UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
July
28, 2021
Barclays PLC
(Name
of Registrant)
1 Churchill Place
London E14 5HP
England
(Address
of Principal Executive Office)
Indicate
by check mark whether the registrant files or will file annual
reports
under
cover of Form 20-F or Form 40-F.
Form
20-F x Form 40-F
Indicate
by check mark whether the registrant by furnishing the
information
contained
in this Form is also thereby furnishing the information to
the
Commission
pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes No
x
If
"Yes" is marked, indicate below the file number assigned to the
registrant
in
connection with Rule 12g3-2(b):
This
Report on Form 6-K is filed by Barclays PLC.
This
Report comprises:
Information
given to The London Stock Exchange and furnished pursuant
to
General
Instruction B to the General Instructions to Form 6-K.
__________________________________________________________________________________
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:
July 28, 2021
|
By: /s/
Garth Wright
--------------------------------
|
|
Garth
Wright
|
|
Assistant
Secretary
|
Barclays PLC
Interim Results Announcement
30 June
2021
Table of Contents
Results Announcement
|
Page
|
Notes
|
1
|
Performance Highlights
|
2
|
Group Chief Executive Officer’s Review
|
6
|
Group Finance Director’s Review
|
7
|
Results by Business
|
|
●
|
Barclays
UK
|
9
|
●
|
Barclays
International
|
11
|
●
|
Head
Office
|
16
|
Quarterly Results Summary
|
17
|
Quarterly Results by Business
|
18
|
Performance Management
|
|
●
|
Margins
and Balances
|
24
|
Risk Management
|
|
●
|
Risk
Management and Principal Risks
|
26
|
●
|
Credit
Risk
|
28
|
●
|
Market
Risk
|
49
|
●
|
Treasury
and Capital Risk
|
50
|
Statement of Directors’ Responsibilities
|
65
|
Independent
Review Report to Barclays PLC
|
66
|
Condensed Consolidated Financial Statements
|
67
|
Financial Statement Notes
|
78
|
Appendix: Non-IFRS Performance Measures
|
104
|
Shareholder Information
|
109
|
BARCLAYS PLC, 1
CHURCHILL PLACE, LONDON, E14 5HP, UNITED KINGDOM. TELEPHONE: +44
(0) 20 7116 1000. COMPANY NO. 48839.
Notes
The terms Barclays
or Group refer to Barclays PLC together with its subsidiaries.
Unless otherwise stated, the income statement analysis compares the
six months ended 30 June 2021 to the corresponding six months of
2020 and balance sheet analysis as at 30 June 2021 with
comparatives relating to 31 December 2020 and 30 June 2020. 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
27 July 2021, does not comprise statutory accounts within the
meaning of Section 434 of the Companies Act 2006. Statutory
accounts for the year ended 31 December 2020, 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
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 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 97 to102 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 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. Forward-looking statements can be
made in writing but also may be made verbally by members of the
management of the Group (including, without limitation, during
management presentations to financial analysts) in connection with
this document. Examples of forward-looking statements include,
among others, statements or guidance regarding or relating to the
Group’s future financial position, income growth, assets,
impairment charges, provisions, business strategy, capital,
leverage and other regulatory ratios, capital distributions
(including dividend pay-out 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. The forward-looking
statements speak only as at the date on which they are made.
Forward-looking statements 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,
the Group’s ability along with governments and other
stakeholders to measure, manage and mitigate the impacts of climate
change effectively, 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 entity within the Group or any
securities issued by such entities; direct and indirect impacts of
the coronavirus (COVID-19) pandemic; instability as a result of the
UK’s exit from the European Union (“EU”), the
effects of the EU-UK Trade and Cooperation Agreement and the
disruption that may subsequently result in the UK and globally; the
risk of cyber-attacks, information or security breaches or
technology failures on the Group’s reputation, business or
operations; and the success of future acquisitions, disposals and
other strategic transactions. A number of these influences and
factors are beyond the Group’s control. As a result, the
Group’s actual financial position, future results, capital
distributions, capital, leverage or other regulatory ratios or
other financial and non-financial metrics or performance measures
may differ materially from the statements or guidance set forth in
the Group’s forward-looking statements. Additional risks and
factors which may impact the Group’s future financial
condition and performance are identified in Barclays PLC’s
filings with the SEC (including, without limitation, Barclays
PLC’s Annual Report on Form 20-F for the fiscal year ended 31
December 2020 and Interim Results Announcement for the six months
ended 30 June 2021 filed on Form 6-K), which are available on the
SEC’s website at www.sec.gov.
Subject
to Barclays’ obligations under the applicable laws and
regulations of any relevant jurisdiction, (including, without
limitation, 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
Group return on tangible equity (RoTE) of 16.4% for H121. Announced
increased capital distributions, with half year dividend of 2.0p
per share and intend to initiate a further share buyback of up to
£500m
Barclays delivered a strong Group profit before tax in H121 of
£5.0bn (H120: £1.3bn) and attributable profit of
£3.8bn (H120: £0.7bn). This delivered a RoTE of 16.4%
(H120: 2.9%) and earnings per share (EPS) of 22.2p (H120:
4.0p)
Income
|
Group income of £11.3bn down 3% versus prior year reflecting
currency headwinds
|
|
●
|
Barclays
International income of £8.2bn, down 5% versus prior
year
|
Resilient
income as the Group continues to benefit from diversified income
streams
|
|
–
|
Corporate
and Investment Bank (CIB) income of £6.6bn, down 5% with
strong Equities and Investment Banking fees performance, up 38% and
27% respectively, whilst FICC was down 37% versus a strong
H120
|
|
–
|
Consumer,
Cards and Payments (CC&P) income of £1.6bn, down 4%
primarily reflecting lower interest earning US cards
balances
|
|
●
|
Barclays
UK income of £3.2bn increased 1% reflecting strong mortgages
performance with record net balance growth of £6.9bn,
partially offset by lower interest earning UK cards balances and
the effect of lower interest rates
|
●
|
Excluding
the impact of the 10% depreciation of average USD against GBP,
Group income was up versus prior year
|
Credit impairment
|
Group credit impairment net release of £0.7bn (H120:
£3.7bn charge)
|
Improved
macroeconomic outlook and benign credit environment
|
●
|
The net
release included a reversal of £1.1bn in non-default charges,
primarily reflecting the improved macroeconomic outlook. Excluding
this reversal, the charge was £0.4bn, reflecting reduced
unsecured lending balances and the benign credit
environment
|
Costs
|
Group total operating expenses of £7.2bn up 10% versus prior
year, resulting in a cost: income ratio of 64% (H120:
57%)
|
Investing
for income growth whilst taking structural cost
actions
|
●
|
Total
operating expenses included structural cost actions of £321m
(H120: £78m), primarily related to the real estate review in
Q221, higher performance costs reflective of improved returns, and
continued investment and business growth, partially offset by the
benefit from the depreciation of average USD against GBP and
efficiency savings
|
Capital / capital distributions
|
Common equity tier 1 (CET1) ratio of 15.1%, in line with December
2020
|
Announced
increased capital distributions
|
●
|
Half
year dividend of 2.0p (H120: 0p) per share to be paid on 17
September 2021
|
●
|
Completed
£700m share buyback in April
|
●
|
Intend
to initiate a further share buyback of up to £500m, which
would have an effect of 17bps on the CET1 ratio
|
Q221 performance
Q221 performance
Robust
performance, with profitability benefiting from a credit impairment
net release and the upwards re-measurement of UK DTAs
|
Q221 Group profit before tax of £2.6bn (Q220: £0.4bn),
RoTE of 18.1% (Q220: 0.7%) and EPS of 12.3p (Q220:
0.5p)
|
●
|
Q221 Group income of £5.4bn, up 1% versus prior year despite
currency headwinds. Barclays International income of
£3.8bn was down 5% versus prior year, reflecting CIB income of
£3.0bn, down 10% versus prior year and CC&P income of
£0.8bn, up 21% versus prior year driven by a valuation loss in
2020. Barclays UK income of £1.6bn was up 11% versus prior
year
|
●
|
Q221 Group credit impairment net release of £0.8bn (Q220:
£1.6bn charge), reflecting a reversal of £1.0bn in
non-default charges, primarily reflecting the improved
macroeconomic outlook. Excluding this reversal, the charge was
£0.2bn, which is broadly aligned with prior
quarter
|
●
|
Q221 Group total operating expenses of £3.7bn, up £0.3bn
versus prior year, reflecting structural cost
actions
|
●
|
Q221 attributable profit of £2.1bn (Q220: £0.1bn),
which included an income statement tax benefit of £0.4bn on
the upwards re-measurement of UK deferred tax assets
(DTAs)
|
●
|
The CET1 ratio as at June 2021 was 15.1%, up 50bps in the
quarter, driven by profits and lower Risk Weighted Assets
(RWAs)
|
Group outlook and targets
Outlook
Whilst
the macroeconomic environment has improved, the outlook remains
uncertain and subject to change depending on the evolution and
persistence of the COVID-19 pandemic
|
Returns
|
●
|
Expect
to deliver a RoTE above 10% in 2021
|
|
Impairment
|
●
|
The
quarterly impairment run rate is expected to remain below
historical levels in coming quarters given reduced unsecured
lending balances and the improved macroeconomic outlook,
acknowledging the continuing uncertainty
|
|
Costs
|
●
|
FY21
costs, excluding structural cost actions and performance costs, are
expected to be broadly in line with FY201
|
●
|
Total
full year 2021 costs are expected to be above 2020, due to higher
structural cost actions, including a real estate charge in Q221,
and higher performance costs, reflecting improved
returns
|
|
Capital
|
●
|
FY21
CET1 ratio is expected to remain above the target range of 13-14%,
given the economic environment remains uncertain and capital
headwinds in 2022, including the c.40bps impact from the reversal
of software amortisation benefit from 1 January 2022
|
|
Capital returns
|
●
|
Barclays’
capital returns policy incorporates a progressive ordinary
dividend, supplemented by additional cash returns, including 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
|
Targets
|
Continue to target the following over the medium term:
|
●
|
Returns:
RoTE of greater than 10%
|
●
|
Cost
efficiency: Cost: income ratio below 60%
|
●
|
Capital
adequacy: CET1 ratio in the range of 13-14%
|
1
|
Group cost outlook is based on an average rate of 1.38 (USD/GBP) in
H221 and subject to foreign currency movements.
|
Barclays Group results
for the half year ended
|
|
|
30.06.21
|
30.06.20
|
|
|
£m
|
£m
|
% Change
|
Net interest income
|
3,903
|
4,223
|
(8)
|
Net fee, commission and other income
|
7,412
|
7,398
|
|
Total income
|
11,315
|
11,621
|
(3)
|
Credit impairment releases/(charges)
|
742
|
(3,738)
|
|
Net operating income
|
12,057
|
7,883
|
53
|
Operating expenses
|
(7,132)
|
(6,563)
|
(9)
|
Litigation and conduct
|
(99)
|
(30)
|
|
Total operating expenses
|
(7,231)
|
(6,593)
|
(10)
|
Other net income/expenses
|
153
|
(18)
|
|
Profit before tax
|
4,979
|
1,272
|
|
Tax charge
|
(759)
|
(113)
|
|
Profit after tax
|
4,220
|
1,159
|
|
Non-controlling interests
|
(19)
|
(37)
|
49
|
Other equity instrument holders
|
(389)
|
(427)
|
9
|
Attributable profit
|
3,812
|
695
|
|
|
|
|
|
Performance measures
|
|
|
|
Return on average tangible shareholders' equity
|
16.4%
|
2.9%
|
|
Average tangible shareholders' equity (£bn)
|
46.5
|
48.6
|
|
Cost: income ratio
|
64%
|
57%
|
|
Loan loss rate (bps)
|
—
|
207
|
|
Basic earnings per share
|
22.2p
|
4.0p
|
|
Dividend per share
|
2.0p
|
—
|
|
Basic weighted average number of shares (m)
|
17,140
|
17,294
|
|
Period end number of shares (m)
|
16,998
|
17,345
|
|
Share buyback announced (£m)
|
500
|
—
|
|
Total payout equivalent per share
|
4.9p
|
—
|
|
|
|
|
|
|
As at 30.06.21
|
As at 31.12.20
|
As at 30.06.20
|
Balance sheet and capital management1
|
£bn
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
348.5
|
342.6
|
354.9
|
Loans and advances at amortised cost impairment coverage
ratio
|
1.8%
|
2.4%
|
2.5%
|
Deposits at amortised cost
|
500.9
|
481.0
|
466.9
|
Tangible net asset value per share
|
281p
|
269p
|
284p
|
Common equity tier 1 ratio
|
15.1%
|
15.1%
|
14.2%
|
Common equity tier 1 capital
|
46.2
|
46.3
|
45.4
|
Risk weighted assets
|
306.4
|
306.2
|
319.0
|
Average UK leverage ratio
|
4.8%
|
5.0%
|
4.7%
|
UK leverage ratio
|
5.0%
|
5.3%
|
5.2%
|
|
|
|
|
Funding and liquidity
|
|
|
|
Group liquidity pool (£bn)
|
291
|
266
|
298
|
Liquidity coverage ratio
|
162%
|
162%
|
186%
|
Loan: deposit ratio
|
70%
|
71%
|
76%
|
1
|
Refer to pages 54 to 60 for further information on how capital,
RWAs and leverage are calculated.
|
Group
Chief Executive Officer’s Review
“This
has been a strong first half, clearly demonstrating the benefits of
our resilient and diversified universal bank in supporting the
growth of capital markets, our corporate clients and retail
customers. Barclays UK, and the CIB and CC&P businesses within
Barclays International have all delivered strong double-digit RoTE.
Our investment banking fees and equities businesses have delivered
record income1, and we are seeing
encouraging signs of recovery in consumer banking. Our
profitability, strong capital position and balance sheet have
enabled us to increase capital distributions to
shareholders.
We are starting to see the resurgence of activity across our
businesses, with Group income up on the same period last year when
excluding the impact of FX movements. Our CIB business is
well-positioned to benefit from continued growth in debt and equity
capital markets, with Global Markets and Investment Banking fees
income up 36% since 2019, and our strong retail businesses are
poised to support and benefit from a consumer
recovery.
We are also continuing to build our presence where we see further
opportunities to scale, by organically growing our own products and
service, and by partnering. Whilst we continue to develop our
leading payments services including our new Barclays Cubed
platform, we are also able to partner with major businesses in our
US consumer banking business. In CIB, we are enhancing our ability
to compete for client business with a stronger product and service
set, from transaction banking to our equity franchise, alongside a
build-out of our sectoral expertise in healthcare, technology and
sustainability.
We will continue to invest behind those opportunities we see for
growing income and returns across our businesses, whilst also
driving efficiencies and savings across Barclays. Excluding
performance costs and structural cost actions, costs in 2021 will
be broadly in line with 20202.
Against this backdrop of economic recovery, our robust approach to
risk management means we are making a net impairment release of
£0.7bn versus a charge of £3.7bn in H120. We also
delivered a CET1 ratio of 15.1%, and increased capital
distributions, with the announcement of a half year dividend of 2
pence per share, alongside the intention to initiate a share
buyback of up to £500m. This is in addition to the £700m
share buyback completed in April.
Alongside the role we play in supporting economic growth, we are
firmly focused on our wider societal responsibilities. We continue
to drive hard on our ambition to be a net zero bank, and support
the aims of the Paris Agreement, already having provided nearly
half of our £100bn green financing commitment through our
capital markets and lending expertise. We continue to develop our
ability to measure our financed emissions and track them at a
portfolio level through our unique BlueTrack TM
methodology.
We have also demonstrated our ability, and willingness, to support
customers and clients through the pandemic, and we are mindful that
this support will need to continue as we see the pandemic
subside.
Taken together, we continue to invest behind opportunities for
growth, manage our capital and balance sheet conservatively, and
focus on our role in society. With a first half profit before tax
of £5bn, quadruple the same period last year, and a RoTE of
16.4%, this is a good first half performance. It provides a strong
platform on which to build in the second half, and to deliver a
full year RoTE in excess of 10%.”
James E Staley, Group Chief Executive Officer
1
|
Period covering Q114 - Q221. Pre 2014 financials were not restated
following re-segmentation in Q116.
|
2
|
Group cost outlook is based on an average rate of 1.38 (USD/GBP) in
H221 and subject to foreign currency movements.
|
Group
Finance Director’s Review
Group performance
●
|
Barclays
delivered a profit before tax of £4,979m (H120: £1,272m),
RoTE of 16.4% (H120: 2.9%), and EPS of 22.2p (H120: 4.0p).
Profitability benefitted from a credit impairment net release and
the upwards re-measurement of UK DTAs. The 10% depreciation of
average USD against GBP adversely impacted income and profits and
positively impacted total operating expenses
|
●
|
Total
income decreased to £11,315m (H120: £11,621m). Barclays
UK income increased 1%. Barclays International income decreased 5%,
with CIB income down 5% and CC&P income down 4%. Excluding the
impact of the 10% depreciation of average USD against GBP, total
income was up, reflecting the Group’s diversified income
streams
|
●
|
Credit
impairment net release of £742m (H120: £3,738m charge)
driven by an improved macroeconomic outlook used in the Q221
scenario refresh, lower unsecured lending balances and a benign
credit environment. Barclays has maintained and refined management
judgements in respect of customers and clients considered to be
potentially more vulnerable as government and other support schemes
start to reduce. The reduction in unsecured lending balances and
growth in secured balances, with the mix impact contributing to a
decrease in the Group’s loan coverage ratio to 1.8% (December
2020: 2.4%), with an unsecured loan coverage ratio at 10.2%
(December 2020: 12.3%) and wholesale loan coverage ratio at 1.1%
(December 2020: 1.5%)
|
●
|
Total
operating expenses increased 10% to £7,231m, due to structural
cost actions of £321m primarily relating to the real estate
review, higher performance costs that reflect improvement in
returns, and continued investment and business growth, partially
offset by efficiency savings. This resulted in a cost: income ratio
of 64% (H120: 57%)
|
●
|
The
effective tax rate was 15.2% (H120: 8.9%). This reflects the
£392m tax benefit recognised for the re-measurement of the
Group’s UK DTAs as a result of the UK corporation tax rate
increase from 19% to 25% from 1 April 2023
|
●
|
Attributable
profit was £3,812m (H120: £695m)
|
●
|
As a
result of the share buyback completed in April, the period end
number of shares was 16,998m (December 2020: 17,359m)
|
●
|
Total
assets increased to £1,376bn (December 2020: £1,350bn)
primarily due to a £26bn increase in cash at central banks, a
£19bn increase in trading portfolio assets due to increased
activity and a £19bn increase in financial assets at fair
value due to an increase in secured lending, partially offset by a
£46bn decrease in derivative assets driven by an increase in
major interest rate curves
|
●
|
Tangible
net asset value (TNAV) per share increased to 281p (December 2020:
269p) primarily reflecting 22.2p of EPS, partially offset by
negative reserve movements
|
Group capital and leverage
●
|
The
CET1 ratio remained stable at 15.1% (December 2020:
15.1%)
|
|
–
|
CET1
capital reduced by £0.1bn to £46.2bn (December 2020:
£46.3bn) as profit before tax of £5.0bn was offset by the
removal of temporary regulatory supporting measures introduced in
2020, dividends paid and foreseen and pensions deficit contribution
payments. The £1.1bn release of non-defaulted credit
impairment was more than offset by a reduction in IFRS 9
transitional relief which also decreased due to impairment
migrations from stage 2 to stage 3 and the relief on the pre-2020
impairment charge reducing from 70% to 50% in 2021
|
|
–
|
RWAs
remained broadly stable at £306.4bn (December 2020:
£306.2bn) primarily due to increased client and trading
activity within CIB and growth in mortgages within Barclays UK,
partially offset by lower consumer lending
|
●
|
The
average UK leverage ratio decreased to 4.8% (December 2020: 5.0%).
The average leverage exposure increased by £45.1bn to
£1,192.0bn (December 2020: £1,146.9bn) largely driven by
an increase in securities financing transactions (SFTs), trading
portfolio assets (TPAs) and potential future exposure (PFE) on
derivatives
|
Group funding and liquidity
●
|
The
liquidity pool was £291bn (December 2020: £266bn) and the
liquidity coverage ratio remained significantly above the 100%
regulatory requirement at 162% (December 2020: 162%), equivalent to
a surplus of £108bn (December 2020: £99bn). The increase
in the pool is driven by continued deposit growth, further
borrowing from the Bank of England’s Term Funding Scheme with
additional incentives for SMEs and a seasonal increase in
short-term wholesale funding, which were partly offset by an
increase in business funding consumption
|
●
|
Wholesale
funding outstanding, excluding repurchase agreements, was
£158.7bn (December 2020: £145.0bn). The Group issued
£5.9bn equivalent of minimum requirement for own funds and
eligible liabilities (MREL) instruments from Barclays PLC (the
Parent company) during the year. The Group is well advanced in its
MREL issuance plans relative to the estimated 1 January 2022
requirement
|
Capital distributions
●
|
Barclays
understands the importance of delivering attractive total 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 continue to supplement the ordinary dividends with
additional cash returns, including share buybacks, to shareholders
as and when appropriate
|
●
|
Barclays
will pay a half year dividend per share of 2.0p on 17 September
2021, and intends to initiate a share buyback of up to £500m
which is expected to commence in Q321. This is in addition to the
£700m share buyback completed in April
|
●
|
The
Board will assess the appropriate level and form of capital
distributions as the year progresses
|
●
|
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
Results by Business
Barclays UK
|
Half year ended
|
Half year ended
|
|
|
30.06.21
|
30.06.20
|
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
2,586
|
2,637
|
(2)
|
Net fee, commission and other income
|
613
|
534
|
15
|
Total income
|
3,199
|
3,171
|
1
|
Credit impairment releases/(charges)
|
443
|
(1,064)
|
|
Net operating income
|
3,642
|
2,107
|
73
|
Operating expenses
|
(2,114)
|
(2,041)
|
(4)
|
Litigation and conduct
|
(22)
|
(11)
|
|
Total operating expenses
|
(2,136)
|
(2,052)
|
(4)
|
Other net income
|
—
|
13
|
|
Profit before tax
|
1,506
|
68
|
|
Attributable profit
|
1,019
|
52
|
|
|
|
|
|
|
As at 30.06.21
|
As at 31.12.20
|
As at 30.06.20
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances to customers at amortised cost
|
207.8
|
205.4
|
202.0
|
Total assets
|
311.2
|
289.1
|
287.6
|
Customer deposits at amortised cost
|
255.5
|
240.5
|
225.7
|
Loan: deposit ratio
|
87%
|
89%
|
92%
|
Risk weighted assets
|
72.2
|
73.7
|
77.9
|
Period end allocated tangible equity
|
9.9
|
9.7
|
10.3
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Key facts
|
30.06.21
|
30.06.20
|
|
Average
loan to value of mortgage portfolio1
|
51%
|
52%
|
|
Average
loan to value of new mortgage lending1
|
69%
|
68%
|
|
Number of branches
|
755
|
904
|
|
Mobile banking active customers
|
9.4m
|
8.7m
|
|
30 day arrears rate - Barclaycard Consumer UK
|
1.4%
|
2.0%
|
|
|
|
|
|
Performance measures
|
|
|
|
Return on average allocated tangible equity
|
20.6%
|
1.0%
|
|
Average allocated tangible equity (£bn)
|
9.9
|
10.2
|
|
Cost: income ratio
|
67%
|
65%
|
|
Loan loss rate (bps)
|
—
|
101
|
|
Net interest margin
|
2.54%
|
2.69%
|
|
1
|
Average loan to value of mortgages is balance weighted and reflects
both residential and buy-to-let (BTL) mortgage portfolios within
the Home Loans portfolio.
|
Analysis of Barclays UK
|
Half year ended
|
Half year ended
|
|
30.06.21
|
30.06.20
|
|
Analysis of total income
|
£m
|
£m
|
% Change
|
Personal Banking
|
1,910
|
1,794
|
6
|
Barclaycard Consumer UK
|
605
|
803
|
(25)
|
Business Banking
|
684
|
574
|
19
|
Total income
|
3,199
|
3,171
|
1
|
|
|
|
|
Analysis of credit impairment releases/(charges)
|
|
|
|
Personal Banking
|
50
|
(264)
|
|
Barclaycard Consumer UK
|
398
|
(697)
|
|
Business Banking
|
(5)
|
(103)
|
|
Total credit impairment releases/(charges)
|
443
|
(1,064)
|
|
|
|
|
|
|
As at 30.06.21
|
As at 31.12.20
|
As at 30.06.20
|
Analysis of loans and advances to customers at amortised
cost
|
£bn
|
£bn
|
£bn
|
Personal Banking
|
162.4
|
157.3
|
154.9
|
Barclaycard Consumer UK
|
8.8
|
9.9
|
11.5
|
Business Banking
|
36.6
|
38.2
|
35.6
|
Total loans and advances to customers at amortised
cost
|
207.8
|
205.4
|
202.0
|
|
|
|
|
Analysis of customer deposits at amortised cost
|
|
|
|
Personal Banking
|
191.0
|
179.7
|
169.6
|
Barclaycard Consumer UK
|
0.1
|
0.1
|
0.1
|
Business Banking
|
64.4
|
60.7
|
56.0
|
Total customer deposits at amortised cost
|
255.5
|
240.5
|
225.7
|
Barclays
UK delivered a RoTE of 20.6% including the benefit from a net
impairment release following an improved UK macroeconomic outlook.
Income increased 1% reflecting strong growth in mortgage balances
of £6.9bn at improved margins, despite a £1.5bn reduction
in unsecured lending balances. Barclays UK grew deposits by
£15.0bn, further strengthening the liquidity position
reflected in the loan: deposit ratio of 87%, 2% lower than
FY20.
Income statement – H121 compared to H120
●
|
Profit
before tax increased to £1,506m (H120: £68m). RoTE was
20.6% (H120: 1.0%) reflecting materially lower credit impairment
charges
|
●
|
Total
income increased 1% to £3,199m. Net interest income reduced 2%
to £2,586m with a net interest margin (NIM) of 2.54% (H120:
2.69%). Net fee, commission and other income increased 15% to
£613m
|
|
–
|
Personal
Banking income increased 6% to £1,910m, reflecting strong
growth in mortgages alongside improved margins, balance growth in
deposits and the non-recurrence of COVID-19 customer support
actions, partially offset by deposit margin compression from lower
interest rates and lower unsecured lending balances
|
|
–
|
Barclaycard
Consumer UK income decreased 25% to £605m as reduced borrowing
and continued payments by customers resulted in a lower level of
interest earning lending (IEL) balances
|
|
–
|
Business
Banking income increased 19% to £684m due to lending and
deposit balance growth from £12.1bn of government scheme
lending and the non-recurrence of COVID-19 and related customer
support actions, partially offset by deposit margin compression
from lower interest rates
|
●
|
Credit
impairment net release of £443m (H120: £1,064m charge)
was driven by an improved macroeconomic outlook used in the Q221
scenario refresh. The primary driver is a reduction in the
anticipated peak of UK unemployment with the majority of this
provision release in UK cards and personal loans. As at 30 June
2021, 30 and 90 day arrears rates in UK cards were 1.4% (H120:
2.0%) and 0.6% (H120: 1.0%) respectively
|
●
|
Total
operating expenses increased 4% to £2,136m reflecting
investment spend and higher operational and customer service costs,
including ongoing financial assistance, partially offset by
efficiency savings
|
Balance sheet – 30 June 2021 compared to 31 December
2020
●
|
Loans
and advances to customers at amortised cost increased 1% to
£207.8bn predominantly from £6.9bn of mortgage growth
following continued strong flow of new applications as well as
strong customer retention, offset by a £1.8bn decrease in the
Education, Social Housing and Local Authority (ESHLA) portfolio and
£1.5bn lower unsecured lending balances, albeit loans and
advances in Barclaycard Consumer UK stabilised in Q221
|
●
|
Customer
deposits at amortised cost increased 6% to £255.5bn reflecting
an increase of £11.3bn and £3.7bn in Personal Banking and
Business Banking respectively, further strengthening the liquidity
position and contributing to a loan: deposit ratio of 87% (December
2020: 89%)
|
●
|
RWAs
decreased to £72.2bn (December 2020: £73.7bn) driven by a
reduction in unsecured lending and ESHLA, partially offset by
growth in mortgages
|
Barclays International
|
Half year ended
|
Half year ended
|
|
|
30.06.21
|
30.06.20
|
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
1,559
|
1,845
|
(16)
|
Net trading income
|
3,389
|
4,020
|
(16)
|
Net fee, commission and other income
|
3,270
|
2,789
|
17
|
Total income
|
8,218
|
8,654
|
(5)
|
Credit impairment releases/(charges)
|
293
|
(2,619)
|
|
Net operating income
|
8,511
|
6,035
|
41
|
Operating expenses
|
(4,606)
|
(4,405)
|
(5)
|
Litigation and conduct
|
(84)
|
(11)
|
|
Total operating expenses
|
(4,690)
|
(4,416)
|
(6)
|
Other net income
|
22
|
10
|
|
Profit before tax
|
3,843
|
1,629
|
|
Attributable profit
|
2,698
|
997
|
|
|
|
|
|
|
As at 30.06.21
|
As at 31.12.20
|
As at 30.06.20
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
121.9
|
122.7
|
138.1
|
Trading portfolio assets
|
147.1
|
127.7
|
109.5
|
Derivative financial instrument assets
|
255.4
|
301.8
|
306.8
|
Financial assets at fair value through the income
statement
|
190.4
|
170.7
|
154.3
|
Cash collateral and settlement balances
|
108.5
|
97.5
|
130.8
|
Other assets
|
223.5
|
221.4
|
236.3
|
Total assets
|
1,046.8
|
1,041.8
|
1,075.8
|
Deposits at amortised cost
|
245.4
|
240.5
|
241.2
|
Derivative financial instrument liabilities
|
246.9
|
300.4
|
307.6
|
Loan: deposit ratio
|
50%
|
51%
|
57%
|
Risk weighted assets
|
223.2
|
222.3
|
231.2
|
Period end allocated tangible equity
|
31.8
|
30.2
|
31.6
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Performance measures
|
30.06.21
|
30.06.20
|
|
Return on average allocated tangible equity
|
16.7%
|
6.2%
|
|
Average allocated tangible equity (£bn)
|
32.3
|
32.4
|
|
Cost: income ratio
|
57%
|
51%
|
|
Loan loss rate (bps)
|
—
|
368
|
|
Net interest margin
|
3.95%
|
3.67%
|
|
Analysis of Barclays International
|
|
|
|
Corporate and Investment Bank
|
Half year ended
|
Half year ended
|
|
|
30.06.21
|
30.06.20
|
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
640
|
669
|
(4)
|
Net trading income
|
3,411
|
4,043
|
(16)
|
Net fee, commission and other income
|
2,522
|
2,221
|
14
|
Total income
|
6,573
|
6,933
|
(5)
|
Credit impairment releases/(charges)
|
272
|
(1,320)
|
|
Net operating income
|
6,845
|
5,613
|
22
|
Operating expenses
|
(3,509)
|
(3,370)
|
(4)
|
Litigation and conduct
|
(2)
|
(3)
|
33
|
Total operating expenses
|
(3,511)
|
(3,373)
|
(4)
|
Other net income
|
1
|
3
|
(67)
|
Profit before tax
|
3,335
|
2,243
|
49
|
Attributable profit
|
2,312
|
1,514
|
53
|
|
|
|
|
|
As at 30.06.21
|
As at 31.12.20
|
As at 30.06.20
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
91.0
|
92.4
|
104.9
|
Trading portfolio assets
|
147.0
|
127.5
|
109.3
|
Derivative financial instrument assets
|
255.3
|
301.7
|
306.7
|
Financial assets at fair value through the income
statement
|
190.3
|
170.4
|
153.7
|
Cash collateral and settlement balances
|
107.7
|
96.7
|
129.7
|
Other assets
|
192.5
|
194.9
|
205.5
|
Total assets
|
983.8
|
983.6
|
1,009.8
|
Deposits at amortised cost
|
178.2
|
175.2
|
173.9
|
Derivative financial instrument liabilities
|
246.8
|
300.3
|
307.6
|
Risk weighted assets
|
194.3
|
192.2
|
198.3
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Performance measures
|
30.06.21
|
30.06.20
|
|
Return on average allocated tangible equity
|
16.3%
|
11.0%
|
|
Average allocated tangible equity (£bn)
|
28.3
|
27.7
|
|
Cost: income ratio
|
53%
|
49%
|
|
|
|
|
|
|
|
|
|
Analysis of total income
|
£m
|
£m
|
% Change
|
FICC
|
2,099
|
3,326
|
(37)
|
Equities
|
1,709
|
1,238
|
38
|
Global Markets1
|
3,808
|
4,564
|
(17)
|
Advisory
|
381
|
239
|
59
|
Equity capital markets
|
469
|
247
|
90
|
Debt capital markets
|
882
|
881
|
|
Investment Banking fees1
|
1,732
|
1,367
|
27
|
Corporate lending
|
244
|
172
|
42
|
Transaction banking
|
789
|
830
|
(5)
|
Corporate
|
1,033
|
1,002
|
3
|
Total income
|
6,573
|
6,933
|
(5)
|
1
|
Previously labelled as “Markets” and “Banking
fees”.
|
Analysis of Barclays International
|
|
|
|
Consumer, Cards and Payments
|
Half year ended
|
Half year ended
|
|
|
30.06.21
|
30.06.20
|
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
919
|
1,176
|
(22)
|
Net fee, commission, trading and other income
|
726
|
545
|
33
|
Total income
|
1,645
|
1,721
|
(4)
|
Credit impairment releases/(charges)
|
21
|
(1,299)
|
|
Net operating income
|
1,666
|
422
|
|
Operating expenses
|
(1,097)
|
(1,035)
|
(6)
|
Litigation and conduct
|
(82)
|
(8)
|
|
Total operating expenses
|
(1,179)
|
(1,043)
|
(13)
|
Other net income
|
21
|
7
|
|
Profit/(loss) before tax
|
508
|
(614)
|
|
Attributable profit/(loss)
|
386
|
(517)
|
|
|
|
|
|
|
As at 30.06.21
|
As at 31.12.20
|
As at 30.06.20
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
30.9
|
30.3
|
33.2
|
Total assets
|
63.0
|
58.2
|
66.0
|
Deposits at amortised cost
|
67.2
|
65.3
|
67.3
|
Risk weighted assets
|
29.0
|
30.1
|
32.9
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Key facts
|
30.06.21
|
30.06.20
|
|
30 day arrears rate – Barclaycard US
|
1.6%
|
2.4%
|
|
US cards customer FICO score distribution
|
|
|
|
<660
|
10%
|
14%
|
|
>660
|
90%
|
86%
|
|
Total number of Barclaycard payments clients
|
c.372,000
|
c.368,000
|
|
Value
of payments processed (£bn)1
|
160
|
156
|
|
|
|
|
|
Performance measures
|
|
|
|
Return on average allocated tangible equity
|
19.1%
|
(21.9)%
|
|
Average allocated tangible equity (£bn)
|
4.0
|
4.7
|
|
Cost: income ratio
|
72%
|
61%
|
|
Loan loss rate (bps)
|
—
|
714
|
|
|
Half year ended
|
Half year ended
|
|
30.06.21
|
30.06.20
|
|
Analysis of total income
|
£m
|
£m
|
% Change
|
International Cards and Consumer Bank
|
1,050
|
1,257
|
(16)
|
Private Bank
|
393
|
362
|
9
|
Unified Payments
|
202
|
102
|
98
|
Total income
|
1,645
|
1,721
|
(4)
|
1
|
Includes £129bn (H120: £124bn) of merchant acquiring
payments.
|
Barclays
International delivered a RoTE of 16.7% reflecting the benefits of
a diversified business. CIB delivered a RoTE of 16.3% reflecting a
strong performance in Equities and Investment Banking fees, offset
by a decrease in FICC against a very strong H120 comparative.
CC&P RoTE improved significantly to 19.1% as a decline in
income, reflecting lower cards balances, was more than offset by an
improvement in impairment.
Income statement – H121 compared to H120
●
|
Profit
before tax increased 136% to £3,843m with a RoTE of 16.7%
(H120: 6.2%), reflecting a RoTE of 16.3% (H120: 11.0%) in CIB and
19.1% (H120: (21.9)%) in CC&P
|
●
|
The 10%
depreciation of average USD against GBP adversely impacted income
and profits and positively impacted total operating
expenses
|
●
|
Total
income decreased to £8,218m (H120: £8,654m)
|
|
–
|
CIB
income decreased 5% to £6,573m
|
|
|
–
|
Global
Markets income decreased 17% to £3,808m as a strong
performance in Equities, representing the best ever first half of
the year on a comparable basis1, was more than
offset by FICC. Equities income increased 38% to £1,709m
driven by derivatives, reflecting strong client activity, and
financing through increased client balances. FICC income decreased
37% to £2,099m due to tighter spreads and the non-recurrence
of H120 client activity levels
|
|
|
–
|
Investment
Banking fees income, representing the best ever first half of the
year on a comparable basis1, increased 27% to
£1,732m driven by a strong performance in Equity capital
markets and Advisory reflecting an increase in the fee pool and an
increased market share2
|
|
|
–
|
Within
Corporate, Transaction banking income decreased 5% to £789m as
deposit balance growth was more than offset by margin compression.
Corporate lending income increased by 42% to £244m driven by
the non-recurrence of losses on the mark-to-market of lending and
related hedge positions partially offset by a current year
write-off on a single name
|
|
–
|
CC&P
income decreased 4% to £1,645m
|
|
|
–
|
International
Cards and Consumer Bank income decreased 16% to £1,050m
reflecting lower cards balances
|
|
|
–
|
Private
Bank income increased 9% to £393m, which included a gain on a
property sale
|
|
|
–
|
Unified
Payments income increased 98% to £202m driven by the
non-recurrence of a c.£100m valuation loss on Barclays’
preference shares in Visa Inc. resulting from the Q220 Supreme
Court ruling concerning charges paid by merchants
|
●
|
Credit
impairment net release of £293m (H120: £2,619m charge)
was driven by an improved macroeconomic outlook used in the Q221
scenario refresh
|
|
–
|
CIB
credit impairment net release of £272m (H120: £1,320m
charge), supported by a benign credit risk environment and limited
single name wholesale loan charges
|
|
–
|
CC&P
credit impairment net release of £21m (H120: £1,299m
charge) partially driven by lower delinquencies and customer
repayments. As at 30 June 2021, 30 and 90 day arrears in US cards
were 1.6% (H120: 2.4%) and 0.9% (H120: 1.4%)
respectively
|
●
|
Total
operating expenses increased 6% to £4,690m
|
|
–
|
CIB
total operating expenses increased 4% to £3,511m due to higher
performance costs that reflected an improvement in
returns
|
|
–
|
CC&P
total operating expenses increased 13% to £1,179m driven by
the impact of higher investment spend, including marketing, and
customer remediation costs related to a legacy
portfolio
|
Balance sheet – 30 June 2021 compared to 31 December
2020
●
|
Trading
portfolio assets increased £19.4bn to £147.1bn due to
increased activity
|
●
|
Derivative
financial instruments assets decreased £46.4bn and liabilities
decreased £53.5bn to £255.4bn and £246.9bn
respectively, driven by an increase in major interest rate
curves
|
●
|
Financial
assets at fair value through the income statement increased
£19.7bn to £190.4bn driven by increased secured
lending
|
●
|
Cash
collateral and settlements balances increased £11.0bn to
£108.5bn due to increased client activity
|
●
|
Deposits
at amortised cost increased £4.9bn to £245.4bn due to
clients increasing liquidity
|
●
|
RWAs
increased to £223.2bn (December 2020: £222.3bn) primarily
due to increased client and trading activity within CIB, partially
offset by the depreciation of period end EUR and USD against
GBP
|
1
|
Period covering Q114 – Q221. Pre 2014 financials were not
restated following re-segmentation in Q116.
|
2
|
Data source: Dealogic for the period covering 1 January to 30 June
2021.
|
Head Office
|
Half year ended
|
Half year ended
|
|
|
30.06.21
|
30.06.20
|
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
(242)
|
(259)
|
7
|
Net fee, commission and other income
|
140
|
55
|
|
Total income
|
(102)
|
(204)
|
50
|
Credit impairment releases/(charges)
|
6
|
(55)
|
|
Net operating income
|
(96)
|
(259)
|
63
|
Operating expenses
|
(412)
|
(117)
|
|
Litigation and conduct
|
7
|
(8)
|
|
Total operating expenses
|
(405)
|
(125)
|
|
Other net income/(expenses)
|
131
|
(41)
|
|
Loss before tax
|
(370)
|
(425)
|
13
|
Attributable profit/(loss)
|
95
|
(354)
|
|
|
|
|
|
|
As at 30.06.21
|
As at 31.12.20
|
As at 30.06.20
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Total assets
|
18.3
|
18.6
|
21.7
|
Risk weighted assets
|
11.1
|
10.2
|
9.9
|
Period end allocated tangible equity
|
5.9
|
6.8
|
7.4
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Performance measures
|
30.06.21
|
30.06.20
|
|
Average allocated tangible equity (£bn)
|
4.3
|
6.0
|
|
Income statement – H121 compared to H120
●
|
Loss
before tax was £370m (H120: £425m)
|
●
|
Total
income was an expense of £102m (H120: £204m), which
primarily reflected hedge accounting, funding costs on legacy
capital instruments and treasury items, partially offset by
mark-to-market gains on legacy investments
|
●
|
Credit
impairment net release of £6m (H120: £55m charge) was
driven by an improved macroeconomic outlook used in the Q221
scenario refresh, resulting in a provision release for the Italian
home loan portfolio
|
●
|
Total
operating expenses were £405m (H120: £125m), which
included a charge of £266m relating to structural cost actions
taken as part of the real estate review
|
●
|
Other
net income was £131m (H120: £41m expense) driven by a
fair value gain in Barclays’ associate investment holding in
the Business Growth Fund
|
Balance sheet – 30 June 2021 compared to 31 December
2020
●
|
RWAs
were £11.1bn (December 2020: £10.2bn)
|
Quarterly Results Summary
Barclays Group
|
|
|
|
|
|
|
|
|
|
|
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
2,052
|
1,851
|
|
1,845
|
2,055
|
1,892
|
2,331
|
|
2,344
|
2,445
|
Net fee, commission and other income
|
3,363
|
4,049
|
|
3,096
|
3,149
|
3,446
|
3,952
|
|
2,957
|
3,096
|
Total income
|
5,415
|
5,900
|
|
4,941
|
5,204
|
5,338
|
6,283
|
|
5,301
|
5,541
|
Credit impairment releases/(charges)
|
797
|
(55)
|
|
(492)
|
(608)
|
(1,623)
|
(2,115)
|
|
(523)
|
(461)
|
Net operating income
|
6,212
|
5,845
|
|
4,449
|
4,596
|
3,715
|
4,168
|
|
4,778
|
5,080
|
Operating costs
|
(3,587)
|
(3,545)
|
|
(3,480)
|
(3,391)
|
(3,310)
|
(3,253)
|
|
(3,308)
|
(3,293)
|
UK bank levy
|
—
|
—
|
|
(299)
|
—
|
—
|
—
|
|
(226)
|
—
|
Litigation and conduct
|
(66)
|
(33)
|
|
(47)
|
(76)
|
(20)
|
(10)
|
|
(167)
|
(1,568)
|
Total operating expenses
|
(3,653)
|
(3,578)
|
|
(3,826)
|
(3,467)
|
(3,330)
|
(3,263)
|
|
(3,701)
|
(4,861)
|
Other net income/(expenses)
|
21
|
132
|
|
23
|
18
|
(26)
|
8
|
|
20
|
27
|
Profit before tax
|
2,580
|
2,399
|
|
646
|
1,147
|
359
|
913
|
|
1,097
|
246
|
Tax charge
|
(263)
|
(496)
|
|
(163)
|
(328)
|
(42)
|
(71)
|
|
(189)
|
(269)
|
Profit/(loss) after tax
|
2,317
|
1,903
|
|
483
|
819
|
317
|
842
|
|
908
|
(23)
|
Non-controlling interests
|
(15)
|
(4)
|
|
(37)
|
(4)
|
(21)
|
(16)
|
|
(42)
|
(4)
|
Other equity instrument holders
|
(194)
|
(195)
|
|
(226)
|
(204)
|
(206)
|
(221)
|
|
(185)
|
(265)
|
Attributable profit/(loss)
|
2,108
|
1,704
|
|
220
|
611
|
90
|
605
|
|
681
|
(292)
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity
|
18.1%
|
14.7%
|
|
1.8%
|
5.1%
|
0.7%
|
5.1%
|
|
5.9%
|
(2.4)%
|
Average tangible shareholders' equity (£bn)
|
46.5
|
46.5
|
|
47.6
|
48.3
|
50.2
|
47.0
|
|
46.4
|
48.4
|
Cost: income ratio
|
67%
|
61%
|
|
77%
|
67%
|
62%
|
52%
|
|
70%
|
88%
|
Loan loss rate (bps)
|
—
|
6
|
|
56
|
69
|
179
|
223
|
|
60
|
52
|
Basic earnings/(loss) per share
|
12.3p
|
9.9p
|
|
1.3p
|
3.5p
|
0.5p
|
3.5p
|
|
3.9p
|
(1.7)p
|
Basic weighted average number of shares (m)
|
17,140
|
17,293
|
|
17,300
|
17,298
|
17,294
|
17,278
|
|
17,200
|
17,192
|
Period end number of shares (m)
|
16,998
|
17,223
|
|
17,359
|
17,353
|
17,345
|
17,332
|
|
17,322
|
17,269
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet and capital management1
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
348.5
|
345.8
|
|
342.6
|
344.4
|
354.9
|
374.1
|
|
339.1
|
345.1
|
Loans and advances at amortised cost impairment coverage
ratio
|
1.8%
|
2.2%
|
|
2.4%
|
2.5%
|
2.5%
|
2.1%
|
|
1.8%
|
1.9%
|
Total assets
|
1,376.3
|
1,379.7
|
|
1,349.5
|
1,421.7
|
1,385.1
|
1,444.3
|
|
1,140.2
|
1,290.4
|
Deposits at amortised cost
|
500.9
|
498.8
|
|
481.0
|
494.6
|
466.9
|
470.7
|
|
415.8
|
420.6
|
Tangible net asset value per share
|
281p
|
267p
|
|
269p
|
275p
|
284p
|
284p
|
|
262p
|
274p
|
Common equity tier 1 ratio
|
15.1%
|
14.6%
|
|
15.1%
|
14.6%
|
14.2%
|
13.1%
|
|
13.8%
|
13.4%
|
Common equity tier 1 capital
|
46.2
|
45.9
|
|
46.3
|
45.5
|
45.4
|
42.5
|
|
40.8
|
41.9
|
Risk weighted assets
|
306.4
|
313.4
|
|
306.2
|
310.7
|
319.0
|
325.6
|
|
295.1
|
313.3
|
Average UK leverage ratio
|
4.8%
|
4.9%
|
|
5.0%
|
5.1%
|
4.7%
|
4.5%
|
|
4.5%
|
4.6%
|
Average UK leverage exposure
|
1,192.0
|
1,174.9
|
|
1,146.9
|
1,111.1
|
1,148.7
|
1,176.2
|
|
1,142.8
|
1,171.2
|
UK leverage ratio
|
5.0%
|
5.0%
|
|
5.3%
|
5.2%
|
5.2%
|
4.5%
|
|
5.1%
|
4.8%
|
UK leverage exposure
|
1,153.6
|
1,145.4
|
|
1,090.9
|
1,095.1
|
1,071.1
|
1,178.7
|
|
1,007.7
|
1,099.8
|
|
|
|
|
|
|
|
|
|
|
|
Funding and liquidity
|
|
|
|
|
|
|
|
|
|
|
Group liquidity pool (£bn)
|
291
|
290
|
|
266
|
327
|
298
|
237
|
|
211
|
226
|
Liquidity coverage ratio
|
162%
|
161%
|
|
162%
|
181%
|
186%
|
155%
|
|
160%
|
151%
|
Loan: deposit ratio
|
70%
|
69%
|
|
71%
|
70%
|
76%
|
79%
|
|
82%
|
82%
|
1
|
Refer to pages 54 to 60 for further information on how capital,
RWAs and leverage are calculated.
|
Quarterly Results by Business
Barclays UK
|
|
|
|
|
|
|
|
|
|
|
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
1,305
|
1,281
|
|
1,317
|
1,280
|
1,225
|
1,412
|
|
1,478
|
1,503
|
Net fee, commission and other income
|
318
|
295
|
|
309
|
270
|
242
|
292
|
|
481
|
343
|
Total income
|
1,623
|
1,576
|
|
1,626
|
1,550
|
1,467
|
1,704
|
|
1,959
|
1,846
|
Credit impairment releases/(charges)
|
520
|
(77)
|
|
(170)
|
(233)
|
(583)
|
(481)
|
|
(190)
|
(101)
|
Net operating income
|
2,143
|
1,499
|
|
1,456
|
1,317
|
884
|
1,223
|
|
1,769
|
1,745
|
Operating costs
|
(1,078)
|
(1,036)
|
|
(1,134)
|
(1,095)
|
(1,018)
|
(1,023)
|
|
(1,023)
|
(952)
|
UK bank levy
|
—
|
—
|
|
(50)
|
—
|
—
|
—
|
|
(41)
|
—
|
Litigation and conduct
|
(19)
|
(3)
|
|
4
|
(25)
|
(6)
|
(5)
|
|
(58)
|
(1,480)
|
Total operating expenses
|
(1,097)
|
(1,039)
|
|
(1,180)
|
(1,120)
|
(1,024)
|
(1,028)
|
|
(1,122)
|
(2,432)
|
Other net income/(expenses)
|
—
|
—
|
|
6
|
(1)
|
13
|
—
|
|
—
|
—
|
Profit/(loss) before tax
|
1,046
|
460
|
|
282
|
196
|
(127)
|
195
|
|
647
|
(687)
|
Attributable profit/(loss)
|
721
|
298
|
|
160
|
113
|
(123)
|
175
|
|
438
|
(907)
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances to customers at amortised cost
|
207.8
|
205.7
|
|
205.4
|
203.9
|
202.0
|
195.7
|
|
193.7
|
193.2
|
Total assets
|
311.2
|
309.1
|
|
289.1
|
294.5
|
287.6
|
267.5
|
|
257.8
|
257.9
|
Customer deposits at amortised cost
|
255.5
|
247.5
|
|
240.5
|
232.0
|
225.7
|
207.5
|
|
205.5
|
203.3
|
Loan: deposit ratio
|
87%
|
88%
|
|
89%
|
91%
|
92%
|
96%
|
|
96%
|
97%
|
Risk weighted assets
|
72.2
|
72.7
|
|
73.7
|
76.2
|
77.9
|
77.7
|
|
74.9
|
76.8
|
Period end allocated tangible equity
|
9.9
|
10.0
|
|
9.7
|
10.0
|
10.3
|
10.3
|
|
10.3
|
10.4
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
29.1%
|
12.0%
|
|
6.5%
|
4.5%
|
(4.8)%
|
6.9%
|
|
17.0%
|
(34.9)%
|
Average allocated tangible equity (£bn)
|
9.9
|
9.9
|
|
9.8
|
10.1
|
10.3
|
10.1
|
|
10.3
|
10.4
|
Cost: income ratio
|
68%
|
66%
|
|
73%
|
72%
|
70%
|
60%
|
|
57%
|
132%
|
Loan loss rate (bps)
|
—
|
14
|
|
31
|
43
|
111
|
96
|
|
38
|
20
|
Net interest margin
|
2.55%
|
2.54%
|
|
2.56%
|
2.51%
|
2.48%
|
2.91%
|
|
3.03%
|
3.10%
|
Analysis of Barclays UK
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Analysis of total income
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Personal Banking
|
987
|
923
|
|
895
|
833
|
826
|
968
|
|
1,064
|
1,035
|
Barclaycard Consumer UK
|
290
|
315
|
|
354
|
362
|
367
|
436
|
|
533
|
472
|
Business Banking
|
346
|
338
|
|
377
|
355
|
274
|
300
|
|
362
|
339
|
Total income
|
1,623
|
1,576
|
|
1,626
|
1,550
|
1,467
|
1,704
|
|
1,959
|
1,846
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of credit impairment releases/(charges)
|
|
|
|
|
|
|
|
|
|
|
Personal Banking
|
72
|
(22)
|
|
(68)
|
(48)
|
(130)
|
(134)
|
|
(71)
|
(36)
|
Barclaycard Consumer UK
|
434
|
(36)
|
|
(78)
|
(106)
|
(396)
|
(301)
|
|
(108)
|
(49)
|
Business Banking
|
14
|
(19)
|
|
(24)
|
(79)
|
(57)
|
(46)
|
|
(11)
|
(16)
|
Total credit impairment releases/(charges)
|
520
|
(77)
|
|
(170)
|
(233)
|
(583)
|
(481)
|
|
(190)
|
(101)
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of loans and advances to customers at amortised
cost
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Personal Banking
|
162.4
|
160.4
|
|
157.3
|
155.7
|
154.9
|
153.4
|
|
151.9
|
150.1
|
Barclaycard Consumer UK
|
8.8
|
8.7
|
|
9.9
|
10.7
|
11.5
|
13.6
|
|
14.7
|
14.9
|
Business Banking
|
36.6
|
36.6
|
|
38.2
|
37.5
|
35.6
|
28.7
|
|
27.1
|
28.2
|
Total loans and advances to customers at amortised
cost
|
207.8
|
205.7
|
|
205.4
|
203.9
|
202.0
|
195.7
|
|
193.7
|
193.2
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of customer deposits at amortised cost
|
|
|
|
|
|
|
|
|
|
|
Personal Banking
|
191.0
|
186.0
|
|
179.7
|
173.2
|
169.6
|
161.4
|
|
159.2
|
157.9
|
Barclaycard Consumer UK
|
0.1
|
0.1
|
|
0.1
|
0.1
|
0.1
|
—
|
|
—
|
—
|
Business Banking
|
64.4
|
61.4
|
|
60.7
|
58.7
|
56.0
|
46.1
|
|
46.3
|
45.4
|
Total customer deposits at amortised cost
|
255.5
|
247.5
|
|
240.5
|
232.0
|
225.7
|
207.5
|
|
205.5
|
203.3
|
Barclays International
|
|
|
|
|
|
|
|
|
|
|
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
811
|
748
|
|
614
|
823
|
847
|
998
|
|
965
|
1,059
|
Net trading income
|
1,455
|
1,934
|
|
1,372
|
1,528
|
1,660
|
2,360
|
|
929
|
1,110
|
Net fee, commission and other income
|
1,553
|
1,717
|
|
1,500
|
1,430
|
1,503
|
1,286
|
|
1,558
|
1,581
|
Total income
|
3,819
|
4,399
|
|
3,486
|
3,781
|
4,010
|
4,644
|
|
3,452
|
3,750
|
Credit impairment releases/(charges)
|
271
|
22
|
|
(291)
|
(370)
|
(1,010)
|
(1,609)
|
|
(329)
|
(352)
|
Net operating income
|
4,090
|
4,421
|
|
3,195
|
3,411
|
3,000
|
3,035
|
|
3,123
|
3,398
|
Operating costs
|
(2,168)
|
(2,438)
|
|
(2,133)
|
(2,227)
|
(2,186)
|
(2,219)
|
|
(2,240)
|
(2,282)
|
UK bank levy
|
—
|
—
|
|
(240)
|
—
|
—
|
—
|
|
(174)
|
—
|
Litigation and conduct
|
(63)
|
(21)
|
|
(9)
|
(28)
|
(11)
|
—
|
|
(86)
|
—
|
Total operating expenses
|
(2,231)
|
(2,459)
|
|
(2,382)
|
(2,255)
|
(2,197)
|
(2,219)
|
|
(2,500)
|
(2,282)
|
Other net income
|
13
|
9
|
|
9
|
9
|
4
|
6
|
|
17
|
21
|
Profit before tax
|
1,872
|
1,971
|
|
822
|
1,165
|
807
|
822
|
|
640
|
1,137
|
Attributable profit
|
1,267
|
1,431
|
|
441
|
782
|
468
|
529
|
|
397
|
799
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
121.9
|
123.5
|
|
122.7
|
128.0
|
138.1
|
167.0
|
|
132.8
|
138.1
|
Trading portfolio assets
|
147.1
|
131.1
|
|
127.7
|
122.3
|
109.5
|
101.6
|
|
113.3
|
119.4
|
Derivative financial instrument assets
|
255.4
|
269.4
|
|
301.8
|
295.9
|
306.8
|
341.5
|
|
228.9
|
286.0
|
Financial assets at fair value through the income
statement
|
190.4
|
197.5
|
|
170.7
|
178.2
|
154.3
|
188.4
|
|
128.4
|
158.0
|
Cash collateral and settlement balances
|
108.5
|
109.7
|
|
97.5
|
121.8
|
130.8
|
153.2
|
|
79.4
|
112.5
|
Other assets
|
223.5
|
221.7
|
|
221.4
|
261.7
|
236.3
|
201.5
|
|
178.6
|
195.6
|
Total assets
|
1,046.8
|
1,052.9
|
|
1,041.8
|
1,107.9
|
1,075.8
|
1,153.2
|
|
861.4
|
1,009.6
|
Deposits at amortised cost
|
245.4
|
251.2
|
|
240.5
|
262.4
|
241.2
|
263.3
|
|
210.0
|
217.6
|
Derivative financial instrument liabilities
|
246.9
|
260.2
|
|
300.4
|
293.3
|
307.6
|
338.8
|
|
228.9
|
283.3
|
Loan: deposit ratio
|
50%
|
49%
|
|
51%
|
49%
|
57%
|
63%
|
|
63%
|
63%
|
Risk weighted assets
|
223.2
|
230.0
|
|
222.3
|
224.7
|
231.2
|
237.9
|
|
209.2
|
223.1
|
Period end allocated tangible equity
|
31.8
|
32.7
|
|
30.2
|
30.5
|
31.6
|
33.1
|
|
29.6
|
31.4
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
15.6%
|
17.7%
|
|
5.8%
|
10.2%
|
5.6%
|
6.8%
|
|
5.1%
|
9.9%
|
Average allocated tangible equity (£bn)
|
32.4
|
32.3
|
|
30.5
|
30.6
|
33.5
|
31.2
|
|
30.9
|
32.2
|
Cost: income ratio
|
58%
|
56%
|
|
68%
|
60%
|
55%
|
48%
|
|
72%
|
61%
|
Loan loss rate (bps)
|
—
|
(7)
|
|
90
|
112
|
284
|
377
|
|
96
|
99
|
Net interest margin
|
3.96%
|
3.92%
|
|
3.41%
|
3.79%
|
3.43%
|
3.93%
|
|
4.29%
|
4.10%
|
Analysis of Barclays International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate and Investment Bank
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
370
|
270
|
|
110
|
305
|
334
|
335
|
|
248
|
339
|
Net trading income
|
1,494
|
1,917
|
|
1,397
|
1,535
|
1,812
|
2,231
|
|
951
|
1,126
|
Net fee, commission and other income
|
1,115
|
1,407
|
|
1,131
|
1,065
|
1,170
|
1,051
|
|
1,115
|
1,152
|
Total income
|
2,979
|
3,594
|
|
2,638
|
2,905
|
3,316
|
3,617
|
|
2,314
|
2,617
|
Credit impairment releases/(charges)
|
229
|
43
|
|
(52)
|
(187)
|
(596)
|
(724)
|
|
(30)
|
(31)
|
Net operating income
|
3,208
|
3,637
|
|
2,586
|
2,718
|
2,720
|
2,893
|
|
2,284
|
2,586
|
Operating costs
|
(1,623)
|
(1,886)
|
|
(1,603)
|
(1,716)
|
(1,680)
|
(1,690)
|
|
(1,691)
|
(1,712)
|
UK bank levy
|
—
|
—
|
|
(226)
|
—
|
—
|
—
|
|
(156)
|
—
|
Litigation and conduct
|
(1)
|
(1)
|
|
2
|
(3)
|
(3)
|
—
|
|
(79)
|
(4)
|
Total operating expenses
|
(1,624)
|
(1,887)
|
|
(1,827)
|
(1,719)
|
(1,683)
|
(1,690)
|
|
(1,926)
|
(1,716)
|
Other net income
|
—
|
1
|
|
2
|
1
|
3
|
—
|
|
1
|
12
|
Profit before tax
|
1,584
|
1,751
|
|
761
|
1,000
|
1,040
|
1,203
|
|
359
|
882
|
Attributable profit
|
1,049
|
1,263
|
|
413
|
627
|
694
|
820
|
|
193
|
609
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
91.0
|
94.3
|
|
92.4
|
96.8
|
104.9
|
128.2
|
|
92.0
|
95.8
|
Trading portfolio assets
|
147.0
|
130.9
|
|
127.5
|
122.2
|
109.3
|
101.5
|
|
113.3
|
119.3
|
Derivative financial instruments assets
|
255.3
|
269.4
|
|
301.7
|
295.9
|
306.7
|
341.4
|
|
228.8
|
286.0
|
Financial assets at fair value through the income
statement
|
190.3
|
197.3
|
|
170.4
|
177.9
|
153.7
|
187.8
|
|
127.7
|
157.3
|
Cash collateral and settlement balances
|
107.7
|
108.8
|
|
96.7
|
121.0
|
129.7
|
152.2
|
|
78.5
|
111.6
|
Other assets
|
192.5
|
190.8
|
|
194.9
|
228.9
|
205.5
|
171.4
|
|
155.3
|
171.5
|
Total assets
|
983.8
|
991.5
|
|
983.6
|
1,042.7
|
1,009.8
|
1,082.5
|
|
795.6
|
941.5
|
Deposits at amortised cost
|
178.2
|
185.2
|
|
175.2
|
195.6
|
173.9
|
198.4
|
|
146.2
|
152.1
|
Derivative financial instrument liabilities
|
246.8
|
260.2
|
|
300.3
|
293.2
|
307.6
|
338.7
|
|
228.9
|
283.2
|
Risk weighted assets
|
194.3
|
201.3
|
|
192.2
|
193.3
|
198.3
|
201.7
|
|
171.5
|
184.9
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
14.8%
|
17.9%
|
|
6.3%
|
9.5%
|
9.6%
|
12.5%
|
|
3.0%
|
9.1%
|
Average allocated tangible equity (£bn)
|
28.4
|
28.2
|
|
26.3
|
26.4
|
29.0
|
26.2
|
|
25.8
|
26.9
|
Cost: income ratio
|
55%
|
53%
|
|
69%
|
59%
|
51%
|
47%
|
|
83%
|
66%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of total income
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
FICC
|
895
|
1,204
|
|
812
|
1,000
|
1,468
|
1,858
|
|
726
|
816
|
Equities
|
777
|
932
|
|
542
|
691
|
674
|
564
|
|
409
|
494
|
Global Markets1
|
1,672
|
2,136
|
|
1,354
|
1,691
|
2,142
|
2,422
|
|
1,135
|
1,310
|
Advisory
|
218
|
163
|
|
232
|
90
|
84
|
155
|
|
202
|
221
|
Equity capital markets
|
226
|
243
|
|
104
|
122
|
185
|
62
|
|
56
|
86
|
Debt capital markets
|
429
|
453
|
|
418
|
398
|
463
|
418
|
|
322
|
381
|
Investment Banking fees1
|
873
|
859
|
|
754
|
610
|
732
|
635
|
|
580
|
688
|
Corporate lending
|
38
|
206
|
|
186
|
232
|
61
|
111
|
|
202
|
195
|
Transaction banking
|
396
|
393
|
|
344
|
372
|
381
|
449
|
|
397
|
424
|
Corporate
|
434
|
599
|
|
530
|
604
|
442
|
560
|
|
599
|
619
|
Total income
|
2,979
|
3,594
|
|
2,638
|
2,905
|
3,316
|
3,617
|
|
2,314
|
2,617
|
1
|
Previously labelled as “Markets” and “Banking
fees”.
|
Analysis of Barclays International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer, Cards and Payments
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
441
|
478
|
|
504
|
518
|
513
|
663
|
|
717
|
720
|
Net fee, commission, trading and other income
|
399
|
327
|
|
344
|
358
|
181
|
364
|
|
421
|
413
|
Total income
|
840
|
805
|
|
848
|
876
|
694
|
1,027
|
|
1,138
|
1,133
|
Credit impairment releases/(charges)
|
42
|
(21)
|
|
(239)
|
(183)
|
(414)
|
(885)
|
|
(299)
|
(321)
|
Net operating income
|
882
|
784
|
|
609
|
693
|
280
|
142
|
|
839
|
812
|
Operating costs
|
(545)
|
(552)
|
|
(530)
|
(511)
|
(506)
|
(529)
|
|
(549)
|
(570)
|
UK bank levy
|
—
|
—
|
|
(14)
|
—
|
—
|
—
|
|
(18)
|
—
|
Litigation and conduct
|
(62)
|
(20)
|
|
(11)
|
(25)
|
(8)
|
—
|
|
(7)
|
4
|
Total operating expenses
|
(607)
|
(572)
|
|
(555)
|
(536)
|
(514)
|
(529)
|
|
(574)
|
(566)
|
Other net income
|
13
|
8
|
|
7
|
8
|
1
|
6
|
|
16
|
9
|
Profit/(loss) before tax
|
288
|
220
|
|
61
|
165
|
(233)
|
(381)
|
|
281
|
255
|
Attributable profit/(loss)
|
218
|
168
|
|
28
|
155
|
(226)
|
(291)
|
|
204
|
190
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances at amortised cost
|
30.9
|
29.2
|
|
30.3
|
31.2
|
33.2
|
38.8
|
|
40.8
|
42.3
|
Total assets
|
63.0
|
61.4
|
|
58.2
|
65.2
|
66.0
|
70.7
|
|
65.8
|
68.1
|
Deposits at amortised cost
|
67.2
|
66.0
|
|
65.3
|
66.8
|
67.3
|
64.9
|
|
63.8
|
65.5
|
Risk weighted assets
|
29.0
|
28.8
|
|
30.1
|
31.4
|
32.9
|
36.2
|
|
37.7
|
38.2
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
21.8%
|
16.5%
|
|
2.7%
|
14.7%
|
(20.2)%
|
(23.5)%
|
|
15.9%
|
14.2%
|
Average allocated tangible equity (£bn)
|
4.0
|
4.1
|
|
4.2
|
4.2
|
4.5
|
5.0
|
|
5.1
|
5.3
|
Cost: income ratio
|
72%
|
71%
|
|
65%
|
61%
|
74%
|
52%
|
|
50%
|
50%
|
Loan loss rate (bps)
|
—
|
27
|
|
286
|
211
|
455
|
846
|
|
273
|
283
|
Head Office
|
|
|
|
|
|
|
|
|
|
|
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
(64)
|
(178)
|
|
(86)
|
(48)
|
(180)
|
(79)
|
|
(99)
|
(117)
|
Net fee, commission and other income
|
37
|
103
|
|
(85)
|
(79)
|
41
|
14
|
|
(11)
|
62
|
Total income
|
(27)
|
(75)
|
|
(171)
|
(127)
|
(139)
|
(65)
|
|
(110)
|
(55)
|
Credit impairment releases/(charges)
|
6
|
—
|
|
(31)
|
(5)
|
(30)
|
(25)
|
|
(4)
|
(8)
|
Net operating expenses
|
(21)
|
(75)
|
|
(202)
|
(132)
|
(169)
|
(90)
|
|
(114)
|
(63)
|
Operating costs
|
(341)
|
(71)
|
|
(213)
|
(69)
|
(106)
|
(11)
|
|
(45)
|
(59)
|
UK bank levy
|
—
|
—
|
|
(9)
|
—
|
—
|
—
|
|
(11)
|
—
|
Litigation and conduct
|
16
|
(9)
|
|
(42)
|
(23)
|
(3)
|
(5)
|
|
(23)
|
(88)
|
Total operating expenses
|
(325)
|
(80)
|
|
(264)
|
(92)
|
(109)
|
(16)
|
|
(79)
|
(147)
|
Other net income/(expenses)
|
8
|
123
|
|
8
|
10
|
(43)
|
2
|
|
3
|
6
|
Loss before tax
|
(338)
|
(32)
|
|
(458)
|
(214)
|
(321)
|
(104)
|
|
(190)
|
(204)
|
Attributable profit/(loss)
|
120
|
(25)
|
|
(381)
|
(284)
|
(255)
|
(99)
|
|
(154)
|
(184)
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Total assets
|
18.3
|
17.7
|
|
18.6
|
19.3
|
21.7
|
23.6
|
|
21.0
|
22.9
|
Risk weighted assets
|
11.1
|
10.7
|
|
10.2
|
9.8
|
9.9
|
10.0
|
|
11.0
|
13.4
|
Period end allocated tangible equity
|
5.9
|
3.3
|
|
6.8
|
7.1
|
7.4
|
6.0
|
|
5.6
|
5.5
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Average allocated tangible equity (£bn)
|
4.2
|
4.3
|
|
7.3
|
7.6
|
6.4
|
5.6
|
|
5.2
|
5.8
|
Performance Management
Margins and balances
|
|
|
|
|
|
|
|
Half year ended 30.06.21
|
Half year ended 30.06.20
|
|
Net interest income
|
Average customer assets
|
Net interest margin
|
Net interest income
|
Average customer assets
|
Net interest margin
|
|
£m
|
£m
|
%
|
£m
|
£m
|
%
|
Barclays UK
|
2,586
|
204,930
|
2.54
|
2,637
|
197,023
|
2.69
|
Barclays
International1,2
|
1,518
|
77,413
|
3.95
|
1,848
|
101,286
|
3.67
|
Total Barclays UK and Barclays International
|
4,104
|
282,343
|
2.93
|
4,485
|
298,309
|
3.02
|
Other3
|
(201)
|
|
|
(262)
|
|
|
Total Barclays Group
|
3,903
|
|
|
4,223
|
|
|
1
|
Barclays International margins include IEL balances within the
investment banking business.
|
2
|
Barclays amended the presentation of the premium paid for purchased
financial guarantees which are embedded in notes it issues directly
to the market in Q420 from net investment income to interest
expense within net interest income. Had the equivalent H120
interest expense been recognised in net interest income, the
Barclays International and Total Barclays UK and Barclays
International NIMs would have been 3.57% and 2.99%
respectively.
|
3
|
Other includes Head Office and non-lending related investment
banking businesses not included in Barclays International
margins.
|
The
Group’s combined product and equity structural hedge notional
as at 30 June 2021 was £198bn (June 2020: £174bn), with
an average duration of close to 3 years (2020: average duration 2.5
to 3 years). Group net interest income includes gross structural
hedge contributions of £689m (H120: £866m) and net
structural hedge contributions of £592m (H120: £555m).
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.
The
Group net interest margin decreased 9bps to 2.93%. Barclays UK net
interest margin decreased 15bps to 2.54% reflecting lower unsecured
lending balances and lower UK rates, partially offset by strong
mortgage retention at improved margins. Average customer assets
increased due to growth from government scheme lending and strong
mortgage growth. Barclays International net interest margin
increased 28bps to 3.95% driven by changes in product mix and lower
average customer assets.
Quarterly analysis for Barclays UK and Barclays
International
|
Net interest income
|
Average customer assets
|
Net interest margin
|
Three months ended 30.06.21
|
£m
|
£m
|
%
|
Barclays UK
|
1,305
|
205,168
|
2.55
|
Barclays
International1
|
763
|
77,330
|
3.96
|
Total Barclays UK and Barclays International
|
2,068
|
282,498
|
2.94
|
|
|
|
|
Three months ended 31.03.21
|
|
|
|
Barclays UK
|
1,281
|
204,663
|
2.54
|
Barclays
International1
|
755
|
78,230
|
3.92
|
Total Barclays UK and Barclays International
|
2,036
|
282,893
|
2.92
|
|
|
|
|
Three months ended 31.12.20
|
|
|
|
Barclays UK
|
1,317
|
204,315
|
2.56
|
Barclays
International1,2
|
696
|
81,312
|
3.41
|
Total Barclays UK and Barclays International
|
2,013
|
285,627
|
2.80
|
|
|
|
|
Three months ended 30.09.20
|
|
|
|
Barclays UK
|
1,280
|
203,089
|
2.51
|
Barclays
International1,2
|
838
|
88,032
|
3.79
|
Total Barclays UK and Barclays International
|
2,118
|
291,121
|
2.89
|
|
|
|
|
Three months ended 30.06.20
|
|
|
|
Barclays UK
|
1,225
|
199,039
|
2.48
|
Barclays
International1,2
|
868
|
101,706
|
3.43
|
Total Barclays UK and Barclays International
|
2,093
|
300,745
|
2.80
|
1
|
Barclays International margins include IEL balances within the
investment banking business.
|
2
|
The reclassification of expense of the premium paid for purchased
financial guarantees from net investment income to net interest
income was recognised in full in Q420 and resulted in a 0.48%
reduction on the Q420 Barclays International NIM and 0.14%
reduction on the Q420 Total Barclays UK and Barclays International
NIM. Had the equivalent impact been reflected in the respective
quarters, the Barclays International NIM would have been 3.33% in
Q220, 3.68% in Q320 and 3.77% in Q420. Total Barclays UK and
Barclays International NIMs would have been 2.77% in Q220, 2.86% in
Q320 and 2.91% in Q420 respectively.
|
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 Group are defined in
the Enterprise Risk Management Framework. The purpose of the
framework is to identify the principal risks of the Group, the
process by which the 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 2020 (pages 145 to 166) or online at home.barclays/annualreport.
Material existing and emerging risks
There
have been no significant changes to these principal risks or
previously identified material existing and emerging risks in the
period other than an update to the risk relating to the impact of
benchmark interest rates on the Group as a result of developments
relating to benchmark reform, as set out below.
Impact of benchmark interest rate reforms on the Group
For
several years, global regulators and central banks have been
driving international efforts to reform key benchmark interest
rates and indices, such as the London Interbank Offered Rate
(LIBOR), which are used to determine the amounts payable under a
wide range of transactions and make them more reliable and robust.
This has resulted in significant changes to the methodology and
operation of certain benchmarks and indices, the adoption of
alternative ‘risk-free’ reference rates (RFRs) and the
proposed discontinuation of certain reference rates (including
LIBOR), with further changes anticipated, including UK, EU and US
legislative proposals to deal with ‘tough legacy’
contracts that cannot convert into or cannot add fall-back RFRs.
The consequences of reform are unpredictable and may have an
adverse impact on any financial instruments linked to, or
referencing, any of these benchmark interest rates.
Uncertainty
as to the nature of such potential changes, the availability and/or
suitability of alternative RFRs, the participation of customers and
third-party market participants in the transition process and
associated challenges with respect to required documentation
changes, and other reforms may adversely affect a broad range of
transactions (including any securities, loans and derivatives which
use LIBOR to determine the amount of interest payable that are
included in the Group’s financial assets and liabilities)
that use these reference rates and indices and introduce a number
of risks for the Group, including, but not limited to:
●
|
Conduct risk: in undertaking actions to transition away from
using certain reference rates (such as LIBOR) to new alternative
RFRs, the Group faces conduct risks. These may lead to customer
complaints, regulatory sanctions or reputational impact if the
Group is considered to be (among other things) (i) undertaking
market activities that are manipulative or create a false or
misleading impression, (ii) misusing sensitive information or not
identifying or appropriately managing or mitigating conflicts of
interest, (iii) providing customers with inadequate advice,
misleading information, unsuitable products or unacceptable
service, (iv) not taking a consistent approach to remediation for
customers in similar circumstances, (v) unduly delaying the
communication and migration activities in relation to client
exposure, leaving them insufficient time to prepare, or (vi)
colluding or inappropriately sharing information with
competitors
|
●
|
Litigation risk: members of the Group may face legal
proceedings, regulatory investigations and/or other actions or
proceedings regarding (among other things) (i) the conduct risks
identified above, (ii) the interpretation and enforceability of
provisions in LIBOR-based contracts, and (iii) the Group’s
preparation and readiness for the replacement of LIBOR with
alternative RFRs
|
●
|
Financial risk: the valuation of certain of the
Group’s financial assets and liabilities may change.
Moreover, transitioning to alternative RFRs may impact the ability
of members of the Group to calculate and model amounts receivable
by them on certain financial assets and determine the amounts
payable on certain financial liabilities (such as debt securities
issued by them) because currently alternative RFRs (such as the
Sterling Overnight Index Average (SONIA) and the Secured Overnight
Financing Rate (SOFR)) are look-back rates whereas term rates (such
as LIBOR) allow borrowers to calculate at the start of any interest
period exactly how much is payable at the end of such interest
period. This may have a material adverse effect on the
Group’s cash flows
|
●
|
Pricing risk: changes to existing reference rates and
indices, discontinuation of any reference rate or indices and
transition to alternative RFRs may impact the pricing mechanisms
used by the Group on certain transactions
|
●
|
Operational risk: changes to existing reference rates and
indices, discontinuation of any reference rate or index and
transition to alternative RFRs may require changes to the
Group’s IT systems, trade reporting infrastructure,
operational processes, and controls. In addition, if any reference
rate or index (such as LIBOR) is no longer available to calculate
amounts payable, the Group may incur additional expenses in
amending documentation for new and existing transactions and/or
effecting the transition from the original reference rate or index
to a new reference rate or index
|
●
|
Accounting risk: an inability to apply hedge accounting in
accordance with IAS 39 could lead to increased volatility in the
Group’s financial results and performance
|
Any of
these factors may have a material adverse effect on the
Group’s business, results of operations, financial condition
and prospects.
For
further details on the impacts of benchmark interest rate reforms
on the Group, see Note 41 to Barclays PLC’s audited financial
statements for the year ended 31 December 2020 and Note
23.
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 2021. 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
2021.
Impairment
allowance under IFRS 9 considers both the drawn and the undrawn
counterparty exposure. For retail portfolios, the total impairment
allowance is allocated to the drawn exposure to the extent that the
allowance does not exceed the exposure, as ECL is not reported
separately. Any excess is reported on the liability side of the
balance sheet as a provision. For wholesale portfolios, the
impairment allowance on the undrawn exposure is reported on the
liability side of the balance sheet as a provision.
|
Gross exposure
|
|
Impairment allowance
|
Net exposure
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
As at 30.06.21
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
Barclays UK
|
158,587
|
23,576
|
2,715
|
184,878
|
|
313
|
1,035
|
944
|
2,292
|
182,586
|
Barclays International
|
23,286
|
2,886
|
1,760
|
27,932
|
|
575
|
781
|
1,004
|
2,360
|
25,572
|
Head Office
|
4,003
|
502
|
760
|
5,265
|
|
3
|
39
|
358
|
400
|
4,865
|
Total Barclays Group retail
|
185,876
|
26,964
|
5,235
|
218,075
|
|
891
|
1,855
|
2,306
|
5,052
|
213,023
|
Barclays UK
|
36,069
|
1,727
|
1,081
|
38,877
|
|
63
|
49
|
89
|
201
|
38,676
|
Barclays International
|
82,515
|
13,617
|
1,425
|
97,557
|
|
231
|
329
|
673
|
1,233
|
96,324
|
Head Office
|
522
|
3
|
32
|
557
|
|
—
|
—
|
31
|
31
|
526
|
Total Barclays Group wholesale1
|
119,106
|
15,347
|
2,538
|
136,991
|
|
294
|
378
|
793
|
1,465
|
135,526
|
Total loans and advances at amortised cost
|
304,982
|
42,311
|
7,773
|
355,066
|
|
1,185
|
2,233
|
3,099
|
6,517
|
348,549
|
Off-balance
sheet loan commitments and financial guarantee
contracts2
|
298,150
|
45,696
|
664
|
344,510
|
|
228
|
436
|
49
|
713
|
343,797
|
Total3
|
603,132
|
88,007
|
8,437
|
699,576
|
|
1,413
|
2,669
|
3,148
|
7,230
|
692,346
|
|
|
|
|
|
|
|
|
|
|
|
|
As at 30.06.21
|
|
Half year ended 30.06.21
|
|
|
Coverage ratio
|
|
Loan impairment release and loan loss rate
|
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Loan impairment release
|
Loan loss rate
|
|
|
%
|
%
|
%
|
%
|
|
£m
|
bps
|
|
Barclays UK
|
0.2
|
4.4
|
34.8
|
1.2
|
|
|
(259)
|
|
—
|
|
Barclays International
|
2.5
|
27.1
|
57.0
|
8.4
|
|
|
(19)
|
|
—
|
|
Head Office
|
0.1
|
7.8
|
47.1
|
7.6
|
|
|
(6)
|
|
—
|
|
Total Barclays Group retail
|
0.5
|
6.9
|
44.0
|
2.3
|
|
|
(284)
|
|
—
|
|
Barclays UK
|
0.2
|
2.8
|
8.2
|
0.5
|
|
|
(23)
|
|
—
|
|
Barclays International
|
0.3
|
2.4
|
47.2
|
1.3
|
|
|
(75)
|
|
—
|
|
Head Office
|
—
|
—
|
96.9
|
5.6
|
|
|
—
|
|
—
|
|
Total Barclays Group wholesale1
|
0.2
|
2.5
|
31.2
|
1.1
|
|
|
(98)
|
|
—
|
|
Total loans and advances at amortised cost
|
0.4
|
5.3
|
39.9
|
1.8
|
|
|
(382)
|
|
—
|
|
Off-balance
sheet loan commitments and financial guarantee
contracts2
|
0.1
|
1.0
|
7.4
|
0.2
|
|
|
(343)
|
|
|
|
Other
financial assets subject to impairment3
|
|
|
|
|
|
|
(17)
|
|
|
|
Total
|
0.2
|
3.0
|
37.3
|
1.0
|
|
|
(742)
|
|
|
|
1
|
Includes Wealth and Private Banking exposures measured on an
individual basis, and excludes Business Banking exposures that are
managed on a collective basis. The net impact is a difference in
total exposure of £7,796m of balances reported as wholesale
loans on page 29 in the Loans and advances at amortised cost by
product disclosure.
|
2
|
Excludes loan commitments and financial guarantees of £21bn
carried at fair value.
|
3
|
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
£186.0bn and impairment allowance of £114m. This
comprises £9m ECL on £185.8bn Stage 1 assets, £3m on
£58m Stage 2 fair value through other comprehensive income
assets, cash collateral and settlement balances and £102m on
£109m Stage 3 other assets.
|
|
Gross exposure
|
|
Impairment allowance
|
Net exposure
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
As at 31.12.20
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
Barclays UK
|
153,250
|
23,896
|
2,732
|
179,878
|
|
332
|
1,509
|
1,147
|
2,988
|
176,890
|
Barclays
International1
|
21,048
|
5,500
|
1,992
|
28,540
|
|
396
|
1,329
|
1,205
|
2,930
|
25,610
|
Head Office
|
4,267
|
720
|
844
|
5,831
|
|
4
|
51
|
380
|
435
|
5,396
|
Total Barclays Group retail
|
178,565
|
30,116
|
5,568
|
214,249
|
|
732
|
2,889
|
2,732
|
6,353
|
207,896
|
Barclays UK
|
31,918
|
4,325
|
1,126
|
37,369
|
|
13
|
129
|
116
|
258
|
37,111
|
Barclays
International1
|
79,911
|
16,565
|
2,270
|
98,746
|
|
288
|
546
|
859
|
1,693
|
97,053
|
Head Office
|
570
|
—
|
33
|
603
|
|
—
|
—
|
31
|
31
|
572
|
Total Barclays Group wholesale2
|
112,399
|
20,890
|
3,429
|
136,718
|
|
301
|
675
|
1,006
|
1,982
|
134,736
|
Total loans and advances at amortised cost
|
290,964
|
51,006
|
8,997
|
350,967
|
|
1,033
|
3,564
|
3,738
|
8,335
|
342,632
|
Off-balance
sheet loan commitments and financial guarantee
contracts3
|
289,939
|
52,891
|
2,330
|
345,160
|
|
256
|
758
|
50
|
1,064
|
344,096
|
Total4
|
580,903
|
103,897
|
11,327
|
696,127
|
|
1,289
|
4,322
|
3,788
|
9,399
|
686,728
|
|
|
|
|
|
|
|
|
|
|
|
|
As at 31.12.20
|
|
Year ended 31.12.20
|
|
|
Coverage ratio
|
|
Loan impairment charge and loan loss
rate5
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Loan impairment charge
|
Loan loss rate
|
|
|
%
|
%
|
%
|
%
|
|
£m
|
bps
|
|
Barclays UK
|
0.2
|
6.3
|
42.0
|
1.7
|
|
|
1,070
|
|
59
|
|
Barclays
International1
|
1.9
|
24.2
|
60.5
|
10.3
|
|
|
1,680
|
|
589
|
|
Head Office
|
0.1
|
7.1
|
45.0
|
7.5
|
|
|
91
|
|
156
|
|
Total Barclays Group retail
|
0.4
|
9.6
|
49.1
|
3.0
|
|
|
2,841
|
|
133
|
|
Barclays UK
|
—
|
3.0
|
10.3
|
0.7
|
|
|
154
|
|
41
|
|
Barclays
International1
|
0.4
|
3.3
|
37.8
|
1.7
|
|
|
914
|
|
93
|
|
Head Office
|
—
|
—
|
93.9
|
5.1
|
|
|
—
|
|
—
|
|
Total Barclays Group wholesale2
|
0.3
|
3.2
|
29.3
|
1.4
|
|
|
1,068
|
|
78
|
|
Total loans and advances at amortised cost
|
0.4
|
7.0
|
41.5
|
2.4
|
|
|
3,909
|
|
111
|
|
Off-balance
sheet loan commitments and financial guarantee
contracts3
|
0.1
|
1.4
|
2.1
|
0.3
|
|
|
776
|
|
|
|
Other
financial assets subject to impairment4
|
|
|
|
|
|
|
153
|
|
|
|
Total5
|
0.2
|
4.2
|
33.4
|
1.4
|
|
|
4,838
|
|
|
|
1
|
Private Banking have refined the methodology to classify £5bn
of their exposure between Wholesale and Retail during the
year.
|
2
|
Includes Wealth and Private Banking exposures measured on an
individual basis, and excludes Business Banking exposures that are
managed on a collective basis. The net impact is a difference in
total exposure of £7,551m of balances reported as wholesale
loans on page 29 in the Loans and advances at amortised cost by
product disclosure.
|
3
|
Excludes loan commitments and financial guarantees of £9.5bn
carried at fair value.
|
4
|
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
£180.3bn and impairment allowance of £165m. This
comprises £11m ECL on £175.7bn Stage 1 assets, £9m
on £4.4bn Stage 2 fair value through other comprehensive
income assets, other assets and cash collateral and settlement
balances and £145m on £154m Stage 3 other
assets.
|
5
|
The loan loss rate is 138 bps after applying the total impairment
charge of £4,838m.
|
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 30.06.21
|
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
|
144,103
|
17,991
|
1,666
|
823
|
20,480
|
2,235
|
166,818
|
Credit cards, unsecured loans and other retail lending
|
34,537
|
5,642
|
300
|
209
|
6,151
|
2,773
|
43,461
|
Wholesale loans
|
126,342
|
14,760
|
529
|
391
|
15,680
|
2,765
|
144,787
|
Total
|
304,982
|
38,393
|
2,495
|
1,423
|
42,311
|
7,773
|
355,066
|
|
|
|
|
|
|
|
|
Impairment allowance
|
|
|
|
|
|
|
|
Home loans
|
15
|
56
|
6
|
7
|
69
|
389
|
473
|
Credit cards, unsecured loans and other retail lending
|
834
|
1,547
|
100
|
120
|
1,767
|
1,852
|
4,453
|
Wholesale loans
|
336
|
381
|
5
|
11
|
397
|
858
|
1,591
|
Total
|
1,185
|
1,984
|
111
|
138
|
2,233
|
3,099
|
6,517
|
|
|
|
|
|
|
|
|
Net exposure
|
|
|
|
|
|
|
|
Home loans
|
144,088
|
17,935
|
1,660
|
816
|
20,411
|
1,846
|
166,345
|
Credit cards, unsecured loans and other retail lending
|
33,703
|
4,095
|
200
|
89
|
4,384
|
921
|
39,008
|
Wholesale loans
|
126,006
|
14,379
|
524
|
380
|
15,283
|
1,907
|
143,196
|
Total
|
303,797
|
36,409
|
2,384
|
1,285
|
40,078
|
4,674
|
348,549
|
|
|
|
|
|
|
|
|
Coverage ratio
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
Home loans
|
—
|
0.3
|
0.4
|
0.9
|
0.3
|
17.4
|
0.3
|
Credit cards, unsecured loans and other retail lending
|
2.4
|
27.4
|
33.3
|
57.4
|
28.7
|
66.8
|
10.2
|
Wholesale loans
|
0.3
|
2.6
|
0.9
|
2.8
|
2.5
|
31.0
|
1.1
|
Total
|
0.4
|
5.2
|
4.4
|
9.7
|
5.3
|
39.9
|
1.8
|
|
|
|
|
|
|
|
|
As at 31.12.20
|
|
|
|
|
|
|
|
Gross exposure
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Home loans
|
138,639
|
16,651
|
1,785
|
876
|
19,312
|
2,234
|
160,185
|
Credit cards, unsecured loans and other retail lending
|
33,021
|
9,470
|
544
|
306
|
10,320
|
3,172
|
46,513
|
Wholesale loans
|
119,304
|
19,501
|
1,097
|
776
|
21,374
|
3,591
|
144,269
|
Total
|
290,964
|
45,622
|
3,426
|
1,958
|
51,006
|
8,997
|
350,967
|
|
|
|
|
|
|
|
|
Impairment allowance
|
|
|
|
|
|
|
|
Home Loans
|
33
|
57
|
13
|
14
|
84
|
421
|
538
|
Credit cards, unsecured loans and other retail lending
|
680
|
2,382
|
180
|
207
|
2,769
|
2,251
|
5,700
|
Wholesale Loans
|
320
|
650
|
50
|
11
|
711
|
1,066
|
2,097
|
Total
|
1,033
|
3,089
|
243
|
232
|
3,564
|
3,738
|
8,335
|
|
|
|
|
|
|
|
|
Net exposure
|
|
|
|
|
|
|
|
Home loans
|
138,606
|
16,594
|
1,772
|
862
|
19,228
|
1,813
|
159,647
|
Credit cards, unsecured loans and other retail lending
|
32,341
|
7,088
|
364
|
99
|
7,551
|
921
|
40,813
|
Wholesale loans
|
118,984
|
18,851
|
1,047
|
765
|
20,663
|
2,525
|
142,172
|
Total
|
289,931
|
42,533
|
3,183
|
1,726
|
47,442
|
5,259
|
342,632
|
|
|
|
|
|
|
|
|
Coverage ratio
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
Home loans
|
—
|
0.3
|
0.7
|
1.6
|
0.4
|
18.8
|
0.3
|
Credit cards, unsecured loans and other retail lending
|
2.1
|
25.2
|
33.1
|
67.6
|
26.8
|
71.0
|
12.3
|
Wholesale loans
|
0.3
|
3.3
|
4.6
|
1.4
|
3.3
|
29.7
|
1.5
|
Total
|
0.4
|
6.8
|
7.1
|
11.8
|
7.0
|
41.5
|
2.4
|
Loans and advances at amortised cost by selected
sectors
The
table below presents a breakdown of loans and advances at amortised
cost and the impairment allowance, with gross exposure and stage
allocation for selected industry sectors within the wholesale loans
portfolio. The industry sectors have been selected based upon the
level of management focus they have received following the onset of
the COVID-19 pandemic.
The
gross loans and advances to selected sectors have decreased over
the year driven by repayments and lower drawdowns. The reduction in
provisions is informed by the improved macroeconomic outlook used
in the Q221 scenario refresh, partially offset by management
judgments to reflect the risk of uncertainty still prevailing
within these sectors. The wholesale portfolio also benefits from a
hedge protection programme that enables effective risk management
against systemic losses. An additional £0.1bn (December 2020:
£0.1bn) impairment allowance has been applied to the undrawn
exposures not included in the table below.
|
Gross exposure
|
|
Impairment allowance
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
As at 30.06.21
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
Air travel
|
305
|
322
|
21
|
648
|
|
3
|
13
|
18
|
34
|
Hospitality and leisure
|
4,019
|
1,907
|
298
|
6,224
|
|
48
|
68
|
49
|
165
|
Oil and gas
|
1,877
|
465
|
234
|
2,576
|
|
14
|
12
|
128
|
154
|
Retail
|
4,089
|
962
|
148
|
5,199
|
|
63
|
30
|
44
|
137
|
Shipping
|
485
|
220
|
12
|
717
|
|
5
|
35
|
—
|
40
|
Transportation
|
1,768
|
161
|
102
|
2,031
|
|
20
|
4
|
37
|
61
|
Total
|
12,543
|
4,037
|
815
|
17,395
|
|
153
|
162
|
276
|
591
|
Total of Wholesale exposures
|
10%
|
26%
|
29%
|
12%
|
|
45%
|
41%
|
32%
|
37%
|
|
|
|
|
|
|
|
|
|
|
|
Gross exposure
|
|
Impairment allowance
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
As at 31.12.20
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
Air travel
|
367
|
525
|
56
|
948
|
|
9
|
27
|
23
|
59
|
Hospitality and leisure
|
4,440
|
2,387
|
313
|
7,140
|
|
53
|
115
|
61
|
229
|
Oil and gas
|
1,754
|
854
|
465
|
3,073
|
|
31
|
27
|
140
|
198
|
Retail
|
3,907
|
1,153
|
283
|
5,343
|
|
78
|
51
|
108
|
237
|
Shipping
|
308
|
389
|
12
|
709
|
|
2
|
30
|
1
|
33
|
Transportation
|
1,148
|
253
|
125
|
1,526
|
|
19
|
10
|
57
|
86
|
Total
|
11,924
|
5,561
|
1,254
|
18,739
|
|
192
|
260
|
390
|
842
|
Total of Wholesale exposures
|
10%
|
26%
|
35%
|
13%
|
|
60%
|
37%
|
37%
|
40%
|
The
coverage ratio for selected sectors has decreased from 4.5% as at
31 December 2020 to 3.4% as at 30 June 2021.
Exposure
to UK commercial real estate of £9.4bn, excluding government
backed schemes, was in line with 31 December 2020 (£10.0bn).
Coverage decreased from 0.98% to 0.61% in the period.
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 ECL, lifetime ECL and
credit-impaired is included in the Barclays PLC Annual Report 2020
on page 296. Transfers between stages in the table have been
reflected as if they had taken place at the beginning of the year.
The movements are measured over a 6-month period.
Loans and advances at amortised cost
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Gross exposure
|
ECL
|
Gross exposure
|
ECL
|
Gross exposure
|
ECL
|
Gross exposure
|
ECL
|
Home loans
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
As at 1 January 2021
|
138,639
|
33
|
19,312
|
84
|
2,234
|
421
|
160,185
|
538
|
Transfers from Stage 1 to Stage 2
|
(6,369)
|
(2)
|
6,369
|
2
|
—
|
—
|
—
|
—
|
Transfers from Stage 2 to Stage 1
|
3,615
|
21
|
(3,615)
|
(21)
|
—
|
—
|
—
|
—
|
Transfers to Stage 3
|
(160)
|
—
|
(337)
|
(7)
|
497
|
7
|
—
|
—
|
Transfers from Stage 3
|
21
|
—
|
119
|
3
|
(140)
|
(3)
|
—
|
—
|
Business activity in the year
|
19,231
|
2
|
380
|
1
|
—
|
—
|
19,611
|
3
|
Changes
to models used for calculation1
|
—
|
—
|
—
|
(4)
|
—
|
38
|
—
|
34
|
Net drawdowns, repayments, net re-measurement and movement due to
exposure and risk parameter changes
|
(4,670)
|
(38)
|
(667)
|
13
|
(124)
|
(54)
|
(5,461)
|
(79)
|
Final repayments
|
(6,204)
|
(1)
|
(1,081)
|
(2)
|
(220)
|
(8)
|
(7,505)
|
(11)
|
Disposals
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
Write-offs2
|
—
|
—
|
—
|
—
|
(12)
|
(12)
|
(12)
|
(12)
|
As at 30 June 20213
|
144,103
|
15
|
20,480
|
69
|
2,235
|
389
|
166,818
|
473
|
|
|
|
|
|
|
|
|
|
Credit cards, unsecured loans and other retail lending
|
As at 1 January 2021
|
33,021
|
680
|
10,320
|
2,769
|
3,172
|
2,251
|
46,513
|
5,700
|
Transfers from Stage 1 to Stage 2
|
(1,590)
|
(72)
|
1,590
|
72
|
—
|
—
|
—
|
—
|
Transfers
from Stage 2 to Stage 1
|
4,376
|
1,080
|
(4,376)
|
(1,080)
|
—
|
—
|
—
|
—
|
Transfers to Stage 3
|
(264)
|
(12)
|
(572)
|
(282)
|
836
|
294
|
—
|
—
|
Transfers from Stage 3
|
30
|
25
|
38
|
14
|
(68)
|
(39)
|
—
|
—
|
Business activity in the year
|
3,855
|
50
|
58
|
14
|
31
|
8
|
3,944
|
72
|
Changes
to models used for calculation1
|
—
|
(5)
|
—
|
(33)
|
—
|
14
|
—
|
(24)
|
Net
drawdowns, repayments, net re-measurement and movement due to
exposure and risk parameter changes4
|
(3,134)
|
(866)
|
(808)
|
310
|
(123)
|
282
|
(4,065)
|
(274)
|
Final repayments
|
(1,757)
|
(46)
|
(99)
|
(17)
|
(140)
|
(50)
|
(1,996)
|
(113)
|
Disposals5
|
—
|
—
|
—
|
—
|
(101)
|
(74)
|
(101)
|
(74)
|
Write-offs2
|
—
|
—
|
—
|
—
|
(834)
|
(834)
|
(834)
|
(834)
|
As at 30 June 20213
|
34,537
|
834
|
6,151
|
1,767
|
2,773
|
1,852
|
43,461
|
4,453
|
1
|
Changes to models used for calculation include a £34m movement
in Home loans, £24m in Credit cards, unsecured loans and other
retail lending and £36m in Wholesale loans. These reflect
methodology changes made during the year. Barclays continually
review the output of models to determine accuracy of the ECL
calculation including review of model monitoring, external
benchmarking and experience of model operation over an extended
period of time. This ensures that the models used continue to
reflect the risks inherent across the businesses.
|
2
|
In H121, gross write-offs amounted to £1,001m (H120:
£953m) and post write-off recoveries amounted to £31m
(H120: £15m). Net write-offs represent gross write-offs less
post write-off recoveries and amounted to £970m (H120:
£938m).
|
3
|
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
£186.0bn (December 2020: £180.3bn) and impairment
allowance of £114m (December 2020: £165m). This comprises
£9m ECL (December 2020: £11m) on £185.8bn stage 1
assets (December 2020: £175.7bn), £3m (December 2020:
£9m) on £58m stage 2 fair value through other
comprehensive income assets, other assets and cash collateral and
settlement balances (December 2020: £4.4bn) and £102m
(December 2020: £145m) on £109m stage 3 other assets
(December 2020: £154m).
|
4
|
Transfers and risk parameter changes include a £0.3bn net
release in ECL arising from a reclassification of £2.2bn gross
loans and advances from Stage 2 to Stage 1 in Credit cards,
unsecured loans and other retail lending. The reclassification
followed a review of back-testing of results which indicated that
accuracy of origination probability of default characteristics
require management adjustments to correct and was first established
in Q220.
|
5
|
The £101m disposals reported within Credit cards, unsecured
loans and other retail lending portfolio relates to debt sales
undertaken during the year. The £1.7bn disposal reported
within Wholesale loans includes a sale of £0.7bn debt
securities as part of Group Treasury Operations and a £1.0bn
sale of Barclays Asset Finance.
|
Loans and advances at amortised cost
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Gross exposure
|
ECL
|
Gross exposure
|
ECL
|
Gross exposure
|
ECL
|
Gross exposure
|
ECL
|
Wholesale loans
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
As at 1 January 2021
|
119,304
|
320
|
21,374
|
711
|
3,591
|
1,066
|
144,269
|
2,097
|
Transfers from Stage 1 to Stage 2
|
(4,636)
|
(12)
|
4,636
|
12
|
—
|
—
|
—
|
—
|
Transfers from Stage 2 to Stage 1
|
8,410
|
188
|
(8,410)
|
(188)
|
—
|
—
|
—
|
—
|
Transfers to Stage 3
|
(249)
|
(2)
|
(226)
|
(17)
|
475
|
19
|
—
|
—
|
Transfers from Stage 3
|
515
|
14
|
376
|
13
|
(891)
|
(27)
|
—
|
—
|
Business activity in the year
|
23,266
|
35
|
1,181
|
30
|
191
|
22
|
24,638
|
87
|
Changes
to models used for calculation1
|
—
|
(7)
|
—
|
(29)
|
—
|
—
|
—
|
(36)
|
Net drawdowns, repayments, net re-measurement and movement due to
exposure and risk parameter changes
|
81
|
(153)
|
(47)
|
(37)
|
(185)
|
(1)
|
(151)
|
(191)
|
Final repayments
|
(18,854)
|
(39)
|
(3,042)
|
(95)
|
(203)
|
(33)
|
(22,099)
|
(167)
|
Disposals2
|
(1,495)
|
(8)
|
(162)
|
(3)
|
(58)
|
(33)
|
(1,715)
|
(44)
|
Write-offs3
|
—
|
—
|
—
|
—
|
(155)
|
(155)
|
(155)
|
(155)
|
As at 30 June 20214
|
126,342
|
336
|
15,680
|
397
|
2,765
|
858
|
144,787
|
1,591
|
|
|
|
|
|
|
|
|
|
Reconciliation of ECL movement to impairment charge/(release) for
the period
|
£m
|
Home loans
|
|
|
|
|
|
|
|
(53)
|
Credit cards, unsecured loans and other retail lending
|
|
(339)
|
Wholesale loans
|
|
(307)
|
ECL movement excluding assets derecognised due to disposals and
write-offs
|
|
(699)
|
Recoveries
and reimbursements5
|
|
185
|
Exchange
and other adjustments6
|
|
132
|
Impairment charge on loan commitments and other financial
guarantees
|
|
(343)
|
Impairment
charge on other financial assets4
|
|
(17)
|
Income statement release for the period
|
|
|
|
|
|
|
|
(742)
|
1
|
Changes to models used for calculation include a £34m movement
in Home Loans, £24m in Credit cards, unsecured loans and other
retail lending and £36m in Wholesale loans. These reflect
methodology changes made during the year. Barclays continually
review the output of models to determine accuracy of the ECL
calculation including review of model monitoring, external
benchmarking and experience of model operation over an extended
period of time. This ensures that the models used continue to
reflect the risks inherent across the businesses.
|
2
|
The £101m disposals reported within Credit cards, unsecured
loans and other retail lending portfolio relates to debt sales
undertaken during the year. The £1.7bn disposal reported
within Wholesale loans includes a sale of £0.7bn debt
securities as part of Group Treasury Operations and a £1.0bn
sale of Barclays Asset Finance.
|
3
|
In H121, gross write-offs amounted to £1,001m (H120:
£953m) and post write-off recoveries amounted to £31m
(H120: £15m). Net write-offs represent gross write-offs less
post write-off recoveries and amounted to £970m (H120:
£938m).
|
4
|
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
£186.0bn (December 2020: £180.3bn) and impairment
allowance of £114m (December 2020: £165m). This comprises
£9m ECL (December 2020: £11m) on £185.8bn stage 1
assets (December 2020: £175.7bn), £3m (December 2020:
£9m) on £58m stage 2 fair value through other
comprehensive income assets, other assets and cash collateral and
settlement balances (December 2020: £4.4bn) and £102m
(December 2020: £145m) on £109m stage 3 other assets
(December 2020: £154m).
|
5
|
Recoveries and reimbursements includes a net loss in relation to
reimbursements from financial guarantee contracts held with third
parties of £216m (H120 gain: £279m) and post write off
recoveries of £31m (H120: £15m).
|
6
|
Includes foreign exchange and interest and fees in
suspense.
|
Loan commitments and financial guarantees
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
Gross exposure
|
ECL
|
Gross exposure
|
ECL
|
Gross exposure
|
ECL
|
Gross exposure
|
ECL
|
Home loans
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
As at 1 January 2021
|
11,861
|
—
|
516
|
—
|
5
|
—
|
12,382
|
—
|
Net transfers between stages
|
(74)
|
—
|
71
|
—
|
3
|
—
|
—
|
—
|
Business activity in the year
|
6,287
|
—
|
1
|
—
|
—
|
—
|
6,288
|
—
|
Net drawdowns, repayments, net re-measurement and movement due to
exposure and risk parameter changes
|
(7,397)
|
—
|
(17)
|
—
|
(2)
|
—
|
(7,416)
|
—
|
Limit management and final repayments
|
(238)
|
—
|
(22)
|
—
|
(3)
|
—
|
(263)
|
—
|
As at 30 June 2021
|
10,439
|
—
|
549
|
—
|
3
|
—
|
10,991
|
—
|
|
|
|
|
|
|
|
|
|
Credit cards, unsecured loans and other retail lending
|
As at 1 January 2021
|
114,371
|
55
|
12,117
|
305
|
229
|
23
|
126,717
|
383
|
Net transfers between stages
|
5,784
|
217
|
(6,081)
|
(212)
|
297
|
(5)
|
—
|
—
|
Business activity in the year
|
3,378
|
1
|
32
|
1
|
1
|
1
|
3,411
|
3
|
Net drawdowns, repayments, net re-measurement and movement due to
exposure and risk parameter changes
|
(1,005)
|
(215)
|
114
|
63
|
(248)
|
4
|
(1,139)
|
(148)
|
Limit management and final repayments
|
(4,941)
|
(4)
|
(398)
|
(5)
|
(57)
|
(3)
|
(5,396)
|
(12)
|
As at 30 June 2021
|
117,587
|
54
|
5,784
|
152
|
222
|
20
|
123,593
|
226
|
|
|
|
|
|
|
|
|
|
Wholesale loans
|
|
|
|
|
|
|
|
|
As at 1 January 2021
|
163,707
|
201
|
40,258
|
453
|
2,096
|
27
|
206,061
|
681
|
Net transfers between stages
|
682
|
116
|
504
|
(112)
|
(1,186)
|
(4)
|
—
|
—
|
Business activity in the year
|
37,211
|
28
|
2,915
|
89
|
12
|
9
|
40,138
|
126
|
Net drawdowns, repayments, net re-measurement and movement due to
exposure and risk parameter changes
|
1,603
|
(146)
|
680
|
(63)
|
(28)
|
2
|
2,255
|
(207)
|
Limit management and final repayments
|
(33,079)
|
(25)
|
(4,994)
|
(83)
|
(455)
|
(5)
|
(38,528)
|
(113)
|
As at 30 June 2021
|
170,124
|
174
|
39,363
|
284
|
439
|
29
|
209,926
|
487
|
Management adjustments to models for impairment
Management
adjustments to impairment models are made in the ordinary course of
business in order to reflect changes in policy or correct model
performance issues identified through model monitoring. These
adjustments remain in place until they are incorporated into future
model development and are then retired. In addition, they may also
be made in response to circumstances or uncertainty at the period
end and this is particularly true of the ongoing COVID-19
pandemic.
Total
management adjustments to impairment allowance are presented by
product below.
Overview of management adjustments to
models for impairment allowance1
|
As at 30.06.21
|
As at 31.12.20
|
|
Management adjustments to impairment allowances
|
Proportion of total impairment allowances
|
Management adjustments to impairment allowances
|
Proportion of total impairment allowances
|
|
£m
|
%
|
£m
|
%
|
Home loans
|
83
|
17.5
|
131
|
24.3
|
Credit cards, unsecured loans and other retail lending
|
1,145
|
24.5
|
1,234
|
20.3
|
Wholesale loans
|
643
|
30.9
|
23
|
0.8
|
Total
|
1,871
|
25.9
|
1,388
|
14.8
|
Management adjustments to models for
impairment allowance1
|
Impairment allowance pre management
adjustments2
|
Economic uncertainty adjustments
|
Other adjustments
|
Total impairment allowance
|
As at 30.06.21
|
£m
|
£m
|
£m
|
£m
|
Home loans
|
390
|
41
|
42
|
473
|
Credit cards, unsecured loans and other retail lending
|
3,534
|
1,398
|
(253)
|
4,679
|
Wholesale loans
|
1,435
|
651
|
(8)
|
2,078
|
Total
|
5,359
|
2,090
|
(219)
|
7,230
|
|
|
|
|
|
As at 31.12.20
|
|
|
|
|
Home loans
|
407
|
21
|
110
|
538
|
Credit cards, unsecured loans and other retail lending
|
4,849
|
1,625
|
(391)
|
6,083
|
Wholesale loans
|
2,755
|
421
|
(398)
|
2,778
|
Total
|
8,011
|
2,067
|
(679)
|
9,399
|
1
|
Positive values reflect an increase in impairment
allowance.
|
2
|
Includes £4.3bn (December 2020: £6.8bn) of modelled ECL,
£0.8bn (December 2020: £0.9bn) of individually assessed
impairments and £0.3bn (December 2020: £0.3bn) ECL from
non-modelled exposures.
|
Economic uncertainty adjustments
The
COVID-19 pandemic has impacted the global economy since early 2020
and macroeconomic forecasts indicate longer-term impacts that will
result in higher unemployment levels and customer and client
stress. However, to date, little real credit deterioration has
occurred, largely as a result of government and other support
measures. Observed 30-day arrears rates have reduced in US cards
1.6% (December 2020: 2.5%; December 2019: 2.7%) and in UK cards
1.4% (December 2020: 1.7%; December 2019: 1.7%) due to payment
holidays granted to customers impacted by COVID-19 which reduced
the delinquency entrance rate and overall flow through delinquency.
However, uncertainty remains as government and other support
measures taper down as to whether these schemes have either averted
or delayed credit losses.
In
order to address this uncertainty, adjustments to the modelled
provisions were made in 2020. COVID-19 related economic uncertainty
adjustments of £2.1bn (December 2020: £2.1bn) continue to
be recognised, specifically to address whether support measures
have averted or delayed credit losses. However, within this, the
approach has been refined and uncertainty is now captured in two
distinct ways: firstly, the identification of specific customers
and clients who may be more vulnerable to the withdrawal of relief
and secondly, macroeconomic and risk parameter uncertainties which
are applied at a portfolio level.
A
summary of the adjustments is provided below:
●
|
A
£1.2bn adjustment has been applied to customers and clients
considered potentially vulnerable to the withdrawal of government
and other support schemes. In US consumer card portfolios, the
populations identified are those who have higher potential risk
indicators and in the UK we have specifically considered the impact
of furlough schemes ending (equivalent to UK unemployment
increasing to 7.2%). In wholesale portfolios, the populations
identified are specific clients who may exhibit greater cross
default risk between COVID-19 and other financing exposures,
including clients with Bounce Back Loans in Business Banking, and
those corporate sectors deemed more vulnerable to the economic
impacts of COVID-19. This adjustment is split between credit cards
and unsecured loans, £0.9bn, and wholesale loans,
£0.3bn
|
●
|
Expert
judgement has been used to adjust the probability of default at
portfolio level to pre-COVID-19 levels to reflect the impact of
temporary support measures on underlying customer and client
behaviour. Following a refinement to methodology, this has reduced
to £0.5bn from £0.7bn in December 2020. A £(0.1)bn
PMA to recognise government guarantees remains in
place
|
●
|
Macroeconomic
variables which may be temporarily influenced by support measures
have been adjusted at a portfolio level enabling the model to
consume the economic stress. This is reduced to £0.5bn from
£1.2bn at December 2020 as management judgements have been
refined towards potentially vulnerable customers and clients as the
pandemic evolves
|
Other adjustments
Home loans: The low average LTV nature of the UK Home Loans
portfolio means that modelled ECL estimates are low in all but the
most severe economic scenarios. An adjustment is held to maintain
an appropriate level of ECL.
Credit cards, unsecured loans and other retail lending: This
materially relates to a net release in ECL due to reclassification
of loans and advances from Stage 2 to Stage 1 in credit cards and
unsecured loans. The reclassification followed a review of
back-testing of results which indicated that the accuracy of
origination probability of default characteristics requires
management adjustments to correct and was first established in
Q220.
Wholesale loans: Represents the net of adjustments for
Business Banking and Investment Bank for model inaccuracies
informed by back-testing. An adjustment to offset modelled ECL
output in the Investment Bank to limit excessive ECL sensitivity to
the macroeconomic variable for Federal Tax Receipts in place at
December 2020 is materially reduced due to the Q221 scenario
refresh.
Measurement uncertainty
The
Group uses a five-scenario model to calculate ECL. An external
consensus forecast is assembled from key sources, including HM
Treasury (short and medium-term forecasts), Bloomberg (based on
median of economic forecasts) and the Urban Land Institute (for US
House Prices), 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
broadly similar severity to Barclays’ internal stress tests
and stress scenarios provided by regulators whilst also considering
IFRS 9 specific sensitivities and non-linearity. Downside 2 is
benchmarked to the Bank of England’s stress 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
reflect upside risks to the Baseline scenario to the extent that is
broadly consistent with recent favourable benchmark scenarios. All
scenarios are regenerated at a minimum semi-annually. 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. The upside and downside shocks are designed to evolve
over a five-year stress horizon, with all five scenarios converging
to a steady state after approximately eight years.
Macroeconomic
indicators were refreshed in Q221, with key drivers for the
baseline scenario more optimistic than Q420, resulting in a net ECL
provision release. In the Baseline scenario, UK GDP returns to the
pre-pandemic level by mid-2022 with peak UK unemployment of just
over 6% in Q421. In the Upside 2 scenario, effective fiscal
stimulus measures, including public investments in infrastructure
and skills, provide a boost to demand and confidence, which in turn
leads to economic activity in almost all advanced economies
returning to the pre-COVID-19 pandemic levels by the end of 2021.
Unemployment levels decline back below 5% by H222 in the UK, and
below 4% by early 2022 in the US. In the Downside 2 scenario supply and
distribution issues slow the vaccination process and the emergence
of new virus variants that are not susceptible to the existing
vaccines fuels the outbreak again resulting in full national
lockdowns in Q321. This leads to significant falls in GDP in Q321
and UK and US unemployment reaching c.10% and 12%
respectively.
Although
the macroeconomic outlook has improved, the Group’s view on
uncertainty remains unchanged, believing potential credit
deterioration could be seen once government support is removed,
particularly in vulnerable areas of the portfolio. In response,
economic uncertainty PMAs remained relatively stable at
c.£2.1bn. For further details see page 34.
Limited
defaults have been observed to date in response to the COVID-19
pandemic, partly as a result of government and bank support
measures. However, such support measures are scheduled to taper
down from Q321 bringing with it uncertainty. Despite improvement in
macroeconomic variables in the period, unemployment remains at
elevated levels but portfolios are yet to respond, and may not do
so until support measures fall away.
The
methodology for estimating probability weights for each of the
scenarios involves a comparison of the distribution of key
historical UK and US macroeconomic variables against the forecast
paths of the 5 scenarios. The range of forecast paths generated in
the calculation of the weights at 30 June 2021 is slightly narrower
than 31 December 2020 due to lower levels of uncertainty. The
Upside 2 and Downside 2 scenarios are therefore nearer the tails of
the distribution than previously resulting in lower weights. See
page 39 for probability weightings used at H121.
The
tables below show the key consensus macroeconomic variables used in
the scenarios (3-year annual paths), the probability weights
applied to each scenario and the macroeconomic variables by
scenario using ‘specific bases’ i.e. the most extreme
position of each variable in the context of the scenario, for
example, the highest unemployment for downside scenarios and the
lowest unemployment for upside scenarios. The 5-year average table
provides additional transparency.
Baseline average macroeconomic variables used in the calculation of
ECL
|
|
2021
|
2022
|
2023
|
As at 30.06.21
|
%
|
%
|
%
|
UK
GDP1
|
4.9
|
5.6
|
2.3
|
UK
unemployment2
|
5.8
|
5.7
|
5.1
|
UK
HPI3
|
(0.5)
|
0.3
|
3.1
|
UK bank rate
|
0.1
|
0.2
|
0.4
|
US
GDP1
|
5.7
|
3.9
|
1.6
|
US
unemployment4
|
5.6
|
4.5
|
4.4
|
US
HPI5
|
3.9
|
3.5
|
3.5
|
US federal funds rate
|
0.3
|
0.3
|
0.7
|
|
|
|
|
As at 31.12.20
|
|
|
|
UK
GDP1
|
6.3
|
3.3
|
2.6
|
UK
unemployment2
|
6.7
|
6.4
|
5.8
|
UK
HPI3
|
2.4
|
2.3
|
5.0
|
UK bank rate
|
—
|
(0.1)
|
—
|
US
GDP1
|
3.9
|
3.1
|
2.9
|
US
unemployment4
|
6.9
|
5.7
|
5.6
|
US
HPI5
|
2.8
|
4.7
|
4.7
|
US federal funds rate
|
0.3
|
0.3
|
0.3
|
1
|
Average Real GDP seasonally adjusted change in year.
|
2
|
Average UK unemployment rate 16-year+.
|
3
|
Change in average yearly UK HPI = Halifax All Houses, All Buyers
index, relative to prior year end.
|
4
|
Average US civilian unemployment rate 16-year+.
|
5
|
Change in average yearly US HPI = FHFA House Price Index, relative
to prior year end.
|
Downside 2 average economic variables used in the calculation of
ECL
|
|
2021
|
2022
|
2023
|
As at 30.06.21
|
%
|
%
|
%
|
UK
GDP1
|
(1.7)
|
2.0
|
5.2
|
UK
unemployment2
|
7.3
|
8.2
|
6.6
|
UK
HPI3
|
(5.8)
|
(5.8)
|
0.2
|
UK bank rate
|
0.1
|
—
|
—
|
US
GDP1
|
1.5
|
1.4
|
2.0
|
US
unemployment4
|
8.7
|
11.0
|
9.3
|
US
HPI5
|
(4.9)
|
(3.0)
|
1.1
|
US federal funds rate
|
0.3
|
0.3
|
0.3
|
|
|
|
|
As at 31.12.20
|
|
|
|
UK
GDP1
|
(3.9)
|
6.5
|
2.6
|
UK
unemployment2
|
8.0
|
9.3
|
7.8
|
UK
HPI3
|
(13.6)
|
(10.8)
|
0.5
|
UK bank rate
|
(0.2)
|
(0.2)
|
(0.1)
|
US
GDP1
|
(2.4)
|
3.6
|
2.1
|
US
unemployment4
|
13.4
|
11.9
|
10.1
|
US
HPI5
|
(17.2)
|
(0.7)
|
0.6
|
US federal funds rate
|
0.3
|
0.3
|
0.3
|
1
|
Average Real GDP seasonally adjusted change in year.
|
2
|
Average UK unemployment rate 16-year+.
|
3
|
Change in average yearly UK HPI = Halifax All Houses, All Buyers
index, relative to prior year end.
|
4
|
Average US civilian unemployment rate 16-year+.
|
5
|
Change in average yearly US HPI = FHFA house price index, relative
to prior year end.
|
Downside 1 average economic variables used in the calculation of
ECL
|
|
2021
|
2022
|
2023
|
As at 30.06.21
|
%
|
%
|
%
|
UK
GDP1
|
0.6
|
4.4
|
4.2
|
UK
unemployment2
|
6.4
|
6.6
|
5.6
|
UK
HPI3
|
(3.1)
|
(2.7)
|
1.7
|
UK bank rate
|
0.1
|
0.1
|
0.2
|
US
GDP1
|
3.4
|
2.5
|
1.6
|
US
unemployment4
|
7.4
|
7.9
|
6.1
|
US
HPI5
|
(0.5)
|
0.2
|
2.3
|
US federal funds rate
|
0.3
|
0.3
|
0.3
|
|
|
|
|
As at 31.12.20
|
|
|
|
UK
GDP1
|
0.1
|
6.6
|
3.2
|
UK
unemployment2
|
7.3
|
8.0
|
6.9
|
UK
HPI3
|
(6.7)
|
(3.5)
|
1.7
|
UK bank rate
|
(0.1)
|
(0.1)
|
—
|
US
GDP1
|
0.4
|
3.6
|
2.3
|
US
unemployment4
|
11.0
|
8.9
|
6.9
|
US
HPI5
|
(5.9)
|
1.8
|
2.6
|
US federal funds rate
|
0.3
|
0.3
|
0.3
|
1
|
Average Real GDP seasonally adjusted change in year.
|
2
|
Average UK unemployment rate 16-year+.
|
3
|
Change in average yearly UK HPI = Halifax All Houses, All Buyers
index, relative to prior year end.
|
4
|
Average US civilian unemployment rate 16-year+.
|
5
|
Change in average yearly US HPI = FHFA House Price Index, relative
to prior year end.
|
Upside 2 average economic variables used in the calculation of
ECL
|
|
2021
|
2022
|
2023
|
As at 30.06.21
|
%
|
%
|
%
|
UK
GDP1
|
6.8
|
9.4
|
4.0
|
UK
unemployment2
|
5.5
|
4.9
|
4.4
|
UK
HPI3
|
4.6
|
9.9
|
11.3
|
UK bank rate
|
0.1
|
0.4
|
0.6
|
US
GDP1
|
6.5
|
8.2
|
3.4
|
US
unemployment4
|
5.3
|
3.8
|
3.8
|
US
HPI5
|
6.5
|
8.0
|
7.3
|
US federal funds rate
|
0.3
|
0.3
|
1.1
|
|
|
|
|
As at 31.12.20
|
|
|
|
UK
GDP1
|
12.2
|
5.3
|
3.9
|
UK
unemployment2
|
6.2
|
5.5
|
4.8
|
UK
HPI3
|
6.6
|
10.4
|
10.8
|
UK bank rate
|
0.1
|
0.3
|
0.3
|
US
GDP1
|
7.1
|
4.6
|
4.0
|
US
unemployment4
|
5.5
|
4.3
|
4.1
|
US
HPI5
|
8.8
|
9.1
|
8.9
|
US federal funds rate
|
0.3
|
0.4
|
0.6
|
1
|
Average Real GDP seasonally adjusted change in year.
|
2
|
Average UK unemployment rate 16-year+.
|
3
|
Change in average yearly UK HPI = Halifax All Houses, All Buyers
index, relative to prior year end.
|
4
|
Average US civilian unemployment rate 16-year+.
|
5
|
Change in average yearly US HPI = FHFA House Price Index, relative
to prior year end.
|
Upside 1 average economic variables used in the calculation of
ECL
|
|
2021
|
2022
|
2023
|
As at 30.06.21
|
%
|
%
|
%
|
UK
GDP1
|
5.9
|
7.3
|
3.0
|
UK
unemployment2
|
5.6
|
5.2
|
4.7
|
UK
HPI3
|
1.5
|
4.5
|
7.4
|
UK bank rate
|
0.1
|
0.2
|
0.6
|
US
GDP1
|
6.1
|
5.8
|
2.4
|
US
unemployment4
|
5.5
|
4.2
|
4.2
|
US
HPI5
|
6.2
|
6.8
|
5.7
|
US federal funds rate
|
0.3
|
0.3
|
0.9
|
|
|
|
|
As at 31.12.20
|
|
|
|
UK
GDP1
|
9.3
|
3.9
|
3.4
|
UK
unemployment2
|
6.4
|
6.0
|
5.2
|
UK
HPI3
|
4.6
|
6.1
|
6.1
|
UK bank rate
|
0.1
|
0.1
|
0.3
|
US
GDP1
|
5.5
|
4.0
|
3.7
|
US
unemployment4
|
6.0
|
4.8
|
4.6
|
US
HPI5
|
6.8
|
6.7
|
6.3
|
US federal funds rate
|
0.3
|
0.3
|
0.5
|
1
|
Average Real GDP seasonally adjusted change in year.
|
2
|
Average UK unemployment rate 16-year+.
|
3
|
Change in average yearly UK HPI = Halifax All Houses, All Buyers
index, relative to prior year end.
|
4
|
Average US civilian unemployment rate 16-year+.
|
5
|
Change in average yearly US HPI = FHFA House Price Index, relative
to prior year end.
|
Scenario probability weighting
|
|
Upside 2
|
Upside 1
|
Baseline
|
Downside 1
|
Downside 2
|
|
%
|
%
|
%
|
%
|
%
|
As at 30.06.21
|
|
|
|
|
|
Scenario probability weighting
|
19.6
|
24.5
|
26.4
|
16.9
|
12.6
|
As at 31.12.20
|
|
|
|
|
|
Scenario probability weighting
|
20.2
|
24.2
|
24.7
|
15.5
|
15.4
|
Specific
bases show the most extreme position of each variable in the
context of the scenario, for example, the highest unemployment for
downside scenarios, average unemployment for baseline scenarios and
lowest unemployment for upside scenarios. GDP and HPI downside and
upside scenario data represents the lowest and highest points
relative to the start point in the 20 quarter period.
Macroeconomic variables (specific
bases)1
|
|
|
|
|
|
|
Upside 2
|
Upside 1
|
Baseline
|
Downside 1
|
Downside 2
|
As at 30.06.21
|
%
|
%
|
%
|
%
|
%
|
UK
GDP2
|
25.9
|
20.2
|
3.3
|
(4.2)
|
(8.1)
|
UK
unemployment3
|
4.1
|
4.3
|
5.1
|
7.5
|
9.8
|
UK
HPI4
|
48.2
|
25.5
|
1.6
|
(5.8)
|
(11.8)
|
UK bank
rate3
|
0.1
|
0.1
|
0.4
|
0.3
|
0.1
|
US
GDP2
|
23.7
|
18.3
|
2.8
|
(0.2)
|
(3.2)
|
US
unemployment3
|
3.8
|
4.2
|
4.7
|
8.9
|
12.0
|
US
HPI4
|
41.2
|
32.6
|
3.6
|
(1.3)
|
(7.9)
|
US
federal funds rate3
|
0.3
|
0.3
|
0.8
|
1.5
|
0.8
|
|
|
|
|
|
|
As at 31.12.20
|
|
|
|
|
|
UK
GDP2
|
14.2
|
8.8
|
0.7
|
(22.1)
|
(22.1)
|
UK
unemployment3
|
4.0
|
4.0
|
5.7
|
8.4
|
10.1
|
UK
HPI4
|
48.2
|
30.8
|
3.6
|
(4.5)
|
(18.3)
|
UK bank
rate3
|
0.1
|
0.1
|
—
|
0.6
|
0.6
|
US
GDP2
|
15.7
|
12.8
|
1.6
|
(10.6)
|
(10.6)
|
US
unemployment3
|
3.8
|
3.8
|
6.4
|
13.0
|
13.7
|
US
HPI4
|
42.2
|
30.9
|
3.8
|
(3.7)
|
(15.9)
|
US
federal funds rate3
|
0.1
|
0.1
|
0.3
|
1.3
|
1.3
|
1
|
UK GDP = Real GDP growth seasonally adjusted; UK unemployment = UK
unemployment rate 16-year+; UK HI = 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. 20 quarter period starts from Q121 (2020:
Q120).
|
2
|
Maximum growth relative to Q420 (2020: Q419), based on 20 quarter
period in Upside scenarios; 5-year yearly average Compound Annual
Growth Rate (CAGR) in Baseline; minimum growth relative to Q420
(2020: Q419), based on 20 quarter period in Downside
scenarios.
|
3
|
Lowest quarter in 20 quarter period in Upside scenarios; 5-year
average in Baseline; highest quarter in 20 quarter period in
Downside scenarios.
|
4
|
Maximum growth relative to Q420 (2020: Q419), based on 20 quarter
period in Upside scenarios; 5-year quarter end CAGR in Baseline;
minimum growth relative to Q420 (2020: Q419), based on 20 quarter
period in Downside scenarios.
|
Average
basis represents the average quarterly value of variables in the 20
quarter period with GDP and HPI based on yearly average and
quarterly CAGRs respectively.
Macroeconomic variables (5 year
averages)1
|
|
|
|
|
|
|
Upside 2
|
Upside 1
|
Baseline
|
Downside 1
|
Downside 2
|
As at 30.06.21
|
%
|
%
|
%
|
%
|
%
|
UK
GDP2
|
5.2
|
4.2
|
3.3
|
2.6
|
1.8
|
UK
unemployment3
|
4.6
|
4.8
|
5.1
|
5.7
|
6.5
|
UK
HPI4
|
8.2
|
4.7
|
1.6
|
—
|
(1.6)
|
UK bank
rate3
|
0.7
|
0.6
|
0.4
|
0.2
|
—
|
US
GDP2
|
4.6
|
3.7
|
2.8
|
2.0
|
1.4
|
US
unemployment3
|
4.1
|
4.4
|
4.7
|
6.3
|
8.5
|
US
HPI4
|
7.1
|
5.8
|
3.6
|
1.6
|
(0.4)
|
US
federal funds rate3
|
1.1
|
0.9
|
0.8
|
0.6
|
0.3
|
|
|
|
|
|
|
As at 31.12.20
|
|
|
|
|
|
UK
GDP2
|
2.5
|
1.6
|
0.7
|
0.1
|
(0.9)
|
UK
unemployment3
|
5.0
|
5.3
|
5.7
|
6.5
|
7.2
|
UK
HPI4
|
8.2
|
5.5
|
3.6
|
(0.2)
|
(3.6)
|
UK bank
rate3
|
0.3
|
0.2
|
—
|
—
|
(0.1)
|
US
GDP2
|
2.9
|
2.4
|
1.6
|
0.8
|
0.1
|
US
unemployment3
|
5.3
|
5.7
|
6.4
|
8.3
|
10.4
|
US
HPI4
|
7.3
|
5.5
|
3.8
|
0.8
|
(3.0)
|
US
federal funds rate3
|
0.5
|
0.5
|
0.3
|
0.3
|
0.3
|
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.
|
2
|
5-year yearly average CAGR, starting 2020 (2020:
2019).
|
3
|
5-year average. Period based on 20 quarters from Q121 (2020:
Q120).
|
4
|
5-year quarter end CAGR, starting Q420 (2020: Q419).
|
ECL under 100% weighted scenarios for modelled
portfolios
The
table below shows the ECL assuming scenarios have been 100%
weighted. Model exposures are allocated to a stage based on the
individual scenario rather than through a probability-weighted
approach as required for Barclays reported impairment allowances.
As a result, it is not possible to back solve to the final reported
weighted ECL from the individual scenarios as a balance may be
assigned to a different stage dependent on the scenario. Model
exposure uses exposure at default (EAD) values and is not directly
comparable to gross exposure used in prior disclosures. For Credit
cards, unsecured loans and other retail lending, an average EAD
measure is used (12-month or lifetime, depending on stage
allocation in each scenario). Therefore, the model exposure
movement into Stage 2 is higher than the corresponding Stage 1
reduction.
All ECL
using a model is included, with the exception of Treasury assets
(£4m of ECL). Non-modelled exposures and management
adjustments are excluded. Management adjustments can be found in
the Management adjustments to models for impairment
section.
Model
exposures allocated to Stage 3 do not change in any of the
scenarios as the transition criteria relies only on observable
evidence of default as at 30 June 2021 and not on
macroeconomic scenarios.
The
Downside 2 scenario represents a severe global recession with
substantial falls in both UK and US GDP. Unemployment in UK markets
rises towards 9.8% and US markets rises towards 12% and there are
substantial falls in asset prices including housing. Under the
Downside 2 scenario, model exposure moves between stages as the
economic environment weakens. This can be seen in the movement of
£18bn of model exposure into Stage 2 between the Weighted and
Downside 2 scenario. ECL increases in Stage 2 predominantly due to
unsecured portfolios as economic conditions
deteriorate.
|
Scenarios
|
As at 30.06.21
|
Weighted
|
Upside 2
|
Upside 1
|
Baseline
|
Downside 1
|
Downside 2
|
Stage 1 Model Exposure (£m)
|
|
|
|
|
|
|
Home loans
|
131,134
|
133,584
|
132,343
|
130,694
|
128,711
|
126,953
|
Credit cards, unsecured loans and other retail lending
|
44,014
|
45,185
|
44,809
|
44,307
|
42,383
|
39,252
|
Wholesale loans
|
160,174
|
162,762
|
162,201
|
160,564
|
158,614
|
152,164
|
Stage 1 Model ECL (£m)
|
|
|
|
|
|
|
Home loans
|
4
|
2
|
3
|
4
|
6
|
8
|
Credit cards, unsecured loans and other retail lending
|
379
|
269
|
288
|
324
|
456
|
486
|
Wholesale loans
|
248
|
187
|
203
|
224
|
306
|
352
|
Stage 1 Coverage (%)
|
|
|
|
|
|
|
Home loans
|
—
|
—
|
—
|
—
|
—
|
—
|
Credit cards, unsecured loans and other retail lending
|
0.9
|
0.6
|
0.6
|
0.7
|
1.1
|
1.2
|
Wholesale loans
|
0.2
|
0.1
|
0.1
|
0.1
|
0.2
|
0.2
|
Stage 2 Model Exposure (£m)
|
|
|
|
|
|
|
Home loans
|
24,345
|
21,895
|
23,136
|
24,785
|
26,769
|
28,526
|
Credit cards, unsecured loans and other retail lending
|
7,175
|
5,733
|
6,205
|
6,819
|
9,066
|
12,625
|
Wholesale loans
|
33,666
|
31,077
|
31,639
|
33,276
|
35,225
|
41,676
|
Stage 2 Model ECL (£m)
|
|
|
|
|
|
|
Home loans
|
20
|
13
|
15
|
18
|
27
|
39
|
Credit cards, unsecured loans and other retail lending
|
1,076
|
733
|
841
|
976
|
1,544
|
2,517
|
Wholesale loans
|
773
|
594
|
646
|
709
|
939
|
1,342
|
Stage 2 Coverage (%)
|
|
|
|
|
|
|
Home loans
|
0.1
|
0.1
|
0.1
|
0.1
|
0.1
|
0.1
|
Credit cards, unsecured loans and other retail lending
|
15.0
|
12.8
|
13.6
|
14.3
|
17.0
|
19.9
|
Wholesale loans
|
2.3
|
1.9
|
2.0
|
2.1
|
2.7
|
3.2
|
Stage 3 Model Exposure (£m)
|
|
|
|
|
|
|
Home loans
|
1,829
|
1,829
|
1,829
|
1,829
|
1,829
|
1,829
|
Credit cards, unsecured loans and other retail lending
|
2,374
|
2,374
|
2,374
|
2,374
|
2,374
|
2,374
|
Wholesale
loans1
|
1,374
|
1,374
|
1,374
|
1,374
|
1,374
|
1,374
|
Stage 3 Model ECL (£m)
|
|
|
|
|
|
|
Home loans
|
324
|
307
|
315
|
325
|
337
|
352
|
Credit cards, unsecured loans and other retail lending
|
1,878
|
1,850
|
1,864
|
1,875
|
1,905
|
1,920
|
Wholesale
loans1
|
67
|
65
|
66
|
67
|
69
|
72
|
Stage 3 Coverage (%)
|
|
|
|
|
|
|
Home loans
|
17.7
|
16.8
|
17.2
|
17.8
|
18.4
|
19.2
|
Credit cards, unsecured loans and other retail lending
|
79.1
|
77.9
|
78.5
|
79.0
|
80.2
|
80.9
|
Wholesale
loans1
|
4.9
|
4.7
|
4.8
|
4.9
|
5.0
|
5.2
|
Total Model ECL (£m)
|
|
|
|
|
|
|
Home loans
|
348
|
322
|
333
|
347
|
370
|
399
|
Credit cards, unsecured loans and other retail lending
|
3,333
|
2,852
|
2,993
|
3,175
|
3,905
|
4,923
|
Wholesale
loans1
|
1,088
|
846
|
915
|
1,000
|
1,314
|
1,766
|
Total Model ECL
|
4,769
|
4,020
|
4,241
|
4,522
|
5,589
|
7,088
|
1
|
Material wholesale loan defaults are individually assessed across
different recovery strategies. As a result, ECL of £783m is
reported as individually assessed impairments in the table
below.
|
Reconciliation to total ECL
|
£m
|
Total model ECL
|
4,769
|
ECL from individually assessed impairments on stage 3
loans
|
783
|
ECL
from non-modelled and other management adjustments1
|
1,678
|
Total ECL
|
7,230
|
1
|
Includes £1.9bn post-model adjustments of which £0.4bn is
included as part of total model ECL and £0.2bn ECL from
non-modelled exposures.
|
The
dispersion of results around the Baseline is an indication of
uncertainty around the future projections. The disclosure
highlights the results of the alternative scenarios enabling the
reader to understand the extent of the impact on exposure and ECL
from the upside/downside scenarios. Consequently, the use of five
scenarios with associated weightings results in a total weighted
ECL uplift from the Baseline ECL of 5.5%, largely driven by credit
card losses which have more linear loss profiles than UK home loans
and wholesale loan positions.
Home loans: Total weighted ECL of £348m represents a
0.3% increase over the Baseline ECL (£347m), and coverage
ratios remain steady across the Upside scenarios, Baseline and
Downside 1 scenario. However, total ECL increases in the Downside 2
scenario to £399m, driven by a significant fall in UK HPI
(11.8%) reflecting the non-linearity of the UK
portfolio.
Credit cards, unsecured loans and other retail lending:
Total weighted ECL of £3,333m represents a 5% increase over
the Baseline ECL (£3,175m) reflecting the range of economic
scenarios used, mainly impacted by unemployment and other key
retail variables. Total ECL increases to £4,923m under
Downside 2 scenario, mainly driven by Stage 2, where coverage rates
increase to 19.9% from a weighted scenario approach of 15% and
circa £5.5bn increase in model exposure that meets the
Significant Increase in Credit Risk criteria and transitions from
Stage 1 to Stage 2.
Wholesale loans: Total weighted ECL of £1,088m
represents an 8.8% increase over the Baseline ECL (£1,000m)
reflecting the range of economic scenarios used, with exposures in
the Investment Bank particularly sensitive to the Downside 2
scenario.
|
Scenarios
|
As at 31.12.20
|
Weighted
|
Upside 2
|
Upside 1
|
Baseline
|
Downside 1
|
Downside 2
|
Stage 1 Model Exposure (£m)
|
|
|
|
|
|
|
Home loans
|
131,422
|
134,100
|
133,246
|
132,414
|
130,547
|
128,369
|
Credit cards, unsecured loans and other retail lending
|
51,952
|
53,271
|
52,932
|
51,995
|
50,168
|
48,717
|
Wholesale loans
|
149,099
|
155,812
|
154,578
|
152,141
|
144,646
|
131,415
|
Stage 1 Model ECL (£m)
|
|
|
|
|
|
|
Home loans
|
6
|
4
|
5
|
6
|
14
|
42
|
Credit cards, unsecured loans and other retail lending
|
392
|
316
|
340
|
372
|
415
|
415
|
Wholesale loans
|
262
|
242
|
258
|
249
|
278
|
290
|
Stage 1 Coverage (%)
|
|
|
|
|
|
|
Home loans
|
—
|
—
|
—
|
—
|
—
|
—
|
Credit cards, unsecured loans and other retail lending
|
0.8
|
0.6
|
0.6
|
0.7
|
0.8
|
0.9
|
Wholesale loans
|
0.2
|
0.2
|
0.2
|
0.2
|
0.2
|
0.2
|
Stage 2 Model Exposure (£m)
|
|
|
|
|
|
|
Home loans
|
19,180
|
16,502
|
17,356
|
18,188
|
20,055
|
22,233
|
Credit cards, unsecured loans and other retail lending
|
13,399
|
10,572
|
11,579
|
13,176
|
16,477
|
19,322
|
Wholesale loans
|
32,677
|
25,963
|
27,198
|
29,635
|
37,130
|
50,361
|
Stage 2 Model ECL (£m)
|
|
|
|
|
|
|
Home loans
|
37
|
31
|
32
|
33
|
42
|
63
|
Credit cards, unsecured loans and other retail lending
|
2,207
|
1,618
|
1,837
|
2,138
|
2,865
|
3,564
|
Wholesale loans
|
1,410
|
952
|
1,047
|
1,223
|
1,771
|
2,911
|
Stage 2 Coverage (%)
|
|
|
|
|
|
|
Home loans
|
0.2
|
0.2
|
0.2
|
0.2
|
0.2
|
0.3
|
Credit cards, unsecured loans and other retail lending
|
16.5
|
15.3
|
15.9
|
16.2
|
17.4
|
18.4
|
Wholesale loans
|
4.3
|
3.7
|
3.8
|
4.1
|
4.8
|
5.8
|
Stage 3 Model Exposure (£m)
|
|
|
|
|
|
|
Home loans
|
1,778
|
1,778
|
1,778
|
1,778
|
1,778
|
1,778
|
Credit cards, unsecured loans and other retail lending
|
2,585
|
2,585
|
2,585
|
2,585
|
2,585
|
2,585
|
Wholesale
loans1
|
2,211
|
2,211
|
2,211
|
2,211
|
2,211
|
2,211
|
Stage 3 Model ECL (£m)
|
|
|
|
|
|
|
Home loans
|
307
|
282
|
286
|
290
|
318
|
386
|
Credit cards, unsecured loans and other retail lending
|
2,003
|
1,947
|
1,972
|
2,001
|
2,055
|
2,078
|
Wholesale
loans1
|
146
|
128
|
134
|
141
|
157
|
184
|
Stage 3 Coverage (%)
|
|
|
|
|
|
|
Home loans
|
17.3
|
15.9
|
16.1
|
16.3
|
17.9
|
21.7
|
Credit cards, unsecured loans and other retail lending
|
77.5
|
75.3
|
76.3
|
77.4
|
79.5
|
80.4
|
Wholesale
loans1
|
6.6
|
5.8
|
6.1
|
6.4
|
7.1
|
8.3
|
Total Model ECL (£m)
|
|
|
|
|
|
|
Home loans
|
350
|
317
|
323
|
329
|
374
|
491
|
Credit cards, unsecured loans and other retail lending
|
4,602
|
3,881
|
4,149
|
4,511
|
5,335
|
6,057
|
Wholesale
loans1
|
1,818
|
1,322
|
1,439
|
1,613
|
2,206
|
3,385
|
Total Model ECL
|
6,770
|
5,520
|
5,911
|
6,453
|
7,915
|
9,933
|
1
|
Material wholesale loan defaults are individually assessed across
different recovery strategies. As a result, ECL of £902m is
reported as individually assessed impairments in the table
below.
|
Reconciliation to total ECL1
|
£m
|
Total model ECL
|
6,770
|
ECL from individually assessed impairments on stage 3
loans
|
902
|
ECL from non-modelled and other management adjustments
|
1,727
|
Total ECL
|
9,399
|
1
|
Includes £1.4bn of post-model adjustments and £0.3bn ECL
from non-modelled exposures.
|
Analysis of specific portfolios and asset types
Payment holidays
Payment
holidays are substantially concluded and due to roll off by the end
of July 2021. The impact of payment holidays on delinquency
performance in the period has been modest and as such detail has
not been included in the commentaries below.
Secured home loans
The UK
home loan portfolio primarily comprises first lien mortgages and
accounts for 93% (December 2020: 93%) of the Group’s total
home loans balance.
Home loans principal portfolios
|
Barclays UK
|
|
As at 30.06.21
|
As at 31.12.20
|
Gross loans and advances (£m)
|
155,247
|
148,343
|
90 day arrears rate, excluding recovery book (%)
|
0.1
|
0.2
|
Annualised gross charge-off rates - 180 days past due
(%)
|
0.6
|
0.6
|
Recovery book proportion of outstanding balances (%)
|
0.6
|
0.6
|
Recovery book impairment coverage ratio (%)
|
3.4
|
3.2
|
|
|
|
Average marked to market LTV
|
|
|
Balance weighted %
|
51.3
|
50.7
|
Valuation weighted %
|
38.0
|
37.6
|
|
|
|
New lending
|
Half year ended 30.06.21
|
Half year ended 30.06.20
|
New home loan bookings (£m)
|
19,120
|
9,977
|
New home loan proportion > 90% LTV (%)
|
0.9
|
3.7
|
Average LTV on new home loans: balance weighted (%)
|
68.7
|
68.4
|
Average LTV on new home loans: valuation weighted (%)
|
61.3
|
60.0
|
Home loans principal portfolios
– distribution of balances by LTV1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distribution of balances
|
Distribution of impairment allowance
|
Coverage ratio
|
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
Barclays UK
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
As at 30.06.21
|
|
|
|
|
|
|
|
|
|
|
|
|
<=75%
|
74.4
|
11.8
|
0.7
|
86.9
|
6.0
|
16.4
|
24.4
|
46.8
|
—
|
0.1
|
1.7
|
—
|
>75% and <=90%
|
11.4
|
0.9
|
—
|
12.3
|
3.9
|
20.4
|
10.8
|
35.1
|
—
|
1.2
|
14.2
|
0.1
|
>90% and <=100%
|
0.7
|
—
|
—
|
0.7
|
0.4
|
0.8
|
3.4
|
4.6
|
—
|
2.0
|
46.9
|
0.3
|
>100%
|
0.1
|
—
|
—
|
0.1
|
0.2
|
2.9
|
10.4
|
13.5
|
0.2
|
8.1
|
83.5
|
9.0
|
As at 31.12.20
|
|
|
|
|
|
|
|
|
|
|
|
|
<=75%
|
75.7
|
11.6
|
0.6
|
87.9
|
17.9
|
15.0
|
19.0
|
51.9
|
—
|
0.1
|
1.8
|
—
|
>75% and <=90%
|
10.8
|
0.8
|
—
|
11.6
|
9.7
|
14.8
|
7.6
|
32.1
|
0.1
|
1.2
|
16.0
|
0.2
|
>90% and <=100%
|
0.4
|
—
|
—
|
0.4
|
0.8
|
1.5
|
2.2
|
4.5
|
0.1
|
2.6
|
35.7
|
0.7
|
>100%
|
0.1
|
—
|
—
|
0.1
|
0.7
|
3.4
|
7.4
|
11.5
|
0.7
|
10.3
|
69.1
|
8.0
|
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
2021.
|
The
increased level of new business was driven by elevated demand in
the house purchase market supported by government intervention
including stamp duty relief. Also, with the gradual roll back of
COVID restrictions, high LTV products were re-introduced in a
phased manner during 2021, including the introduction of a 95% LTV
product under the Government’s mortgage guarantee scheme in
April 2021. The comparatively lower LTV > 90% new loan
proportion is primarily a result of the mortgage guarantee scheme
being live for only 3 months of H121.
Head Office: Italian home loans
and advances at amortised cost reduced to £5.1bn (2020:
£5.7bn). The portfolio is secured on residential property with
an average balance weighted mark to market LTV of 61% (2020:
62.1%). 90 day arrears decreased to 1.4% (2020: 1.7%), gross
charge-off rates decreased to 0.8% (2020: 1.0%).
Credit cards, unsecured loans and other retail lending
The
principal portfolios listed below accounted for 83% (December 2020:
84%) of the 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 30.06.21
|
£m
|
%
|
%
|
%
|
%
|
Barclays UK
|
|
|
|
|
|
UK cards
|
10,202
|
1.4
|
0.6
|
4.9
|
4.8
|
UK personal loans
|
4,075
|
2.3
|
1.4
|
3.9
|
3.6
|
Barclays
Partner Finance
|
2,362
|
0.5
|
0.2
|
1.3
|
1.3
|
Barclays International
|
|
|
|
|
|
US cards
|
15,895
|
1.6
|
0.9
|
5.6
|
5.4
|
Germany consumer lending
|
3,398
|
1.5
|
0.7
|
0.9
|
0.8
|
|
|
|
|
|
|
As at 31.12.20
|
|
|
|
|
|
Barclays UK
|
|
|
|
|
|
UK cards
|
11,911
|
1.7
|
0.8
|
2.9
|
2.9
|
UK personal loans
|
4,591
|
2.3
|
1.2
|
3.4
|
3.1
|
Barclays Partner Finance
|
2,469
|
0.5
|
0.3
|
1.1
|
1.1
|
Barclays International
|
|
|
|
|
|
US cards
|
16,845
|
2.5
|
1.4
|
5.6
|
5.6
|
Germany consumer lending
|
3,458
|
1.9
|
0.8
|
1.2
|
1.1
|
UK cards: 30 and 90 day arrears rates reduced by 0.3% and
0.2% to 1.4% and 0.6% respectively, despite balances reducing by
c.£1.7bn. The reduction in arrears was driven by continued
COVID support measures, along with improved book quality reflecting
lower consumer demand, tighter lending criteria and reduced
customer credit limits. Gross and net write-off rates increased
significantly to 4.9% and 4.8% respectively as a result of the
significant reduction in overall balances since the accounts
originally charged off. In addition, fewer debt sales in 2020,
allowed balances to follow the contractual write-off processes,
rather than accelerated write-offs due to debt sales.
UK personal loans:
30 day arrears rate was stable at 2.3% whilst the 90 day arrears
rate increased by 0.2% to 1.4%. The increase in late cycle arrears
was driven by a higher flow in to delinquency, specifically in
Q121, of customers previously granted a payment holiday, as well as
an overall reduction in balances. Gross and net write-off rates
increased as a result of the reduction in overall
balances.
Barclays Partner Finance: 30 and 90 day
arrears rates remain stable and in line with December
2020.
US cards: 30 and 90 day arrears rates
improved and remain below pre-pandemic levels due to government
support schemes and industry payment deferrals that were made
available to consumers. These factors also contributed to the
decrease in balances.
Germany consumer lending: 30 and 90 day
arrears rates decreased, reflecting better-than-expected customer
resilience, helped by government support schemes. In addition,
improvements in collections processes and the implementation of
tighter underwriting criteria helped improve the credit quality of
the book.
Market Risk
Analysis of management value at risk (VaR)
The
table below shows the total management VaR on a diversified basis
by asset class. Total management VaR includes all trading positions
in CIB and Treasury and it is calculated with a one-day holding
period. VaR limits are applied to total management VaR and by asset
class. Additionally, the market risk management function applies
VaR sub-limits to material businesses and trading
desks.
Management VaR (95%) by asset class
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Half year ended 30.06.21
|
|
Half year ended 31.12.20
|
|
Half year ended 30.06.20
|
|
Average
|
High
|
Low
|
|
Average
|
High
|
Low
|
|
Average
|
High
|
Low
|
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
Credit risk
|
18
|
30
|
9
|
|
19
|
23
|
15
|
|
22
|
38
|
10
|
Interest rate risk
|
8
|
15
|
4
|
|
11
|
17
|
6
|
|
9
|
17
|
6
|
Equity risk
|
10
|
15
|
6
|
|
10
|
16
|
7
|
|
15
|
35
|
6
|
Basis risk
|
7
|
10
|
4
|
|
10
|
12
|
7
|
|
10
|
16
|
7
|
Spread risk
|
4
|
6
|
3
|
|
5
|
7
|
4
|
|
5
|
9
|
3
|
Foreign exchange risk
|
3
|
6
|
2
|
|
5
|
7
|
3
|
|
5
|
7
|
2
|
Commodity risk
|
—
|
1
|
—
|
|
1
|
1
|
—
|
|
1
|
1
|
—
|
Inflation risk
|
2
|
3
|
2
|
|
2
|
3
|
1
|
|
1
|
2
|
1
|
Diversification
effect1
|
(30)
|
n/a
|
n/a
|
|
(35)
|
n/a
|
n/a
|
|
(33)
|
n/a
|
n/a
|
Total management VaR
|
22
|
36
|
13
|
|
28
|
35
|
20
|
|
35
|
57
|
18
|
1
|
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.
|
Average
management VaR decreased 21% to £22m (H220: £28m),
reflecting a reduction of £5m due to a methodology update
which changed the historical lookback period of the VaR model from
two years to one year and reduced risk taking in the period. The
methodology change has increased the responsiveness of the model to
changes over time in volatility levels in the lookback
period.
Treasury and Capital Risk
The
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 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
The
liquidity risk stress assessment measures the potential contractual
and contingent stress outflows under a range of scenarios, which
are then used to determine the size of the liquidity pool that is
immediately available to meet anticipated outflows if a stress
occurs. The short-term scenarios include 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 event. The Group also runs a long-term liquidity
stress test, which measures the anticipated outflows over a 12
month market-wide scenario.
The CRR
(as amended by CRR II) liquidity coverage ratio (LCR) requirement
takes into account the relative stability of different sources of
funding and potential incremental funding requirements in a stress.
The LCR is designed to promote short-term resilience of a
bank’s liquidity risk profile by holding sufficient high
quality liquid assets to survive an acute stress scenario lasting
for 30 days.
As at
30 June 2021, the Group held eligible liquid assets in excess of
100% of net stress outflows to its internal and external regulatory
requirements.
Liquidity coverage ratio
|
|
|
|
As at 30.06.21
|
As at 31.12.20
|
|
£bn
|
£bn
|
Eligible liquidity buffer
|
280
|
258
|
Net stress outflows
|
(172)
|
(159)
|
Surplus
|
108
|
99
|
|
|
|
Liquidity coverage ratio
|
162%
|
162%
|
The
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 30.06.21
|
As at 31.12.20
|
|
Liquidity pool
|
Liquidity pool of which CRD IV LCR
eligible3
|
Liquidity pool
|
|
Cash
|
Level 1
|
Level 2A
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Cash and deposits with central banks1
|
224
|
217
|
—
|
—
|
197
|
|
|
|
|
|
|
Government bonds2
|
|
|
|
|
|
AAA to AA-
|
39
|
—
|
30
|
1
|
31
|
A+ to A-
|
6
|
—
|
1
|
5
|
13
|
BBB+ to BBB-
|
2
|
—
|
2
|
—
|
1
|
Total government bonds
|
47
|
—
|
33
|
6
|
45
|
|
|
|
|
|
|
Other
|
|
|
|
|
|
Government Guaranteed Issuers, PSEs and GSEs
|
8
|
—
|
5
|
2
|
10
|
International Organisations and MDBs
|
4
|
—
|
4
|
—
|
6
|
Covered bonds
|
7
|
—
|
6
|
2
|
8
|
Other
|
1
|
—
|
—
|
—
|
—
|
Total other
|
20
|
—
|
15
|
4
|
24
|
|
|
|
|
|
|
Total as at 30 June 2021
|
291
|
217
|
48
|
10
|
266
|
Total as at 31 December 2020
|
266
|
192
|
55
|
11
|
|
1
|
Includes cash held at central banks and surplus cash at central
banks related to payment schemes. Over 98% (December 2020: over
98%) was placed with the Bank of England, US Federal Reserve,
European Central Bank, Bank of Japan and Swiss National
Bank.
|
2
|
Of which over 76% (December 2020: over 78%) comprised UK, US,
French, German, Japanese, 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
Group liquidity pool increased to £291bn as at 30 June 2021
(December 2020: £266bn) driven by continued deposit growth,
further borrowing from the Bank of England’s Term Funding
Scheme with additional incentives for SMEs and a seasonal increase
in short-term wholesale funding, which were partly offset by an
increase in business funding consumption. During H121, the
month-end liquidity pool ranged from £290bn to £308bn
(H220: £266bn to £332bn), and the month-end average
balance was £296bn (H220: £318bn). 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 2021, 60% (December 2020: 64%) of the liquidity pool was
located in Barclays Bank PLC, 27% (December 2020: 23%) in Barclays
Bank UK PLC and 6% (December 2020: 7%) 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 Group in calculating
the LCR.
The
composition of the pool is subject to limits set by the Board and
the independent liquidity risk, credit risk and market risk
functions. In addition, the investment of the liquidity pool is
monitored for concentration by issuer, currency and asset type.
Given returns generated by these highly liquid assets, the risk and
reward profile is continuously managed.
Deposit funding
|
|
|
|
|
|
|
As at 30.06.21
|
|
As at 31.12.20
|
|
Loans and advances at amortised cost
|
Deposits at amortised cost
|
Loan: deposit ratio1
|
|
Loan: deposit ratio1
|
Funding of loans and advances
|
£bn
|
£bn
|
%
|
|
%
|
Barclays UK
|
222
|
256
|
87
|
|
89
|
Barclays International
|
122
|
245
|
50
|
|
51
|
Head Office
|
5
|
|
|
|
|
Barclays Group
|
349
|
501
|
70
|
|
71
|
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
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 Group aims to align the sources and uses of funding. As
such, retail and corporate loans and advances are largely funded by
deposits in the relevant entities, with the surplus primarily
funding the liquidity pool. 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
when netted against cash collateral received and paid. Wholesale
debt and equity is used to fund residual assets.
These
funding relationships as at 30 June 2021 are summarised
below:
|
As at 30.06.21
|
As at 31.12.20
|
|
|
As at 30.06.21
|
As at 31.12.20
|
Assets
|
£bn
|
£bn
|
|
Liabilities and equity
|
£bn
|
£bn
|
Loans
and advances at amortised cost1
|
340
|
335
|
|
Deposits at amortised cost
|
501
|
481
|
Group liquidity pool
|
291
|
266
|
|
<1 Year wholesale funding
|
58
|
43
|
|
|
|
|
>1 Year wholesale funding
|
101
|
102
|
Reverse repurchase agreements, trading portfolio assets, cash
collateral and settlement balances
|
419
|
376
|
|
Repurchase agreements, trading portfolio liabilities, cash
collateral and settlement balances
|
362
|
324
|
Derivative financial instruments
|
257
|
302
|
|
Derivative financial instruments
|
247
|
301
|
Other
assets2
|
69
|
71
|
|
Other liabilities
|
39
|
32
|
|
|
|
|
Equity
|
68
|
67
|
Total assets
|
1,376
|
1,350
|
|
Total liabilities and equity
|
1,376
|
1,350
|
1
|
Adjusted for liquidity pool debt securities reported at amortised
cost of £9bn (December 2020: £8bn).
|
2
|
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
£158.7bn (December 2020: £145bn). In H121, the Group
issued £5.9bn of MREL eligible instruments from Barclays PLC
(the Parent company) in a range of tenors and
currencies.
Our
operating companies also access wholesale funding markets to
maintain their stable and diversified funding bases. Barclays Bank
PLC continued to issue in the shorter-term and medium-term notes
markets. In addition, Barclays Bank UK PLC continued to issue in
the shorter-term markets.
Wholesale
funding of £57.8bn (December 2020: £42.7bn) matures in
less than one year, representing 36% (December 2020: 29%) of total
wholesale funding outstanding. This includes £18.8bn (December
2020: £20.3bn) related to term funding2.
Maturity profile of wholesale
funding1,2
|
|
|
|
|
|
|
|
|
<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)
|
—
|
1.2
|
—
|
0.8
|
2.0
|
4.7
|
6.8
|
6.9
|
5.3
|
12.1
|
37.8
|
Senior unsecured (privately placed)
|
—
|
—
|
0.1
|
—
|
0.1
|
—
|
0.3
|
—
|
—
|
0.5
|
0.9
|
Subordinated liabilities
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
0.9
|
1.5
|
6.8
|
9.2
|
Barclays Bank PLC (including subsidiaries)
|
|
|
|
|
|
|
|
|
|
|
|
Certificates of deposit and commercial paper
|
3.7
|
8.0
|
8.9
|
8.9
|
29.5
|
0.4
|
0.1
|
—
|
—
|
—
|
30.0
|
Asset backed commercial paper
|
2.1
|
3.2
|
0.3
|
0.1
|
5.7
|
—
|
—
|
—
|
—
|
—
|
5.7
|
Senior unsecured (public benchmark)
|
—
|
0.1
|
—
|
1.3
|
1.4
|
—
|
1.0
|
—
|
—
|
0.5
|
2.9
|
Senior
unsecured (privately placed)3
|
0.9
|
2.6
|
2.3
|
5.3
|
11.1
|
7.7
|
7.5
|
4.9
|
3.5
|
21.8
|
56.5
|
Covered Bonds
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
Asset backed securities
|
—
|
—
|
0.5
|
0.1
|
0.6
|
0.6
|
0.1
|
0.1
|
0.3
|
1.4
|
3.1
|
Subordinated liabilities
|
—
|
0.4
|
—
|
1.0
|
1.4
|
1.1
|
0.1
|
0.1
|
—
|
0.9
|
3.6
|
Barclays Bank UK PLC (including subsidiaries)
|
|
|
|
|
|
|
|
|
|
|
|
Certificates of deposit and commercial paper
|
1.6
|
2.0
|
0.1
|
0.1
|
3.8
|
—
|
—
|
—
|
—
|
—
|
3.8
|
Senior unsecured (public benchmark)
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
0.2
|
0.2
|
Covered Bonds
|
—
|
—
|
—
|
2.2
|
2.2
|
1.7
|
—
|
—
|
—
|
1.1
|
5.0
|
Total as at 30 June 2021
|
8.3
|
17.5
|
12.2
|
19.8
|
57.8
|
16.2
|
15.9
|
12.9
|
10.6
|
45.3
|
158.7
|
Of which secured
|
2.1
|
3.2
|
0.8
|
2.4
|
8.5
|
2.3
|
0.1
|
0.1
|
0.3
|
2.5
|
13.8
|
Of which unsecured
|
6.2
|
14.3
|
11.4
|
17.4
|
49.3
|
13.9
|
15.8
|
12.8
|
10.3
|
42.8
|
144.9
|
|
|
|
|
|
|
|
|
|
|
|
|
Total as at 31 December 2020
|
5.7
|
15.4
|
9.5
|
12.1
|
42.7
|
15.6
|
16.7
|
12.3
|
10.2
|
47.5
|
145.0
|
Of which secured
|
2.3
|
5.0
|
0.7
|
0.5
|
8.5
|
3.1
|
2.2
|
0.5
|
0.2
|
2.6
|
17.1
|
Of which unsecured
|
3.4
|
10.4
|
8.8
|
11.6
|
34.2
|
12.5
|
14.5
|
11.8
|
10.0
|
44.9
|
127.9
|
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 £47.9bn, of which £10.2bn
matures within one year.
|
Credit ratings
In
addition to monitoring and managing key metrics related to the
financial strength of the 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 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 / Positive
|
A1 / Stable
|
A+ /
Stable
|
Short-term
|
A-1
|
P-1
|
F1
|
|
|
|
|
Barclays Bank UK PLC
|
|
|
|
Long-term
|
A / Positive
|
A1 / Stable
|
A+ / Stable
|
Short-term
|
A-1
|
P-1
|
F1
|
|
|
|
|
Barclays PLC
|
|
|
|
Long-term
|
BBB / Positive
|
Baa2 /Stable
|
A /
Stable
|
Short-term
|
A-2
|
P-2
|
F1
|
In June
2021, S&P revised the outlooks of Barclays PLC, Barclays Bank
PLC and Barclays Bank UK PLC to positive from stable, whilst
affirming all ratings. The revisions reflect the view that Barclays
is delivering a stronger, more consistent business profile and
financial performance.
In July
2021, Moody’s revised the outlook of Barclays Bank UK PLC to
stable from negative due to their view that asset quality and
profitability have stabilised following a turbulent
2020.
In July
2021, Fitch revised the outlooks of Barclays PLC, Barclays Bank PLC
and Barclays Bank UK PLC to stable from negative, whilst affirming
all ratings. The revisions reflected improved expectations for
economic recovery in Barclays’ key markets and the
Group’s resilient performance through the
pandemic.
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
November 2020 with stable outlooks.
A
credit rating downgrade could result in outflows to meet collateral
requirements on existing contracts. Outflows related to credit
rating downgrades are included in the LRA stress scenarios and a
portion of the liquidity pool is held against this risk. Credit
ratings downgrades could also result in reduced funding capacity
and increased funding costs.
The
contractual collateral requirement following one- and two-notch
long-term and associated short-term downgrades across all credit
rating agencies, would result in outflows of £1bn and
£4bn respectively, and are provided for in determining an
appropriate liquidity pool size given the Group’s liquidity
risk appetite. These numbers do not assume any management or
restructuring actions that could be taken to reduce posting
requirements. These outflows do not include the potential liquidity
impact from loss of unsecured funding, such as from money market
funds, or loss of secured funding capacity. However, unsecured and
secured funding stresses are included in the LRA stress scenarios
and a portion of the liquidity pool is held against these
risks.
Capital
The
Group’s Overall Capital Requirement for CET1 is 11.2%
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 2.7% Pillar 2A requirement and a 0%
Countercyclical Capital Buffer (CCyB).
The
Group’s CCyB is based on the buffer rate applicable for each
jurisdiction in which the Group has exposures. On 11 March 2020,
the Financial Policy Committee (FPC) set the CCyB rate for UK
exposures at 0% with immediate effect. The buffer rates set by
other national authorities for non-UK exposures are not currently
material. Overall, this results in a 0.0% CCyB for the
Group.
The
Group’s Pillar 2A requirement as per the PRA’s
Individual Capital Requirement is 4.8% of which at least 56.25%
needs to be met with CET1 capital, equating to approximately 2.7%
of RWAs. The Pillar 2A requirement is subject to at least
annual review and has been set as a nominal capital amount. This is
based on a point in time assessment and the requirement (when
expressed as a proportion of RWAs) will change depending on the
total RWAs at each reporting period.
Following
the withdrawal of the UK from the EU, any references to CRR as
amended by CRR II mean, unless otherwise specified, CRR as amended
by CRR II, as it forms part of UK law pursuant to the European
Union (Withdrawal) Act 2018 and subject to the temporary
transitional powers (TTP) available to UK regulators to delay or
phase-in on-shoring changes to UK regulatory requirements arising
at the end of the transition period until 31 March 2022, as at the
applicable reporting date. With effect from 26 June 2021, the
Financial Services Act 2021 amended CRR as amended by CRR II in
part. The amendments included an extension to the application of
CRR II settlement netting to the CRR leverage exposure which was
due to expire on 27 June 2021 under CRR II quick fix measures.
Throughout the TTP period, the Bank of England (BoE) and PRA will
continue to review the UK regulatory framework and the Group
disclosures will reflect the amended framework as applicable at the
effective reporting date.
On 26
April 2019, a prudential backstop was implemented for qualifying
exposures originating after 26 April 2019 that have been
non-performing for more than 2 years. Where minimum coverage
requirements for qualifying non-performing exposures are not met,
the difference must be deducted from CET1 capital. Different
conversion factors are applied for secured and unsecured exposures
depending on the length of time the exposures have been
non-performing. For 2021, the conversion factor applied to secured
non-performing exposures is 0% and for unsecured non-performing
exposures is 35% prior to any coverage being applied. For H121 the
impact to CET1 capital is immaterial.
On 9
July 2021, the PRA published their near final policy statement on
the implementation of Basel III standards. The policy statement
confirmed the PRA’s intention to revert to the previous
treatment of 100% CET1 capital deduction for qualifying software
assets, meaning the c.40bps benefit in the CET1 ratio will be
reversed from 1 January 2022.
Capital ratios1,2,3
|
As at 30.06.21
|
As at 31.03.21
|
As at 31.12.20
|
CET1
|
15.1%
|
14.6%
|
15.1%
|
Tier 1 (T1)
|
18.9%
|
18.4%
|
19.0%
|
Total regulatory capital
|
22.3%
|
21.8%
|
22.1%
|
|
|
|
|
Capital resources
|
£m
|
£m
|
£m
|
Total equity excluding non-controlling interests per the balance
sheet
|
67,052
|
65,105
|
65,797
|
Less: other equity instruments (recognised as AT1
capital)
|
(11,167)
|
(11,179)
|
(11,172)
|
Adjustment to retained earnings for foreseeable ordinary share
dividends
|
(510)
|
(303)
|
(174)
|
Adjustment to retained earnings for foreseeable repurchase of
shares
|
—
|
(439)
|
—
|
Adjustment to retained earnings for foreseeable other equity
coupons
|
(35)
|
(42)
|
(30)
|
|
|
|
|
Other regulatory adjustments and deductions
|
|
|
|
Additional value adjustments (PVA)
|
(1,447)
|
(1,496)
|
(1,146)
|
Goodwill and intangible assets
|
(6,814)
|
(6,504)
|
(6,914)
|
Deferred tax assets that rely on future profitability excluding
temporary differences
|
(664)
|
(629)
|
(595)
|
Fair value reserves related to gains or losses on cash flow
hedges
|
(665)
|
(850)
|
(1,575)
|
Gains or losses on liabilities at fair value resulting from own
credit
|
934
|
1,202
|
870
|
Defined benefit pension fund assets
|
(1,828)
|
(1,192)
|
(1,326)
|
Direct and indirect holdings by an institution of own CET1
instruments
|
(50)
|
(50)
|
(50)
|
Adjustment under IFRS 9 transitional arrangements
|
1,331
|
2,285
|
2,556
|
Other regulatory adjustments
|
88
|
(4)
|
55
|
CET1 capital
|
46,225
|
45,904
|
46,296
|
|
|
|
|
AT1 capital
|
|
|
|
Capital instruments and related share premium accounts
|
11,167
|
11,179
|
11,172
|
Qualifying AT1 capital (including minority interests) issued by
subsidiaries
|
648
|
655
|
646
|
Other regulatory adjustments and deductions
|
(80)
|
(80)
|
(80)
|
AT1 capital
|
11,735
|
11,754
|
11,738
|
|
|
|
|
T1 capital
|
57,960
|
57,658
|
58,034
|
|
|
|
|
T2 capital
|
|
|
|
Capital instruments and related share premium accounts
|
8,969
|
8,951
|
7,836
|
Qualifying T2 capital (including minority interests) issued by
subsidiaries
|
1,401
|
1,641
|
1,893
|
Credit risk adjustments (excess of impairment over expected
losses)
|
79
|
95
|
57
|
Other regulatory adjustments and deductions
|
(160)
|
(160)
|
(160)
|
Total regulatory capital
|
68,249
|
68,185
|
67,660
|
|
|
|
|
Total RWAs
|
306,424
|
313,356
|
306,203
|
1
|
CET1, T1 and T2 capital, and RWAs are calculated applying the
transitional arrangements of the CRR as amended by CRR II. 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 14.7%,
with £44.9bn of CET1 capital and £306.2bn of RWAs
calculated without applying the transitional arrangements of the
CRR as amended by CRR II.
|
3
|
The Group’s CET1 ratio, as is relevant for assessing against
the conversion trigger in Barclays Bank PLC 7.625% Contingent
Capital Notes, was 15.1%. For this calculation CET1 capital and
RWAs are calculated applying the transitional arrangements under
the CRR as amended by CRR II, 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 ended 30.06.21
|
Six months ended 30.06.21
|
|
£m
|
£m
|
Opening CET1 capital
|
45,904
|
46,296
|
|
|
|
Profit for the period attributable to equity holders
|
2,302
|
4,201
|
Own credit relating to derivative liabilities
|
3
|
17
|
Ordinary share dividends paid and foreseen
|
(380)
|
(509)
|
Purchased and foreseeable share repurchase
|
—
|
(700)
|
Other equity coupons paid and foreseen
|
(187)
|
(394)
|
Increase in retained regulatory capital generated from
earnings
|
1,738
|
2,615
|
|
|
|
Net impact of share schemes
|
119
|
(48)
|
Fair value through other comprehensive income reserve
|
70
|
(250)
|
Currency translation reserve
|
(17)
|
(495)
|
Other reserves
|
5
|
(1)
|
Increase / (decrease) in other qualifying reserves
|
177
|
(794)
|
|
|
|
Pension remeasurements within reserves
|
289
|
103
|
Defined benefit pension fund asset deduction
|
(636)
|
(502)
|
Net impact of pensions
|
(347)
|
(399)
|
|
|
|
Additional value adjustments (PVA)
|
49
|
(301)
|
Goodwill and intangible assets
|
(310)
|
100
|
Deferred tax assets that rely on future profitability excluding
those arising from temporary differences
|
(35)
|
(69)
|
Adjustment under IFRS 9 transitional arrangements
|
(954)
|
(1,225)
|
Other regulatory adjustments
|
3
|
2
|
Decrease in regulatory capital due to adjustments and
deductions
|
(1,247)
|
(1,493)
|
|
|
|
Closing CET1 capital
|
46,225
|
46,225
|
CET1
capital decreased £0.1bn to £46.2bn (December 2020:
£46.3bn).
£4.2bn
of capital generated from profits were partially offset by
£1.6bn dividends paid and foreseen including £0.7bn for
the share buyback announced with FY20 results, a £0.5bn
accrual towards a FY21 dividend and £0.4bn of equity coupons
paid. Other significant movements in the period were:
●
|
A
£0.3bn reduction in the fair value through other comprehensive
income reserve driven by a decrease in the fair value of bonds due
to increasing bond yields
|
●
|
A 0.5bn
decrease in the currency translation reserves driven by the
depreciation of period end EUR and USD against GBP
|
●
|
A
£0.4bn decrease as a result of movements relating to pensions,
largely due to deficit contribution payments of £0.35bn in
April 2021
|
●
|
A
£0.3bn increase in the PVA deduction due to the removal of
temporary regulatory supporting measures applied to certain
additional valuation adjustments
|
●
|
A
£1.2bn decrease in IFRS 9 transitional relief, after tax,
primarily due to a credit impairment net release, impairment
migrations from stage 2 to stage 3 and a decrease to the amount of
relief applied to the pre-2020 impairment charge reducing to 50% in
2021 from 70% in 2020
|
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 30.06.21
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
|
£m
|
£m
|
Barclays UK
|
7,151
|
52,995
|
|
437
|
—
|
—
|
163
|
|
33
|
—
|
|
11,381
|
72,160
|
Corporate
and Investment Bank
|
26,406
|
71,540
|
|
15,343
|
18,973
|
101
|
2,668
|
|
17,761
|
18,010
|
|
23,453
|
194,255
|
Consumer,
Cards and Payments
|
19,218
|
2,509
|
|
158
|
40
|
—
|
29
|
|
—
|
55
|
|
6,948
|
28,957
|
Barclays International
|
45,624
|
74,049
|
|
15,501
|
19,013
|
101
|
2,697
|
|
17,761
|
18,065
|
|
30,401
|
223,212
|
Head Office
|
4,591
|
7,269
|
|
—
|
—
|
—
|
—
|
|
—
|
—
|
|
(808)
|
11,052
|
Barclays Group
|
57,366
|
134,313
|
|
15,938
|
19,013
|
101
|
2,860
|
|
17,794
|
18,065
|
|
40,974
|
306,424
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at 30.03.21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barclays UK
|
7,066
|
53,512
|
|
431
|
—
|
—
|
217
|
|
64
|
—
|
|
11,381
|
72,671
|
Corporate
and Investment Bank
|
25,832
|
75,854
|
|
13,781
|
19,218
|
102
|
2,452
|
|
16,479
|
24,083
|
|
23,452
|
201,253
|
Consumer,
Cards and Payments
|
18,621
|
2,875
|
|
178
|
41
|
—
|
28
|
|
—
|
59
|
|
6,949
|
28,751
|
Barclays International
|
44,453
|
78,729
|
|
13,959
|
19,259
|
102
|
2,480
|
|
16,479
|
24,142
|
|
30,401
|
230,004
|
Head Office
|
4,424
|
7,065
|
|
—
|
—
|
—
|
—
|
|
—
|
—
|
|
(808)
|
10,681
|
Barclays Group
|
55,943
|
139,306
|
|
14,390
|
19,259
|
102
|
2,697
|
|
16,543
|
24,142
|
|
40,974
|
313,356
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at 31.12.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barclays UK
|
7,360
|
54,340
|
|
394
|
—
|
—
|
136
|
|
72
|
—
|
|
11,359
|
73,661
|
Corporate
and Investment Bank
|
24,660
|
73,792
|
|
12,047
|
20,280
|
246
|
2,351
|
|
13,123
|
22,363
|
|
23,343
|
192,205
|
Consumer,
Cards and Payments
|
19,754
|
3,041
|
|
177
|
45
|
—
|
31
|
|
—
|
71
|
|
6,996
|
30,115
|
Barclays International
|
44,414
|
76,833
|
|
12,224
|
20,325
|
246
|
2,382
|
|
13,123
|
22,434
|
|
30,339
|
222,320
|
Head Office
|
4,153
|
6,869
|
|
—
|
—
|
—
|
—
|
|
—
|
—
|
|
(800)
|
10,222
|
Barclays Group
|
55,927
|
138,042
|
|
12,618
|
20,325
|
246
|
2,518
|
|
13,195
|
22,434
|
|
40,898
|
306,203
|
Movement analysis of RWAs
|
|
Credit risk
|
Counterparty credit risk
|
Market risk
|
Operational risk
|
Total RWAs
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
Opening RWAs (as at 31.12.20)
|
193,969
|
35,707
|
35,629
|
40,898
|
306,203
|
Book size
|
378
|
1,698
|
1,519
|
76
|
3,671
|
Acquisitions and disposals
|
(874)
|
—
|
—
|
—
|
(874)
|
Book quality
|
1,074
|
277
|
—
|
—
|
1,351
|
Model updates
|
(1,070)
|
(186)
|
—
|
—
|
(1,256)
|
Methodology and policy
|
(115)
|
416
|
(1,289)
|
—
|
(988)
|
Foreign
exchange movements1
|
(1,683)
|
—
|
—
|
—
|
(1,683)
|
Total RWA movements
|
(2,290)
|
2,205
|
230
|
76
|
221
|
Closing RWAs (as at 30.06.21)
|
191,679
|
37,912
|
35,859
|
40,974
|
306,424
|
1
|
Foreign exchange movements does not include foreign exchange for
counterparty credit risk or market risk.
|
Overall
RWAs remained broadly stable at £306.4bn (December 2020:
£306.2bn).
Credit
risk RWAs decreased £2.3bn:
●
|
A
£1.1bn increase in book quality is primarily due to reduction
in credit quality
|
●
|
A
£1.1bn decrease in model updates primarily due to modelled
risk weight recalibrations
|
●
|
A
£1.7bn decrease in FX is due to the depreciation of period end
EUR and USD against GBP
|
Counterparty
Credit risk RWAs increased £2.2bn:
●
|
A
£1.7bn increase in book size primarily due to an increase in
trading activities across SFTs and derivatives
|
Market
risk RWAs increased £0.2bn:
●
|
A
£1.5bn increase in book size primarily due to increased client
and trading activities
|
●
|
A
£1.3bn decrease in methodology and policy is driven by a
change in the historical look back period of the VaR model from two
years to one year
|
Leverage ratio and exposures
The
Group is subject to a leverage ratio requirement of 3.8% as at 30
June 2021. 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 of 0.0%. 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 must be covered solely with
CET1 capital. The CET1 capital held against the 0.53% G-SII ALRB
was £6.3bn.
The
Group 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. The Group 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 and
include the PRA’s adoption of CRR II settlement
netting.
On 29
June 2021, the FPC and PRA issued a consultation paper on proposed
changes to the UK leverage ratio framework. The consultation states
the intention to move to a single UK leverage ratio requirement
meaning that the CRR leverage ratio will no longer apply for UK
banks from 1 January 2022. Whilst largely upholding the existing
framework, some technical changes to the exposure measure have been
proposed that will align to the Basel III standards. Minimum
requirements for the Group remain the same with minimum
requirements also expected to be applied at the individual level;
individual requirements may be replaced with a sub-consolidated
measure, subject to permission from the PRA, from 1 January
2023.
Leverage ratios1,2
|
As at 30.06.21
|
As at 31.03.21
|
As at 31.12.20
|
£m
|
£m
|
£m
|
Average UK leverage ratio
|
4.8%
|
4.9%
|
5.0%
|
Average
T1 capital3
|
57,280
|
57,040
|
57,069
|
Average UK leverage exposure
|
1,191,986
|
1,174,887
|
1,146,919
|
|
|
|
|
UK leverage ratio
|
5.0%
|
5.0%
|
5.3%
|
|
|
|
|
CET1 capital
|
46,225
|
45,904
|
46,296
|
AT1 capital
|
11,087
|
11,099
|
11,092
|
T1 capital3
|
57,312
|
57,003
|
57,388
|
|
|
|
|
UK leverage exposure
|
1,153,570
|
1,145,413
|
1,090,907
|
|
|
|
|
UK leverage exposure
|
|
|
|
Accounting assets
|
|
|
|
Derivative financial instruments
|
256,636
|
270,717
|
302,446
|
Derivative cash collateral
|
54,063
|
51,797
|
64,798
|
Securities financing transactions (SFTs)
|
182,820
|
189,496
|
164,034
|
Loans and advances and other assets
|
882,814
|
867,646
|
818,236
|
Total IFRS assets
|
1,376,333
|
1,379,656
|
1,349,514
|
|
|
|
|
Regulatory consolidation adjustments
|
(1,406)
|
(1,926)
|
(1,144)
|
|
|
|
|
Derivatives adjustments
|
|
|
|
Derivatives netting
|
(229,123)
|
(242,857)
|
(272,275)
|
Adjustments to collateral
|
(42,774)
|
(45,464)
|
(57,414)
|
Net written credit protection
|
16,730
|
16,814
|
14,986
|
Potential future exposure (PFE) on derivatives
|
135,162
|
128,454
|
117,010
|
Total derivatives adjustments
|
(120,005)
|
(143,053)
|
(197,693)
|
|
|
|
|
SFTs adjustments
|
23,511
|
22,294
|
21,114
|
|
|
|
|
Regulatory deductions and other adjustments
|
(22,525)
|
(18,111)
|
(17,469)
|
|
|
|
|
Weighted off-balance sheet commitments
|
111,870
|
118,134
|
113,704
|
|
|
|
|
Qualifying central bank claims
|
(172,465)
|
(167,054)
|
(155,890)
|
|
|
|
|
Settlement netting
|
(41,743)
|
(44,527)
|
(21,229)
|
|
|
|
|
UK leverage exposure
|
1,153,570
|
1,145,413
|
1,090,907
|
1
|
Fully loaded average UK leverage ratio was 4.7%, with £55.5bn
of T1 capital and £1,190.2bn of leverage exposure. Fully
loaded UK leverage ratio was 4.9%, with £56.0bn of T1 capital
and £1,152.2bn of leverage exposure. Fully loaded UK leverage
ratios are calculated without applying the transitional
arrangements of the CRR as amended by CRR II.
|
2
|
Capital and leverage measures are calculated applying the
transitional arrangements of the CRR as amended by CRR
II.
|
3
|
T1 capital is calculated in line with the PRA
Handbook.
|
The
average UK leverage ratio decreased to 4.8% (December 2020: 5.0%).
The average leverage exposure increased by £45.1bn to
£1,192.0bn (December 2020: £1,146.9bn) largely driven by
an increase in SFTs, TPAs and PFE on derivatives.
The UK
leverage ratio decreased to 5.0% (December 2020: 5.3%). The UK
leverage exposure increased by £62.7bn to £1,153.6bn
(December 2020: £1,090.9bn) primarily driven by a £19.3bn
increase in TPAs, a £18.8bn increase in SFTs and a
£18.2bn increase in PFE on derivatives due to increased
trading activity in CIB.
The
Group also discloses a CRR leverage ratio1
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 2021, expected to be published on
13 August 2021 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.
|
MREL
The
Group is currently required to meet the higher of: (i) the
requirements set by the BoE based on RWAs and the higher of average
and UK leverage exposures; and (ii) the requirements in CRR as
amended by CRR II based on RWAs and CRR leverage exposures. The
MREL requirements are subject to phased implementation and will be
fully implemented by 1 January 2022. As at 30 June 2021, the
Group’s MREL requirement was to meet 6.9% of CRR leverage
exposures.
On 22
July 2021 the BoE published a consultation paper on its approach to
setting MREL. Under the proposed changes to their 2018 Statement of
Policy, from 1 January 2022, the Group’s expected MREL
requirements will be to meet the higher of: (i) two times the sum
of Pillar 1 and Pillar 2A; and (ii) the higher of two times the
applicable leverage ratio requirement or 6.75% of leverage
exposures. As the FPC and PRA’s intention is to move to a
single UK leverage framework, this means that CRR leverage exposure
requirements in relation to MREL may no longer apply from 1 January
2022. Additionally, the proposals clarify that own funds
instruments issued by subsidiaries will no longer be eligible to
count towards the Group’s MREL from 1 January
2022.
CET1
capital cannot be counted towards both MREL and the capital
buffers, meaning that the buffers will effectively be applied above
MREL requirements.
Own funds and eligible liabilities
ratios1,2
|
As a percentage of RWAs
|
|
As a percentage of CRR leverage exposure
|
|
As at 30.06.21
|
As at 31.03.21
|
As at 31.12.20
|
|
As at 30.06.21
|
As at 31.03.21
|
As at 31.12.20
|
Total Barclays PLC (the Parent company) own funds and eligible
liabilities
|
33.7%
|
32.1%
|
32.7%
|
|
7.7%
|
7.6%
|
8.0%
|
Total own funds and eligible liabilities, including eligible
Barclays Bank PLC instruments
|
34.4%
|
32.8%
|
33.6%
|
|
7.9%
|
7.8%
|
8.2%
|
|
|
|
|
|
|
|
|
Own funds and eligible
liabilities1,2
|
|
|
|
|
As at 30.06.21
|
As at 31.03.21
|
As at 31.12.20
|
|
|
|
|
|
£m
|
£m
|
£m
|
CET1 capital
|
|
|
|
|
46,225
|
45,904
|
46,296
|
AT1
capital instruments and related share premium accounts3
|
|
11,087
|
11,099
|
11,092
|
T2
capital instruments and related share premium accounts3
|
|
|
|
|
8,888
|
8,886
|
7,733
|
Eligible liabilities
|
|
|
|
|
37,095
|
34,571
|
35,086
|
Total Barclays PLC (the Parent company) own funds and eligible
liabilities
|
|
103,295
|
100,460
|
100,207
|
Qualifying AT1 capital (including minority interests) issued by
subsidiaries
|
|
648
|
655
|
646
|
Qualifying T2 capital (including minority interests) issued by
subsidiaries
|
|
1,401
|
1,641
|
1,893
|
Total own funds and eligible liabilities, including eligible
Barclays Bank PLC instruments
|
|
105,344
|
102,756
|
102,746
|
|
|
|
|
|
|
|
|
Total RWAs
|
|
|
|
|
306,424
|
313,356
|
306,203
|
Total CRR leverage exposure4
|
|
|
|
|
1,334,929
|
1,320,628
|
1,254,157
|
1
|
CET1, T1 and T2 capital, and RWAs are calculated applying the
transitional arrangements of the CRR as amended by CRR II. This
includes IFRS 9 transitional arrangements and the grandfathering of
CRR and CRR II non-compliant capital instruments.
|
2
|
The BoE has set external MREL based on the higher of RWAs and CRR
or UK leverage exposures which could result in the binding measure
changing in future periods. The 30 June 2021 Barclays PLC (the
Parent company) own funds and eligible liabilities ratio as a
percentage of the UK leverage exposure was 9.0% and as a percentage
of the average UK leverage exposure was 8.7%.
|
3
|
Includes other AT1 capital regulatory adjustments and deductions of
£80m (December 2020: £80m), and other T2 credit risk
adjustments and deductions of £81m (December 2020:
£103m).
|
4
|
Fully loaded CRR leverage exposure is calculated without applying
the transitional arrangements of the CRR as amended by CRR
II.
|
Statement of Directors’ Responsibilities
The
Directors (the names of whom are set out below) are required to
prepare the financial statements on a going concern basis unless it
is not appropriate to do so. In making this assessment, the
directors have considered information relating to present and
future conditions. Each of the Directors confirm that to the best
of their knowledge, the condensed consolidated interim financial
statements set out on pages 64 to 69 have been prepared in
accordance with International Accounting Standard 34,
‘Interim Financial Reporting’, as adopted by the UK,
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 2021 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
2021 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
2021
|
Signed
on 27 July 2021 on behalf of the Board by
James E Staley
|
|
Tushar Morzaria
|
Group Chief Executive
|
|
Group Finance Director
|
Barclays
PLC Board of Directors:
Chairman
|
Executive Directors
|
Non-Executive Directors
|
Nigel Higgins
|
James E Staley
Tushar Morzaria
|
Mike Ashley
Tim Breedon CBE
Mohamed A. El-Erian
Dawn Fitzpatrick
Mary Francis CBE
Crawford Gillies
Brian Gilvary
Diane Schueneman
Julia Wilson
|
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 2021 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
2021;
|
●
|
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 2021
is not prepared, in all material respects, in accordance with IAS
34 Interim Financial
Reporting as adopted for use in the UK 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.
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, the Basis of preparation, the latest annual
financial statements of the Barclays Group are prepared in
accordance with International Financial Reporting Standards adopted
pursuant to Regulation (EC) No 1606/2002 as it applies in the
European Union and in accordance with international accounting
standards in conformity with the requirements of the Companies Act
2006 and the next annual financial statements will be prepared in
accordance with UK-adopted international accounting standards. 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 for use in the
UK.
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
27 July
2021
Condensed Consolidated Financial Statements
Condensed consolidated income statement (unaudited)
|
|
|
Half year ended 30.06.21
|
Half year ended 30.06.20
|
|
Notes1
|
£m
|
£m
|
Interest and similar income
|
|
5,279
|
6,437
|
Interest and similar expense
|
|
(1,376)
|
(2,214)
|
Net interest income
|
|
3,903
|
4,223
|
Fee and commission income
|
3
|
4,682
|
4,399
|
Fee and commission expense
|
3
|
(976)
|
(1,090)
|
Net fee and commission income
|
3
|
3,706
|
3,309
|
Net trading income
|
|
3,482
|
4,198
|
Net investment income
|
|
152
|
(136)
|
Other income
|
|
72
|
27
|
Total income
|
|
11,315
|
11,621
|
Credit impairment releases/(charges)
|
|
742
|
(3,738)
|
Net operating income
|
|
12,057
|
7,883
|
|
|
|
|
Staff costs
|
4
|
(4,334)
|
(4,053)
|
Infrastructure, administration and general expenses
|
5
|
(2,798)
|
(2,510)
|
Litigation and conduct
|
|
(99)
|
(30)
|
Operating expenses
|
|
(7,231)
|
(6,593)
|
|
|
|
|
Share of post-tax results of associates and joint
ventures
|
|
154
|
(31)
|
Profit on disposal of subsidiaries, associates and joint
ventures
|
|
(1)
|
13
|
Profit before tax
|
|
4,979
|
1,272
|
Tax charge
|
6
|
(759)
|
(113)
|
Profit after tax
|
|
4,220
|
1,159
|
|
|
|
|
Attributable to:
|
|
|
|
Equity holders of the parent
|
|
3,812
|
695
|
Other equity instrument holders
|
|
389
|
427
|
Total equity holders of the parent
|
|
4,201
|
1,122
|
Non-controlling interests
|
7
|
19
|
37
|
Profit after tax
|
|
4,220
|
1,159
|
|
|
|
|
Earnings per share
|
|
p
|
p
|
Basic earnings per ordinary share
|
8
|
22.2
|
4.0
|
Diluted earnings per ordinary share
|
8
|
21.7
|
3.9
|
1
|
For notes to the Financial Statements see pages 70 to
96.
|
Condensed consolidated statement of comprehensive income
(unaudited)
|
|
|
|
|
|
|
Half year ended 30.06.21
|
Half year ended 30.06.20
|
|
Notes1
|
£m
|
£m
|
Profit after tax
|
|
4,220
|
1,159
|
|
|
|
|
Other comprehensive income/(loss) that may be recycled to profit or
loss:2
|
|
|
Currency translation reserve
|
19
|
(495)
|
1,220
|
Fair value through other comprehensive income reserve
|
19
|
(365)
|
137
|
Cash flow hedging reserve
|
19
|
(911)
|
912
|
Other
|
19
|
—
|
(6)
|
Other comprehensive income that may be recycled to
profit
|
|
(1,771)
|
2,263
|
|
|
|
|
Other comprehensive income/(loss) not recycled to profit or
loss:2
|
|
|
Retirement benefit remeasurements
|
16
|
103
|
645
|
Fair value through other comprehensive income reserve
|
19
|
115
|
(515)
|
Own credit
|
19
|
(47)
|
496
|
Other comprehensive income not recycled to profit
|
|
171
|
626
|
|
|
|
|
Other comprehensive income for the period
|
|
(1,600)
|
2,889
|
|
|
|
|
Total comprehensive income for the period
|
|
2,620
|
4,048
|
|
|
|
|
Attributable to:
|
|
|
|
Equity holders of the parent
|
|
2,601
|
4,011
|
Non-controlling interests
|
|
19
|
37
|
Total comprehensive income for the period
|
|
2,620
|
4,048
|
1
|
For notes to the Financial Statements see pages 70 to
96.
|
2
|
Reported net of tax.
|
Condensed consolidated balance sheet (unaudited)
|
|
|
As at 30.06.21
|
As at 31.12.20
|
Assets
|
Notes1
|
£m
|
£m
|
Cash and balances at central banks
|
|
216,963
|
191,127
|
Cash collateral and settlement balances
|
|
111,921
|
101,367
|
Loans and advances at amortised cost
|
12
|
348,549
|
342,632
|
Reverse repurchase agreements and other similar secured
lending
|
|
4,459
|
9,031
|
Trading portfolio assets
|
|
147,239
|
127,950
|
Financial assets at fair value through the income
statement
|
|
194,421
|
175,151
|
Derivative financial instruments
|
10
|
256,636
|
302,446
|
Financial assets at fair value through other comprehensive
income
|
|
73,260
|
78,688
|
Investments in associates and joint ventures
|
|
907
|
781
|
Goodwill and intangible assets
|
13
|
8,196
|
7,948
|
Property, plant and equipment
|
|
3,581
|
4,036
|
Current tax assets
|
|
228
|
477
|
Deferred tax assets
|
6
|
3,771
|
3,444
|
Retirement benefit assets
|
16
|
2,701
|
1,814
|
Other assets
|
|
3,501
|
2,622
|
Total assets
|
|
1,376,333
|
1,349,514
|
|
|
|
|
Liabilities
|
|
|
|
Deposits at amortised cost
|
12
|
500,895
|
481,036
|
Cash collateral and settlement balances
|
|
101,923
|
85,423
|
Repurchase agreements and other similar secured
borrowing
|
|
20,005
|
14,174
|
Debt securities in issue
|
|
90,733
|
75,796
|
Subordinated Liabilities
|
14
|
12,839
|
16,341
|
Trading portfolio liabilities
|
|
56,986
|
47,405
|
Financial liabilities designated at fair value
|
|
264,164
|
249,765
|
Derivative financial instruments
|
10
|
247,034
|
300,775
|
Current tax liabilities
|
|
592
|
645
|
Deferred tax liabilities
|
6
|
8
|
15
|
Retirement benefit liabilities
|
16
|
338
|
291
|
Other liabilities
|
|
10,928
|
8,662
|
Provisions
|
15
|
1,772
|
2,304
|
Total liabilities
|
|
1,308,217
|
1,282,632
|
|
|
|
|
Equity
|
|
|
|
Called up share capital and share premium
|
17
|
4,568
|
4,637
|
Other reserves
|
19
|
2,856
|
4,461
|
Retained earnings
|
|
48,461
|
45,527
|
Shareholders' equity attributable to ordinary shareholders of the
parent
|
|
55,885
|
54,625
|
Other equity instruments
|
18
|
11,167
|
11,172
|
Total equity excluding non-controlling interests
|
|
67,052
|
65,797
|
Non-controlling interests
|
7
|
1,064
|
1,085
|
Total equity
|
|
68,116
|
66,882
|
|
|
|
|
Total equity and liabilities
|
|
1,376,333
|
1,349,514
|
1
|
For notes to the Financial Statements see pages 70 to
96.
|
Condensed consolidated statement of changes in equity
(unaudited)
|
|
Called up share capital and share
premium1
|
Other equity
instruments1
|
Other reserves1
|
Retained earnings
|
Total
|
Non-controlling
interests2
|
Total equity
|
Half year ended 30.06.21
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Balance as at 1 January 2021
|
4,637
|
11,172
|
4,461
|
45,527
|
65,797
|
1,085
|
66,882
|
Profit after tax
|
—
|
389
|
—
|
3,812
|
4,201
|
19
|
4,220
|
Currency translation movements
|
—
|
—
|
(495)
|
—
|
(495)
|
—
|
(495)
|
Fair value through other comprehensive income reserve
|
—
|
—
|
(250)
|
—
|
(250)
|
—
|
(250)
|
Cash flow hedges
|
—
|
—
|
(911)
|
—
|
(911)
|
—
|
(911)
|
Retirement benefit remeasurements
|
—
|
—
|
—
|
103
|
103
|
—
|
103
|
Own credit
|
—
|
—
|
(47)
|
—
|
(47)
|
—
|
(47)
|
Total comprehensive income for the period
|
—
|
389
|
(1,703)
|
3,915
|
2,601
|
19
|
2,620
|
Equity settled share schemes
|
25
|
—
|
—
|
289
|
314
|
—
|
314
|
Other equity instruments coupon paid
|
—
|
(389)
|
—
|
—
|
(389)
|
—
|
(389)
|
Vesting of employee share schemes
|
—
|
—
|
4
|
(397)
|
(393)
|
—
|
(393)
|
Dividends paid
|
—
|
—
|
—
|
(173)
|
(173)
|
(16)
|
(189)
|
Repurchase of shares
|
(94)
|
—
|
94
|
(700)
|
(700)
|
—
|
(700)
|
Other movements
|
—
|
(5)
|
—
|
—
|
(5)
|
(24)
|
(29)
|
Balance as at 30 June 2021
|
4,568
|
11,167
|
2,856
|
48,461
|
67,052
|
1,064
|
68,116
|
|
|
|
|
|
|
|
|
Half year ended 31.12.20
|
|
|
|
|
|
|
|
Balance as at 1 July 2020
|
4,620
|
10,871
|
6,996
|
45,817
|
68,304
|
1,237
|
69,541
|
Profit after tax
|
—
|
430
|
—
|
831
|
1,261
|
41
|
1,302
|
Currency translation movements
|
—
|
—
|
(1,693)
|
—
|
(1,693)
|
—
|
(1,693)
|
Fair value through other comprehensive income reserve
|
—
|
—
|
570
|
—
|
570
|
—
|
570
|
Cash flow hedges
|
—
|
—
|
(339)
|
—
|
(339)
|
—
|
(339)
|
Retirement benefit remeasurements
|
—
|
—
|
—
|
(756)
|
(756)
|
—
|
(756)
|
Own credit
|
—
|
—
|
(1,077)
|
—
|
(1,077)
|
—
|
(1,077)
|
Other
|
—
|
—
|
—
|
11
|
11
|
—
|
11
|
Total comprehensive income for the period
|
—
|
430
|
(2,539)
|
86
|
(2,023)
|
41
|
(1,982)
|
Equity settled share schemes
|
17
|
—
|
—
|
(300)
|
(283)
|
—
|
(283)
|
Issue and exchange of other equity instruments
|
—
|
311
|
—
|
(55)
|
256
|
(158)
|
98
|
Other equity instruments coupon paid
|
—
|
(430)
|
—
|
—
|
(430)
|
—
|
(430)
|
Vesting of employee share schemes
|
—
|
—
|
4
|
(20)
|
(16)
|
—
|
(16)
|
Dividends paid
|
—
|
—
|
—
|
—
|
—
|
(42)
|
(42)
|
Other movements
|
—
|
(10)
|
—
|
(1)
|
(11)
|
7
|
(4)
|
Balance as at 31 December 2020
|
4,637
|
11,172
|
4,461
|
45,527
|
65,797
|
1,085
|
66,882
|
1
|
Details of share capital, other equity instruments and other
reserves are shown on pages 85 to 86.
|
2
|
Details of non-controlling interests are shown on page
74.
|
Condensed consolidated statement of changes in equity
(unaudited)
|
|
Called up share capital and share
premium1
|
Other equity
instruments1
|
Other reserves1
|
Retained earnings
|
Total
|
Non-controlling
interests2
|
Total equity
|
Half year ended 30.06.20
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Balance as at 1 January 2020
|
4,594
|
10,871
|
4,760
|
44,204
|
64,429
|
1,231
|
65,660
|
Profit after tax
|
—
|
427
|
—
|
695
|
1,122
|
37
|
1,159
|
Currency translation movements
|
—
|
—
|
1,220
|
—
|
1,220
|
—
|
1,220
|
Fair value through other comprehensive income reserve
|
—
|
—
|
(378)
|
—
|
(378)
|
—
|
(378)
|
Cash flow hedges
|
—
|
—
|
912
|
—
|
912
|
—
|
912
|
Retirement benefit remeasurements
|
—
|
—
|
—
|
645
|
645
|
—
|
645
|
Own credit
|
—
|
—
|
496
|
—
|
496
|
—
|
496
|
Other
|
—
|
—
|
—
|
(6)
|
(6)
|
—
|
(6)
|
Total comprehensive income for the period
|
—
|
427
|
2,250
|
1,334
|
4,011
|
37
|
4,048
|
Equity settled share schemes
|
26
|
—
|
—
|
603
|
629
|
—
|
629
|
Other equity instruments coupon paid
|
—
|
(427)
|
—
|
—
|
(427)
|
—
|
(427)
|
Vesting of employee share schemes
|
—
|
—
|
(14)
|
(327)
|
(341)
|
—
|
(341)
|
Dividends paid
|
—
|
—
|
—
|
—
|
—
|
(37)
|
(37)
|
Other movements
|
—
|
—
|
—
|
3
|
3
|
6
|
9
|
Balance as at 30 June 2020
|
4,620
|
10,871
|
6,996
|
45,817
|
68,304
|
1,237
|
69,541
|
1
|
Details of share capital, other equity instruments and other
reserves are shown on pages 85 to 86.
|
2
|
Details of non-controlling interests are shown on page
74.
|
Condensed consolidated cash flow statement (unaudited)
|
|
|
|
Half year ended 30.06.21
|
Half year ended
30.06.201
|
|
£m
|
£m
|
Profit before tax
|
4,979
|
1,272
|
Adjustment
for non-cash items2
|
6,900
|
(1,431)
|
Net
increase in loans and advances at amortised cost2
|
432
|
(12,868)
|
Net increase in deposits at amortised cost
|
19,859
|
51,126
|
Net increase in debt securities in issue
|
13,041
|
24,183
|
Changes
in other operating assets and liabilities3
|
(5,559)
|
(6,770)
|
Corporate income tax paid
|
(712)
|
(351)
|
Net cash from operating activities
|
38,940
|
55,161
|
Net
cash from investing activities2
|
(3,389)
|
(17,844)
|
Net cash from financing activities
|
(2,562)
|
3,133
|
Effect of exchange rates on cash and cash equivalents
|
(5,535)
|
7,814
|
Net increase/(decrease) in cash and cash equivalents
|
27,454
|
48,264
|
Cash
and cash equivalents at beginning of the period3
|
210,142
|
166,613
|
Cash and cash equivalents at end of the period3
|
237,596
|
214,877
|
1
|
H120 comparative figures have been restated to make the condensed
cash flow statement more relevant following a review of the
disclosure and the accounting policies applied that was undertaken
in H220. Amendments, which were first applied in the Barclays PLC
Annual Report 2020, have been made to the classification of cash
collateral reported within cash and cash equivalents and to the
presentation of items within net cash flows from operating and
investing activities. Footnotes 2 and 3 below quantify the impact
of the changes to the respective cash flow categories in H120 and
provide further detail.
|
2
|
Movements in cash and cash equivalents relating to debt securities
at amortised cost were previously shown within loans and advances
at amortised cost in operating activities. These debt securities
holdings are now considered to be part of the investing activity
performed by the Group following a change in accounting policy and
have been presented within investing activities in H121.
Comparatives have been restated. The effect of this change was to
reclassify £6,245m of net cash outflows from operating
activities to investing activities in H120.
|
3
|
Cash and cash equivalents have been restated to exclude cash
collateral and settlement balances, with the exception of balances
that the Group holds at central banks related to payment schemes.
The effect of this change decreased cash and cash equivalents by
£28,301m as at 30 June 2020 and £16,774m as at 31
December 2019. As a result, net cash from operating activities
decreased by £11,527m in H120, representing the net increase
in the cash collateral and settlement balances line item in this
period.
|
Financial Statement Notes
1. Basis of
preparation
These
condensed consolidated interim financial statements for the six
months ended 30 June 2021 have been prepared in accordance with the
Disclosure and Transparency Rules (DTR) of the UK’s Financial
Conduct Authority (FCA) and IAS 34, Interim Financial Reporting, as
published by the International Accounting Standards Board (IASB)
and adopted by the UK. The condensed consolidated interim financial
statements should be read in conjunction with the annual financial
statements for the year ended 31 December 2020. The annual
financial statements for the year ended 31 December 2020 were
prepared in accordance with international accounting standards in
conformity with the requirements of the Companies Act 2006 and in
accordance with International Financial Reporting Standards (IFRS)
and interpretations (IFRICs) as issued by the IASB and adopted
pursuant to Regulation (EC) No 1606/2002 as it applies in the
European Union as well as adopted by the UK. UK adopted IFRS and EU
adopted IFRS are currently the same and were the same as at 31
December 2020.
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 2020.
1. Going concern
The
financial statements are prepared on a going concern basis, as the
Directors are satisfied that the Group and parent company have the
resources to continue in business for a period of at least 12
months from approval of the interim financial statements. In making
this assessment, the Directors have considered a wide range of
information relating to present and future conditions and includes
a review of a working capital report (WCR). The WCR is used by the
Directors to assess the future performance of the business and that
it has the resources in place that are required to meet its ongoing
regulatory requirements. The WCR also includes an assessment of the
impact of internally generated stress testing scenarios on the
liquidity and capital requirement forecasts. The stress tests used
were based upon an assessment of reasonably possible downside
economic scenarios that the Group could experience.
The WCR
indicated that the Group had sufficient capital in place to support
its future business requirements and remained above its regulatory
minimum requirements in the internal stress scenarios.
2. Other disclosures
The
Credit risk disclosures on pages 27 to 45 form part of these
interim financial statements.
2. Segmental
reporting
Analysis of results by business
|
|
|
|
|
|
Barclays
UK
|
Barclays
International
|
Head
Office
|
Barclays
Group
|
Half year ended 30.06.21
|
£m
|
£m
|
£m
|
£m
|
Total income
|
3,199
|
8,218
|
(102)
|
11,315
|
Credit impairment releases
|
443
|
293
|
6
|
742
|
Net operating income/(expenses)
|
3,642
|
8,511
|
(96)
|
12,057
|
Operating expenses
|
(2,114)
|
(4,606)
|
(412)
|
(7,132)
|
Litigation and conduct
|
(22)
|
(84)
|
7
|
(99)
|
Total operating expenses
|
(2,136)
|
(4,690)
|
(405)
|
(7,231)
|
Other
net income1
|
—
|
22
|
131
|
153
|
Profit/(loss) before tax
|
1,506
|
3,843
|
(370)
|
4,979
|
|
|
|
|
|
As at 30.06.21
|
£bn
|
£bn
|
£bn
|
£bn
|
Total assets
|
311.2
|
1,046.8
|
18.3
|
1,376.3
|
|
Barclays
UK
|
Barclays
International
|
Head
Office
|
Barclays
Group
|
Half year ended 30.06.20
|
£m
|
£m
|
£m
|
£m
|
Total income
|
3,171
|
8,654
|
(204)
|
11,621
|
Credit impairment charges
|
(1,064)
|
(2,619)
|
(55)
|
(3,738)
|
Net operating income/(expenses)
|
2,107
|
6,035
|
(259)
|
7,883
|
Operating expenses
|
(2,041)
|
(4,405)
|
(117)
|
(6,563)
|
Litigation and conduct
|
(11)
|
(11)
|
(8)
|
(30)
|
Total operating expenses
|
(2,052)
|
(4,416)
|
(125)
|
(6,593)
|
Other
net income/(expenses)1
|
13
|
10
|
(41)
|
(18)
|
Profit/(loss) before tax
|
68
|
1,629
|
(425)
|
1,272
|
|
|
|
|
|
As at 31.12.20
|
£bn
|
£bn
|
£bn
|
£bn
|
Total assets
|
289.1
|
1,041.8
|
18.6
|
1,349.5
|
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.
|
Split of income by geographic
region1
|
|
|
|
Half year ended 30.06.21
|
Half year ended 30.06.20
|
|
£m
|
£m
|
United Kingdom
|
5,895
|
5,989
|
Europe
|
1,222
|
1,199
|
Americas
|
3,608
|
3,776
|
Africa and Middle East
|
20
|
20
|
Asia
|
570
|
637
|
Total
|
11,315
|
11,621
|
1
|
The geographical analysis is based on the location of the office
where the transactions are recorded.
|
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 30.06.21
|
£m
|
£m
|
£m
|
£m
|
Fee type
|
|
|
|
|
Transactional
|
408
|
1,181
|
—
|
1,589
|
Advisory
|
83
|
459
|
1
|
543
|
Brokerage and execution
|
109
|
553
|
—
|
662
|
Underwriting and syndication
|
—
|
1,715
|
—
|
1,715
|
Other
|
35
|
73
|
3
|
111
|
Total revenue from contracts with customers
|
635
|
3,981
|
4
|
4,620
|
Other non-contract fee income
|
—
|
62
|
—
|
62
|
Fee and commission income
|
635
|
4,043
|
4
|
4,682
|
Fee and commission expense
|
(108)
|
(861)
|
(7)
|
(976)
|
Net fee and commission income
|
527
|
3,182
|
(3)
|
3,706
|
|
Barclays UK
|
Barclays International
|
Head Office
|
Total
|
Half year ended 30.06.20
|
£m
|
£m
|
£m
|
£m
|
Fee type
|
|
|
|
|
Transactional
|
386
|
1,157
|
—
|
1,543
|
Advisory
|
79
|
306
|
1
|
386
|
Brokerage and execution
|
102
|
685
|
—
|
787
|
Underwriting and syndication
|
—
|
1,468
|
—
|
1,468
|
Other
|
38
|
115
|
2
|
155
|
Total revenue from contracts with customers
|
605
|
3,731
|
3
|
4,339
|
Other non-contract fee income
|
—
|
60
|
—
|
60
|
Fee and commission income
|
605
|
3,791
|
3
|
4,399
|
Fee and commission expense
|
(148)
|
(940)
|
(2)
|
(1,090)
|
Net fee and commission income
|
457
|
2,851
|
1
|
3,309
|
Transactional
fees are service charges on deposit accounts, cash management
services and transactional processing fees. These include
interchange and merchant fee income generated from credit and bank
card usage.
Advisory
fees are generated from wealth management services and investment
banking advisory services related to mergers, acquisitions and
financial restructurings.
Brokerage
and execution fees are earned for executing client transactions
with various 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. These include commitment fees to provide loan
financing.
4. Staff
costs
|
Half year ended 30.06.21
|
Half year ended 30.06.20
|
Compensation costs
|
£m
|
£m
|
Upfront bonus charge
|
824
|
476
|
Deferred bonus charge
|
262
|
269
|
Other incentives
|
6
|
4
|
Performance costs
|
1,092
|
749
|
Salaries
|
2,117
|
2,153
|
Social security costs
|
336
|
317
|
Post-retirement benefits
|
275
|
268
|
Other compensation costs
|
223
|
254
|
Total compensation costs
|
4,043
|
3,741
|
|
|
|
Other resourcing costs
|
|
|
Outsourcing
|
171
|
175
|
Redundancy and restructuring
|
23
|
39
|
Temporary staff costs
|
55
|
58
|
Other
|
42
|
40
|
Total other resourcing costs
|
291
|
312
|
|
|
|
Total staff costs
|
4,334
|
4,053
|
|
|
|
Barclays Group compensation costs as a % of total
income
|
35.7
|
32.2
|
No
material awards have yet been granted in relation to the 2021 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. One of the primary considerations when
evaluating the accrual is Group and business level returns,
aligning colleague and shareholder interests.
The
Group has entered into physically settled forward contracts to
hedge the settlement of certain share-based payment schemes. The
present value of the fixed forward price to be paid under these
outstanding contracts is £158m and has been recorded in
retained earnings.
5. Infrastructure,
administration and general expenses
|
Half year ended 30.06.21
|
Half year ended 30.06.20
|
Infrastructure costs
|
£m
|
£m
|
Property and equipment
|
709
|
757
|
Depreciation and amortisation
|
832
|
751
|
Lease payments
|
20
|
26
|
Impairment of property, equipment and intangible
assets
|
304
|
32
|
Total infrastructure costs
|
1,865
|
1,566
|
|
|
|
Administration and general expenses
|
|
|
Consultancy, legal and professional fees
|
262
|
270
|
Marketing and advertising
|
163
|
158
|
Other administration and general expenses
|
508
|
516
|
Total administration and general expenses
|
933
|
944
|
|
|
|
Total infrastructure, administration and general
expenses
|
2,798
|
2,510
|
6. Tax
The tax
charge for H121 was £759m (H120: £113m), representing an
effective tax rate of 15.2% (H120: 8.9%). The effective tax rate
for H121 includes a benefit recognised as a result of the increase
in the UK corporation tax rate and absent this benefit the tax
charge would have been £1,151m and the effective tax rate
would have been 23.1%. The H120 effective tax rate included a
benefit recognised for re-measurement of the Group’s UK
deferred tax assets as a result of UK corporation tax previously
being maintained at a rate of 19%. Included in the H121 tax charge
is a credit of £104m (H120: £112m) in respect of payments
made on AT1 instruments that are classified as equity for
accounting purposes.
In its
Budget held in March 2021, the UK Government announced that the UK
rate of corporation tax will increase from 19% to 25% from 1 April
2023. This legislative change has been enacted, resulting in the
Group’s UK deferred tax assets increasing by £223m with
a tax benefit in the income statement of £392m and a tax
charge within other comprehensive income of
£169m.
The UK
Government also announced that it will undertake a review of the
additional 8% banking surcharge during 2021. The Budget Report
issued on 3 March 2021 outlines that “the government will set
out how it intends to ensure that the combined rate of tax on
banks’ profits does not increase substantially from its
current level”. Any subsequent reduction in the banking
surcharge arising from the Government’s review would result
in a tax charge in the income statement and tax credit within the
other comprehensive income upon enactment as the Group’s UK
deferred tax assets are again re-measured and decreased, the timing
of which is uncertain but is expected to occur in
H122.
In the
USA, the Biden administration published in April 2021 The Made In
America Tax Plan, which proposes an increase in the US federal
corporate income tax rate. This would result in a re-measurement to
increase the Group’s US deferred tax assets upon enactment,
the timing of which is uncertain. In addition, revisions to
international elements of the US tax regime are being considered
that could affect the Group’s US tax position in
future.
The G7
finance ministers published a communiqué on 5 June 2021 which
sets out high level political agreement on global tax reform,
including the implementation of a global minimum tax rate. The
Group will continue to monitor developments and assess the
potential impact of associated future legislative
changes.
|
As at 30.06.21
|
As at 31.12.20
|
Deferred tax assets and liabilities
|
£m
|
£m
|
USA
|
1,908
|
2,049
|
UK
|
1,380
|
886
|
Other territories
|
483
|
509
|
Deferred tax assets
|
3,771
|
3,444
|
Deferred tax liabilities
|
(8)
|
(15)
|
|
|
|
Analysis of deferred tax assets
|
|
|
Temporary differences
|
2,972
|
2,709
|
Tax losses
|
799
|
735
|
Deferred tax assets
|
3,771
|
3,444
|
7. Non-controlling
interests
|
Profit attributable to
non-controlling interests
|
|
Equity attributable to
non-controlling interests
|
|
Half year ended 30.06.21
|
Half year ended 30.06.20
|
|
As at 30.06.21
|
As at 31.12.20
|
|
£m
|
£m
|
|
£m
|
£m
|
Barclays Bank PLC issued:
|
|
|
|
|
|
- Preference shares
|
13
|
28
|
|
529
|
529
|
- Upper T2 instruments
|
3
|
9
|
|
533
|
533
|
Other non-controlling interests
|
3
|
—
|
|
2
|
23
|
Total
|
19
|
37
|
|
1,064
|
1,085
|
8. Earnings
per share
|
Half year ended 30.06.21
|
Half year ended 30.06.20
|
|
£m
|
£m
|
Profit attributable to ordinary equity holders of the
parent
|
3,812
|
695
|
|
|
|
|
m
|
m
|
Basic weighted average number of shares in issue
|
17,140
|
17,294
|
Number of potential ordinary shares
|
467
|
319
|
Diluted weighted average number of shares
|
17,607
|
17,613
|
|
|
|
|
p
|
p
|
Basic earnings per ordinary share
|
22.2
|
4.0
|
Diluted earnings per ordinary share
|
21.7
|
3.9
|
9. Dividends on ordinary
shares
A half
year dividend for 2021 of 2.0p (H120: 0p) per ordinary share will
be paid on 17 September 2021 to shareholders on the register on 13
August 2021.
|
Half year ended 30.06.21
|
Half year ended 30.06.20
|
|
Per share
|
Total
|
Per share
|
Total
|
Dividends paid during the period
|
p
|
£m
|
p
|
£m
|
Full year dividend paid during period
|
1.0
|
173
|
—
|
—
|
For
qualifying US and Canadian resident ADR holders, the half year
dividend of 2.0p per ordinary share becomes 8.0p per ADS
(representing 4 shares). The ADR depositary will post the half year
dividend on 17 September 2021 to ADR holders on the record at close
of business on 13 August 2021.
The
Directors have confirmed their intention to initiate a share
buyback of up to £500m after the balance sheet date. The share
buyback is expected to commence in the third quarter of 2021. The
financial statements for the six months ended 30 June 2021 do not
reflect the impact of the proposed share buyback, which will be
accounted for as and when shares are repurchased by the
Company.
10. Derivative financial
instruments
|
Contract notional amount
|
|
Fair value
|
|
|
Assets
|
Liabilities
|
As at 30.06.21
|
£m
|
|
£m
|
£m
|
Foreign exchange derivatives
|
5,654,026
|
|
66,963
|
(64,194)
|
Interest rate derivatives
|
37,888,009
|
|
134,734
|
(123,436)
|
Credit derivatives
|
920,030
|
|
5,469
|
(5,960)
|
Equity and stock index and commodity derivatives
|
1,541,007
|
|
48,530
|
(52,444)
|
Derivative assets/(liabilities) held for trading
|
46,003,072
|
|
255,696
|
(246,034)
|
|
|
|
|
|
Derivatives in hedge accounting relationships
|
|
|
|
|
Derivatives designated as cash flow hedges
|
91,278
|
|
806
|
—
|
Derivatives designated as fair value hedges
|
107,879
|
|
128
|
(993)
|
Derivatives designated as hedges of net investments
|
1,595
|
|
6
|
(7)
|
Derivative assets/(liabilities) designated in hedge accounting
relationships
|
200,752
|
|
940
|
(1,000)
|
|
|
|
|
|
Total recognised derivative assets/(liabilities)
|
46,203,824
|
|
256,636
|
(247,034)
|
|
|
|
|
|
As at 31.12.20
|
|
|
|
|
Foreign exchange derivatives
|
5,554,037
|
|
84,739
|
(84,381)
|
Interest rate derivatives
|
35,257,371
|
|
172,144
|
(162,402)
|
Credit derivatives
|
847,845
|
|
4,605
|
(5,004)
|
Equity and stock index and commodity derivatives
|
1,510,718
|
|
40,392
|
(48,008)
|
Derivative assets/(liabilities) held for trading
|
43,169,971
|
|
301,880
|
(299,795)
|
|
|
|
|
|
Derivatives in hedge accounting relationships
|
|
|
|
|
Derivatives designated as cash flow hedges
|
74,437
|
|
386
|
—
|
Derivatives designated as fair value hedges
|
114,556
|
|
155
|
(980)
|
Derivatives designated as hedges of net investments
|
791
|
|
25
|
—
|
Derivative assets/(liabilities) designated in hedge accounting
relationships
|
189,784
|
|
566
|
(980)
|
|
|
|
|
|
Total recognised derivative assets/(liabilities)
|
43,359,755
|
|
302,446
|
(300,775)
|
The
IFRS netting posted against derivative assets was £33bn
including £4bn of cash collateral netted (December 2020:
£44bn including £5bn cash collateral netted) and
£31bn for liabilities including £5bn of cash collateral
netted (December 2020: £42bn including £7bn of cash
collateral netted). Derivative asset exposures would be £230bn
(December 2020: £276bn) lower than reported under IFRS if
netting were permitted for assets and liabilities with the same
counterparty or for which the Group holds cash collateral of
£36bn (December 2020: £43bn). Similarly, derivative
liabilities would be £225bn (December 2020: £276bn) lower
reflecting counterparty netting and cash collateral placed of
£31bn (December 2020: £43bn). In addition, non-cash
collateral of £5bn (December 2020: £5bn) was held in
respect of derivative assets and £3bn (December 2020:
£4bn) 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 2020 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 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 30.06.21
|
£m
|
£m
|
£m
|
£m
|
Trading portfolio assets
|
73,405
|
71,282
|
2,552
|
147,239
|
Financial assets at fair value through the income
statement
|
1,229
|
185,415
|
7,777
|
194,421
|
Derivative financial instruments
|
11,643
|
241,336
|
3,657
|
256,636
|
Financial assets at fair value through other comprehensive
income
|
21,375
|
51,837
|
48
|
73,260
|
Investment property
|
—
|
—
|
8
|
8
|
Total assets
|
107,652
|
549,870
|
14,042
|
671,564
|
|
|
|
|
|
Trading portfolio liabilities
|
(30,911)
|
(26,058)
|
(17)
|
(56,986)
|
Financial liabilities designated at fair value
|
(142)
|
(263,710)
|
(312)
|
(264,164)
|
Derivative financial instruments
|
(11,227)
|
(230,207)
|
(5,600)
|
(247,034)
|
Total liabilities
|
(42,280)
|
(519,975)
|
(5,929)
|
(568,184)
|
|
|
|
|
|
As at 31.12.20
|
|
|
|
|
Trading portfolio assets
|
60,671
|
65,416
|
1,863
|
127,950
|
Financial assets at fair value through the income
statement
|
4,503
|
162,142
|
8,506
|
175,151
|
Derivative financial instruments
|
9,155
|
288,822
|
4,469
|
302,446
|
Financial assets at fair value through other comprehensive
income
|
19,792
|
58,743
|
153
|
78,688
|
Investment property
|
—
|
—
|
10
|
10
|
Total assets
|
94,121
|
575,123
|
15,001
|
684,245
|
|
|
|
|
|
Trading portfolio liabilities
|
(24,391)
|
(22,986)
|
(28)
|
(47,405)
|
Financial liabilities designated at fair value
|
(159)
|
(249,251)
|
(355)
|
(249,765)
|
Derivative financial instruments
|
(8,762)
|
(285,774)
|
(6,239)
|
(300,775)
|
Total liabilities
|
(33,312)
|
(558,011)
|
(6,622)
|
(597,945)
|
The
following table shows the Group’s Level 3 assets and
liabilities that are held at fair value disaggregated by product
type:
|
As at 30.06.21
|
As at 31.12.20
|
|
Assets
|
Liabilities
|
Assets
|
Liabilities
|
|
£m
|
£m
|
£m
|
£m
|
Interest rate derivatives
|
916
|
(1,269)
|
1,613
|
(1,615)
|
Foreign exchange derivatives
|
151
|
(129)
|
144
|
(143)
|
Credit derivatives
|
100
|
(364)
|
196
|
(351)
|
Equity derivatives
|
2,490
|
(3,838)
|
2,498
|
(4,112)
|
Commodity derivatives
|
—
|
—
|
18
|
(18)
|
Corporate debt
|
981
|
(38)
|
698
|
(3)
|
Reverse repurchase and repurchase agreements
|
—
|
(161)
|
—
|
(174)
|
Non-asset backed loans
|
6,338
|
—
|
6,394
|
—
|
Asset backed securities
|
562
|
—
|
767
|
(24)
|
Equity cash products
|
402
|
—
|
542
|
—
|
Private equity investments
|
979
|
(16)
|
873
|
(14)
|
Other1
|
1,123
|
(114)
|
1,258
|
(168)
|
Total
|
14,042
|
(5,929)
|
15,001
|
(6,622)
|
1
|
Other includes commercial real estate loans, funds and fund-linked
products, asset backed loans, issued debt, commercial paper,
government sponsored debt 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 31 December 2020: 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 period.
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 01.01.21
|
Purchases
|
Sales
|
Issues
|
Settle-
ments
|
Total gains and losses in the period recognised in the income
statement
|
Total gains or losses recognised in OCI
|
Transfers
|
As at 30.06.21
|
Trading income
|
Other income
|
In
|
Out
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Corporate debt
|
151
|
305
|
(87)
|
—
|
—
|
25
|
—
|
—
|
40
|
(11)
|
423
|
Non-asset backed loans
|
709
|
620
|
(131)
|
—
|
(84)
|
13
|
—
|
—
|
124
|
(106)
|
1,145
|
Asset backed securities
|
686
|
112
|
(294)
|
—
|
—
|
(10)
|
—
|
—
|
43
|
(48)
|
489
|
Equity cash products
|
214
|
13
|
(17)
|
—
|
—
|
32
|
—
|
—
|
29
|
(9)
|
262
|
Other
|
103
|
21
|
—
|
—
|
(51)
|
(1)
|
—
|
—
|
162
|
(1)
|
233
|
Trading portfolio assets
|
1,863
|
1,071
|
(529)
|
—
|
(135)
|
59
|
—
|
—
|
398
|
(175)
|
2,552
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-asset backed loans
|
5,580
|
698
|
(299)
|
—
|
(687)
|
(119)
|
—
|
—
|
69
|
(48)
|
5,194
|
Equity cash products
|
326
|
160
|
(194)
|
—
|
—
|
(171)
|
18
|
—
|
1
|
—
|
140
|
Private equity investments
|
874
|
106
|
(9)
|
—
|
(8)
|
(5)
|
92
|
—
|
—
|
(71)
|
979
|
Other
|
1,726
|
2,291
|
(2,389)
|
—
|
(162)
|
(19)
|
1
|
—
|
16
|
—
|
1,464
|
Financial assets at fair value through the income
statement
|
8,506
|
3,255
|
(2,891)
|
—
|
(857)
|
(314)
|
111
|
—
|
86
|
(119)
|
7,777
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-asset backed loans
|
106
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
(106)
|
—
|
Asset backed securities
|
47
|
4
|
—
|
—
|
(5)
|
—
|
—
|
2
|
—
|
—
|
48
|
Assets at fair value through other comprehensive
income
|
153
|
4
|
—
|
—
|
(5)
|
—
|
—
|
2
|
—
|
(106)
|
48
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment property
|
10
|
—
|
(2)
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
8
|
|
—
|
|
|
|
|
|
|
|
|
|
—
|
Trading portfolio liabilities
|
(28)
|
(3)
|
14
|
—
|
—
|
(7)
|
—
|
—
|
—
|
7
|
(17)
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities designated at fair value
|
(355)
|
—
|
—
|
—
|
98
|
7
|
(2)
|
—
|
(78)
|
18
|
(312)
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
(2)
|
9
|
—
|
—
|
33
|
(121)
|
4
|
—
|
21
|
(297)
|
(353)
|
Foreign exchange derivatives
|
1
|
—
|
—
|
—
|
58
|
(6)
|
—
|
—
|
3
|
(34)
|
22
|
Credit derivatives
|
(155)
|
(117)
|
2
|
—
|
(5)
|
12
|
(1)
|
—
|
1
|
(1)
|
(264)
|
Equity derivatives
|
(1,614)
|
(315)
|
(1)
|
—
|
(32)
|
(221)
|
(1)
|
—
|
28
|
808
|
(1,348)
|
Net derivative financial instruments1
|
(1,770)
|
(423)
|
1
|
—
|
54
|
(336)
|
2
|
—
|
53
|
476
|
(1,943)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
8,379
|
3,904
|
(3,407)
|
—
|
(845)
|
(591)
|
111
|
2
|
459
|
101
|
8,113
|
1
|
Derivative financial instruments are represented on a net basis. On
a gross basis, derivative financial assets were £3,657m and
derivative financial liabilities were £5,600m.
|
Level 3 movement analysis
|
|
As at 01.01.20
|
Purchases
|
Sales
|
Issues
|
Settle-
ments
|
Total gains and losses in the period recognised in the income
statement
|
Total gains or losses recognised in OCI
|
Transfers
|
As at 30.06.20
|
Trading income
|
Other income
|
In
|
Out
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Corporate debt
|
120
|
25
|
—
|
—
|
—
|
(26)
|
—
|
—
|
4
|
(17)
|
106
|
Non-asset backed loans
|
974
|
1,926
|
(740)
|
—
|
(4)
|
(111)
|
—
|
—
|
97
|
(320)
|
1,822
|
Asset backed securities
|
656
|
249
|
(224)
|
—
|
(76)
|
(12)
|
—
|
—
|
41
|
(11)
|
623
|
Equity cash products
|
392
|
2
|
(4)
|
—
|
—
|
(67)
|
—
|
—
|
28
|
(4)
|
347
|
Other
|
122
|
48
|
—
|
—
|
—
|
2
|
—
|
—
|
8
|
—
|
180
|
Trading portfolio assets
|
2,264
|
2,250
|
(968)
|
—
|
(80)
|
(214)
|
—
|
—
|
178
|
(352)
|
3,078
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-asset backed loans
|
5,494
|
1,050
|
(270)
|
—
|
(410)
|
381
|
—
|
—
|
—
|
(58)
|
6,187
|
Equity cash products
|
835
|
14
|
—
|
—
|
—
|
(22)
|
(28)
|
—
|
—
|
—
|
799
|
Private equity investments
|
900
|
19
|
(6)
|
—
|
(2)
|
2
|
(44)
|
—
|
23
|
(12)
|
880
|
Other
|
1,271
|
1,870
|
(2,017)
|
—
|
(18)
|
(8)
|
64
|
—
|
24
|
—
|
1,186
|
Financial assets at fair value through the income
statement
|
8,500
|
2,953
|
(2,293)
|
—
|
(430)
|
353
|
(8)
|
—
|
47
|
(70)
|
9,052
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-asset backed loans
|
343
|
79
|
—
|
—
|
(157)
|
—
|
—
|
(3)
|
—
|
—
|
262
|
Asset backed securities
|
86
|
—
|
(1)
|
—
|
—
|
1
|
—
|
(1)
|
—
|
—
|
85
|
Assets at fair value through other comprehensive
income
|
429
|
79
|
(1)
|
—
|
(157)
|
1
|
—
|
(4)
|
—
|
—
|
347
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment property
|
13
|
—
|
(1)
|
—
|
—
|
—
|
(2)
|
—
|
2
|
(2)
|
10
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading portfolio liabilities
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities designated at fair value
|
(362)
|
—
|
1
|
(3)
|
—
|
(10)
|
2
|
—
|
(22)
|
25
|
(369)
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
(206)
|
18
|
—
|
—
|
10
|
268
|
1
|
—
|
300
|
(10)
|
381
|
Foreign exchange derivatives
|
(7)
|
—
|
—
|
—
|
(12)
|
89
|
—
|
—
|
5
|
(8)
|
67
|
Credit derivatives
|
198
|
(258)
|
11
|
—
|
(376)
|
151
|
1
|
—
|
2
|
8
|
(263)
|
Equity derivatives
|
(819)
|
(448)
|
(1)
|
—
|
17
|
(90)
|
—
|
—
|
(5)
|
(23)
|
(1,369)
|
Net derivative financial instruments1
|
(834)
|
(688)
|
10
|
—
|
(361)
|
418
|
2
|
—
|
302
|
(33)
|
(1,184)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
10,010
|
4,594
|
(3,252)
|
(3)
|
(1,028)
|
548
|
(6)
|
(4)
|
507
|
(432)
|
10,934
|
1
|
Derivative financial instruments are represented on a net basis. On
a gross basis, derivative financial assets were £7,748m and
derivative financial liabilities were £8,932m.
|
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 30.06.21
|
Half year ended 30.06.20
|
|
Income statement
|
Other compre hensive income
|
Total
|
Income statement
|
Other compre hensive income
|
Total
|
|
Trading income
|
Other income
|
Trading income
|
Other income
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Trading portfolio assets
|
35
|
—
|
—
|
35
|
(177)
|
—
|
—
|
(177)
|
Financial assets at fair value through the income
statement
|
(201)
|
114
|
—
|
(87)
|
397
|
(53)
|
—
|
344
|
Financial assets at fair value through other comprehensive
income
|
—
|
—
|
—
|
—
|
—
|
—
|
(2)
|
(2)
|
Investment properties
|
—
|
—
|
—
|
—
|
—
|
(2)
|
—
|
(2)
|
Trading portfolio liabilities
|
(6)
|
—
|
—
|
(6)
|
—
|
—
|
—
|
—
|
Financial liabilities designated at fair value
|
7
|
—
|
—
|
7
|
(16)
|
(1)
|
—
|
(17)
|
Net derivative financial instruments
|
(367)
|
—
|
—
|
(367)
|
248
|
—
|
—
|
248
|
Non-current assets/liabilities held for sale
|
|
|
|
|
—
|
—
|
—
|
—
|
Total
|
(532)
|
114
|
—
|
(418)
|
452
|
(56)
|
(2)
|
394
|
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 2020.
Sensitivity analysis of valuations using unobservable
inputs
|
|
As at 30.06.21
|
As at 31.12.20
|
|
Favourable changes
|
Unfavourable changes
|
Favourable changes
|
Unfavourable changes
|
|
Income statement
|
Equity
|
Income statement
|
Equity
|
Income statement
|
Equity
|
Income statement
|
Equity
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Interest rate derivatives
|
52
|
—
|
(83)
|
—
|
82
|
—
|
(123)
|
—
|
Foreign exchange derivatives
|
6
|
—
|
(10)
|
—
|
6
|
—
|
(11)
|
—
|
Credit derivatives
|
53
|
—
|
(44)
|
—
|
55
|
—
|
(44)
|
—
|
Equity derivatives
|
185
|
—
|
(193)
|
—
|
174
|
—
|
(179)
|
—
|
Commodity derivatives
|
2
|
—
|
(2)
|
—
|
2
|
—
|
(2)
|
—
|
Corporate debt
|
22
|
—
|
(16)
|
—
|
16
|
—
|
(14)
|
—
|
Non-asset backed loans
|
202
|
—
|
(310)
|
—
|
190
|
3
|
(409)
|
(3)
|
Equity cash products
|
130
|
—
|
(119)
|
—
|
158
|
—
|
(141)
|
—
|
Private equity investments
|
223
|
—
|
(198)
|
—
|
199
|
—
|
(227)
|
—
|
Other1
|
18
|
—
|
(18)
|
—
|
21
|
—
|
(21)
|
—
|
Total
|
893
|
—
|
(993)
|
—
|
903
|
3
|
(1,171)
|
(3)
|
1
|
Other includes commercial real estate loans, funds and fund-linked
products, asset backed loans, issued debt, commercial paper,
government sponsored debt 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
£893m (December 2020: £906m) or to decrease fair values
by up to £993m (December 2020: £1,174m) with
substantially all the potential effect impacting profit and loss
rather than reserves.
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 2020.
Fair value adjustments
Key
balance sheet valuation adjustments are quantified
below:
|
As at 30.06.21
|
As at 31.12.20
|
|
£m
|
£m
|
Exit price adjustments derived from market bid-offer
spreads
|
(500)
|
(493)
|
Uncollateralised derivative funding
|
(80)
|
(115)
|
Derivative credit valuation adjustments
|
(210)
|
(268)
|
Derivative debit valuation adjustments
|
91
|
113
|
●
|
Exit
price adjustments derived from market bid-offer spreads increased
by £7m to £500m
|
●
|
Uncollateralised
derivative funding decreased by £35m to £80m as a result
of tightening input funding spreads
|
●
|
Derivative
credit valuation adjustments decreased by £58m to £210m
as a result of tightening input counterparty credit
spreads
|
●
|
Derivative
debit valuation adjustments decreased by £22m to £91m as
a result of tightening input Barclays Bank PLC credit
spreads
|
Portfolio exemption
The
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 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 £126m (December 2020:
£116m) for financial instruments measured at fair value and
£240m (December 2020: £247m) for financial instruments
carried at amortised cost. There are additions of £32m
(December 2020: £27m) and amortisation and releases of
£22m (December 2020: £24m) for financial instruments
measured at fair value and additions of £nil (December 2020:
£6m) and amortisation and releases of £7m (December 2020:
£14m) for financial instruments carried at amortised
cost.
Third party credit enhancements
Structured
and brokered certificates of deposit issued by the 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
£1,241m (December 2020: £1,494m).
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 those described within Note 17, Fair value of financial
instruments in the Barclays PLC Annual Report 2020.
The
following table summarises the fair value of financial assets and
liabilities measured at amortised cost on the Group’s balance
sheet.
|
As at 30.06.21
|
As at 31.12.20
|
|
Carrying amount
|
Fair value
|
Carrying amount
|
Fair value
|
Financial assets
|
£m
|
£m
|
£m
|
£m
|
Loans and advances at amortised cost
|
348,549
|
347,733
|
342,632
|
340,516
|
Reverse repurchase agreements and other similar secured
lending
|
4,459
|
4,459
|
9,031
|
9,031
|
|
|
|
|
|
Financial liabilities
|
|
|
|
|
Deposits at amortised cost
|
(500,895)
|
(500,933)
|
(481,036)
|
(481,106)
|
Repurchase agreements and other similar secured
borrowing
|
(20,005)
|
(20,005)
|
(14,174)
|
(14,174)
|
Debt securities in issue
|
(90,733)
|
(92,746)
|
(75,796)
|
(77,813)
|
Subordinated liabilities
|
(12,839)
|
(13,434)
|
(16,341)
|
(16,918)
|
12. Loans and advances and
deposits at amortised cost
|
As at 30.06.21
|
As at 31.12.20
|
|
£m
|
£m
|
Loans and advances at amortised cost to banks
|
11,032
|
8,900
|
Loans and advances at amortised cost to customers
|
309,194
|
309,927
|
Debt securities at amortised cost
|
28,323
|
23,805
|
Total loans and advances at amortised cost
|
348,549
|
342,632
|
|
|
|
Deposits at amortised cost from banks
|
17,165
|
17,343
|
Deposits at amortised cost from customers
|
483,730
|
463,693
|
Total deposits at amortised cost
|
500,895
|
481,036
|
13. Goodwill and
intangible assets
Goodwill
and intangible assets are allocated to business operations
according to business segments as follows:
|
As at 30.06.21
|
As at 31.12.20
|
|
Goodwill
|
Intangibles
|
Total
|
Goodwill
|
Intangibles
|
Total
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Barclays UK
|
3,560
|
1,570
|
5,130
|
3,560
|
1,618
|
5,178
|
Barclays International
|
286
|
2,735
|
3,021
|
289
|
2,435
|
2,724
|
Head Office
|
42
|
3
|
45
|
42
|
4
|
46
|
Total
|
3,888
|
4,308
|
8,196
|
3,891
|
4,057
|
7,948
|
The
Group performed an impairment review to assess the recoverability
of its goodwill and intangible asset balances as at 31 December
2020. The outcome of this review is disclosed on pages 332-335 of
the Barclays PLC Annual Report 2020. The review highlighted that
there had been a significant reduction in the value in use of the
Personal Banking and Business Banking cash generating units within
Barclays UK. No impairment was recognised as a result of the review
as value in use exceeded carrying amount. Since the 2020 impairment
review, management have observed improvements in the UK
macroeconomic environment and interest rate outlook. The
Group’s goodwill and intangible assets have been reviewed for
indicators of impairment in the period, with no indicators being
identified.
14. Subordinated
liabilities
|
Half year ended 30.06.21
|
Year ended 31.12.20
|
|
£m
|
£m
|
Opening balance as at 1 January
|
16,341
|
18,156
|
Issuances
|
1,734
|
1,438
|
Redemptions
|
(4,534)
|
(3,464)
|
Other
|
(702)
|
211
|
Closing balance
|
12,839
|
16,341
|
Issuances
of £1,734m comprise £855m EUR 1.125% Fixed Rate Resetting
Subordinated Callable Notes and £724m USD 3.811% Fixed Rate
Resetting Subordinated Callable Notes, both issued externally by
Barclays PLC and £82m ZAR Floating Rate Notes and £73m
USD Floating Rate Notes issued externally by Barclays
subsidiaries.
Redemptions
of £4,534m comprise £1,961m GBP 10% Fixed Rate
Subordinated Notes, £1,339m EUR 6% Fixed Rate Subordinated
Notes, £1,075m USD 10.179% Fixed Rate Subordinated Notes and
£86m EUR Subordinated Floating Rate Notes, issued externally
by Barclays Bank PLC and £73m USD Floating Rate Notes issued
externally by a Barclays subsidiary.
Other
movements predominantly comprise foreign exchange movements and
fair value hedge adjustments.
15. Provisions
|
As at 30.06.21
|
As at 31.12.20
|
|
£m
|
£m
|
Customer redress
|
449
|
497
|
Legal, competition and regulatory matters
|
223
|
268
|
Redundancy and restructuring
|
88
|
158
|
Undrawn contractually committed facilities and
guarantees
|
713
|
1,064
|
Onerous contracts
|
14
|
28
|
Sundry provisions
|
285
|
289
|
Total
|
1,772
|
2,304
|
16. Retirement
benefits
As at
30 June 2021, the Group’s IAS 19 pension surplus across all
schemes was £2.4bn (December 2020: £1.5bn). The UK
Retirement Fund (UKRF), which is the Group’s main scheme, had
an IAS 19 pension surplus of £2.6bn (December 2020:
£1.8bn). The movement for the UKRF was driven by payment of
deficit reduction contributions, and an increase in the discount
rate, partially offset by higher than expected long-term price
inflation.
UKRF funding valuations
The
latest annual update as at 30 September 2020 showed the funding
deficit had improved to £0.9bn from the £2.3bn shown at
the 30 September 2019 triennial valuation. The improvement was
mainly due to £1.0bn of deficit reduction contributions paid
over the year. The deficit recovery plan agreed at the last
triennial valuation requires deficit reduction contributions from
Barclays Bank PLC of £700m in 2021, £294m in 2022 and
£286m in 2023. The deficit reduction contributions are in
addition to the regular contributions to meet the Group’s
share of the cost of benefits accruing over each year. £350m
of the 2021 deficit reduction contributions were paid in April
2021, with the remaining £350m for 2021 due in September 2021.
The next triennial actuarial valuation of the UKRF is due to be
completed in 2023 with an effective date of 30 September
2022.
17. Called up share
capital
|
Ordinary share capital
|
Share premium
|
Total share capital and share premium
|
Half year ended 30.06.21
|
£m
|
£m
|
£m
|
Opening balance as at 1 January
|
4,340
|
297
|
4,637
|
Issue of shares under employee share schemes
|
3
|
22
|
25
|
Repurchase of shares
|
(94)
|
—
|
(94)
|
Closing balance
|
4,249
|
319
|
4,568
|
Called
up share capital comprised 16,998m (December 2020: 17,359m)
ordinary shares of 25p each. The decrease is mainly due to the
repurchase of 377m shares as part of the £0.7bn share buyback,
partially offset by an increase due to the issuance of shares under
employee share schemes.
18. Other equity
instruments
|
Half year ended 30.06.21
|
Year ended 31.12.20
|
|
£m
|
£m
|
Opening balance as at 1 January
|
11,172
|
10,871
|
Issuances
|
—
|
1,142
|
Redemptions
|
—
|
(831)
|
Securities held by the Group
|
(5)
|
(10)
|
Closing balance
|
11,167
|
11,172
|
Other
equity instruments of £11,167m (December 2020: £11,172m)
include AT1 securities issued by Barclays PLC. There have been no
issuances or redemptions in the period.
The AT1
securities are perpetual securities with no fixed maturity and are
structured to qualify as AT1 instruments under prevailing capital
rules applicable as at the relevant issue date. AT1 securities are
undated and are redeemable, at the option of Barclays PLC, in whole
on (i) the initial call date, or on any fifth anniversary after the
initial call date or (ii) any day falling in a named period ending
on the initial reset date, or on any fifth anniversary after the
initial reset date. In addition, the AT1 securities are redeemable,
at the option of Barclays PLC, in whole in the event of certain
changes in the tax or regulatory treatment of the securities. Any
redemptions 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 Group fall below 7%.
19. Other
reserves
|
As at 30.06.21
|
As at 31.12.20
|
|
£m
|
£m
|
Currency translation reserve
|
2,376
|
2,871
|
Fair value through other comprehensive income reserve
|
(245)
|
5
|
Cash flow hedging reserve
|
664
|
1,575
|
Own credit reserve
|
(1,001)
|
(954)
|
Other reserves and treasury shares
|
1,062
|
964
|
Total
|
2,856
|
4,461
|
Currency translation reserve
The
currency translation reserve represents the cumulative gains and
losses on the retranslation of the Group’s net investment in
foreign operations, net of the effects of hedging.
As at
30 June 2021, there was a credit balance of £2,376m (December
2020: £2,871m credit) in the currency translation reserve. The
£495m debit movement principally reflects the strengthening of
GBP against USD and EUR during the period.
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 2021, there was a debit balance of £245m (December
2020: £5m credit) in the fair value through other
comprehensive income reserve. The loss of £250m is principally
driven by a loss of £325m from the decrease in fair value of
bonds due to increasing bond yields and £199m of net gains
transferred to the income statement. This is partially offset by a
gain of £114m due to an increase in the Absa Group Limited
share price and a tax credit of £168m. £8m release in
impairment was also noted during the period.
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 2021, there was a credit balance of £664m (December
2020: £1,575m credit) in the cash flow hedging reserve. The
decrease of £911m principally reflects a £902m decrease
in the fair value of interest rate swaps held for hedging purposes
as major interest rate forward curves increased and £287m of
gains transferred to the income statement. This is partially offset
by a tax credit of £282m.
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 2021, there was a debit balance of £1,001m (December
2020: £954m debit) in the own credit reserve. The movement of
£47m principally reflects a £266m loss from the
tightening of Barclays’ funding spreads. This is partially
offset by other activity of £100m and a tax credit of
£115m.
Other reserves and treasury shares
Other
reserves relate to redeemed ordinary and preference shares issued
by the Group. Treasury shares relate to Barclays PLC shares held
principally in relation to the Group’s various share
schemes.
As at
30 June 2021, there was a credit balance of £1,062m (December
2020: £964m credit) in other reserves and treasury shares.
This is driven by an increase of £94m due to the repurchase of
377m shares as part of the £0.7bn share buyback and a £4m
increase due to a reduction in treasury shares held in relation to
employee share schemes.
20. Contingent
liabilities and commitments
|
As at 30.06.21
|
As at 31.12.20
|
Contingent liabilities
|
£m
|
£m
|
Guarantees and letters of credit pledged as collateral
security
|
13,519
|
15,665
|
Performance guarantees, acceptances and endorsements
|
5,679
|
5,944
|
Total
|
19,198
|
21,609
|
|
|
|
Commitments
|
|
|
Documentary credits and other short-term trade related
transactions
|
1,017
|
1,086
|
Standby facilities, credit lines and other commitments
|
345,281
|
331,963
|
Total
|
346,298
|
333,049
|
In
addition to the above, Note 21, 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.
21. Legal, competition and
regulatory matters
The
Group faces legal, competition and regulatory challenges, many of
which are beyond our control. The extent of the impact 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 applicable to Note 15, Provisions. We
have not disclosed an estimate of the potential financial impact or
effect on the Group of contingent liabilities where it is not
currently practicable to do so. Various matters detailed in this
note seek damages of an unspecified amount. While certain matters
specify the damages claimed, such claimed amounts do not
necessarily reflect the Group’s potential financial exposure
in respect of those matters.
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
related civil action
FCA proceedings
In
2008, Barclays Bank PLC and Qatar Holdings LLC entered into two
advisory service agreements (the Agreements). The Financial Conduct
Authority (FCA) conducted an investigation into whether the
Agreements may have related to Barclays PLC’s capital
raisings in June and November 2008 (the Capital Raisings) and
therefore should have been disclosed in the announcements or public
documents relating to the Capital Raisings. In 2013, the FCA issued
warning notices (the Notices) finding that Barclays PLC and
Barclays Bank PLC acted recklessly and in breach of certain
disclosure-related listing rules, and that Barclays PLC was also in
breach of Listing Principle 3. The financial penalty provided in
the Notices is £50m. Barclays PLC and Barclays Bank PLC
continue to contest the findings. Following the conclusion of the
Serious Fraud Office (SFO) proceedings against certain former
Barclays executives resulting in their acquittals, the FCA
proceedings, which were stayed, have resumed.
Civil action
In
2021, the High Court of Justice (High Court) dismissed a claim
brought by PCP Capital Partners LLP and PCP International Finance
Limited (PCP) against Barclays Bank PLC for fraudulent
misrepresentation and deceit, arising from certain statements made
by Barclays Bank PLC to PCP relating to the November 2008 capital
raising. PCP’s application to appeal the High Court’s
decision has also been refused which concludes these
proceedings.
Investigations into LIBOR and other benchmarks and related civil
actions
Regulators
and law enforcement agencies, including certain competition
authorities, from a number of governments have conducted
investigations relating to Barclays Bank PLC’s involvement in
allegedly manipulating certain financial benchmarks, such as LIBOR.
The SFO closed its investigation with no action to be taken against
the Group. Various individuals and corporates in a range of
jurisdictions have threatened or brought civil actions against the
Group and other banks in relation to the alleged manipulation of
LIBOR and/or other benchmarks.
USD LIBOR civil actions
The
majority of the USD LIBOR cases, which have been filed in various
US jurisdictions, have been consolidated for pre-trial purposes in
the US District Court in the Southern District of New York (SDNY).
The complaints are substantially similar and allege, among other
things, that Barclays PLC, Barclays Bank PLC, Barclays Capital Inc.
(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.
Putative
class actions and individual actions seek unspecified damages with
the exception of three lawsuits, in which the plaintiffs are
seeking a combined total of approximately $100m in actual damages
and additional punitive damages against all defendants, including
Barclays Bank PLC. Some of the lawsuits also seek trebling of
damages under the Antitrust Act and RICO. Barclays Bank PLC has
previously settled certain claims. Two class action settlements
where Barclays Bank PLC has respectively paid $7.1m and $20m, have
received final court approval. Barclays Bank PLC also settled a
further matter for $7.5m, paid in June 2021.
Sterling LIBOR civil actions
In
2016, two putative class actions filed in the SDNY against Barclays
Bank PLC, BCI and other Sterling LIBOR panel banks alleging, among
other things, that the defendants manipulated the Sterling LIBOR
rate in violation of the Antitrust Act, CEA and RICO, were
consolidated. The defendants’ motion to dismiss the claims
was granted in 2018. The plaintiffs have appealed the
dismissal.
Japanese Yen LIBOR civil actions
In
2012, a putative class action was filed in the SDNY against
Barclays Bank PLC and other Japanese Yen LIBOR panel banks by a
lead plaintiff involved in exchange-traded derivatives and members
of the Japanese Bankers Association’s Euroyen Tokyo Interbank
Offered Rate (Euroyen TIBOR) panel. The complaint alleges, among
other things, manipulation of the Euroyen TIBOR and Yen LIBOR rates
and breaches of the CEA and the Antitrust Act. In 2014, the court
dismissed the plaintiff’s antitrust claims, and, in 2020, the
court dismissed the plaintiff’s remaining CEA claims. The
plaintiff has appealed the lower court’s dismissal of such
claims.
In
2015, a second putative class action, making similar allegations to
the above class action, was filed in the SDNY against Barclays PLC,
Barclays Bank PLC and BCI. The plaintiffs filed an amended
complaint in 2020, and the defendants have filed a motion to
dismiss.
SIBOR/SOR civil action
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). In 2018, the court dismissed all
claims against Barclays PLC, Barclays Bank PLC and BCI. The
plaintiffs’ appeal of the dismissal of their claims was
granted in March 2021 and the matter has been remanded to the lower
court for further proceedings.
ICE LIBOR civil actions
In
2019, several putative class actions were filed in the SDNY against
a panel of banks, including Barclays PLC, Barclays Bank PLC, BCI,
other financial institution defendants and Intercontinental
Exchange Inc. and certain of its affiliates (ICE), asserting
antitrust claims that defendants manipulated USD LIBOR through
defendants’ submissions to ICE. These actions have been
consolidated. The defendants’ motion to dismiss was granted
in 2020. The plaintiffs have appealed the dismissal.
In
August 2020, an ICE LIBOR-related action was filed by a group of
individual plaintiffs in the US District Court for the Northern
District of California on behalf of individual borrowers and
consumers of loans and credit cards with variable interest rates
linked to USD ICE LIBOR. Plaintiffs have filed motions seeking,
among other things, preliminary and permanent injunctions to enjoin
the defendants from continuing to set LIBOR or enforce any
financial instrument that relies in whole or in part on USD
LIBOR.
Non-US benchmarks civil actions
Legal
proceedings (which include the claims referred to below in
‘Local authority civil actions concerning LIBOR’) have
been brought or threatened against Barclays Bank PLC (and, in
certain cases, Barclays Bank UK PLC) in the UK in connection with
alleged manipulation of LIBOR, EURIBOR and other benchmarks.
Proceedings have also been brought in a number of other
jurisdictions in Europe and Israel. Additional proceedings in other
jurisdictions may be brought in the future.
Credit Default Swap civil action
In July
2021, the New Mexico Attorney General, on behalf of the New Mexico
State Investment Council, filed an antitrust class action in the US
District Court for the District of New Mexico against Barclays PLC,
Barclays Bank PLC, BCI and other financial institutions. The
plaintiff alleges that the defendants conspired to manipulate the
benchmark price used to value Credit Default Swap (CDS) contracts
at settlement (i.e. the CDS final auction price). The plaintiff
alleges violations of the Antitrust Act and the CEA, and unjust
enrichment under state law.
Foreign Exchange investigations and related civil
actions
In
2015, the Group reached settlements totalling approximately $2.38bn
with various US federal and state authorities and the FCA in
relation to investigations into certain sales and trading practices
in the Foreign Exchange market. The Group continues to provide
relevant information to certain authorities.
The
European Commission is one of a number of authorities still
conducting an investigation into certain trading practices in
Foreign Exchange markets. The European Commission announced two
settlements in May 2019 and the Group paid penalties totalling
approximately €210m. In June 2019, the Swiss Competition
Commission announced two settlements and the Group paid penalties
totalling approximately CHF 27m. The financial impact of the
ongoing matters is not expected to be material to the Group’s
operating results, cash flows or financial position.
Various
individuals and corporates in a range of jurisdictions have
threatened or brought civil actions against the Group and other
banks in relation to alleged manipulation of Foreign Exchange
markets.
FX opt out civil action
In
2018, Barclays Bank PLC and BCI settled a consolidated action filed
in the SDNY, alleging manipulation of Foreign Exchange markets
(Consolidated FX Action), for a total amount of $384m. Also in
2018, a group of plaintiffs who opted out of the Consolidated FX
Action filed a complaint in the SDNY against Barclays PLC, Barclays
Bank PLC, BCI and other defendants. Some of the plaintiff’s
claims were dismissed in 2020.
Retail basis civil action
In
2015, a putative class action was filed against several
international banks, including Barclays PLC and BCI, on behalf of a
proposed class of individuals who exchanged currencies on a retail
basis at bank branches (Retail Basis Claims). The SDNY 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 the Group and all other
defendants. The plaintiffs have filed an amended
complaint.
Non-US FX civil actions
Legal
proceedings have been brought or are threatened against Barclays
PLC, Barclays Bank PLC, BCI and Barclays Execution Services Limited
(BX) in connection with alleged 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.
These
include two purported class actions filed against Barclays PLC,
Barclays Bank PLC, BX, BCI and other financial institutions in the
UK Competition Appeal Tribunal in 2019 following the settlements
with the European Commission described above. Also in 2019, a
separate claim was filed in the UK in the High Court by various
banks and asset management firms against Barclays Bank PLC and
other financial institutions alleging breaches of European and UK
competition laws related to FX trading.
Metals investigations and related civil actions
Barclays
Bank PLC previously provided information to the US Department of
Justice (DoJ), the US Commodity Futures Trading Commission and
other authorities in connection with investigations into metals and
metals-based financial instruments.
A
number of US 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 Antitrust Act and
other federal laws. This consolidated putative class action remains
pending. A separate US civil complaint by a proposed class of
plaintiffs against a number of banks, including Barclays Bank PLC,
BCI and BX, alleging manipulation of the price of silver in
violation of the CEA, the Antitrust Act and state antitrust and
consumer protection laws, has been dismissed as against the
Barclays entities. The plaintiffs have the option to seek the
court’s permission to appeal.
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.
US residential mortgage related civil actions
There
are various pending civil actions relating to US Residential
Mortgage-Backed Securities (RMBS), including four actions arising
from unresolved repurchase requests submitted by Trustees for
certain RMBS, alleging breaches of various loan-level
representations and warranties (R&Ws) made by Barclays Bank PLC
and/or a subsidiary acquired in 2007. The unresolved repurchase
requests had an original principal balance of approximately $2.1bn.
The Trustees have also alleged that the relevant R&Ws may have
been breached with respect to a greater (but unspecified) amount of
loans than previously stated in the unresolved repurchase
requests.
These
repurchase actions are ongoing. In one repurchase action, the New
York Court of Appeals held that claims related to certain R&Ws
are time-barred. Barclays Bank PLC has reached a settlement to
resolve two of the repurchase actions, which is subject to final
court approval. The financial impact of the settlement is not
expected to be material to the Group’s operating results,
cash flows or financial position. The remaining two repurchase
actions are pending.
In
2020, a civil litigation claim was filed in the New Mexico First
Judicial District Court by the State of New Mexico against six
banks, including BCI, on behalf of two New Mexico state pension
funds and the New Mexico State Investment Council relating to
legacy RMBS purchases. As to BCI, the complaint alleges that the
funds purchased approximately $22m in RMBS underwritten by BCI. The
plaintiffs have asserted claims under New Mexico state law, which
provides for the ability to claim treble damages and civil
penalties.
Government and agency securities civil actions and related
matters
Certain
governmental authorities have conducted investigations into
activities relating to the trading of certain government and agency
securities in various markets. The Group provided information in
cooperation with such investigations.
Civil
actions have also been filed on the basis of similar allegations,
as described below.
Treasury auction securities civil actions
Consolidated
putative class action complaints filed in US federal court against
Barclays Bank PLC, BCI and other financial institutions under the
Antitrust Act and state common law allege 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
court dismissed the consolidated action in March 2021. The
plaintiffs have filed an amended complaint, which the defendants
have moved to dismiss.
In
addition, certain plaintiffs have filed a related, direct action
against BCI and certain other financial institutions, alleging that
defendants conspired to fix and manipulate the US Treasury
securities market in violation of the Antitrust Act, the CEA and
state common law.
Supranational, Sovereign and Agency bonds civil
actions
Civil
antitrust actions have been filed in the SDNY and Federal Court of
Canada in Toronto against Barclays Bank PLC, BCI, BX, Barclays
Capital Securities Limited and, with respect to the civil action
filed in Canada only, Barclays Capital Canada, Inc. and other
financial institutions alleging that the defendants conspired to
fix prices and restrain competition in the market for US
dollar-denominated Supranational, Sovereign and Agency
bonds.
In one
of the actions filed in the SDNY, the court granted the
defendants’ motions to dismiss the plaintiffs’
complaint. The dismissal was affirmed on appeal. The plaintiffs
have voluntarily dismissed the other SDNY action. In the Federal
Court of Canada action, the plaintiffs reached settlements with a
small number of banks in 2020 (not including Barclays Capital
Canada, Inc.), but the plaintiffs have not commenced the class
certification process and the action remains at an early
stage.
Variable Rate Demand Obligations civil actions
Civil
actions have been filed against Barclays Bank PLC and BCI and other
financial institutions alleging the defendants conspired or
colluded to artificially inflate interest rates set for Variable
Rate Demand Obligations (VRDOs). VRDOs are municipal bonds with
interest rates that reset on a periodic basis, most commonly
weekly. Two actions in state court have been filed by private
plaintiffs on behalf of the states of Illinois and California.
Three putative class action complaints, two of which have been
consolidated, have been filed in the SDNY (the third complaint was
filed in June 2021). In the consolidated SDNY class action, certain
of the plaintiff’s claims were dismissed in November 2020. In
the California action, the plaintiffs’ claims were dismissed
in June 2021. The plaintiffs may appeal.
Government bond civil actions
In a
putative class action filed in the SDNY in 2019, plaintiffs alleged
that BCI and certain other bond dealers conspired to fix the prices
of US Government sponsored entity bonds in violation of US
antitrust law. BCI agreed to a settlement of $87m, which received
final court approval in 2020. Separately, various entities in
Louisiana, including the Louisiana Attorney General and the City of
Baton Rouge, have commenced litigation against Barclays Bank PLC
and other financial institutions making similar allegations as the
SDNY class action plaintiffs. The parties have reached a settlement
to resolve these matters. The financial impact of the settlement is
not expected to be material to the Group’s operating results,
cash flows or financial position.
In
2018, a separate putative class action against various financial
institutions including Barclays PLC, Barclays Bank PLC, BCI,
Barclays Bank Mexico, S.A., and certain other subsidiaries of the
Group was consolidated in the SDNY. The plaintiffs asserted
antitrust and state law claims arising out of an alleged conspiracy
to fix the prices of Mexican Government bonds. Barclays PLC has
settled the claim for $5.7m, which is subject to final court
approval.
Odd-lot corporate bonds antitrust class action
In
2020, BCI, together with other financial institutions, were named
as defendants in a putative class action. The complaint alleges a
conspiracy to boycott developing electronic trading platforms for
odd-lots and price fixing. Plaintiffs demand unspecified money
damages. The defendants have filed a motion to
dismiss.
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.
In
2018, trueEX LLC filed an antitrust class action in the SDNY
against a number of financial institutions including Barclays PLC,
Barclays Bank PLC and BCI based on similar allegations with respect
to trueEX LLC’s development of an IRS platform. In 2017, Tera
Group Inc. filed a separate civil antitrust action in the SDNY
claiming that certain conduct alleged in the IRS cases also caused
the plaintiff to suffer harm with respect to the Credit Default
Swaps market. In 2018 and 2019, respectively, the court dismissed
certain claims in both cases for unjust enrichment and tortious
interference but denied motions to dismiss the federal and state
antitrust claims, which remain pending.
BDC Finance L.L.C.
In
2008, BDC Finance L.L.C. (BDC) filed a complaint in the Supreme
Court of the State of New York (NY Supreme Court), demanding
damages of $298m, alleging that Barclays Bank PLC had breached a
contract in connection with a portfolio of total return swaps
governed by an ISDA Master Agreement (the Agreement). Following a
trial, the court ruled in 2018 that Barclays Bank PLC was not a
defaulting party, which was affirmed on appeal. In April 2021, the
trial court entered judgement in favour of Barclays Bank PLC for
$3.3m and as yet to be determined legal fees and costs, BDC has
appealed.
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. This case is currently stayed.
Civil actions in respect of the US Anti-Terrorism Act
There
are a number of civil actions, on behalf of more than 4,000
plaintiffs, filed in US federal courts in the US District Court in
the Eastern District of New York (EDNY) and SDNY against Barclays
Bank PLC and a number of other banks. The complaints generally
allege that Barclays Bank PLC and those banks engaged in a
conspiracy to facilitate US dollar-denominated transactions for the
Iranian Government and various Iranian banks, which in turn funded
acts of terrorism that injured or killed plaintiffs or
plaintiffs’ family members. The plaintiffs seek to recover
damages for pain, suffering and mental anguish under the provisions
of the US Anti-Terrorism Act, which allow for the trebling of any
proven damages.
The
court granted the defendants’ motions to dismiss three out of
the six actions in the EDNY. Plaintiffs have appealed in one
action. The remaining actions are stayed pending decisions on the
appeal. Out of the two actions in the SDNY, the court also granted
the defendants’ motion to dismiss one action. The remaining
action is stayed pending any appeal in the former
case.
Shareholder derivative action
In
November 2020, a purported Barclays shareholder filed a putative
derivative action in New York state court against BCI and a number
of current and former members of the Board of Directors of Barclays
PLC and senior executives or employees of the Group. The
shareholder filed the claim on behalf of nominal defendant Barclays
PLC, alleging that the individual defendants harmed the company
through breaches of their duties, including under the Companies Act
2006. The plaintiff seeks damages on behalf of Barclays PLC for the
losses that Barclays PLC allegedly suffered as a result of these
alleged breaches. An amended complaint was filed in April 2021,
which BCI and certain other defendants have moved to
dismiss.
Derivative transactions civil action
In July
2021, Vestia (a Dutch housing association) issued a claim against
Barclays Bank PLC in the UK in the High Court in relation to a
series of derivative transactions entered into with Barclays Bank
PLC between 2008 and 2012. The claim has not been served on
Barclays.
Skilled person review and associated matters
In
August 2020, the FCA granted an application by Clydesdale Financial
Services Limited (CFS), which trades as Barclays Partner Finance
and houses Barclays’ point-of-sale finance business, for a
validation order with respect to certain loans to customers
brokered by Azure Services Limited (ASL), a timeshare operator,
which did not, at the point of sale, hold the necessary broker
licence. As a condition to the validation order, the FCA required
CFS to undertake a skilled person review of the assessment of
affordability processes for the loans brokered by ASL (ASL Loans)
as well as CFS’ policies and procedures for assessing
affordability and oversight of brokers more generally, and dictated
a remediation methodology in the event that ASL Loans did not pass
the affordability test. CFS has voluntarily agreed to remediate the
ASL Loans, which is expected to amount to £37m, in accordance
with the FCA’s methodology. The remaining scope of the
skilled person review is ongoing and the skilled person is expected
to report in the fourth quarter of 2021.
It is
not currently possible to predict the outcome of the skilled person
review and/or whether remediation activity will be undertaken or
required in relation to other parts of CFS’ loan portfolio
and the scope of, and methodology for, any such
remediation.
2. Barclays PLC, Barclays Bank PLC and Barclays Bank UK
PLC
Investigation into UK cards’ affordability
The FCA
is investigating certain aspects of the affordability assessment
processes used by Barclays Bank UK PLC and Barclays Bank PLC for
credit card applications made to Barclays’ UK credit card
business. Barclays is providing information in cooperation with the
investigation.
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. HMRC’s decision has been appealed to the
First Tier Tribunal (Tax Chamber).
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 and related
civil actions’, in the UK, certain local authorities have
brought claims against Barclays Bank PLC and Barclays Bank UK PLC
asserting that they entered into loans in reliance on
misrepresentations made by Barclays Bank PLC in respect of its
conduct in relation to LIBOR. Barclays Bank PLC and Barclays Bank
UK PLC were successful in their applications to strike out the
claims. One local authority has obtained permission to pursue an
appeal against this decision, while the claims brought by the other
local authorities have been settled on terms such that the parties
have agreed not to pursue these claims and to bear their own
costs.
3. Barclays PLC
Alternative trading systems
Barclays
PLC has been named as a defendant in a claim brought in the UK in
the High Court by various shareholders regarding Barclays
PLC’s share price based on the allegations contained within a
complaint by the New York State Attorney General (NYAG) in 2014.
The NYAG complaint was filed against Barclays PLC and BCI in the NY
Supreme Court alleging, among other things, that Barclays PLC and
BCI engaged in fraud and deceptive practices in connection with LX,
BCI’s SEC-registered alternative trading system. Such claim
was settled in 2016, as previously disclosed. This new shareholder
claim is seeking unquantified damages.
General
The
Group 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 the Group 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, intellectual property, money laundering, financial
crime, employment, environmental and other statutory and common law
issues.
The Group 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 the Group is or
has been engaged. The Group is cooperating with the relevant
authorities and keeping all relevant agencies briefed as
appropriate in relation to these matters and others described in
this note on an ongoing basis.
At the
present time, Barclays PLC does not expect the ultimate resolution
of any of these other matters to have a material adverse effect on
the Group’s 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 PLC’s results, operations or cash
flow for a particular period, depending on, among other things, the
amount of the loss resulting from the matter(s) and the amount of
profit otherwise reported for the reporting period.
22. Related party
transactions
Related
party transactions in the half year ended 30 June 2021 were similar
in nature to those disclosed in the Barclays PLC Annual Report
2020. No related party transactions that have taken place in the
half year ended 30 June 2021 have materially affected the financial
position or the performance of the Group during this
period.
23. Interest rate
benchmark reform
Following
the financial crisis, the reform and replacement of benchmark
interest rates such as LIBOR has become a priority for global
regulators. The FCA and other global regulators have instructed
market participants to prepare for the cessation of LIBOR after the
end of 2021, and to adopt RFRs. While it is expected that most
reforms affecting the Group will be completed by the end of 2021,
consultations and regulatory changes are in progress and as certain
US Dollar tenors will continue to be published up to mid-2023,
significant remediation efforts will continue beyond the end of
2021.
How the Group is managing the transition to alternative benchmark
rates
Barclays
has established a Group-wide LIBOR Transition Programme, further
detail on the transition programme is available in the Barclays PLC
Annual Report 2020 (page 367).
In
March 2021, the FCA announced the dates that panel bank submissions
for all LIBOR settings will cease, after which representative LIBOR
rates will no longer be available, these are: immediately after 31
December 2021, in the case of all sterling, euro, Swiss franc and
Japanese yen settings, and the 1-week and 2-month US dollar
settings; and immediately after 30 June 2023, in the case of the
remaining US dollar settings. Throughout 2021, the FCA will consult
with market participants to require continued publication on a
‘synthetic’ basis for some sterling LIBOR settings and,
for 1 additional year, some Japanese yen LIBOR
settings.
Approaches
to transition exposure expiring post the expected end dates for
LIBOR vary by product and nature of counterparty. The transition we
are undertaking is at the request of the regulators, in line with
their expectations and according to the regulatory endorsed
timetable. The rates to which clients and customers are being
transitioned are endorsed by the regulators. We are making
disclosures as part of the transition to clarify the rate to be
applied and the potential risks inherent in the transition.
Barclays is actively engaging with counterparties to transition or
include appropriate fallback provisions and transition mechanisms
in its floating rate assets and liabilities with maturities after
2021, when most IBORs are expected to cease to be published, or
will be published on a non-representative basis for a limited
time.
Barclays
is working with central clearing counterparties where the
transition of cleared derivative contracts will follow a
market-wide, standardised approach to reform. Barclays is working
to the UK Risk Free Rate Working Group (RFRWG) target of completion
of active conversion of, and/or addition of robust fallbacks to
legacy GBP LIBOR contracts, where viable by the end of Q321.
Additionally, plans are in place to address non-GBP and other
official sector industry milestones and targets.
Progress made during H121
Building
on the progress made in 2020, the Group has delivered further
alternative RFR product capabilities and alternatives to LIBOR
across loans, bonds and derivatives. Client outreach is progressing
to plan and we have continued to engage actively with customers and
counterparties to transition or include the appropriate fallback
provisions. The Group has in place detailed plans, processes and
procedures to support the transition of the remainder during 2021.
Barclays has adhered to the ISDA IBOR Fallbacks Protocol for its
major derivative dealing entities and we continue to track progress
and engage with clients on their own adherence. Following the
progress made during 2020, the Group continues to deliver
technology and business process changes in preparation for LIBOR
cessation and transitions to RFRs that will be necessary during
2021 and beyond in line with official sector expectations and
milestones.
The
Group met the Q121 UK RFRWG milestone to cease initiation of GBP
LIBOR linked loans, securitisations or linear derivatives and the
Q221 milestones to cease initiation of new non-linear derivatives,
exchange traded futures and Bank Of Japan milestone to cease
issuance of JPY LIBOR linked loans and bonds. The Group has put in
place controls so that any exceptions or exemptions are approved,
and is taking a similar approach to forthcoming
cessation
24. Barclays PLC parent
company balance sheet
|
As at 30.06.21
|
As at 31.12.20
|
Assets
|
£m
|
£m
|
Investment in subsidiaries
|
58,828
|
58,886
|
Loans and advances to subsidiaries
|
23,295
|
24,710
|
Financial assets at fair value through the income
statement
|
21,046
|
17,521
|
Derivative financial instruments
|
2
|
7
|
Other assets
|
19
|
65
|
Total assets
|
103,190
|
101,189
|
|
|
|
Liabilities
|
|
|
Deposits at amortised cost
|
476
|
482
|
Cash collateral and settlement balances
|
—
|
—
|
Debt securities in issue
|
26,663
|
28,428
|
Subordinated liabilities
|
9,170
|
7,724
|
Financial liabilities designated at fair value
|
12,130
|
9,507
|
Other liabilities
|
135
|
176
|
Total liabilities
|
48,574
|
46,317
|
|
|
|
Equity
|
|
|
Called up share capital
|
4,249
|
4,340
|
Share premium account
|
319
|
297
|
Other equity instruments
|
11,169
|
11,169
|
Other reserves
|
488
|
394
|
Retained earnings
|
38,391
|
38,672
|
Total equity
|
54,616
|
54,872
|
|
|
|
Total liabilities and equity
|
103,190
|
101,189
|
Investment in subsidiaries
The
investment in subsidiaries of £58,828m (December 2020:
£58,886m) predominantly relates to investments in Barclays
Bank PLC and Barclays Bank UK PLC, as well as holdings of their AT1
securities of £10,995m (December 2020: £10,995m).
Barclays PLC considers the carrying value of its investment in
subsidiaries to be fully recoverable.
Financial assets and liabilities designated at fair
value
Financial
liabilities designated at fair value of £12,130m (December
2020: £9,507m) comprises material issuances during the period
of €750m Floating Notes, $1,000m Fixed Rate Resetting Senior
Callable Notes, 600m AUD Fixed-to-Floating and Floating Rate Debt
Instruments, and 77,000m JPY Fixed Rate Resetting Senior Callable
Notes. 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 £21,046m (December 2020:
£17,521m).
Loans and advances to subsidiaries
During
the period, loans and advances to subsidiaries decreased by
£1,415m to £23,295m (December 2020: £24,710m). The
decrease was driven by the maturity of £2,200m senior loans to
Barclays Bank PLC and a foreign exchange impact of £500m due
to appreciation of GBP against major currencies (although the
negative FX impact is offset across the balance sheet liabilities).
There was also a £700m decrease in relation to the share
buyback which took place in Q1 2020. This decrease was partially
offset by £1,600m of new issuances of dated subordinated notes
by Barclays Bank PLC to Barclays PLC and £776m dividend
receipts from Barclays Bank PLC and Barclays Execution Services
Limited.
Subordinated liabilities and debt securities in issue
During
H121, Barclays PLC issued €1,000m and $1,000m of Fixed Rate
Resetting Subordinated Callable Notes, which is included within the
subordinated liabilities balance of £9,170m (December 2020:
£7,724m). Debt securities in issue of £26,663m (December
2020: £28,428m) have reduced in the year due to the
£2,200m maturity of senior issuances, offset in part by new
issuances of €1,250m.
Other equity instruments
Other
equity instruments comprises AT1 securities issued by Barclays PLC.
There have been no new issuances or redemptions during the
period.
Other reserves
As at
30 June 2021, there was a balance of £488m (December 2020:
£394m) in other reserves. The increase is due to the
repurchase of shares as part of the share buyback.
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 Group
subsidiaries such as Barclays Execution Services Limited and the US
Intermediate Holding Company (IHC).
Appendix: Non-IFRS Performance Measures
The
Group’s 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 Group. They also
reflect an important aspect of the way in which operating targets
are defined and performance is monitored by
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. The components of the calculation have been included on page
50.
|
Period end allocated tangible equity
|
Allocated
tangible equity is calculated as 13.5% (2020: 13.0%) of RWAs for
each business, adjusted for capital deductions, excluding goodwill
and intangible assets, reflecting the assumptions the Group uses
for capital planning purposes. Head Office allocated tangible
equity represents the difference between the 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 98 to
100.
|
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 98 to
101.
|
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 27. Quoted as zero across the current reporting
period due to credit impairment net release.
|
Net interest margin
|
Annualised
net interest income divided by the sum of average customer assets.
The components of the calculation have been included on pages 23 to
24.
|
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
102.
|
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 13.5% (2020: 13.0%) of RWAs for each
business, adjusted for capital deductions, excluding goodwill and
intangible assets, reflecting the assumptions the Group uses for
capital planning purposes. Head Office average allocated tangible
equity represents the difference between the 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 30.06.21
|
£m
|
|
£bn
|
|
%
|
Barclays UK
|
1,019
|
|
9.9
|
|
20.6
|
Corporate and Investment Bank
|
2,312
|
|
28.3
|
|
16.3
|
Consumer, Cards and Payments
|
386
|
|
4.0
|
|
19.1
|
Barclays International
|
2,698
|
|
32.3
|
|
16.7
|
Head Office
|
95
|
|
4.3
|
|
n/m
|
Barclays Group
|
3,812
|
|
46.5
|
|
16.4
|
|
|
|
|
|
|
Half year ended 30.06.20
|
|
|
|
|
|
Barclays UK
|
52
|
|
10.2
|
|
1.0
|
Corporate and Investment Bank
|
1,514
|
|
27.7
|
|
11.0
|
Consumer, Cards and Payments
|
(517)
|
|
4.7
|
|
(21.9)
|
Barclays International
|
997
|
|
32.4
|
|
6.2
|
Head Office
|
(354)
|
|
6.0
|
|
n/m
|
Barclays Group
|
695
|
|
48.6
|
|
2.9
|
|
|
|
|
|
|
|
|
Half year ended 30.06.21
|
|
Barclays UK
|
Corporate and Investment Bank
|
Consumer, Cards and Payments
|
Barclays International
|
Head Office
|
Barclays Group
|
Return on average tangible shareholders' equity
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Attributable profit
|
1,019
|
2,312
|
386
|
2,698
|
95
|
3,812
|
|
|
|
|
|
|
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Average shareholders' equity
|
13.5
|
28.3
|
4.6
|
32.9
|
8.0
|
54.4
|
Average goodwill and intangibles
|
(3.6)
|
—
|
(0.6)
|
(0.6)
|
(3.7)
|
(7.9)
|
Average tangible shareholders' equity
|
9.9
|
28.3
|
4.0
|
32.3
|
4.3
|
46.5
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity
|
20.6%
|
16.3%
|
19.1%
|
16.7%
|
n/m
|
16.4%
|
|
Half year ended 30.06.20
|
|
Barclays UK
|
Corporate and Investment Bank
|
Consumer, Cards and Payments
|
Barclays International
|
Head Office
|
Barclays Group
|
Return on average tangible shareholders' equity
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Attributable profit/(loss)
|
52
|
1,514
|
(517)
|
997
|
(354)
|
695
|
|
|
|
|
|
|
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Average shareholders' equity
|
13.8
|
27.7
|
5.4
|
33.1
|
9.9
|
56.8
|
Average goodwill and intangibles
|
(3.6)
|
—
|
(0.7)
|
(0.7)
|
(3.9)
|
(8.2)
|
Average tangible shareholders' equity
|
10.2
|
27.7
|
4.7
|
32.4
|
6.0
|
48.6
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity
|
1.0%
|
11.0%
|
(21.9)%
|
6.2%
|
n/m
|
2.9%
|
Barclays Group
|
|
|
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Attributable profit/(loss)
|
2,108
|
1,704
|
|
220
|
611
|
90
|
605
|
|
681
|
(292)
|
|
|
|
|
|
|
|
|
|
|
|
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Average shareholders' equity
|
54.4
|
54.4
|
|
55.7
|
56.4
|
58.4
|
55.2
|
|
54.5
|
56.4
|
Average goodwill and intangibles
|
(7.9)
|
(7.9)
|
|
(8.1)
|
(8.1)
|
(8.2)
|
(8.2)
|
|
(8.1)
|
(8.0)
|
Average tangible shareholders' equity
|
46.5
|
46.5
|
|
47.6
|
48.3
|
50.2
|
47.0
|
|
46.4
|
48.4
|
|
|
|
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity
|
18.1%
|
14.7%
|
|
1.8%
|
5.1%
|
0.7%
|
5.1%
|
|
5.9%
|
(2.4)%
|
Barclays UK
|
|
|
|
|
|
|
|
|
|
|
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Return on average allocated tangible equity
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Attributable profit/(loss)
|
721
|
298
|
|
160
|
113
|
(123)
|
175
|
|
438
|
(907)
|
|
|
|
|
|
|
|
|
|
|
|
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Average allocated equity
|
13.5
|
13.5
|
|
13.4
|
13.7
|
13.9
|
13.7
|
|
13.8
|
13.9
|
Average goodwill and intangibles
|
(3.6)
|
(3.6)
|
|
(3.6)
|
(3.6)
|
(3.6)
|
(3.6)
|
|
(3.5)
|
(3.5)
|
Average allocated tangible equity
|
9.9
|
9.9
|
|
9.8
|
10.1
|
10.3
|
10.1
|
|
10.3
|
10.4
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
29.1%
|
12.0%
|
|
6.5%
|
4.5%
|
(4.8)%
|
6.9%
|
|
17.0%
|
(34.9)%
|
Barclays International
|
|
|
|
|
|
|
|
|
|
|
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Return on average allocated tangible equity
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Attributable profit
|
1,267
|
1,431
|
|
441
|
782
|
468
|
529
|
|
397
|
799
|
|
|
|
|
|
|
|
|
|
|
|
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Average allocated equity
|
33.0
|
32.8
|
|
31.1
|
31.2
|
34.2
|
31.9
|
|
31.9
|
33.3
|
Average goodwill and intangibles
|
(0.6)
|
(0.5)
|
|
(0.6)
|
(0.6)
|
(0.7)
|
(0.7)
|
|
(1.0)
|
(1.1)
|
Average allocated tangible equity
|
32.4
|
32.3
|
|
30.5
|
30.6
|
33.5
|
31.2
|
|
30.9
|
32.2
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
15.6%
|
17.7%
|
|
5.8%
|
10.2%
|
5.6%
|
6.8%
|
|
5.1%
|
9.9%
|
Corporate and Investment Bank
|
|
|
|
|
|
|
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Return on average allocated tangible equity
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Attributable profit
|
1,049
|
1,263
|
|
413
|
627
|
694
|
820
|
|
193
|
609
|
|
|
|
|
|
|
|
|
|
|
|
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Average allocated equity
|
28.4
|
28.2
|
|
26.3
|
26.4
|
29.1
|
26.2
|
|
25.9
|
26.9
|
Average goodwill and intangibles
|
—
|
—
|
|
—
|
—
|
(0.1)
|
—
|
|
(0.1)
|
—
|
Average allocated tangible equity
|
28.4
|
28.2
|
|
26.3
|
26.4
|
29.0
|
26.2
|
|
25.8
|
26.9
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
14.8%
|
17.9%
|
|
6.3%
|
9.5%
|
9.6%
|
12.5%
|
|
3.0%
|
9.1%
|
Consumer, Cards and Payments
|
|
|
|
|
|
|
|
|
|
Q221
|
Q121
|
|
Q420
|
Q320
|
Q220
|
Q120
|
|
Q419
|
Q319
|
Return on average allocated tangible equity
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Attributable profit/(loss)
|
218
|
168
|
|
28
|
155
|
(226)
|
(291)
|
|
204
|
190
|
|
|
|
|
|
|
|
|
|
|
|
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Average allocated equity
|
4.6
|
4.6
|
|
4.8
|
4.8
|
5.1
|
5.7
|
|
6.0
|
6.4
|
Average goodwill and intangibles
|
(0.6)
|
(0.5)
|
|
(0.6)
|
(0.6)
|
(0.6)
|
(0.7)
|
|
(0.9)
|
(1.1)
|
Average allocated tangible equity
|
4.0
|
4.1
|
|
4.2
|
4.2
|
4.5
|
5.0
|
|
5.1
|
5.3
|
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
21.8%
|
16.5%
|
|
2.7%
|
14.7%
|
(20.2)%
|
(23.5)%
|
|
15.9%
|
14.2%
|
Tangible net asset value per share
|
As at 30.06.21
|
As at 31.12.20
|
As at 30.06.20
|
|
£m
|
£m
|
£m
|
Total equity excluding non-controlling interests
|
67,052
|
65,797
|
68,304
|
Other equity instruments
|
(11,167)
|
(11,172)
|
(10,871)
|
Goodwill and intangibles
|
(8,196)
|
(7,948)
|
(8,163)
|
Tangible shareholders' equity attributable to ordinary shareholders
of the parent
|
47,689
|
46,677
|
49,270
|
|
|
|
|
|
m
|
m
|
m
|
Shares in issue
|
16,998
|
17,359
|
17,345
|
|
|
|
|
|
p
|
p
|
p
|
Tangible net asset value per share
|
281
|
269
|
284
|
Shareholder Information
Results timetable1
|
|
|
Date
|
|
|
|
Ex-dividend date
|
|
|
12 August 2021
|
Dividend record date
|
|
|
13 August 2021
|
Cut off time of 5:00pm (UK time) for the receipt of Dividend
Re-investment Programme (DRIP) Application Form
|
|
|
27 August 2021
|
Dividend payment date
|
|
|
17 September 2021
|
Q321 Results Announcement
|
|
|
21 October 2021
|
|
|
|
|
|
|
|
For qualifying US and Canadian resident ADR holders, the half year
dividend of 2.0p per ordinary share becomes 8.0p per ADS
(representing four shares). The ex-dividend, dividend record and
dividend payment dates for ADR holders are as shown
above.
|
|
|
|
|
|
|
|
|
|
|
% Change3
|
Exchange rates2
|
30.06.21
|
31.12.20
|
30.06.20
|
|
31.12.20
|
30.06.20
|
Period end - USD/GBP
|
1.38
|
1.37
|
1.24
|
|
1%
|
11%
|
6 month average - USD/GBP
|
1.39
|
1.31
|
1.26
|
|
6%
|
10%
|
3 month average - USD/GBP
|
1.40
|
1.32
|
1.24
|
|
6%
|
13%
|
Period end - EUR/GBP
|
1.17
|
1.12
|
1.10
|
|
4%
|
6%
|
6 month average - EUR/GBP
|
1.15
|
1.11
|
1.14
|
|
4%
|
1%
|
3 month average - EUR/GBP
|
1.16
|
1.11
|
1.13
|
|
5%
|
3%
|
|
|
|
|
|
|
|
Share price data
|
|
|
|
|
|
|
Barclays PLC (p)
|
171.12
|
146.68
|
114.42
|
|
|
|
Barclays PLC number of shares (m)
|
16,998
|
17,359
|
17,345
|
|
|
|
|
|
|
|
|
|
|
For further information please contact
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investor relations
|
Media relations
|
Chris Manners +44 (0) 20 7773 2136
|
Tom 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 20554 from the UK or +44 121 415 7004 from
overseas.
|
|
|
|
|
|
|
|
|
American Depositary Receipts (ADRs)
|
|
|
|
|
|
|
Shareowner Services
|
StockTransfer@equiniti.com
|
Tel: +1 800 990 1135 (toll free in US and Canada), +1 651 453 2128
(outside the US and Canada)
|
Shareowner Services, PO Box 64504, St Paul, MN 55164-0504,
USA.
|
|
|
|
|
|
|
|
Delivery of ADR certificates and overnight mail
|
|
|
|
|
|
|
Shareowner Services, 1110 Centre Pointe Curve, Suite 101, Mendota
Heights, MN 55120, USA.
|
|
|
|
|
|
|
|
Qualifying US and Canadian resident ADR holders should contact
Shareowner Services for further details regarding the
DRIP
|
1
|
Note that these dates are provisional and subject to
change.
|
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.
|
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