope of IAS 38,
Intangible Assets, which the Barclays Group has decided to
apply.
IFRS 16
does not result in a significant change to lessor accounting;
however, for lessee accounting there is no longer a distinction
between operating and finance leases. Lessees will be required to
recognise both:
|
●
|
A lease
liability, measured at the present value of remaining cash flows on
the lease, and
|
|
●
|
A right
of use (ROU) asset, measured at the amount of the initial
measurement of the lease liability, plus any lease payments made
prior to commencement date, initial direct costs, and estimated
costs of restoring the underlying asset to the condition required
by the lease, less any lease incentives received.
|
Subsequently
the lease liability will increase for the accrual of interest,
resulting in a constant rate of return throughout the life of the
lease, and reduce when payments are made. The right of use asset
will amortise to the income statement over the life of the
lease.
There
is a recognition exemption in IFRS 16 for leases with a term not
exceeding 12 months, which allows the lessee to apply similar
accounting as an operating lease under IAS 17.
The
Barclays Group applied IFRS 16 on a modified retrospective basis
and took advantage of the option not to restate comparative
periods. The Barclays Group applied the following transition
options available under the modified retrospective
approach:
|
●
|
To
calculate the right of use asset equal to the lease liability,
adjusted for prepaid or accrued payments.
|
|
●
|
To rely
on the previous assessment of whether leases are onerous in
accordance with IAS 37 immediately before the date of initial
application as an alternative to performing an impairment review.
The Barclays Group adjusted the carrying amount of the ROU asset at
the date of initial application by the previous carrying amount of
its onerous lease provision.
|
|
●
|
To
apply the recognition exception for leases with a term not
exceeding 12 months.
|
|
●
|
To use
hindsight in determining the lease term if the contract contains
options to extend or terminate the lease.
|
The
impact on adoption was an increase in property, plant and equipment
of £1.6bn, and an increase in other liabilities of
£1.6bn, with no material impact on retained
earnings.
2.
IFRIC
Interpretation 23 – Uncertainty over Income Tax
Treatment
IFRIC
23 clarifies the application of IAS 12 to accounting for income tax
treatments that have yet to be accepted by tax authorities, in
scenarios where it may be unclear how tax law applies to a
particular transaction or circumstance, or whether a taxation
authority will accept an entity’s tax treatment. IFRIC 23 has
been applied from 1 January 2019. There was no significant effect
from the adoption of IFRIC 23 in relation to accounting for
uncertain tax positions.
3.
IAS
12 – Income Taxes – Amendments to IAS 12
The
IASB amended IAS 12 in order to clarify the accounting treatment of
the income tax consequences of dividends. As a result of the
amendment, the tax consequences of all payments on financial
instruments that are classified as equity for accounting purposes,
where those payments are considered to be a distribution of profit,
will be included in, and will reduce, the income statement tax
charge. The amendments of IAS 12 were applied to the income tax
consequences of dividends recognised on or after the beginning of
the earliest comparative period. This resulted in reducing the tax
charge and increasing profit after tax for H119 by £96m and
H118 by £93m. This change does not impact retained earnings or
earnings per share.
4.
IAS
19 – Employee Benefits – Amendments to IAS
19
The
IASB issued amendments to the guidance in IAS 19, Employee
Benefits, in connection with accounting for plan amendments,
curtailments and settlements. The amendments have been applied to
plan amendments, curtailments or settlements occurring on or after
1 January 2019. There was no significant effect from the adoption
of the amendments of IAS 19.
Having
reassessed the Principal Risks, the directors considered it
appropriate to adopt the going concern basis of accounting in
preparing the interim financial information.
The
Credit risk disclosures on pages 24 to 31 form part of these
interim financial statements.
Analysis of results by business
|
|
|
|
|
|
Barclays
UK
|
Barclays
International
|
Head
Office
|
Barclays
Group
|
Half year ended 30.06.19
|
£m
|
£m
|
£m
|
£m
|
Total income
|
3,548
|
7,473
|
(231)
|
10,790
|
Credit impairment charges and other provisions
|
(421)
|
(492)
|
(15)
|
(928)
|
Net operating income/(expenses)
|
3,127
|
6,981
|
(246)
|
9,862
|
Total operating expenses
|
(2,065)
|
(4,671)
|
(136)
|
(6,872)
|
Other net income/(expenses)
1
|
-
|
31
|
(7)
|
24
|
Profit/(loss) before tax
|
1,062
|
2,341
|
(389)
|
3,014
|
|
|
|
|
|
As at 30.06.19
|
£bn
|
£bn
|
£bn
|
£bn
|
Total assets
|
259.0
|
951.4
|
22.4
|
1,232.8
|
|
|
|
|
|
|
Barclays
UK
|
Barclays
International
|
Head
Office
|
Barclays
Group
|
Half year ended 30.06.18
|
£m
|
£m
|
£m
|
£m
|
Total income
|
3,624
|
7,515
|
(205)
|
10,934
|
Credit impairment (charges)/releases and other
provisions
|
(415)
|
(161)
|
5
|
(571)
|
Net operating income/(expenses)
|
3,209
|
7,354
|
(200)
|
10,363
|
Total operating expenses
|
(2,387)
|
(4,668)
|
(1,661)
|
(8,716)
|
Other net income/(expenses)
1
|
4
|
24
|
(16)
|
12
|
Profit/(loss) before tax
|
826
|
2,710
|
(1,877)
|
1,659
|
|
|
|
|
|
As at 31.12.18
|
£bn
|
£bn
|
£bn
|
£bn
|
Total assets
|
249.7
|
862.1
|
21.5
|
1,133.3
|
1
|
Other net income/(expenses) represents the share of post-tax
results of associates and joint ventures, profit (or loss) on
disposal of subsidiaries,
associates and joint ventures and gains on
acquisitions.
|
|
Half year ended
|
Half year ended
|
Split of income by geographic region
1
|
30.06.19
|
30.06.18
|
|
£m
|
£m
|
UK
|
5,365
|
5,527
|
Europe
|
959
|
1,042
|
Americas
|
3,956
|
3,966
|
Africa and Middle East
|
144
|
103
|
Asia
|
366
|
296
|
Total
|
10,790
|
10,934
|
1
|
The geographic region is based on counterparty
location.
|
3.
Net fee and commission income
Fee and
commission income is disaggregated below and includes a total for
fees in scope of IFRS 15, Revenue from Contracts with
Customers:
|
Barclays UK
|
Barclays International
|
Head
Office
|
Total
|
Half year ended 30.06.19
|
£m
|
£m
|
£m
|
£m
|
Fee type
|
|
|
|
|
Transactional
|
523
|
1,353
|
-
|
1,876
|
Advisory
|
88
|
406
|
-
|
494
|
Brokerage and execution
|
101
|
536
|
-
|
637
|
Underwriting and syndication
|
-
|
1,240
|
-
|
1,240
|
Other
|
45
|
131
|
7
|
183
|
Total revenue from contracts with customers
|
757
|
3,666
|
7
|
4,430
|
Other non-contract fee income
|
-
|
54
|
-
|
54
|
Fee and commission income
|
757
|
3,720
|
7
|
4,484
|
Fee and commission expense
|
(187)
|
(957)
|
(6)
|
(1,150)
|
Net fee and commission income
|
570
|
2,763
|
1
|
3,334
|
|
Barclays UK
|
Barclays International
|
Head
Office
|
Total
|
Half year ended 30.06.18
|
£m
|
£m
|
£m
|
£m
|
Fee type
|
|
|
|
|
Transactional
|
530
|
1,257
|
-
|
1,787
|
Advisory
|
99
|
377
|
-
|
476
|
Brokerage and execution
|
52
|
583
|
-
|
635
|
Underwriting and syndication
|
-
|
1,368
|
-
|
1,368
|
Other
|
61
|
125
|
16
|
202
|
Total revenue from contracts with customers
|
742
|
3,710
|
16
|
4,468
|
Other non-contract fee income
|
-
|
55
|
-
|
55
|
Fee and commission income
|
742
|
3,765
|
16
|
4,523
|
Fee and commission expense
|
(172)
|
(847)
|
(15)
|
(1,034)
|
Net fee and commission income
|
570
|
2,918
|
1
|
3,489
|
Transactional
fees are service charges on deposit accounts, cash management
services and transactional processing fees. This includes
interchange and merchant fee income generated from credit and bank
card usage.
Advisory
fees are generated from asset management services and advisory
services related to mergers, acquisitions and financial
restructuring.
Brokerage
and execution fees are earned for executing client transactions
with exchanges and over-the-counter markets and assisting clients
in clearing transactions.
Underwriting and syndication fees are earned for the distribution
of client equity or debt securities and the arrangement and
administration of a loan syndication. This includes commitment fees
to provide loan financing.
|
Half year ended
|
Half year ended
|
|
30.06.19
|
30.06.18
|
Compensation costs
|
£m
|
£m
|
Current year bonus charges
|
456
|
593
|
Deferred bonus charge
|
226
|
256
|
Commissions and other incentives
|
34
|
21
|
Performance costs
|
716
|
870
|
Salaries
|
2,195
|
2,069
|
Social security costs
|
315
|
303
|
Post-retirement benefits
|
251
|
243
|
Other compensation costs
|
232
|
199
|
Total compensation costs
|
3,709
|
3,684
|
|
|
|
Other resourcing costs
|
|
|
Outsourcing
|
257
|
277
|
Redundancy and restructuring
|
49
|
60
|
Temporary staff costs
|
173
|
193
|
Other
|
76
|
63
|
Total other resourcing costs
|
555
|
593
|
|
|
|
Total staff costs
|
4,264
|
4,277
|
|
|
|
Barclays Group compensation costs as a % of total
income
|
34.4
|
33.7
|
No
material awards have yet been granted in relation to the 2019 bonus
pool as decisions regarding incentive awards are not taken by the
Remuneration Committee until the performance for the full year can
be assessed. The current year bonus charge for the first six months
represents an accrual for estimated costs in accordance with
accounting requirements.
5.
Infrastructure, administration and general expenses
|
Half year ended
|
Half year ended
|
|
30.06.19
|
30.06.18
|
Infrastructure costs
|
£m
|
£m
|
Property and equipment
|
691
|
685
|
Depreciation of property, plant and equipment
1
|
310
|
202
|
Lease rentals
1
|
21
|
128
|
Amortisation of intangible assets
|
419
|
412
|
Impairment of property, equipment and intangible
assets
|
29
|
1
|
Total infrastructure costs
|
1,470
|
1,428
|
|
|
|
Administration and general expenses
|
|
|
Consultancy, legal and professional fees
|
284
|
353
|
Subscriptions, publications, stationery and
communications
|
329
|
319
|
Marketing, advertising and sponsorship
|
212
|
195
|
Travel and accommodation
|
81
|
74
|
Other administration and general expenses
|
118
|
28
|
Total administration and general expenses
|
1,024
|
969
|
|
|
|
Total infrastructure, administration and general
expenses
|
2,494
|
2,397
|
1
|
Barclays adopted the accounting standard IFRS 16 on 1 January 2019.
The impact has been to increase the depreciation charge by
£113m as a result of
recognising a right of use asset and to reduce the operating lease
expense in H119. The prior period comparatives have not been
restated.
See Note 1
for further details.
|
The tax
charge for H119 was £545m (H118: £644m), representing an
effective tax rate of 18.1% (H118: 38.8%). The effective tax rate
for H119 was substantially lower than H118, primarily due to
charges for litigation and conduct in H118 which were
non-deductible for tax purposes. From 2019, a change in accounting
standards has required tax relief on payments made under AT1
instruments, which in prior periods was recognised in retained
earnings, to be recognised in the income statement. Excluding this
accounting change, the Group’s effective tax rate would have
been 21.3%.
|
Assets
|
|
Liabilities
|
|
As at
|
As at
|
|
As at
|
As at
|
|
30.06.19
|
31.12.18
|
|
30.06.19
|
31.12.18
|
Current and deferred tax assets and liabilities
|
£m
|
£m
|
|
£m
|
£m
|
Current tax
|
884
|
798
|
|
(616)
|
(628)
|
Deferred tax
|
3,142
|
3,828
|
|
(5)
|
(51)
|
Total
|
4,026
|
4,626
|
|
(621)
|
(679)
|
|
As at
|
As at
|
|
30.06.19
|
31.12.18
|
Deferred tax assets and liabilities
|
£m
|
£m
|
USA
|
2,293
|
2,541
|
UK
|
438
|
861
|
Other
|
411
|
426
|
Deferred tax assets
|
3,142
|
3,828
|
Deferred tax liabilities
|
(5)
|
(51)
|
|
|
|
Analysis of deferred tax assets
|
|
|
Temporary differences
|
2,754
|
3,299
|
Tax losses
|
388
|
529
|
Deferred tax assets
|
3,142
|
3,828
|
|
|
|
|
|
|
7.
Non-controlling interests
|
Profit attributable to
non-controlling interests
|
|
Equity attributable to
non-controlling interests
|
|
Half year ended
|
Half year ended
|
|
As at
|
As at
|
|
30.06.19
|
30.06.18
|
|
30.06.19
|
31.12.18
|
|
£m
|
£m
|
|
£m
|
£m
|
Barclays Bank PLC issued:
|
|
|
|
|
|
- Preference shares
|
27
|
106
|
|
529
|
529
|
- Upper T2 instruments
|
7
|
3
|
|
691
|
691
|
Other non-controlling interests
|
-
|
(1)
|
|
1
|
3
|
Total
|
34
|
108
|
|
1,221
|
1,223
|
|
Half year ended
|
Half year ended
|
|
30.06.19
|
30.06.18
|
|
£m
|
£m
|
Profit attributable to ordinary equity holders of the
parent
1
|
2,072
|
561
|
|
|
|
|
m
|
m
|
Basic weighted average number of shares in issue
|
17,178
|
17,067
|
Number of potential ordinary shares
|
200
|
258
|
Diluted weighted average number of shares
|
17,378
|
17,325
|
|
|
|
|
p
|
p
|
Basic earnings per ordinary share
1
|
12.1
|
3.3
|
Diluted earnings per ordinary share
1
|
11.9
|
3.2
|
1
From 2019, due to an IAS 12
update, the tax relief on payments in relation to AT1 instruments
has been recognised in the tax charge of the income statement,
whereas it was previously recorded in retained earnings.
Comparatives
have been restated, increasing the profit after tax for H118 by
£93m. This change does not impact earnings per share or return
on average tangible shareholders’ equity. Further detail can
be found
in Note 1,
Basis of preparation on pages 55 to 56.
9.
Dividends on ordinary shares
It is
Barclays’ policy to declare and pay dividends on a
semi-annual basis. A half year dividend for 2019 of 3.0p (H118:
2.5p) per ordinary share will be paid on 23 September 2019 to
shareholders on the share register on 9 August 2019.
|
Half year ended 30.06.19
|
Half year ended 30.06.18
|
|
Per share
|
Total
|
Per share
|
Total
|
Dividends paid during the period
|
p
|
£m
|
p
|
£m
|
Full year dividend paid during period
|
4.0
|
684
|
2.0
|
341
|
For
qualifying US and Canadian resident ADR holders, the half year
dividend of 3.0p per ordinary share becomes 12.0p per ADS
(representing four shares). The ADR depositary will post the half
year dividend on 23 September 2019 to ADR holders on the record at
close of business on 9 August 2019.
10. Derivative financial instruments
|
|
|
|
|
|
Contract notional amount
|
|
Fair value
|
|
|
Assets
|
Liabilities
|
As at 30.06.19
|
£m
|
|
£m
|
£m
|
Foreign exchange derivatives
|
5,325,619
|
|
56,446
|
(58,302)
|
Interest rate derivatives
|
43,634,276
|
|
154,780
|
(147,878)
|
Credit derivatives
|
799,556
|
|
13,013
|
(11,995)
|
Equity and stock index and commodity derivatives
|
1,172,578
|
|
19,801
|
(24,761)
|
Derivative assets/(liabilities) held for trading
|
50,932,029
|
|
244,040
|
(242,936)
|
|
|
|
|
|
Derivatives in hedge accounting relationships
|
|
|
|
|
Derivatives designated as cash flow hedges
|
74,976
|
|
8
|
(2)
|
Derivatives designated as fair value hedges
|
116,000
|
|
138
|
(103)
|
Derivatives designated as hedges of net investments
|
935
|
|
-
|
(62)
|
Derivative assets/(liabilities) designated in hedge accounting
relationships
|
191,911
|
|
146
|
(167)
|
|
|
|
|
|
Total recognised derivative assets/(liabilities)
|
51,123,940
|
|
244,186
|
(243,103)
|
|
|
|
|
|
As at 31.12.18
|
|
|
|
|
Foreign exchange derivatives
|
5,289,872
|
|
64,188
|
(64,127)
|
Interest rate derivatives
|
37,140,892
|
|
125,118
|
(120,628)
|
Credit derivatives
|
759,075
|
|
10,755
|
(9,519)
|
Equity and stock index and commodity derivatives
|
1,003,914
|
|
22,323
|
(25,304)
|
Derivative assets/(liabilities) held for trading
|
44,193,753
|
|
222,384
|
(219,578)
|
|
|
|
|
|
Derivatives in hedge accounting relationships
|
|
|
|
|
Derivatives designated as cash flow hedges
|
75,389
|
|
11
|
(6)
|
Derivatives designated as fair value hedges
|
101,845
|
|
143
|
(49)
|
Derivatives designated as hedges of net investments
|
2,968
|
|
-
|
(10)
|
Derivative assets/(liabilities) designated in hedge accounting
relationships
|
180,202
|
|
154
|
(65)
|
|
|
|
|
|
Total recognised derivative assets/(liabilities)
|
44,373,955
|
|
222,538
|
(219,643)
|
Derivative
financial instrument assets and liabilities increased £22bn to
£244bn and £23bn to £243bn respectively, mainly due
to an increase in interest rate derivatives.
The
IFRS netting posted against derivative assets was £40bn
including £5bn of cash collateral netted (December 2018:
£21bn including £2bn cash collateral netted) and
£40bn for liabilities including £6bn of cash collateral
netted (December 2018: £21bn including £3bn of cash
collateral netted). Derivative asset exposures would be £223bn
(December 2018: £203bn) lower than reported under IFRS if
netting were permitted for assets and liabilities with the same
counterparty or for which the Barclays Group holds cash collateral
of £37bn (December 2018: £31bn). Similarly, derivative
liabilities would be £223bn (December 2018: £202bn) lower
reflecting counterparty netting and cash collateral placed of
£37bn (December 2018: £30bn). In addition, non-cash
collateral of £5bn (December 2018: £6bn) was held in
respect of derivative assets and £4bn (December 2018:
£3bn) was placed in respect of derivative liabilities.
Collateral amounts are limited to net on balance sheet exposure so
as to not include over-collateralisation.
11.
Fair value of financial instruments
This
section should be read in conjunction with Note 17, Fair value of
financial instruments of the Barclays PLC Annual Report 2018 and
Note 1, Basis of preparation on pages 55 to 56, which provides more
detail about accounting policies adopted, valuation methodologies
used in calculating fair value and the valuation control framework
which governs oversight of valuations. There have been no changes
in the accounting policies adopted or the valuation methodologies
used.
Valuation
The
following table shows the Barclays Group’s assets and
liabilities that are held at fair value disaggregated by valuation
technique (fair value hierarchy) and balance sheet
classification:
|
Valuation technique using
|
|
|
|
Quoted market prices
|
Observable inputs
|
Significant unobservable inputs
|
|
|
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
|
Total
|
As at 30.06.19
|
£m
|
£m
|
£m
|
|
£m
|
Trading portfolio assets
|
58,456
|
58,377
|
3,548
|
|
120,381
|
Financial assets at fair value through the income
statement
|
10,853
|
140,578
|
8,274
|
|
159,705
|
Derivative financial instruments
|
6,004
|
232,481
|
5,701
|
|
244,186
|
Financial assets at fair value through other comprehensive
income
|
27,063
|
44,936
|
170
|
|
72,169
|
Investment property
|
-
|
-
|
8
|
|
8
|
Total assets
|
102,376
|
476,372
|
17,701
|
|
596,449
|
|
|
|
|
|
|
Trading portfolio liabilities
|
(25,714)
|
(17,004)
|
(6)
|
|
(42,724)
|
Financial liabilities designated at fair value
|
(98)
|
(229,451)
|
(304)
|
|
(229,853)
|
Derivative financial instruments
|
(5,728)
|
(232,576)
|
(4,799)
|
|
(243,103)
|
Total liabilities
|
(31,540)
|
(479,031)
|
(5,109)
|
|
(515,680)
|
|
|
|
|
|
|
As at 31.12.18
|
|
|
|
|
|
Trading portfolio assets
|
51,029
|
49,545
|
3,613
|
|
104,187
|
Financial assets at fair value through the income
statement
|
8,918
|
131,348
|
9,382
|
|
149,648
|
Derivative financial instruments
|
6,813
|
210,510
|
5,215
|
|
222,538
|
Financial assets at fair value through other comprehensive
income
|
19,764
|
32,697
|
355
|
|
52,816
|
Investment property
|
-
|
-
|
9
|
|
9
|
Total assets
|
86,524
|
424,100
|
18,574
|
|
529,198
|
|
|
|
|
|
|
Trading portfolio liabilities
|
(20,654)
|
(17,225)
|
(3)
|
|
(37,882)
|
Financial liabilities designated at fair value
|
(76)
|
(216,478)
|
(280)
|
|
(216,834)
|
Derivative financial liabilities
|
(6,152)
|
(208,748)
|
(4,743)
|
|
(219,643)
|
Total liabilities
|
(26,882)
|
(442,451)
|
(5,026)
|
|
(474,359)
|
The
following table shows the Barclays Group’s assets and
liabilities that are held at fair value disaggregated by valuation
technique (fair value hierarchy) and product type:
|
Assets
|
Liabilities
|
|
Valuation technique using
|
Valuation technique using
|
|
Quoted
market prices
(Level 1)
|
Observable
inputs
(Level 2)
|
Significant
unobservable
inputs
(Level 3)
|
Quoted
market prices
(Level 1)
|
Observable
inputs
(Level 2)
|
Significant
unobservable
inputs
(Level 3)
|
As at 30.06.19
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Interest rate derivatives
|
-
|
152,606
|
2,320
|
-
|
(145,912)
|
(2,071)
|
Foreign exchange derivatives
|
-
|
56,237
|
209
|
-
|
(58,075)
|
(289)
|
Credit derivatives
|
-
|
11,565
|
1,448
|
-
|
(11,626)
|
(369)
|
Equity derivatives
|
6,004
|
10,871
|
1,711
|
(5,728)
|
(15,801)
|
(2,057)
|
Commodity derivatives
|
-
|
1,202
|
13
|
-
|
(1,162)
|
(13)
|
Government and government sponsored debt
|
53,418
|
63,687
|
2
|
(12,596)
|
(11,868)
|
-
|
Corporate debt
|
-
|
20,662
|
616
|
-
|
(5,671)
|
(6)
|
Certificates of deposit, commercial paper and other money market
instruments
|
-
|
554
|
-
|
-
|
(7,939)
|
(21)
|
Margin lending
|
-
|
15,306
|
-
|
-
|
(23,860)
|
-
|
Reverse repurchase and repurchase agreements
|
-
|
122,021
|
13
|
-
|
(148,829)
|
-
|
Non-asset backed loans
|
-
|
7,383
|
7,930
|
-
|
-
|
-
|
Asset backed securities
|
-
|
3,193
|
669
|
-
|
(28)
|
-
|
Issued debt
|
-
|
-
|
-
|
-
|
(47,402)
|
(263)
|
Equity cash products
|
42,852
|
10,190
|
357
|
(13,118)
|
(804)
|
-
|
Private equity investments
|
4
|
-
|
913
|
-
|
-
|
(20)
|
Other
1
|
98
|
895
|
1,500
|
(98)
|
(54)
|
-
|
Total
|
102,376
|
476,372
|
17,701
|
(31,540)
|
(479,031)
|
(5,109)
|
|
|
|
|
|
|
|
As at 31.12.18
|
|
|
|
|
|
|
Interest rate derivatives
|
-
|
122,794
|
2,478
|
-
|
(118,227)
|
(2,456)
|
Foreign exchange derivatives
|
-
|
63,996
|
192
|
-
|
(63,952)
|
(185)
|
Credit derivatives
|
-
|
9,373
|
1,381
|
-
|
(9,188)
|
(331)
|
Equity derivatives
|
6,813
|
12,934
|
1,136
|
(6,152)
|
(16,001)
|
(1,743)
|
Commodity derivatives
|
-
|
1,413
|
28
|
-
|
(1,380)
|
(28)
|
Government and government sponsored debt
|
41,812
|
51,644
|
14
|
(9,396)
|
(11,171)
|
-
|
Corporate debt
|
-
|
14,664
|
456
|
-
|
(5,061)
|
-
|
Certificates of deposit, commercial paper and other money market
instruments
|
-
|
1,135
|
-
|
-
|
(8,556)
|
(10)
|
Margin lending
|
-
|
10,388
|
-
|
-
|
(26,875)
|
-
|
Reverse repurchase and repurchase agreements
|
-
|
118,273
|
768
|
-
|
(138,460)
|
-
|
Non-asset backed loans
|
-
|
7,406
|
8,304
|
-
|
-
|
-
|
Asset backed securities
|
-
|
2,314
|
688
|
-
|
(245)
|
-
|
Issued debt
|
-
|
-
|
-
|
-
|
(42,101)
|
(251)
|
Equity cash products
|
37,816
|
7,195
|
698
|
(11,258)
|
(1,181)
|
(3)
|
Private equity investments
|
7
|
-
|
1,071
|
-
|
-
|
(19)
|
Other
1
|
76
|
571
|
1,360
|
(76)
|
(53)
|
-
|
Total
|
86,524
|
424,100
|
18,574
|
(26,882)
|
(442,451)
|
(5,026)
|
1
|
Other includes commercial real estate loans, funds and fund-linked
products, asset backed loans, physical commodities and investment
property.
|
Assets and liabilities reclassified between Level 1 and Level
2
During
the period, there were no material transfers between Level 1 and
Level 2 (period ended December 2018: no material transfers between
Level 1 and Level 2).
Level 3 movement analysis
The
following table summarises the movements in the balances of Level 3
assets and liabilities during the period. The table shows gains and
losses and includes amounts for all financial assets and
liabilities that are held at fair value transferred to and from
Level 3 during the period. Transfers have been reflected as if they
had taken place at
the
beginning of the year.
Asset
and liability moves between Level 2 and Level 3 are primarily due
to i) an increase or decrease in observable market activity related
to an input or ii) a change in the significance of the unobservable
input, with assets and liabilities classified as Level 3 if an
unobservable input is deemed significant.
Level 3 movement analysis
|
|
As at
01.01.19
|
Purchases
|
Sales
|
Issues
|
Settle-
ments
|
Total gains and losses in the period recognised in the income
statement
|
Transfers
|
As at
30.06.19
|
Trading
income
|
Other
income
|
In
|
Out
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Government and government sponsored debt
|
14
|
2
|
-
|
-
|
-
|
-
|
-
|
-
|
(14)
|
2
|
Corporate debt
|
388
|
70
|
(24)
|
-
|
(31)
|
14
|
-
|
32
|
(74)
|
375
|
Non-asset backed loans
|
2,263
|
1,235
|
(1,260)
|
-
|
(19)
|
12
|
-
|
19
|
(90)
|
2,160
|
Asset backed securities
|
664
|
81
|
(127)
|
-
|
-
|
5
|
-
|
16
|
(29)
|
610
|
Equity cash products
|
136
|
48
|
(13)
|
-
|
-
|
(2)
|
-
|
116
|
(20)
|
265
|
Other
|
148
|
-
|
-
|
-
|
(1)
|
(10)
|
-
|
-
|
(1)
|
136
|
Trading portfolio assets
|
3,613
|
1,436
|
(1,424)
|
-
|
(51)
|
19
|
-
|
183
|
(228)
|
3,548
|
|
|
|
|
|
|
|
|
|
|
|
Non-asset backed loans
|
5,688
|
2
|
-
|
-
|
(295)
|
248
|
-
|
-
|
(9)
|
5,634
|
Equity cash products
|
559
|
9
|
-
|
-
|
(10)
|
4
|
178
|
-
|
-
|
740
|
Private equity investments
|
1,071
|
21
|
(73)
|
-
|
(1)
|
-
|
43
|
-
|
(148)
|
913
|
Other
|
2,064
|
2,334
|
(2,619)
|
-
|
(2)
|
17
|
9
|
24
|
(840)
|
987
|
Financial assets at fair value through the income
statement
|
9,382
|
2,366
|
(2,692)
|
-
|
(308)
|
269
|
230
|
24
|
(997)
|
8,274
|
|
|
|
|
|
|
|
|
|
|
|
Non-asset backed loans
|
353
|
48
|
-
|
-
|
(55)
|
-
|
-
|
-
|
(218)
|
128
|
Asset backed securities
|
-
|
40
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
40
|
Equity cash products
|
2
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
2
|
Financial assets at fair value through other comprehensive
income
|
355
|
88
|
-
|
-
|
(55)
|
-
|
-
|
-
|
(218)
|
170
|
|
|
|
|
|
|
|
|
|
|
|
Investment property
|
9
|
-
|
-
|
-
|
-
|
-
|
(1)
|
-
|
-
|
8
|
|
|
|
|
|
|
|
|
|
|
|
Trading portfolio liabilities
|
(3)
|
-
|
-
|
-
|
-
|
2
|
-
|
(5)
|
-
|
(6)
|
|
|
|
|
|
|
|
|
|
|
|
Certificates of deposit, commercial paper and other money market
instruments
|
(10)
|
-
|
-
|
-
|
1
|
-
|
(1)
|
(11)
|
-
|
(21)
|
Issued debt
|
(251)
|
-
|
-
|
(16)
|
1
|
5
|
-
|
(3)
|
1
|
(263)
|
Other
|
(19)
|
-
|
-
|
-
|
-
|
-
|
(1)
|
-
|
-
|
(20)
|
Financial liabilities designated at fair value
|
(280)
|
-
|
-
|
(16)
|
2
|
5
|
(2)
|
(14)
|
1
|
(304)
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
22
|
(3)
|
-
|
-
|
76
|
116
|
-
|
(107)
|
145
|
249
|
Foreign exchange derivatives
|
7
|
-
|
-
|
-
|
(12)
|
(41)
|
-
|
(51)
|
17
|
(80)
|
Credit derivatives
|
1,050
|
(63)
|
4
|
-
|
(3)
|
86
|
-
|
2
|
3
|
1,079
|
Equity derivatives
|
(607)
|
(122)
|
(5)
|
-
|
23
|
89
|
-
|
(16)
|
292
|
(346)
|
Net derivative financial
instruments
1
|
472
|
(188)
|
(1)
|
-
|
84
|
250
|
-
|
(172)
|
457
|
902
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
13,548
|
3,702
|
(4,117)
|
(16)
|
(328)
|
545
|
227
|
16
|
(985)
|
12,592
|
1
|
Derivative financial instruments are represented on a net basis. On
a gross basis, derivative financial assets were £5,701m and
derivative financial liabilities were £4,799m.
|
Level 3 movement analysis
|
|
As at
01.01.18
|
Purchases
|
Sales
|
Issues
|
Settle-
ments
|
Total gains and losses in the period recognised in the income
statement
|
Transfers
|
As at
30.06.18
|
Trading
income
|
Other
income
|
In
|
Out
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Government and government sponsored debt
|
49
|
11
|
-
|
-
|
-
|
-
|
-
|
-
|
(35)
|
25
|
Corporate debt
|
871
|
35
|
(17)
|
-
|
(23)
|
6
|
-
|
15
|
(6)
|
881
|
Non-asset backed loans
|
166
|
2,239
|
(239)
|
-
|
-
|
2
|
-
|
11
|
(6)
|
2,173
|
Asset backed securities
|
627
|
100
|
(99)
|
-
|
-
|
(11)
|
-
|
5
|
(30)
|
592
|
Equity cash products
|
68
|
-
|
(7)
|
-
|
-
|
35
|
-
|
75
|
(52)
|
119
|
Other
|
196
|
4
|
(4)
|
-
|
(10)
|
(21)
|
-
|
24
|
(138)
|
51
|
Trading portfolio assets
|
1,977
|
2,389
|
(366)
|
-
|
(33)
|
11
|
-
|
130
|
(267)
|
3,841
|
|
|
|
|
|
|
|
|
|
|
|
Non-asset backed loans
|
6,073
|
16
|
-
|
-
|
(510)
|
(8)
|
-
|
-
|
(4)
|
5,567
|
Equity cash products
|
8
|
11
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
19
|
Private equity investments
|
688
|
295
|
(37)
|
-
|
-
|
-
|
53
|
-
|
(14)
|
985
|
Other
|
750
|
2,359
|
(1,967)
|
-
|
-
|
4
|
110
|
-
|
-
|
1,256
|
Financial assets at fair value through the income
statement
|
7,519
|
2,681
|
(2,004)
|
-
|
(510)
|
(4)
|
163
|
-
|
(18)
|
7,827
|
|
|
|
|
|
|
|
|
|
|
|
Equity cash products
|
36
|
-
|
(17)
|
-
|
-
|
-
|
-
|
-
|
(18)
|
1
|
Private equity investments
|
129
|
-
|
(12)
|
-
|
-
|
-
|
-
|
-
|
(14)
|
103
|
Other
|
40
|
-
|
(39)
|
-
|
-
|
-
|
-
|
-
|
-
|
1
|
Financial assets at fair value through other comprehensive
income
|
205
|
-
|
(68)
|
-
|
-
|
-
|
-
|
-
|
(32)
|
105
|
|
|
|
|
|
|
|
|
|
|
|
Investment property
|
116
|
-
|
(104)
|
-
|
(5)
|
-
|
4
|
-
|
-
|
11
|
|
|
|
|
|
|
|
|
|
|
|
Trading portfolio liabilities
|
(4)
|
-
|
2
|
-
|
-
|
-
|
-
|
2
|
-
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Certificates of deposit, commercial paper and other money market
instruments
|
(250)
|
-
|
202
|
-
|
-
|
-
|
-
|
-
|
-
|
(48)
|
Issued debt
|
(214)
|
-
|
-
|
(4)
|
4
|
19
|
-
|
(219)
|
125
|
(289)
|
Other
|
(16)
|
-
|
16
|
-
|
2
|
-
|
(2)
|
-
|
-
|
-
|
Financial liabilities designated at fair value
|
(480)
|
-
|
218
|
(4)
|
6
|
19
|
(2)
|
(219)
|
125
|
(337)
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
(150)
|
-
|
-
|
-
|
96
|
(46)
|
-
|
(343)
|
58
|
(385)
|
Foreign exchange derivatives
|
37
|
-
|
-
|
-
|
(17)
|
(30)
|
-
|
8
|
(18)
|
(20)
|
Credit derivatives
|
1,146
|
2
|
3
|
-
|
(15)
|
(210)
|
-
|
1
|
(2)
|
925
|
Equity derivatives
|
(896)
|
22
|
(431)
|
-
|
221
|
129
|
-
|
33
|
175
|
(747)
|
Net derivative financial
instruments
1
|
137
|
24
|
(428)
|
-
|
285
|
(157)
|
-
|
(301)
|
213
|
(227)
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
9,470
|
5,094
|
(2,750)
|
(4)
|
(257)
|
(131)
|
165
|
(388)
|
21
|
11,220
|
1
|
Derivative financial instruments are represented on a net basis. On
a gross basis, derivative financial assets were £5,066m and
derivative financial liabilities were £5,293m.
|
Unrealised gains and losses on Level 3 financial assets and
liabilities
The
following table discloses the unrealised gains and losses
recognised in the period arising on Level 3 financial assets and
liabilities held at the period end.
|
Half year ended 30.06.19
|
Half year ended 30.06.18
|
|
Income statement
|
Total
|
Income statement
|
Total
|
|
Trading
income
|
Other
income
|
Trading
income
|
Other
income
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Trading portfolio assets
|
21
|
-
|
21
|
(3)
|
-
|
(3)
|
Financial assets at fair value through the income
statement
|
253
|
205
|
458
|
(5)
|
116
|
111
|
Investment properties
|
-
|
(1)
|
(1)
|
-
|
-
|
-
|
Trading portfolio liabilities
|
2
|
-
|
2
|
-
|
-
|
-
|
Financial liabilities designated at fair value
|
6
|
-
|
6
|
18
|
-
|
18
|
Net derivative financial instruments
|
212
|
-
|
212
|
(155)
|
-
|
(155)
|
Total
|
494
|
204
|
698
|
(145)
|
116
|
(29)
|
Valuation techniques and sensitivity analysis
Sensitivity
analysis is performed on products with significant unobservable
inputs (Level 3) to generate a range of reasonably possible
alternative valuations. The sensitivity methodologies applied take
account of the nature of valuation techniques used, as well as the
availability and reliability of observable proxy and historical
data and the impact of using alternative models.
Current
year valuation and sensitivity methodologies are consistent with
those described within Note 17, Fair value of financial
instruments
in the
Barclays PLC Annual Report 2018.
Sensitivity analysis of valuations using unobservable
inputs
|
|
As at 30.06.19
|
As at 31.12.18
|
|
Favourable
changes
|
Unfavourable
changes
|
Favourable
changes
|
Unfavourable
changes
|
|
£m
|
£m
|
£m
|
£m
|
Interest rate derivatives
|
52
|
(118)
|
80
|
(162)
|
Foreign exchange derivatives
|
11
|
(14)
|
7
|
(10)
|
Credit derivatives
|
125
|
(79)
|
126
|
(73)
|
Equity derivatives
|
107
|
(108)
|
110
|
(112)
|
Commodity derivatives
|
1
|
(1)
|
1
|
(1)
|
Corporate debt
|
12
|
(10)
|
10
|
(2)
|
Non-asset backed loans
|
253
|
(529)
|
274
|
(458)
|
Equity cash products
|
130
|
(173)
|
121
|
(155)
|
Private equity investments
|
236
|
(247)
|
230
|
(241)
|
Other
1
|
2
|
(2)
|
2
|
(2)
|
Total
|
929
|
(1,281)
|
961
|
(1,216)
|
1
|
Other includes commercial real estate loans, funds and fund-linked
products, asset backed loans, physical commodities and investment
property.
|
The
effect of stressing unobservable inputs to a range of reasonably
possible alternatives, alongside considering the impact of using
alternative models, would be to increase fair values by up to
£929m (December 2018: £961m) or to decrease fair values
by up to £1,281m (December 2018: £1,216m) with all the
potential effect impacting profit and loss.
Significant unobservable inputs
The
valuation techniques and significant unobservable inputs for assets
and liabilities recognised at fair value and classified as Level 3
are consistent with Note 17, Fair value of financial instruments in
the Barclays PLC Annual Report 2018. The description of the
significant unobservable inputs and the sensitivity of fair value
measurement of the instruments categorised as Level 3 assets or
liabilities to increases in significant unobservable inputs is also
found in Note 17, Fair value of financial instruments of the
Barclays PLC Annual Report 2018.
Fair value adjustments
Key
balance sheet valuation adjustments are quantified
below:
|
As at
|
As at
|
|
30.06.19
|
31.12.18
|
|
£m
|
£m
|
Exit price adjustments derived from market bid-offer
spreads
|
(455)
|
(457)
|
Uncollateralised derivative funding
|
(60)
|
(47)
|
Derivative credit valuation adjustments
|
(149)
|
(125)
|
Derivative debit valuation adjustments
|
192
|
237
|
●
|
Uncollateralised
derivative funding increased by £13m to £60m as a result
of changes in underlying derivative
exposures
|
●
|
Derivative credit
valuation adjustments
increased by £24m to £149m
as a result of
changes in underlying
derivative exposures
|
●
|
Derivative debit
valuation adjustments
decreased by £45m to
£192m
as a result of
tightening in Barclays’ credit spreads
|
Portfolio exemption
The
Barclays Group uses the portfolio exemption in IFRS 13, Fair Value
Measurement to measure the fair value of groups of financial assets
and liabilities. Instruments are measured using the price that
would be received to sell a net long position (i.e. an asset) for a
particular risk exposure or to transfer a net short position (i.e.
a liability) for a particular risk exposure in an orderly
transaction between market participants at the balance sheet date
under current market conditions. Accordingly, the Barclays Group
measures the fair value of the group of financial assets and
liabilities consistently with how market participants would price
the net risk exposure at the measurement date.
Unrecognised gains as a result of the use of valuation models using
unobservable inputs
The
amount that has yet to be recognised in income that relates to the
difference between the transaction price (the fair value at initial
recognition) and the amount that would have arisen had valuation
models using unobservable inputs been used on initial recognition,
less amounts subsequently recognised, is £120m (December 2018:
£141m) for financial instruments measured at fair value and
£257m (December 2018: £262m) for financial instruments
carried at amortised cost. There are additions of £24m
(December 2018: £65m) and amortisation and releases of
£45m (December 2018: £33m) for financial instruments
measured at fair value and additions of £1m (December 2018:
£29m) and amortisation and releases of £6m (December
2018: £20m) for financial instruments carried at amortised
cost.
Third party credit enhancements
Structured
and brokered certificates of deposit issued by Barclays Group are
insured up to $250,000 per depositor by the Federal Deposit
Insurance Corporation (FDIC) in the United States. The FDIC is
funded by premiums that Barclays and other banks pay for deposit
insurance coverage. The carrying value of these issued certificates
of deposit that are designated under the IFRS 9 fair value option
includes this third party credit enhancement. The on balance sheet
value of these brokered certificates of deposit amounted to
£4,452m (December 2018: £4,797m).
Comparison of carrying amounts and fair values for assets and
liabilities not held at fair value
Valuation
methodologies employed in calculating the fair value of financial
assets and liabilities measured at amortised cost are consistent
with the Barclays PLC Annual Report 2018 disclosure.
The
following table summarises the fair value of financial assets and
liabilities measured at amortised cost on the Barclays
Group’s balance sheet.
|
As at 30.06.19
|
As at 31.12.18
|
|
Carrying
amount
|
Fair value
|
Carrying
amount
|
Fair value
|
Financial assets
|
£m
|
£m
|
£m
|
£m
|
Loans and advances at amortised cost
|
|
|
|
|
- Home loans
|
151,543
|
150,549
|
150,284
|
148,897
|
- Credit cards, unsecured loans and other retail
lending
|
56,304
|
57,822
|
54,560
|
56,462
|
- Finance lease receivables
|
2,035
|
2,178
|
1,886
|
2,057
|
- Corporate loans
|
129,437
|
127,374
|
119,676
|
117,848
|
Reverse repurchase agreements and other similar secured
lending
|
8,990
|
8,990
|
2,308
|
2,308
|
|
|
|
|
|
Financial liabilities
|
|
|
|
|
Deposits at amortised cost
|
|
|
|
|
- Banks
|
(16,975)
|
(16,975)
|
(14,166)
|
(14,166)
|
- Current and demand accounts
|
(152,586)
|
(152,586)
|
(148,714)
|
(148,714)
|
- Savings accounts
|
(138,830)
|
(138,830)
|
(137,589)
|
(137,589)
|
- Other time deposits
|
(105,205)
|
(105,213)
|
(94,369)
|
(94,388)
|
Repurchase agreements and other similar secured
borrowing
|
(18,322)
|
(18,322)
|
(18,578)
|
(18,578)
|
Debt securities in issue
|
(90,815)
|
(92,044)
|
(82,286)
|
(81,687)
|
Subordinated liabilities
|
(18,803)
|
(18,965)
|
(20,559)
|
(21,049)
|
12. Subordinated liabilities
|
|
Half year
ended
|
Year ended
|
|
30.06.19
|
31.12.18
|
|
£m
|
£m
|
Opening balance as at 1 January
|
20,559
|
23,826
|
Issuances
|
1,271
|
221
|
Redemptions
|
(3,091)
|
(3,246)
|
Other
|
64
|
(242)
|
Closing balance
|
18,803
|
20,559
|
Issuances
of £1,271m include $1,500m 5.088% Fixed-to-Floating Rate
Subordinated Notes (£1,194m) and £77m USD Floating Rate
Notes.
Redemption
totalling £3,091m include £3,000m 14% Step-up Callable
Perpetual Reserve Capital Instruments and £77m USD Floating
Rate Notes. Barclays Securities Japan Limited redeemed two JPY
1,000m dated loans during the year, totalling
£14m.
Other
movements predominantly include fair value hedge adjustments,
accrued interest and foreign exchange movements.
13. Provisions
|
|
|
|
As at
|
As at
|
|
30.06.19
|
31.12.18
|
|
£m
|
£m
|
PPI redress
|
360
|
888
|
Other customer redress
|
385
|
444
|
Legal, competition and regulatory matters
|
227
|
414
|
Redundancy and restructuring
|
145
|
169
|
Undrawn contractually committed facilities and
guarantees
|
297
|
271
|
Onerous contracts
|
46
|
139
|
Sundry provisions
|
320
|
327
|
Total
|
1,780
|
2,652
|
PPI redress
As at
30 June 2019, Barclays had recognised cumulative provisions of
£9.6bn (December 2018: £9.6bn). Utilisation of the
cumulative provisions to date is £9.2bn (December 2018:
£8.7bn), leaving a residual provision of £360m (December
2018: £888m).
Through
to 30 June 2019, 2.6m (December 2018: 2.4m) customer initiated
claims
1
had been received and processed.
The
current provision reflects the estimated cost of PPI redress
primarily relating to customer initiated complaints and on-going
remediation programmes, based on information available at June
2019. This also includes liabilities managed by third parties
arising from portfolios previously sold where Barclays remains
liable.
As at
30 June 2019, the provision of £360m represents
Barclays’ best estimate of expected PPI related costs in
light of the complaints deadline implemented by the FCA of 29
August 2019. However, it is possible the eventual cumulative
provision outcome may differ from the current estimate. Barclays
will continue to review the adequacy of the provision in respect of
the future impacts, including after the complaints deadline as not
all costs will be settled at that point.
The PPI
provision is calculated using a number of assumptions, which
continue to involve significant modelling and management
judgement:
|
●
|
Customer
initiated claim volumes – claims received but not yet
processed plus an estimate of future claims initiated by customers,
where the increase in volume is anticipated to cease after the PPI
deadline.
|
|
●
|
Average
claim redress – the expected average payment to customers for
upheld claims based on the type and age of the
policy/policies.
|
|
●
|
Processing
cost per claim – the cost of assessing and processing each
valid claim.
|
These
assumptions remain subjective, mainly due to the uncertainty
associated with the remaining future claims levels, which include
complaints driven by Claims Management Company (CMC)
activity
and the FCA
advertising campaign.
In
addition, these assumptions are subject to recent investigations
and queries by the Official Receiver in respect of bankruptcy
estates, the impact of which cannot be reliably estimated at this
time.
The
following table outlines key forecast assumptions used in the
provision calculation as at 30 June 2019, and a sensitivity
analysis illustrating the impact on the provision, if the future
expected assumptions prove too high or too low.
Assumption
|
Cumulative actual to 30.06.19
|
Future expected policy claims
|
Sensitivity analysis
increase/decrease in provision
|
Customer initiated claims received and processed
(thousands)
1
|
2,600
|
134
|
50k = £120m
|
Average uphold rate per claim (%)
2
|
89
|
87
|
1% = £3m
|
Average redress per valid claim (£)
3
|
2,143
|
2,286
|
£100 = £12m
|
1
|
Total mis-selling claims received by Barclays, including those
received via CMCs but excluding those for which no PPI policy
exists and excluding recent investigations and queries by the
Official Receiver in respect of bankruptcy estates (the impact of
which cannot be reliably estimated at this time) and responses to
proactive mailing. The sensitivity analysis has been calculated to
show the impact of a 50,000 increase or decrease in the number of
customer initiated mis-selling policy claims would have on the
provision level inclusive of operational processing
costs.
|
2
|
Average uphold rate per customer initiated mis-selling claims
received by Barclays and proactive mailings, excluding those for
which no PPI policy exists.
The sensitivity analysis has been calculated to show the impact a
1% change in the average uphold rate per claim would have on the
provision level.
|
3
|
Average redress stated on a per policy basis for future customer
initiated mis-selling complaints received by Barclays.
T
he
sensitivity analysis has
been calculated to show the impact a £100 increase or decrease
in the average redress per claim would have on the provision
level.
|
As at
30 June 2019, the Barclays Group’s IAS 19 pension surplus
across all schemes was £1.6bn (December 2018: £1.5bn).
The UK Retirement Fund (UKRF), which is the Barclays Group’s
main scheme, had an IAS 19 pension surplus of £1.8bn (December
2018: £1.7bn). The movement for the UKRF was driven by higher
than assumed asset returns and payment of a deficit reduction
contribution, offset by a decrease in the discount
rate.
UKRF funding valuations
The
Scheme Actuary prepares an annual update of the UKRF funding
position in addition to the full triennial actuarial valuation. The
latest annual update was carried out as at 30 September 2018 and
showed a deficit of £4.0bn and a funding level of
88.4%.
The
last triennial actuarial valuation of the UKRF had an effective
date of 30 September 2016 and was completed in July 2017. This
valuation showed a funding deficit of £7.9bn and a funding
level of 81.5%.
The
improvement in funding position between 30 September 2016 and 30
September 2018 was largely due to payment of deficit reduction
contributions, higher than assumed asset returns, higher government
bond yields and transfers out of the scheme.
The
recovery plan agreed as part of the 2016 triennial actuarial
valuation requires Barclays Bank PLC to pay deficit reduction
contributions of £0.5bn per annum between 2018 and 2020,
followed by £1.0bn per annum between 2021 and 2026. The
deficit reduction contributions are in addition to the regular
contributions to meet the Barclays Group’s share of the cost
of benefits accruing over each year. The agreement with the UKRF
Trustee also takes into account the changes to the Barclays Group
structure that were implemented as a result of ring-fencing.
Barclays Bank PLC remains as the principal employer of the UKRF.
Additional support measures agreed include a collateral
arrangement, joint participation of Barclays Bank UK PLC until
2025, and support from Barclays PLC should Barclays Bank PLC not
pay the deficit reduction contributions to the UKRF.
The
next triennial actuarial valuation of the UKRF is due to be
completed in 2020 with an effective date of 30 September
2019.
15.
Called up share capital
Called
up share capital comprised 17,245m (December 2018: 17,133m)
ordinary shares of 25p each. The increase was due to the issuance
of shares under employee share schemes and the Barclays PLC Scrip
Dividend Programme.
Half year ended 30.06.19
|
Ordinary
share capital
£m
|
Share
premium
£m
|
Total share
capital and
share
premium
£m
|
Opening balance as at 1 January
|
4,283
|
28
|
4,311
|
Movement
|
28
|
155
|
183
|
Closing balance
|
4,311
|
183
|
4,494
|
16. Other equity instruments
|
|
Half year
ended
|
Year ended
|
|
30.06.19
|
31.12.18
|
|
£m
|
£m
|
Opening balance as at 1 January
|
9,632
|
8,941
|
Issuances
|
2,504
|
1,925
|
Redemptions
|
-
|
(1,233)
|
Other
|
(13)
|
(1)
|
Closing balance
|
12,123
|
9,632
|
Other equity instruments of £
12,123m (December 2018: £
9,632m) include AT1 securities issued by Barclays
PLC. During the period, Barclays PLC issued $
2.0bn
8% Fixed
Rate Resetting Perpetual Subordinated Contingent Convertible
Securities and £
1.0bn
7.125%
Fixed Rate Resetting Perpetual Subordinated Contingent Convertible
Securities.
The AT1 securities are perpetual securities with no fixed maturity
and are structured to qualify as AT1 instruments under CRR. AT1
securities are undated and are repayable, at the option of Barclays
PLC, in whole at the initial call date, or on any fifth anniversary
after the initial call date. In addition, the AT1 securities are
repayable, at the option of Barclays PLC, in whole in the event of
certain changes in the tax or regulatory treatment of the
securities. Any repayments require the prior consent of the
PRA.
All
Barclays PLC AT1 securities will be converted into ordinary shares
of Barclays PLC, at a pre-determined price, should the fully loaded
CET1 ratio of the Barclays Group fall below 7%.
17. Other reserves
|
|
|
|
As at
|
As at
|
|
30.06.19
|
31.12.18
|
|
£m
|
£m
|
Currency translation reserve
|
4,065
|
3,888
|
Fair value through other comprehensive income reserve
|
247
|
(258)
|
Cash flow hedging reserve
|
1,188
|
660
|
Own credit reserve
|
(77)
|
(121)
|
Other reserves and treasury shares
|
980
|
984
|
Total
|
6,403
|
5,153
|
Currency translation reserve
The
currency translation reserve represents the cumulative gains and
losses on the retranslation of the Barclays Group’s net
investment in foreign operations, net of the effects of
hedging.
As at
30 June 2019, there was a credit balance of £4,065m (December
2018: £3,888m credit) in the currency translation reserve. The
£177m credit movement principally reflected the strengthening
of period end USD against GBP.
Fair value through other comprehensive income reserve
The
fair value through other comprehensive income reserve represents
the unrealised change in the fair value through other comprehensive
income investments since initial recognition.
As at
30 June 2019, there was a credit balance of £247m (December
2018: £258m debit) in the fair value through other
comprehensive income reserve. The gain of £505m is principally
reflected by a £721m gain from the increase in fair value of
bonds due to decreasing bond yields and a gain of £125m due to
an increase in the Absa Group Limited share price. This was
partially offset by £216m of net gains transferred to net
profit and a tax charge of £126m.
Cash flow hedging reserve
The
cash flow hedging reserve represents the cumulative gains and
losses on effective cash flow hedging instruments that will be
recycled to the income statement when the hedged transactions
affect profit or loss.
As at
30 June 2019, there was a credit balance of £1,188m (December
2018: £660m credit) in the cash flow hedging reserve. The
increase of £528m principally reflected a £806m increase
in the fair value of interest rate swaps held for hedging purposes
as major interest rate curves decreased, partially offset by
£114m of gains transferred to net profit and a tax charge of
£167m.
Own credit reserve
The own
credit reserve reflects the cumulative own credit gains and losses
on financial liabilities at fair value. Amounts in the own credit
reserve are not recycled to profit or loss in future
periods.
As at
30 June 2019, there was a debit balance of £77m (December
2018: £121m debit) in the own credit reserve. The movement of
£44m is principally reflected by the widening of
Barclays’ funding spreads of £68m, partially offset by
tax of £24m.
Other reserves and treasury shares
Other reserves relate to redeemed ordinary and preference shares
issued by the Barclays Group. Treasury shares relate to Barclays
PLC shares held principally in relation to the Barclays
Group’s various share schemes.
As at 30 June 2019, there was a credit balance of
£
980m (December 2018:
£
984m credit) in other
reserves. This included a debit balance of
£
31m (December 2018:
£
27m debit) relating to
treasury shares. During the period, £
207m (December 2018: £
267m) net purchases of treasury shares were made,
mainly reflecting the increase in shares held for the purposes of
employee share schemes, and £
203m (December 2018: £
268m) was transferred to retained earnings
reflecting the vesting of deferred share-based
payments.
18. Contingent liabilities and commitments
|
|
|
|
As at
|
As at
|
|
30.06.19
|
31.12.18
|
Contingent liabilities
|
£m
|
£m
|
Guarantees and letters of credit pledged as collateral
security
|
16,836
|
15,805
|
Performance guarantees, acceptances and endorsements
|
5,921
|
4,498
|
Total
|
22,757
|
20,303
|
|
|
|
Commitments
|
|
|
Documentary credits and other short-term trade related
transactions
|
1,273
|
1,741
|
Standby facilities, credit lines and other commitments
|
333,621
|
322,482
|
Total
|
334,894
|
324,223
|
In
addition to the above, Note 19
,
Legal, competition and regulatory
matters details out further contingent liabilities where it is not
practicable to disclose an estimate of the potential financial
effect on Barclays.
19.
Legal, competition and regulatory matters
Members
of the Barclays Group face legal, competition and regulatory
challenges, many of which are beyond our control. The extent of the
impact on Barclays of these matters cannot always be predicted but
may materially impact our operations, financial results, condition
and prospects. Matters arising from a set of similar circumstances
can give rise to either a contingent liability or a provision, or
both, depending on the relevant facts and circumstances. The
recognition of provisions in relation to such matters involves
critical accounting estimates and judgments in accordance with the
relevant accounting policies as described in Note 13, Provisions.
We have not disclosed an estimate of the potential financial effect
on Barclays of contingent liabilities where it is not currently
practicable to do so.
Matters
are ordered under headings corresponding to the financial
statements in which they are disclosed.
1.
Barclays
PLC and Barclays Bank PLC
Investigations into certain advisory services agreements and other
matters and civil action
The UK
Serious Fraud Office (SFO), the Financial Conduct Authority (FCA),
the US Department of Justice (DoJ) and the US Securities and
Exchange Commission (SEC) have been conducting investigations into
two advisory services agreements entered into by Barclays Bank PLC.
These agreements were entered into with Qatar Holding LLC in June
and October 2008 (the Agreements). The FCA commenced an
investigation into whether the Agreements may have related to
Barclays PLC’s capital raisings in June and November 2008
(the Capital Raisings). The existence of the June 2008 advisory
services agreement was disclosed, but the entry into the advisory
services agreement in October 2008 and the fees payable under the
Agreements, which amounted to a total of £322m payable over a
period of five years, were not disclosed in the announcements or
public documents relating to the Capital Raisings. The SFO also
commenced an investigation into the Agreements and into a $3bn loan
(the Loan) provided by Barclays Bank PLC in November 2008 to the
State of Qatar. In May 2018, the Crown Court dismissed all charges
against Barclays PLC and Barclays Bank PLC brought by the SFO, and
in October 2018, the High Court denied the SFO’s application
to reinstate the charges, which were consequently
dismissed.
FCA Proceedings and other investigations
In
2013, the FCA issued warning notices (the Notices) finding that,
while Barclays PLC and Barclays Bank PLC believed at the time of
the execution of the Agreements that there should be at least some
unspecified and undetermined value to be derived from them, the
primary purpose of the Agreements was not to obtain advisory
services but to make additional payments, which would not be
disclosed, for the Qatari participation in the Capital Raisings.
The Notices concluded that Barclays PLC and Barclays Bank PLC were
in breach of certain disclosure-related listing rules and Barclays
PLC was also in breach of Listing Principle 3 (the requirement to
act with integrity towards holders and potential holders of the
Company’s shares). In this regard, the FCA considers that
Barclays PLC and Barclays Bank PLC acted recklessly. The financial
penalty provided in the Notices against Barclays is £50m.
Barclays PLC and Barclays Bank PLC continue to contest the
findings. The FCA action has been stayed due to the SFO proceedings
pending against certain former Barclays executives.
In
addition, the DoJ and the SEC have been conducting investigations
relating to the Agreements.
Civil Action
In
2016, PCP Capital Partners LLP and PCP International Finance
Limited (PCP) served a claim on Barclays Bank PLC seeking damages
for fraudulent misrepresentation and deceit, arising from alleged
statements made by Barclays Bank PLC to PCP in relation to the
terms on which securities were to be issued to potential investors,
allegedly including PCP, in the November 2008 capital raising. PCP
seeks damages of approximately £1.6bn (plus interest from
November 2017) and costs. Barclays Bank PLC is defending the claim
and trial is scheduled to commence in June 2020.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on Barclays or what effect they
might have upon Barclays’ operating results, cash flows or
financial position in any particular period. The financial penalty
provided in the FCA’s Notices and the amount of PCP’s
claim do not necessarily reflect Barclays’ potential
financial exposure in respect of these matters.
Investigations into certain business relationships
In
2012, the DoJ and SEC commenced investigations in relation to
whether certain relationships with third parties who assist
Barclays PLC to win or retain business are compliant with the US
Foreign Corrupt Practices Act. Various regulators in other
jurisdictions are also being briefed on the investigations.
Separately, Barclays has been cooperating with the DoJ and SEC in
relation to an investigation into certain of its hiring practices
in Asia and elsewhere and is keeping certain regulators in other
jurisdictions informed. Barclays is in advanced discussions to
resolve this matter.
Claimed amounts/Financial impact
Barclays
does not expect the financial impact of the matters described above
to be material to the Group’s operating results, cash flows
or financial position.
Investigations into LIBOR and other benchmarks
Regulators
and law enforcement agencies, including certain competition
authorities, from a number of governments have been conducting
investigations relating to Barclays Bank PLC’s involvement in
manipulating certain financial benchmarks, such as LIBOR and
EURIBOR. Barclays PLC, Barclays Bank PLC and Barclays Capital Inc.
(BCI) have reached settlements with a number of regulators and law
enforcement agencies. Barclays Bank PLC continues to respond to
requests for information from the SFO in relation to its ongoing
LIBOR investigation, including in respect of Barclays Bank
PLC.
Claimed amounts/Financial impact
Aside
from the settlements described above, it is not currently
practicable to provide an estimate of any further financial impact
of the actions described on Barclays or what effect they might have
upon Barclays’ operating results, cash flows or financial
position in any particular period.
LIBOR and other benchmark civil actions
Various
individuals and corporates in a range of jurisdictions have
threatened or brought civil actions against Barclays and other
banks in relation to LIBOR and/or other benchmarks. While certain
cases have been dismissed, settled or settled subject to final
approval from the relevant court (and in the case of class actions,
the right of class members to opt out of the settlement and to seek
to file their own claims), other actions remain pending and their
ultimate impact is unclear.
USD LIBOR Cases in the Multidistrict Litigation Court
The
majority of the USD LIBOR cases, which have been filed in various
US jurisdictions, have been consolidated for pre-trial purposes
before a single judge in the US District Court in the Southern
District of New York (SDNY).
The
complaints are substantially similar and allege, amongst other
things, that Barclays PLC, Barclays Bank PLC, BCI and other
financial institutions individually and collectively violated
provisions of the US Sherman Antitrust Act (Antitrust Act), the US
Commodity Exchange Act (CEA), the US Racketeer Influenced and
Corrupt Organizations Act (RICO), the Securities Exchange Act of
1934 and various state laws by manipulating USD LIBOR
rates.
Certain
of the proposed class actions have been settled. Barclays has
settled claims purportedly brought on behalf of plaintiffs that (i)
engaged in USD LIBOR-linked over-the-counter transactions (OTC
Class); (ii) purchased USD LIBOR-linked financial instruments on an
exchange; (iii) purchased USD LIBOR-linked debt securities; or (iv)
issued loans linked to USD LIBOR (Lender Class) and paid $120m,
$20m, $7.1m and $4m respectively. The settlements with the OTC
Class and the Lender Class have received final court approval. The
other settlements remain subject to final court approval and/or the
right of class members to opt out of the settlement and to seek to
file their own claims.
The
remaining putative class actions and individual actions seek
unspecified damages with the exception of five lawsuits, in which
the plaintiffs are seeking a combined total in excess of $1.25bn in
actual damages against all defendants, including Barclays Bank PLC,
plus punitive damages. Some of the lawsuits also seek trebling of
damages under the Antitrust Act and RICO.
Additional USD LIBOR Cases in the SDNY
In
2015, an individual action against Barclays Bank PLC and other
panel bank defendants was dismissed by the SDNY. The plaintiff
alleged that the panel bank defendants conspired to increase USD
LIBOR, which caused the value of bonds pledged as collateral for a
loan to decrease, ultimately resulting in the sale of the bonds at
a low point in the market. In March 2018, the court denied the
plaintiff’s motion for leave to amend its complaint and
dismissed the case. The plaintiff’s appeal of the
court’s order has been dismissed.
Beginning
in January 2019, several putative class actions were filed in the
SDNY against Barclays PLC, Barclays Bank PLC, BCI, other financial
institution defendants and Intercontinental Exchange Inc. and
certain of its affiliates (ICE), asserting antitrust and unjust
enrichment claims on allegations that, beginning in 2014,
defendants manipulated USD LIBOR through defendants’
submissions to ICE, which took over rate-setting duties for LIBOR
from the British Bankers' Association in 2014. These actions have
been consolidated.
Sterling LIBOR Case in SDNY
In
2015, a putative class action was filed in the SDNY against
Barclays Bank PLC and other Sterling LIBOR panel banks by a
plaintiff involved in exchange-traded and over-the-counter
derivatives that were linked to Sterling LIBOR. The complaint
alleges, among other things, that the defendants manipulated the
Sterling LIBOR rate between 2005 and 2010 and, in so doing,
committed CEA, Antitrust Act, and RICO violations. In 2016, this
class action was consolidated with an additional putative class
action making similar allegations against Barclays Bank PLC and BCI
and other Sterling LIBOR panel banks. The defendants’ motion
to dismiss was granted in December 2018. The plaintiff has asked
the court to reconsider this decision.
Japanese Yen LIBOR Cases in SDNY
In
2012, a putative class action was filed in the SDNY against
Barclays Bank PLC and other Japanese Yen LIBOR panel banks by a
plaintiff involved in exchange-traded derivatives. The complaint
also names members of the Japanese Bankers Association’s
Euroyen Tokyo Interbank Offered Rate (Euroyen TIBOR) panel, of
which Barclays Bank PLC is not a member. The complaint alleges,
amongst other things, manipulation of the Euroyen TIBOR and Yen
LIBOR rates and breaches of the CEA and Antitrust Act between 2006
and 2010. In 2014, the court dismissed the plaintiff’s
antitrust claims in full, but the plaintiff’s CEA claims
remain pending. Discovery is ongoing.
In
2017, a second putative class action concerning Yen LIBOR which was
filed in the SDNY against Barclays PLC, Barclays Bank PLC and BCI
was dismissed in full. The complaint makes similar allegations to
the 2012 class action. The plaintiffs have appealed the
dismissal.
SIBOR/SOR Case in the SDNY
In
2016, a putative class action was filed in the SDNY against
Barclays PLC, Barclays Bank PLC, BCI and other defendants, alleging
manipulation of the Singapore Interbank Offered Rate (SIBOR) and
Singapore Swap Offer Rate (SOR). The plaintiffs amended their
complaint in 2017 following dismissal by the court of the claims
against Barclays for failure to state a claim. In October 2018, the
court dismissed all claims against Barclays PLC, Barclays Bank PLC
and BCI, a decision that the plaintiffs are
challenging.
Non-US Benchmarks Cases
In
addition to the US actions described above, legal proceedings have
been brought or threatened against Barclays in connection with
alleged manipulation of LIBOR and EURIBOR and other benchmarks in
the UK, including the matter referred to below in ‘Local
authority civil actions concerning LIBOR’ that is also
related to Barclays Bank UK PLC, as well as in a number of other
jurisdictions in Europe, Israel and Argentina. Additional
proceedings in other jurisdictions may be brought in the
future.
Claimed amounts/Financial impact
Aside
from the settlements described above, it is not currently
practicable to provide an estimate of any further financial impact
of the actions described on Barclays or what effect they might have
upon Barclays’ operating results, cash flows or financial
position in any particular period.
Foreign Exchange Investigations
Various
regulatory and enforcement authorities across multiple
jurisdictions have been investigating a range of issues associated
with Foreign Exchange sales and trading, including electronic
trading.
In 2015
Barclays reached settlements with the CFTC, the DoJ, the NYDFS, the
Board of Governors of the Federal Reserve System (Federal Reserve)
and the FCA (together, the 2015 Resolving Authorities) in relation
to investigations into certain sales and trading practices in the
Foreign Exchange market. In connection with these settlements,
Barclays paid total penalties of approximately $2.38bn and agreed
to undertake certain remedial actions. Under the plea agreement
with the DoJ, which was approved by the US District Court for the
District of Connecticut in January 2017, Barclays PLC agreed to a
term of probation of three years. Barclays also continues to
provide relevant information to certain of the 2015 Resolving
Authorities.
The
European Commission is one of a number of authorities still
conducting an investigation into certain trading practices in
Foreign Exchange markets. In May 2019, the European Commission
announced two settlements and Barclays has paid total penalties of
approximately €210m. In June 2019, the Swiss Competition
Commission announced two settlements, which require Barclays to pay
total penalties of approximately CHF 27m.
Claimed amounts/Financial impact
Aside
from the settlements described above, Barclays does not expect the
financial impact of the matters described above to be material to
the Group’s operating results, cash flows or financial
position.
Civil actions in respect of Foreign Exchange
Following
settlement of certain investigations referred to above in
‘Foreign Exchange Investigations’ a number of
individuals and corporates in a range of jurisdictions have
threatened or brought civil actions against Barclays and other
banks in relation to Foreign Exchange or may do so in the future.
Certain of these cases have been dismissed, settled or settled
subject to final approval from the relevant court (and in the case
of class actions, the right of class members to opt out of the
settlement and to seek to file their own claims).
FX Opt Out Action
In
2014, a number of civil actions filed in the SDNY alleging
manipulation of Foreign Exchange markets were combined into a
single consolidated action (Consolidated FX Action). In
2015, Barclays Bank PLC and BCI
settled the Consolidated FX Action and paid $384m. The settlement
received final court approval in August 2018. In November 2018, a
group of sixteen plaintiffs (and several of their affiliates) who
opted out of the Consolidated FX Action settlement filed a
complaint in the SDNY against the Consolidated FX Action
defendants, including Barclays Bank PLC and BCI.
Retail Basis Action
A
putative action was filed in the Northern District of California
(and subsequently transferred to the SDNY) against several
international banks, including Barclays PLC and BCI, on behalf of a
putative class of individuals that exchanged currencies on a retail
basis at bank branches (Retail Basis Claims). The Court has ruled
that the Retail Basis Claims are not covered by the settlement
agreement in the Consolidated FX Action. The Court subsequently
dismissed all Retail Basis Claims against Barclays and all other
defendants. The plaintiffs amended their complaint and sought to
expand the action to include credit card, debit card and wire
transactions, which expansion the Court denied.
State Law FX Action
In
2016, a putative class action was filed in the SDNY under federal,
New York and California law on behalf of proposed classes of
stockholders of Exchange Traded Funds and others who supposedly
were indirect investors in FX Instruments. The plaintiffs’
counsel subsequently amended the complaint to bring claims on
behalf of a proposed class of investors under federal and various
state laws who traded FX Instruments through FX dealers or brokers
not alleged to have manipulated Foreign Exchange Rates. A different
group of plaintiffs subsequently filed another action and asserted
substantively similar claims. These two actions were consolidated
and a consolidated complaint was filed in 2017. The consolidated
action was dismissed, but the plaintiffs have filed an amended
complaint, except as to their federal claims.
Non-US FX Actions
In
addition to the actions described above, legal proceedings have
been brought or are threatened against Barclays in connection with
manipulation of Foreign Exchange in the UK, a number of other
jurisdictions in Europe, Israel and Australia and additional
proceedings may be brought in the future.
Claimed amounts/Financial impact
Aside
from the settlement described above, it is not currently
practicable to provide an estimate of any further financial impact
of the actions described on Barclays or what effect they might have
upon Barclays’ operating results, cash flows or financial
position in any particular period.
Metals investigations
Barclays
Bank PLC has provided information to the DoJ, the CFTC and other
authorities in connection with investigations into metals and
metals-based financial instruments.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on Barclays or what effect they
might have upon Barclays’ operating results, cash flows or
financial position in any particular period.
Civil actions in respect of the gold and silver fix
A
number of civil complaints, each on behalf of a proposed class of
plaintiffs, have been consolidated and transferred to the SDNY. The
complaints allege that Barclays Bank PLC and other members of The
London Gold Market Fixing Ltd. manipulated the prices of gold and
gold derivative contracts in violation of the CEA, the Antitrust
Act, and state antitrust and consumer protection laws.
Also,
in the US, a proposed class of plaintiffs filed a complaint against
a number of banks, including Barclays Bank PLC, BCI and Barclays
Capital Services Ltd., alleging manipulation of the price of silver
in violation of the CEA and antitrust laws. The court has dismissed
this action as against the Barclays entities.
Civil
actions have also been filed in Canadian courts against Barclays
PLC, Barclays Bank PLC, Barclays Capital Canada Inc. and BCI on
behalf of proposed classes of plaintiffs alleging manipulation of
gold and silver prices in violation of Canadian law.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on Barclays or what effect they
might have upon Barclays’ operating results, cash flows or
financial position in any particular period.
US residential mortgage related litigation
There
are various pending civil actions relating to US Residential
Mortgage-Backed Securities (RMBS). Barclays was the sole provider
of various loan-level representations and warranties (R&Ws)
with respect to approximately $5bn of Barclays sponsored
securitisations. In addition, an entity that Barclays acquired in
2007 (Acquired Subsidiary) provided R&Ws on $19.4bn of loans it
sold to third parties. There are no stated expiration provisions
applicable to most R&Ws made by Barclays or the Acquired
Subsidiary. Under certain circumstances, Barclays and/or the
Acquired Subsidiary may be required to repurchase the related loans
or make other payments related to such loans if the R&Ws are
breached.
The
unresolved repurchase requests received on or before 30 June 2019
associated with R&Ws made by Barclays or the Acquired
Subsidiary had an original unpaid principal balance of
approximately $2.1bn at the time of such sale.
The
unresolved repurchase requests described above relate to civil
actions that have been commenced by the trustees for certain RMBS
securitisations in which the trustees allege that Barclays and/or
the Acquired Subsidiary must repurchase loans that violated the
operative R&Ws. Such trustees making repurchase requests have
also alleged that the operative R&Ws may have been violated
with respect to a greater (but unspecified) amount of loans than
the amount of loans previously stated in specific repurchase
requests made by such trustees. These civil actions are ongoing. An
intermediate appellate court has found that claims related to
certain R&Ws are time-barred. This decision is being
appealed.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of any further
financial impact of the actions described on Barclays or what
effect they might have upon Barclays’ operating results, cash
flows or financial position in any particular period.
Alternative trading systems
In
2014, the New York State Attorney General (NYAG) filed a complaint
(NYAG Complaint) against Barclays PLC and BCI in the Supreme Court
of the State of New York alleging, amongst other things, that
Barclays PLC and BCI engaged in fraud and deceptive practices in
connection with LX, Barclays’ SEC-registered alternative
trading system (ATS). In February 2016, Barclays reached settlement
agreements with the SEC and NYAG, which required Barclays to pay
$35m to each. Following the filing of the NYAG Complaint, Barclays
PLC and BCI were also named in a putative shareholder securities
class action. The parties have agreed to a settlement of this
action for $27m, which has received final court
approval.
Claimed amounts/Financial impact
Aside
from the settlements described above, there is no financial impact
on Barclays’ operating results, cash flows or financial
position.
Treasury auction securities civil actions and related
matters
Various
civil actions have been filed against Barclays Bank PLC, BCI and
other financial institutions alleging violations of antitrust and
other laws relating to the markets for US Treasury securities and
Supranational, Sovereign and Agency securities. Certain
governmental authorities are also conducting investigations
relating to trading of certain government and agency securities in
various markets.
Numerous
putative class action complaints have been filed in US Federal
Court against Barclays Bank PLC, BCI and other financial
institutions that have served as primary dealers in US Treasury
securities. Those actions have been consolidated and in 2017,
plaintiffs in the putative class action filed a consolidated
amended complaint in the US Federal Court in New York against the
defendants as well as certain corporations that operate electronic
trading platforms on which US Treasury securities are traded. The
complaint purports to assert claims under US federal antitrust laws
and state common law based on allegations that the defendants (i)
conspired to manipulate the US Treasury securities market and/or
(ii) conspired to prevent the creation of certain platforms by
boycotting or threatening to boycott such trading platforms. The
defendants have filed a motion to dismiss.
In
addition, certain plaintiffs have filed a related, direct action
against BCI and certain other financial institutions that have
served as primary dealers in US Treasury securities. This complaint
alleges that defendants conspired to fix and manipulate the US
Treasury securities market in violation of US federal antitrust
laws, the CEA and state common law.
Barclays
PLC, Barclays Bank PLC, BCI, Barclays Execution Services Limited
(formerly Barclays Services Limited), Barclays Capital Securities
Limited and certain other financial institutions have been named as
defendants in a civil antitrust complaint that alleges that the
defendants engaged in a conspiracy to fix prices and restrain
competition in the market for US dollar-denominated Supranational,
Sovereign and Agency bonds (SSA Bonds) from 2009 through 2015. The
defendants have moved to dismiss the action. In February 2019,
indirect purchasers of SSA Bonds filed a separate but related
complaint making similar allegations.
Certain
governmental authorities are conducting investigations into
activities relating to the trading of certain government and agency
securities in various markets and Barclays has been providing
information to various authorities on an ongoing
basis.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on Barclays or what effect they
might have upon Barclays’ operating results, cash flows or
financial position in any particular period.
US Government Sponsored Entities Bond Civil Class
Action
In a
putative consolidated class action filed in the SDNY in 2019,
plaintiffs allege that BCI and certain other bond dealers conspired
to fix the prices of government sponsored entity bonds in violation
of US antitrust law from January 2009 through January
2016.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the matter described on Barclays or what effect it might
have upon Barclays’ operating results, cash flows or
financial position in any particular period.
Mexican Government Bond civil action
In
2018, a putative consolidated class action against various
financial institutions including Barclays PLC, Barclays Bank PLC,
BCI, Barclays Capital Securities Limited, Barclays Bank Mexico,
S.A., Grupo Financiero Barclays Mexico, S.A. de C.V. and Banco
Barclays S.A. was consolidated in the US District Court in the
SDNY. The plaintiffs assert antitrust and state law claims arising
out of an alleged conspiracy to fix the prices of Mexican
Government Bonds from 2006 through mid-2017. Defendants have moved
to dismiss the consolidated action.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on Barclays or what effect they
might have upon Barclays’ operating results, cash flows or
financial position in any particular period.
BDC Finance L.L.C.
In
2008, BDC Finance L.L.C. (BDC) filed a complaint in the NY Supreme
Court alleging that Barclays Bank PLC had breached a contract in
connection with a portfolio of total return swaps governed by an
ISDA Master Agreement (collectively, the Agreement) when it failed
to transfer approximately $40m of alleged excess collateral in
response to BDC’s 2008 demand (Demand).
BDC
asserts that under the Agreement Barclays Bank PLC was not entitled
to dispute the Demand before transferring the alleged excess
collateral and that even if the Agreement entitled Barclays Bank
PLC to dispute the Demand before making the transfer, Barclays Bank
PLC failed to dispute the Demand. BDC demands damages totalling
$298m plus attorneys’ fees, expenses, and pre-judgement
interest. Following a trial on certain liability issues, the court
ruled in December 2018 that Barclays Bank PLC was not a defaulting
party. BDC has appealed that decision.
In
2011, BDC’s investment advisor, BDCM Fund Adviser, L.L.C. and
its parent company, Black Diamond Capital Holdings, L.L.C. also
sued Barclays Bank PLC and BCI in Connecticut State Court for
unspecified damages allegedly resulting from Barclays Bank
PLC’s conduct relating to the Agreement, asserting claims for
violation of the Connecticut Unfair Trade Practices Act and
tortious interference with business and prospective business
relations. The Connecticut case is currently stayed.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on Barclays or what effect they
might have upon Barclays’ operating results, cash flows or
financial position in any particular period. BDC has made claims
against Barclays totalling $298m plus attorneys’ fees,
expenses, and pre-judgement interest. This amount does not
necessarily reflect Barclays’ potential financial exposure if
a ruling were to be made against it.
Civil actions in respect of the US Anti-Terrorism Act
Civil
complaints against Barclays Bank PLC and other banks allege
engagement in a conspiracy and violation of the US Anti-Terrorism
Act (ATA). These include various civil complaints filed in the US
Federal Courts in the EDNY and SDNY by separate groups of
plaintiffs (aggregating over 4,000) alleging that Barclays Bank PLC
and a number of other banks engaged in a conspiracy and violated
the ATA by facilitating US dollar denominated transactions for the
Government of Iran and various Iranian banks, which in turn funded
acts of terrorism that injured or killed the plaintiffs’
family members. The plaintiffs seek to recover for pain, suffering
and mental anguish pursuant to the provisions of the ATA, which
allows for the tripling of any proven damages and attorneys' fees.
In respect of a motion by defendants to dismiss one of the
complaints, in July 2018, a magistrate judge (to whom the court
referred the motion) issued a recommendation that the motion be
denied; the defendants objected to that recommendation; and the
motion is pending before the court. In respect of another
complaint, the defendants’ motion to dismiss was granted in
March 2019, but the plaintiffs have moved to file an amended
complaint.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on Barclays or what effect they
might have upon Barclays’ operating results, cash flows or
financial position in any particular period.
Interest rate swap and credit default swap US civil
actions
Barclays
PLC, Barclays Bank PLC, and BCI, together with other financial
institutions that act as market makers for interest rate swaps
(IRS) are named as defendants in several antitrust class actions
which were consolidated in the SDNY in 2016. The complaints allege
the defendants conspired to prevent the development of exchanges
for IRS and demand unspecified money damages, treble damages and
legal fees. Plaintiffs include certain swap execution facilities,
as well as buy-side investors. The buy-side investors claim to
represent a class that transacted in fixed-for-floating IRS with
defendants in the US from 2008 to the present, including, for
example, US retirement and pension funds, municipalities,
university endowments, corporations, insurance companies and
investment funds.
In
2017, a separate suit was filed in the US District Court in the
SDNY against the same financial institution defendants in the IRS
cases, including Barclays PLC, Barclays Bank PLC, and BCI, claiming
that certain conduct alleged in the IRS cases also caused plaintiff
to suffer harm with respect to the Credit Default Swaps market. The
defendants have moved to dismiss this action. Separately, in June
2018, trueEX LLC filed an antitrust class action in the SDNY
against eleven financial institutions that act as dealers in the
IRS market, including Barclays Bank PLC and BCI, alleging that the
defendants unlawfully conspired to block trueEX from successfully
entering the market with its IRS trading platform. trueEX LLC also
alleges that the defendants more generally boycotted other
anonymous, all-to-all IRS trading platforms. In November 2018, the
court dismissed certain claims for unjust enrichment and tortious
interference, but denied a motion to dismiss the federal and state
antitrust claims which remain pending.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on Barclays or what effect they
might have upon Barclays’ operating results, cash flows or
financial position in any particular period.
Portuguese Competition Authority investigation
The
Portuguese Competition Authority is investigating whether
competition law was infringed by the exchange of information about
retail credit products amongst 15 banks in Portugal, including
Barclays, over a period of 11 years with particular reference to
mortgages, consumer lending and lending to small and medium
enterprises. Barclays is cooperating with the
investigation.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the matter described on Barclays or what effect it might
have upon Barclays’ operating results, cash flows or
financial position in any particular period.
2.
Barclays
PLC, Barclays Bank PLC and Barclays Bank UK PLC
Investigation into collections and recoveries relating to unsecured
lending
In
February 2018, the FCA commenced an enforcement investigation in
relation to whether or not Barclays implemented effective systems
and controls with respect to collections and recoveries and whether
or not it paid due consideration to the interests of customers
in default and arrears.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of the financial
impact of the investigation on Barclays or what effect that it
might have upon Barclays’ operating results, cash flows or
financial position in any particular period.
HM Revenue & Customs (HMRC) assessments concerning UK Value
Added Tax
In
2018, HMRC issued notices that have the effect of removing certain
overseas subsidiaries that have operations in the UK from
Barclays’ UK VAT group, in which group supplies between
members are generally free from VAT. The notices have retrospective
effect and correspond to assessments of £181m (inclusive of
interest), of which Barclays would expect to attribute an amount of
approximately £128m to Barclays Bank UK PLC and £53m to
Barclays Bank PLC. Barclays has appealed HMRC’s decision to
the First Tier Tribunal (Tax Chamber).
Claimed amounts/Financial impact
The
total amount of the HMRC assessments is approximately £181m,
inclusive of interest.
Local authority civil actions concerning LIBOR
Following
settlement by Barclays Bank PLC of various
governmental investigations concerning certain benchmark
interest rate submissions referred to above in
‘Investigations into LIBOR and other benchmarks’, in
the UK, certain local authorities have brought claims against
Barclays asserting that they entered into loans in reliance on
misrepresentations made by Barclays in respect of its conduct in
relation to LIBOR.
Claimed amounts/Financial impact
It is
not currently practicable to provide an estimate of any further
financial impact of the actions described on Barclays or what
effect they might have upon Barclays’ operating results, cash
flows or financial position in any particular period.
General
Barclays
is engaged in various other legal, competition and regulatory
matters in the UK, the US and a number of other overseas
jurisdictions. It is subject to legal proceedings brought by and
against Barclays which arise in the ordinary course of business
from time to time, including (but not limited to) disputes in
relation to contracts, securities, debt collection, consumer
credit, fraud, trusts, client assets, competition, data management
and protection, money laundering, financial crime, employment,
environmental and other statutory and common law
issues.
Barclays
is also subject to enquiries and examinations, requests for
information, audits, investigations and legal and other proceedings
by regulators, governmental and other public bodies in connection
with (but not limited to) consumer protection measures, compliance
with legislation and regulation, wholesale trading activity and
other areas of banking and business activities in which Barclays is
or has been engaged. Barclays is cooperating with the relevant
authorities and keeping all relevant agencies briefed as
appropriate in relation to these matters and others described in
this note on an ongoing basis.
At the
present time, Barclays does not expect the ultimate resolution of
any of these other matters to have a material adverse effect on its
financial position. However, in light of the uncertainties involved
in such matters and the matters specifically described in this
note, there can be no assurance that the outcome of a
particular matter or matters (including formerly active matters or
those matters arising after the date of this note) will not be
material to Barclays’ results, operations or cash flow for a
particular period, depending on, amongst other things, the amount
of the loss resulting from the matter(s) and the amount of profit
otherwise reported for the reporting period.
20.
Related party transactions
Related
party transactions in the half year ended 30 June 2019 were similar
in nature to those disclosed in the Barclays PLC Annual Report
2018. No related party transactions that have taken place in the
half year ended 30 June 2019 have materially affected the financial
position or the performance of the Barclays Group during this
period.
21.
Barclays PLC parent company balance sheet
|
As at
|
As at
|
|
30.06.19
|
31.12.18
|
Assets
|
£m
|
£m
|
Investment in subsidiaries
|
60,902
|
57,374
|
Loans and advances to subsidiaries
|
29,800
|
29,374
|
Financial assets at fair value through the income
statement
|
10,774
|
6,945
|
Derivative financial instruments
|
138
|
168
|
Other assets
|
109
|
115
|
Total assets
|
101,723
|
93,976
|
|
|
|
Liabilities
|
|
|
Deposits at amortised cost
|
519
|
576
|
Debt securities in issue
|
32,489
|
32,373
|
Subordinated liabilities
|
7,976
|
6,775
|
Financial liabilities designated at fair value
|
3,514
|
-
|
Other liabilities
|
99
|
72
|
Total liabilities
|
44,597
|
39,796
|
|
|
|
Equity
|
|
|
Called up share capital
|
4,311
|
4,283
|
Share premium account
|
183
|
28
|
Other equity instruments
|
12,137
|
9,633
|
Other reserves
|
394
|
394
|
Retained earnings
|
40,101
|
39,842
|
Total equity
|
57,126
|
54,180
|
|
|
|
Total liabilities and equity
|
101,723
|
93,976
|
Investment in subsidiaries
The
investment in subsidiaries of £60,902m (December 2018:
£57,374m) predominantly relates to investments in Barclays
Bank PLC and Barclays Bank UK PLC, as well as holdings of their AT1
securities of £12,200m (December 2018: £9,666m). The
increase of £3,528m during the period was predominantly driven
by capital contributions into Barclays Bank PLC totalling
£995m and additional AT1 holdings of $2,000m and
£1,000m.
Financial assets and liabilities designated at fair
value
Financial
liabilities designated at fair value of £3,514m (December
2018: £nil) comprises issuances during the period totalling
$2,750m Fixed-to-Floating Rate Senior Notes, £600m Fixed Rate
Senior Notes, AUD940m Fixed and Floating Rate Senior Notes and
¥20,000m Fixed-to-Floating Rate Bonds. The proceeds raised
through these transactions were used to invest in subsidiaries of
Barclays PLC which are included within the financial assets
designated at fair value through the income statement balance of
£10,774m (December 2018: £6,945m).
Subordinated liabilities
During
H119, Barclays PLC issued $1,500m of Fixed-to-Floating Rate
Subordinated Notes, which are included within the subordinated
liabilities balance of £7,976m (December 2018:
£6,775m).
Other equity instruments
Other
equity instruments comprises AT1 securities issued by Barclays PLC.
There have been two issuances during the period, with principal
amounts totalling $2,000m and £1,000m.
Management of internal investments, loans and advances
Barclays
PLC retains the discretion to manage the nature of its internal
investments in subsidiaries according to their regulatory and
business needs. Barclays PLC may invest capital and funding into
Barclays Bank PLC, Barclays Bank UK PLC and other Barclays Group
subsidiaries such as the Group Service Company and the US
Intermediate Holding Company (IHC).
Appendix: Non-IFRS Performance Measures
Barclays
management believes that the non-IFRS performance measures included
in this document provide valuable information to the readers of the
financial statements as they enable the reader to identify a more
consistent basis for comparing the businesses’ performance
between financial periods, and provide more detail concerning the
elements of performance which the managers of these businesses are
most directly able to influence or are relevant for an assessment
of the Barclays Group. They also reflect an important aspect of the
way in which operating targets are defined and performance is
monitored by Barclays management.
However,
any non-IFRS performance measures in this document are not a
substitute for IFRS measures and readers should consider the IFRS
measures as well.
Non-IFRS performance measures glossary
Measure
|
Definition
|
Loan:
deposit ratio
|
Loans
and advances at amortised cost divided by deposits at amortised
cost.
|
Period
end allocated tangible equity
|
Allocated
tangible equity is calculated as 13.0% (2018: 13.0%) of RWAs for
each business, adjusted for capital deductions, excluding goodwill
and intangible assets, reflecting the assumptions the Barclays
Group uses for capital planning purposes. Head Office allocated
tangible equity represents the difference between the Barclays
Group’s tangible shareholders’ equity and the amounts
allocated to businesses.
|
Average
tangible shareholders’ equity
|
Calculated
as the average of the previous month’s period end tangible
equity and the current month’s period end tangible equity.
The average tangible shareholders’ equity for the period is
the average of the monthly averages within that
period.
|
Average
allocated tangible equity
|
Calculated
as the average of the previous month’s period end allocated
tangible equity and the current month’s period end allocated
tangible equity. The average allocated tangible equity for the
period is the average of the monthly averages within that
period.
|
Return
on average tangible shareholders’ equity
|
Annualised
profit after tax attributable to ordinary equity holders of the
parent, as a proportion of average shareholders’ equity
excluding non-controlling interests and other equity instruments
adjusted for the deduction of intangible assets and goodwill. The
components of the calculation have been included on page
85.
|
Return
on average allocated tangible equity
|
Annualised
profit after tax attributable to ordinary equity holders of the
parent, as a proportion of average allocated tangible equity. The
components of the calculation have been included on page
85.
|
Cost:
income ratio
|
Total
operating expenses divided by total income.
|
Loan
loss rate
|
Quoted
in basis points and represents total annualised impairment charges
divided by gross loans and advances held at amortised cost at the
balance sheet date. The components of the calculation have been
included on page 24.
|
Net
interest margin
|
Annualised
net interest income divided by the sum of average customer assets.
The components of the calculation have been included on page
22.
|
Tangible
net asset value per share
|
Calculated
by dividing shareholders’ equity, excluding non-controlling
interests and other equity instruments, less goodwill and
intangible assets, by the number of issued ordinary shares. The
components of the calculation have been included on page
93.
|
Performance
measures excluding litigation and conduct
|
Calculated
by excluding litigation and conduct charges from performance
measures. The components of the calculations have been included on
pages 86 to 93.
|
Returns
Return
on average tangible equity is calculated as profit after tax
attributable to ordinary equity holders of the parent as a
proportion of average tangible equity, excluding non-controlling
and other equity interests for businesses. Allocated tangible
equity has been calculated as 13.0% (2018: 13.0%) of RWAs for each
business, adjusted for capital deductions, excluding goodwill and
intangible assets, reflecting the assumptions the Barclays Group
uses for capital planning purposes. Head Office average allocated
tangible equity represents the difference between the Barclays
Group’s average tangible shareholders’ equity and the
amounts allocated to businesses.
|
Profit/(loss) attributable to ordinary equity holders of the
parent
|
|
Average tangible equity
|
|
Return on average tangible equity
|
Half year ended 30.06.19
|
£m
|
|
£bn
|
|
%
|
Barclays UK
|
750
|
|
10.3
|
|
14.5
|
Corporate and Investment Bank
|
1,178
|
|
25.5
|
|
9.3
|
Consumer, Cards and Payments
|
442
|
|
5.3
|
|
16.6
|
Barclays International
|
1,620
|
|
30.8
|
|
10.5
|
Head Office
|
(298)
|
|
4.6
|
|
n/m
|
Barclays Group
|
2,072
|
|
45.7
|
|
9.1
|
|
|
|
|
|
|
Half year ended 30.06.18
|
|
|
|
|
|
Barclays UK
|
447
|
|
10.0
|
|
9.0
|
Corporate and Investment Bank
|
1,434
|
|
26.0
|
|
11.0
|
Consumer, Cards and Payments
|
499
|
|
4.7
|
|
21.2
|
Barclays International
|
1,933
|
|
30.7
|
|
12.6
|
Head Office
|
(1,819)
|
|
3.1
|
|
n/m
|
Barclays Group
|
561
|
|
43.8
|
|
2.6
|
Performance measures excluding litigation and conduct
|
|
|
|
|
|
|
|
|
Half year ended 30.06.19
|
|
Barclays UK
|
Corporate and Investment Bank
|
Consumer, Cards and Payments
|
Barclays International
|
Head Office
|
Barclays Group
|
Cost: income ratio
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Total operating expenses
|
(2,065)
|
(3,505)
|
(1,166)
|
(4,671)
|
(136)
|
(6,872)
|
Impact of litigation and conduct
|
44
|
26
|
4
|
30
|
40
|
114
|
Operating expenses
|
(2,021)
|
(3,479)
|
(1,162)
|
(4,641)
|
(96)
|
(6,758)
|
|
|
|
|
|
|
|
Total income
|
3,548
|
5,300
|
2,173
|
7,473
|
(231)
|
10,790
|
|
|
|
|
|
|
|
Cost: income ratio excluding litigation and conduct
|
57%
|
66%
|
53%
|
62%
|
n/m
|
63%
|
|
|
|
|
|
|
|
Profit before tax
|
|
|
|
|
|
|
Profit/(loss) before tax
|
1,062
|
1,714
|
627
|
2,341
|
(389)
|
3,014
|
Impact of litigation and conduct
|
44
|
26
|
4
|
30
|
40
|
114
|
Profit/(loss) before tax excluding litigation and
conduct
|
1,106
|
1,740
|
631
|
2,371
|
(349)
|
3,128
|
|
|
|
|
|
|
|
Profit attributable to ordinary equity holders of the
parent
|
|
|
|
|
|
|
Attributable profit/(loss)
|
750
|
1,178
|
442
|
1,620
|
(298)
|
2,072
|
Post-tax impact of litigation and conduct
|
32
|
21
|
3
|
24
|
30
|
86
|
Profit/(loss) attributable to ordinary equity holders of the parent
excluding litigation and conduct
|
782
|
1,199
|
445
|
1,644
|
(268)
|
2,158
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Average shareholders' equity
|
13.9
|
25.5
|
6.4
|
31.9
|
7.9
|
53.7
|
Average goodwill and intangibles
|
(3.6)
|
-
|
(1.1)
|
(1.1)
|
(3.3)
|
(8.0)
|
Average tangible shareholders' equity
|
10.3
|
25.5
|
5.3
|
30.8
|
4.6
|
45.7
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity excluding
litigation and conduct
|
15.1%
|
9.4%
|
16.7%
|
10.7%
|
n/m
|
9.4%
|
|
|
|
|
|
|
|
Basic earnings per ordinary share
|
|
|
|
|
|
|
Basic weighted average number of shares (m)
|
|
|
|
|
|
17,178
|
|
|
|
|
|
|
|
Basic earnings per ordinary share excluding litigation and
conduct
|
|
|
|
|
|
12.6p
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Half year 30.06.18
|
|
Barclays UK
|
Corporate and Investment Bank
|
Consumer, Cards and Payments
|
Barclays International
|
Head Office
|
Barclays Group
|
Cost: income ratio
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Total operating expenses
|
(2,387)
|
(3,559)
|
(1,109)
|
(4,668)
|
(1,661)
|
(8,716)
|
Impact of litigation and conduct
|
414
|
13
|
49
|
62
|
1,566
|
2,042
|
Operating expenses
|
(1,973)
|
(3,546)
|
(1,060)
|
(4,606)
|
(95)
|
(6,674)
|
|
|
|
|
|
|
|
Total income
|
3,624
|
5,379
|
2,136
|
7,515
|
(205)
|
10,934
|
|
|
|
|
|
|
|
Cost: income ratio excluding litigation and conduct
|
54%
|
66%
|
50%
|
61%
|
n/m
|
61%
|
|
|
|
|
|
|
|
Profit before tax
|
|
|
|
|
|
|
Profit/(loss) before tax
|
826
|
2,010
|
700
|
2,710
|
(1,877)
|
1,659
|
Impact of litigation and conduct
|
414
|
13
|
49
|
62
|
1,566
|
2,042
|
Profit/(loss) before tax excluding litigation and
conduct
|
1,240
|
2,023
|
749
|
2,772
|
(311)
|
3,701
|
|
|
|
|
|
|
|
Profit attributable to ordinary equity holders of the
parent
|
|
|
|
|
|
|
Attributable profit/(loss)
|
447
|
1,434
|
499
|
1,933
|
(1,819)
|
561
|
Post-tax impact of litigation and conduct
|
412
|
10
|
36
|
46
|
1,531
|
1,989
|
Profit/(loss) attributable to ordinary equity holders of the parent
excluding litigation and conduct
|
859
|
1,444
|
535
|
1,979
|
(288)
|
2,550
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Average shareholders' equity
|
13.5
|
26.3
|
5.8
|
32.1
|
6.1
|
51.7
|
Average goodwill and intangibles
|
(3.5)
|
(0.3)
|
(1.1)
|
(1.4)
|
(2.9)
|
(7.8)
|
Average tangible shareholders' equity
|
10.0
|
26.0
|
4.7
|
30.7
|
3.1
|
43.8
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity excluding
litigation and conduct
|
17.3%
|
11.1%
|
22.7%
|
12.9%
|
n/m
|
11.6%
|
|
|
|
|
|
|
|
Basic earnings per ordinary share
|
|
|
|
|
|
|
Basic weighted average number of shares (m)
|
|
|
|
|
|
17,067
|
|
|
|
|
|
|
|
Basic earnings per ordinary share excluding litigation and
conduct
|
|
|
|
|
|
14.9p
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barclays Group
|
|
|
|
|
|
|
|
|
|
|
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Cost: income ratio
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Total operating expenses
|
(3,554)
|
(3,318)
|
|
(4,093)
|
(3,434)
|
(3,391)
|
(5,325)
|
|
(4,369)
|
(3,355)
|
Impact of litigation and conduct
|
53
|
61
|
|
60
|
105
|
81
|
1,961
|
|
383
|
81
|
Operating expenses
|
(3,501)
|
(3,257)
|
|
(4,033)
|
(3,329)
|
(3,310)
|
(3,364)
|
|
(3,986)
|
(3,274)
|
|
|
|
|
|
|
|
|
|
|
|
Total income
|
5,538
|
5,252
|
|
5,073
|
5,129
|
5,576
|
5,358
|
|
5,022
|
5,173
|
|
|
|
|
|
|
|
|
|
|
|
Cost: income ratio excluding litigation and conduct
|
63%
|
62%
|
|
79%
|
65%
|
59%
|
63%
|
|
79%
|
63%
|
|
|
|
|
|
|
|
|
|
|
|
Profit before tax
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) before tax
|
1,531
|
1,483
|
|
374
|
1,461
|
1,895
|
(236)
|
|
93
|
1,107
|
Impact of litigation and conduct
|
53
|
61
|
|
60
|
105
|
81
|
1,961
|
|
383
|
81
|
Profit before tax excluding litigation and conduct
|
1,584
|
1,544
|
|
434
|
1,566
|
1,976
|
1,725
|
|
476
|
1,188
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable to ordinary equity holders of the
parent
|
|
|
|
|
|
|
|
|
|
|
Attributable profit/(loss)
|
1,034
|
1,038
|
|
(14)
|
1,050
|
1,279
|
(718)
|
|
(1,245)
|
626
|
Post-tax impact of litigation and conduct
|
40
|
46
|
|
62
|
85
|
59
|
1,930
|
|
351
|
77
|
Profit/(loss) attributable to ordinary equity holders of the parent
excluding litigation and conduct
|
1,074
|
1,084
|
|
48
|
1,135
|
1,338
|
1,212
|
|
(894)
|
703
|
|
|
|
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Average shareholders' equity
|
54.0
|
53.2
|
|
52.2
|
52.5
|
51.3
|
52.0
|
|
55.9
|
56.6
|
Average goodwill and intangibles
|
(7.8)
|
(8.0)
|
|
(7.9)
|
(7.9)
|
(7.8)
|
(7.8)
|
|
(7.8)
|
(7.8)
|
Average tangible shareholders' equity
|
46.2
|
45.2
|
|
44.3
|
44.6
|
43.5
|
44.2
|
|
48.1
|
48.9
|
|
|
|
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity excluding
litigation and conduct
|
9.3%
|
9.6%
|
|
0.4%
|
10.2%
|
12.3%
|
11.0%
|
|
(7.4%)
|
5.7%
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per ordinary share
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average number of shares (m)
|
17,178
|
17,111
|
|
17,075
|
17,074
|
17,067
|
17,037
|
|
16,996
|
16,994
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings/(loss) per ordinary share excluding litigation and
conduct
|
6.3p
|
6.3p
|
|
0.3p
|
6.6p
|
7.8p
|
7.1p
|
|
(5.3p)
|
4.1p
|
|
|
|
|
|
|
|
|
|
|
|
Barclays UK
|
|
|
|
|
|
|
|
|
|
|
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Cost: income ratio
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Total operating expenses
|
(1,063)
|
(1,002)
|
|
(1,175)
|
(1,042)
|
(971)
|
(1,416)
|
|
(1,229)
|
(991)
|
Impact of litigation and conduct
|
41
|
3
|
|
15
|
54
|
3
|
411
|
|
53
|
11
|
Operating expenses
|
(1,022)
|
(999)
|
|
(1,160)
|
(988)
|
(968)
|
(1,005)
|
|
(1,176)
|
(980)
|
|
|
|
|
|
|
|
|
|
|
|
Total income
|
1,771
|
1,777
|
|
1,863
|
1,896
|
1,836
|
1,788
|
|
1,870
|
1,852
|
|
|
|
|
|
|
|
|
|
|
|
Cost: income ratio excluding litigation and conduct
|
58%
|
56%
|
|
62%
|
52%
|
53%
|
56%
|
|
63%
|
53%
|
|
|
|
|
|
|
|
|
|
|
|
Profit before tax
|
|
|
|
|
|
|
|
|
|
|
Profit before tax
|
477
|
585
|
|
390
|
740
|
656
|
170
|
|
452
|
661
|
Impact of litigation and conduct
|
41
|
3
|
|
15
|
54
|
3
|
411
|
|
53
|
11
|
Profit before tax excluding litigation and conduct
|
518
|
588
|
|
405
|
794
|
659
|
581
|
|
505
|
672
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable to ordinary equity holders of the
parent
|
|
|
|
|
|
|
|
|
|
|
Attributable profit/(loss)
|
328
|
422
|
|
241
|
510
|
473
|
(26)
|
|
258
|
432
|
Post-tax impact of litigation and conduct
|
30
|
2
|
|
12
|
48
|
1
|
411
|
|
37
|
8
|
Profit attributable to ordinary equity holders of the parent
excluding litigation and conduct
|
358
|
424
|
|
253
|
558
|
474
|
385
|
|
295
|
440
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Average allocated equity
|
13.8
|
13.9
|
|
13.6
|
13.7
|
13.6
|
13.4
|
|
13.1
|
14.0
|
Average goodwill and intangibles
|
(3.5)
|
(3.5)
|
|
(3.5)
|
(3.6)
|
(3.5)
|
(3.5)
|
|
(3.5)
|
(4.6)
|
Average allocated tangible equity
|
10.3
|
10.4
|
|
10.1
|
10.1
|
10.1
|
9.8
|
|
9.6
|
9.4
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity excluding litigation
and conduct
|
13.9%
|
16.4%
|
|
10.1%
|
22.0%
|
18.8%
|
15.7%
|
|
12.3%
|
18.7%
|
Barclays International
|
|
|
|
|
|
|
|
|
|
|
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Cost: income ratio
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Total operating expenses
|
(2,446)
|
(2,225)
|
|
(2,684)
|
(2,309)
|
(2,353)
|
(2,315)
|
|
(2,948)
|
(2,187)
|
Impact of litigation and conduct
|
11
|
19
|
|
33
|
32
|
47
|
15
|
|
255
|
5
|
Operating expenses
|
(2,435)
|
(2,206)
|
|
(2,651)
|
(2,277)
|
(2,306)
|
(2,300)
|
|
(2,693)
|
(2,182)
|
|
|
|
|
|
|
|
|
|
|
|
Total income
|
3,903
|
3,570
|
|
3,221
|
3,290
|
3,707
|
3,808
|
|
3,319
|
3,315
|
|
|
|
|
|
|
|
|
|
|
|
Cost: income ratio excluding litigation and conduct
|
62%
|
62%
|
|
82%
|
69%
|
62%
|
60%
|
|
81%
|
66%
|
|
|
|
|
|
|
|
|
|
|
|
Profit before tax
|
|
|
|
|
|
|
|
|
|
|
Profit before tax
|
1,223
|
1,118
|
|
215
|
850
|
1,297
|
1,413
|
|
6
|
652
|
Impact of litigation and conduct
|
11
|
19
|
|
33
|
32
|
47
|
15
|
|
255
|
5
|
Profit before tax excluding litigation and conduct
|
1,234
|
1,137
|
|
248
|
882
|
1,344
|
1,428
|
|
261
|
657
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable to ordinary equity holders of the
parent
|
|
|
|
|
|
|
|
|
|
|
Attributable profit/(loss)
|
832
|
788
|
|
(21)
|
687
|
926
|
1,007
|
|
(1,134)
|
391
|
Post-tax impact of litigation and conduct
|
8
|
16
|
|
34
|
26
|
34
|
12
|
|
250
|
4
|
Profit/(loss) attributable to ordinary equity holders of the parent
excluding litigation and conduct
|
840
|
804
|
|
13
|
713
|
960
|
1,019
|
|
(884)
|
395
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Average allocated equity
|
32.1
|
31.6
|
|
32.4
|
32.5
|
32.8
|
31.4
|
|
29.9
|
31.5
|
Average goodwill and intangibles
|
(1.0)
|
(1.1)
|
|
(1.1)
|
(1.3)
|
(1.4)
|
(1.4)
|
|
(1.4)
|
(2.6)
|
Average allocated tangible equity
|
31.1
|
30.5
|
|
31.3
|
31.1
|
31.4
|
30.1
|
|
28.5
|
28.9
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity excluding litigation
and conduct
|
10.8%
|
10.6%
|
|
0.2%
|
9.2%
|
12.2%
|
13.6%
|
|
(12.4%)
|
5.5%
|
Corporate and Investment Bank
|
|
|
|
|
|
|
|
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Cost: income ratio
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Total operating expenses
|
(1,867)
|
(1,638)
|
|
(2,046)
|
(1,744)
|
(1,773)
|
(1,786)
|
|
(2,384)
|
(1,661)
|
Impact of litigation and conduct
|
7
|
19
|
|
23
|
32
|
-
|
13
|
|
255
|
5
|
Operating expenses
|
(1,860)
|
(1,619)
|
|
(2,023)
|
(1,712)
|
(1,773)
|
(1,773)
|
|
(2,129)
|
(1,656)
|
|
|
|
|
|
|
|
|
|
|
|
Total income
|
2,795
|
2,505
|
|
2,151
|
2,235
|
2,580
|
2,799
|
|
2,252
|
2,280
|
|
|
|
|
|
|
|
|
|
|
|
Cost: income ratio excluding litigation and conduct
|
67%
|
65%
|
|
94%
|
77%
|
69%
|
63%
|
|
95%
|
73%
|
|
|
|
|
|
|
|
|
|
|
|
Profit before tax
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) before tax
|
887
|
827
|
|
85
|
498
|
835
|
1,175
|
|
(252)
|
593
|
Impact of litigation and conduct
|
7
|
19
|
|
23
|
32
|
-
|
13
|
|
255
|
5
|
Profit before tax excluding litigation and conduct
|
894
|
846
|
|
108
|
530
|
835
|
1,188
|
|
3
|
598
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable to ordinary equity holders of the
parent
|
|
|
|
|
|
|
|
|
|
|
Attributable profit/(loss)
|
596
|
582
|
|
(84)
|
431
|
600
|
834
|
|
(1,227)
|
368
|
Post-tax impact of litigation and conduct
|
5
|
16
|
|
27
|
25
|
-
|
10
|
|
250
|
4
|
Profit/(loss) attributable to ordinary equity holders of the parent
excluding litigation and conduct
|
601
|
598
|
|
(57)
|
456
|
600
|
844
|
|
(977)
|
372
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Average allocated equity
|
25.8
|
25.2
|
|
26.0
|
26.2
|
26.7
|
25.9
|
|
24.7
|
25.8
|
Average goodwill and intangibles
|
-
|
(0.1)
|
|
-
|
(0.2)
|
(0.3)
|
(0.3)
|
|
(0.4)
|
(1.1)
|
Average allocated tangible equity
|
25.8
|
25.1
|
|
26.0
|
25.9
|
26.4
|
25.6
|
|
24.3
|
24.8
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity excluding litigation
and conduct
|
9.3%
|
9.5%
|
|
(0.9%)
|
7.0%
|
9.1%
|
13.2%
|
|
(16.1%)
|
6.0%
|
Consumer, Cards and Payments
|
|
|
|
|
|
|
|
|
|
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Cost: income ratio
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Total operating expenses
|
(579)
|
(587)
|
|
(638)
|
(565)
|
(580)
|
(529)
|
|
(564)
|
(526)
|
Impact of litigation and conduct
|
4
|
-
|
|
10
|
-
|
47
|
2
|
|
-
|
-
|
Operating expenses
|
(575)
|
(587)
|
|
(628)
|
(565)
|
(533)
|
(527)
|
|
(564)
|
(526)
|
|
|
|
|
|
|
|
|
|
|
|
Total income
|
1,108
|
1,065
|
|
1,070
|
1,055
|
1,127
|
1,009
|
|
1,067
|
1,035
|
|
|
|
|
|
|
|
|
|
|
|
Cost: income ratio excluding litigation and conduct
|
52%
|
55%
|
|
59%
|
54%
|
47%
|
52%
|
|
53%
|
51%
|
|
|
|
|
|
|
|
|
|
|
|
Profit before tax
|
|
|
|
|
|
|
|
|
|
|
Profit before tax
|
336
|
291
|
|
130
|
352
|
462
|
238
|
|
258
|
59
|
Impact of litigation and conduct
|
4
|
-
|
|
10
|
-
|
47
|
2
|
|
-
|
-
|
Profit before tax excluding litigation and conduct
|
340
|
291
|
|
140
|
352
|
509
|
240
|
|
258
|
59
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable to ordinary equity holders of the
parent
|
|
|
|
|
|
|
|
|
|
|
Attributable profit
|
236
|
206
|
|
63
|
256
|
326
|
173
|
|
93
|
23
|
Post-tax impact of litigation and conduct
|
3
|
-
|
|
7
|
1
|
34
|
2
|
|
-
|
-
|
Profit attributable to ordinary equity holders of the parent
excluding litigation and conduct
|
239
|
206
|
|
70
|
257
|
360
|
175
|
|
93
|
23
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Average allocated equity
|
6.3
|
6.4
|
|
6.4
|
6.3
|
6.0
|
5.5
|
|
5.3
|
5.7
|
Average goodwill and intangibles
|
(1.0)
|
(1.0)
|
|
(1.1)
|
(1.1)
|
(1.1)
|
(1.0)
|
|
(1.1)
|
(1.5)
|
Average allocated tangible equity
|
5.3
|
5.4
|
|
5.3
|
5.2
|
5.0
|
4.5
|
|
4.2
|
4.2
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity excluding litigation
and conduct
|
18.0%
|
15.4%
|
|
5.4%
|
19.9%
|
28.9%
|
15.7%
|
|
9.0%
|
2.2%
|
Head Office
|
|
|
|
|
|
|
|
|
|
Q219
|
Q119
|
|
Q418
|
Q318
|
Q218
|
Q118
|
|
Q417
|
Q317
|
Profit before tax
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Loss before tax
|
(169)
|
(220)
|
|
(231)
|
(129)
|
(58)
|
(1,819)
|
|
(365)
|
(206)
|
Impact of litigation and conduct
|
1
|
39
|
|
12
|
19
|
31
|
1,535
|
|
75
|
65
|
Loss before tax excluding litigation and conduct
|
(168)
|
(181)
|
|
(219)
|
(110)
|
(27)
|
(284)
|
|
(290)
|
(141)
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable to ordinary equity holders of the
parent
|
|
|
|
|
|
|
|
|
|
|
Attributable loss
|
(126)
|
(172)
|
|
(234)
|
(147)
|
(120)
|
(1,699)
|
|
(369)
|
(197)
|
Post-tax impact of litigation and conduct
|
2
|
28
|
|
16
|
11
|
24
|
1,507
|
|
64
|
65
|
Attributable loss excluding litigation and conduct
|
(124)
|
(144)
|
|
(218)
|
(136)
|
(96)
|
(192)
|
|
(305)
|
(132)
|
Tangible net asset value
|
|
|
|
|
As at 30.06.19
|
As at 31.12.18
|
As at 30.06.18
|
|
£m
|
£m
|
£m
|
Total equity excluding non-controlling interests
|
67,576
|
62,556
|
61,055
|
Other equity instruments
|
(12,123)
|
(9,632)
|
(8,938)
|
Goodwill and intangibles
|
(7,993)
|
(7,973)
|
(7,871)
|
Tangible shareholders' equity attributable to ordinary shareholders
of the parent
|
47,460
|
44,951
|
44,246
|
|
|
|
|
|
m
|
m
|
m
|
Shares in issue
|
17,245
|
17,133
|
17,110
|
|
|
|
|
|
p
|
p
|
p
|
Tangible net asset value per share
|
275
|
262
|
259
|
Shareholder Information
|
|
|
|
|
|
Results timetable
1
|
|
|
Date
|
|
|
Ex-dividend date
|
|
|
8 August 2019
|
Dividend record date
|
|
|
9 August 2019
|
Scrip reference share price set and made available to
shareholders
|
|
|
15 August 2019
|
Cut off time of 4.30 pm (UK time) for the receipt of Mandate Forms
or Revocation Forms (as applicable)
|
|
|
23 August 2019
|
Dividend payment date/first day of dealing in new
shares
|
|
|
23 September 2019
|
Q3 2019 Results Announcement
|
|
|
25 October 2019
|
|
|
|
|
|
|
For qualifying US and Canadian resident ADR holders, the half year
dividend of 3.0p per ordinary share becomes 12.0p per ADS
(representing four shares). The ex-dividend, dividend record and
dividend payment dates for ADR holders are as shown
above
.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% Change
3
|
Exchange rates
2
|
30.06.19
|
31.12.18
|
30.06.18
|
31.12.18
|
30.06.18
|
Period end - USD/GBP
|
1.27
|
1.28
|
1.32
|
(1%)
|
(4%)
|
6 month average - USD/GBP
|
1.29
|
1.29
|
1.38
|
-
|
(7%)
|
3 month average - USD/GBP
|
1.29
|
1.29
|
1.36
|
-
|
(5%)
|
Period end - EUR/GBP
|
1.12
|
1.12
|
1.13
|
-
|
(1%)
|
6 month average - EUR/GBP
|
1.15
|
1.12
|
1.14
|
3%
|
1%
|
3 month average - EUR/GBP
|
1.14
|
1.13
|
1.14
|
1%
|
-
|
|
|
|
|
|
|
Share price data
|
|
|
|
|
|
Barclays PLC (p)
|
149.80
|
150.52
|
189.00
|
|
|
Barclays PLC number of shares (m)
|
17,245
|
17,133
|
17,110
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For further information please contact
|
|
|
|
|
|
|
|
|
|
|
|
Investor relations
|
Media relations
|
Lisa Bartrip +44 (0) 20 7773 0708
|
Thomas Hoskin +44 (0) 20 7116 4755
|
|
|
|
|
|
|
More information on Barclays can be found on our website:
home.barclays
.
|
|
|
|
|
|
|
|
|
|
|
|
Registered office
|
|
|
|
|
|
1 Churchill Place, London, E14 5HP, United Kingdom. Tel: +44 (0) 20
7116 1000. Company number: 48839.
|
|
|
|
|
|
|
|
Registrar
|
|
|
|
|
|
Equiniti,
Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, United
Kingdom.
|
|
Tel:
0371 384 2055
4
from the UK or +44
121 415 7004 from overseas.
|
|
American
Depositary Receipts (ADRs)
|
|
|
|
|
|
J.P.Morgan
|
|
|
|
|
|
jpmorgan.adr@eq-us.com
|
|
|
|
|
|
Tel:
+1 800 990 1135 (toll free in US and Canada), +1 651 453 2128
(outside the US and Canada) or +1 651 453 2133 (for the hearing
impaired).
|
https://shareowneronline.equiniti.com/UserManagement/ContactUs.aspx
|
|
|
|
|
|
J.P.Morgan Chase
Bank N.A., Shareholder Services, PO Box 64504, St. Paul, MN
55164-0504, USA.
|
|
|
|
1
|
Note that these dates are provisional and subject to change. Any
changes to the Scrip Dividend Programme dates will be made
available at
home.barclays/dividends
.
|
2
|
The average rates shown above are derived from daily spot rates
during the year.
|
3.
|
The change is the impact to GBP reported information
|
4
|
Lines open 8.30am to 5.30pm (UK time), Monday to Friday, excluding
UK public holidays in England and Wales.
|