Financial Statement Notes
1.
Basis of preparation
These
condensed consolidated interim financial statements for the six
months ended 30 June 2017 have been prepared in accordance with the
Disclosure and Transparency Rules of the Financial Conduct
Authority and with IAS 34, ‘Interim Financial
Reporting’, as published by the IASB and adopted by the
European Union. The condensed consolidated interim financial
statements should be read in conjunction with the annual financial
statements for the year ended 31 December 2016, which have been
prepared in accordance with IFRSs as adopted by the European
Union.
The
accounting policies and methods of computation used in these
condensed consolidated interim financial statements are the same as
those used in the Barclays 2016 Annual Report, except for the
option in IFRS 9 to recognise changes in own credit in other
comprehensive income, which Barclays has applied from 1 January
2017. This will have no effect on net assets, and any changes due
to own credit in prior periods have not been restated. Any realised
and unrealised amounts recognised in other comprehensive income
will not be reclassified to the income statement in future
periods.
The
main differences between Barclays PLC and Barclays Bank PLC results
are set out on pages 2 to 4.
Future accounting developments
IFRS 9 – Financial instruments
IFRS 9
Financial Instruments which will replace IAS 39 Financial
Instruments: Recognition and Measurement is effective for periods
beginning on or after 1 January 2018 and was endorsed by the EU in
November 2016. IFRS 9, in particular the impairment requirements,
will lead to significant changes in the accounting for financial
instruments. Barclays will not restate comparatives on initial
application of IFRS 9 on 1 January 2018 but will provide detailed
transition disclosures in accordance with the amended requirements
of IFRS 7.
Barclays
has a jointly accountable Risk and Finance IFRS 9 implementation
programme with representation from all impacted
departments.
In
respect of the impairment and classification and measurement
implementation programmes for financial assets, work has continued
to prepare for adoption on 1 January 2018, with the focus during
2017 on quantifying impact, model validation and finalising
processes, governance and controls.
As
permitted by IFRS 9, Barclays will continue applying the IAS 39
hedge accounting requirements but will provide the new hedge
accounting disclosures required by the amended IFRS 7.
Since
the publication of the 2016 Annual Report, the IASB has issued an
Exposure Draft potentially impacting financial assets with
prepayment features with negative compensation. Such prepayment
features are present in some fixed rate corporate and investment
bank loans. If such loans are concluded to be measured at fair
value through profit or loss, the potential impact on opening
equity and profit or loss would depend on their fair values
compared to their carrying amounts, and the future changes in fair
value. The IASB is currently considering comments received on the
proposals.
Barclays
will disclose the financial impact estimates when the
implementation programme, validation and testing is further
advanced, which is expected to be no later than the Barclays Annual
Report 2017.
For
further information on this and other new standards refer to the
Barclays 2016 Annual Report.
Going concern
Having
reassessed the principal risks, the directors considered it
appropriate to adopt the going concern basis of accounting in
preparing the interim financial information.
2. Non-controlling interests
|
|
|
Profit attributable to non-controlling interests
|
|
Equity attributable to non-controlling interests
|
|
|
Half year ended
|
Half year ended
|
|
As at
|
As at
|
|
|
30.06.17
|
30.06.16
|
|
30.06.17
|
31.12.16
|
|
|
£m
|
£m
|
|
£m
|
£m
|
Barclays Africa Group Limited
|
|
140
|
155
|
|
-
|
3,507
|
Other non-controlling interests
|
|
2
|
2
|
|
84
|
15
|
Total
|
|
142
|
157
|
|
84
|
3,522
|
|
|
|
|
|
|
|
3.
Dividends
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
Dividends paid during the period
|
£m
|
£m
|
Ordinary shares
|
165
|
502
|
Preference shares
|
134
|
182
|
Total
|
299
|
684
|
|
|
|
4.
Called up share capital
Ordinary shares
At 30
June 2017 the issued ordinary share capital of Barclays Bank PLC
comprised 2,342 million (December 2016: 2,342 million) ordinary
shares of £1 each.
Preference shares
At 30
June 2017 the issued preference share capital of Barclays Bank PLC
comprised 1,000 (December 2016: 1,000) Sterling Preference Shares
of £1 each; 31,856 (December 2016: 31,856) Euro Preference
Shares of €100 each; 20,930 (December 2016: 20,930) Sterling
Preference Shares of £100 each; 58,133 (December 2016: 58,133)
US Dollar Preference Shares of $100 each; and 106 million (December
2016: 161 million) US Dollar Preference Shares of $0.25 each. In
the first quarter of 2017, 55 million US Dollar Preference Shares
of $0.25 each were redeemed.
5.
Other equity instruments
Other equity instruments of £7,736m (December 2016:
£6,486m) include Additional Tier 1 (AT1) securities issued by
Barclays Bank PLC
.
The AT1
securities are perpetual securities with no fixed maturity and are
structured to qualify as AT1 instruments under CRD
IV.
Appendix: Barclays PLC Results Announcement
Barclays PLC
Results Announcement
30 June
2017
Table of Contents
Results Announcement
|
Page
|
Notes
|
17
|
Performance
Highlights
|
18-20
|
Group
Chief Executive Officer’s Review
|
21
|
Group
Finance Director’s Review
|
22-25
|
Results
by Business
|
|
●
Barclays UK
|
26-28
|
●
Barclays International
|
29-31
|
●
Head Office
|
32
|
●
Barclays Non-Core
|
33-35
|
Discontinued
Operation Results
|
36-37
|
Quarterly
Results Summary
|
38-40
|
Quarterly
Core Results by Business
|
41-45
|
Performance Management
|
|
●
Margins and balances
|
46
|
Risk Management
|
|
●
Overview
|
47
|
●
Credit Risk
|
48-53
|
●
Market Risk
|
54
|
●
Treasury and Capital Risk
|
55-65
|
Statement
of Directors’ Responsibilities
|
66
|
Independent
Review Report to Barclays PLC
|
67
|
Condensed
Consolidated Financial Statements
|
68-73
|
Financial
Statement Notes
|
74-109
|
Appendix: Non-IFRS
Performance Measures
|
110-114
|
Shareholder
Information
|
115
|
BARCLAYS PLC, 1 CHURCHILL PLACE, LONDON, E14 5HP, UNITED KINGDOM.
TELEPHONE: +44 (0) 20 7116 1000. COMPANY NO.
48839
Notes
The
term Barclays or Group refers to Barclays PLC together with its
subsidiaries. Unless otherwise stated, the income statement
analysis compares the six months ended 30 June 2017 to the
corresponding six months of 2016 and balance sheet analysis as at
30 June 2017 with comparatives relating to 31 December 2016 and 30
June 2016. The abbreviations ‘£m’ and
‘£bn’ represent millions and thousands of millions
of Pounds Sterling respectively; the abbreviations ‘$m’
and ‘$bn’ represent millions and thousands of millions
of US Dollars respectively; 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/results.
The
information in this announcement, which was approved by the Board
of Directors on 27 July 2017, does not comprise statutory accounts
within the meaning of Section 434 of the Companies Act 2006.
Statutory accounts for the year ended 31 December 2016, which
included certain information required for the Joint Annual Report
on Form 20-F of Barclays PLC and Barclays Bank PLC to the US
Securities and Exchange Commission (SEC) and which contained an
unqualified 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 SEC as soon as
practicable following their publication. Once furnished with the
SEC, copies of the Form 6-K will also be available from the
Barclays Investor Relations website home.barclays/results and 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 business’ 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 110-114 for further information, reconciliations
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. 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, notable items,
business strategy, structural reform, capital, leverage and other
regulatory ratios, payment of dividends (including dividend pay-out
ratios and expected payment strategies), projected levels of growth
in the banking and financial markets, projected costs or savings,
original and revised commitments and targets in connection with the
Group Strategy Update, rundown of assets and businesses within
Barclays Non-Core, sell down of the Group’s interest in
Barclays Africa Group Limited or the impact of any regulatory
deconsolidation, estimates of capital expenditures and plans and
objectives for future operations, projected employee numbers and
other statements that are not historical fact. By their nature,
forward-looking statements involve risk and uncertainty because
they relate to future events and circumstances. These may be
affected by changes in legislation, the development of standards
and interpretations under International Financial Reporting
Standards, 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, future levels of notable
items, the policies and actions of governmental and regulatory
authorities, geopolitical risks and the impact of competition. In
addition, factors including (but not limited to) the following may
have an effect: capital, leverage and other regulatory rules
(including with regard to the future structure of the Group)
applicable to past, current and future periods; UK, US, Africa,
Eurozone and global macroeconomic and business conditions; the
effects of continued volatility in credit markets; market related
risks such as changes in interest rates and foreign exchange rates;
effects of changes in valuation of credit market exposures; changes
in valuation of issued securities; volatility in capital markets;
changes in credit ratings of any entities within the Group or any
securities issued by such entities; the potential for one or more
countries exiting the Eurozone; the implications of the exercise by
the United Kingdom of Article 50 of the Treaty of Lisbon and the
disruption that may result in the UK and globally from the
withdrawal of the United Kingdom from the European Union; and the
success of future acquisitions, disposals and other strategic
transactions. A number of these influences and factors are beyond
the Group’s control. As a result, the Group’s actual
future results, dividend payments, and capital and leverage ratios
may differ materially from the plans, goals, expectations and
guidance set forth in the Group’s forward-looking statements.
Additional risks and factors which may impact the Group’s
future financial condition and performance are identified in our
filings with the SEC (including, without limitation, our annual
report on form 20-F for the fiscal year ended 31 December 2016),
which are available on the SEC’s website at
www.sec.gov.
Subject
to our obligations under the applicable laws and regulations of the
United Kingdom and the United States in relation to disclosure and
ongoing information, we undertake no obligation to update publicly
or revise any forward looking statements, whether as a result of
new information, future events or otherwise.
Performance Highlights
Transatlantic Consumer, Corporate and Investment Bank with Global
Reach
Key strategic milestones achieved with the closure of Non-Core on 1
July 2017, selldown in Africa and
a CET1 ratio of 13.1% within our end-state target
range
●
Returns:
|
●
Group Return on Tangible Equity (RoTE) of (4.6%) (H116: 4.8%).
Excluding a loss on the sale of 33.7% of Barclays Africa Group
Limited’s (BAGL) issued share capital of £1.4bn, an
impairment of Barclays’ holding in BAGL of £1.1bn and
charges for Payment Protection Insurance (PPI) of £700m, Group
RoTE was 8.1%
●
Core RoTE of 7.3% (H116: 12.5%). Excluding charges for PPI, Core
delivered a double digit RoTE of 10.4% on an average allocated
tangible equity base that was £5bn higher
year-on-year
|
●
Non-Core rundown and closure:
|
●
Closure of Non-Core on 1 July 2017 with risk weighted assets of
£23bn (December 2016: £32bn), below guidance of
approximately £25bn. Residual assets and liabilities are to be
reintegrated into the Core
●
Materially lower loss before tax of £647m (H116:
£1,904m)
|
●
Cost efficiency:
|
●
Group cost: income ratio of 71% (H116: 70%) reflected a significant
reduction in Non-Core costs to £284m (H116: £950m) and
charges for PPI of £700m (H116: £400m)
●
Remain on track to deliver Group cost: income ratio below 60% over
time
|
●
Barclays Africa Group Limited (BAGL):
|
●
Sale of 33.7% of BAGL’s issued share capital, resulting in
the accounting deconsolidation of BAGL
●
47bps increase in the Group’s Common Equity Tier 1 (CET1)
ratio as a result of the sale and reflecting the proportional
consolidation of BAGL for regulatory reporting purposes. Estimate a
further c.26bps Group CET1 ratio accretion through to regulatory
deconsolidation, which is expected, subject to regulatory approval,
within the next 18 months
●
H117 included an impairment of Barclays’ holding in BAGL of
£1.1bn and a loss on the sale of 33.7% of BAGL’s issued
share capital of £1.4bn, primarily due to recycling of
currency translation reserve losses to the income
statement
|
●
Common Equity Tier 1 (CET1) ratio:
|
●
CET1 ratio increased to 13.1% (December 2016: 12.4%) reflecting
strong organic capital generation and the benefit of the sale of
BAGL, partially offset by charges for PPI, pension contributions
and the redemption of USD preference shares
|
●
Holding Company (HoldCo) transition:
|
●
Continued to transition to HoldCo funding with £7.6bn
equivalent of issuance
●
H117 included the redemption of $1.375bn 7.1% Series 3 USD
preference shares
|
Improved Group profit before tax driven by reduced Non-Core
drag
●
|
Group profit before tax increased 13% to
£2,341m
reflecting materially lower losses in Non-Core
of £647m (H116: £1,904m), while Core profit before tax
reduced 25% to £2,988m impacted by charges for PPI of
£700m (H116: £400m) and the non-recurrence of the
£615m gain on disposal of Barclays’ share of Visa Europe
Limited in H116
|
●
|
Barclays UK RoTE of 4.6% (H116: 13.6%)
and cost: income ratio of 72% (H116: 61%) reflected charges for PPI
of £700m (H116: £400m). Net interest margin (NIM)
improved 10bps to 3.69%, with net interest income increasing 2% to
£3,045m
|
●
|
Barclays International RoTE of 12.4% (H116:
14.3%)
reflected RoTE of 28.0% (H116: 50.9%)
in Consumer, Cards and Payments
and an improved RoTE of 9.7% (H116: 8.4%) in the Corporate and
Investment Bank (CIB)
|
●
|
Loss after tax in respect of discontinued
operation of £2,195m
included an impairment of
Barclays’ holding in BAGL of £1,090m and a loss on the
sale of 33.7% of BAGL’s issued share capital of £1,435m,
primarily due to recycling of currency translation reserve losses
to the income statement
|
●
|
Group basic loss per share of (6.6p) (H116:
earnings of 6.9p) with earnings per share in respect of continuing
operations of 7.1p (H116: 6.0p)
. Excluding the loss on the
sale of 33.7% of BAGL’s issued share capital, the impairment
of Barclays’ holding in BAGL and charges for PPI of
£700m, earnings per share were 11.8p
|
●
|
Tangible net asset value per share decreased to
284p (December 2016: 290p)
as profit from continuing
operations was offset by decreases across reserves
|
Barclays Group
results
|
|
for the half year ended
|
30.06.17
|
30.06.16
|
YoY
|
|
£m
|
£m
|
% Change
|
Total income
|
10,881
|
11,013
|
(1)
|
Credit impairment charges and other provisions
|
(1,054)
|
(931)
|
(13)
|
Net operating
income
|
9,827
|
10,082
|
(3)
|
Operating expenses excluding litigation and conduct
|
(6,989)
|
(7,172)
|
3
|
Litigation and conduct
|
(743)
|
(525)
|
(42)
|
Operating expenses
|
(7,732)
|
(7,697)
|
-
|
Other net income/(expenses)
|
246
|
(322)
|
|
Profit before tax
|
2,341
|
2,063
|
13
|
Tax charge
|
(778)
|
(715)
|
(9)
|
Profit after tax in respect of continuing operations
|
1,563
|
1,348
|
16
|
(Loss)/profit after tax in respect of discontinued
operation
1
|
(2,195)
|
311
|
|
Non-controlling interests in respect of continuing
operations
|
(138)
|
(186)
|
26
|
Non-controlling interests in respect of discontinued
operation
1
|
(140)
|
(155)
|
10
|
Other equity holders
2
|
(301)
|
(208)
|
(45)
|
Attributable (loss)/profit
|
(1,211)
|
1,110
|
|
|
|
|
|
Performance measures
|
|
|
|
Return on average tangible shareholders' equity
2
|
(4.6%)
|
4.8%
|
|
Average tangible shareholders' equity (£bn)
|
49
|
48
|
|
Cost: income ratio
|
71%
|
70%
|
|
Loan loss rate (bps)
|
49
|
39
|
|
|
|
|
|
Basic (loss)/earnings per share
2
|
(6.6p)
|
6.9p
|
|
Basic earnings per share in respect of continuing
operations
2
|
7.1p
|
6.0p
|
|
Dividend per share
|
1.0p
|
1.0p
|
|
|
|
|
|
|
As at
|
As at
|
|
Balance sheet and capital management
|
30.06.17
|
31.12.16
|
|
Tangible net asset value per share
|
284p
|
290p
|
|
Common equity tier 1 ratio
|
13.1%
|
12.4%
|
|
Common equity tier 1 capital
|
£42.8bn
|
£45.2bn
|
|
Risk weighted assets
|
£327bn
|
£366bn
|
|
UK leverage ratio (quarterly month end average)
3
|
4.8%
|
4.5%
|
|
Fully loaded tier 1 capital (quarterly month end
average)
3
|
£52.1bn
|
£51.6bn
|
|
UK leverage exposure (quarterly month end
average)
3
|
£1,092bn
|
£1,137bn
|
|
|
|
|
|
Funding and liquidity
|
|
|
|
Group liquidity pool
|
£201bn
|
£165bn
|
|
CRD IV liquidity coverage ratio
|
149%
|
131%
|
|
Loan: deposit ratio
4
|
81%
|
83%
|
|
1
|
Refer to pages 36-37 for further information relating to the Africa
Banking discontinued operation. Loss after tax in respect of
discontinued operation includes impairment of Barclays’
holding in BAGL of £1,090m and the loss on the sale of 33.7%
of BAGL’s issued share capital of £1,435m in
H117.
|
2
|
The profit after tax attributable to other equity holders of
£301m (H116: £208m) is offset by a tax credit recorded in
reserves of £82m (H116: £58m). The net amount of
£219m (H116: £150m), along with non-controlling interests
(NCI) is deducted from profit after tax in order to calculate
earnings per share and return on average tangible
shareholders’ equity.
|
3
|
The UK leverage ratio uses capital and exposure measures based on
the average of the last day of each month in the quarter;
additionally, the average exposure measure excludes qualifying
central bank claims.
|
4
|
Loan: deposit ratio for Barclays UK, Barclays International and
Non-Core, excluding investment banking businesses.
|
Barclays Core and Non-Core
results
|
Barclays Core
|
|
Barclays Non-Core
|
for the half year ended
|
30.06.17
|
30.06.16
|
YoY
|
|
30.06.17
|
30.06.16
|
YoY
|
|
£m
|
£m
|
% Change
|
|
£m
|
£m
|
% Change
|
Total income
|
11,411
|
11,599
|
(2)
|
|
(530)
|
(586)
|
10
|
Credit impairment charges and other provisions
|
(1,024)
|
(876)
|
(17)
|
|
(30)
|
(55)
|
45
|
Net operating income/(expenses)
|
10,387
|
10,723
|
(3)
|
|
(560)
|
(641)
|
13
|
Operating expenses excluding litigation and conduct
|
(6,733)
|
(6,315)
|
(7)
|
|
(256)
|
(857)
|
70
|
Litigation and conduct
|
(715)
|
(432)
|
(66)
|
|
(28)
|
(93)
|
70
|
Operating expenses
|
(7,448)
|
(6,747)
|
(10)
|
|
(284)
|
(950)
|
70
|
Other net income/(expenses)
|
49
|
(9)
|
|
|
197
|
(313)
|
|
Profit/(loss) before tax
|
2,988
|
3,967
|
(25)
|
|
(647)
|
(1,904)
|
66
|
Tax (charge)/credit
|
(1,060)
|
(1,181)
|
10
|
|
282
|
466
|
(39)
|
Profit/(loss) after tax
|
1,928
|
2,786
|
(31)
|
|
(365)
|
(1,438)
|
75
|
Non-controlling interests
|
(121)
|
(164)
|
26
|
|
(17)
|
(22)
|
23
|
Other equity holders
|
(264)
|
(178)
|
(48)
|
|
(37)
|
(30)
|
(23)
|
Attributable profit/(loss)
1
|
1,543
|
2,444
|
(37)
|
|
(419)
|
(1,490)
|
72
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
7.3%
|
12.5%
|
|
|
|
|
|
Average allocated tangible equity (£bn)
1
|
45
|
40
|
|
|
5
|
8
|
|
Period end allocated tangible equity (£bn)
1
|
44
|
41
|
|
|
4
|
8
|
|
Cost: income ratio
|
65%
|
58%
|
|
|
n/m
|
n/m
|
|
Loan loss rate (bps)
|
54
|
43
|
|
|
12
|
15
|
|
Basic earnings/(loss) per share contribution
|
9.5p
|
14.8p
|
|
|
(2.4p)
|
(8.8p)
|
|
|
|
|
|
|
|
|
|
|
As at
|
As at
|
|
|
As at
|
As at
|
|
Capital management
|
30.06.17
|
31.12.16
|
|
|
30.06.17
|
31.12.16
|
|
Risk weighted assets
1
|
£304.6bn
|
£333.5bn
|
|
|
£22.8bn
|
£32.1bn
|
|
UK leverage exposure (quarterly month end
average)
1
|
£997bn
|
£1,026bn
|
|
|
£95bn
|
£111bn
|
|
1
|
Attributable profit in respect of the Africa Banking discontinued
operation is reported at the Group level only. Allocated tangible
equity, RWAs and leverage exposure are reported in Head Office
within Core.
|
|
Half year ended
|
Half year ended
|
|
|
30.06.17
|
30.06.16
|
YoY
|
Income by business
|
£m
|
£m
|
% Change
|
Barclays UK
|
3,661
|
3,746
|
(2)
|
Barclays International
|
7,748
|
7,552
|
3
|
Head Office
|
2
|
301
|
(99)
|
Barclays Core
|
11,411
|
11,599
|
(2)
|
Barclays Non-Core
|
(530)
|
(586)
|
10
|
Barclays Group
|
10,881
|
11,013
|
(1)
|
Profit/(loss) before tax by business
|
|
|
|
Barclays UK
|
634
|
1,080
|
(41)
|
Barclays International
|
2,617
|
2,753
|
(5)
|
Head Office
|
(263)
|
134
|
|
Barclays Core
|
2,988
|
3,967
|
(25)
|
Barclays Non-Core
|
(647)
|
(1,904)
|
66
|
Barclays Group
|
2,341
|
2,063
|
13
|
Group Chief Executive Officer’s Review
“The second quarter saw us complete two critically
important planks of our strategy; both of them ahead of
schedule.
First, we reduced our majority shareholding in Barclays Africa
Group Limited to a level which allows us to apply for regulatory
deconsolidation, and we expect to achieve that in 2018. We have
permission to apply proportional consolidation to our reduced
shareholding, which means that our CET1 ratio stands at 13.1%
today, within our end-state target range. We will realise a further
c.26bps uplift resulting from the sale.
Second, we completed the accelerated rundown of our Non-Core unit
to below our target of £25bn in Risk Weighted Assets, allowing
us to close it 6 months early and incorporate the residual assets
back into the Core.
Accomplishing both of these milestones marks an end to the
restructuring of the Barclays Group, and brings forward the date
when our shareholders can benefit from the full earnings power of
this business.
That power is evident once again in the performance reported today.
At the half year, Group profit before tax increased 13% to
£2,341m. Our strong businesses, Barclays UK and Barclays
International, posted attractive Returns on Tangible Equity of
20.4% - excluding the provision for PPI - and 12.4%
respectively.
Our business is now radically simplified, the restructuring is
complete, our capital ratio is within our end-state target range,
and while we are also working to put conduct issues behind us, we
can now focus on what matters most to our shareholders: improving
Group returns.
We have accordingly established a new target today which is to
achieve a greater than 10% Group Return on Tangible Equity over
time.
Finally we will, at the full year results early next year, provide
investors with an updated capital management policy for the
Group.”
James E Staley, Group Chief Executive Officer
Group Finance Director’s Review
Results
for the first half of the year demonstrated significant progress
against the Group’s strategy, evidenced by solid underlying
Core performance, materially lower losses in Non-Core, the sell
down to a target stake in BAGL and further progress on capital. The
Core business reported a double digit RoTE of 10.4%, excluding the
impact of charges for PPI, on a materially increased average
tangible equity base. The closure of Non-Core on 1 July 2017
represented a significant milestone in the restructuring of the
bank, with RWAs of £23bn, less than the previous guidance of
c.£25bn, and the sale of a 33.7% stake in BAGL resulted in the
accounting deconsolidation of the entity. Group H117 results were
impacted by a loss on the sale of, and an impairment of
Barclays’ holding in, BAGL. The Group’s CET1 ratio
benefitted by 47bps from the sale and reflecting the proportional
consolidation of BAGL, which, along with underlying organic capital
generation, contributed to the capital ratio increasing to 13.1%,
within the end-state target range.
Group performance
●
|
Profit
before tax increased 13% to £2,341m, driven by materially
reduced losses from the Non-Core which reported a loss before tax
of £647m (H116: £1,904m). Core profits decreased 25% to
£2,988m, impacted by charges for PPI of £700m (H116:
£400m) and the non-recurrence of a £615m gain on disposal
of Barclays’ share of Visa Europe Limited in H116. H117
results were also impacted by the appreciation of average USD and
EUR against GBP of 12% and 10% respectively, compared to H116,
which positively impacted income and adversely affected impairment
and operating expenses
|
●
|
Total
income decreased 1% to £10,881m, reflecting a 2% reduction in
income in the Core to £11,411m, predominantly in Head Office,
partially offset by a 10% reduction in Non-Core negative income to
£530m. Income increased 3% in Barclays International, with
growth across both CIB and Consumer, Cards and Payments, though
decreased 2% in Barclays UK, impacted by the non-recurrence of a
gain on disposal of Barclays’ share of Visa Europe Limited in
H116
|
●
|
Credit
impairment charges increased £123m to £1,054m, driven by
a 53% increase in Consumer, Cards and Payments, mainly reflecting a
change in portfolio mix, an increase in underlying delinquency
trends in US Cards and business growth, partially offset by lower
impairment in CIB. As a result, the Group loan loss rate increased
10bps to 49bps
|
●
|
Operating
expenses were broadly in line at £7,732m (H116: £7,697m),
driven by a 10% increase in Core to £7,448m due to charges for
PPI, the impact of the change in compensation awards introduced in
Q416 and business growth and investment, which more than offset
cost efficiencies. Non-Core operating expenses reduced 70% to
£284m as the segment continued to be rundown
|
●
|
Other
net income increased to £246m (H116: £322m expense)
reflecting a gain of £109m on the sale of Barclays’
share in VocaLink to MasterCard and a gain of £76m on the sale
of a joint venture in Japan. A gain of £189m on the sale of
Barclays Bank Egypt was broadly offset by the recycling of
£180m of currency translation reserve losses to the income
statement
|
●
|
Loss
after tax in respect of the Africa Banking discontinued operation
of £2,195m (H116: profit of £311m) included a
£1,090m impairment of Barclays’ holding in BAGL and a
£1,435m loss on the sale of 33.7% of BAGL’s issued share
capital, primarily due to recycling of currency translation reserve
losses to the income statement on accounting
deconsolidation
|
●
|
RoTE
was (4.6%) (H116: 4.8%) and basic loss per share was (6.6p) (H116:
earnings of 6.9p). Excluding the impact of the loss on the sale of
33.7% of BAGL’s issued share capital, the impairment of
Barclays’ holding in BAGL and charges for PPI RoTE, was 8.1%
and earnings per share were 11.8p
|
Core performance
●
|
The
Core business generated an RoTE of 7.3% (H116: 12.5%), though
excluding charges for PPI delivered a double digit RoTE of
10.4%
|
●
|
Profit
before tax decreased 25% to £2,988m mainly due to the impact
of charges for PPI of £700m (H116: £400m) and the
non-recurrence of the gain on disposal of Barclays’ share of
Visa Europe Limited of £615m in H116
|
●
|
Total
income decreased 2% to £11,411m driven by reduced income in
Head Office, primarily due to the non-recurrence of own credit
gains in H116, and in Barclays UK, mainly due to the non-recurrence
of the gain on disposal of Barclays’ share of Visa Europe
Limited. This was partially offset by 3% growth in Barclays
International, with growth across both CIB and Consumer, Cards and
Payments
|
●
|
Credit
impairment charges increased 17% to £1,024m, driven by
increased impairment in Consumer, Cards and Payments mainly
reflecting a change in portfolio mix, an increase in underlying
delinquency trends in US Cards and business growth. The Core loan
loss rate increased 11bps to 54bps
|
●
|
Operating
expenses increased 10% to £7,448m driven by charges for PPI,
the change in compensation awards introduced in Q416, higher
structural reform programme costs and business growth and
investment in Consumer, Cards and Payments
|
●
|
Other
net income of £49m (H116: £9m expense) reflected a gain
of £109m on the sale of Barclays’ share in VocaLink to
MasterCard and a gain of £76m on the sale of a joint venture
in Japan, offset by an expense of £180m on the recycling of
the currency translation reserve to the income statement on the
sale of Barclays Bank Egypt
|
Barclays UK
●
|
RoTE
reduced to 4.6% (H116: 13.6%) with a 41% decrease in profit before
tax to £634m due to charges for PPI of £700m (H116:
£400m) and the non-recurrence of the £151m gain on
disposal of Barclays’ share of Visa Europe Limited in
H116
|
●
|
Total
income decreased 2% to £3,661m driven by the non-recurrence of
the £151m gain on disposal of Barclays’ share of Visa
Europe Limited in H116 and the impact of the UK base rate reduction
in 2016, partially offset by pricing initiatives and deposit
growth. The net interest margin increased 10bps to
3.69%
|
●
|
Credit
impairment charges increased £32m year-on-year to £398m,
reflecting higher charge-offs in Personal Banking and the higher
recoveries in H116. Underlying delinquency trends reduced
year-on-year, with 30 and 90 day arrears rates in UK Cards
improving year-on-year to 2.0% (H116: 2.3%) and 0.9% (H116: 1.2%)
respectively
|
●
|
Operating
expenses increased 14% to £2,628m, due to charges for PPI of
£700m (H116: £400m), the costs of setting up the
ring-fenced bank and investment in cyber resilience and technology,
partially offset by cost efficiencies
|
Barclays International
●
|
RoTE of
12.4% (H116: 14.3%) reflected an improved RoTE of 9.7% in CIB
(H116: 8.4%) and an RoTE of 28.0% (H116: 50.9%) in Consumer, Cards
and Payments
|
●
|
Profit
before tax decreased 5% to £2,617m driven by an increase in
operating expenses and impairment, partially offset by higher
income
|
●
|
Total
income increased 3% to £7,748m, including the appreciation of
average USD and EUR against GBP, with growth in both CIB and
Consumer, Cards and Payments. CIB income increased 3% to
£5,346m driven by higher Banking income, partially offset by a
decrease in Macro income, while Consumer, Cards and Payments income
increased 2% to £2,402m including growth in US
Cards
|
●
|
Credit
impairment charges increased 23% to £625m driven by Consumer,
Cards and Payments, which increased 53% to £575m, due to a
change in portfolio mix, an increase in underlying delinquency
trends in US Cards, business growth and the appreciation of average
USD and EUR against GBP. CIB credit impairment charges reduced 62%
to £50m due to the non-recurrence of oil and gas single name
charges in H116
|
●
|
Total
operating expenses increased 10% to £4,720m, including the
appreciation of average USD and EUR against GBP. CIB operating
expenses increased 7% to £3,697m reflecting the change in
compensation awards introduced in Q416 and higher structural reform
programme costs, partially offset by a reduction in restructuring
charges and cost efficiencies. Consumer, Cards and Payments
operating expenses increased 21% to £1,023m including
continued growth and investment
|
●
|
Other
net income increased to £214m (H116: £19m) reflecting a
gain of £109m on the sale of Barclays’ share in VocaLink
to MasterCard and a gain of £76m on the sale of a joint
venture in Japan
|
Head Office
●
|
Income
reduced £299m to £2m, primarily due to the early adoption
of the own credit provisions of IFRS 9 and lower net income from
treasury operations. Own credit, which was previously recorded in
the income statement (H116: gain of £183m) is now recognised
within other comprehensive income
|
●
|
Loss
before tax of £263m (H116: profit of £134m) included an
expense of £180m on the recycling of the currency translation
reserve to the income statement on the sale of Barclays Bank
Egypt
|
Non-Core performance
●
|
Non-Core
to close on 1 July 2017, with residual assets and liabilities to be
reintegrated into the Core and, as previously guided to, it is
expected that risk weighted assets and loss before tax previously
associated with Non-Core will continue to reduce in future
periods
|
●
|
Progress
on the rundown continued with RWAs reduced to £22.8bn
(December 2016: £32.1bn), below guidance of approximately
£25bn, driven by a £5bn reduction in Derivatives, a
£2bn reduction in Businesses and a £1bn reduction in
Securities and loans
|
●
|
Loss
before tax decreased to £647m (H116: £1,904m) driven by
lower operating expenses, favourable fair value movements on the
Education, Social Housing and Local Authority (ESHLA) portfolio,
the non-recurrence of impairment associated with the valuation of
the French retail business in H116 and a £189m gain on the
sale of Barclays Bank Egypt
|
●
|
Total
income increased £56m to a net expense of £530m driven by
increased Securities and loans income primarily due to positive
fair value movements on the ESHLA portfolio. This was offset by
reduced Derivatives income, reflecting increased cost of exits, and
lower Businesses income following the completion of the sale of the
Italian retail, Southern European cards and Barclays Bank Egypt
businesses
|
●
|
Operating
expenses improved 70% to £284m reflecting the completion of
the sale of several businesses, a reduction in restructuring
charges, and lower litigation and conduct charges
|
●
|
Other
net income increased to £197m (H116: £313m expense)
reflecting a £189m gain on sale of Barclays Bank Egypt and the
non-recurrence of impairment associated with the valuation of the
French retail business in H116
|
Group capital and leverage
●
|
The
fully loaded CET1 ratio increased to 13.1% (December 2016: 12.4%)
principally due to a reduction in RWAs of £38.2bn to
£327.4bn. CET1 capital decreased £2.4bn to
£42.8bn
|
|
–
|
Profits
relating to continuing operations were largely offset by decreases
in other qualifying reserves as a result of the redemption of USD
preference shares, the separation payments relating to the BAGL
disposal and increased pension deductions. CET1 capital further
decreased by £1.8bn as a result of BAGL minority interest no
longer being included under proportional consolidation
|
|
–
|
Losses
relating to the discontinued operation due to the impairment
allocated to the goodwill of Barclays’ holding in BAGL and
the recycling of the BAGL currency translation reserve losses to
the income statement had no impact on CET1 capital
|
|
–
|
The
decrease in RWAs principally reflected the £27.9bn reduction
as a result of the proportional consolidation of BAGL following the
selldown of Barclays’ holding, as well as reductions in
Non-Core
|
●
|
The
average UK leverage ratio increased to 4.8% (December 2016: 4.5%)
driven by an increase in the average fully loaded Tier 1 capital to
£52.1bn (December 2016: £51.6bn) and a decrease in the
average UK leverage exposure to £1,092bn (December 2016:
£1,137bn)
|
●
|
Tangible
net asset value per share decreased to 284p (December 2016: 290p)
primarily due to profit after tax excluding additional charges for
PPI being more than offset by the redemption of USD preference
shares, dividends paid and reduction in reserves including the
currency translation and cash flow hedge reserves
|
Group funding and liquidity
●
|
The
Group continued to maintain surpluses to its internal and
regulatory requirements. The liquidity pool increased to
£201bn (December 2016: £165bn). The increase in the
liquidity pool was driven by a net increase in minimum requirement
for own funds and eligible liabilities (MREL) issuance, drawdown
from the Bank of England Term Funding Scheme, higher money market
balances and deposit growth. The liquidity coverage ratio
(LCR) increased to
149% (December
2016: 131%), equivalent to a surplus of £65bn (December 2016:
£39bn) to 100%, reflecting our approach to build a
conservative liquidity position
|
●
|
Wholesale funding outstanding excluding repurchase agreements was
£163bn (December 2016: £158bn). The Group issued
£7.6bn equivalent of capital and term senior unsecured debt
from Barclays PLC (HoldCo) of which £4.8bn was in public
senior unsecured debt, and £2.8bn in capital instruments. In
the same period, £4.7bn of Barclays Bank PLC (OpCo) capital
and senior public term instruments either matured or were redeemed,
including the $1.375bn 7.1% Series 3 USD preference
shares
|
Other matters
●
|
On 1
June 2017, Barclays sold 286 million ordinary shares of BAGL,
representing 33.7% of BAGL’s issued share capital. The sale
resulted in the accounting deconsolidation of BAGL from the
Barclays Group. Following the sale, BAGL is accounted for as an
Available for Sale (AFS) asset in Barclays’ financial
statements and is no longer reported as a discontinued operation.
The Group’s CET1 ratio increased 47bps as a result of the
sale and reflecting the proportional consolidation of BAGL for
regulatory reporting purposes
|
●
|
As at
30 June 2017, Barclays accounted for 139 million ordinary shares in
BAGL, representing 16.4% of BAGL’s issued share capital.
Barclays had an obligation at this date to contribute 1.5% of
BAGL’s ordinary shares or the cash equivalent to a Black
Economic Empowerment scheme. At 30 September 2017, Barclays will
account for 126 million ordinary shares in BAGL, currently
representing 14.9% of BAGL’s issued share
capital
|
●
|
The
latest triennial valuation of the UK Retirement Fund (UKRF) with an
effective date of 30 September 2016 has been completed and showed a
funding deficit of £7.9bn and funding level of 81.5%, versus a
£6.0bn funding deficit at the 30 September 2015 update.
Amongst other measures, Barclays and the UKRF agreed a recovery
plan with revised deficit reduction contributions of £740m in
2017 (of which £620m has been paid in H117), £500m per
annum in 2018 to 2020, and £1,000m per annum in 2021 to
2026
|
●
|
Additional
charges of £700m (H116: £400m) relating to PPI were
recognised in Q217, primarily to reflect higher than expected
complaints flow in the year to date. The remaining PPI provision as
at June 2017 was £2,109m (December 2016:
£1,979m)
|
●
|
Certain
legal proceedings and investigations relating to legacy issues
remain outstanding. Resolving outstanding legacy issues in an
appropriate timeframe will continue to be a priority. Please see
Note 19 to the financial statements for details of relevant
matters
|
Dividends
●
|
An
interim dividend of 1.0p per share will be paid on 18 September
2017
|
Outlook and financial targets
●
|
The
Group remains focused on cost efficiency, creating capacity to
self-fund investment in our businesses, and continues to target a
Group cost: income ratio of less than 60% over time
|
●
|
Following
the closure of the Non-Core segment on 1 July 2017, the
Group’s previous returns target of converging Group returns
with Core returns is transitioned to a target of achieving a Group
RoTE of greater than 10.0% over time, underpinned by a combination
of cost focus and redeployment of capital from business lines
delivering inadequate returns
|
●
|
The
Group expects the dividend for the full year to total 3.0p per
share as previously guided. The Group will update the market on its
updated capital management framework including the dividend policy
at the full year results in February 2018
|
Tushar Morzaria, Group Finance Director
Results by Business
Barclays UK
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
YoY
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
3,045
|
2,977
|
2
|
Net fee, commission and other income
|
616
|
769
|
(20)
|
Total income
|
3,661
|
3,746
|
(2)
|
Credit impairment charges and other provisions
|
(398)
|
(366)
|
(9)
|
Net operating income
|
3,263
|
3,380
|
(3)
|
Operating expenses excluding litigation and conduct
|
(1,933)
|
(1,899)
|
(2)
|
Litigation and conduct
|
(695)
|
(400)
|
(74)
|
Operating expenses
|
(2,628)
|
(2,299)
|
(14)
|
Other net expenses
|
(1)
|
(1)
|
-
|
Profit before tax
|
634
|
1,080
|
(41)
|
Attributable profit
|
185
|
608
|
(70)
|
|
|
|
|
|
As at 30.06.17
|
As at 31.12.16
|
As at 30.06.16
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances to customers at amortised cost
|
166.6
|
166.4
|
166.0
|
Total assets
|
203.4
|
209.6
|
204.6
|
Customer deposits
|
187.4
|
189.0
|
181.7
|
Risk weighted assets
|
66.1
|
67.5
|
67.1
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Key facts
|
30.06.17
|
30.06.16
|
|
Average LTV of mortgage portfolio
1
|
47%
|
47%
|
|
Average LTV of new mortgage lending
1
|
62%
|
63%
|
|
Number of branches
|
1,295
|
1,331
|
|
Barclays mobile banking active customers
|
5.9m
|
5.1m
|
|
30 day arrears rate - Barclaycard Consumer UK
|
2.0%
|
2.3%
|
|
|
|
|
|
Performance measures
|
|
|
|
Return on average allocated tangible equity
|
4.6%
|
13.6%
|
|
Average allocated tangible equity (£bn)
|
8.8
|
9.1
|
|
Cost: income ratio
|
72%
|
61%
|
|
Loan loss rate (bps)
|
47
|
43
|
|
Loan: deposit ratio
|
89%
|
91%
|
|
Net interest margin
|
3.69%
|
3.59%
|
|
1
|
Average LTV of mortgage portfolio and new mortgage lending
calculated on the balance weighted basis.
|
Analysis of Barclays UK
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
YoY
|
Analysis of total income
|
£m
|
£m
|
% Change
|
Personal Banking
|
1,877
|
1,987
|
(6)
|
Barclaycard Consumer UK
|
993
|
954
|
4
|
Wealth, Entrepreneurs & Business Banking
|
791
|
805
|
(2)
|
Total income
|
3,661
|
3,746
|
(2)
|
|
|
|
|
Analysis of credit impairment charges and other
provisions
|
|
|
|
Personal Banking
|
(106)
|
(86)
|
(23)
|
Barclaycard Consumer UK
|
(272)
|
(274)
|
1
|
Wealth, Entrepreneurs & Business Banking
|
(20)
|
(6)
|
|
Total credit impairment charges and other provisions
|
(398)
|
(366)
|
(9)
|
|
|
|
|
|
As at 30.06.17
|
As at 31.12.16
|
As at 30.06.16
|
Analysis of loans and advances to customers at amortised
cost
|
£bn
|
£bn
|
£bn
|
Personal Banking
|
136.5
|
135.0
|
134.7
|
Barclaycard Consumer UK
|
16.2
|
16.5
|
16.2
|
Wealth, Entrepreneurs & Business Banking
|
13.9
|
14.9
|
15.1
|
Total loans and advances to customers at amortised
cost
|
166.6
|
166.4
|
166.0
|
|
|
|
|
Analysis of customer deposits
|
|
|
|
Personal Banking
|
138.5
|
139.3
|
134.8
|
Barclaycard Consumer UK
|
-
|
-
|
-
|
Wealth, Entrepreneurs & Business Banking
|
48.9
|
49.7
|
46.9
|
Total customer deposits
|
187.4
|
189.0
|
181.7
|
Barclays UK
Income statement – H117 compared to H116
●
|
Profit
before tax decreased 41% to £634m primarily due to charges for
PPI of £700m (H116: £400m) and the non-recurrence of the
£151m gain on disposal of Barclays’ share in Visa Europe
Limited in H116
|
●
|
Total
income decreased 2% to £3,661m due to the non-recurrence of
the £151m gain on disposal of Barclays’ share of Visa
Europe Limited in H116 and the impact of the UK base rate reduction
in 2016, partially offset by pricing initiatives and deposit
growth
|
|
–
|
Personal
Banking income decreased 6% to £1,877m driven by the
non-recurrence of the gain on disposal of Barclays’ share of
Visa Europe Limited in H116, the impact of the UK base rate
reduction in 2016 and asset margin pressure, partially offset by
pricing initiatives and deposit growth
|
|
–
|
Barclaycard
Consumer UK income increased 4% to £993m reflecting improved
margins
|
|
–
|
Wealth,
Entrepreneurs & Business Banking (WEBB) decreased 2% to
£791m due to the non-recurrence of the gain on disposal of
Barclays’ share of Visa Europe Limited in H116, partially
offset by deposit pricing initiatives and balance
growth
|
|
–
|
Net
interest income increased 2% to £3,045m due to deposit pricing
initiatives and balance growth
|
|
–
|
Net
interest margin increased 10bps to 3.69% reflecting higher margins
on Personal Banking deposits, partially offset by lower asset
margins
|
|
–
|
Net
fee, commission and other income decreased 20% to £616m due to
the non-recurrence of the gain on disposal of Barclays’ share
of Visa Europe Limited in H116
|
●
|
Credit
impairment charges increased £32m to £398m reflecting
higher charge-offs in Personal Banking and higher recoveries in
H116. Underlying delinquency trends reduced year-on-year, with 30
day and 90 day arrears rates in UK cards improving year-on-year at
2.0% (H116: 2.3%) and 0.9% (H116: 1.2%) respectively
|
●
|
Total
operating expenses increased 14% to £2,628m due to charges for
PPI of £700m (H116: £400m), the costs of setting up the
ring-fenced bank and investment in cyber resilience and technology,
partially offset by cost efficiencies
|
Balance sheet – 30 June 2017 compared to 31 December
2016
●
|
Loans
and advances to customers were broadly in line at £166.6bn
(December 2016: £166.4bn)
|
●
|
Total
assets decreased 3% to £203.4bn primarily due to a reduction
in the allocated liquidity pool
|
●
|
Customer
deposits decreased 1% to £187.4bn reflecting the realignment
of certain clients between Barclays UK and Barclays International
in preparation for structural reform, partially offset by
underlying deposit growth
|
●
|
RWAs
reduced to £66.1bn (December 2016: £67.5bn) reflecting
the realignment of certain clients between Barclays UK and Barclays
International in preparation for structural reform
|
Barclays International
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
YoY
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
2,172
|
2,111
|
3
|
Net trading income
|
2,221
|
2,375
|
(6)
|
Net fee, commission and other income
|
3,355
|
3,066
|
9
|
Total income
|
7,748
|
7,552
|
3
|
Credit impairment charges and other provisions
|
(625)
|
(509)
|
(23)
|
Net operating income
|
7,123
|
7,043
|
1
|
Operating expenses excluding litigation and conduct
|
(4,711)
|
(4,295)
|
(10)
|
Litigation and conduct
|
(9)
|
(14)
|
36
|
Operating expenses
|
(4,720)
|
(4,309)
|
(10)
|
Other net income
|
214
|
19
|
|
Profit before tax
|
2,617
|
2,753
|
(5)
|
Attributable profit
|
1,656
|
1,746
|
(5)
|
|
|
|
|
|
As at 30.06.17
|
As at 31.12.16
|
As at 30.06.16
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances to banks and customers at amortised
cost
1
|
204.8
|
211.3
|
230.6
|
Trading portfolio assets
|
83.3
|
73.2
|
68.1
|
Derivative financial instrument assets
|
108.4
|
156.2
|
181.4
|
Derivative financial instrument liabilities
|
116.8
|
160.6
|
187.5
|
Reverse repurchase agreements and other similar secured
lending
|
17.2
|
13.4
|
19.7
|
Financial assets designated at fair value
|
94.1
|
62.3
|
68.3
|
Total assets
|
681.6
|
648.5
|
679.9
|
Customer deposits
2
|
230.3
|
216.2
|
226.5
|
Risk weighted assets
|
212.2
|
212.7
|
209.3
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Performance measures
|
30.06.17
|
30.06.16
|
|
Return on average allocated tangible equity
|
12.4%
|
14.3%
|
|
Average allocated tangible equity (£bn)
|
27.5
|
25.0
|
|
Cost: income ratio
|
61%
|
57%
|
|
Loan loss rate (bps)
|
61
|
44
|
|
Loan: deposit ratio
|
80%
|
90%
|
|
Net interest margin
|
4.06%
|
3.90%
|
|
1
|
As at 30 June 2017 loans and advances included £183.9bn
(December 2016: £185.9bn) of loans and advances to customers
(including settlement balances of £31.6bn (December 2016:
£19.5bn) and cash collateral of £26.9bn (December 2016:
£30.1bn)), and £20.9bn (December 2016: £25.4bn) of
loans and advances to banks (including settlement balances of
£5.7bn (December 2016: £1.7bn) and cash collateral of
£5.4bn (December 2016: £6.3bn)). Loans and advances
to banks and customers in respect of Consumer, Cards and Payments
were £38.5bn (December 2016: £39.7bn).
|
2
|
As at 30 June 2017 customer deposits included settlement balances
of £29.4bn (December 2016: £16.6bn) and cash collateral
of £16.2bn (December 2016: £20.8bn).
|
Analysis of Barclays International
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Corporate and Investment Bank
|
30.06.17
|
30.06.16
|
YoY
|
Income statement information
|
£m
|
£m
|
% Change
|
Analysis of total income
|
|
|
|
Credit
|
695
|
591
|
18
|
Equities
|
917
|
919
|
-
|
Macro
|
946
|
1,185
|
(20)
|
Markets
|
2,558
|
2,695
|
(5)
|
Banking fees
|
1,400
|
1,103
|
27
|
Corporate lending
|
547
|
608
|
(10)
|
Transactional banking
|
802
|
798
|
1
|
Banking
|
2,749
|
2,509
|
10
|
Other
|
39
|
3
|
|
Total income
|
5,346
|
5,207
|
3
|
Credit impairment charges and other provisions
|
(50)
|
(132)
|
62
|
Operating expenses
|
(3,697)
|
(3,465)
|
(7)
|
Other net income
|
116
|
-
|
|
Profit before tax
|
1,715
|
1,610
|
7
|
|
|
|
|
|
As at 30.06.17
|
As at 31.12.16
|
As at 30.06.16
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Risk weighted assets
|
178.9
|
178.6
|
178.4
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Performance measures
|
30.06.17
|
30.06.16
|
|
Return on average allocated tangible equity
|
9.7%
|
8.4%
|
|
Average allocated tangible equity (£bn)
|
23.3
|
21.5
|
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Consumer, Cards and Payments
|
30.06.17
|
30.06.16
|
YoY
|
Income statement information
|
£m
|
£m
|
% Change
|
Total income
|
2,402
|
2,345
|
2
|
Credit impairment charges and other provisions
|
(575)
|
(377)
|
(53)
|
Operating expenses
|
(1,023)
|
(844)
|
(21)
|
Other net income
|
98
|
19
|
|
Profit before tax
|
902
|
1,143
|
(21)
|
|
|
|
|
|
As at 30.06.17
|
As at 31.12.16
|
As at 30.06.16
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances to banks and customers at amortised
cost
|
38.5
|
39.7
|
35.4
|
Customer deposits
|
57.3
|
50.0
|
46.9
|
Risk weighted assets
|
33.3
|
34.1
|
30.9
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Key facts
|
30.06.17
|
30.06.16
|
|
30 day arrears rates – Barclaycard US
|
2.2%
|
2.2%
|
|
Total number of Barclaycard business clients
|
364,000
|
350,000
|
|
Value of payments processed
|
£157bn
|
£141bn
|
|
|
|
|
|
Performance measures
|
|
|
|
Return on average allocated tangible equity
|
28.0%
|
50.9%
|
|
Average allocated tangible equity (£bn)
|
4.2
|
3.5
|
|
Barclays International
Income statement – H117 compared to H116
●
|
Profit
before tax decreased 5% to £2,617m driven by a 10% increase in
total operating expenses and a 23% increase in impairment,
partially offset by a 3% increase in total income
|
●
|
Total
income increased 3% to £7,748m, including the appreciation of
average USD and EUR against GBP, as CIB income increased 3% to
£5,346m and Consumer, Cards and Payments income increased 2%
to £2,402m
|
–
|
Markets
income decreased 5% to £2,558m
|
|
–
|
Credit
income increased 18% to £695m driven by improved performance
in the European business and increased municipals
income
|
|
–
|
Equities
income was broadly in line at £917m (H116: £919m) driven
by lower US equity derivatives revenue, offset by improved
performance in cash equities and equity financing
|
|
–
|
Macro
income decreased 20% to £946m driven by lower market
volatility in rates and the impact of exiting energy-related
commodities
|
–
|
Banking
income increased 10% to £2,749m
|
|
–
|
Banking
fees income increased 27% to £1,400m, driven by higher debt
underwriting, equity underwriting and advisory fees, with fee share
up in all products
|
|
–
|
Corporate
lending reduced 10% to £547m primarily due to higher losses on
fair value hedges, a reduction in work-out gains and reduced
balances
|
|
–
|
Transactional
banking income increased 1% to £802m as higher deposit
balances were partially offset by margin compression in a low base
rate environment
|
–
|
Consumer,
Cards and Payments income increased 2% to £2,402m driven by
continued growth, a gain of £192m relating to an asset sale in
US cards and a valuation gain on Barclays’ preference shares
in Visa Inc. of £74m, partially offset by the non-recurrence
of the gain on the disposal of Barclays’ share of Visa Europe
Limited of £464m in H116
|
●
|
Credit
impairment charges increased 23% to £625m including the
appreciation of average USD and EUR against GBP
|
–
|
CIB
credit impairment charges reduced 62% to £50m due to the
non-recurrence of oil and gas single name charges in
H116
|
–
|
Consumer,
Cards and Payments credit impairment charges increased 53% to
£575m primarily driven by a change in portfolio mix, an
increase in underlying delinquency trends in US cards and business
growth. 30 and 90 days arrears rates within US Cards were broadly
stable at 2.2% (H116: 2.2%) and 1.1% (H116: 1.0%) respectively,
including a benefit from the Q117 asset sale in US
cards
|
●
|
Total
operating expenses increased 10% to £4,720m, including the
appreciation of average USD and EUR against GBP
|
–
|
CIB
increased 7% to £3,697m reflecting the change in compensation
awards introduced in Q416 and higher structural reform programme
costs, partially offset by a reduction in restructuring charges and
cost efficiencies
|
–
|
Consumer,
Cards and Payments increased 21% to £1,023m including
continued growth and investment, primarily within the US Cards and
merchant acquiring businesses
|
●
|
Other
net income increased to £214m (H116: £19m) due to a gain
of £109m on the sale of Barclays’ share in VocaLink to
MasterCard and a gain of £76m on the sale of a joint venture
in Japan
|
Balance sheet – 30 June 2017 compared to 31 December
2016
●
|
Loans
and advances to banks and customers at amortised cost decreased
£6.5bn to £204.8bn with CIB decreasing £5.3bn to
£166.3bn due to a reduction in lending and cash collateral,
partially offset by an increase in settlement balances. Consumer,
Cards and Payments decreased £1.2bn to £38.5bn due to an
asset sale in US cards in Q117, partially offset by the realignment
of certain clients from Barclays UK to Barclays International in
preparation for structural reform
|
●
|
Trading
portfolio assets increased £10.1bn to £83.3bn due to
increased activity
|
●
|
Derivative
financial instrument assets and liabilities decreased £47.8bn
to £108.4bn and £43.8bn to £116.8bn respectively,
reflecting the adoption of the Chicago Mercantile Exchange (CME)
rulebook change to daily settlement and an increase in major
interest rate forward curves and depreciation of USD against
GBP
|
●
|
Reverse
repurchase agreements and other similar lending increased
£3.8bn to £17.2bn primarily due to increased trading
desks’ funding requirements
|
●
|
Financial assets
designated at fair value increased £31.8bn to £94.1bn
primarily due to increased matched book trading and trading
desks’ funding requirements
|
●
|
Customer deposits
increased £14.1bn to £230.3bn, with CIB increasing
£6.8bn to £173.0bn primarily driven by an increase in
settlement balances, partially offset by a decrease in cash
collateral and corporate deposits. Consumer, Cards and Payments
increased £7.3bn to £57.3bn driven by the realignment of
certain clients from Barclays UK to Barclays International in
preparation for structural reform
|
●
|
RWAs
remained broadly in line at £212.2bn (December 2016:
£212.7bn) driven by a reduction due to the depreciation of USD
against GBP, an asset sale in US cards in Q117 and credit quality
improvement, offset by increased trading portfolio and securities
financing transaction volumes
|
Head Office
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
YoY
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
(7)
|
(6)
|
(17)
|
Net fee, commission and other income
|
9
|
307
|
(97)
|
Total income
|
2
|
301
|
(99)
|
Credit impairment charges and other provisions
|
(1)
|
(1)
|
-
|
Net operating income
|
1
|
300
|
|
Operating expenses excluding litigation and conduct
|
(89)
|
(121)
|
26
|
Litigation and conduct
|
(11)
|
(18)
|
39
|
Operating expenses
|
(100)
|
(139)
|
28
|
Other net expenses
|
(164)
|
(27)
|
|
(Loss)/profit before tax
|
(263)
|
134
|
|
Attributable (loss)/profit
|
(298)
|
90
|
|
|
|
|
|
|
As at 30.06.17
|
As at 31.12.16
|
As at 30.06.16
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Total assets
|
17.3
|
75.2
|
87.7
|
Risk weighted assets
1
|
26.2
|
53.3
|
43.2
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
|
30.06.17
|
30.06.16
|
|
Performance measures
|
£bn
|
£bn
|
|
Average allocated tangible equity
|
8.2
|
5.8
|
|
1
|
Includes Africa Banking risk weighted assets of £9.8bn
(December 2016: £42.3bn).
|
Head Office
Income statement – H117 compared to H116
●
|
Loss
before tax was £263m (H116: profit of £134m)
|
●
|
Total
income reduced £299m to £2m following the early adoption
of the own credit provisions of IFRS 9 on 1 January 2017 and lower
net income from treasury operations. Own credit, which was
previously recorded in the income statement (H116: gain of
£183m), is now recognised within other comprehensive
income
|
●
|
Other
net expenses increased to £164m (H116: £27m) driven by an
expense of £180m on the recycling of the currency translation
reserve to the income statement on the sale of Barclays Bank
Egypt
|
Balance sheet – 30 June 2017 compared to 31 December
2016
●
|
Total
assets decreased to £17.3bn (December 2016: £75.2bn)
primarily due to the sale of 33.7% of BAGL’s issued share
capital resulting in the accounting deconsolidation of BAGL from
the Barclays Group
|
●
|
RWAs
decreased to £26.2bn (December 2016: £53.3bn) reflecting
a £27.9bn reduction as a result of the proportional
consolidation of BAGL
|
Barclays Non-Core
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
YoY
|
Income statement information
|
£m
|
£m
|
% Change
|
Net interest income
|
(112)
|
136
|
|
Net trading income
|
(488)
|
(953)
|
49
|
Net fee, commission and other income
|
70
|
231
|
(70)
|
Total income
|
(530)
|
(586)
|
10
|
Credit impairment charges and other provisions
|
(30)
|
(55)
|
45
|
Net operating expenses
|
(560)
|
(641)
|
13
|
Operating expenses excluding litigation and conduct
|
(256)
|
(857)
|
70
|
Litigation and conduct
|
(28)
|
(93)
|
70
|
Operating expenses
|
(284)
|
(950)
|
70
|
Other net income/(expenses)
|
197
|
(313)
|
|
Loss before tax
|
(647)
|
(1,904)
|
66
|
Attributable loss
|
(419)
|
(1,490)
|
72
|
|
|
|
|
|
As at 30.06.17
|
As at 31.12.16
|
As at 30.06.16
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Loans and advances to banks and customers at amortised
cost
1
|
48.3
|
51.1
|
68.5
|
Derivative financial instrument assets
|
150.3
|
188.7
|
262.8
|
Derivative financial instrument liabilities
|
143.0
|
178.6
|
253.4
|
Reverse repurchase agreements and other similar secured
lending
|
-
|
0.1
|
0.1
|
Financial assets designated at fair value
|
12.1
|
14.5
|
15.4
|
Total assets
|
233.0
|
279.7
|
379.1
|
Customer deposits
2
|
11.8
|
12.5
|
17.4
|
Risk weighted assets
|
22.8
|
32.1
|
46.7
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
Performance measures
|
30.06.17
|
30.06.16
|
|
Average allocated tangible equity (£bn)
|
4.9
|
8.5
|
|
Period end allocated tangible equity (£bn)
|
4.0
|
7.8
|
|
Loan loss rate (bps)
|
12
|
15
|
|
|
|
|
|
|
|
|
YoY
|
Analysis of total income
|
£m
|
£m
|
% Change
|
Businesses
|
10
|
377
|
(97)
|
Securities and loans
|
43
|
(765)
|
|
Derivatives
|
(583)
|
(198)
|
|
Total income
|
(530)
|
(586)
|
10
|
1
|
As at 30 June 2017 loans and advances included £37.1bn
(December 2016: £38.5bn) of loans and advances to customers
(including settlement balances of £nil (December 2016:
£0.1bn) and cash collateral of £15.3bn (December 2016:
£17.3bn)), and £11.2bn (December 2016: £12.6bn) of
loans and advances to banks (including settlement balances of
£nil (December 2016: £0.1bn) and cash collateral of
£10.9bn (December 2016: £12.1bn)).
|
2
|
As at 30 June 2017 customer deposits included settlement balances
of £nil (December 2016 £0.1bn) and cash collateral of
£11.4bn (December 2016: £11.9bn).
|
Barclays Non-Core
Income statement – H117 compared to H116
●
|
Loss
before tax reduced to £647m (H116: £1,904m) driven by
lower operating expenses, favourable fair value movements on the
ESHLA portfolio, the non-recurrence of impairment associated with
the valuation of the French retail business in H116 and a gain on
the sale of Barclays Bank Egypt
|
●
|
Total
income increased £56m to a net expense of
£530m
|
–
|
Businesses
income reduced to £10m (H116: £377m) primarily due to the
completion of the sale of the Italian retail, Southern European
cards and Barclays Bank Egypt businesses
|
–
|
Securities
and loans income increased £808m to net income of £43m
primarily driven by fair value gains of £44m (H116: £424m
expense) on the ESHLA portfolio and the non-recurrence of the
£182m loss associated with the restructure of the ESHLA
portfolio loan terms in H116
|
–
|
Derivatives
income reduced £385m to an expense of £583m reflecting
losses on the rundown of the portfolio
|
●
|
Credit
impairment charges improved 45% to £30m due to higher
recoveries across Europe and investment banking
activities
|
●
|
Total
operating expenses improved 70% to £284m reflecting the
completion of the sale of several businesses, a reduction in
restructuring charges, and lower litigation and conduct
charges
|
●
|
Other
net income of £197m (H116: £313m expense) included a
£189m gain on the sale of Barclays Bank Egypt. H116 included a
£372m impairment associated with the valuation of the French
retail business
|
Balance sheet – 30 June 2017 compared to 31 December
2016
●
|
Loans
and advances to banks and customers at amortised cost decreased 5%
to £48.3bn due to a decrease in cash collateral assets,
partially offset by the reclassification of £1.5bn of ESHLA
loans now recognised at amortised cost, following the restructuring
of certain loans within the portfolio
|
●
|
Derivative
financial instrument assets and liabilities decreased 20% to
£150.3bn and 20% to £143.0bn respectively, due to the
continued rundown of the derivative back book and an increase in
major interest rate forward curves
|
●
|
Customer
deposits decreased 6% to £11.8bn due to a decrease in cash
collateral
|
●
|
Total
assets decreased 17% to £233.0bn due to lower derivative
financial instrument assets
|
●
|
RWAs
reduced £9.3bn to £22.8bn including a £5bn reduction
in Derivatives, a £2bn reduction in Businesses and a £1bn
reduction in Securities and loans
|
Barclays Non-Core closure and reintegration into Core
●
|
The
Non-Core segment was closed on 1 July 2017 with the residual assets
and liabilities, and prospective financial performance to be
reintegrated into Barclays UK, Barclays International and Head
Office. Financial results up until 30 June 2017 will continue to be
reflected in the Non-Core
|
–
|
As at
30 June 2017 Non-Core RWAs were £22.8bn. It is estimated that
c.£3.5bn will be reintegrated with Barclays UK comprising of
ESHLA loans excluding higher education, c.£8.8bn will be
reintegrated with Barclays International, primarily relating to
derivatives and ESHLA higher education, and c.£10.5bn will be
reintegrated with Head Office, primarily relating to Italian
mortgages and operational risk
|
●
|
Guidance
of a Non-Core loss before tax for 2017 of approximately £1bn
is unchanged, with a loss before tax of approximately
£300-400m in H217. The H217 loss before tax is anticipated to
be split c.10% to Barclays UK, c.40% to Barclays International and
c.50% to Head Office
|
●
|
As
previously guided to, it is expected that risk weighted assets and
loss before tax previously associated with Non-Core will continue
to reduce in future periods
|
|
|
Moves to
|
Balance sheet information
(£bn)
1
|
Barclays Non-Core
|
Barclays UK
|
Barclays International
|
Head Office
|
Loans and advances to banks and customers at amortised
cost
|
48.3
|
10.1
|
28.9
|
9.3
|
Derivative financial instrument assets
|
150.3
|
-
|
150.3
|
-
|
Derivative financial instrument liabilities
|
143.0
|
-
|
143.0
|
-
|
Financial assets designated at fair value
|
12.1
|
8.2
|
3.2
|
0.7
|
Total assets
|
233.0
|
18.3
|
200.3
|
14.4
|
Customer deposits
|
11.8
|
-
|
11.7
|
0.1
|
Risk weighted assets
|
22.8
|
3.5
|
8.8
|
10.5
|
Period end allocated tangible equity
|
4.0
|
0.7
|
1.6
|
1.7
|
1
|
Estimated allocation based on 30.06.17 balance sheet.
|
Discontinued Operation Results
Disposal of the shares in BAGL
On 1
March 2016, Barclays announced its intention to reduce the
Group’s 62.3% interest in BAGL to a level which would permit
Barclays to deconsolidate BAGL from a regulatory perspective and,
prior to that, from an accounting perspective. From this date, BAGL
was treated as a discontinued operation. On 5 May 2016, Barclays
sold 12.2% of the Group’s interest in BAGL, reducing
Barclays’ interest to 50.1% of BAGL’s issued share
capital.
In
December 2016, Barclays agreed the terms of the transitional
services arrangements and separation payments of £0.7bn, as
announced in Barclays’ 2016 Annual Report.
Following
receipt of the required regulatory approvals, on 1 June 2017
Barclays sold 286 million ordinary shares of BAGL, representing
33.7% of BAGL’s issued share capital, of which 7.0% is
allocated to the Public Investment Corporation (PIC) who is
expected to take receipt of the shares following the necessary
regulatory approvals. Following the sale, as at 30 June 2017
Barclays accounted for 139 million ordinary shares in BAGL,
representing 16.4% of BAGL’s issued share capital. An amount
of £1,141m was recognised on the balance sheet at the date of
disposal, representing the fair value.
Additionally,
as at 30 June 2017 Barclays had an obligation to contribute 1.5% of
BAGL’s ordinary shares or the cash equivalent to a Black
Economic Empowerment (BEE) scheme. As at 30 September 2017,
Barclays will account for 126 million ordinary shares in BAGL,
currently representing 14.9% of BAGL’s issued share capital.
A liability for the obligation to the BEE scheme of £105m is
reflected on the balance sheet.
Financial performance
The
discontinued operation reported a loss before tax of £2,041m
in H117, representing (i) a profit before tax on Africa Banking
operations for five months to 31 May 2017, excluding impairment of
Barclays' holding in BAGL and loss on sale of BAGL, of £484m,
(ii) a £60m loss on sale of the 33.7% share of BAGL’s
issued share capital on 1 June 2017, (iii) a £1,375m loss on
recycling of Other Comprehensive Income reserves of which
£1,377m relates to the currency translation reserve, owing to
the weakening of the ZAR since initial consolidation of BAGL in
2005, and (iv) a £1,090m impairment of Barclays’ holding
in BAGL, predominantly allocated to acquisition goodwill. The
recycling of the currency translation reserve and the impairment of
Barclays’ holding in BAGL allocated to acquisition goodwill
had no effect on the Group’s tangible net asset value or CET1
ratio.
Accounting and regulatory treatment
The
sale of 33.7% of BAGL’s issued share capital resulted in the
accounting deconsolidation of BAGL from the Barclays Group, as of 1
June 2017. Barclays’ holding in BAGL technically met the
requirements to be treated as an Associate, the subsequent revision
of its governance rights in July 2017 means that it is treated as
an Available for Sale (AFS) asset. Given the immateriality of the
differences between the accounting treatments since 1 June it has
been determined that it would be appropriate to treat this holding
as an AFS asset since 1 June 2017. BAGL is consequently no longer
reported as a discontinued operation and the retained investment
will be reported in the Head Office segment. Barclays’ share
of BAGL’s dividend will be recognised in the Group’s
income statement when the right to receive the dividend has been
established, and changes in fair value of the asset will be
recognised in the AFS reserve.
For
regulatory reporting purposes, BAGL is treated at 30 June 2017 on a
proportional consolidated basis based on a holding of 23.4%. The
Group’s CET1 ratio increased 47bps as a result of the sale
and reflecting the proportional consolidation of BAGL. Barclays
expects to proportionally consolidate BAGL in H217 based on a
holding of 14.9%, following the contribution of 1.5% of
BAGL’s issued share capital to a BEE scheme and the expected
delivery of 7.0% of BAGL’s issued share capital to PIC.
Subject to regulatory approval, Barclays expects to fully
deconsolidate BAGL from a regulatory perspective within 18 months.
The estimated future accretion to the Group’s CET1 ratio is
c.26bps in aggregate.
Africa Banking
|
|
|
|
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
YoY
|
Income statement information
¹
|
£m
|
£m
|
% Change
|
Net interest income
|
1,024
|
982
|
4
|
Net fee, commission and other income
|
762
|
715
|
7
|
Total income
|
1,786
|
1,697
|
5
|
Credit impairment charges and other provisions
|
(177)
|
(244)
|
27
|
Net operating income
|
1,609
|
1,453
|
11
|
Operating expenses excluding impairment of Barclays' holding in
BAGL
|
(1,130)
|
(1,020)
|
(11)
|
Other net income excluding loss on sale of BAGL
|
5
|
2
|
|
Profit before tax excluding impairment of Barclays' holding in BAGL
and loss on sale of BAGL
|
484
|
435
|
11
|
Impairment of Barclays' holding in BAGL
|
(1,090)
|
-
|
|
Loss on sale of BAGL
|
(1,435)
|
-
|
|
(Loss)/profit before tax
|
(2,041)
|
435
|
|
Tax charge
|
(154)
|
(124)
|
(24)
|
(Loss)/profit after tax
|
(2,195)
|
311
|
|
Attributable (loss)/profit
|
(2,335)
|
156
|
|
|
|
|
|
|
As at 30.06.17
|
As at 31.12.16
|
As at 30.06.16
|
Balance sheet information
|
£bn
|
£bn
|
£bn
|
Total assets
|
-
|
65.1
|
56.0
|
Risk weighted assets
2
|
9.8
|
42.3
|
36.1
|
1
|
The H117 Africa Banking income statement represents five months of
results as a discontinued operation to 31 May 2017.
|
2
|
Africa Banking (excluding Egypt and Zimbabwe) RWAs are reported in
Head Office within Core.
|
|
Q217
|
Q117
|
|
Q416
|
Q316
|
Q216
|
Q116
|
|
Q415
|
Q315
|
Income statement
information
1
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
407
|
617
|
|
626
|
561
|
502
|
480
|
|
468
|
471
|
Net fee, commission and other income
|
297
|
465
|
|
441
|
421
|
377
|
338
|
|
346
|
351
|
Total income
|
704
|
1,082
|
|
1,067
|
982
|
879
|
818
|
|
814
|
822
|
Credit impairment charges and other provisions
|
(71)
|
(106)
|
|
(105)
|
(96)
|
(133)
|
(111)
|
|
(93)
|
(66)
|
Net operating income
|
633
|
976
|
|
962
|
886
|
746
|
707
|
|
721
|
756
|
Operating expenses excluding UK bank levy and impairment of
Barclays' holding in BAGL
|
(477)
|
(653)
|
|
(727)
|
(598)
|
(543)
|
(477)
|
|
(501)
|
(515)
|
UK bank levy
|
-
|
-
|
|
(65)
|
-
|
-
|
-
|
|
(50)
|
-
|
Other net income excluding loss on sale of BAGL
|
3
|
2
|
|
2
|
2
|
1
|
1
|
|
3
|
1
|
Profit before tax excluding impairment of Barclays' holding in BAGL
and loss on sale of BAGL
|
159
|
325
|
|
172
|
290
|
204
|
231
|
|
173
|
242
|
Impairment of Barclays' holding in BAGL
|
(206)
|
(884)
|
|
-
|
-
|
-
|
-
|
|
-
|
-
|
Loss on sale of BAGL
|
(1,435)
|
-
|
|
-
|
-
|
-
|
-
|
|
-
|
-
|
(Loss)/profit before tax
|
(1,482)
|
(559)
|
|
172
|
290
|
204
|
231
|
|
173
|
242
|
(Loss)/profit after tax
|
(1,537)
|
(658)
|
|
71
|
209
|
145
|
166
|
|
101
|
167
|
Attributable (loss)/profit
|
(1,534)
|
(801)
|
|
(52)
|
85
|
70
|
86
|
|
25
|
85
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Total assets
|
-
|
66.0
|
|
65.1
|
61.1
|
56.0
|
52.7
|
|
47.9
|
50.2
|
Risk weighted assets
|
9.8
|
41.3
|
|
42.3
|
39.9
|
36.1
|
33.9
|
|
31.7
|
33.8
|
1
|
The Q217 Africa Banking income statement represents two months of
results as a discontinued operation to 31 May 2017.
|
Quarterly Results Summary
Barclays Group
|
|
|
|
|
|
|
|
|
|
|
|
Q217
|
Q117
|
|
Q416
|
Q316
|
Q216
|
Q116
|
|
Q415
|
Q315
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
2,579
|
2,519
|
|
2,523
|
2,796
|
2,530
|
2,688
|
|
2,726
|
2,692
|
Net fee, commission and other income
|
2,479
|
3,304
|
|
2,469
|
2,650
|
3,442
|
2,353
|
|
1,722
|
2,789
|
Total income
|
5,058
|
5,823
|
|
4,992
|
5,446
|
5,972
|
5,041
|
|
4,448
|
5,481
|
Credit impairment charges and other provisions
|
(527)
|
(527)
|
|
(653)
|
(789)
|
(488)
|
(443)
|
|
(554)
|
(429)
|
Net operating income
|
4,531
|
5,296
|
|
4,339
|
4,657
|
5,484
|
4,598
|
|
3,894
|
5,052
|
Operating expenses excluding UK bank levy and litigation and
conduct
|
(3,398)
|
(3,591)
|
|
(3,812)
|
(3,581)
|
(3,425)
|
(3,747)
|
|
(3,547)
|
(3,552)
|
UK bank levy
|
-
|
-
|
|
(410)
|
-
|
-
|
-
|
|
(426)
|
-
|
Litigation and conduct
|
(715)
|
(28)
|
|
(97)
|
(741)
|
(447)
|
(78)
|
|
(1,722)
|
(699)
|
Operating expenses
|
(4,113)
|
(3,619)
|
|
(4,319)
|
(4,322)
|
(3,872)
|
(3,825)
|
|
(5,695)
|
(4,251)
|
Other net income/(expenses)
|
241
|
5
|
|
310
|
502
|
(342)
|
20
|
|
(274)
|
(182)
|
Profit/(loss) before tax
|
659
|
1,682
|
|
330
|
837
|
1,270
|
793
|
|
(2,075)
|
619
|
Tax (charge)/credit
|
(305)
|
(473)
|
|
50
|
(328)
|
(467)
|
(248)
|
|
(164)
|
(133)
|
Profit/(loss) after tax in respect of continuing
operations
|
354
|
1,209
|
|
380
|
509
|
803
|
545
|
|
(2,239)
|
486
|
(Loss)/profit after tax in respect of discontinued
operation
|
(1,537)
|
(658)
|
|
71
|
209
|
145
|
166
|
|
101
|
167
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
|
Ordinary equity holders of the parent
|
(1,401)
|
190
|
|
99
|
414
|
677
|
433
|
|
(2,422)
|
417
|
Other equity holders
|
162
|
139
|
|
139
|
110
|
104
|
104
|
|
107
|
79
|
Non-controlling interests
|
56
|
222
|
|
213
|
194
|
167
|
174
|
|
177
|
157
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Total assets
|
1,135.3
|
1,203.8
|
|
1,213.1
|
1,324.0
|
1,351.3
|
1,248.9
|
|
1,120.0
|
1,236.5
|
Risk weighted assets
|
327.4
|
360.9
|
|
365.6
|
373.4
|
366.3
|
363.0
|
|
358.4
|
381.9
|
CRR leverage exposure
|
1,122.1
|
1,196.9
|
|
1,125.5
|
1,185.1
|
1,155.4
|
1,082.0
|
|
1,027.8
|
1,140.7
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average tangible shareholders' equity
|
(11.0%)
|
1.8%
|
|
1.1%
|
3.6%
|
5.8%
|
3.8%
|
|
(20.1%)
|
3.6%
|
Average tangible shareholders' equity (£bn)
|
49.3
|
49.4
|
|
48.9
|
49.4
|
48.3
|
48.3
|
|
47.8
|
47.6
|
Cost: income ratio
|
81%
|
62%
|
|
87%
|
79%
|
65%
|
76%
|
|
128%
|
78%
|
Loan loss rate (bps)
|
49
|
47
|
|
58
|
66
|
41
|
40
|
|
53
|
37
|
Basic (loss)/earnings per share
|
(8.0p)
|
1.3p
|
|
0.8p
|
2.6p
|
4.2p
|
2.7p
|
|
(14.4p)
|
2.6p
|
Basic earnings/(loss) per share in respect of continuing
operations
|
1.0p
|
6.1p
|
|
1.1p
|
2.1p
|
3.8p
|
2.2p
|
|
(14.4p)
|
2.1p
|
Barclays Core
|
|
|
|
|
|
|
|
|
|
|
|
Q217
|
Q117
|
|
Q416
|
Q316
|
Q216
|
Q116
|
|
Q415
|
Q315
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
2,702
|
2,508
|
|
2,577
|
2,718
|
2,491
|
2,591
|
|
2,555
|
2,557
|
Net fee, commission and other income
|
2,812
|
3,389
|
|
2,834
|
2,887
|
3,825
|
2,692
|
|
1,961
|
2,708
|
Total income
|
5,514
|
5,897
|
|
5,411
|
5,605
|
6,316
|
5,283
|
|
4,516
|
5,265
|
Credit impairment charges and other provisions
|
(500)
|
(524)
|
|
(606)
|
(769)
|
(462)
|
(414)
|
|
(522)
|
(388)
|
Net operating income
|
5,014
|
5,373
|
|
4,805
|
4,836
|
5,854
|
4,869
|
|
3,994
|
4,877
|
Operating expenses excluding UK bank levy and litigation and
conduct
|
(3,290)
|
(3,443)
|
|
(3,471)
|
(3,270)
|
(3,057)
|
(3,258)
|
|
(2,992)
|
(3,094)
|
UK bank levy
|
-
|
-
|
|
(334)
|
-
|
-
|
-
|
|
(338)
|
-
|
Litigation and conduct
|
(696)
|
(19)
|
|
(46)
|
(639)
|
(420)
|
(12)
|
|
(1,634)
|
(419)
|
Operating expenses
|
(3,986)
|
(3,462)
|
|
(3,851)
|
(3,909)
|
(3,477)
|
(3,270)
|
|
(4,964)
|
(3,513)
|
Other net income/(expenses)
|
37
|
12
|
|
164
|
4
|
(18)
|
9
|
|
(5)
|
13
|
Profit/(loss) before tax
|
1,065
|
1,923
|
|
1,118
|
931
|
2,359
|
1,608
|
|
(975)
|
1,377
|
Tax charge
|
(512)
|
(548)
|
|
(272)
|
(522)
|
(696)
|
(485)
|
|
(92)
|
(299)
|
Profit/(loss) after tax
|
553
|
1,375
|
|
846
|
409
|
1,663
|
1,123
|
|
(1,067)
|
1,078
|
Non-controlling interests
|
(51)
|
(70)
|
|
(76)
|
(57)
|
(80)
|
(84)
|
|
(81)
|
(54)
|
Other equity holders
|
(143)
|
(121)
|
|
(121)
|
(95)
|
(89)
|
(89)
|
|
(92)
|
(63)
|
Attributable profit/(loss)
|
359
|
1,184
|
|
649
|
257
|
1,494
|
950
|
|
(1,240)
|
961
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Total assets
|
902.3
|
954.7
|
|
933.4
|
964.3
|
972.2
|
883.6
|
|
794.2
|
862.0
|
Risk weighted assets
|
304.6
|
333.5
|
|
333.5
|
329.5
|
319.6
|
312.2
|
|
304.1
|
316.3
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
3.6%
|
11.0%
|
|
6.4%
|
2.7%
|
15.0%
|
9.9%
|
|
(12.8%)
|
10.4%
|
Average allocated tangible equity (£bn)
|
44.9
|
44.2
|
|
42.4
|
41.8
|
40.4
|
39.3
|
|
38.1
|
37.5
|
Cost: income ratio
|
72%
|
59%
|
|
71%
|
70%
|
55%
|
62%
|
|
110%
|
67%
|
Loan loss rate (bps)
|
52
|
53
|
|
61
|
74
|
45
|
42
|
|
57
|
39
|
Basic earnings/(loss) per share contribution
|
2.3p
|
7.2p
|
|
4.0p
|
1.7p
|
9.0p
|
5.8p
|
|
(7.3p)
|
5.8p
|
Barclays Non-Core
|
|
|
|
|
|
|
|
|
|
|
|
Q217
|
Q117
|
|
Q416
|
Q316
|
Q216
|
Q116
|
|
Q415
|
Q315
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
(123)
|
11
|
|
(54)
|
78
|
40
|
96
|
|
171
|
135
|
Net trading income
|
(411)
|
(77)
|
|
(462)
|
(288)
|
(463)
|
(490)
|
|
(398)
|
(124)
|
Net fee, commission and other income
|
78
|
(8)
|
|
97
|
51
|
79
|
152
|
|
159
|
204
|
Total income
|
(456)
|
(74)
|
|
(419)
|
(159)
|
(344)
|
(242)
|
|
(68)
|
215
|
Credit impairment charges and other provisions
|
(27)
|
(3)
|
|
(47)
|
(20)
|
(26)
|
(29)
|
|
(32)
|
(41)
|
Net operating (expenses)/income
|
(483)
|
(77)
|
|
(466)
|
(179)
|
(370)
|
(271)
|
|
(100)
|
174
|
Operating expenses excluding UK bank levy and litigation and
conduct
|
(108)
|
(148)
|
|
(341)
|
(311)
|
(368)
|
(489)
|
|
(555)
|
(458)
|
UK bank levy
|
-
|
-
|
|
(76)
|
-
|
-
|
-
|
|
(88)
|
-
|
Litigation and conduct
|
(19)
|
(9)
|
|
(51)
|
(102)
|
(27)
|
(66)
|
|
(89)
|
(279)
|
Operating expenses
|
(127)
|
(157)
|
|
(468)
|
(413)
|
(395)
|
(555)
|
|
(732)
|
(737)
|
Other net income/(expenses)
|
204
|
(7)
|
|
146
|
498
|
(324)
|
11
|
|
(268)
|
(195)
|
Loss before tax
|
(406)
|
(241)
|
|
(788)
|
(94)
|
(1,089)
|
(815)
|
|
(1,100)
|
(758)
|
Tax credit/(charge)
|
207
|
75
|
|
322
|
194
|
229
|
237
|
|
(72)
|
166
|
(Loss)/profit after tax
|
(199)
|
(166)
|
|
(466)
|
100
|
(860)
|
(578)
|
|
(1,172)
|
(592)
|
Non-controlling interests
|
(8)
|
(9)
|
|
(14)
|
(13)
|
(12)
|
(10)
|
|
(19)
|
(21)
|
Other equity holders
|
(19)
|
(18)
|
|
(18)
|
(15)
|
(15)
|
(15)
|
|
(17)
|
(15)
|
Attributable (loss)/profit
|
(226)
|
(193)
|
|
(498)
|
72
|
(887)
|
(603)
|
|
(1,208)
|
(628)
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances to banks and customers at amortised
cost
|
48.3
|
49.5
|
|
51.1
|
58.7
|
68.5
|
55.4
|
|
51.8
|
57.1
|
Derivative financial instrument assets
|
150.3
|
164.2
|
|
188.7
|
253.2
|
262.8
|
249.7
|
|
213.7
|
243.3
|
Derivative financial instrument liabilities
|
143.0
|
155.3
|
|
178.6
|
243.0
|
253.4
|
239.1
|
|
202.1
|
235.0
|
Reverse repurchase agreements and other similar secured
lending
|
-
|
-
|
|
0.1
|
0.1
|
0.1
|
0.7
|
|
3.1
|
8.5
|
Financial assets designated at fair value
|
12.1
|
13.4
|
|
14.5
|
15.5
|
15.4
|
23.4
|
|
21.4
|
22.8
|
Total assets
|
233.0
|
249.1
|
|
279.7
|
359.8
|
379.1
|
365.4
|
|
325.8
|
374.5
|
Customer deposits
|
11.8
|
12.9
|
|
12.5
|
16.0
|
17.4
|
19.3
|
|
20.9
|
25.8
|
Risk weighted assets
|
22.8
|
27.4
|
|
32.1
|
43.9
|
46.7
|
50.9
|
|
54.3
|
65.6
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Average allocated tangible equity (£bn)
|
4.5
|
5.2
|
|
6.5
|
7.6
|
7.9
|
9.0
|
|
9.7
|
10.2
|
Period end allocated tangible equity (£bn)
|
4.0
|
4.8
|
|
5.4
|
7.2
|
7.8
|
8.5
|
|
8.5
|
10.2
|
Loan loss rate (bps)
|
22
|
2
|
|
31
|
13
|
14
|
21
|
|
25
|
27
|
Basic (loss)/earnings per share contribution
|
(1.3p)
|
(1.1p)
|
|
(2.9p)
|
0.5p
|
(5.2p)
|
(3.6p)
|
|
(7.2p)
|
(3.7p)
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of total income
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Businesses
|
(41)
|
51
|
|
(73)
|
181
|
181
|
196
|
|
229
|
314
|
Securities and loans
|
(25)
|
68
|
|
161
|
(34)
|
(363)
|
(402)
|
|
(195)
|
(87)
|
Derivatives
|
(390)
|
(193)
|
|
(507)
|
(306)
|
(162)
|
(36)
|
|
(102)
|
(12)
|
Total income
|
(456)
|
(74)
|
|
(419)
|
(159)
|
(344)
|
(242)
|
|
(68)
|
215
|
Quarterly Core Results by Business
Barclays UK
|
|
|
|
|
|
|
|
|
|
|
|
Q217
|
Q117
|
|
Q416
|
Q316
|
Q216
|
Q116
|
|
Q415
|
Q315
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
1,534
|
1,511
|
|
1,502
|
1,569
|
1,476
|
1,501
|
|
1,509
|
1,499
|
Net fee, commission and other income
|
286
|
330
|
|
326
|
374
|
467
|
302
|
|
325
|
375
|
Total income
|
1,820
|
1,841
|
|
1,828
|
1,943
|
1,943
|
1,803
|
|
1,834
|
1,874
|
Credit impairment charges and other provisions
|
(220)
|
(178)
|
|
(180)
|
(350)
|
(220)
|
(146)
|
|
(219)
|
(154)
|
Net operating income
|
1,600
|
1,663
|
|
1,648
|
1,593
|
1,723
|
1,657
|
|
1,615
|
1,720
|
Operating expenses excluding UK bank levy and litigation and
conduct
|
(974)
|
(959)
|
|
(989)
|
(904)
|
(947)
|
(952)
|
|
(920)
|
(925)
|
UK bank levy
|
-
|
-
|
|
(48)
|
-
|
-
|
-
|
|
(77)
|
-
|
Litigation and conduct
|
(699)
|
4
|
|
(28)
|
(614)
|
(399)
|
(1)
|
|
(1,466)
|
(76)
|
Operating expenses
|
(1,673)
|
(955)
|
|
(1,065)
|
(1,518)
|
(1,346)
|
(953)
|
|
(2,463)
|
(1,001)
|
Other net (expenses)/income
|
(1)
|
-
|
|
-
|
-
|
(1)
|
-
|
|
1
|
1
|
(Loss)/profit before tax
|
(74)
|
708
|
|
583
|
75
|
376
|
704
|
|
(847)
|
720
|
Attributable (loss)/profit
|
(285)
|
470
|
|
383
|
(163)
|
141
|
467
|
|
(1,078)
|
541
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances to customers at amortised cost
|
166.6
|
164.5
|
|
166.4
|
166.6
|
166.0
|
166.2
|
|
166.1
|
166.7
|
Total assets
|
203.4
|
203.0
|
|
209.6
|
209.1
|
204.6
|
201.7
|
|
202.5
|
204.1
|
Customer deposits
|
187.4
|
184.4
|
|
189.0
|
185.5
|
181.7
|
179.1
|
|
176.8
|
173.4
|
Risk weighted assets
|
66.1
|
66.3
|
|
67.5
|
67.4
|
67.1
|
69.7
|
|
69.5
|
71.0
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
(12.7%)
|
21.6%
|
|
18.2%
|
(7.1%)
|
6.6%
|
20.5%
|
|
(46.5%)
|
23.3%
|
Average allocated tangible equity (£bn)
|
8.7
|
8.9
|
|
8.6
|
8.7
|
9.0
|
9.3
|
|
9.2
|
9.3
|
Cost: income ratio
|
92%
|
52%
|
|
58%
|
78%
|
69%
|
53%
|
|
134%
|
53%
|
Loan loss rate (bps)
|
52
|
43
|
|
42
|
82
|
52
|
34
|
|
51
|
36
|
Net interest margin
|
3.70%
|
3.69%
|
|
3.56%
|
3.72%
|
3.56%
|
3.62%
|
|
3.58%
|
3.54%
|
Analysis of Barclays UK
|
|
|
|
|
|
|
|
|
|
|
|
Q217
|
Q117
|
|
Q416
|
Q316
|
Q216
|
Q116
|
|
Q415
|
Q315
|
Analysis of total income
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Personal Banking
|
933
|
944
|
|
934
|
970
|
1,068
|
919
|
|
945
|
938
|
Barclaycard Consumer UK
|
495
|
498
|
|
507
|
561
|
463
|
491
|
|
505
|
552
|
Wealth, Entrepreneurs & Business Banking
|
392
|
399
|
|
387
|
412
|
412
|
393
|
|
384
|
384
|
Total income
|
1,820
|
1,841
|
|
1,828
|
1,943
|
1,943
|
1,803
|
|
1,834
|
1,874
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of credit impairment charges and other
provisions
|
|
|
|
|
|
|
|
|
|
|
Personal Banking
|
(56)
|
(50)
|
|
(50)
|
(47)
|
(44)
|
(42)
|
|
(39)
|
(36)
|
Barclaycard Consumer UK
|
(149)
|
(123)
|
|
(118)
|
(291)
|
(169)
|
(105)
|
|
(176)
|
(111)
|
Wealth, Entrepreneurs & Business Banking
|
(15)
|
(5)
|
|
(12)
|
(12)
|
(7)
|
1
|
|
(4)
|
(7)
|
Total credit impairment charges and other provisions
|
(220)
|
(178)
|
|
(180)
|
(350)
|
(220)
|
(146)
|
|
(219)
|
(154)
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of loans and advances to customers at amortised
cost
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Personal Banking
|
136.5
|
134.4
|
|
135.0
|
135.3
|
134.7
|
134.7
|
|
134.0
|
134.5
|
Barclaycard Consumer UK
|
16.2
|
16.1
|
|
16.5
|
16.2
|
16.2
|
16.0
|
|
16.2
|
15.9
|
Wealth, Entrepreneurs & Business Banking
|
13.9
|
14.0
|
|
14.9
|
15.1
|
15.1
|
15.5
|
|
15.9
|
16.3
|
Total loans and advances to customers at amortised
cost
|
166.6
|
164.5
|
|
166.4
|
166.6
|
166.0
|
166.2
|
|
166.1
|
166.7
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of customer deposits
|
|
|
|
|
|
|
|
|
|
|
Personal Banking
|
138.5
|
137.3
|
|
139.3
|
137.2
|
134.8
|
132.9
|
|
131.0
|
128.4
|
Barclaycard Consumer UK
|
-
|
-
|
|
-
|
-
|
-
|
-
|
|
-
|
-
|
Wealth, Entrepreneurs & Business Banking
|
48.9
|
47.1
|
|
49.7
|
48.3
|
46.9
|
46.2
|
|
45.8
|
45.0
|
Total customer deposits
|
187.4
|
184.4
|
|
189.0
|
185.5
|
181.7
|
179.1
|
|
176.8
|
173.4
|
Barclays International
|
|
|
|
|
|
|
|
|
|
|
|
Q217
|
Q117
|
|
Q416
|
Q316
|
Q216
|
Q116
|
|
Q415
|
Q315
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
1,060
|
1,112
|
|
1,046
|
1,355
|
1,001
|
1,110
|
|
1,121
|
1,109
|
Net trading income
|
1,039
|
1,182
|
|
1,131
|
1,074
|
1,130
|
1,245
|
|
593
|
817
|
Net fee, commission and other income
|
1,511
|
1,844
|
|
1,415
|
1,422
|
1,908
|
1,158
|
|
1,254
|
1,297
|
Total income
|
3,610
|
4,138
|
|
3,592
|
3,851
|
4,039
|
3,513
|
|
2,968
|
3,223
|
Credit impairment charges and other provisions
|
(279)
|
(346)
|
|
(426)
|
(420)
|
(240)
|
(269)
|
|
(303)
|
(235)
|
Net operating income
|
3,331
|
3,792
|
|
3,166
|
3,431
|
3,799
|
3,244
|
|
2,665
|
2,988
|
Operating expenses excluding UK bank levy and litigation and
conduct
|
(2,276)
|
(2,435)
|
|
(2,497)
|
(2,337)
|
(2,074)
|
(2,221)
|
|
(2,007)
|
(2,059)
|
UK bank levy
|
-
|
-
|
|
(284)
|
-
|
-
|
-
|
|
(253)
|
-
|
Litigation and conduct
|
4
|
(13)
|
|
(17)
|
(17)
|
(10)
|
(4)
|
|
(151)
|
(302)
|
Operating expenses
|
(2,272)
|
(2,448)
|
|
(2,798)
|
(2,354)
|
(2,084)
|
(2,225)
|
|
(2,411)
|
(2,361)
|
Other net income
|
202
|
12
|
|
5
|
8
|
11
|
8
|
|
8
|
9
|
Profit before tax
|
1,261
|
1,356
|
|
373
|
1,085
|
1,726
|
1,027
|
|
262
|
636
|
Attributable profit/(loss)
|
819
|
837
|
|
43
|
623
|
1,171
|
575
|
|
(24)
|
422
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances to banks and customers at amortised
cost
|
204.8
|
226.1
|
|
211.3
|
233.7
|
230.6
|
215.9
|
|
184.1
|
220.3
|
Trading portfolio assets
|
83.3
|
83.0
|
|
73.2
|
73.8
|
68.1
|
64.3
|
|
61.9
|
72.8
|
Derivative financial instrument assets
|
108.4
|
105.3
|
|
156.2
|
155.6
|
181.4
|
150.1
|
|
111.5
|
133.7
|
Derivative financial instrument liabilities
|
116.8
|
112.8
|
|
160.6
|
160.5
|
187.5
|
155.4
|
|
119.0
|
142.0
|
Reverse repurchase agreements and other similar secured
lending
|
17.2
|
17.6
|
|
13.4
|
17.3
|
19.7
|
19.1
|
|
24.7
|
68.0
|
Financial assets designated at fair value
|
94.1
|
81.3
|
|
62.3
|
72.0
|
68.3
|
59.6
|
|
46.8
|
5.6
|
Total assets
|
681.6
|
677.2
|
|
648.5
|
681.9
|
679.9
|
618.4
|
|
532.2
|
596.1
|
Customer deposits
|
230.3
|
241.0
|
|
216.2
|
224.1
|
226.5
|
213.1
|
|
185.6
|
207.0
|
Risk weighted assets
|
212.2
|
214.3
|
|
212.7
|
214.6
|
209.3
|
202.2
|
|
194.8
|
204.0
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
12.4%
|
12.5%
|
|
1.0%
|
10.0%
|
19.2%
|
9.5%
|
|
(0.2%)
|
7.0%
|
Average allocated tangible equity (£bn)
|
27.4
|
27.7
|
|
26.6
|
25.7
|
24.8
|
25.1
|
|
24.9
|
24.7
|
Cost: income ratio
|
63%
|
59%
|
|
78%
|
61%
|
52%
|
63%
|
|
81%
|
73%
|
Loan loss rate (bps)
|
54
|
62
|
|
78
|
71
|
41
|
50
|
|
65
|
42
|
Net interest margin
|
4.07%
|
4.06%
|
|
3.91%
|
4.21%
|
3.92%
|
3.78%
|
|
3.79%
|
3.85%
|
Analysis of Barclays International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate and Investment Bank
|
Q217
|
Q117
|
|
Q416
|
Q316
|
Q216
|
Q116
|
|
Q415
|
Q315
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Analysis of total income
|
|
|
|
|
|
|
|
|
|
|
Credit
|
296
|
399
|
|
261
|
333
|
269
|
322
|
|
195
|
191
|
Equities
|
455
|
462
|
|
410
|
461
|
406
|
513
|
|
319
|
416
|
Macro
|
456
|
490
|
|
505
|
614
|
612
|
573
|
|
382
|
487
|
Markets
|
1,207
|
1,351
|
|
1,176
|
1,408
|
1,287
|
1,408
|
|
896
|
1,094
|
Banking fees
|
674
|
726
|
|
650
|
644
|
622
|
481
|
|
458
|
501
|
Corporate lending
|
278
|
269
|
|
303
|
284
|
312
|
296
|
|
312
|
377
|
Transactional banking
|
404
|
398
|
|
401
|
458
|
390
|
408
|
|
415
|
419
|
Banking
|
1,356
|
1,393
|
|
1,354
|
1,386
|
1,324
|
1,185
|
|
1,185
|
1,297
|
Other
|
1
|
38
|
|
1
|
1
|
-
|
3
|
|
16
|
(17)
|
Total income
|
2,564
|
2,782
|
|
2,531
|
2,795
|
2,611
|
2,596
|
|
2,097
|
2,374
|
Credit impairment releases/(charges) and other
provisions
|
1
|
(51)
|
|
(90)
|
(38)
|
(37)
|
(95)
|
|
(83)
|
(75)
|
Operating expenses
|
(1,756)
|
(1,941)
|
|
(2,287)
|
(1,872)
|
(1,665)
|
(1,800)
|
|
(1,962)
|
(1,940)
|
Other net income
|
116
|
-
|
|
1
|
-
|
-
|
-
|
|
-
|
(1)
|
Profit before tax
|
925
|
790
|
|
155
|
885
|
909
|
701
|
|
52
|
358
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Risk weighted assets
|
178.9
|
180.6
|
|
178.6
|
182.5
|
178.4
|
172.6
|
|
167.3
|
177.4
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
11.1%
|
8.2%
|
|
(1.2%)
|
9.2%
|
9.5%
|
7.3%
|
|
(2.5%)
|
4.5%
|
Average allocated tangible equity (£bn)
|
23.3
|
23.5
|
|
22.6
|
21.9
|
21.3
|
21.6
|
|
21.8
|
21.7
|
|
|
|
|
|
|
|
|
|
|
|
Consumer, Cards and Payments
|
|
|
|
|
|
|
|
|
|
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Total income
|
1,046
|
1,356
|
|
1,061
|
1,056
|
1,428
|
917
|
|
871
|
849
|
Credit impairment charges and other provisions
|
(280)
|
(295)
|
|
(336)
|
(382)
|
(203)
|
(174)
|
|
(219)
|
(160)
|
Operating expenses
|
(516)
|
(507)
|
|
(511)
|
(482)
|
(419)
|
(425)
|
|
(449)
|
(421)
|
Other net income
|
86
|
12
|
|
4
|
8
|
11
|
8
|
|
8
|
10
|
Profit before tax
|
336
|
566
|
|
218
|
200
|
817
|
326
|
|
210
|
278
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Loans and advances to banks and customers at amortised
cost
|
38.5
|
38.7
|
|
39.7
|
36.8
|
35.4
|
32.9
|
|
32.1
|
30.6
|
Customer deposits
|
57.3
|
57.6
|
|
50.0
|
48.3
|
46.9
|
44.2
|
|
41.8
|
39.8
|
Risk weighted assets
|
33.3
|
33.7
|
|
34.1
|
32.1
|
30.9
|
29.6
|
|
27.5
|
26.6
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Return on average allocated tangible equity
|
19.4%
|
36.4%
|
|
13.2%
|
14.8%
|
77.9%
|
23.4%
|
|
15.3%
|
24.7%
|
Average allocated tangible equity (£bn)
|
4.1
|
4.2
|
|
4.0
|
3.7
|
3.5
|
3.4
|
|
3.2
|
3.1
|
Head Office
|
|
|
|
|
|
|
|
|
|
|
|
Q217
|
Q117
|
|
Q416
|
Q316
|
Q216
|
Q116
|
|
Q415
|
Q315
|
Income statement information
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
Net interest income
|
108
|
(115)
|
|
29
|
(206)
|
14
|
(20)
|
|
(75)
|
(51)
|
Net fee, commission and other income
1
|
(24)
|
33
|
|
(38)
|
17
|
320
|
(13)
|
|
(210)
|
220
|
Total income
|
84
|
(82)
|
|
(9)
|
(189)
|
334
|
(33)
|
|
(285)
|
169
|
Credit impairment (charges)/releases and other
provisions
|
(1)
|
-
|
|
-
|
1
|
(2)
|
1
|
|
-
|
1
|
Net operating income/(expenses)
|
83
|
(82)
|
|
(9)
|
(188)
|
332
|
(32)
|
|
(285)
|
170
|
Operating expenses excluding UK bank levy and litigation and
conduct
|
(40)
|
(49)
|
|
15
|
(29)
|
(36)
|
(85)
|
|
(64)
|
(110)
|
UK bank levy
|
-
|
-
|
|
(2)
|
-
|
-
|
-
|
|
(8)
|
-
|
Litigation and conduct
|
(1)
|
(10)
|
|
(1)
|
(8)
|
(11)
|
(7)
|
|
(17)
|
(42)
|
Operating expenses
|
(41)
|
(59)
|
|
12
|
(37)
|
(47)
|
(92)
|
|
(89)
|
(152)
|
Other net (expenses)/income
|
(164)
|
-
|
|
159
|
(4)
|
(28)
|
1
|
|
(14)
|
2
|
(Loss)/profit before tax
|
(122)
|
(141)
|
|
162
|
(229)
|
257
|
(123)
|
|
(388)
|
20
|
Attributable (loss)/profit
|
(175)
|
(123)
|
|
223
|
(203)
|
182
|
(92)
|
|
(140)
|
(1)
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information
|
£bn
|
£bn
|
|
£bn
|
£bn
|
£bn
|
£bn
|
|
£bn
|
£bn
|
Total assets
|
17.3
|
74.5
|
|
75.2
|
73.3
|
87.7
|
63.4
|
|
59.4
|
61.8
|
Risk weighted assets
2
|
26.2
|
52.9
|
|
53.3
|
47.5
|
43.2
|
40.3
|
|
39.7
|
41.3
|
|
|
|
|
|
|
|
|
|
|
|
Performance measures
|
|
|
|
|
|
|
|
|
|
|
Average allocated tangible equity (£bn)
|
8.8
|
7.6
|
|
7.2
|
7.4
|
6.6
|
5.0
|
|
3.9
|
3.4
|
1
|
Following the early adoption of the own credit provisions of IFRS 9
on 1 January 2017, own credit, which was previously reported in Net
fee, commission and other income is now recognised within other
comprehensive income from Q117.
|
2
|
Includes Africa Banking RWAs.
|
Performance Management
Margins and balances
|
|
|
|
|
|
|
|
|
Half year ended 30.06.17
|
|
Half year ended 30.06.16
|
|
Net interest income
|
Average customer assets
|
Net interest margin
|
|
Net interest income
|
Average customer assets
|
Net interest margin
|
|
£m
|
£m
|
%
|
|
£m
|
£m
|
%
|
Barclays UK
|
3,045
|
166,200
|
3.69
|
|
2,977
|
166,944
|
3.59
|
Barclays International
1
|
2,185
|
108,486
|
4.06
|
|
2,016
|
103,934
|
3.90
|
Total Barclays UK and Barclays International
|
5,230
|
274,686
|
3.84
|
|
4,993
|
270,878
|
3.71
|
Other
2
|
(132)
|
|
|
|
225
|
|
|
Total net interest income
|
5,098
|
|
|
|
5,218
|
|
|
1
|
Barclays International margins include interest earning lending
balances within the investment banking business.
|
2
|
Other includes Head Office, Barclays Non-Core and non-lending
related investment banking balances.
|
Total
Barclays UK and Barclays International net interest income
increased 5% to £5,230m due to:
●
|
An
increase in average customer assets to £274.7bn (H116:
£270.9bn) predominantly driven by growth in Barclays
International
|
●
|
Net interest margin increased 13bps to 3.84% primarily driven by
higher margins on Personal Banking and Consumer, Cards and Payments
deposits, partially offset by lower asset margins. Group net
interest income decreased 2% to £5.1bn including net
structural hedge contributions of £0.7bn (H116:
£0.7bn)
|
Net
interest margin by business reflects movements in the Group’s
internal funding rates which are based on the cost to the Group of
alternative funding in wholesale markets. The internal funding rate
prices intra-group funding and liquidity to appropriately give
credit to businesses with net surplus liquidity and to charge those
businesses in need of alternative funding at a rate that is driven
by prevailing market rates and includes a term
premium.
Quarterly analysis for Barclays UK and Barclays
International
|
|
|
|
|
Three months ended 30.06.17
|
|
Net interest income
|
Average customer assets
|
Net interest margin
|
|
£m
|
£m
|
%
|
Barclays UK
|
1,534
|
166,345
|
3.70
|
Barclays International
1
|
1,064
|
104,899
|
4.07
|
Total Barclays UK and Barclays International
|
2,598
|
271,244
|
3.84
|
|
|
|
|
|
Three months ended 31.03.17
|
Barclays UK
|
1,511
|
166,065
|
3.69
|
Barclays International
1
|
1,121
|
112,060
|
4.06
|
Total Barclays UK and Barclays International
|
2,632
|
278,125
|
3.84
|
|
|
|
|
|
Three months ended 31.12.16
|
Barclays UK
|
1,502
|
167,935
|
3.56
|
Barclays International
1
|
1,110
|
112,936
|
3.91
|
Total Barclays UK and Barclays International
|
2,612
|
280,871
|
3.70
|
|
|
|
|
|
Three months ended 30.09.16
|
Barclays UK
|
1,569
|
167,713
|
3.72
|
Barclays International
1
|
1,149
|
108,571
|
4.21
|
Total Barclays UK and Barclays International
|
2,718
|
276,284
|
3.91
|
|
|
|
|
|
Three months ended 30.06.16
|
Barclays UK
|
1,476
|
166,891
|
3.56
|
Barclays International
1
|
1,021
|
104,707
|
3.92
|
Total Barclays UK and Barclays International
|
2,497
|
271,598
|
3.70
|
1
|
Barclays International margins include interest earning lending
balances within the investment banking business.
|
Risk Management
Risk management and principal risks
The
roles and responsibilities of the business groups, Risk and
Compliance, in the management of risk in the firm are defined in
the Enterprise Risk Management Framework. The purpose of the
framework is to identify the principal risks of the firm, the
process by which the firm 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; Conduct Risk; Reputation Risk; Model Risk; and
Legal Risk. Further detail on these risks and how they are managed
is available in the 2016 Annual Report or online at
home.barclays.com/annualreport. There have been no significant
changes to these principal risks in the period nor are any expected
for the remaining six months of the financial year.
The
following section gives an overview of Credit Risk, Market Risk and
Treasury and Capital Risk for the period.
Credit Risk
Analysis of loans and advances to customers and banks
|
|
|
|
|
|
|
Loans and advances at amortised cost net of impairment allowances,
by industry sector and geography
|
|
|
|
|
|
|
|
|
United Kingdom
|
Europe
|
Americas
|
Africa and Middle East
|
Asia
|
Total
|
As at 30.06.17
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Banks
|
7,337
|
14,454
|
9,256
|
2,183
|
3,878
|
37,108
|
Other financial institutions
|
28,590
|
20,985
|
41,978
|
401
|
5,027
|
96,981
|
Home loans
|
131,962
|
11,659
|
578
|
382
|
125
|
144,706
|
Cards, unsecured loans and other personal lending
|
29,082
|
4,263
|
20,541
|
372
|
93
|
54,351
|
Construction and property
|
21,613
|
1,014
|
1,546
|
133
|
122
|
24,428
|
Other
|
48,346
|
8,297
|
9,680
|
1,005
|
2,210
|
69,538
|
Net loans and advances to customers and banks
|
266,930
|
60,672
|
83,579
|
4,476
|
11,455
|
427,112
|
Impairment allowance
|
2,678
|
562
|
1,184
|
102
|
30
|
4,556
|
Gross loans and advances to customers and banks
|
269,608
|
61,234
|
84,763
|
4,578
|
11,485
|
431,668
|
|
|
|
|
|
|
|
Loans and advances at fair value
|
10,239
|
984
|
1,195
|
-
|
6
|
12,424
|
|
|
|
|
|
|
|
As at 31.12.16
|
|
|
|
|
|
|
Banks
|
7,458
|
12,674
|
16,894
|
1,778
|
4,447
|
43,251
|
Other financial institutions
|
22,209
|
19,800
|
45,189
|
425
|
4,189
|
91,812
|
Home loans
|
131,801
|
11,918
|
594
|
354
|
98
|
144,765
|
Cards, unsecured loans and other personal lending
|
29,606
|
4,003
|
22,513
|
493
|
114
|
56,729
|
Construction and property
|
21,276
|
1,042
|
1,669
|
89
|
125
|
24,201
|
Other
|
48,860
|
10,287
|
11,080
|
1,728
|
3,322
|
75,277
|
Net loans and advances to customers and banks
|
261,210
|
59,724
|
97,939
|
4,867
|
12,295
|
436,035
|
Impairment allowance
|
2,544
|
686
|
1,247
|
89
|
54
|
4,620
|
Gross loans and advances to customers and banks
|
263,754
|
60,410
|
99,186
|
4,956
|
12,349
|
440,655
|
|
|
|
|
|
|
|
Loans and advances at fair value
|
9,130
|
772
|
525
|
27
|
65
|
10,519
|
Analysis of retail and wholesale loans and advances and
impairment
|
|
|
|
Gross loans and advances
|
Impairment allowance
|
Loans and advances net of impairment
|
Credit
risk loans
|
CRLs % of gross loans and advances
|
Loan impairment
charges
1
|
Loan loss rates
|
As at 30.06.17
|
£m
|
£m
|
£m
|
£m
|
%
|
£m
|
bps
|
Barclays UK
|
155,040
|
1,585
|
153,455
|
1,980
|
1.3
|
380
|
49
|
Barclays International
|
30,801
|
1,505
|
29,296
|
1,247
|
4.0
|
578
|
378
|
Barclays Core
|
185,841
|
3,090
|
182,751
|
3,227
|
1.7
|
958
|
104
|
Barclays Non-Core
|
9,804
|
285
|
9,519
|
716
|
7.3
|
30
|
62
|
Total Group retail
|
195,645
|
3,375
|
192,270
|
3,943
|
2.0
|
988
|
102
|
|
|
|
|
|
|
|
|
Barclays UK
|
15,126
|
307
|
14,819
|
616
|
4.1
|
19
|
25
|
Barclays International
|
176,233
|
718
|
175,515
|
1,227
|
0.7
|
46
|
5
|
Head Office
|
5,702
|
-
|
5,702
|
-
|
-
|
-
|
-
|
Barclays Core
|
197,061
|
1,025
|
196,036
|
1,843
|
0.9
|
65
|
7
|
Barclays Non-Core
|
38,962
|
156
|
38,806
|
273
|
0.7
|
(1)
|
(1)
|
Total Group wholesale
|
236,023
|
1,181
|
234,842
|
2,116
|
0.9
|
64
|
5
|
|
|
|
|
|
|
|
|
Total loans and advances at amortised cost
|
431,668
|
4,556
|
427,112
|
6,059
|
1.4
|
1,052
|
49
|
|
|
|
|
|
|
|
|
Traded loans
|
3,942
|
n/a
|
3,942
|
n/a
|
|
|
|
Loans and advances designated at fair value
|
12,424
|
n/a
|
12,424
|
n/a
|
|
|
|
Loans and advances held at fair value
|
16,366
|
n/a
|
16,366
|
n/a
|
|
|
|
|
|
|
|
|
|
|
|
Total loans and advances
|
448,034
|
4,556
|
443,478
|
6,059
|
|
|
|
|
|
|
|
|
|
|
|
As at 31.12.16
|
|
|
|
|
|
|
|
Barclays UK
|
155,729
|
1,519
|
154,210
|
2,044
|
1.3
|
866
|
56
|
Barclays International
|
33,485
|
1,492
|
31,993
|
1,249
|
3.7
|
1,085
|
324
|
Barclays Core
|
189,214
|
3,011
|
186,203
|
3,293
|
1.7
|
1,951
|
103
|
Barclays Non-Core
|
10,319
|
385
|
9,934
|
838
|
8.1
|
102
|
99
|
Total Group retail
|
199,533
|
3,396
|
196,137
|
4,131
|
2.1
|
2,053
|
103
|
|
|
|
|
|
|
|
|
Barclays UK
|
15,204
|
282
|
14,922
|
591
|
3.9
|
30
|
20
|
Barclays International
|
180,102
|
748
|
179,354
|
1,470
|
0.8
|
258
|
14
|
Head Office
|
4,410
|
-
|
4,410
|
-
|
-
|
-
|
-
|
Barclays Core
|
199,716
|
1,030
|
198,686
|
2,061
|
1.0
|
288
|
14
|
Barclays Non-Core
|
41,406
|
194
|
41,212
|
299
|
0.7
|
11
|
3
|
Total Group wholesale
|
241,122
|
1,224
|
239,898
|
2,360
|
1.0
|
299
|
12
|
|
|
|
|
|
|
|
|
Total loans and advances at amortised cost
|
440,655
|
4,620
|
436,035
|
6,491
|
1.5
|
2,352
|
53
|
|
|
|
|
|
|
|
|
Traded loans
|
2,975
|
n/a
|
2,975
|
n/a
|
|
|
|
Loans and advances designated at fair value
|
10,519
|
n/a
|
10,519
|
n/a
|
|
|
|
Loans and advances held at fair value
|
13,494
|
n/a
|
13,494
|
n/a
|
|
|
|
|
|
|
|
|
|
|
|
Total loans and advances
|
454,149
|
4,620
|
449,529
|
6,491
|
|
|
|
1
|
Excluding impairment charges on available for sale investments and
reverse repurchase agreements. H117 impairment charges represent 6
months charge, whereas December 2016 impairment charges represent
12 months charge.
|
Total
loans and advances decreased £6bn to £448bn driven by a
decrease in lending to banks and customers, partially offset by an
increase in net settlement and cash collateral
balances.
Credit
risk loans (CRLs) and the ratio of CRLs to gross loans and advances
decreased £0.4bn to £6.1bn and 0.1% to 1.4%
respectively.
Analysis of forbearance programmes
|
Balances
|
|
Impairment allowance
|
|
Allowance coverage
|
|
As at
|
As at
|
|
As at
|
As at
|
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
|
30.06.17
|
31.12.16
|
|
30.06.17
|
31.12.16
|
|
£m
|
£m
|
|
£m
|
£m
|
|
%
|
%
|
Barclays UK
|
841
|
926
|
|
197
|
237
|
|
23.4
|
25.6
|
Barclays International
|
218
|
243
|
|
84
|
57
|
|
38.5
|
23.5
|
Barclays Core
|
1,059
|
1,169
|
|
281
|
294
|
|
26.5
|
25.1
|
Barclays Non-Core
|
201
|
211
|
|
11
|
9
|
|
5.5
|
4.3
|
Total retail
|
1,260
|
1,380
|
|
292
|
303
|
|
23.2
|
22.0
|
|
|
|
|
|
|
|
|
|
Barclays UK
|
590
|
589
|
|
57
|
62
|
|
9.7
|
10.5
|
Barclays International
|
2,399
|
2,044
|
|
300
|
257
|
|
12.5
|
12.6
|
Barclays Core
|
2,989
|
2,633
|
|
357
|
319
|
|
11.9
|
12.1
|
Barclays Non-Core
|
201
|
269
|
|
54
|
50
|
|
26.9
|
18.5
|
Total wholesale
|
3,190
|
2,902
|
|
411
|
369
|
|
12.9
|
12.7
|
|
|
|
|
|
|
|
|
|
Group total
|
4,450
|
4,282
|
|
703
|
672
|
|
15.8
|
15.7
|
Retail
balances decreased 9% to £1.3bn primarily due to continued
improvement in the residential mortgage and Barclaycard portfolios
within Barclays UK.
●
|
Barclays UK
: Forbearance
balances decreased 9% to £841m following a continued
improvement in mortgage and card portfolios driven by the benign
economic environment
|
●
|
Barclays International
:
Balances decreased primarily in US cards due to stricter
forbearance criteria whereas impairment allowance increased as a
result of a strengthened impairment methodology
|
Wholesale
balances increased 10% to £3.2bn primarily due to an increase
in forborne balances in Barclays International slightly offset by a
reduction in Barclays Non-Core portfolios.
●
|
Barclays UK:
Forbearance
balances remained stable at £590m (December 2016 :
£589m)
|
●
|
Barclays International:
Balances increased £355m to £2.4bn as
consistent forbearance methodologies were introduced across
CIB
|
Analysis of specific portfolios and asset types
Secured home loans
The UK
home loan portfolio primarily comprises first lien mortgages and
accounts for 99%
1
(2016: 98%) of total
home loans in the Group’s retail core
portfolios.
Home loans principal
portfolios
2
|
|
|
|
Barclays UK
|
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
Gross loans and advances (£m)
|
128,966
|
129,136
|
>90 day arrears, excluding recovery book (%)
|
0.2
|
0.2
|
Non-performing proportion of outstanding balances (%)
|
0.5
|
0.6
|
Annualised gross charge-off rates (%)
|
0.2
|
0.3
|
Recovery book proportion of outstanding balances (%)
|
0.3
|
0.4
|
Recovery book impairment coverage ratio (%)
|
9.8
|
9.1
|
1
|
Remaining balance represents Wealth portfolio.
|
2
|
Gross loans and advances include loans and advances to customers
and banks. Risk metrics based on exposures to customers
only.
|
Barclays UK
: Arrears and charge-off rates remained stable
reflecting the continuing low base rate environment. The recovery
book impairment coverage ratio increased as a result of a reduction
in the recovery book without a corresponding release in the
impairment provision. Balance weighted LTV reduced to 47.4% (2016:
47.7%) as average house prices increased. This increase also
contributed to a 4% reduction in home loans with LTV >100% to
£229m (2016: £239m)
Within
the UK home loans portfolio:
|
●
|
Owner-occupied interest-only home loans comprised 29.5% (2016:
30.8%) of total balances. The average balance weighted LTV on these
loans reduced to 40.7% (2016: 41.7%) as house prices improved
across core regions and >90 day arrears was stable at 0.2%
(2016: 0.2%)
|
|
●
|
Buy-to-let (BTL) home loans comprised 9.8% (2016: 9.1%) of total
balances with the increase driven by strong performance in this
segment. The average balance weighted LTV increased marginally to
52.9% (2016: 52.6%) while the >90 day arrears remained stable at
0.1% (2016: 0.1%)
|
Home loans principal portfolios-distribution of balances by
LTV
1
|
|
Distribution of balances
|
|
Impairment coverage ratio
|
|
Non-performing proportion of outstanding balances
|
|
Non-performing balances impairment coverage ratio
|
|
Recovery book proportion of outstanding balances
|
|
Recovery book impairment coverage ratio
|
As at
|
30.06.17
|
31.12.16
|
|
30.06.17
|
31.12.16
|
|
30.06.17
|
31.12.16
|
|
30.06.17
|
31.12.16
|
|
30.06.17
|
31.12.16
|
|
30.06.17
|
31.12.16
|
Barclays UK
|
%
|
%
|
|
%
|
%
|
|
%
|
%
|
|
%
|
%
|
|
%
|
%
|
|
%
|
%
|
<=75%
|
91.5
|
91.8
|
|
0.1
|
0.1
|
|
0.5
|
0.6
|
|
4.0
|
4.2
|
|
0.3
|
0.4
|
|
6.1
|
5.9
|
>75%
and <=80%
|
4.0
|
3.5
|
|
0.2
|
0.2
|
|
0.6
|
0.6
|
|
16.9
|
17.1
|
|
0.4
|
0.4
|
|
23.2
|
22.1
|
>80%
and <=85%
|
2.3
|
2.1
|
|
0.2
|
0.2
|
|
0.6
|
0.8
|
|
15.8
|
20.4
|
|
0.4
|
0.6
|
|
20.3
|
25.0
|
>85%
and <=90%
|
1.2
|
1.3
|
|
0.3
|
0.3
|
|
0.7
|
0.7
|
|
25.4
|
23.0
|
|
0.5
|
0.6
|
|
32.6
|
25.4
|
>90%
and <=95%
|
0.6
|
0.8
|
|
0.4
|
0.4
|
|
1.0
|
1.1
|
|
30.8
|
28.3
|
|
0.8
|
0.8
|
|
35.1
|
33.7
|
>95%
and <=100%
|
0.2
|
0.3
|
|
1.0
|
0.7
|
|
2.6
|
1.9
|
|
29.7
|
23.4
|
|
1.9
|
1.5
|
|
36.5
|
27.0
|
>100%
|
0.2
|
0.2
|
|
3.7
|
3.1
|
|
6.5
|
5.7
|
|
41.0
|
38.6
|
|
5.5
|
5.0
|
|
45.6
|
40.9
|
1
|
Portfolio marked to market based on the most updated valuation
including recovery book balances. Updated valuations reflect the
application of the latest house price index available as at 30 June
2017.
|
Home loans principal portfolios - average LTV
|
|
|
|
Barclays UK
|
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
Portfolio marked to market LTV:
|
|
|
Balance weighted (%)
|
47.4
|
47.7
|
Valuation weighted (%)
|
35.2
|
35.6
|
For > 100% LTVs:
|
|
|
Balances (£m)
|
229
|
239
|
Marked to market collateral (£m)
|
203
|
210
|
Average LTV: balance weighted (%)
|
124.8
|
118.4
|
Average LTV: valuation weighted (%)
|
117.6
|
113.1
|
% of balances in recovery book
|
5.5
|
5.0
|
Home loans principal portfolios - new lending
|
|
|
|
Barclays UK
|
|
Half year
|
Half year
|
|
ended
|
ended
|
|
30.06.17
|
30.06.16
|
New home loan bookings (£m)
|
10,025
|
9,990
|
New home loans proportion above 85% LTV (%)
|
4.7
|
8.7
|
Average LTV on new home loans: balance weighted (%)
|
62.4
|
63.2
|
Average LTV on new home loans: valuation weighted (%)
|
54.6
|
54.8
|
Barclays UK:
New lending remained stable at £10.0bn
(H116: £10.0bn). The decrease in mortgages with LTV > 85%
to 4.7% (H116 8.7%) reflects an increased focus on remortgage
business, which is typically lower LTV, and the closure of the Help
to Buy 2 scheme that supported owner occupied home purchase loans
where maximum LTV was 95%.
Credit cards and unsecured loans
The
principal portfolios listed below accounted for 92% (2016: 94%) of
the Group’s total credit cards and unsecured
loans.
Principal portfolios
|
Gross loans and
advances
1
|
30 day
arrears, excluding recovery book
|
90 day
arrears, excluding recovery book
|
Annualised gross
charge-off
rates
|
Recovery book
proportion of
outstanding balances
|
Recovery book impairment coverage ratio
|
As at 30.06.17
|
£m
|
%
|
%
|
%
|
%
|
%
|
Barclays UK
|
|
|
|
|
|
|
UK cards
2
|
17,528
|
2.0
|
0.9
|
5.0
|
3.7
|
83.6
|
UK personal loans
|
6,254
|
2.2
|
1.0
|
3.5
|
4.7
|
78.6
|
Barclays International
|
|
|
|
|
|
|
US cards
2
|
21,413
|
2.2
|
1.1
|
5.3
|
2.9
|
84.4
|
Barclays Partner Finance
|
3,857
|
1.4
|
0.5
|
2.7
|
2.4
|
81.0
|
Germany cards
|
1,912
|
2.9
|
1.1
|
3.7
|
2.7
|
79.8
|
|
|
|
|
|
|
|
As at 31.12.16
|
|
|
|
|
|
|
Barclays UK
|
|
|
|
|
|
|
UK cards
2
|
17,833
|
1.9
|
0.9
|
5.5
|
3.0
|
83.8
|
UK personal loans
|
6,076
|
2.1
|
0.9
|
3.1
|
4.7
|
77.2
|
Barclays International
|
|
|
|
|
|
|
US cards
2
|
23,915
|
2.6
|
1.3
|
4.5
|
2.4
|
83.6
|
Barclays Partner Finance
|
4,041
|
1.5
|
0.6
|
2.5
|
2.6
|
81.5
|
Germany cards
|
1,812
|
2.6
|
1.0
|
3.7
|
2.7
|
79.0
|
1
|
Gross loans and advances include loans and advances to customers
and banks. Risk metrics based on exposures to
customers.
|
2
|
For UK and US cards, outstanding recovery book balances for
acquired portfolios recognised at fair value (which have no related
impairment allowance) have been excluded from the recovery book
impairment coverage ratio. Losses have been recognised where
related to additional spend from acquired accounts in the period
post acquisition.
|
UK cards
: In 2017, both early and late
stage arrears remained broadly stable. Charge-off rates reduced in
the first half of 2017 following the non-recurrence of one-off
accelerated charge-offs. However, recovery book proportion of
outstanding balances was higher due to accelerated charge-off of
certain forbearance plans since the beginning of the
year.
US cards
: Arrears rates improved
principally due to a one-off portfolio sale. The higher charge-off
rate is a result of accelerating the timeframe in which settlements
and bankrupt clients are charged off to align with US industry
standards. The increase in impairment coverage ratio for recovery
book was due to a model enhancement providing a more accurate
representation of future recovery expectations.
Market Risk
Analysis of management VaR
●
|
The
table below shows the total management VaR on a diversified basis
by risk factor. Total management VaR includes all trading positions
in CIB, Non-Core and Head Office and it is calculated with one day
holding period
|
●
|
Limits
are applied against each risk factor VaR as well as total
Management VaR, which are then cascaded further by risk managers to
each business
|
Management VaR (95%) by asset
class
1
|
|
|
|
|
|
|
|
|
|
Half year ended
|
30.06.17
|
|
31.12.16
|
|
30.06.16
|
|
Average
|
High
2
|
Low
2
|
|
Average
|
High
2
|
Low
2
|
|
Average
|
High
2
|
Low
2
|
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
Credit risk
|
13
|
18
|
10
|
|
16
|
24
|
13
|
|
15
|
23
|
9
|
Interest rate risk
|
7
|
15
|
4
|
|
8
|
13
|
5
|
|
6
|
10
|
4
|
Equity risk
|
8
|
14
|
4
|
|
7
|
11
|
4
|
|
6
|
10
|
4
|
Basis risk
|
5
|
6
|
4
|
|
6
|
9
|
5
|
|
5
|
6
|
3
|
Spread risk
|
4
|
6
|
3
|
|
4
|
5
|
3
|
|
3
|
5
|
2
|
Foreign exchange risk
|
3
|
5
|
2
|
|
3
|
5
|
2
|
|
3
|
4
|
2
|
Commodity risk
|
2
|
3
|
1
|
|
2
|
3
|
2
|
|
2
|
4
|
1
|
Inflation risk
|
2
|
4
|
1
|
|
2
|
3
|
2
|
|
2
|
3
|
2
|
Diversification effect
|
(24)
|
-
|
-
|
|
(26)
|
-
|
-
|
|
(22)
|
-
|
-
|
Total management VaR
|
20
|
26
|
17
|
|
22
|
29
|
15
|
|
20
|
29
|
13
|
1
|
Including BAGL.
|
2
|
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
total management VaR decreased 9% to £20m. Credit Risk VaR
reduced by 19% to £13m primarily driven by reduction in
counterparty risk trading as Barclays CDS spread tightened and a
decrease in loan commitment hedging.
Treasury and Capital Risk
The Group has a comprehensive Key Risk Control Framework for
managing the Group’s liquidity risk. The Liquidity Framework
meets the PRA’s standards and is designed to ensure the Group
maintains liquidity resources that are sufficient in amount and
quality, and a funding profile that is appropriate to meet the
liquidity risk appetite. The Liquidity Framework is delivered via a
combination of policy formation, review and governance, analysis,
stress testing, limit setting and monitoring.
Funding and liquidity
Whilst
Barclays has a comprehensive framework for managing the
Group’s liquidity risks, liquidity risk is managed separately
at Barclays Africa Group Limited (BAGL) due to local currency and
funding requirements. All liquidity related disclosures treat BAGL
on a fully deconsolidated basis.
Liquidity stress testing
Barclays
manages the Group’s liquidity position against the
Group’s internally defined Liquidity Risk Appetite (LRA) and
regulatory metrics such as CRD IV Liquidity Coverage Ratio (LCR).
As at June 2017, the Group held eligible liquid assets well in
excess of 100% of net stress outflows for both the 30 day
Barclays-specific LRA and the LCR.
Compliance with internal and regulatory stress tests
|
Barclays' LRA (30 day Barclays
specific requirement)
1
|
CRD IV
LCR
2
|
|
£bn
|
£bn
|
Eligible liquidity buffer
|
201
|
199
|
Net stress outflows
|
(129)
|
(134)
|
Surplus
|
71
|
65
|
|
|
|
Liquidity pool as a percentage of anticipated net outflows as at 30
June 2017
|
155%
|
149%
|
Liquidity pool as a percentage of anticipated net outflows as at 31
December 2016
|
120%
|
131%
|
1
|
Of the three stress scenarios monitored as part of the LRA, the 30
day Barclays specific scenario results in the lowest ratio at 155%
(December 2016: 120%). This compares to 177% (December 2016: 134%)
under the 90 day market-wide scenario and 190% (December 2016:
144%) under the 30 day combined scenario.
|
Barclays
manages the Group’s liquidity position against the
Group’s internally defined Liquidity Risk Appetite (LRA) and
regulatory metrics, such as CRD IV Liquidity Coverage Ratio (LCR).
As at 30 June 2017, the Group held eligible liquid assets
significantly in excess of 100% of net stress outflows for both the
30 day Barclays-specific LRA and the LCR.
LRA
buffer duration as of 30 June 2017 was observed at in excess of 90
days (December 2016: in excess of 90 days).
Composition of the Group liquidity pool
|
|
|
Liquidity pool
|
Liquidity pool of which interim CRD IV LCR-eligible
|
Liquidity pool
|
|
|
30.06.17
|
Cash
|
Level 1
|
Level 2A
|
31.12.16
|
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Cash and deposits with central
banks
1
|
|
146
|
141
|
-
|
-
|
103
|
|
|
|
|
|
|
|
Government bonds
|
|
|
|
|
|
|
AAA to AA-
|
|
39
|
-
|
39
|
-
|
34
|
A+ to A-
|
|
-
|
-
|
-
|
-
|
3
|
BBB+ to BBB-
|
|
1
|
-
|
1
|
-
|
1
|
Other LCR Ineligible government bonds
|
|
-
|
-
|
-
|
-
|
1
|
Total government bonds
|
|
40
|
-
|
40
|
-
|
39
|
|
|
|
|
|
|
|
Other
|
|
|
|
|
|
|
Government Guaranteed Issuers, PSEs and GSEs
|
|
8
|
-
|
7
|
1
|
12
|
International Organisations and MDBs
|
|
5
|
-
|
5
|
-
|
6
|
Covered bonds
|
|
1
|
-
|
1
|
-
|
1
|
Other
|
|
1
|
-
|
-
|
-
|
4
|
Total other
|
|
15
|
-
|
13
|
1
|
23
|
|
|
|
|
|
|
|
Total as at 30 June 2017
|
|
201
|
141
|
53
|
1
|
|
Total as at 31 December 2016
|
|
165
|
101
|
55
|
3
|
|
1
|
Of which over 98% (December 2016: over 98%) was placed with the
Bank of England, US Federal Reserve, European Central Bank, Bank of
Japan and Swiss National Bank.
|
Barclays
manages the liquidity pool on a centralised basis. The liquidity
pool is held unencumbered and is not used to support payment or
clearing requirements. As at 30 June 2017, 94% (December 2016: 91%)
of the liquidity pool was located in Barclays Bank PLC and was
available to meet liquidity needs across the Barclays Group. The
residual liquidity pool is held predominantly within Barclays
Capital Inc. The portion of the liquidity pool outside of Barclays
Bank PLC is held primarily against entity-specific stressed
outflows and regulatory requirements.
Deposit funding
|
|
|
|
|
|
|
As at 30.06.17
|
|
As at 31.12.16
|
Funding of loans and advances to customers
|
Loans and advances to customers
|
Customer deposits
|
Loan to deposit ratio
|
|
Loan to deposit ratio
|
|
£bn
|
£bn
|
%
|
|
%
|
Barclays UK
|
167
|
187
|
|
|
|
Barclays International
1
|
94
|
159
|
|
|
|
Non-Core
1
|
20
|
-
|
|
|
|
Total retail and corporate
funding
1
|
281
|
346
|
81%
|
|
83%
|
|
|
|
|
|
|
Barclays International and Head Office
2
|
109
|
91
|
|
|
|
Total
|
390
|
437
|
89%
|
|
93%
|
1
|
Excluding the investment banking businesses.
|
2
|
Including the investment banking businesses.
|
Barclays
UK and Barclays International (excluding the investment banking
balances) are largely funded by customer deposits. The loan to
deposit ratio for these businesses was 81% (December 2016:
83%).
The
loan to deposit ratio for the Group was 89% (December 2016:
93%).
Wholesale funding
Funding of other assets as at 30 June 2017
|
Assets
|
£bn
|
|
Liabilities
|
£bn
|
Trading portfolio assets
|
56
|
|
Repurchase agreements
|
121
|
Reverse repurchase agreements
|
65
|
|
|
|
|
|
|
|
|
Reverse repurchase agreements
|
40
|
|
Trading portfolio liabilities
|
40
|
|
|
|
|
|
Derivative financial instruments
|
260
|
|
Derivative financial instruments
|
261
|
|
|
|
|
|
Liquidity pool
1
|
136
|
|
Less than 1 year wholesale debt
|
72
|
Other assets
2
|
95
|
|
Greater than 1 year wholesale debt and equity
|
158
|
1
|
The portion of the liquidity pool estimated to be funded by
wholesale funds.
|
2
|
Predominantly available for sale investments, trading portfolio
assets, financial assets designated at fair value and loans and
advances to banks.
|
Repurchase
agreements fund reverse repurchase agreements and trading portfolio
assets. Trading portfolio liabilities are settled by the remainder
of reverse repurchase agreements.
Derivative
liabilities and assets are largely matched. A substantial
proportion of balance sheet derivative positions qualify for
counterparty netting and the remaining portions are largely offset
once netted against cash collateral received and paid.
Wholesale debt,
along with the surplus of customer deposits to loans and advances
to customers, is used to fund the liquidity pool. Term wholesale
debt and equity largely fund other assets.
Composition of wholesale
funding
1
As the
Group progresses to a Single Point of Entry resolution model,
Barclays continues to issue debt capital and term senior unsecured
funding from Barclays PLC, the holding company, replacing maturing
debt in Barclays Bank PLC.
Maturity profile of wholesale funding
|
|
|
|
|
|
|
|
|
<1
month
|
1-3 months
|
3-6 months
|
6-12 months
|
<1
year
|
1-2 years
|
2-3 years
|
3-4 years
|
4-5 years
|
>5
years
|
Total
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Barclays PLC
|
|
|
|
|
|
|
|
|
|
|
|
Senior unsecured (public benchmark)
|
-
|
-
|
-
|
0.8
|
0.8
|
0.1
|
2.3
|
2.8
|
4.5
|
9.9
|
20.4
|
Senior unsecured (privately placed)
|
-
|
-
|
-
|
-
|
-
|
0.1
|
-
|
0.1
|
0.1
|
0.5
|
0.8
|
Subordinated liabilities
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
1.1
|
-
|
4.2
|
5.3
|
Barclays Bank PLC
|
|
|
|
|
|
|
|
|
|
|
|
Deposits from banks
|
10.6
|
5.6
|
1.0
|
0.8
|
18.0
|
0.1
|
-
|
0.2
|
-
|
-
|
18.3
|
Certificates of deposit and commercial paper
|
0.6
|
6.4
|
10.4
|
8.5
|
25.9
|
0.7
|
0.9
|
0.5
|
0.4
|
0.1
|
28.5
|
Asset backed commercial paper
|
2.7
|
3.4
|
1.4
|
0.2
|
7.7
|
-
|
-
|
-
|
-
|
-
|
7.7
|
Senior unsecured (public benchmark)
|
-
|
-
|
-
|
-
|
-
|
1.4
|
1.9
|
0.6
|
0.1
|
1.1
|
5.1
|
Senior unsecured (privately placed)
2
|
1.0
|
1.6
|
1.7
|
5.2
|
9.5
|
7.8
|
5.8
|
2.0
|
2.3
|
12.1
|
39.5
|
Covered bonds
|
-
|
1.5
|
-
|
1.0
|
2.5
|
-
|
2.8
|
1.0
|
2.4
|
1.3
|
10.0
|
Asset backed securities
|
-
|
-
|
0.6
|
0.7
|
1.3
|
0.6
|
2.3
|
-
|
0.1
|
1.3
|
5.6
|
Subordinated liabilities
|
-
|
-
|
1.2
|
3.1
|
4.3
|
-
|
-
|
5.9
|
1.4
|
7.0
|
18.6
|
Other
3
|
1.3
|
0.5
|
0.1
|
0.3
|
2.2
|
0.2
|
0.1
|
0.2
|
-
|
0.5
|
3.2
|
Total as at 30 June 2017
|
16.2
|
19.0
|
16.4
|
20.6
|
72.2
|
11.0
|
16.1
|
14.4
|
11.3
|
38.0
|
163.0
|
Of which secured
|
2.7
|
4.9
|
2.0
|
2.0
|
11.6
|
0.6
|
5.1
|
1.0
|
2.5
|
2.6
|
23.4
|
Of which unsecured
|
13.5
|
14.1
|
14.4
|
18.6
|
60.6
|
10.4
|
11.0
|
13.4
|
8.8
|
35.4
|
139.6
|
Total as at 31 December 2016
|
16.6
|
17.3
|
16.4
|
20.0
|
70.3
|
14.3
|
14.4
|
8.6
|
14.1
|
36.1
|
157.8
|
Of which secured
|
3.7
|
5.6
|
3.4
|
2.3
|
15.0
|
1.8
|
3.2
|
0.4
|
1.0
|
4.4
|
25.8
|
Of which unsecured
|
12.9
|
11.7
|
13.0
|
17.7
|
55.3
|
12.5
|
11.2
|
8.2
|
13.1
|
31.7
|
132.0
|
1
|
The composition of wholesale funds comprises the balance sheet
reported Deposits from Banks, Financial liabilities at Fair Value,
Debt Securities in Issue and Subordinated Liabilities, excluding
cash collateral and settlement balances. It does not include
participation in the Bank of England’s Term Funding
Scheme.
|
2
|
Includes structured notes of £30.1bn, £8.2bn of which
matures within one year.
|
3
|
Primarily comprised of fair value deposits £2.1bn and secured
financing of physical gold £0.3bn.
|
Outstanding
wholesale funding includes £40.3bn (December 2016:
£37.6bn) of privately placed senior unsecured notes in issue.
These notes are issued through a variety of distribution channels
including intermediaries and private banks. Although not a
requirement, the liquidity pool exceeded wholesale funding maturing
in less than one year by £128.8bn (December 2016:
£94.7bn).
Term financing
The
Group issued £7.6bn equivalent of capital and term senior
unsecured debt from Barclays PLC (HoldCo) of which £4.8bn was
in public senior unsecured debt and £2.8bn was in capital
instruments. In the same period, £4.7bn of Barclays Bank PLC
(OpCo) capital and senior public term instruments either matured or
were redeemed, including the $1.375bn 7.1% Series 3 USD preference
shares.
In
addition, Barclays has £8.6bn of term funding maturing in the
remainder of 2017 and £11.2bn in 2018.
The
Group expects to continue issuing public wholesale debt in 2017
from Barclays PLC, in order to ensure compliance with new
prospective loss absorbency requirements and maintain a stable and
diverse funding base by type, currency and distribution
channel.
Credit ratings
In
addition to monitoring and managing key metrics related to the
financial strength of the Group, Barclays also solicits independent
credit ratings by Standard & Poor’s (S&P),
Moody’s, Fitch and Rating and Investment Information
(R&I). These ratings assess the creditworthiness of the Group,
its subsidiaries and branches, and are based on reviews of a broad
range of business and financial attributes including risk
management processes and procedures, capital strength, earnings,
funding, asset quality, liquidity, accounting and
governance.
Barclays Bank PLC
|
Standard & Poor's
|
Moody's
|
Fitch
|
Long-term
|
A- (Negative)
|
A1 (Negative)
|
A (Stable)
|
Short-term
|
A-2
|
P-1
|
F1
|
Standalone rating
1
|
bbb+
|
baa2
|
a
|
|
|
|
|
Barclays PLC
|
Standard & Poor's
|
Moody's
|
Fitch
|
Long-term
|
BBB (Negative)
|
Baa2 (Negative)
|
A (Stable)
|
Short-term
|
A-2
|
P-3
|
F1
|
1
|
Refers to Standard & Poor’s Stand-Alone Credit Profile
(SACP), Moody’s Baseline Credit Assessment (BCA) and
Fitch’s Viability Rating (VR).
|
As at 30 June 2017, all solicited ratings with all agencies
remained unchanged since 31 December 2016. S&P affirmed
Barclays’ ratings in May 2017 as part of their periodic
review.
Barclays’ ratings outlooks for Moody’s and S&P
remain negative following the outcome of the EU referendum in June
2016, which were part of a wider review which saw the two agencies
place several UK banks on negative outlooks whilst affirming the
ratings. The ratings continue to carry a stable outlook with
Fitch.
Barclays also solicits issuer ratings from R&I for local
issuances purposes in Japan and the ratings of A for Barclays Bank
PLC and A- for Barclays PLC and were affirmed in July 2017 with
stable outlooks.
CRD IV capital
Barclays’
current regulatory requirement is to meet a fully loaded CET1 ratio
comprising the required 4.5% Pillar 1 minimum CET1 requirement and,
phased in from 2016, a Combined Buffer Requirement. This currently
comprises a Capital Conservation Buffer (CCB) and a Global
Systemically Important Institution (G-SII) buffer determined by the
PRA in line with guidance from the Financial Stability Board (FSB).
Both buffers are subject to phased implementation at 25% per annum
from 2016 with full effect from 2019. The CCB has been set at 2.5%
with 1.25% applicable for 2017. The G-SII buffer for 2017 has been
set at 2% with 1% applicable for 2017. On 21 November 2016 the FSB
confirmed that the G-SII buffer for 2018 will be 1.5% with 1.1%
applicable for 2018.
The
Combined Buffer Requirement also includes a Counter-Cyclical
Capital Buffer (CCyB) and a Systemic Risk Buffer (SRB). On 27 June
2017 the Financial Policy Committee (FPC) increased the UK CCyB
rate from 0% to 0.5% applicable from 27 June 2018. Other national
authorities also determine the appropriate CCyBs that should be
applied to exposures in their jurisdiction. CCyBs have started to
apply for Barclays’ exposures to other jurisdictions; however
based on current exposures these are not material. No SRB has been
set to date.
In
addition, Barclays’ Pillar 2A requirement as per the
PRA’s Individual Capital Guidance (ICG) for 2017 based on a
point in time assessment is 4.2% of which 56% needs to be met in
CET1 form, equating to approximately 2.3% of RWAs. The Pillar 2A
requirement is subject to at least annual review.
For
regulatory reporting purposes, BAGL is treated on a proportional
consolidated basis based on a Barclays’ holding in BAGL of
23.4%.
As at
30 June 2017 Barclays’ CET1 ratio was 13.1% which exceeds the
2017 transitional minimum requirement of 9.1% including the minimum
4.5% CET1 ratio requirement, 2.3% of Pillar 2A, a 1.25% CCB buffer,
a 1% G-SII buffer and a 0% CCyB.
Capital ratios
|
As at
|
As at
|
As at
|
30.06.17
|
31.03.17
|
31.12.16
|
Fully loaded CET1
1,2
|
13.1%
|
12.5%
|
12.4%
|
PRA Transitional Tier 1
3,4
|
16.6%
|
15.8%
|
15.6%
|
PRA Transitional Total Capital
3,4
|
20.7%
|
19.6%
|
19.6%
|
|
|
|
|
Capital resources
|
£m
|
£m
|
£m
|
Shareholders' equity (excluding non-controlling interests) per the
balance sheet
|
63,866
|
65,536
|
64,873
|
Less: other equity instruments (recognised as AT1
capital)
|
(7,694)
|
(7,690)
|
(6,449)
|
Adjustment to retained earnings for foreseeable
dividends
|
(303)
|
(519)
|
(388)
|
|
|
|
|
Minority interests (amount allowed in consolidated
CET1)
|
-
|
1,864
|
1,825
|
|
|
|
|
Other regulatory adjustments and deductions:
|
|
|
|
Additional value adjustments (PVA)
|
(1,494)
|
(1,618)
|
(1,571)
|
Goodwill and intangible assets
|
(7,756)
|
(8,142)
|
(9,054)
|
Deferred tax assets that rely on future profitability excluding
temporary differences
|
(346)
|
(421)
|
(494)
|
Fair value reserves related to gains or losses on cash flow
hedges
|
(1,576)
|
(1,956)
|
(2,104)
|
Excess of expected losses over impairment
|
(1,179)
|
(1,286)
|
(1,294)
|
Gains or losses on liabilities at fair value resulting from own
credit
|
58
|
(28)
|
86
|
Defined-benefit pension fund assets
|
(542)
|
(753)
|
(38)
|
Direct and indirect holdings by an institution of own CET1
instruments
|
(50)
|
(50)
|
(50)
|
Deferred tax assets arising from temporary differences (amount
above 10% threshold)
|
(115)
|
(39)
|
(183)
|
Other regulatory adjustments
|
(35)
|
40
|
45
|
Fully loaded CET1 capital
|
42,834
|
44,938
|
45,204
|
|
|
|
|
Additional Tier 1 (AT1) capital
|
|
|
|
Capital instruments and related share premium accounts
|
7,694
|
7,690
|
6,449
|
Qualifying AT1 capital (including minority interests) issued by
subsidiaries
|
3,843
|
4,576
|
5,445
|
Other regulatory adjustments and deductions
|
(130)
|
(131)
|
(130)
|
Transitional AT1 capital
5
|
11,407
|
12,135
|
11,764
|
PRA Transitional Tier 1 capital
|
54,241
|
57,073
|
56,968
|
|
|
|
|
Tier 2 (T2) capital
|
|
|
|
Capital instruments and related share premium accounts
|
5,198
|
3,724
|
3,769
|
Qualifying T2 capital (including minority interests) issued by
subsidiaries
|
8,486
|
10,153
|
11,366
|
Other regulatory adjustments and deductions
|
(252)
|
(257)
|
(257)
|
PRA Transitional total regulatory capital
|
67,673
|
70,693
|
71,846
|
1
|
The transitional regulatory adjustments to CET1 capital are no
longer applicable resulting in CET1 capital on a fully loaded basis
being equal to that on a transitional basis.
|
2
|
The CRD IV CET1 ratio (FSA October 2012 transitional statement) as
applicable to Barclays’ Tier 2 Contingent Capital Notes was
13.7% based on £44.8bn of transitional CRD IV CET1 capital and
£327bn of RWAs.
|
3
|
The PRA transitional capital is based on the PRA Rulebook and
accompanying supervisory statements.
|
4
|
As at 30 June 2017, Barclays’ fully loaded Tier 1 capital was
£50,398m, and the fully loaded Tier 1 ratio was 15.4%. Fully
loaded total regulatory capital was £64,709m and the fully
loaded total capital ratio was 19.8%. The fully loaded Tier 1
capital and total capital measures are calculated without applying
the transitional provisions set out in CRD IV and assessing
compliance of AT1 and T2 instruments against the relevant criteria
in CRD IV.
|
5
|
Of the £11.4bn transitional AT1 capital, fully loaded AT1
capital used for the leverage ratio comprises the £7.7bn
capital instruments and related share premium accounts and
£0.1bn capital deductions. It excludes legacy Tier 1 capital
instruments issued by subsidiaries that are subject to
grandfathering.
|
Movement in CET1 capital
|
Three months
|
Half year
|
ended
|
ended
|
30.06.17
|
30.06.17
|
£m
|
£m
|
Opening CET1 capital
|
44,938
|
45,204
|
|
|
|
Loss for the period attributable to equity holders
|
(1,239)
|
(910)
|
Own credit relating to derivative liabilities
|
64
|
79
|
Dividends paid and foreseen
|
(241)
|
(473)
|
Decrease in retained regulatory capital generated from
earnings
|
(1,416)
|
(1,304)
|
|
|
|
Net impact of share schemes
|
272
|
(163)
|
Available for sale reserves
|
(7)
|
58
|
Currency translation reserves
|
947
|
705
|
Other reserves
|
(372)
|
(934)
|
Increase/(decrease) in other qualifying reserves
|
840
|
(334)
|
|
|
|
Retirement benefit reserve
|
(416)
|
(29)
|
Defined-benefit pension fund asset deduction
|
211
|
(504)
|
Net impact of pensions
|
(205)
|
(533)
|
|
|
|
Minority interests
|
(1,864)
|
(1,825)
|
Additional value adjustments (PVA)
|
124
|
77
|
Goodwill and intangible assets
|
386
|
1,298
|
Deferred tax assets that rely on future profitability excluding
those arising from temporary differences
|
75
|
148
|
Excess of expected loss over impairment
|
107
|
115
|
Deferred tax assets arising from temporary differences (amount
above 10% threshold)
|
(76)
|
68
|
Other regulatory adjustments
|
(75)
|
(80)
|
Decrease in regulatory capital due to adjustments and
deductions
|
(1,323)
|
(199)
|
|
|
|
Closing CET1 capital
|
42,834
|
42,834
|
CET1
capital decreased £2.4bn to £42.8bn (December 2016:
£45.2bn) due to the following:
●
|
A
£0.9bn loss for the period attributable to equity holders.
£1.4bn profit after tax in respect of continuing operations
was more than offset by losses in discontinued operation of
£2.3bn. These losses, resulting from the impairment of
Barclays’ holding in BAGL allocated to goodwill and the
recycling of BAGL currency translation reserve losses to the income
statement, had no impact on CET1 capital with offsetting movements
in the goodwill and intangible assets deduction and other
qualifying reserves
|
●
|
A
£0.5bn decrease for dividends paid and foreseen
|
●
|
A
£0.7bn increase in the currency translation reserve largely
due to the £1.4bn recycling of losses in BAGL to the income
statement which were offset by a £0.6bn decrease due to the
appreciation of GBP against USD and JPY
|
●
|
A
£0.9bn decrease in other qualifying reserves which included a
£0.5bn decrease as a result of USD preference share
redemptions, and £0.4bn separation payments in relation to the
partial BAGL disposal
|
●
|
A
£0.5bn decrease net of tax as a result of movements relating
to pensions. The pension asset capital deduction increased due to
the UKRF, which is the Group’s main pension scheme, moving
from a small deficit in December 2016 to a £0.7bn surplus
largely due to contributions in the period
|
●
|
A
£1.8bn decrease due to BAGL minority interests which are no
longer eligible under proportional consolidation
|
●
|
A
£1.3bn increase due to the goodwill and a decrease in the
intangible assets deduction largely as a result of the impairment
of Barclays’ holding in BAGL allocated to
goodwill
|
Risk weighted assets (RWAs) by risk type and business
|
|
Credit risk
|
|
Counterparty credit risk
|
|
|
Market risk
|
|
Operational risk
|
Total RWAs
|
|
Std
|
IRB
|
|
Std
|
IRB
|
Settle-ment Risk
|
CVA
|
|
Std
|
IMA
|
|
|
|
As at 30.06.17
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
|
£m
|
£m
|
Barclays UK
|
3,768
|
49,979
|
|
3
|
-
|
-
|
31
|
|
-
|
-
|
|
12,338
|
66,119
|
Barclays International
|
49,382
|
81,109
|
|
15,456
|
13,962
|
32
|
2,205
|
|
11,100
|
11,460
|
|
27,538
|
212,244
|
Head Office
1
|
2,612
|
7,891
|
|
68
|
535
|
-
|
207
|
|
146
|
1,876
|
|
12,871
|
26,206
|
Barclays Core
|
55,762
|
138,979
|
|
15,527
|
14,497
|
32
|
2,443
|
|
11,246
|
13,336
|
|
52,747
|
304,569
|
Barclays Non-Core
|
2,627
|
9,102
|
|
874
|
4,072
|
-
|
590
|
|
294
|
1,373
|
|
3,913
|
22,845
|
Barclays Group
|
58,389
|
148,081
|
|
16,401
|
18,569
|
32
|
3,033
|
|
11,540
|
14,709
|
|
56,660
|
327,414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at 31.03.17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barclays UK
|
4,629
|
49,330
|
|
-
|
-
|
1
|
43
|
|
-
|
-
|
|
12,338
|
66,341
|
Barclays International
|
50,609
|
83,643
|
|
15,942
|
14,007
|
77
|
2,251
|
|
10,481
|
9,716
|
|
27,538
|
214,264
|
Head Office
1
|
9,182
|
25,660
|
|
99
|
1,040
|
-
|
851
|
|
567
|
2,716
|
|
12,746
|
52,861
|
Barclays Core
|
64,420
|
158,633
|
|
16,041
|
15,047
|
78
|
3,145
|
|
11,048
|
12,432
|
|
52,622
|
333,466
|
Barclays Non-Core
|
4,036
|
9,396
|
|
1,034
|
5,106
|
-
|
638
|
|
337
|
2,827
|
|
4,038
|
27,412
|
Barclays Group
|
68,456
|
168,029
|
|
17,075
|
20,153
|
78
|
3,783
|
|
11,385
|
15,259
|
|
56,660
|
360,878
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at 31.12.16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Barclays UK
|
5,592
|
49,591
|
|
47
|
-
|
-
|
-
|
|
-
|
-
|
|
12,293
|
67,523
|
Barclays International
|
53,201
|
82,327
|
|
13,515
|
13,706
|
30
|
3,581
|
|
9,343
|
9,460
|
|
27,538
|
212,701
|
Head Office
1
|
9,048
|
27,122
|
|
77
|
1,157
|
-
|
927
|
|
482
|
2,323
|
|
12,156
|
53,292
|
Barclays Core
|
67,841
|
159,040
|
|
13,639
|
14,863
|
30
|
4,508
|
|
9,825
|
11,783
|
|
51,987
|
333,516
|
Barclays Non-Core
|
4,714
|
9,945
|
|
1,043
|
6,081
|
37
|
2,235
|
|
477
|
2,928
|
|
4,673
|
32,133
|
Barclays Group
|
72,555
|
168,985
|
|
14,682
|
20,944
|
67
|
6,743
|
|
10,302
|
14,711
|
|
56,660
|
365,649
|
Movement analysis of RWAs
|
|
Credit risk
|
Counterparty credit risk
|
Market risk
|
Operational risk
|
Total RWAs
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
As at 01.01.17
|
241.5
|
42.4
|
25.0
|
56.7
|
365.6
|
Book size
|
(2.1)
|
(2.6)
|
2.8
|
-
|
(1.9)
|
Acquisitions and disposals
|
(27.7)
|
(1.3)
|
(1.5)
|
-
|
(30.5)
|
Book quality
|
(1.3)
|
0.1
|
0.1
|
-
|
(1.1)
|
Model updates
|
(1.4)
|
-
|
-
|
-
|
(1.4)
|
Methodology and policy
|
0.1
|
(0.6)
|
(0.2)
|
-
|
(0.7)
|
Foreign exchange movements
2
|
(2.6)
|
-
|
-
|
-
|
(2.6)
|
As at 30.06.17
|
206.5
|
38.0
|
26.2
|
56.7
|
327.4
|
1
|
Includes Africa Banking RWAs.
|
2
|
Foreign exchange movement does not include FX for counterparty risk
or market risk.
|
RWAs decreased £38.2bn to £327.4bn, primarily driven by a
£27.9bn reduction as a result of the proportional
consolidation of BAGL, as well as portfolio rundowns and disposals
in Non-Core.
Leverage ratio and exposures
Barclays
is subject to a leverage ratio requirement that is implemented on a
phased basis, with a transitional requirement of 3.4% as at 30 June
2017; this comprises of the 3% minimum requirement, a transitional
G-SII additional leverage ratio buffer (G-SII ALRB) and a
countercyclical leverage ratio buffer (CCLB). Based on both future
and proposed requirements the expected end point leverage
requirement is 4.0%. Additionally, the CRR fully loaded leverage
requirement is currently expected at 3%, although this may be
impacted by the Basel Consultation on the Leverage
Framework.
Barclays
is required to disclose a UK leverage ratio which is based on
capital and exposure measures on the last day of the quarter; as
well as an average UK leverage ratio based on the last day of each
month in the quarter. Both approaches exclude qualifying cash at
central banks from the calculation of leverage exposure. There is
also a CRR leverage ratio disclosure requirement, which is based on
the end point CRR definition of Tier 1 capital and the CRR
definition of leverage exposure.
At 30
June 2017, Barclays’ UK leverage ratio was 5.0% (December
2016: 5.0%) and the average UK leverage ratio was 4.8% (December
2016: 4.5%), which exceeds the transitional leverage requirement
for Barclays of 3.4%, and expected end point leverage requirement
of 4.0%. The CRR leverage ratio was 4.5% (December 2016:
4.6%).
UK leverage ratio
|
As at 30.06.17
|
As at 31.03.17
|
As at 31.12.16
|
£bn
|
£bn
|
£bn
|
Average UK leverage exposure
|
1,092
|
1,130
|
1,137
|
Fully loaded Tier 1 capital (quarterly month end
average)
|
52.1
|
52.3
|
51.6
|
Average UK leverage ratio
|
4.8%
|
4.6%
|
4.5%
|
UK leverage ratio
|
5.0%
|
4.8%
|
5.0%
|
|
|
|
|
CRR leverage ratio
|
|
|
|
Accounting assets
|
|
|
|
Derivative financial instruments
|
260
|
271
|
347
|
Cash collateral
|
58
|
60
|
67
|
Reverse repurchase agreements and other similar secured
lending
|
17
|
18
|
13
|
Financial assets designated at fair value
1
|
107
|
96
|
79
|
Loans and advances and other assets
|
693
|
759
|
707
|
Total IFRS assets
|
1,135
|
1,204
|
1,213
|
|
|
|
|
Regulatory consolidation adjustments
|
10
|
(4)
|
(6)
|
|
|
|
|
Derivatives adjustments
|
|
|
|
Derivatives netting
|
(235)
|
(244)
|
(313)
|
Adjustments to cash collateral
|
(47)
|
(51)
|
(50)
|
Net written credit protection
|
12
|
13
|
12
|
Potential Future Exposure (PFE) on derivatives
|
127
|
137
|
136
|
Total derivatives adjustments
|
(143)
|
(145)
|
(215)
|
|
|
|
|
Securities financing transactions (SFTs) adjustments
|
24
|
35
|
29
|
|
|
|
|
Regulatory deductions and other adjustments
|
(13)
|
(14)
|
(15)
|
Weighted off-balance sheet commitments
|
109
|
121
|
119
|
CRR leverage exposure
|
1,122
|
1,197
|
1,125
|
Fully loaded CET 1 capital
|
42.8
|
44.9
|
45.2
|
Fully loaded AT1 capital
|
7.6
|
8.0
|
6.8
|
Fully loaded Tier 1 capital
|
50.4
|
53.0
|
52.0
|
|
|
|
|
CRR leverage ratio
|
4.5%
|
4.4%
|
4.6%
|
1
|
Included within financial assets designated at fair value reverse
repurchase agreements designated at fair value of £88bn
(December 2016: £63bn).
|
The
average UK leverage exposure as at 30 June 2017, which excludes
qualifying central bank claims, was £1,092bn (December 2016:
£1,137bn), resulting in an average UK leverage ratio of 4.8%
(December 2016: 4.5%). The CET1 capital held against the 0.35%
transitional G-SII ALRB was £3.5bn. The impact of CCLB is
currently nil.
The CRR
leverage ratio decreased to 4.5% (December 2016: 4.6%) primarily
driven by a £1.6bn decrease in fully loaded Tier 1 capital to
£50.4bn (December 2016: £52.0bn):
●
|
Loans
and advances and other assets decreased by £14bn to
£693bn. This was driven primarily by a £67bn decrease in
assets held for sale mainly due to the disposal of Barclays’
holding in BAGL; £44bn increase in cash and balances at
central banks mainly due to an increase in the cash contributions
to the Group liquidity pool; £17bn increase in settlement
balances; £17bn decrease in lending for Barclays International
and a £10bn increase in trading portfolio assets due to client
activity
|
●
|
Reverse
repurchase agreements increased £29bn to £105bn,
primarily due to an increase in matched book trading
|
●
|
Net
derivative leverage exposures, excluding net written credit
protection and PFE on derivatives, decreased £15bn to
£36bn due to a decrease in cash collateral and a reduction in
IFRS derivatives mainly due to decrease in interest rate
derivatives, continued rundown of Non-Core assets and decrease in
foreign exchange derivatives
|
●
|
Regulatory
consolidation adjustments increased £16bn to £10bn
primarily due to the proportional consolidation of BAGL for
regulatory purposes
|
●
|
Potential
future exposure on derivatives decreased £9bn to £127bn
primarily due to portfolio rundown in Non-Core
|
The
difference between the average UK leverage ratio and the CRR
leverage ratio was primarily driven by the exemption of qualifying
central bank claims partially offset by higher positions for April
and May within assets held for sale prior to the BAGL disposal,
trading portfolio assets and settlement balances.
Additional
Barclays’ regulatory disclosures prepared in accordance with
the EBA Guidelines on materiality, proprietary and confidentiality
and on disclosure frequency under Articles 432(1), 432(2) and 433
of Regulation (EU) No 575/2013 (EBA/GL/2014/14) and EBA Guidelines
on disclosure requirements under Part Eight of Regulation (EU) No
575/2013 will be disclosed on 25th August 2017, available at
home.barclays/results.
Page
intentionally left blank
Page
intentionally left blank
Condensed Consolidated Financial Statements
Condensed
consolidated income statement (unaudited)
|
|
|
Half year ended
|
Half year ended
|
|
|
30.06.17
|
30.06.16
|
Continuing operations
|
Notes
1
|
£m
|
£m
|
Net interest income
|
|
5,098
|
5,218
|
Net fee and commission income
|
|
3,550
|
3,299
|
Net trading income
|
|
1,667
|
1,545
|
Net investment income
|
|
528
|
914
|
Other income
|
|
38
|
37
|
Total income
|
|
10,881
|
11,013
|
Credit impairment charges and other provisions
|
|
(1,054)
|
(931)
|
Net operating income
|
|
9,827
|
10,082
|
|
|
|
|
Staff costs
|
2
|
(4,460)
|
(4,601)
|
Administration and general expenses
|
3
|
(3,272)
|
(3,096)
|
Operating expenses
|
|
(7,732)
|
(7,697)
|
|
|
|
|
Profit/(loss) on disposal of undertakings and share of results of
associates and joint ventures
|
|
246
|
(322)
|
Profit before tax
|
|
2,341
|
2,063
|
Tax
|
5
|
(778)
|
(715)
|
Profit after tax in respect of continuing operations
|
|
1,563
|
1,348
|
(Loss)/profit after tax in respect of discontinued
operation
|
4
|
(2,195)
|
311
|
(Loss)/profit after tax
|
|
(632)
|
1,659
|
|
|
|
|
Attributable to:
|
|
|
|
Ordinary equity holders of the parent
|
|
(1,211)
|
1,110
|
Other equity holders
2
|
|
301
|
208
|
Total equity holders
2
|
|
(910)
|
1,318
|
|
|
|
|
Profit attributable to non-controlling interests in respect of
continuing operations
|
6
|
138
|
186
|
Profit attributable to non-controlling interests in respect of
discontinued operation
|
6
|
140
|
155
|
(Loss)/profit after tax
|
|
(632)
|
1,659
|
|
|
|
|
Earnings per share
|
|
p
|
p
|
Basic (loss)/earnings per ordinary share
2
|
7
|
(6.6)
|
6.9
|
Basic earnings per ordinary share in respect of continuing
operations
|
7
|
7.1
|
6.0
|
Basic (loss)/earnings per ordinary share in respect of discontinued
operation
|
7
|
(13.7)
|
0.9
|
Diluted (loss)/earnings per ordinary share
2
|
7
|
(6.5)
|
6.8
|
Diluted earnings per ordinary share
in
respect of continuing operations
|
7
|
7.0
|
5.9
|
1
|
For notes to the Financial Statements see pages 74 to
109.
|
2
|
The profit after tax attributable to other equity holders of
£301m (H116: £208m) is offset by a tax credit recorded in
reserves of £82m (H116: £58m). The net amount of
£219m (H116: £150m), along with non-controlling interests
(NCI) is deducted from profit after tax in order to calculate
earnings per share and return on average
shareholders’
equity.
|
Condensed consolidated statement of comprehensive income
(unaudited)
|
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
|
30.06.17
|
30.06.16
|
|
Notes
1
|
£m
|
£m
|
(Loss)/profit after tax
|
|
(632)
|
1,659
|
Profit after tax in respect of continuing operations
|
|
1,563
|
1,348
|
(Loss)/profit after tax in respect of discontinued
operation
|
|
(2,195)
|
311
|
|
|
|
|
Other comprehensive (loss)/income that may be recycled to profit or
loss from continuing operations:
|
|
Currency translation reserve
|
17
|
(635)
|
1,789
|
Available for sale reserve
|
17
|
69
|
(311)
|
Cash flow hedge reserve
|
17
|
(531)
|
1,747
|
Other
|
|
15
|
(2)
|
Other comprehensive (loss)/income that may be recycled to profit or
loss from continuing operations
|
|
(1,082)
|
3,223
|
|
|
|
|
Other comprehensive loss not recycled to profit or loss from
continuing operations:
|
|
Retirement benefit measurements
|
14
|
(29)
|
(759)
|
Own credit
2
|
|
22
|
-
|
Other comprehensive loss not recycled to profit or loss from
continuing operations
|
|
(7)
|
(759)
|
|
|
|
|
Other comprehensive (loss)/income for the period from continuing
operations
|
|
(1,089)
|
2,464
|
|
|
|
|
Other comprehensive income for the period from discontinued
operation
|
|
1,301
|
985
|
|
|
|
|
Total comprehensive (loss)/income for the period:
|
|
|
|
Total comprehensive income for the period, net of tax from
continuing operations
|
|
474
|
3,812
|
Total comprehensive (loss)/income for the period, net of tax from
discontinued operation
|
|
(894)
|
1,296
|
Total comprehensive (loss)/income for the period
|
|
(420)
|
5,108
|
|
|
|
|
Attributable to:
|
|
|
|
Equity holders of the parent
|
|
(666)
|
4,358
|
Non-controlling interests
|
|
246
|
750
|
Total comprehensive (loss)/income for the period
|
|
(420)
|
5,108
|
1
|
For notes to the Financial Statements see pages 74 to
109.
|
2
|
As a result of the early adoption of the own credit provisions of
IFRS 9 on 1 January 2017, own credit which was previously recorded
in the income statement is now recognised within other
comprehensive income. The cumulative unrealised own credit net loss
of £175m has therefore been reclassified from retained
earnings to a separate own
credit reserve, within Other reserves. During H117 a £22m gain
on own credit has been booked in the reserve.
|
Condensed consolidated balance sheet (unaudited)
|
|
|
As at
|
As at
|
|
|
30.06.17
|
31.12.16
|
Assets
|
Notes
1
|
£m
|
£m
|
Cash and balances at central banks
|
|
146,063
|
102,353
|
Items in the course of collection from other banks
|
|
1,226
|
1,467
|
Trading portfolio assets
|
|
90,698
|
80,240
|
Financial assets designated at fair value
|
|
107,197
|
78,608
|
Derivative financial instruments
|
10
|
259,851
|
346,626
|
Financial investments
|
9
|
61,771
|
63,317
|
Loans and advances to banks
|
|
37,108
|
43,251
|
Loans and advances to customers
|
|
390,004
|
392,784
|
Reverse repurchase agreements and other similar secured
lending
|
|
17,209
|
13,454
|
Current and deferred tax assets
|
5
|
4,901
|
5,430
|
Prepayments, accrued income and other assets
|
|
3,072
|
2,893
|
Investments in associates and joint ventures
|
|
715
|
684
|
Goodwill and intangible assets
|
|
7,724
|
7,726
|
Property, plant and equipment
|
|
2,749
|
2,825
|
Retirement benefit assets
|
14
|
709
|
14
|
Assets included in disposal groups classified as held for
sale
|
4
|
4,319
|
71,454
|
Total assets
|
|
1,135,316
|
1,213,126
|
|
|
|
|
Liabilities
|
|
|
|
Deposits from banks
|
|
48,887
|
48,214
|
Items in the course of collection due to other banks
|
|
778
|
636
|
Customer accounts
|
|
436,863
|
423,178
|
Repurchase agreements and other similar secured
borrowing
|
|
38,578
|
19,760
|
Trading portfolio liabilities
|
|
40,470
|
34,687
|
Financial liabilities designated at fair value
|
|
125,348
|
96,031
|
Derivative financial instruments
|
10
|
260,765
|
340,487
|
Debt securities in issue
2
|
|
76,664
|
75,932
|
Subordinated liabilities
|
12
|
23,879
|
23,383
|
Accruals, deferred income and other liabilities
|
|
6,533
|
8,871
|
Current and deferred tax liabilities
|
5
|
371
|
766
|
Provisions
|
13
|
3,930
|
4,134
|
Retirement benefit liabilities
|
14
|
329
|
390
|
Liabilities included in disposal groups classified as held for
sale
|
4
|
5,658
|
65,292
|
Total liabilities
|
|
1,069,053
|
1,141,761
|
|
|
|
|
Equity
|
|
|
|
Called up share capital and share premium
|
15
|
21,998
|
21,842
|
Other reserves
|
17
|
6,148
|
6,051
|
Retained earnings
|
|
28,026
|
30,531
|
Shareholders' equity attributable to ordinary shareholders of
parent
|
|
56,172
|
58,424
|
Other equity instruments
|
16
|
7,694
|
6,449
|
Total equity excluding non-controlling interests
|
|
63,866
|
64,873
|
Non-controlling interests
|
6
|
2,397
|
6,492
|
Total equity
|
|
66,263
|
71,365
|
Total liabilities and equity
|
|
1,135,316
|
1,213,126
|
1
|
For notes to the Financial Statements see pages 74 to
109.
|
2
|
Debt securities in issue include covered bonds of £10.0bn
(December 2016: £12.4bn).
|
Condensed consolidated statement of changes in equity
(unaudited)
|
|
Called up share capital and share
premium
1
|
Other equity
instruments
1
|
Other reserves
1
|
Retained earnings
|
Total
|
Non-controlling
interests
2
|
Total equity
|
Half year ended 30.06.17
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Balance as at 31 December 2016
|
21,842
|
6,449
|
6,051
|
30,531
|
64,873
|
6,492
|
71,365
|
Effects of changes in accounting policies
3
|
-
|
-
|
(175)
|
175
|
-
|
-
|
-
|
Balance as at 1 January 2017
|
21,842
|
6,449
|
5,876
|
30,706
|
64,873
|
6,492
|
71,365
|
Profit after tax
|
-
|
301
|
-
|
1,124
|
1,425
|
138
|
1,563
|
Currency translation movements
|
-
|
-
|
(634)
|
-
|
(634)
|
(1)
|
(635)
|
Available for sale investments
|
-
|
-
|
69
|
-
|
69
|
-
|
69
|
Cash flow hedges
|
-
|
-
|
(531)
|
-
|
(531)
|
-
|
(531)
|
Retirement benefit remeasurements
|
-
|
-
|
-
|
(29)
|
(29)
|
-
|
(29)
|
Own credit
|
-
|
-
|
22
|
-
|
22
|
-
|
22
|
Other
|
-
|
-
|
-
|
15
|
15
|
-
|
15
|
Total comprehensive income net of tax from continuing
operations
|
-
|
301
|
(1,074)
|
1,110
|
337
|
137
|
474
|
Total comprehensive income net of tax from discontinued
operation
|
-
|
-
|
1,332
|
(2,335)
|
(1,003)
|
109
|
(894)
|
Total comprehensive income for the period
|
-
|
301
|
258
|
(1,225)
|
(666)
|
246
|
(420)
|
Issue of new ordinary shares
|
107
|
-
|
-
|
-
|
107
|
-
|
107
|
Issue of shares under employee share schemes
|
49
|
-
|
-
|
284
|
333
|
-
|
333
|
Issue and exchange of other equity instruments
|
-
|
1,245
|
-
|
-
|
1,245
|
-
|
1,245
|
Coupons paid on other equity instruments
|
-
|
(301)
|
-
|
82
|
(219)
|
-
|
(219)
|
Redemption of preference shares
|
-
|
-
|
-
|
(473)
|
(473)
|
(657)
|
(1,130)
|
Treasury shares
|
-
|
-
|
14
|
(617)
|
(603)
|
-
|
(603)
|
Dividends paid
|
-
|
-
|
-
|
(339)
|
(339)
|
(307)
|
(646)
|
Net equity impact of partial BAGL disposal
|
-
|
-
|
-
|
(359)
|
(359)
|
(3,443)
|
(3,802)
|
Other movements
|
-
|
-
|
-
|
(33)
|
(33)
|
66
|
33
|
Balance as at 30 June 2017
|
21,998
|
7,694
|
6,148
|
28,026
|
63,866
|
2,397
|
66,263
|
|
|
|
|
|
|
|
|
Half year ended 31.12.16
|
|
|
|
|
|
|
|
Balance as at 1 July 2016
|
21,763
|
5,314
|
5,695
|
30,082
|
62,854
|
6,566
|
69,420
|
Profit after tax
|
-
|
249
|
-
|
480
|
729
|
160
|
889
|
Currency translation movements
|
-
|
-
|
1,234
|
-
|
1,234
|
1
|
1,235
|
Available for sale investments
|
-
|
-
|
(76)
|
-
|
(76)
|
-
|
(76)
|
Cash flow hedges
|
-
|
-
|
(949)
|
-
|
(949)
|
-
|
(949)
|
Retirement benefit remeasurements
|
-
|
-
|
-
|
(221)
|
(221)
|
-
|
(221)
|
Other
|
-
|
-
|
-
|
15
|
15
|
-
|
15
|
Total comprehensive income net of tax from continuing
operations
|
-
|
249
|
209
|
274
|
732
|
161
|
893
|
Total comprehensive income net of tax from discontinued
operation
|
-
|
-
|
116
|
27
|
143
|
672
|
815
|
Total comprehensive income for the period
|
-
|
249
|
325
|
301
|
875
|
833
|
1,708
|
Issue of new ordinary shares
|
40
|
-
|
-
|
-
|
40
|
-
|
40
|
Issue of shares under employee share schemes
|
39
|
-
|
-
|
442
|
481
|
-
|
481
|
Issue and exchange of other equity instruments
|
-
|
1,132
|
-
|
-
|
1,132
|
-
|
1,132
|
Coupons paid on other equity instruments
|
-
|
(249)
|
-
|
70
|
(179)
|
-
|
(179)
|
Redemption of preference shares
|
-
|
-
|
-
|
(164)
|
(164)
|
(620)
|
(784)
|
Treasury shares
|
-
|
-
|
31
|
(31)
|
-
|
-
|
-
|
Dividends paid
|
-
|
-
|
-
|
(169)
|
(169)
|
(295)
|
(464)
|
Net equity impact of partial BAGL disposal
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Other movements
|
-
|
3
|
-
|
-
|
3
|
8
|
11
|
Balance as at 31 December 2016
|
21,842
|
6,449
|
6,051
|
30,531
|
64,873
|
6,492
|
71,365
|
1
|
Details of Called up share capital and share premium, Other equity
instruments and Other reserves are shown on pages 94 to
95.
|
2
|
Details of Non-controlling interests are shown on page
79.
|
3
|
As a result of the early adoption of the own credit provisions of
IFRS 9 on 1 January 2017, own credit which was previously recorded
in the income statement is now recognised within other
comprehensive income. The cumulative unrealised own credit net loss
of £175m has therefore been reclassified from retained
earnings to a separate own
credit reserve, within Other reserves. During H117 a £22m gain
on own credit has been booked in the reserve.
|
Condensed consolidated statement of changes in equity
(unaudited)
|
|
Called up share capital and share
premium
1
|
Other equity
instruments
1
|
Other reserves
1
|
Retained earnings
|
Total
|
Non-controlling
interests
2
|
Total equity
|
Half year ended 30.06.16
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Balance as at 1 January 2016
|
21,586
|
5,305
|
1,898
|
31,021
|
59,810
|
6,054
|
65,864
|
Profit after tax
|
-
|
208
|
-
|
954
|
1,162
|
186
|
1,348
|
Currency translation movements
|
-
|
-
|
1,788
|
-
|
1,788
|
1
|
1,789
|
Available for sale investments
|
-
|
-
|
(311)
|
-
|
(311)
|
-
|
(311)
|
Cash flow hedges
|
-
|
-
|
1,747
|
-
|
1,747
|
-
|
1,747
|
Retirement benefit remeasurements
|
-
|
-
|
-
|
(759)
|
(759)
|
-
|
(759)
|
Other
|
-
|
-
|
-
|
(3)
|
(3)
|
1
|
(2)
|
Total comprehensive income net of tax from continuing
operations
|
-
|
208
|
3,224
|
192
|
3,624
|
188
|
3,812
|
Total comprehensive income net of tax from discontinued
operation
|
-
|
-
|
578
|
156
|
734
|
562
|
1,296
|
Total comprehensive income for the period
|
-
|
208
|
3,802
|
348
|
4,358
|
750
|
5,108
|
Issue of new ordinary shares
|
28
|
-
|
-
|
-
|
28
|
-
|
28
|
Issue of shares under employee share schemes
|
149
|
-
|
-
|
226
|
375
|
-
|
375
|
Coupons paid on other equity instruments
|
-
|
(208)
|
-
|
58
|
(150)
|
-
|
(150)
|
Redemption of preference shares
|
-
|
-
|
-
|
(253)
|
(253)
|
(550)
|
(803)
|
Treasury shares
|
-
|
-
|
(5)
|
(384)
|
(389)
|
-
|
(389)
|
Dividends paid
|
-
|
-
|
-
|
(588)
|
(588)
|
(280)
|
(868)
|
Net equity impact of partial BAGL disposal
|
-
|
-
|
-
|
(349)
|
(349)
|
601
|
252
|
Other movements
|
-
|
9
|
-
|
3
|
12
|
(9)
|
3
|
Balance as at 30 June 2016
|
21,763
|
5,314
|
5,695
|
30,082
|
62,854
|
6,566
|
69,420
|
|
|
|
|
|
|
|
|
1
|
Details of Called up share capital and share premium, Other equity
instruments and Other reserves are shown on pages 94 to
95.
|
2
|
Details of Non-controlling interests are shown on page
79.
|
Condensed consolidated cash flow statement (unaudited)
|
|
|
|
|
|
Half year ended
|
Half year ended
|
|
|
30.06.17
|
30.06.16
|
|
Notes
1
|
£m
|
£m
|
Continuing operations
|
|
|
|
Profit before tax
|
|
2,341
|
2,063
|
Adjustment for non-cash items
|
|
1,041
|
(8,913)
|
Changes in operating assets and liabilities
|
|
32,088
|
25,129
|
Corporate income tax paid
|
|
(530)
|
(394)
|
Net cash from operating activities
|
|
34,940
|
17,885
|
Net cash from investing activities
|
|
2,043
|
14,376
|
Net cash from financing activities
|
|
287
|
(1,709)
|
Effect of exchange rates on cash and cash equivalents
|
|
(1,092)
|
6,897
|
Net increase in cash and cash equivalents from continuing
operations
|
|
36,178
|
37,449
|
Net cash from discontinued operation
|
4
|
101
|
371
|
Net increase in cash and cash equivalents
|
|
36,279
|
37,820
|
Cash and cash equivalents at beginning of the period
|
|
144,110
|
86,556
|
Cash and cash equivalents at end of the period
|
|
180,389
|
124,376
|
1
|
For notes to the Financial Statements see pages 74 to
109.
|
Financial Statement Notes
1.
Basis of preparation
These
condensed consolidated interim financial statements for the six
months ended 30 June 2017 have been prepared in accordance with the
Disclosure and Transparency Rules of the Financial Conduct
Authority and with IAS 34, ‘Interim Financial
Reporting’, as published by the IASB and adopted by the
European Union. The condensed consolidated interim financial
statements should be read in conjunction with the annual financial
statements for the year ended 31 December 2016, which have been
prepared in accordance with IFRSs as adopted by the European
Union.
The
accounting policies and methods of computation used in these
condensed consolidated interim financial statements are the same as
those used in the Barclays 2016 Annual Report, except for the
option in IFRS 9 to recognise changes in own credit in other
comprehensive income, which Barclays has applied from 1 January
2017 as detailed in Note 17. This will have no effect on net
assets, and any changes due to own credit in prior periods have not
been restated. Any realised and unrealised amounts recognised in
other comprehensive income will not be reclassified to the income
statement in future periods.
Future accounting developments
IFRS 9 – Financial instruments
IFRS 9
Financial Instruments which will replace IAS 39 Financial
Instruments: Recognition and Measurement is effective for periods
beginning on or after 1 January 2018 and was endorsed by the EU in
November 2016. IFRS 9, in particular the impairment requirements,
will lead to significant changes in the accounting for financial
instruments. Barclays will not restate comparatives on initial
application of IFRS 9 on 1 January 2018 but will provide detailed
transition disclosures in accordance with the amended requirements
of IFRS 7.
Barclays
has a jointly accountable Risk and Finance IFRS 9 implementation
programme with representation from all impacted
departments.
In
respect of the impairment and classification and measurement
implementation programmes for financial assets, work has continued
to prepare for adoption on 1 January 2018, with the focus during
2017 on quantifying impact, model validation and finalising
processes, governance and controls.
As
permitted by IFRS 9, Barclays will continue applying the IAS 39
hedge accounting requirements but will provide the new hedge
accounting disclosures required by the amended IFRS 7.
Since
the publication of the 2016 Annual Report, the IASB has issued an
Exposure Draft potentially impacting financial assets with
prepayment features with negative compensation. Such prepayment
features are present in some fixed rate corporate and investment
bank loans. If such loans are concluded to be measured at fair
value through profit or loss, the potential impact on opening
equity and profit or loss would depend on their fair values
compared to their carrying amounts, and the future changes in fair
value. The IASB is currently considering comments received on the
proposals.
Barclays
will disclose the financial impact estimates when the
implementation programme, validation and testing is further
advanced, which is expected to be no later than the Barclays Annual
Report 2017.
For
further information on this and other new standards refer to the
Barclays 2016 Annual Report.
Going concern
Having
reassessed the principal risks, the directors considered it
appropriate to adopt the going concern basis of accounting in
preparing the interim financial information.
2.
Staff costs
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
Compensation costs
|
£m
|
£m
|
Current year bonus charges
|
558
|
393
|
Deferred bonus charge
|
340
|
369
|
Commissions and other incentives
1
|
58
|
35
|
Performance costs
|
956
|
797
|
Salaries
|
1,968
|
2,056
|
Social security costs
|
297
|
303
|
Post-retirement benefits
|
253
|
245
|
Other compensation costs
|
189
|
179
|
Total compensation costs
|
3,663
|
3,580
|
|
|
|
Other resourcing costs
|
|
|
Outsourcing
|
579
|
460
|
Redundancy and restructuring
|
23
|
266
|
Temporary staff costs
|
167
|
250
|
Other
|
28
|
45
|
Total other resourcing costs
|
797
|
1,021
|
|
|
|
Total staff costs
|
4,460
|
4,601
|
|
|
|
Group compensation as % of income
|
37
|
36
|
1
|
Amounts previously included in 2016 as commitments are now included
in current and deferred bonus charges for consistency with
2017.
|
Total
staff costs decreased 3% to £4,460m, principally
reflecting:
●
|
A
decrease in other resourcing costs of 22% to £797m mainly due
to a decrease in redundancy and restructuring costs following the
non-recurrence of costs relating to strategic initiatives within
the CIB in the previous year
|
●
|
An
increase in Group performance costs of 20% to £956m due to
changes in the granting of incentives awards to more closely align
to the income statement charge as announced in the Barclays 2016
Results Announcement
|
No
awards have yet been granted in relation to the 2017 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.
3.
Administration and general
expenses
|
Half year
ended
|
Half year
ended
|
|
30.06.17
|
30.06.16
|
|
£m
|
£m
|
Infrastructure costs
|
|
|
Property and equipment
|
671
|
562
|
Depreciation of property, plant and equipment
|
228
|
242
|
Operating lease rentals
|
198
|
235
|
Amortisation of intangible assets
|
342
|
301
|
Impairment of property, equipment and intangible
assets
|
23
|
82
|
Total infrastructure costs
|
1,462
|
1,422
|
|
|
|
Other costs
|
|
|
Consultancy, legal and professional fees
|
535
|
539
|
Subscriptions, publications, stationery and
communications
|
284
|
333
|
Marketing, advertising and sponsorship
|
189
|
207
|
Travel and accommodation
|
74
|
68
|
Charges for PPI
|
700
|
400
|
Other administration and general expenses
|
28
|
127
|
Total other costs
|
1,810
|
1,674
|
|
|
|
Total administration and general expenses
|
3,272
|
3,096
|
|
|
|
4.
Held for sale assets and discontinued
operation
The
Group applies IFRS 5 Non-current Assets Held for Sale and
Discontinued Operations.
On 1
March 2016, Barclays announced its intention to reduce the
Group’s 62.3% interest in BAGL. On 5 May 2016, Barclays sold
12.2% of the Group’s interest in BAGL. On 1 June 2017,
Barclays reduced its shareholding by a further 33.7%. As a result,
Barclays accounts for a holding of 16.4% with an obligation to
contribute to a BEE scheme leaving a residual holding of 14.9%.
This resulted in accounting deconsolidation of BAGL from the Group
as of 1 June 2017, with the holding recognised as an available for
sale investment valued at £1,146m in Barclays’ financial
statements.
Prior
to the sale of shares on 1 June 2017, impairment of £1,090m
was recognised under IFRS 5 against the net assets of BAGL.
Impairment under IFRS 5 is calculated as the difference between
fair value less disposal costs and the carrying value of the
disposal group. The fair value is determined by reference to the
quoted market price for BAGL and the opening foreign exchange rate
for ZAR/GBP as at 1 June
2017. Payments of £0.7bn have
been made following execution of separation agreements and the
completion of the sale. As at 30 June 2017, a liability for the
obligation to the BEE scheme of £105m is reflected on the
balance sheet.
The
remaining balance in held for sale predominantly relates to the
disposal of the French retail and Zimbabwean businesses which are
intended for disposal early in the second half of
2017.
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
Assets included in disposal groups classified as held for
sale
|
£m
|
£m
|
Cash and balances at central banks
|
204
|
2,930
|
Items in the course of collection from other banks
|
17
|
570
|
Trading portfolio assets
|
-
|
3,084
|
Financial assets designated at fair value
|
1,365
|
6,984
|
Derivative financial instruments
|
-
|
1,992
|
Financial investments
|
1,915
|
7,737
|
Loans and advances to banks
|
172
|
1,666
|
Loans and advances to customers
|
1,020
|
43,504
|
Current and deferred tax assets
|
2
|
149
|
Prepayments, accrued income and other assets
|
8
|
696
|
Investments in associates and joint ventures
|
11
|
87
|
Goodwill and intangible assets
|
3
|
1,567
|
Property, plant and equipment
|
41
|
954
|
Retirement benefit assets
|
-
|
33
|
Total
|
4,758
|
71,953
|
Balance of impairment unallocated under IFRS 5
|
(439)
|
(499)
|
Total assets classified as held for sale
|
4,319
|
71,454
|
|
|
|
Liabilities included in disposal groups classified as held for
sale
|
|
|
Deposits from banks
|
18
|
2,149
|
Items in the course of collection due to other banks
|
24
|
373
|
Customer accounts
|
2,477
|
42,431
|
Repurchase agreements and other similar secured
borrowing
|
-
|
597
|
Trading portfolio liabilities
|
-
|
388
|
Financial liabilities designated at fair value
|
3,013
|
7,325
|
Derivative financial instruments
|
-
|
1,611
|
Debt securities in issue
|
-
|
7,997
|
Subordinated liabilities
|
-
|
934
|
Accruals, deferred income and other liabilities
|
79
|
1,180
|
Current and deferred tax liabilities
|
-
|
162
|
Provisions
|
14
|
103
|
Retirement benefit liabilities
|
33
|
42
|
Total liabilities classified as held for sale
|
5,658
|
65,292
|
|
|
|
Net (liabilities)/assets classified as held for sale
|
(1,339)
|
6,162
|
Expected contribution to BAGL
|
-
|
866
|
Disposal group post contribution
|
(1,339)
|
7,028
|
Prior
to the sale of shares on 1 June 2017, BAGL met the requirements for
presentation as a discontinued operation. As such, the results,
which have been presented as the profit after tax and
non-controlling interest in respect of the discontinued operation
on the face of the Group income statement, are analysed in the
income statement below. The income statement, statement of other
comprehensive income and cash flow statement below represent five
months of results as a discontinued operation to 31 May 2017,
compared to the half year ended 30 June 2016.
|
Half year ended
|
Half year ended
|
Barclays Africa disposal group income statement
|
30.06.17
|
30.06.16
|
|
£m
|
£m
|
Net interest income
|
1,024
|
982
|
Net fee and commission income
|
522
|
479
|
Net trading income
|
149
|
130
|
Net investment income
|
30
|
21
|
Net premiums from insurance contracts
|
161
|
164
|
Other income
|
(16)
|
8
|
Total income
|
1,870
|
1,784
|
Net claims and benefits incurred on insurance
contracts
|
(84)
|
(87)
|
Total income net of insurance claims
|
1,786
|
1,697
|
Credit impairment charges and other provisions
|
(177)
|
(244)
|
Net operating income
|
1,609
|
1,453
|
|
|
|
Staff costs
|
(586)
|
(522)
|
Administration and general expenses
1
|
(1,634)
|
(498)
|
Operating expenses
|
(2,220)
|
(1,020)
|
|
|
|
Share of post-tax results of associates and joint
ventures
|
5
|
2
|
(Loss)/profit before tax
|
(606)
|
435
|
Tax
|
(154)
|
(124)
|
(Loss)/profit after tax
|
(760)
|
311
|
|
|
|
Attributable to:
|
|
|
Equity holders of the parent
|
(900)
|
156
|
Non-controlling interests
|
140
|
155
|
(Loss)/profit after
tax
2
|
(760)
|
311
|
1
|
Includes impairment of £1,090m (H116: £nil).
|
2
|
Total loss in respect of the discontinued operation was
£2,195m which includes £60m loss on sale and £1,375m
loss on recycling of other comprehensive loss on
reserves.
|
|
Half year ended
|
Half year ended
|
Statement of other comprehensive income from discontinued
operation
|
30.06.17
|
30.06.16
|
|
£m
|
£m
|
Available for sale assets
|
(3)
|
1
|
Currency translation reserves
|
(38)
|
534
|
Cash flow hedge reserves
|
19
|
43
|
Other comprehensive (loss)/income, net of tax from discontinued
operation
|
(22)
|
578
|
|
|
|
|
Half year ended
|
Half year ended
|
Cash flows from discontinued operation
|
30.06.17
|
30.06.16
|
|
£m
|
£m
|
Net cash flows from operating activities
|
540
|
(507)
|
Net cash flows from investing activities
|
(245)
|
459
|
Net cash flows from financing activities
|
(165)
|
(108)
|
Effect of exchange rates on cash and cash equivalents
|
(29)
|
527
|
Net increase in cash and cash equivalents
|
101
|
371
|
5.
Tax
|
Assets
|
|
Liabilities
|
|
As at
30.06.17
|
As at
31.12.16
|
|
As at
30.06.17
|
As at
31.12.16
|
Current and deferred tax assets and liabilities
|
£m
|
£m
|
|
£m
|
£m
|
Current tax
|
411
|
561
|
|
(324)
|
(737)
|
Deferred tax
|
4,490
|
4,869
|
|
(47)
|
(29)
|
Total
|
4,901
|
5,430
|
|
(371)
|
(766)
|
The deferred tax asset of £4,490m (December 2016:
£4,869m) includes £3,658m (December 2016: £3,973m)
related to amounts in the US, with the majority of the remaining
£832m (December 2016: £896m) related to amounts in the
UK. Of the total deferred tax asset, £362m (December 2016:
£503m) related to tax losses and £4,128m (December 2016:
£4,366m) related to temporary differences.
The tax charge for H117 was £778m (H116: £715m),
representing an effective tax rate of 33.2% (H116: 34.7%). The
effective tax rate is higher than the UK statutory tax rate of
19.25% (2016: 20%) primarily due to profits outside the UK taxed at
higher local statutory tax rates,
charges for PPI
being non-deductible for tax purposes,
the tax surcharge of 8% that applies to banks’ UK profits,
non-deductible expenses and non-creditable taxes. These factors,
which have each increased the effective tax rate, are partially
offset by the impact of non-taxable gains and
income.
6.
Non-controlling
interests
|
Profit attributable to non-controlling interests
|
|
Equity attributable to non-controlling interests
|
|
Half year ended
|
Half year ended
|
|
As at
|
As at
|
|
30.06.17
|
30.06.16
|
|
30.06.17
|
31.12.16
|
|
£m
|
£m
|
|
£m
|
£m
|
Barclays Bank PLC Issued:
|
|
|
|
|
|
- Preference shares
|
134
|
182
|
|
2,041
|
2,698
|
- Upper Tier 2 instruments
|
2
|
2
|
|
272
|
272
|
Barclays Africa Group Limited
|
140
|
155
|
|
-
|
3,507
|
Other non-controlling interests
|
2
|
2
|
|
84
|
15
|
Total
|
278
|
341
|
|
2,397
|
6,492
|
Equity
attributable to non-controlling interests decreased by £4,095m
to £2,397m as at 30 June 2017 driven by Barclays’ sale
of 33.7% of BAGL’s issued share capital, which resulted in
accounting deconsolidation of BAGL from the Group, and by the
redemption of $1.375bn Barclays Bank PLC 7.1% Series 3
non-cumulative callable preference shares on 15 March
2017.
7.
Earnings per share
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
|
£m
|
£m
|
(Loss)/profit attributable to ordinary equity holders of the parent
from continuing and discontinued operations
|
(1,211)
|
1,110
|
Tax credit on profit after tax attributable to other equity
holders
|
82
|
58
|
Total (loss)/profit attributable to ordinary equity holders of the
parent from continuing and discontinued operations
|
(1,129)
|
1,168
|
|
|
|
Continuing operations
|
|
|
Profit attributable to ordinary equity holders of the parent from
continuing operations
|
1,124
|
954
|
Tax credit on profit after tax attributable to other equity
holders
|
82
|
58
|
Profit attributable to equity holders of the parent from continuing
operations
|
1,206
|
1,012
|
|
|
|
Discontinued operation
|
|
|
(Loss)/profit attributable to ordinary equity holders of the parent
from discontinued operation
|
(2,335)
|
156
|
Dilutive impact of convertible options from discontinued
operation
|
-
|
(2)
|
(Loss)/profit attributable to equity holders of the parent from
discontinued operation including dilutive impact on convertible
options
|
(2,335)
|
154
|
|
|
|
(Loss)/profit attributable to equity holders of the parent from
continuing and discontinued operations including dilutive impact on
convertible options
|
(1,129)
|
1,166
|
|
|
|
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
|
m
|
m
|
Basic weighted average number of shares in issue
|
16,989
|
16,859
|
Number of potential ordinary shares
|
304
|
182
|
Diluted weighted average number of shares
|
17,293
|
17,041
|
|
|
|
|
p
|
p
|
Basic (loss)/earnings per ordinary share
1
|
(6.6)
|
6.9
|
Basic earnings per ordinary share in respect of continuing
operations
|
7.1
|
6.0
|
Basic (loss)/earnings per ordinary share in respect of discontinued
operation
|
(13.7)
|
0.9
|
Diluted (loss)/earnings per ordinary share
|
(6.5)
|
6.8
|
Diluted earnings per ordinary share in respect of continuing
operations
|
7.0
|
5.9
|
Diluted (loss)/earnings per ordinary share in respect of
discontinued operation
|
(13.5)
|
0.9
|
1
|
The profit after tax attributable to other equity holders of
£301m (H116: £208m) is offset by a tax credit recorded in
reserves of £82m (H116: £58m). The net amount of
£219m (H116: £150m), along with non-controlling interests
(NCI) is deducted from profit after tax in order to calculate
earnings per share.
|
8.
Dividends on ordinary shares
It is
Barclays’ policy to declare and pay dividends on a
semi-annual basis. An interim dividend for 2017 of 1.0p (H116:
1.0p) per ordinary share will be paid on 18 September 2017 to
shareholders on the Share Register on 11 August 2017.
|
Half year ended 30.06.17
|
Half year ended 30.06.16
|
|
Per share
|
Total
|
Per share
|
Total
|
Dividends paid during the period
|
p
|
£m
|
p
|
£m
|
Final dividend paid during period
|
2.0
|
339
|
3.5
|
588
|
For
qualifying US and Canadian resident ADR holders, the interim
dividend of 1.0p per ordinary share becomes 4.0p per ADS
(representing four shares). The ADR depositary will post the
interim dividend on 18 September 2017 to ADR holders on the record
at close of business on 11 August 2017.
9.
Financial investments
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
|
£m
|
£m
|
Available for sale debt securities and other eligible
bills
|
55,082
|
57,703
|
Available for sale equity securities
|
1,547
|
438
|
Held to maturity debt securities
|
5,142
|
5,176
|
Financial investments
|
61,771
|
63,317
|
10.
Derivative financial
instruments
|
|
|
|
|
|
Contract Notional
Amount
|
|
Fair Value
|
|
|
Assets
|
Liabilities
|
As at 30.06.17
|
£m
|
|
£m
|
£m
|
Foreign exchange derivatives
|
4,619,552
|
|
61,638
|
(61,512)
|
Interest rate derivatives
|
32,817,795
|
|
167,317
|
(159,504)
|
Credit derivatives
|
889,924
|
|
15,338
|
(14,452)
|
Equity and stock index and commodity derivatives
|
883,443
|
|
15,125
|
(24,280)
|
Derivative assets/(liabilities) held for trading
|
39,210,714
|
|
259,418
|
(259,748)
|
|
|
|
|
|
Derivatives in hedge accounting relationships
|
|
|
|
|
Derivatives designated as cash flow hedges
|
172,316
|
|
195
|
(35)
|
Derivatives designated as fair value hedges
|
111,170
|
|
198
|
(963)
|
Derivatives designated as hedges of net investments
|
3,227
|
|
40
|
(19)
|
Derivative assets/(liabilities) designated in hedge accounting
relationships
|
286,713
|
|
433
|
(1,017)
|
|
|
|
|
|
Total recognised derivative assets/(liabilities)
|
39,497,427
|
|
259,851
|
(260,765)
|
|
|
|
|
|
As at 31.12.16
|
|
|
|
|
Foreign exchange derivatives
|
4,229,796
|
|
79,260
|
(78,248)
|
Interest rate derivatives
|
30,011,026
|
|
228,133
|
(219,298)
|
Credit derivatives
|
947,800
|
|
16,273
|
(15,085)
|
Equity and stock index and commodity derivatives
|
997,198
|
|
21,958
|
(27,015)
|
Derivative assets/(liabilities) held for trading
|
36,185,820
|
|
345,624
|
(339,646)
|
|
|
|
|
|
Derivatives in hedge accounting relationships
|
|
|
|
|
Derivatives designated as cash flow hedges
|
188,863
|
|
669
|
(33)
|
Derivatives designated as fair value hedges
|
141,575
|
|
301
|
(744)
|
Derivatives designated as hedges of net investments
|
6,086
|
|
32
|
(64)
|
Derivative assets/(liabilities) designated in hedge accounting
relationships
|
336,524
|
|
1,002
|
(841)
|
|
|
|
|
|
Total recognised derivative assets/(liabilities)
|
36,522,344
|
|
346,626
|
(340,487)
|
|
|
|
|
|
Derivative
assets decreased by £87bn to £260bn primarily due to
interest rate derivatives reflecting the adoption of a CME rulebook
change to daily settlement, continued rundown of the Non-Core
derivative back book and an increase in major interest rate forward
curves and foreign exchange derivatives due to depreciation of USD
against GBP as at the reporting date.
The
IFRS netting posted against derivative assets was £13bn
including £1bn of cash collateral netted (December 2016:
£12bn including £1bn cash collateral netted) and
£12bn for liabilities (December 2016: £11bn) with no cash
collateral netted. Derivative asset exposures would be £238bn
(December 2016: £315bn) 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
£34bn (December 2016: £42bn). Similarly, derivative
liabilities would be £238bn (December 2016: £317bn) lower
reflecting counterparty netting and cash collateral placed of
£34bn (December 2016: £44bn). In addition, non cash
collateral of £6bn (December 2016: £8bn) was held in
respect of derivative assets and £2bn (December 2016:
£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.
Of the
£34bn cash collateral held, £22bn (December 2016:
£27bn) was included in deposits from banks and £12bn
(December 2016: £15bn), was included in customer accounts. Of
the £34bn cash collateral placed, £15bn (December 2016:
£18bn) was included in loans and advances to banks and
£19bn (December 2016: £26bn) was included in loans and
advances to customers.
11.
Fair value of financial
instruments
This
section should be read in conjunction with Note 18 Fair value of
financial instruments of the 2016 Annual Report, 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 30.06.17
|
£m
|
£m
|
£m
|
|
£m
|
Trading portfolio assets
|
45,457
|
42,996
|
2,245
|
|
90,698
|
Financial assets designated at fair value
|
5,641
|
92,495
|
9,061
|
|
107,197
|
Derivative financial assets
|
3,850
|
248,129
|
7,872
|
|
259,851
|
Available for sale investments
|
25,324
|
30,957
|
348
|
|
56,629
|
Investment property
|
-
|
-
|
141
|
|
141
|
Assets included in disposal groups classified as held for
sale
1
|
-
|
-
|
4,319
|
|
4,319
|
Total assets
|
80,272
|
414,577
|
23,986
|
|
518,835
|
|
|
|
|
|
|
Trading portfolio liabilities
|
(25,352)
|
(15,108)
|
(10)
|
|
(40,470)
|
Financial liabilities designated at fair value
|
(67)
|
(124,598)
|
(683)
|
|
(125,348)
|
Derivative financial liabilities
|
(3,270)
|
(250,621)
|
(6,874)
|
|
(260,765)
|
Liabilities included in disposal groups classified as held for
sale
1
|
-
|
-
|
(5,658)
|
|
(5,658)
|
Total liabilities
|
(28,689)
|
(390,327)
|
(13,225)
|
|
(432,241)
|
|
|
|
|
|
|
As at 31.12.16
|
|
|
|
|
|
Trading portfolio assets
|
41,550
|
36,625
|
2,065
|
|
80,240
|
Financial assets designated at fair value
|
4,031
|
64,630
|
9,947
|
|
78,608
|
Derivative financial assets
|
5,261
|
332,819
|
8,546
|
|
346,626
|
Available for sale investments
|
21,218
|
36,551
|
372
|
|
58,141
|
Investment property
|
-
|
-
|
81
|
|
81
|
Assets included in disposal groups classified as held for
sale
1
|
6,754
|
8,511
|
6,009
|
|
21,274
|
Total assets
|
78,814
|
479,136
|
27,020
|
|
584,970
|
|
|
|
|
|
|
Trading portfolio liabilities
|
(20,205)
|
(14,475)
|
(7)
|
|
(34,687)
|
Financial liabilities designated at fair value
|
(70)
|
(95,121)
|
(840)
|
|
(96,031)
|
Derivative financial liabilities
|
(5,051)
|
(328,265)
|
(7,171)
|
|
(340,487)
|
Liabilities included in disposal groups classified as held for
sale
1
|
(397)
|
(5,224)
|
(6,201)
|
|
(11,822)
|
Total liabilities
|
(25,723)
|
(443,085)
|
(14,219)
|
|
(483,027)
|
|
|
|
|
|
|
1
|
Disposal groups held for sale and measured at fair value less cost
to sell are included in the fair value table. For disposal groups
measured at carrying amount, the underlying financial assets and
liabilities measured at fair value are included in the fair value
disclosures on pages 83 to 90 and items measured at amortised costs
are included on page 91.
|
The
following table shows the Group’s assets and liabilities that
are held at fair value disaggregated by valuation technique (fair
value hierarchy) and product type:
|
Assets
|
Liabilities
|
|
Valuation technique using
|
Valuation technique using
|
|
Quoted
market prices
(Level 1)
|
Observable
inputs
(Level 2)
|
Significant
unobservable
inputs
(Level 3)
|
Quoted
market prices
(Level 1)
|
Observable
inputs
(Level 2)
|
Significant
unobservable
inputs
(Level 3)
|
As at 30.06.17
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Interest rate derivatives
|
-
|
162,322
|
5,389
|
-
|
(156,153)
|
(4,349)
|
Foreign exchange derivatives
|
-
|
61,556
|
122
|
-
|
(61,424)
|
(107)
|
Credit derivatives
|
-
|
14,041
|
1,297
|
-
|
(14,175)
|
(277)
|
Equity derivatives
|
3,133
|
7,859
|
1,059
|
(2,568)
|
(16,179)
|
(2,141)
|
Commodity derivatives
|
717
|
2,351
|
5
|
(702)
|
(2,690)
|
-
|
Government and government sponsored debt
|
35,575
|
50,426
|
40
|
(13,822)
|
(10,411)
|
-
|
Corporate debt
|
-
|
10,759
|
963
|
(14)
|
(1,169)
|
(10)
|
Certificates of deposit, commercial paper and other money market
instruments
|
-
|
1,517
|
-
|
-
|
(6,439)
|
(257)
|
Reverse repurchase and repurchase agreements
|
-
|
88,273
|
-
|
-
|
(82,581)
|
-
|
Non-asset backed loans
|
-
|
6,116
|
7,392
|
-
|
-
|
-
|
Asset backed securities
|
-
|
2,098
|
486
|
-
|
(348)
|
-
|
Commercial real estate loans
|
-
|
-
|
1,127
|
-
|
-
|
-
|
Issued debt
|
-
|
-
|
-
|
-
|
(37,764)
|
(227)
|
Equity cash products
|
40,770
|
6,266
|
130
|
(11,516)
|
(681)
|
-
|
Funds and fund linked products
|
-
|
615
|
202
|
-
|
(113)
|
(9)
|
Private equity investments
|
10
|
-
|
796
|
-
|
(17)
|
(15)
|
Assets and liabilities held for sale
|
-
|
-
|
4,319
|
-
|
-
|
(5,658)
|
Other
1
|
67
|
378
|
659
|
(67)
|
(183)
|
(175)
|
Total
|
80,272
|
414,577
|
23,986
|
(28,689)
|
(390,327)
|
(13,225)
|
|
|
|
|
|
|
|
As at 31.12.16
|
|
|
|
|
|
|
Interest rate derivatives
|
-
|
222,892
|
5,759
|
-
|
(215,213)
|
(4,860)
|
Foreign exchange derivatives
|
-
|
79,612
|
132
|
-
|
(78,263)
|
(51)
|
Credit derivatives
|
-
|
14,662
|
1,611
|
-
|
(14,844)
|
(241)
|
Equity derivatives
|
4,210
|
11,842
|
1,037
|
(4,058)
|
(15,808)
|
(2,007)
|
Commodity derivatives
|
1,052
|
3,809
|
8
|
(991)
|
(4,138)
|
(13)
|
Government and government sponsored debt
|
31,203
|
49,834
|
3
|
(12,761)
|
(11,454)
|
-
|
Corporate debt
|
46
|
11,921
|
969
|
(27)
|
(1,907)
|
(5)
|
Certificates of deposit, commercial paper and other money market
instruments
|
-
|
994
|
-
|
-
|
(6,936)
|
(319)
|
Reverse repurchase and repurchase agreements
|
-
|
63,162
|
-
|
-
|
(55,710)
|
-
|
Non-asset backed loans
|
-
|
2,888
|
8,767
|
-
|
-
|
-
|
Asset backed securities
|
-
|
1,956
|
515
|
-
|
(256)
|
-
|
Commercial real estate loans
|
-
|
-
|
442
|
-
|
-
|
-
|
Issued debt
|
-
|
-
|
-
|
-
|
(31,973)
|
(298)
|
Equity cash products
|
35,399
|
6,478
|
150
|
(7,416)
|
(934)
|
(2)
|
Funds and fund linked products
|
53
|
137
|
273
|
-
|
(170)
|
(37)
|
Private equity investments
|
23
|
110
|
856
|
-
|
(18)
|
(12)
|
Assets and liabilities held for sale
|
6,754
|
8,511
|
6,009
|
(397)
|
(5,224)
|
(6,201)
|
Other
1
|
74
|
328
|
489
|
(73)
|
(237)
|
(173)
|
Total
|
78,814
|
479,136
|
27,020
|
(25,723)
|
(443,085)
|
(14,219)
|
1
|
Other includes asset backed loans, investment properties and
physical commodities.
|
Assets and liabilities reclassified between Level 1 and Level
2
There
were no material transfers between Level 1 and 2 (December 2016:
£2,340m government bonds assets transferred from Level 2 to
Level 1).
Level 3 movement analysis
The
following table summarises the movements in the Level 3 balance
during the period. The table shows gains and losses and includes
amounts for all financial assets and liabilities that are held at
fair value transferred to and from Level 3 during the period.
Transfers have been reflected as if they had taken place at the
beginning of the year.
Assets
and liabilities included in disposal groups classified as held for
sale are not included as these are measured at fair value on a
non-recurring basis.
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.
During
the period, £1.7bn of non-asset backed loans were derecognised
due to a substantial modification of terms on a subset of the ESHLA
loans. The new restructured loans are measured on an amortised cost
basis.
Level
3 movement analysis
|
Sales
|
Issues
|
Settlements
|
Total gains and losses in the period recognised in the income
statement
|
Total gains or losses recognised in OCI
|
Transfers
|
As at 30.06.17
|
|
As at 01.01.17
|
Purchases
|
Trading income
|
Other income
|
In
|
Out
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Government and government sponsored debt
|
3
|
37
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
40
|
Corporate debt
|
969
|
56
|
(71)
|
-
|
(2)
|
14
|
-
|
-
|
27
|
(30)
|
963
|
Non-asset backed loans
|
151
|
369
|
(87)
|
-
|
(21)
|
(2)
|
-
|
-
|
-
|
(7)
|
403
|
Asset backed securities
|
515
|
46
|
(69)
|
-
|
(9)
|
3
|
-
|
-
|
-
|
-
|
486
|
Funds and fund linked products
|
273
|
-
|
(28)
|
-
|
(24)
|
(8)
|
-
|
-
|
11
|
(22)
|
202
|
Equity cash products
|
77
|
32
|
(7)
|
-
|
-
|
(13)
|
-
|
-
|
2
|
-
|
91
|
Other
|
77
|
2
|
(12)
|
-
|
-
|
1
|
-
|
-
|
-
|
(8)
|
60
|
Trading portfolio assets
|
2,065
|
542
|
(274)
|
-
|
(56)
|
(5)
|
-
|
-
|
40
|
(67)
|
2,245
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-asset backed loans
|
8,616
|
-
|
-
|
-
|
(1,706)
|
79
|
-
|
-
|
-
|
-
|
6,989
|
Commercial real estate loans
|
442
|
1,905
|
(1,215)
|
-
|
(29)
|
34
|
(10)
|
-
|
-
|
-
|
1,127
|
Private equity investments
|
562
|
31
|
(106)
|
-
|
-
|
(3)
|
36
|
-
|
28
|
(58)
|
490
|
Other
|
327
|
108
|
(50)
|
-
|
(30)
|
(10)
|
110
|
-
|
-
|
-
|
455
|
Financial assets designated at fair value
|
9,947
|
2,044
|
(1,371)
|
-
|
(1,765)
|
100
|
136
|
-
|
28
|
(58)
|
9,061
|
Private equity investments
|
294
|
-
|
(45)
|
-
|
-
|
-
|
(2)
|
23
|
34
|
-
|
304
|
Equity cash products
|
73
|
-
|
-
|
-
|
-
|
-
|
2
|
1
|
6
|
(42)
|
40
|
Other
|
5
|
-
|
(1)
|
-
|
(1)
|
-
|
-
|
1
|
-
|
-
|
4
|
Available for sale investments
|
372
|
-
|
(46)
|
-
|
(1)
|
-
|
-
|
25
|
40
|
(42)
|
348
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment property
|
81
|
62
|
-
|
-
|
-
|
-
|
(2)
|
-
|
-
|
-
|
141
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate debt
|
(7)
|
-
|
(4)
|
-
|
1
|
-
|
-
|
-
|
-
|
-
|
(10)
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading portfolio liabilities
|
(7)
|
-
|
(4)
|
-
|
1
|
-
|
-
|
-
|
-
|
-
|
(10)
|
|
|
|
|
|
|
|
|
|
|
|
|
Certificates of deposit,
commercial paper and other
money market instruments
|
(319)
|
-
|
-
|
-
|
-
|
-
|
1
|
-
|
(31)
|
92
|
(257)
|
Issued debt
|
(298)
|
-
|
-
|
-
|
71
|
-
|
-
|
-
|
-
|
-
|
(227)
|
Other
|
(223)
|
-
|
-
|
-
|
27
|
-
|
(3)
|
-
|
-
|
-
|
(199)
|
Financial liabilities
designated at fair value
|
(840)
|
-
|
-
|
-
|
98
|
-
|
(2)
|
-
|
(31)
|
92
|
(683)
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
899
|
27
|
12
|
-
|
15
|
(130)
|
-
|
-
|
419
|
(202)
|
1,040
|
Foreign exchange derivatives
|
81
|
-
|
-
|
-
|
(16)
|
2
|
5
|
-
|
(3)
|
(54)
|
15
|
Credit derivatives
|
1,370
|
-
|
3
|
-
|
(19)
|
(263)
|
-
|
-
|
(71)
|
-
|
1,020
|
Equity derivatives
|
(970)
|
67
|
(222)
|
-
|
11
|
78
|
-
|
-
|
(45)
|
(1)
|
(1,082)
|
Commodity derivatives
|
(5)
|
-
|
-
|
-
|
-
|
3
|
-
|
-
|
-
|
7
|
5
|
Net derivative financial
Instruments
1
|
1,375
|
94
|
(207)
|
-
|
(9)
|
(310)
|
5
|
-
|
300
|
(250)
|
998
|
Assets and liabilities held for sale
|
574
|
-
|
(574)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Total
|
13,567
|
2,742
|
(2,476)
|
-
|
(1,732)
|
(215)
|
137
|
25
|
377
|
(325)
|
12,100
|
|
|
|
|
|
|
|
|
|
|
|
|
Net liabilities held for sale measured at fair value on
non-recurring basis
|
|
|
|
|
|
|
|
|
|
|
(1,339)
|
Total
|
|
|
|
|
|
|
|
|
|
|
10,761
|
1
|
The derivative financial instruments are represented on a net
basis. On a gross basis, derivative financial assets are
£7,872m (H116: £6,771m) and derivative financial
liabilities are £6,874m (H116: £6,306m).
|
Level 3 movement analysis
|
Sales
|
Issues
|
Settlements
|
Total gains and losses in the period recognised in the income
statement
|
Total gains or losses recognised in OCI
|
Transfers
|
As at 30.06.16
|
|
As at 01.01.16
|
Purchases
|
Trading income
|
Other income
|
In
|
Out
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Government and government sponsored debt
|
320
|
-
|
(34)
|
-
|
-
|
(1)
|
-
|
-
|
-
|
-
|
285
|
Corporate debt
|
2,843
|
66
|
(20)
|
-
|
(65)
|
367
|
-
|
-
|
18
|
(11)
|
3,198
|
Non-asset backed loans
|
507
|
116
|
(275)
|
-
|
-
|
(29)
|
-
|
-
|
18
|
(3)
|
334
|
Asset backed securities
|
743
|
56
|
(230)
|
-
|
(12)
|
71
|
-
|
-
|
43
|
-
|
671
|
Funds and fund linked products
|
340
|
-
|
(47)
|
-
|
(286)
|
296
|
-
|
-
|
-
|
(13)
|
290
|
Equity cash products
|
121
|
3
|
(2)
|
-
|
-
|
(1)
|
-
|
-
|
1
|
(32)
|
90
|
Other
|
34
|
4
|
(20)
|
-
|
(68)
|
11
|
-
|
-
|
-
|
(7)
|
(46)
|
Trading portfolio assets
|
4,908
|
245
|
(628)
|
-
|
(431)
|
714
|
-
|
-
|
80
|
(66)
|
4,822
|
Non-asset backed loans
|
15,963
|
-
|
(4)
|
-
|
(8,111)
|
1,695
|
-
|
-
|
82
|
-
|
9,625
|
Commercial real estate loans
|
543
|
785
|
(773)
|
-
|
(10)
|
45
|
-
|
-
|
-
|
-
|
590
|
Private equity investments
|
457
|
21
|
(49)
|
-
|
(1)
|
5
|
85
|
-
|
4
|
-
|
522
|
Equity cash products
|
26
|
-
|
(26)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Other
|
308
|
24
|
(178)
|
-
|
(22)
|
2
|
110
|
-
|
70
|
(38)
|
276
|
Financial assets designated at fair value
|
17,297
|
830
|
(1,030)
|
-
|
(8,144)
|
1,747
|
195
|
-
|
156
|
(38)
|
11,013
|
Private equity investments
|
877
|
11
|
(514)
|
-
|
(9)
|
-
|
3
|
37
|
4
|
(5)
|
404
|
Equity cash products
|
24
|
-
|
(14)
|
-
|
-
|
-
|
3
|
3
|
-
|
(1)
|
15
|
Other
|
20
|
7
|
-
|
-
|
(14)
|
-
|
-
|
1
|
26
|
(1)
|
39
|
Available for sale investments
|
921
|
18
|
(528)
|
-
|
(23)
|
-
|
6
|
41
|
30
|
(7)
|
458
|
Investment property
|
82
|
-
|
-
|
-
|
-
|
-
|
4
|
-
|
-
|
-
|
86
|
Trading portfolio liabilities
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Certificates of deposit, commercial paper and other money market
instruments
|
(272)
|
-
|
-
|
(128)
|
114
|
-
|
(19)
|
-
|
(29)
|
62
|
(272)
|
Issued debt
|
(538)
|
-
|
-
|
(27)
|
203
|
8
|
-
|
-
|
-
|
-
|
(354)
|
Other
|
(244)
|
-
|
-
|
(110)
|
113
|
(26)
|
(2)
|
-
|
(61)
|
38
|
(292)
|
Financial liabilities designated at fair value
|
(1,054)
|
-
|
-
|
(265)
|
430
|
(18)
|
(21)
|
-
|
(90)
|
100
|
(918)
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
418
|
(36)
|
(22)
|
-
|
(179)
|
(77)
|
-
|
-
|
(187)
|
(26)
|
(109)
|
Foreign exchange derivatives
|
(104)
|
-
|
-
|
-
|
(41)
|
11
|
-
|
-
|
20
|
75
|
(39)
|
Credit derivatives
|
1,685
|
10
|
(4)
|
-
|
(12)
|
264
|
-
|
-
|
(3)
|
-
|
1,940
|
Equity derivatives
|
(857)
|
61
|
-
|
(82)
|
53
|
(131)
|
-
|
-
|
(50)
|
26
|
(980)
|
Commodity derivatives
|
(506)
|
5
|
-
|
-
|
48
|
61
|
-
|
-
|
25
|
20
|
(347)
|
Net derivative financial
instruments
1
|
636
|
40
|
(26)
|
(82)
|
(131)
|
128
|
-
|
-
|
(195)
|
95
|
465
|
Assets and liabilities held for sale
|
424
|
12
|
-
|
248
|
(52)
|
-
|
(1)
|
-
|
-
|
-
|
631
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
23,214
|
1,145
|
(2,212)
|
(99)
|
(8,351)
|
2,571
|
183
|
41
|
(19)
|
84
|
16,557
|
Net liabilities held for sale measured at fair value on
non-recurring basis
|
|
|
|
|
|
|
|
|
|
|
(1,732)
|
Total
|
|
|
|
|
|
|
|
|
|
|
14,825
|
1
|
The derivative financial instruments are represented on a net
basis. On a gross basis, derivative financial assets are
£7,872m (H116: £6,771m) and derivative financial
liabilities are £6,874m (H116: £6,306m).
|
Unrealised gains and losses on Level 3 financial assets and
liabilities
The
following table discloses the unrealised gains and losses
recognised in the year arising on Level 3 financial assets and
liabilities held at the period end.
|
Half year ended 30.06.17
|
Half year ended 30.06.16
|
|
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
|
(25)
|
-
|
-
|
(25)
|
400
|
-
|
-
|
400
|
Financial assets designated at fair value
|
73
|
102
|
-
|
175
|
764
|
166
|
-
|
930
|
Available for sale investments
|
-
|
-
|
25
|
25
|
-
|
33
|
41
|
74
|
Investment property
|
-
|
-
|
-
|
-
|
-
|
3
|
-
|
3
|
Financial liabilities designated at fair value
|
45
|
(2)
|
-
|
43
|
(24)
|
(17)
|
-
|
(41)
|
Net derivative financial instruments
|
(305)
|
-
|
-
|
(305)
|
110
|
-
|
-
|
110
|
Assets and Liabilities held for sale
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Total
|
(212)
|
100
|
25
|
(87)
|
1,250
|
185
|
41
|
1,476
|
|
|
|
|
|
|
|
|
|
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 18
Fair
value of financial instruments in the 2016 Annual
Report.
Sensitivity analysis of valuations using unobservable
inputs
|
|
|
|
Fair value
|
Favourable changes
|
Unfavourable changes
|
|
Total
assets
|
Total
liabilities
|
Income
statement
|
Equity
|
Income
statement
|
Equity
|
As at 30.06.17
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Interest rate derivatives
|
5,389
|
(4,349)
|
127
|
-
|
(152)
|
-
|
Foreign exchange derivatives
|
122
|
(107)
|
9
|
-
|
(9)
|
-
|
Credit derivatives
|
1,297
|
(277)
|
128
|
-
|
(117)
|
-
|
Equity derivatives
|
1,059
|
(2,141)
|
160
|
-
|
(160)
|
-
|
Commodity derivatives
|
5
|
-
|
5
|
-
|
(3)
|
-
|
Government and government sponsored debt
|
40
|
-
|
-
|
-
|
-
|
-
|
Corporate debt
|
963
|
(10)
|
4
|
-
|
(4)
|
-
|
Certificates of deposit, commercial paper and other money market
instruments
|
-
|
(257)
|
-
|
-
|
-
|
-
|
Non-asset backed loans
|
7,392
|
-
|
254
|
-
|
(570)
|
-
|
Asset backed securities
|
486
|
-
|
1
|
-
|
(1)
|
-
|
Commercial real estate loans
|
1,127
|
-
|
1
|
-
|
(1)
|
-
|
Issued debt
|
-
|
(227)
|
-
|
-
|
-
|
-
|
Equity cash products
|
130
|
-
|
11
|
23
|
(10)
|
(23)
|
Funds and fund linked products
|
202
|
(9)
|
5
|
-
|
(5)
|
-
|
Private equity investments
|
796
|
(15)
|
90
|
20
|
(90)
|
(20)
|
Assets and liabilities held for sale
|
4,319
|
(5,658)
|
-
|
-
|
-
|
-
|
Other
1
|
659
|
(175)
|
1
|
-
|
-
|
-
|
Total
|
23,986
|
(13,225)
|
796
|
43
|
(1,122)
|
(43)
|
|
|
|
|
|
|
|
As at 31.12.16
|
|
|
|
|
|
|
Interest rate derivatives
|
5,759
|
(4,860)
|
209
|
-
|
(249)
|
-
|
Foreign exchange derivatives
|
132
|
(51)
|
15
|
-
|
(15)
|
-
|
Credit derivatives
|
1,611
|
(241)
|
127
|
-
|
(133)
|
-
|
Equity derivatives
|
1,037
|
(2,007)
|
163
|
-
|
(164)
|
-
|
Commodity derivatives
|
8
|
(13)
|
5
|
-
|
(5)
|
-
|
Government and government sponsored debt
|
3
|
-
|
-
|
-
|
-
|
-
|
Corporate debt
|
969
|
(5)
|
7
|
-
|
(2)
|
-
|
Certificates of deposit, commercial paper and other money market
instruments
|
-
|
(319)
|
-
|
-
|
(1)
|
-
|
Non-asset backed loans
|
8,767
|
-
|
462
|
-
|
(597)
|
-
|
Asset backed securities
|
515
|
-
|
1
|
-
|
(1)
|
-
|
Commercial real estate loans
|
442
|
-
|
2
|
-
|
(2)
|
-
|
Issued debt
|
-
|
(298)
|
-
|
-
|
-
|
-
|
Equity cash products
|
150
|
(2)
|
12
|
26
|
(11)
|
(26)
|
Funds and fund linked products
|
273
|
(37)
|
6
|
-
|
(6)
|
-
|
Private equity investments
|
856
|
(12)
|
104
|
18
|
(104)
|
(21)
|
Assets and liabilities held for sale
|
699
|
(125)
|
3
|
-
|
(3)
|
-
|
Other
1
|
489
|
(173)
|
147
|
-
|
(105)
|
-
|
Total
|
21,710
|
(8,143)
|
1,263
|
44
|
(1,398)
|
(47)
|
1
|
Other includes asset backed loans 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
£0.8bn (December 2016: £1.3bn) or to decrease fair values
by up to £1.2bn (December 2016: £1.4bn) 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 18 Fair value of financial instruments in
the 2016 Annual Report. The description of the significant
unobservable inputs and the sensitivity of fair value measurement
of the instruments categorised as Level 3 assets or liabilities to
increases in significant unobservable inputs is also found in Note
18 Fair value of financial instruments of the 2016 Annual Report.
Assets and liabilities included in disposal groups classified as
held for sale are not included as these are measured at fair value
on a non-recurring basis.
Fair value adjustments
Key
balance sheet valuation adjustments are quantified
below:
|
As at
30.06.17
|
As at
31.12.16
|
|
£m
|
£m
|
Exit price adjustments derived from market bid-offer
spreads
|
(409)
|
(475)
|
Uncollateralised derivative funding
|
(47)
|
(82)
|
Derivative credit valuation adjustments
|
(121)
|
(237)
|
Derivative debit valuation adjustments
|
131
|
242
|
●
|
Exit
price adjustments decreased £66m to £409m primarily due
to tightening in the market bid offer spreads
|
●
|
Uncollateralised
derivative funding decreased
£35m to £47m as a result
of tightening in funding spreads and unwinds of derivative
exposures
|
●
|
Credit
Valuation Adjustments (CVA)
decreased £116m to £121m
as a result of tightening in credit spreads and unwinds of
derivative exposures
|
●
|
Debit
Valuation Adjustments
(DVA)
decreased £111m to
£131m
as a result of
tightening in 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 £120m (2016:
£179m). There are additions of £14m (2016: £29m) and
£73m (2016: £37m) of amortisation and
releases.
Third party credit enhancements
Structured
and brokered certificates of deposit issued by Barclays Group are
insured up to $250,000 per depositor by the Federal Deposit
Insurance Corporation (FDIC) in the United States. The FDIC is
funded by premiums that Barclays and other banks pay for deposit
insurance coverage. The carrying value of these issued certificates
of deposit that are designated under the IAS 39 fair value option
includes this third party credit enhancement. The on balance sheet
value of these brokered certificates of deposit amounted to
£3,203m (December 2016: £3,905m).
Comparison of carrying amounts and fair values for assets and
liabilities not held at fair value
Valuation
methodologies employed in calculating the fair value of financial
assets and liabilities measured at amortised cost are consistent
with the 2016 Annual Report disclosure.
The
following table summarises the fair value of financial assets and
liabilities measured at amortised cost on the Group’s balance
sheet:
|
As at 30.06.17
|
As at 31.12.16
|
|
Carrying amount
|
Fair Value
|
Carrying amount
|
Fair Value
|
Financial assets
|
£m
|
£m
|
£m
|
£m
|
Held to maturity
|
5,142
|
5,228
|
5,176
|
5,347
|
Loans and advances to banks
|
37,108
|
37,101
|
43,251
|
43,228
|
Loans and advances to customers:
|
|
|
|
|
-Home loans
|
144,706
|
142,212
|
144,765
|
141,155
|
-Credit cards, unsecured and other retail lending
|
55,423
|
55,347
|
57,808
|
57,699
|
-Finance lease receivables
|
1,554
|
1,554
|
1,602
|
1,598
|
-Corporate loans
|
188,321
|
187,261
|
188,609
|
186,715
|
Reverse repurchase agreements and other similar secured
lending
|
17,209
|
17,209
|
13,454
|
13,454
|
Assets included in disposal groups classified as held for
sale
1
|
-
|
-
|
43,593
|
44,838
|
|
|
|
|
|
Financial liabilities
|
|
|
|
|
Deposits from banks
|
(48,887)
|
(48,887)
|
(48,214)
|
(48,212)
|
Customer accounts:
|
|
|
|
|
-Current and demand accounts
|
(140,614)
|
(140,614)
|
(138,204)
|
(138,197)
|
-Savings accounts
|
(133,219)
|
(133,223)
|
(133,344)
|
(133,370)
|
-Other time deposits
|
(163,029)
|
(163,029)
|
(151,630)
|
(151,632)
|
Debt securities in issue
|
(76,664)
|
(78,289)
|
(75,932)
|
(76,971)
|
Repurchase agreements and other similar secured
borrowing
|
(38,578)
|
(38,578)
|
(19,760)
|
(19,760)
|
Subordinated liabilities
|
(23,879)
|
(25,419)
|
(23,383)
|
(24,547)
|
Liabilities included in disposal groups classified as held for
sale
1
|
-
|
-
|
(51,775)
|
(51,788)
|
1
|
Disposal groups held for sale and measured at fair value less cost
to sell are included in the fair value table. For disposal groups
measured at carrying amount, the underlying financial assets and
liabilities measured at fair value are included in the fair value
disclosures on page 83-90 and items measured at amortised costs are
included on page 91.
|
12.
Subordinated liabilities
|
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
|
£m
|
£m
|
Opening balance as at 1 January
|
23,383
|
21,467
|
Issuances
|
1,547
|
1,457
|
Redemptions
|
(140)
|
(1,142)
|
Other
|
(911)
|
1,601
|
Total dated and undated subordinated liabilities as at period
end
|
23,879
|
23,383
|
Subordinated
liabilities increased 2% to £23,879m (December 2016:
£23,383m). There was one issuance of 4.836% Fixed Rate
Subordinated Notes of £1,547m. Redemptions totalling
£140m include £133m 6.375% Undated Subordinated Notes.
Other movements of £911m decreased largely due to the
appreciation of GBP against USD and JPY.
13.
Provisions
|
|
|
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
|
£m
|
£m
|
UK Customer Redress
|
|
|
Payment Protection Insurance redress
|
2,109
|
1,979
|
Other customer redress
|
543
|
712
|
Legal, competition and regulatory matters
|
351
|
455
|
Redundancy and restructuring
|
154
|
206
|
Undrawn contractually committed facilities and
guarantees
|
66
|
67
|
Onerous contracts
|
279
|
385
|
Sundry provisions
|
428
|
330
|
Total
|
3,930
|
4,134
|
Payment Protection Insurance Redress
As at
30 June 2017, Barclays had recognised cumulative provisions
totalling £9.1bn (December 2016: £8.4bn) against the cost
of Payment Protection Insurance (PPI) redress and associated
processing costs with utilisation of £7.0bn (December 2016:
£6.5bn), leaving a residual provision of £2.1bn (December
2016: £2.0bn).
Through
to 30 June 2017, 2.0m (December 2016: 1.8m) customer initiated
claims
1
had been received and processed. The volume of claims received
during H117 increased 32%
2
from H216 (increased
by 15% from H116).
The
current provision reflects the estimate of costs of PPI redress
primarily relating to customer initiated complaints and on-going
remediation programmes. This also includes liabilities managed by
third parties arising from portfolios previously sold where
Barclays remains liable.
An
additional charge of £0.7bn has been recognised to reflect an
updated estimated cost of PPI redress, primarily relating to an
increase in expected future volume of claims.
As at
30 June 2017, the provision of £2.1bn represents
Barclays’ best estimate of expected PPI redress. However, it
is possible the eventual outcome may differ from the current
estimate. We will continue to review the adequacy of provision
level in respect of the on-going level of complaints. The FCA
marketing campaign commences on 29 August 2017 covering the period
until the FCA’s deadline for the bringing the claims in
August 2019. The impact of the marketing campaign on
Barclays’ provision is uncertain but has been considered in
Barclays’ provision estimate.
The PPI
provision is calculated using a number of key assumptions which
continue to involve significant management judgement and
modelling:
●
|
Customer
initiated claim volumes – claims received but not yet
processed plus an estimate of future claims initiated by customers
where the volume is anticipated to cease after August
2019
|
●
|
Average
claim redress – the expected average payment to customers for
upheld claims based on the type and age of the
policy/policies
|
●
|
Processing
cost per claim – the cost to Barclays of assessing and
processing each valid claim
|
These
assumptions remain subjective, in particular due to the uncertainty
associated with future claims levels, which include complaints
driven by CMC activity.
The
current provision represents Barclays’ revised best estimate
of all future expected costs of PPI redress based on the
information available at the end of H117.
The
following table details actual data through to 30 June 2017, key
forecast assumptions used in the provision calculation and a
sensitivity analysis illustrating the impact on the provision if
the future expected assumptions prove too high or too
low.
Assumption
|
Cumulative
actual to
30.06.17
|
Future
expected
|
Sensitivity analysis increase/decrease
in provision
|
Customer
initiated claims received and processed
1
|
2,000k
|
740k
|
50k =
£105m
|
Average
uphold rate per claim
3
|
87%
|
87%
|
1% =
£17m
|
Average
redress per valid claim
4
|
£2,268
|
£1,932
|
£100
= £77m
|
Processing
cost per claim
5
|
£386
|
£283
|
£10
= £7m
|
1
|
Total claims received directly by Barclays to date, including those
received via CMCs but excluding those for which no PPI policy
exists and excluding responses to proactive mailing.
|
2
|
Gross volumes received including no PPI.
|
3
|
Average uphold rate per customer initiated claims received directly
by Barclays and proactive mailings, excluding those for which no
PPI policy exists.
|
4
|
Average redress stated on a per policy basis for future customer
initiated complaints received directly by Barclays and proactive
mailings.
|
5
|
Processing cost per claim is based on customer initiated claims
received and processed.
|
14.
Retirement benefits
As at
30 June 2017, the Group’s IAS19 pension surplus across all
schemes was £0.4bn (December 2016: £0.4bn deficit). The
UK Retirement Fund (UKRF), which is the Group’s main scheme,
had a surplus of £0.7bn (December 2016: £27m deficit).
The movement for the UKRF was driven by payment of deficit
reduction contributions over the last six months, with changes in
market conditions largely being neutral.
Triennial valuation
The
latest triennial actuarial valuation of the UKRF with an effective
date of 30 September 2016 has been completed. This valuation showed
a funding deficit of £7.9bn and a funding level of 81.5%,
versus £6.0bn funding deficit at the 30 September 2015 update.
The increase in funding deficit over that period was mainly driven
by the increase in liabilities due to changes in financial
conditions, namely from falls in gilt yields and the lower outlook
for future investment returns, offset by favourable asset returns
over the year and payment of deficit reduction
contributions.
The
Bank and UKRF Trustee have agreed a revised scheme-specific funding
target, statement of funding principles, schedule of contributions,
a recovery plan to seek to eliminate the deficit relative to the
funding target and some additional support measures. The agreement
with the UKRF Trustee also takes into account the changes to the
Group structure that will be implemented as a result of
ring-fencing
1
. The UKRF will
remain in Barclays Bank PLC (BBPLC).
The
main differences between the funding and IAS 19 assumptions were a
different approach to setting the discount rate and a more
conservative longevity assumption for funding.
The
deficit reduction contributions agreed with the UKRF Trustee as
part of the 30 September 2016 valuation recovery plan are shown
alongside the deficit recovery contributions agreed in 2014 for the
prior 30 September 2013 valuation.
Year
|
Deficit contributions 30 September 2016 valuation
£
|
Deficit contributions30 September 2013 valuation
£m
|
2017
|
740
2
|
1,240
3
|
2018
|
500
|
740
|
2019
|
500
|
740
|
2020
|
500
|
740
|
2021
|
1,000
|
240
3
|
2022 to
2026
|
1,000
each year
|
-
|
|
|
|
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. The next funding valuation of the
UKRF is due to be completed in 2020 with an effective date of 30
September 2019.
Other measures agreed at the same time as the
Valuation
Collateral
- The UKRF Trustee and BBPLC have entered into an arrangement
whereby a collateral pool has been put in place to provide security
for 88.5% of the UKRF funding deficit as it increases or decreases
over time, and associated deficit recovery contributions, with a
cap of £9.0bn. The collateral pool is currently made up of
government securities and high quality securitisations of credit
cards, mortgages and corporate loans. The arrangement provides the
UKRF Trustee with dedicated access to the pool of assets in the
event of BBPLC not paying a deficit reduction contribution to the
UKRF or in the event of BBPLC’s insolvency.
Support
from Barclays PLC (BPLC) - In the event of BBPLC not paying a
deficit reduction contribution payment required under the 2016
valuation recovery plan by a specified pre-payment date, BPLC has
entered into an arrangement whereby it will be required to use, in
first priority, dividends received from the UK Ring-Fenced Bank
(RFB) (if any) to invest the proceeds in BBPLC (up to the maximum
amount of the deficit reduction contribution unpaid by BBPLC). The
proceeds of the investment will be used to discharge BBPLC’s
unpaid deficit reduction contribution.
Participation
- As permitted under the Financial Services and Markets Act 2000
(Banking Reform) (Pensions) Regulations 2015, RFB will participate
as an employer in the UKRF during a transitional phase until the
end of 2025. RFB will make contributions for the future service of
its employees who are currently Afterwork members and, in the event
of BBPLC's insolvency during this period, RFB would step in as
principal employer of the UKRF.
1
|
Refer to page 236 of the Barclays PLC 2016 Annual Report for
further information on structural reform.
|
2
|
£620m of the £740m for 2017 had been paid to the UKRF by
30 June 2017.
|
3
|
The 2017 contribution included up to £500m payable if the
deficit in 2017 exceeded a certain level. If it was paid, the
additional amount would be deducted from the 2021 payment
due.
|
15.
Called up share capital
Called
up share capital comprises 17,034m (December 2016: 16,963m)
ordinary shares of 25p each. The increase was largely due to the
issuance of shares under employee share schemes and the Barclays
PLC Scrip Dividend Programme.
16.
Other equity instruments
Other equity instruments of £7,694m (December 2016:
£6,449m) include Additional Tier 1 (AT1) securities issued by
Barclays PLC. The increase was primarily due to the issuance of a
GBP AT1 security, with a principal amount of
£1,250m.
The AT1 securities are perpetual securities with no fixed maturity
and are structured to qualify as AT1 instruments under CRD
IV.
17.
Other reserves
|
|
|
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
|
£m
|
£m
|
Currency translation reserve
|
3,756
|
3,051
|
Available for sale reserve
|
(16)
|
(74)
|
Cash flow hedging reserve
|
1,578
|
2,105
|
Own credit reserve
|
(153)
|
-
|
Other
|
983
|
969
|
Total
|
6,148
|
6,051
|
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 2017, there was a credit balance of £3,756m (December
2016: £3,051m credit) in the currency translation reserve. The
£705m credit movement principally reflected the £1,377m
credit movement driven by recycling of the accumulated currency
translation losses into the income statement resulting from the
partial disposal of BAGL. This credit movement was partially offset
by debit movements driven by the weakening of USD against
GBP.
Available for sale reserve
The
available for sale reserve represents the unrealised change in the
fair value of available for sale investments since initial
recognition.
As at
30 June 2017, there was a debit balance of £16m (December
2016: £74m debit) in the available for sale reserve. The
increase of £58m (2016: £391m decrease) was primarily due
to £218m of net gains from changes in fair value on Government
Bonds predominantly held in the liquidity pool and the related
hedging. There were also £165m of net gains transferred to net
profit and a tax charge of £49m was recognised in the period
relating to these items.
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 2017, there was a credit balance of £1,578m (December
2016: £2,105m credit) in the cash flow hedging reserve. The
decrease of £527m (2016: £844m increase) principally
reflected a £413m decrease in the fair value of interest rate
swaps held for hedging purposes as interest rate forward curves
increased and £321m gains transferred to net profit, partially
offset by a tax credit of £205m.
Own credit reserve
As a
result of the early adoption of the own credit provisions of IFRS 9
on 1 January 2017, own credit which was previously recorded in the
income statement is now recognised within other comprehensive
income. Changes in own credit in respect of debt instruments are
recognised at fair value through the income statement.
As at
30 June 2017, the amount of own credit recognised in the
Group’s other comprehensive income was a debit balance of
£153m (December 2016: £nil). Upon adoption of IFRS 9, an
opening debit balance of £175m was recognised. The
increase of £22m (2016: £nil) principally reflected
amortisation movements of £32m and a widening of Barclays
own credit spreads of £6m, partially offset by tax of
£13m and foreign exchange of £3m.
Other reserves and treasury shares
As at 30 June 2017, there was a credit balance of £1,011m
(December 2016: £1,011m credit) in other reserves relating to
redeemed ordinary and preference shares issued by the
Group.
There was a debit balance of £28m (December 2016: £42m
debit) in other reserves relating to treasury shares. During the
period £294m (2016: £140m) net purchases of treasury
shares were made, principally reflecting the increase in shares
held for the purposes of employee share schemes, and £308m
(2016: £166m) was transferred to retained earnings reflecting
the vesting of deferred share based payments.
18.
Contingent liabilities and
commitments
|
|
|
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
|
£m
|
£m
|
Guarantees and letters of credit pledged as collateral
security
|
15,971
|
15,303
|
Performance guarantees, acceptances and endorsements
|
4,664
|
4,636
|
Total contingent liabilities
|
20,635
|
19,939
|
|
|
|
Documentary credits and other short-term trade related
transactions
|
966
|
1,005
|
Forward starting reverse repurchase agreements
|
133
|
24
|
Standby facilities, credit lines and other commitments
|
297,339
|
302,657
|
Total commitments
|
298,438
|
303,686
|
Further
details on contingent liabilities relating to legal, competition
and regulatory matters can be found in Note 19
.
19.
Legal, competition and regulatory
matters
Barclays
PLC, Barclays Bank PLC and the Group face legal, competition and
regulatory challenges, many of which are beyond our control. The
extent of the impact on Barclays PLC, Barclays Bank PLC and the
Group 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 Group has
not disclosed an estimate of the potential financial effect on the
Group of contingent liabilities where it is not currently
practicable to do so.
Investigations into certain advisory services agreements and other
matters and civil action
The UK
Serious Fraud Office (SFO), the Financial Conduct Authority (FCA),
the US Department of Justice (DOJ) and the US Securities and
Exchange Commission (SEC) have been conducting investigations into
certain advisory services agreements entered into by Barclays Bank
PLC.
Background Information
Barclays
Bank PLC entered into two advisory services agreements with Qatar
Holding LLC (Qatar Holding) in June and October 2008 (the
Agreements). The FCA commenced an investigation into whether the
Agreements may have related to Barclays PLC’s capital
raisings in June and November 2008 (the Capital Raisings). The
existence of the June 2008 advisory services agreement was
disclosed, but the entry into the advisory services agreement in
October 2008 and the fees payable under the Agreements, which
amounted to a total of £322m payable over a period of five
years, were not disclosed in the announcements or public documents
relating to the Capital Raisings. The SFO also commenced an
investigation into the Agreements and into a $3bn loan (the Loan)
provided by Barclays Bank PLC in November 2008 to the State of
Qatar.
SFO Proceedings
In June
2017, the SFO charged Barclays PLC with two offences of conspiring
with certain former senior officers and employees of Barclays to
commit fraud by false representations relating to the Agreements
and one offence of unlawful financial assistance contrary to
section 151 of the Companies Act 1985 in relation to the Loan (the
Charges). The SFO has informed Barclays that it has not made a
decision as to whether it will also bring a charge against Barclays
Bank PLC in respect of the Loan. The trial of the Charges has been
scheduled to begin in January 2019.
FCA Proceedings and other investigations
In
September 2013, the FCA issued warning notices (the Notices)
finding that while, Barclays PLC and Barclays Bank PLC believed at
the time of the execution of the Agreements that there should be at
least some unspecified and undetermined value to be derived from
them, the primary purpose of the Agreements was not to obtain
advisory services but to make additional payments, which would not
be disclosed, for the Qatari participation in the Capital Raisings.
The Notices concluded that Barclays PLC and Barclays Bank PLC were
in breach of certain disclosure-related listing rules and Barclays
PLC was also in breach of Listing Principle 3 (the requirement to
act with integrity towards holders and potential holders of the
Company’s shares). In this regard, the FCA considers that
Barclays PLC and Barclays Bank PLC acted recklessly. The financial
penalty provided in the Notices against the Group is £50m.
Barclays PLC and Barclays Bank PLC continue to contest the
findings. A stay of the FCA action has been lifted. It is possible
that the stay may be reimposed due to the SFO
proceedings.
In
addition, the DOJ and the SEC have been conducting investigations
relating to the Agreements.
Civil Action
In
January 2016, PCP Capital Partners LLP and PCP International
Finance Limited (PCP) served a claim on Barclays Bank PLC seeking
damages of £721.4m plus interest and costs for fraudulent
misrepresentation and deceit, arising from alleged statements made
by Barclays Bank PLC to PCP in relation to the terms on which
securities were to be issued to potential investors, allegedly
including PCP, in the November 2008 capital raising. Barclays Bank
PLC is defending the claim.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect that
they might have upon the Group’s operating results, cash
flows or financial position in any particular period. PCP has made
a claim against Barclays Bank PLC totalling £721.4m plus
interest and costs. This amount does not necessarily reflect
Barclays Bank PLC’s potential financial exposure if a ruling
were to be made against it in that matter.
Investigations into certain business relationships
In
2012, the DOJ and SEC commenced investigations in relation to
whether certain relationships with third parties who assist
Barclays PLC to win or retain business are compliant with the US
Foreign Corrupt Practices Act. Various regulators in other
jurisdictions are also being briefed on the investigations.
Separately, the Group is cooperating with the DOJ and SEC in
relation to an investigation into certain of its hiring practices
in Asia and elsewhere and is keeping certain regulators in other
jurisdictions informed.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect that
they might have upon the Group’s operating results, cash
flows or financial position in any particular period.
Investigations relating to whistleblowing systems and
controls
The FCA
and PRA are conducting investigations in relation to the Group
Chief Executive Officer (CEO) and Barclays Bank PLC in connection
with certain whistleblowing issues.
Background Information
In
April 2017, the FCA and PRA commenced investigations into the CEO
as to his individual conduct and senior manager responsibilities
relating to Barclays’ whistleblowing programme and to his
attempt in 2016 to identify the author of a letter that was treated
by Barclays Bank PLC as a whistleblow; and Barclays Bank PLC, as to
its responsibilities relating to the attempt by the CEO to identify
the author of the letter, as well as Barclays’ systems and
controls and culture relating to whistleblowing.
The
attempt to identify the author of the letter first came to the
attention of the Barclays PLC Board (Board) early in 2017. The
Board instructed an external law firm to conduct a focussed
investigation into the matter and also notified the FCA and PRA and
other relevant authorities. The investigation found, and the Board
concluded, that the CEO honestly, but mistakenly, believed that it
was permissible to identify the author. However, the Board
concluded that the CEO made an error in becoming involved with, and
not applying appropriate governance around the matter, and in
taking action to attempt to identify the author of the letter. The
Board has commissioned independent reviews of Barclay’s
relevant processes and controls, including its whistleblowing
programme.
Barclays
and the CEO are cooperating fully with the FCA and PRA
investigations. Barclays is also providing information to, and
cooperating with, authorities in the United States with respect to
these matters.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect that
they might have upon the Group’s operating results, cash
flows or financial position in any particular period.
Investigation relating to retail structured deposits
The FCA
has been conducting an enforcement investigation in relation to
structured deposits provided by Barclays Bank PLC and Woolwich Plan
Managers Limited, a wholly owned subsidiary of Barclays Bank
PLC.
Background Information
In
2015, the FCA commenced an enforcement investigation into the
design, manufacture and sale of structured deposit products by
Barclays from November 2009 to the present.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the action described on the Group or what effect that it
might have upon the Group’s operating results, cash flows or
financial position in any particular period.
Investigation into Americas Wealth & Investment Management
advisory business
The SEC
has carried out an investigation into certain practices in
Barclays' former Wealth Americas investment advisory business
relating to certain due diligence failures, fee and billing
practices and mutual fund fee waivers and related disclosures. In
May 2017, the SEC announced a settlement pursuant to which Barclays
Capital Inc. (BCI) agreed to resolve this matter for US$97m,
consisting of a penalty of US$30m (to be paid to the SEC) and
US$67m (to be paid to the clients) in remediation and
disgorgement.
Investigation into suspected money laundering related to foreign
exchange transactions in South African operation
Absa
Bank Limited, a subsidiary of Barclays Africa Group Limited,
identified potentially fraudulent activity by certain of its
customers using advance payments for imports in 2014 and 2015 to
effect foreign exchange transfers from South Africa to beneficiary
accounts located in East Asia, UK, Europe and the US. As a result,
the Group conducted a review of relevant activity, processes,
systems and controls. The Group is continuing to provide
information to relevant authorities as part of the Group’s
ongoing cooperation.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect that
they might have upon the Group’s operating results, cash
flows or financial position in any particular period.
Investigations into LIBOR and other benchmarks
Regulators
and law enforcement agencies, including certain competition
authorities, from a number of governments have been conducting
investigations relating to Barclays Bank PLC’s involvement in
manipulating certain financial benchmarks, such as LIBOR and
EURIBOR.
Background Information
In
2012, Barclays Bank PLC announced that it had reached settlements
with the Financial Services Authority (FSA) (as predecessor to the
FCA), the US Commodity Futures Trading Commission (CFTC) and the
DOJ in relation to their investigations concerning certain
benchmark interest rate submissions, and Barclays Bank PLC paid
total penalties of £290m. The settlement with the DOJ was made
by entry into a Non-Prosecution Agreement (NPA) which has now
expired. Barclays PLC, Barclays Bank PLC and BCI have reached
settlements with certain other regulators and law enforcement
agencies. Barclays Bank PLC continues to respond to requests for
information from the SFO in relation to its ongoing LIBOR
investigation, including in respect of Barclays Bank PLC. The
investigation by the prosecutor’s office in Trani, Italy also
remains pending.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect that
they might have upon the Group’s operating results, cash
flows or financial position in any particular period.
LIBOR and other benchmark civil actions
A
number of individuals and corporates in a range of jurisdictions
have threatened or brought civil actions against the Group and
other banks in relation to LIBOR and/or other
benchmarks.
Background Information
Following
settlement of the investigations referred to above in
‘Investigations into LIBOR and other Benchmarks’
various individuals and corporates in a range of jurisdictions have
threatened or brought civil actions against the Group. While
certain cases have been dismissed or settled subject to approval
from the court (and in the case of class actions, the right of
class members to opt-out of the settlement and to seek to file
their own claims), other actions remain pending and their ultimate
impact is unclear.
USD LIBOR Cases in MDL Court
The
majority of the USD LIBOR cases, which have been filed in various
US jurisdictions, have been consolidated for pre-trial purposes
before a single judge in the SDNY (MDL Court).
The
complaints are substantially similar and allege, amongst other
things, that Barclays Bank PLC and the other banks 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) and
various state laws by manipulating USD LIBOR rates.
The
proposed class actions purported to be brought on behalf of
(amongst others) plaintiffs that (i) engaged in USD LIBOR-linked
over-the-counter transactions (OTC Class); (ii) purchased USD
LIBOR-linked financial instruments on an exchange (Exchange-Based
Class); (iii) purchased USD LIBOR-linked debt securities (Debt
Securities Class); (iv) purchased adjustable-rate mortgages
linked to USD LIBOR (Homeowner Class); or (v) issued loans linked
to USD LIBOR (Lender Class).
The
lawsuits seek unspecified damages with the exception of five
lawsuits, in which the plaintiffs are seeking a combined total in
excess of $1.25bn in actual damages against all defendants,
including Barclays Bank PLC, plus punitive damages. Some of the
lawsuits also seek trebling of damages under the Antitrust Act and
RICO.
Between
2013 and 2016, the MDL Court issued a series of decisions
effectively dismissing the majority of claims, including antitrust
claims, against Barclays Bank PLC and other foreign defendants in
both class actions and individual actions. In May 2016, the appeal
court reversed the MDL Court’s holding that plaintiffs in
certain class actions and individual actions had not suffered an
antitrust injury and remanded the antitrust claims to the MDL Court
for further consideration. Following further consideration, the MDL
Court dismissed the majority of antitrust claims against foreign
defendants, including Barclays Bank PLC, for lack of personal
jurisdiction. Plaintiffs in a number of individual actions and
class actions are appealing the MDL Court’s personal
jurisdiction ruling.
In
2014, the MDL Court granted preliminary approval for the settlement
of the Exchange-Based Class claims for $20m, of which $5m was paid.
The balance of the settlement amount will be paid following final
approval of the settlement by the court. Final approval of the
settlement is awaiting plaintiff’s submission of a plan for
allocation of the settlement proceeds acceptable to the MDL Court
and will be subject to the right of class members to opt-out of the
settlement and to seek to file their own claims.
In
2015, the OTC Class claims were settled for $120m. The settlement
was preliminarily approved by the MDL court in December 2016 but
remains subject to final approval and the right of class members to
opt-out of the settlement and to seek to file their own claims.
Payment of $120m was made in June 2017.
In
November 2016, $7.1m was paid in settlement of the Debt Securities
Class claims. The settlement has been preliminarily approved by the
court but remains subject to final approval and the right of class
members to opt-out of the settlement and seek to file their own
claims.
EURIBOR Case in the SDNY
In
2015, $94m was paid in settlement of a EURIBOR-related class
action. The settlement has been preliminarily approved by the court
but remains subject to final approval and the right of class
members to opt-out of the settlement and to seek to file their own
claims.
Additional USD LIBOR Case in the SDNY
In
2015, an individual action against Barclays Bank PLC and other
panel bank defendants was dismissed by the SDNY. The plaintiff
alleged that the panel bank defendants conspired to increase USD
LIBOR, which caused the value of bonds pledged as collateral for a
loan to decrease, ultimately resulting in the sale of the bonds at
a low point in the market. The plaintiff’s motion to file a
further amended complaint is pending.
Sterling LIBOR Case in SDNY
In
2015, a putative class action was filed in the SDNY against
Barclays Bank PLC and other Sterling LIBOR panel banks by a
plaintiff involved in exchange-traded and over-the-counter
derivatives that were linked to Sterling LIBOR. The complaint
alleges, among other things, that defendants manipulated the
Sterling LIBOR rate between 2005 and 2010 and, in so doing,
committed CEA, Antitrust Act, and RICO violations. In early 2016,
this class action was consolidated with an additional putative
class action making similar allegations against Barclays Bank PLC
and BCI and other Sterling LIBOR panel banks. Defendants have filed
a motion to dismiss.
Japanese Yen LIBOR Cases in SDNY
In
2012, a putative class action was filed in the SDNY against
Barclays Bank PLC and other Japanese Yen LIBOR panel banks by a
plaintiff involved in exchange-traded derivatives. The complaint
also names members of the Japanese Bankers Association’s
Euroyen Tokyo Interbank Offered Rate (Euroyen TIBOR) panel, of
which Barclays Bank PLC is not a member. The complaint alleges,
amongst other things, manipulation of the Euroyen TIBOR and Yen
LIBOR rates and breaches of the CEA and Antitrust Act between 2006
and 2010. In 2014, the court dismissed the plaintiff’s
antitrust claims in full, but sustained the plaintiff’s CEA
claims, which are pending. Discovery is ongoing.
In
March 2017, a second putative class action concerning Yen LIBOR
filed in the SDNY against Barclays PLC, Barclays Bank PLC and BCI
was dismissed in full. The complaint makes similar allegations to
the 2012 class action. Plaintiffs have appealed the
dismissal.
SIBOR/SOR Case in the SDNY
A
putative class action 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) was dismissed by the court in relation to claims
against Barclays for failure to state a claim. The court indicated
that plaintiffs will be allowed to amend their
complaint.
Non-US Benchmarks Cases
In
addition to US actions, legal proceedings have been brought or
threatened against the Group in connection with alleged
manipulation of LIBOR and EURIBOR in a number of jurisdictions. The
number of such proceedings in non-US jurisdictions, the benchmarks
to which they relate and the jurisdictions in which they may be
brought have increased over time.
Claimed Amounts/Financial Impact
Aside
from the settlements discussed above, it is not currently
practicable to provide an estimate of the financial impact of the
actions described on the Group or what effect that they might have
upon the Group’s operating results, cash flows or financial
position in any particular period.
Foreign Exchange investigations
Various
regulatory and enforcement authorities across multiple
jurisdictions have been investigating a range of issues associated
with Foreign Exchange sales and trading, including electronic
trading.
Background Information
In 2015
the Group reached settlements with the CFTC, the DOJ, the New York
State Department of Financial Services (NYDFS), the Board of
Governors of the Federal Reserve System (Federal Reserve) and the
FCA (together, the 2015 Resolving Authorities) in relation to
investigations into certain sales and trading practices in the
Foreign Exchange market. In connection with these settlements, the
Group paid total penalties of approximately $2.38bn and agreed to
undertake certain remedial actions.
Under
the plea agreement with the DOJ, in addition to a criminal fine,
Barclays PLC agreed to a term of probation of three years during
which Barclays PLC must, amongst other things, (i) commit no crime
whatsoever in violation of the federal laws of the United States,
(ii) implement and continue to implement a compliance program
designed to prevent and detect the conduct that gave rise to the
plea agreement and agreement, (iii) report credible allegations of
violations of US antitrust or fraud laws to the relevant U.S.
authority, and (iv) strengthen its compliance and internal controls
as required by relevant regulatory or enforcement agencies. In
January 2017, the US District Court for the District of Connecticut
accepted the plea agreement and in accordance with the agreement
sentenced Barclays PLC to pay $650m as a fine and $60m for
violating the NPA (which amounts are part of the $2.38bn referred
to above) and to serve three years of probation from the date of
the sentencing order. The Group also continues to provide relevant
information to certain of the 2015 Resolving
Authorities.
The
full text of the DOJ plea agreement, the orders of the CFTC, NYDFS
and Federal Reserve, and the Final Notice issued by the FCA related
to the settlements referred to above are publicly available on the
2015 Resolving Authorities’ respective websites.
The
European Commission (Commission) is one of several authorities
conducting an investigation into certain trading practices in the
Foreign Exchange market.
The DOJ
is also conducting an investigation into conduct relating to
certain trading activities in connection with certain transactions
during 2011 and 2012. Barclays is providing information to the DOJ
and other relevant authorities reviewing this conduct.
In
February 2017 the South African Competition Commission (SACC)
referred Barclays Bank PLC, BCI and Absa Bank Limited, a subsidiary
of Barclays Africa Group Limited, among other banks, to the
Competition Tribunal to be prosecuted for breaches of South African
antitrust law related to Foreign Exchange trading of South African
Rand. The SACC found from its investigation that between 2007 and
2013 the banks had engaged in various forms of collusive behaviour.
Barclays was the first to bring the conduct to the attention of the
SACC under its leniency programme and has cooperated with, and will
continue to cooperate with, the SACC in relation to this matter.
The SACC is therefore not seeking an order from the Tribunal to
impose any fine on Barclays Bank PLC, BCI or Absa Bank
Limited.
Claimed Amounts/Financial Impact
Aside
from the settlements discussed above, it is not currently
practicable to provide an estimate of any further financial impact
of the actions described on the Group or what effect they might
have on the Group’s operating results, cash flows or
financial position in any particular period.
Civil actions in respect of Foreign Exchange
A
number of individuals and corporates in a range of jurisdictions
have threatened or brought civil actions against the Group and
other banks in relation to Foreign Exchange.
Background Information
Following
settlement of certain investigations referred to above in
‘Foreign Exchange Investigations’ a number of
individuals and corporates in a range of jurisdictions have
threatened or brought civil actions against the Group and other
banks in relation to Foreign Exchange or may do so in future.
Certain of these cases have been dismissed or have been settled
subject to final approval from the relevant court (and in the case
of class actions, the right of class members to opt-out of the
settlement and to seek to file their own claims).
Consolidated FX Action
In
2014, a number of civil actions filed in the SDNY on behalf of
proposed classes of plaintiffs alleging manipulation of Foreign
Exchange markets under the Antitrust Act and New York state law and
naming several international banks as defendants, including
Barclays Bank PLC, were combined into a single consolidated action
(Consolidated FX Action). In
2015, Barclays Bank PLC and BCI
settled the Consolidated FX Action and paid $384m. The settlement
itself is subject to final court approval and the right of class
members to opt-out of the settlement and to seek to file their own
claims.
ERISA FX Action
Since
2015, several civil actions have been filed in the SDNY on behalf
of proposed classes of plaintiffs purporting to allege different
legal theories of injury (other than those alleged in the
Consolidated FX Action) related to alleged manipulation of Foreign
Exchange rates and naming several international banks as
defendants, including Barclays PLC, Barclays Bank PLC and BCI. One
such consolidated action asserts claims under the US Employee
Retirement Income Security Act (ERISA) statute (ERISA Claims) and
includes allegations of conduct that are duplicative of allegations
in the other cases, as well as additional allegations about ERISA
plans. The Court ruled that the ERISA allegations concerning
collusive manipulation of FX rates are covered by the settlement
agreement in the Consolidated FX Action, but did not rule on
whether allegations characterised by the ERISA plaintiffs as
non-collusive manipulation of FX rates are likewise covered by the
agreement. In September 2016, the Court dismissed all ERISA Claims
(based on both alleged collusive and non-collusive conduct) against
Barclays and all other defendants as a matter of law. The
ERISA
plaintiffs have
appealed this decision.
Retail Basis Action
A
putative action was filed in the Northern District of California
(and subsequently transferred to the SDNY) against several
international banks, including Barclays PLC and BCI, on behalf of a
putative class of individuals that exchanged currencies on a retail
basis at bank branches (Retail Basis Claims). The Court has ruled
that the Retail Basis Claims are not covered by the settlement
agreement in the Consolidated FX Action. The Court subsequently
dismissed all Retail Basis Claims against Barclays and all other
defendants. Plaintiffs have requested the Court’s permission
to file an amended complaint.
Last Look Actions
In
2015, two putative class actions were filed in the SDNY on behalf
of proposed classes of plaintiffs alleging injuries based on
Barclays’ purported improper rejection of customer trades
through Barclays Last Look functionality in Barclays’ FX
e-trading platforms In 2016, Barclays Bank PLC and BCI paid $50m
and settled one of the actions on a class-wide basis. (The other
action was voluntarily dismissed.) The deadline for opting out of
the class has expired (a small number of class members have opted
out), but the Court has not yet granted final approval of the
settlement.
State Law FX Action
In
2016, a putative class action was filed in the SDNY under federal,
New York and California law on behalf of proposed classes of
stockholders of Exchange Traded Funds and others who supposedly
were indirect investors in FX Instruments. The defendants
(including Barclays) moved to dismiss the action. Plaintiffs also
filed a complaint on behalf of a proposed class of investors under
federal and various state laws who traded FX Instruments through FX
dealers or brokers not alleged to have manipulated Foreign Exchange
Rates. A different group of plaintiffs subsequently filed another
action based on the same theories and asserted substantively
similar claims. These two actions have been consolidated and a
consolidated complaint was filed in June 2017. Defendants
(including Barclays) will move to dismiss the action.
Canadian FX Action
Civil
actions similar to the Consolidated FX Action have been filed in
Canadian courts on behalf of proposed classes of plaintiffs
containing similar factual allegations of manipulation of Foreign
Exchange rates and of damages resulting from such manipulation, in
violation of Canadian law. The parties have reached a settlement in
principle for $14.8m which has been preliminary approved by the
Court. Payment of $14.8m was made in July 2017.
Claimed Amounts/Financial Impact
Aside
from the settlements discussed above, the financial impact of the
actions described on the Group or what effect that they might have
upon the Group’s operating results, cash flows or financial
position in any particular period is currently
uncertain.
Civil actions in respect of ISDAFIX
In
2014, a number of ISDAFIX related civil actions were filed in the
SDNY on behalf of proposed class of plaintiffs, alleging that
Barclays Bank PLC, a number of other banks and one broker violated
the Antitrust Act and several state laws by engaging in a
conspiracy to manipulate the USD ISDAFIX. In 2016, Barclays Bank
PLC and BCI entered into a settlement agreement with plaintiffs to
resolve the consolidated action and paid $30m, fully resolving all
ISDAFIX-related claims that were or could have been brought by the
class. The court has preliminarily approved the settlement, which
remains subject to final approval and to the right of class members
to opt-out of the settlement and to seek to file their own
claims.
Claimed Amounts/Financial Impact
The
principal financial impact of the actions described on the Group is
reflected in the settlement described above.
Metals investigations
Barclays
Bank PLC has been providing information to the DOJ, the CFTC and
other authorities in connection with investigations into metals and
metals-based financial instruments.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect that
they might have upon the Group’s operating results, cash
flows or financial position in any particular period.
Civil actions in respect of the gold and silver fix
Various
civil actions have been filed against Barclays Bank PLC and others
alleging manipulation of the prices of gold and
silver.
Background Information
A
number of civil complaints, each on behalf of a proposed class of
plaintiffs, have been consolidated and transferred to the SDNY. The
complaints allege that Barclays Bank PLC and other members of The
London Gold Market Fixing Ltd. manipulated the prices of gold and
gold derivative contracts in violation of the CEA, the Antitrust
Act, and state antitrust and consumer protection laws.
Civil
actions have been filed in Canadian courts against Barclays PLC,
Barclays Bank PLC, Barclays Capital Canada Inc., BCI and Barclays
Capital PLC on behalf of proposed classes of plaintiffs containing
similar factual allegations of the manipulation of the prices of
gold in violation of Canadian law.
In the
US, a proposed class of plaintiffs has filed an amended complaint
in an existing class action relating to silver, adding several
non-silver fixing banks, including Barclays Bank PLC, BCI and
Barclays Capital Services Ltd. alleging manipulation of the price
of silver in violation of CEA and the antitrust
laws.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect that
they might have upon the Group’s operating results, cash
flows or financial position in any particular period.
US residential and commercial mortgage-related activity and
litigation
There
have been various investigations and civil litigation relating to
secondary market trading of US residential mortgage-backed
securities (RMBS) and US commercial mortgage-backed securities
(CMBS).
Background Information
The
Group’s activities within the US residential mortgage sector
during the period from 2005 through 2008 included:
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●
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sponsoring
and underwriting of approximately $39bn of private-label
securitisations;
|
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●
|
economic
underwriting exposure of approximately $34bn for other
private-label securitisations;
|
|
●
|
sales
of approximately $0.2bn of loans to government sponsored
enterprises (GSEs);
|
|
●
|
sales
of approximately $3bn of loans to others; and
|
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●
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sales
of approximately $19.4bn of loans (net of approximately $500m of
loans sold during this period and subsequently repurchased) that
were originated and sold to third parties by mortgage originator
affiliates of an entity that the Group acquired in 2007 (Acquired
Subsidiary).
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DOJ Civil Action
In
December 2016, the DOJ filed a civil complaint against Barclays
Bank PLC, Barclays PLC, BCI., Barclays Group US Inc., Barclays US
LLC, BCP LLC, Securitized Asset Backed Receivables LLC and Sutton
Funding LLC, as well as two former employees, in the US District
Court in the Eastern District of New York (EDNY) containing a
number of allegations, including mail and wire fraud, relating to
mortgage-backed securities sold between 2005 and 2007. The DOJ
complaint seeks, amongst other relief, unspecified monetary
penalties. Barclays is defending the complaint and has filed a
motion to dismiss.
RMBS Repurchase Requests
The
Group was the sole provider of various loan-level representations
and warranties (R&Ws) with respect to:
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●
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approximately
$5bn of Group sponsored securitisations;
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|
●
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approximately
$0.2bn of sales of loans to GSEs; and
|
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approximately
$3bn of loans sold to others.
|
In
addition, the Acquired Subsidiary provided R&Ws on all of the
$19.4bn of loans it sold to third parties.
R&Ws
on the remaining Group sponsored securitisations were primarily
provided by third-party originators directly to the securitisation
trusts with a Group subsidiary, such as the depositor for the
securitisation, providing more limited R&Ws. There are no
stated expiration provisions applicable to most R&Ws made by
the Group, the Acquired Subsidiary or these third
parties.
Under
certain circumstances, the Group and/or the Acquired Subsidiary may
be required to repurchase the related loans or make other payments
related to such loans if the R&Ws are breached.
The
unresolved repurchase requests received on or before 30 June 2017
associated with all R&Ws made by the Group or the Acquired
Subsidiary on loans sold to GSEs and others and private-label
activities had an original unpaid principal balance of
approximately $2.1bn at the time of such sale.
The
unresolved repurchase requests discussed above relate to civil
actions that have been commenced by the trustees for certain RMBS
securitisations in which the trustees allege that the Group and/or
the Acquired Subsidiary must repurchase loans that violated the
operative R&Ws. Such trustees and other parties making
repurchase requests have also alleged that the operative R&Ws
may have been violated with respect to a greater (but unspecified)
amount of loans than the amount of loans previously stated in
specific repurchase requests made by such trustees. Cumulative
realised losses reported at 30 June 2017 on loans covered by
R&Ws made by the Group or the Acquired Subsidiary are
approximately $1.3bn. This litigation is ongoing.
In
addition, the Acquired Subsidiary is subject to a more advanced
civil action seeking, among other things, indemnification for
losses allegedly suffered by a loan purchaser as a result of
alleged breaches of R&Ws provided by the Acquired Subsidiary in
connection with loan sales to the purchaser during the period 1997
to 2007. This litigation is ongoing.
RMBS Securities Claims
As a
result of some of the RMBS activities described above, the Group
has been party to a number of lawsuits filed by purchasers of RMBS
sponsored and/or underwritten by the Group between 2005 and 2008.
As a general matter, these lawsuits alleged, among other things,
that the RMBS offering materials allegedly relied on by such
purchasers contained materially false and misleading statements
and/or omissions and generally demanded rescission and recovery of
the consideration paid for the RMBS and recovery of monetary losses
arising out of their ownership. The Group has resolved the majority
of these claims, and only one action currently remains
pending.
Approximately
$0.1bn of the original face amount of RMBS related to the remaining
pending action was outstanding as at 30 June 2017. There were
virtually no cumulative realised losses reported on these RMBS as
at 30 June 2017. The Group does not expect that, if it were to lose
the remaining pending action, any such loss to be
material.
Secondary Trading Investigation
The
Group has received requests for information and subpoenas from the
SEC, the US Attorney’s Office for the District of Connecticut
and the Special Inspector General for the US Troubled Asset Relief
Program related to trading practices in the secondary market for
both RMBS and CMBS. A settlement was announced in May 2017 pursuant
to which BCI agreed to resolve this matter for $16.56m, consisting
of $15.56m in disgorgement (to be repaid directly to customers) and
$1m in a civil penalty (paid to the SEC).
Claimed Amounts/Financial Impact
Save
for the May 2017 settlement, it is not currently practicable to
provide an estimate of the financial impact of the actions
described on the Group or what effect that they might have upon the
Group’s operating results, cash flows or financial position
in any particular period. The cost of resolving these actions could
individually or in aggregate prove to be substantial.
Alternative trading systems and high-frequency trading
The
SEC, the New York State Attorney General (NYAG) and regulators in
certain other jurisdictions have been investigating a range of
issues associated with alternative trading systems (ATSs),
including dark pools, and the activities of high-frequency
traders.
Background Information
In
2014, the NYAG filed a complaint (NYAG Complaint) against Barclays
PLC and BCI in the Supreme Court of the State of New York alleging,
amongst other things, that Barclays PLC and BCI engaged in fraud
and deceptive practices in connection with LX, the Group’s
SEC-registered ATS. In February 2016, Barclays reached separate
settlement agreements with the SEC and the NYAG to resolve those
agencies’ claims against Barclays PLC and BCI relating to the
operation of LX and paid $35m to each.
Barclays
PLC and BCI have been named in a purported class action by an
institutional financial services firm under California law based on
allegations similar to those in the NYAG Complaint. In October
2016, the federal court in California granted the motion of
Barclays PLC and BCI to dismiss the entire complaint and plaintiffs
have appealed the court’s decision.
Following
the filing of the NYAG Complaint, Barclays PLC and BCI were also
named in a putative shareholder securities class action along with
certain of its former CEOs, and its current and a former CFO, as
well as an employee (Shareholder Class Action). The plaintiffs
claim that holders of Barclays American Depository Receipts (ADRs)
suffered damages when the ADRs declined in value as a result of the
allegations in the NYAG Complaint. A motion to dismiss the
complaint filed by the defendants (including Barclays PLC and BCI),
was granted in part and denied in part by the court. In February
2016, the court certified the action as a class action which
Barclays is appealing.
Claimed Amounts/Financial Impact
The
class actions seek unspecified monetary damages and injunctive
relief. It is not currently practicable to provide an estimate of
the financial impact of the actions described on the Group or what
effect they might have upon the Group’s operating results,
cash flows or financial position in any particular
period.
FERC and other civil actions
The US
Federal Energy Regulatory Commission (FERC) has filed a civil
action against Barclays Bank PLC and certain of its former traders
in connection with allegations that Barclays Bank PLC manipulated
the electricity markets in the Western US.
Background Information
In
2012, FERC issued an Order to Show Cause and Notice of Proposed
Penalties (Order and Notice) against Barclays Bank PLC and four of
its former traders asserting that Barclays Bank PLC and its former
traders violated FERC’s Anti-Manipulation Rule by
manipulating the electricity markets in and around California from
2006 to 2008, and proposed civil penalties and profit disgorgement
to be paid by Barclays Bank PLC.
In
2013, FERC filed a civil action against Barclays Bank PLC and its
former traders in the US District Court in California seeking to
collect a $435m civil penalty and disgorgement of $34.9m of
profits, plus interest. In 2015, the US District Court in
California ordered that it would bifurcate its assessment of
liabilities and penalties from its assessment of disgorgement. In
March 2017, the court denied FERC’s motion for summary
affirmance of the penalty assessment and ordered
discovery.
In
2015, a civil class action complaint seeking damages of $139.3m was
filed in the US District Court for the SDNY against Barclays Bank
PLC by Merced Irrigation District, a California utility company,
asserting antitrust allegations in connection with Barclays Bank
PLC’s purported manipulation of the electricity markets in
and around California. The factual allegations mirror those raised
in the civil action filed by FERC. In 2016, Barclays Bank PLC
motion to dismiss the civil class action for failure to state a
claim was granted in part and denied in part by the SDNY. The
matter is in discovery.
Claimed Amounts/Financial Impact
FERC
has made claims against Barclays Bank PLC totalling $469.9m, plus
interest, for civil penalties and profit disgorgement. The civil
class action complaint refers to damages of $139.3m. These amounts
do not necessarily reflect Barclays Bank PLC’s potential
financial exposure if a ruling were to be made against it in either
action.
Treasury auction securities civil actions and related
matters
Numerous
putative class action complaints have been filed in US Federal
Courts against BCI and other financial institutions that have
served as primary dealers in US Treasury securities. The complaints
have been consolidated in the US Federal Court in New York. The
complaints generally allege that defendants conspired to manipulate
the US Treasury securities market in violation of US federal
antitrust laws, the CEA and state common law. Some complaints also
allege that defendants engaged in illegal “spoofing” of
the US Treasury market.
Certain
governmental authorities are conducting investigations into
activities relating to the trading of certain government securities
in various markets and Barclays has been providing information to
various authorities on an ongoing basis.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect that
they might have upon the Group’s operating results, cash
flows or financial position in any particular period.
American Depositary Shares
Barclays
PLC, Barclays Bank PLC and various former members of Barclays Bank
PLC's Board of Directors have been named as defendants in a
securities class action consolidated in the SDNY.
Background Information
The
securities class action against Barclays PLC, Barclays Bank PLC and
various former members of Barclays Bank PLC's Board of Directors
alleges misstatements and omissions in offering documents for
certain American Depositary Shares issued by Barclays Bank PLC in
April 2008 with an original face amount of approximately $2.5
billion (the April 2008 Offering). The plaintiffs assert claims
under the Securities Act of 1933, alleging misstatements and
omissions concerning (amongst other things) Barclays Bank
PLC’s portfolio of mortgage-related (including US
subprime-related) securities, Barclays Bank PLC’s exposure to
mortgage and credit market risk, and Barclays Bank PLC’s
financial condition. The plaintiffs have not specifically alleged
the amount of their damages. In June 2016, the SDNY certified the
action as a class action. Barclays has moved for summary
judgement.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the action described on the Group or what effect that it
might have upon the Group’s operating results, cash flows or
financial position in any particular period.
BDC Finance L.L.C.
BDC
Finance L.L.C. (BDC) has filed a complaint against Barclays Bank
PLC alleging breach of contract in connection with a portfolio of
total return swaps governed by an ISDA Master Agreement
(collectively, the Agreement).
Background Information
In
2008, BDC filed a complaint in the NY Supreme Court alleging that
Barclays Bank PLC breached the Agreement when it failed to transfer
approximately $40m of alleged excess collateral in response to
BDC’s 2008 demand (Demand).
BDC
asserts that under the Agreement Barclays Bank PLC was not entitled
to dispute the Demand before transferring the alleged excess
collateral and that even if the Agreement entitled Barclays Bank
PLC to dispute the Demand before making the transfer, Barclays Bank
PLC failed to dispute the Demand. BDC demands damages totalling
$298m plus attorneys’ fees, expenses, and pre-judgement
interest. A trial on liability issues concluded in April 2017 and
the court’s decision is pending.
In
2011, BDC’s investment advisor, BDCM Fund Adviser, L.L.C. and
its parent company, Black Diamond Capital Holdings, L.L.C. also
sued Barclays Bank PLC and BCI in Connecticut State Court for
unspecified damages allegedly resulting from Barclays Bank
PLC’s conduct relating to the Agreement, asserting claims for
violation of the Connecticut Unfair Trade Practices Act and
tortious interference with business and prospective business
relations. The parties agreed to stay this case.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect that
they might have upon the Group’s operating results, cash
flows or financial position in any particular period. BDC has made
claims against the Group totalling $298m plus attorneys’
fees, expenses, and pre-judgement interest. This amount does not
necessarily reflect the Group’s potential financial exposure
if a ruling were to be made against it.
Civil actions in respect of the US Anti-Terrorism Act
Civil
complaints against Barclays Bank PLC and other banks allege
engagement in a conspiracy and violation of the US Anti-Terrorism
Act (ATA).
Background Information
In
2015, an amended civil complaint was filed in the US Federal Court
in the EDNY by a group of approximately 250 plaintiffs, alleging
that Barclays Bank PLC and a number of other banks engaged in a
conspiracy and violated the ATA by facilitating US dollar
denominated transactions for the Government of Iran and various
Iranian banks, which in turn funded Hezbollah and other attacks
that injured or killed the plaintiffs’ family members.
Plaintiffs seek to recover for pain, suffering and mental anguish
pursuant to the provisions of the ATA, which allows for the
tripling of any proven damages and attorneys' fees. Plaintiffs
filed a second amended complaint in July 2016, which, among other
things, added various plaintiffs, bringing the total number of
plaintiffs to approximately 350. In November 2016, defendants filed
a motion to dismiss.
In
November 2016, a separate civil complaint was filed in the US
Federal Court in the Southern District of Illinois by a group of
approximately 90 plaintiffs, alleging claims under the ATA against
Barclays Bank PLC and a number of other banks. The allegations
against Barclays Bank PLC are substantially similar to those in the
second amended complaint filed in the US Federal Court in the EDNY
action in July 2016. Plaintiffs filed an amended complaint in
January 2017, which, among other things, added various plaintiffs,
bringing the total number of plaintiffs to approximately 200. In
April 2017, this action was transferred to the US Federal Court in
the EDNY, where it is now pending.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect that
they might have upon the Group’s operating results, cash
flows or financial position in any particular period.
Interest rate swap and credit default swap US civil
actions
Barclays
PLC, Barclays Bank PLC, and BCI, together with other financial
institutions are defendants in interest rate swap and credit
default swap antitrust civil actions in the SDNY.
Background Information
Barclays
PLC, Barclays Bank PLC, and BCI, together with other financial
institutions that act as market makers for interest rate swaps
(IRS), Trade Web, and ICAP, are named as defendants in several
antitrust class actions which were consolidated in the SDNY in
2016. The complaints allege defendants conspired to prevent the
development of exchanges for IRS and demand unspecified money
damages, treble damages and legal fees. Plaintiffs include certain
swap execution facilities, as well as buy-side investors. The
buy-side investors claim to represent a class that transacted in
fixed-for-floating IRS with defendants in the US from 2008 to the
present, including, for example, US retirement and pension funds,
municipalities, university endowments, corporations, insurance
companies and investment funds. Defendants have filed motions to
dismiss. In June 2017, a separate suit was filed in the US District
Court in the SDNY against the same financial institution defendants
in the IRS cases, including Barclays PLC, Barclays Bank PLC, and
BCI, claiming that certain conduct alleged in the IRS cases also
caused plaintiff to suffer harm with respect to the Credit Default
Swaps market. Defendants will also move to dismiss this
action.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the actions described on the Group or what effect it have
upon the Group’s operating results, cash flows or financial
position in any particular period.
CCUK Finance Limited and CIAC Corporation
In May
2017, Barclays Bank PLC was served with a civil claim by CCUK
Finance Limited and CIAC Corporation issued in the English High
Court alleging breach of a contractual indemnity, fraudulent
misrepresentation and breach of warranty arising out of the sale of
a portfolio of credit cards in 2007. Barclays Bank PLC has
filed a defence and counterclaim.
Claimed Amounts/Financial Impact
The
claim seeks damages of not less than £1bn plus interest and
costs. The damages claimed does not necessarily reflect Barclays
Bank PLC’s potential financial exposure if a ruling were to
be made against it. It is not currently practicable to provide an
estimate of the financial impact of the action described or what
effect it might have upon operating results, cash flows or the
Group’s financial position in any particular
period.
Portuguese Competition Authority investigation
The
Portuguese Competition Authority is investigating whether
competition law was infringed by the exchange of information about
retail credit products amongst 15 banks in Portugal, including the
Group, over a period of 11 years with particular reference to
mortgages, consumer lending and lending to small and medium
enterprises. The Group is cooperating with the
investigation.
Claimed Amounts/Financial Impact
It is
not currently practicable to provide an estimate of the financial
impact of the action described or what effect it might have upon
operating results, cash flows or the Group’s financial
position in any particular period.
General
The
Group is engaged in various other legal, competition and regulatory
matters in the UK and US and a number of other overseas
jurisdictions. It is subject to legal proceedings 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 protection, 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 co-operating 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, the Group does not expect the ultimate resolution of
any of these other matters to have a material adverse effect on its
financial position. However, in light of the uncertainties involved
in such matters and the matters specifically described in this
note, there can be no assurance that the outcome of a
particular matter or matters will not be material to the
Group’s results of operations or cash flow for a particular
period, depending on, amongst other things, the amount of the loss
resulting from the matter(s) and the amount of income otherwise
reported for the reporting period.
20.
Related party transactions
No
related party transactions that have taken place in the half year
ended 30 June 2017 have materially affected the financial position
or the performance of the Group during this period.
Barclays Africa Group Limited
On 1
June 2017, Barclays reduced its holding in BAGL to 16.4% of
BAGL’s issued share capital with an obligation to contribute
to a BEE scheme leaving a residual holding of 14.9%. This resulted
in accounting deconsolidation of BAGL from the Group, with the
holding recognised as an available for sale investment. For further
detail, see Note 4.
As a
consequence of the Group no longer being considered to have a
significant influence over BAGL, it ceased to be a related party of
the Group on 1 June 2017.
Other related party transactions
Other
related party transactions in the half year ended 30 June 2017 were
similar in nature to those disclosed in the 2016 Annual
Report.
21.
Segmental reporting
Analysis of results by business
|
Barclays
UK
|
Barclays
International
|
Head
Office
|
Barclays
Core
1
|
Barclays
Non-Core
2
|
Barclays
Group
|
Half year ended 30.06.17
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Total income net of insurance claims
|
3,661
|
7,748
|
2
|
11,411
|
(530)
|
10,881
|
Credit impairment charges and other provisions
|
(398)
|
(625)
|
(1)
|
(1,024)
|
(30)
|
(1,054)
|
Net operating income
|
3,263
|
7,123
|
1
|
10,387
|
(560)
|
9,827
|
Operating expenses
|
(2,628)
|
(4,720)
|
(100)
|
(7,448)
|
(284)
|
(7,732)
|
Other net (expenses)/income
3
|
(1)
|
214
|
(164)
|
49
|
197
|
246
|
Profit before tax
|
634
|
2,617
|
(263)
|
2,988
|
(647)
|
2,341
|
|
|
|
|
|
|
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Total assets
|
203.4
|
681.6
|
17.3
|
902.3
|
233.0
|
1,135.3
|
|
|
|
|
|
|
|
Analysis of results by business
|
Barclays
UK
|
Barclays
International
|
Head
Office
|
Barclays
Core
|
Barclays
Non-Core
|
Barclays
Group
|
Half year ended 30.06.16
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Total income net of insurance claims
|
3,746
|
7,552
|
301
|
11,599
|
(586)
|
11,013
|
Credit impairment charges and other provisions
|
(366)
|
(509)
|
(1)
|
(876)
|
(55)
|
(931)
|
Net operating income
|
3,380
|
7,043
|
300
|
10,723
|
(641)
|
10,082
|
Operating expenses
|
(2,299)
|
(4,309)
|
(139)
|
(6,747)
|
(950)
|
(7,697)
|
Other net (expenses)/income
2
|
(1)
|
19
|
(27)
|
(9)
|
(313)
|
(322)
|
Profit before tax
|
1,080
|
2,753
|
134
|
3,967
|
(1,904)
|
2,063
|
|
|
|
|
|
|
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Total assets
|
204.6
|
679.9
|
87.7
|
972.2
|
379.1
|
1,351.3
|
1
|
Barclays Core consists of Barclays UK, Barclays International and
Head Office.
|
2
|
Barclays Non-Core segment was closed on 1 July 2017, with
prospective financial performance being reintegrated into Barclays
UK, Barclays International and Head Office.
|
3
|
Other net (expenses)/income represents: profit or (loss) on
disposal of undertakings, share of results of associates and joint
ventures, and impairment on assets held for sale.
|
|
Half year ended
|
Half year ended
|
Split of income by geographic region
1
|
30.06.17
|
30.06.16
|
|
£m
|
£m
|
UK
|
5,649
|
5,915
|
Europe
|
731
|
1,159
|
Americas
|
4,093
|
3,417
|
Africa and Middle East
|
139
|
191
|
Asia
|
269
|
331
|
Total
|
10,881
|
11,013
|
1
|
The geographic region is based on counterparty
location.
|
22.
Barclays PLC parent balance
sheet
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
Assets
|
£m
|
£m
|
Investment in subsidiaries
|
37,803
|
36,553
|
Loans and advances to subsidiaries
|
25,200
|
19,421
|
Financial investments
|
1,286
|
1,218
|
Derivative financial instruments
|
148
|
268
|
Other assets
|
106
|
105
|
Total assets
|
64,543
|
57,565
|
|
|
|
Liabilities
|
|
|
Deposits from banks
|
515
|
547
|
Subordinated liabilities
|
5,236
|
3,789
|
Debt securities in issue
|
21,225
|
16,893
|
Other liabilities
|
68
|
14
|
Total liabilities
|
27,044
|
21,243
|
|
|
|
Equity
|
|
|
Called up share capital
|
4,258
|
4,241
|
Share premium account
|
17,740
|
17,601
|
Other equity instruments
|
7,697
|
6,453
|
Other reserves
|
473
|
420
|
Retained earnings
|
7,331
|
7,607
|
Total equity
|
37,499
|
36,322
|
Total liabilities and equity
|
64,543
|
57,565
|
Investment in subsidiary
The
investment in subsidiary of £37,803m (December 2016:
£36,553m) represents investments made into Barclays Bank PLC,
including £7,736m (December 2016: £6,486m) of Additional
Tier 1 (AT1) securities. The increase of £1,250m during the
period was driven by a £1,250m AT1 issuance by Barclays PLC
during the first quarter.
Loans and advances to subsidiary, subordinated liabilities and debt
securities in issue
During
H117, Barclays PLC issued $2.0bn of Fixed Rate Subordinated Notes
included within the subordinated liabilities balance of
£5,236m (December 2016: £3,789m), and $5.0bn of Fixed and
Floating Rate Senior Notes and £0.95bn of Fixed Rate Senior
Notes included within the debt securities in issue balance of
£21,225m (December 2016: £16,893m). The proceeds raised
through these transactions were used to invest in Barclays Bank PLC
Notes in each case with a ranking corresponding to the notes issued
by Barclays PLC and included within the loans and advances to
subsidiary balance of £25,200m (December 2016: £19,421m)
and financial investments balance of £1,286m (December 2016
£1,218m).
Management of internal investments, loans and advances
Barclays
PLC retains the discretion to manage the nature of its internal
investments in the subsidiaries according to their regulatory and
business needs. As we implement our structural reform programme,
Barclays PLC will invest capital and funding to Barclays Bank PLC
and other Group subsidiaries such as the Group service company, the
US IHC and the UK ring-fenced bank.
Appendix: Non-IFRS Performance Measures
The
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 business’
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 Barclays PLC and its subsidiaries (the Group).
They also reflect an important aspect of the way in which operating
targets are defined and performance is monitored by Barclays’
management.
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
|
Barclays
Core
|
Barclays Core
includes Barclays UK, Barclays International and Head Office. A
reconciliation of Core statutory results is included on page
111.
|
Return
on average tangible shareholders’ equity
|
Statutory profit
after tax attributable to ordinary shareholders, including an
adjustment for the tax credit in reserves in respect of other
equity instruments, 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
pages 112-113.
|
Return
on average allocated tangible shareholders’
equity
|
Statutory profit
after tax attributable to ordinary shareholders, including an
adjustment for the tax credit in reserves in respect of other
equity instruments, as a proportion of average allocated tangible
shareholders’ equity. The components of the calculation have
been included on pages 112-113.
|
Period
end allocated tangible equity
|
Allocated tangible
equity is calculated as 12.0% (2016: 11.5%) of CRD IV fully loaded
risk weighted assets for each business, adjusted for CRD IV fully
loaded capital deductions, excluding goodwill and intangible
assets, reflecting the assumptions the Group uses for capital
planning purposes. Head Office tangible equity represents the
difference between the Group's tangible 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 shareholders’ 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 shareholders’ equity
for the period is the average of the monthly averages within that
period.
|
Cost:
income ratio
|
Total
operating expenses divided by total income.
|
Basic
earnings/(loss) per share contribution (Barclays Core and
Non-Core)
|
The
calculation is consistent with the IFRS measure and applied to the
Barclays Core and Non-Core: statutory profit after tax attributable
to ordinary shareholders, including an adjustment for the tax
credit in reserves in respect of other equity instruments, divided
by the Group basic weighted average number of shares. The
components of the calculation have been included on page
114.
|
Loan
loss rate
|
Is
quoted in basis points and represents total annualised loan
impairment divided by gross loans and advances to customers and
banks held at amortised cost at the balance sheet
date.
|
Loan:
deposit ratio
|
Loans
and advances divided by customer accounts calculated for Barclays
UK, Barclays International and Non-Core, excluding investment
banking businesses. This excludes particular liabilities issued by
the retail businesses that have characteristics comparable to
retail deposits (for example structured Certificates of Deposit and
retail bonds), which are included within debt securities in
issue.
|
Net
interest margin
|
Annualised net
interest income divided by the sum of average customer assets. The
components of the calculation have been included on page
46.
|
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 114.
|
Barclays Core Reconciliation
|
Half year ended 30.06.17
|
|
Half year ended 30.06.16
|
|
Barclays UK
|
Barclays International
|
Head Office
|
Barclays Core
|
|
Barclays UK
|
Barclays International
|
Head Office
|
Barclays Core
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
Total income
|
3,661
|
7,748
|
2
|
11,411
|
|
3,746
|
7,552
|
301
|
11,599
|
Credit impairment charges and other provisions
|
(398)
|
(625)
|
(1)
|
(1,024)
|
|
(366)
|
(509)
|
(1)
|
(876)
|
Net operating income
|
3,263
|
7,123
|
1
|
10,387
|
|
3,380
|
7,043
|
300
|
10,723
|
Operating expenses excluding litigation and conduct
|
(1,933)
|
(4,711)
|
(89)
|
(6,733)
|
|
(1,899)
|
(4,295)
|
(121)
|
(6,315)
|
Litigation and conduct
|
(695)
|
(9)
|
(11)
|
(715)
|
|
(400)
|
(14)
|
(18)
|
(432)
|
Operating expenses
|
(2,628)
|
(4,720)
|
(100)
|
(7,448)
|
|
(2,299)
|
(4,309)
|
(139)
|
(6,747)
|
Other net (expenses)/income
|
(1)
|
214
|
(164)
|
49
|
|
(1)
|
19
|
(27)
|
(9)
|
Profit/(loss) before tax
|
634
|
2,617
|
(263)
|
2,988
|
|
1,080
|
2,753
|
134
|
3,967
|
Attributable profit/(loss)
|
185
|
1,656
|
(298)
|
1,543
|
|
608
|
1,746
|
90
|
2,444
|
|
|
|
|
|
|
|
|
|
|
Average allocated tangible equity (£bn)
|
8.8
|
27.5
|
8.2
|
44.5
|
|
9.1
|
25.0
|
5.8
|
39.9
|
Risk weighted assets (£bn)
|
66.1
|
212.2
|
26.2
|
304.6
|
|
67.1
|
209.3
|
43.2
|
319.6
|
Returns
Return
on average allocated tangible equity is calculated as profit for
the period attributable to ordinary equity holders of the parent
(adjusted for the tax credit recorded in reserves in respect of
interest payments on other equity instruments) divided by average
allocated tangible equity for the period as appropriate, excluding
non-controlling and other equity interests for businesses.
Allocated tangible equity has been calculated as 12.0% (2016:
11.5%) of CRD IV fully loaded risk weighted assets for each
business, adjusted for CRD IV fully loaded capital deductions,
excluding goodwill and intangible assets, reflecting the
assumptions the Group uses for capital planning purposes. Head
Office average tangible equity represents the difference between
the Group's average tangible equity and the amounts allocated to
businesses.
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
Attributable profit
|
£m
|
£m
|
Barclays UK
|
185
|
608
|
Corporate
and Investment Bank
|
1,083
|
868
|
Consumer,
Cards and Payments
|
573
|
878
|
Barclays International
|
1,656
|
1,746
|
Head Office
|
(298)
|
90
|
Barclays Core
|
1,543
|
2,444
|
Barclays Non-Core
|
(419)
|
(1,490)
|
Africa Banking discontinued operation
|
(2,335)
|
156
|
Barclays Group
|
(1,211)
|
1,110
|
|
|
|
Tax credit in respect of interest payments on other equity
instruments
|
|
|
Barclays UK
|
18
|
14
|
Corporate
and Investment Bank
|
45
|
35
|
Consumer,
Cards and Payments
|
9
|
5
|
Barclays International
|
54
|
40
|
Head Office
|
-
|
(4)
|
Barclays Core
|
72
|
50
|
Barclays Non-Core
|
10
|
8
|
Africa Banking discontinued operation
|
-
|
-
|
Barclays Group
|
82
|
58
|
|
|
|
Profit/(loss) attributable to ordinary equity holders of the
parent
|
|
|
Barclays UK
|
203
|
622
|
Corporate
and Investment Bank
|
1,128
|
903
|
Consumer,
Cards and Payments
|
582
|
883
|
Barclays International
|
1,710
|
1,786
|
Head Office
|
(298)
|
86
|
Barclays Core
|
1,615
|
2,494
|
Barclays Non-Core
|
(409)
|
(1,482)
|
Africa Banking discontinued operation
|
(2,335)
|
156
|
Barclays Group
|
(1,129)
|
1,168
|
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
Average allocated tangible equity
|
£bn
|
£bn
|
Barclays UK
|
8.8
|
9.1
|
Corporate
and Investment Bank
|
23.3
|
21.5
|
Consumer,
Cards and Payments
|
4.2
|
3.5
|
Barclays International
|
27.5
|
25.0
|
Head Office
1
|
8.2
|
5.8
|
Barclays Core
|
44.5
|
39.9
|
Barclays Non-Core
|
4.9
|
8.5
|
Barclays Group
|
49.4
|
48.3
|
|
|
|
Return on average allocated tangible equity
|
%
|
%
|
Barclays UK
|
4.6%
|
13.6%
|
Corporate
and Investment Bank
|
9.7%
|
8.4%
|
Consumer,
Cards and Payments
|
28.0%
|
50.9%
|
Barclays International
|
12.4%
|
14.3%
|
|
|
|
Barclays Core
2
|
7.3%
|
12.5%
|
|
|
|
Barclays Group
|
(4.6%)
|
4.8%
|
|
|
|
|
Returns excluding charges for PPI, impairment of Barclays' holding
in BAGL and loss on the sale of BAGL
|
|
|
|
Half year ended
|
|
|
30.06.17
|
|
|
£m
|
|
Barclays Core profit attributable to ordinary equity
holders
|
1,615
|
|
Impact of charges for PPI
|
(692)
|
|
Barclays Core profit attributable to
ordinary equity holders of the parent excluding charges for
PPI
|
2,307
|
|
|
Average allocated tangible equity
|
£bn
|
Barclays Core
|
44.5
|
|
|
|
Return on average allocated tangible equity excluding charges for
PPI
|
%
|
|
Barclays Core
2
|
10.4%
|
|
|
|
|
|
£m
|
|
Barclays Group profit attributable to ordinary equity
holders
|
(1,129)
|
|
Impact of charges for PPI
|
(692)
|
|
Impact of impairment of Barclays’ holding in
BAGL
|
(1,008)
|
|
Impact of loss on the sale of BAGL
|
(1,435)
|
|
Barclays Group profit attributable to ordinary equity holders of
the parent excluding charges for PPI, impairment of Barclays'
holding in BAGL and loss on the sale of BAGL
|
2,006
|
|
|
Average allocated tangible equity
|
£bn
|
Barclays Group
|
49.4
|
|
|
Return on average allocated tangible equity excluding charges for
PPI, impairment of Barclays' holding in BAGL and loss on the sale
of BAGL
|
|
|
|
|
%
|
|
Barclays Group
|
8.1%
|
1
|
Includes the Africa Banking discontinued operation.
|
2
|
Includes Head Office.
|
Earnings per share
|
|
|
|
Half year ended
|
Half year ended
|
|
30.06.17
|
30.06.16
|
Profit/(loss) attributable to ordinary
equity holders of the parent
1
|
£m
|
£m
|
Barclays Core
|
1,615
|
2,494
|
Barclays Non-Core
|
(409)
|
(1,482)
|
Africa Banking discontinued operation
|
(2,335)
|
156
|
Barclays Group
|
(1,129)
|
1,168
|
|
|
|
|
m
|
m
|
Basic weighted average number of shares
|
16,989
|
16,859
|
|
|
|
Basic earnings per ordinary share
|
p
|
p
|
Barclays Core contribution
|
9.5
|
14.8
|
Barclays Non-Core contribution
|
(2.4)
|
(8.8)
|
|
|
|
Barclays Group
|
(6.6)
|
6.9
|
|
|
|
Earnings per share excluding charges for PPI, impairment of
Barclays' holding in BAGL and loss on the sale of BAGL
|
|
Half year ended
|
|
30.06.17
|
Profit attributable to ordinary equity holders of the parent
excluding charges for PPI, impairment of Barclays' holding in BAGL
and loss on the sale of BAGL
|
£m
|
Barclays Group profit attributable to ordinary equity
holders
|
(1,129)
|
Impact of charges for PPI
|
(692)
|
Impact of impairment of Barclays’ holding in
BAGL
|
(1,008)
|
Impact of loss on the sale of BAGL
|
(1,435)
|
Barclays Group profit attributable to ordinary equity holders of
the parent excluding charges for PPI, impairment of Barclays'
holding in BAGL and loss on the sale of BAGL
|
2,006
|
|
|
|
m
|
Basic weighted average number of shares
|
16,989
|
|
|
Basic earnings per ordinary share excluding charges for PPI,
impairment of Barclays' holding in BAGL and loss on the sale of
BAGL
|
p
|
Barclays Group
|
11.8
|
1
|
The profit after tax attributable to other equity holders of
£301m (H116: £208m) is offset by a tax credit recorded in
reserves of 82m (H116: £58m). The net amount of
£219m (H116: £150m), along with non-controlling interests
(NCI) is deducted from profit after tax in order to calculate
earnings per share and return on average tangible
shareholders’ equity.
|
Tangible net asset value
|
|
|
|
As at
|
As at
|
|
30.06.17
|
31.12.16
|
|
£m
|
£m
|
Total equity excluding non-controlling interests
|
63,866
|
64,873
|
Other equity instruments
|
(7,694)
|
(6,449)
|
Goodwill and intangibles
1
|
(7,724)
|
(9,245)
|
Tangible shareholders' equity attributable to ordinary shareholders
of the parent
|
48,448
|
49,179
|
|
|
|
|
m
|
m
|
Shares in issue
|
17,034
|
16,963
|
|
|
|
|
p
|
p
|
Tangible net asset value per share
|
284
|
290
|
1
|
Comparative figures include goodwill and intangibles in relation to
Africa Banking.
|
Shareholder Information
|
|
|
|
|
|
Results timetable
1
|
Date
|
|
|
|
|
Ex-dividend date
|
10 August 2017
|
Dividend Record date
|
11 August 2017
|
Scrip reference share price set and made available to
shareholders
|
17 August 2017
|
Cut off time of 4.30 pm (London time) for the receipt of Mandate
Forms or Revocation Forms (as applicable)
|
25 August 2017
|
Dividend Payment date /first day of dealing in New
Shares
|
18 September 2017
|
Q3 2017 Results Announcement
|
31 October 2017
|
|
|
|
|
|
|
For qualifying US and Canadian resident ADR holders, the interim
dividend of 1.0p per ordinary share becomes 4.0p per ADS
(representing four shares). The ex-dividend, dividend record and
dividend payment dates for ADR holders are as shown
above.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% Change
3
|
Exchange rates
2
|
30.06.17
|
31.12.16
|
30.06.16
|
31.12.16
|
30.06.16
|
Period end - US$/£
|
1.30
|
1.23
|
1.34
|
6%
|
(3%)
|
6 month average - US$/£
|
1.26
|
1.28
|
1.43
|
(2%)
|
(12%)
|
3 month average - US$/£
|
1.28
|
1.24
|
1.43
|
3%
|
(10%)
|
Period end - €/£
|
1.14
|
1.17
|
1.21
|
(3%)
|
(6%)
|
6 month average - €/£
|
1.16
|
1.16
|
1.29
|
-
|
(10%)
|
3 month average - €/£
|
1.16
|
1.15
|
1.27
|
1%
|
(9%)
|
Period end - ZAR/£
|
16.98
|
16.78
|
19.63
|
1%
|
(13%)
|
6 month average - ZAR/£
|
16.61
|
17.90
|
22.17
|
(7%)
|
(25%)
|
3 month average - ZAR/£
|
16.85
|
17.29
|
21.51
|
(3%)
|
(22%)
|
|
|
|
|
|
|
Share price data
|
30.06.17
|
31.12.16
|
30.06.16
|
|
|
Barclays PLC (p)
|
202.75
|
223.45
|
138.60
|
|
|
Barclays PLC number of shares (m)
|
17,034
|
16,963
|
16,913
|
|
|
Barclays Africa Group Limited (formerly Absa Group Limited)
(ZAR)
|
143.75
|
168.69
|
144.08
|
|
|
Barclays Africa Group Limited (formerly Absa Group Limited) number
of shares (m)
|
848
|
848
|
848
|
|
|
|
|
|
|
|
|
For further information please contact
|
|
|
|
|
|
|
|
|
|
|
|
Investor relations
|
Media relations
|
Kathryn McLeland +44 (0) 20 7116 4943
|
Thomas Hoskin +44 (0) 20 7116 4755
|
|
|
|
|
|
|
More information on Barclays can be found on our website:
home.barclays
|
|
|
|
|
|
|
|
|
|
|
|
Registered office
|
|
|
|
|
|
1 Churchill Place, London, E14 5HP, United Kingdom. Tel: +44 (0) 20
7116 1000. Company number: 48839
|
|
|
|
|
|
|
|
Registrar
|
|
|
|
|
|
Equiniti, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA
United Kingdom.
|
|
|
|
|
Tel: 0371 384 2055
4
from the UK or +44 121 415 7004 from
overseas.
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Note that these announcement dates are provisional and subject to
change. Any changes to the Scrip Dividend Programme dates will be
made available at home.barclays/dividends.
|
2
|
The average rates shown above are derived from daily spot rates
during the year.
|
3
|
The change is the impact to GBP reported information.
|
4
|
Lines open 8.30am to 5.30pm UK time, Monday to Friday, excluding UK
public holidays in England and Wales.
|