Last checked at 26 Oct 2022 07:00
Barclays PLC
Q3 2022 Results Announcement
30 September 2022
Notes
The terms Barclays and Group refer to Barclays PLC together with its subsidiaries. Unless otherwise stated, the income statement analysis compares the nine months ended 30 September 2022 to the corresponding nine months of 2021 and the three months ended 30 September 2022 to the corresponding three months in 2021 and balance sheet analysis as at 30 September 2022 with comparatives relating to 31 December 2021 and 30 September 2021. The historical financial information used for the purposes of such analysis has been restated. Please refer to Supplementary Information contained herein for further information. The abbreviations '£m' and '£bn' represent millions and thousands of millions of Pounds Sterling respectively; the abbreviations '$m' and '$bn' represent millions and thousands of millions of US Dollars respectively; and the abbreviations '€m' and '€bn' represent millions and thousands of millions of Euros respectively.
There are a number of key judgement areas, for example impairment calculations, which are based on models and which are subject to ongoing adjustment and modifications. Reported numbers reflect best estimates and judgements at the given point in time.
Relevant terms that are used in this document but are not defined under applicable regulatory guidance or International Financial Reporting Standards (IFRS) are explained in the results glossary, which can be accessed at home.barclays/investor-relations.
The information in this announcement, which was approved by the Board of Directors on 25 October 2022, does not comprise statutory accounts within the meaning of Section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 December 2021, which contained an unmodified audit report under Section 495 of the Companies Act 2006 (which did not make any statements under Section 498 of the Companies Act 2006) have been delivered to the Registrar of Companies in accordance with Section 441 of the Companies Act 2006.
These results will be furnished on Form 6-K with the US Securities and Exchange Commission (SEC) as soon as practicable following their publication. Once furnished with the SEC, a copy of the Form 6-K will be available from the SEC's website at www.sec.gov.
Barclays is a frequent issuer in the debt capital markets and regularly meets with investors via formal road-shows and other ad hoc meetings. Consistent with its usual practice, Barclays expects that from time to time over the coming quarter it will meet with investors globally to discuss these results and other matters relating to the Group.
Non-IFRS performance measures
Barclays' management believes that the non-IFRS performance measures included in this document provide valuable information to the readers of the financial statements as they enable the reader to identify a more consistent basis for comparing the businesses' performance between financial periods and provide more detail concerning the elements of performance which the managers of these businesses are most directly able to influence or are relevant for an assessment of the Group. They also reflect an important aspect of the way in which operating targets are defined and performance is monitored by Barclays' management. However, any non-IFRS performance measures in this document are not a substitute for IFRS measures and readers should consider the IFRS measures as well. Refer to the appendix on pages 53 to 59 for further information and calculations of non-IFRS performance measures included throughout this document, and the most directly comparable IFRS measures.
Forward-looking statements
This document contains certain forward-looking statements within the meaning of Section 21E of the US Securities Exchange Act of 1934, as amended, and Section 27A of the US Securities Act of 1933, as amended, with respect to the Group. Barclays cautions readers that no forward-looking statement is a guarantee of future performance and that actual results or other financial condition or performance measures could differ materially from those contained in the forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements sometimes use words such as 'may', 'will', 'seek', 'continue', 'aim', 'anticipate', 'target', 'projected', 'expect', 'estimate', 'intend', 'plan', 'goal', 'believe', 'achieve' or other words of similar meaning. Forward-looking statements can be made in writing but also may be made verbally by members of the management of the Group (including, without limitation, during management presentations to financial analysts) in connection with this document. Examples of forward-looking statements include, among others, statements or guidance regarding or relating to the Group's future financial position, income levels, assets and liabilities, impairment charges, provisions, capital, leverage and other regulatory ratios, capital distributions (including dividend pay-out ratios and expected payment strategies), projected levels of growth in banking and financial markets, projected expenditures, costs or savings, any commitments and targets (including, without limitation, environmental, social and governance (ESG) commitments and targets), business strategy, plans and objectives for future operations, group structure, IFRS impacts and other statements that are not historical or current facts. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Forward-looking statements speak only as at the date on which they are made. Forward-looking statements may be affected by a number of factors, including, without limitation: changes in legislation, regulation and the interpretation thereof, the development of IFRS and other accounting standards, including evolving practices with regard to the interpretation and application of accounting standards, emerging and developing ESG reporting standards, the outcome of current and future legal proceedings and regulatory investigations and any related impact on provisions, the policies and actions of governmental and regulatory authorities, the Group's ability along with governments and other stakeholders to measure, manage and mitigate the impacts of climate change effectively, environmental, social and geopolitical risks and incidents or similar events beyond the Group's control, and the impact of competition. In addition, factors including (but not limited to) the following may have an effect: capital, leverage and other regulatory rules applicable to past, current and future periods; UK, US, Eurozone and global macroeconomic and business conditions, including inflation; volatility in credit and capital markets; market-related risks such as changes in interest rates and foreign exchange rates; changes in valuation of credit market exposures; changes in valuation of issued securities; changes in credit ratings of any entity within the Group or any securities issued by such entities; changes in counterparty risk; changes in consumer behaviour; the direct and indirect consequences of the Russia-Ukraine war on European and global macroeconomic conditions, political stability and financial markets; direct and indirect impacts of the coronavirus (COVID-19) pandemic; instability as a result of the UK's exit from the European Union (EU), the effects of the EU-UK Trade and Cooperation Agreement and the disruption that may subsequently result in the UK and globally; the risk of cyber-attacks, information or security breaches or technology failures on the Group's reputation, business or operations; the Group's ability to access funding; and the success of acquisitions, disposals and other strategic transactions. A number of these influences and factors are beyond the Group's control. As a result, the Group's actual financial position, future results, capital distributions, capital, leverage or other regulatory ratios or other financial and non-financial metrics or performance measures or ability to meet commitments and targets may differ materially from the statements or guidance set forth in the Group's forward-looking statements. Additional risks and factors which may impact the Group's future financial condition and performance are identified in Barclays PLC's filings with the SEC (including, without limitation, Barclays PLC's Annual Report on Form 20-F for the financial year ended 31 December 2021, as amended, and Interim Results Announcement for the six months ended 30 June 2022 filed on Form 6-K), which are available on the SEC's website at www.sec.gov.
Subject to Barclays' obligations under the applicable laws and regulations of any relevant jurisdiction (including, without limitation, the UK and the US), in relation to disclosure and ongoing information, we undertake no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Performance Highlights
Strong Q3 performance with profit before tax of £2.0bn and return on tangible equity (RoTE) of 12.5%, contributing to Q3 year to date profit before tax of £5.7bn and RoTE of 10.9%
C. S. Venkatakrishnan, Group Chief Executive, commented "We delivered another quarter of strong returns, and achieved income growth in each of our three businesses1, with a 17% increase in Group income to £6.4bn1. Our performance in FICC was particularly strong and we continued to build momentum in our consumer businesses in the UK and US. We are ready to provide support for customers and clients facing an uncertain economic environment and higher cost pressures. Whether helping retail customers to manage their finances or corporate clients navigate markets volatility, we will continue to be focused on meeting their needs." |
Key financial metrics:
Income | Cost: income ratio | Profit before tax | Attributable profit | RoTE | EPS | CET1 ratio | TNAV per share | |
Q322 | £6.0bn | 60% | £2.0bn | £1.5bn | 12.5% | 9.4p | 13.8% | 286p |
Q322 YTD | £19.2bn | 66% | £5.7bn | £4.0bn | 10.9% | 24.2p |
Q322 Performance highlights2:
· | Attributable profit was £1.5bn (Q321: £1.4bn) and RoTE was 12.5% (Q321: 11.4%) | |
· | Excluding the impact of the Over-issuance of Securities in the US (Over-issuance of Securities)3 | |
- | Group income was £6.4bn, up 17% year-on-year, with continued momentum in both Consumer, Cards and Payments (CC&P) and Barclays UK. Within Corporate and Investment Bank (CIB), strong client activity in Markets more than offset the impact of a reduced fee pool in Investment Banking. Group income benefited from the appreciation of USD against GBP | |
| - | Group operating expenses were £4.1bn, up 18% year-on-year. Within this, operating costs (which exclude all litigation and conduct) were £3.9bn, up 14% year-on-year driven by the appreciation of USD against GBP, impact of inflation and investment in the business |
· | On a statutory basis, including the impact of the Over-issuance of Securities: | |
- | Group income was £6.0bn, up 9% year-on-year, including an income reduction of £0.5bn from hedging arrangements in relation to the Over-issuance of Securities | |
- | Total Group operating expenses were £3.6bn (Q321: £3.6bn), including a provision reduction of £0.5bn in relation to the Over-issuance of Securities (Q321: £0.1bn charge) | |
- | The total impact of the Over-issuance of Securities, net of tax, was £29m positive in Q322 | |
· | Credit impairment charges were £0.4bn (Q321: £0.1bn). Delinquencies remained below historical levels and coverage levels have been broadly maintained at the portfolio level in light of an uncertain macroeconomic backdrop. The deteriorating macroeconomic forecast resulted in an increased charge, partially offset by consuming economic uncertainty post-model adjustments (PMAs), which were established in prior periods in anticipation of the future deterioration, which is now captured within the modelled output | |
· | Capital: Common Equity Tier 1 (CET1) ratio of 13.8% (December 2021: 15.1% and June 2022: 13.6%) and tangible net asset value (TNAV) per share of 286p (December 2021: 291p and June 2022: 297p) | |
· | Capital distributions: Barclays paid a half-year dividend of 2.25p per share on 16 September 2022, and completed a share buyback of £0.5bn on 3 October 2022, bringing the total capital return equivalent to c.5.25p per share as announced at H122 results | |
1 | Excluding the Q322 income reduction of £0.5bn from hedging arrangements related to the Over-issuance of Securities, CIB income was up 5% to £3.3bn and Group income was up 17% to £6.4bn in Q322 |
2 | 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
3 | Denotes the Over-issuance of Securities under Barclays Bank PLC's US shelf registration statements on Form F-3 filed with the SEC in 2018 and 2019. |
Outlook:
· | Returns: targeting a RoTE of greater than 10% in 2022 |
· | Income: diversified income streams position the Group well for the current economic and market environment including rising interest rates |
· | Costs: FY22 total operating expenses are expected to be in line with the outlook given at H122 results of around £16.7bn1, with a reduction in litigation and conduct charges of around £0.3bn broadly offset by headwinds from FX and other movements |
· | Impairment: expect the credit impairment charges at a portfolio level to trend towards a through-the-cycle loan loss rate, acknowledging the risk of further deterioration in the economic outlook |
· | Capital: targeting a CET1 ratio within the range of 13-14% |
· | Capital returns: capital distribution policy incorporates a progressive ordinary dividend, supplemented with buybacks as appropriate. Dividends will continue to be paid semi-annually, with the half year dividend expected to represent, under normal circumstances, around one-third of the total dividend for the year |
1 | Group cost outlook is based on an average USD/GBP FX rate of 1.12 in Q422 and subject to foreign currency movements. |
Barclays Group results | Nine months ended | Three months ended | |||||
30.09.22 | Restated1 30.09.21 | 30.09.22 | Restated1 30.09.21 | ||||
£m | £m | % Change | £m | £m | % Change | ||
Barclays UK | 5,289 | 4,837 | 9 | 1,916 | 1,638 | 17 | |
Corporate and Investment Bank | 10,792 | 9,702 | 11 | 2,821 | 3,129 | (10) | |
Consumer, Cards and Payments | 3,213 | 2,453 | 31 | 1,244 | 808 | 54 | |
Barclays International | 14,005 | 12,155 | 15 | 4,065 | 3,937 | 3 | |
Head Office | (139) | (212) | 34 | (30) | (110) | 73 | |
Total income | 19,155 | 16,780 | 14 | 5,951 | 5,465 | 9 | |
Credit impairment (charges)/releases | (722) | 622 | (381) | (120) | |||
Net operating income | 18,433 | 17,402 | 6 | 5,570 | 5,345 | 4 | |
Operating costs | (11,209) | (10,578) | (6) | (3,939) | (3,446) | (14) | |
Litigation and conduct | (1,518) | (305) | 339 | (129) | |||
Total operating expenses | (12,727) | (10,883) | (17) | (3,600) | (3,575) | (1) | |
Other net (expenses)/ income | (4) | 247 | (1) | 94 | |||
Profit before tax | 5,702 | 6,766 | (16) | 1,969 | 1,864 | 6 | |
Tax charge | (1,072) | (1,034) | (4) | (249) | (292) | 15 | |
Profit after tax | 4,630 | 5,732 | (19) | 1,720 | 1,572 | 9 | |
Non-controlling interests | (23) | (20) | (15) | (2) | (1) | ||
Other equity instrument holders | (620) | (586) | (6) | (206) | (197) | (5) | |
Attributable profit | 3,987 | 5,126 | (22) | 1,512 | 1,374 | 10 | |
Performance measures | |||||||
Return on average tangible shareholders' equity | 10.9% | 14.5% | 12.5% | 11.4% | |||
Average tangible shareholders' equity (£bn) | 48.8 | 47.1 | 48.6 | 48.3 | |||
Cost: income ratio | 66% | 65% | 60% | 65% | |||
Loan loss rate (bps) | 23 | (23) | 36 | 13 | |||
Basic earnings per share | 24.2p | 30.0p | 9.4p | 8.0p | |||
Basic weighted average number of shares (m) | 16,503 | 17,062 | (3) | 16,148 | 17,062 | (5) | |
Period end number of shares (m) | 15,888 | 16,851 | (6) | 15,888 | 16,851 | (6) | |
As at 30.09.22 | As at 30.06.22 | Restated1 As at 31.12.21 | Restated1 As at 30.09.21 | |
Balance sheet and capital management2 | £bn | £bn | £bn | £bn |
Loans and advances at amortised cost | 413.7 | 395.8 | 361.5 | 353.0 |
Loans and advances at amortised cost impairment coverage ratio | 1.4% | 1.4% | 1.6% | 1.7% |
Total assets | 1,726.9 | 1,589.2 | 1,384.3 | 1,406.5 |
Deposits at amortised cost | 574.4 | 568.7 | 519.4 | 510.2 |
Tangible net asset value per share | 286p | 297p | 291p | 286p |
Common equity tier 1 ratio | 13.8% | 13.6% | 15.1% | 15.3% |
Common equity tier 1 capital | 48.6 | 46.7 | 47.3 | 47.2 |
Risk weighted assets | 350.8 | 344.5 | 314.1 | 307.7 |
UK leverage ratio | 5.0% | 5.1% | 5.2% | 5.1% |
UK leverage exposure | 1,232.1 | 1,151.2 | 1,137.9 | 1,162.7 |
Average UK leverage ratio | 4.8% | 4.7% | 4.9% | 4.9% |
Average UK leverage exposure | 1,259.6 | 1,233.5 | 1,229.0 | 1,201.1 |
Funding and liquidity | ||||
Group liquidity pool (£bn) | 326 | 343 | 291 | 293 |
Liquidity coverage ratio | 151% | 156% | 168% | 161% |
Loan: deposit ratio | 72% | 70% | 70% | 69% |
1 | 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
2 | Refer to pages 39 to 45 for further information on how capital, Risk Weighted Assets (RWAs) and leverage are calculated. |
Reconciliation of financial results excluding the impact of the Over-issuance of Securities
Nine months ended 30.09.22 | Restated1 Nine months ended 30.09.21 | ||||||||
Statutory | Impact of the Over-issuance of Securities | Excluding impact of the Over-issuance of Securities | Statutory | Impact of the Over-issuance of Securities | Excluding impact of the Over-issuance of Securities | ||||
£m | £m | £m | £m | £m | £m | % Change | |||
Barclays UK | 5,289 | - | 5,289 | 4,837 | - | 4,837 | 9 | ||
Corporate and Investment Bank | 10,792 | 292 | 10,500 | 9,702 | - | 9,702 | 8 | ||
Consumer, Cards and Payments | 3,213 | - | 3,213 | 2,453 | - | 2,453 | 31 | ||
Barclays International | 14,005 | 292 | 13,713 | 12,155 | - | 12,155 | 13 | ||
Head Office | (139) | - | (139) | (212) | - | (212) | 34 | ||
Total income | 19,155 | 292 | 18,863 | 16,780 | - | 16,780 | 12 | ||
Credit impairment (charges)/releases | (722) | - | (722) | 622 | - | 622 | |||
Operating costs | (11,209) | - | (11,209) | (10,578) | - | (10,578) | (6) | ||
Litigation and conduct | (1,518) | (966) | (552) | (305) | (174) | (131) | |||
Total operating expenses | (12,727) | (966) | (11,761) | (10,883) | (174) | (10,709) | (10) | ||
Other net (expenses)/ income | (4) | - | (4) | 247 | - | 247 | |||
Profit before tax | 5,702 | (674) | 6,376 | 6,766 | (174) | 6,940 | (8) | ||
Attributable profit | 3,987 | (552) | 4,539 | 5,126 | (132) | 5,258 | (14) | ||
Average tangible shareholders' equity | 48.8 | 48.8 | 47.1 | 47.1 | |||||
Return on average tangible shareholders' equity | 10.9% | 12.4% | 14.5% | 14.9% | |||||
Three months ended 30.09.22 | Restated1 Three months ended 30.09.21 | ||||||||
Statutory | Impact of the Over-issuance of Securities | Excluding impact of the Over-issuance of Securities | Statutory | Impact of the Over-issuance of Securities | Excluding impact of the Over-issuance of Securities | ||||
£m | £m | £m | £m | £m | £m | % Change | |||
Barclays UK | 1,916 | - | 1,916 | 1,638 | - | 1,638 | 17 | ||
Corporate and Investment Bank | 2,821 | (466) | 3,287 | 3,129 | - | 3,129 | 5 | ||
Consumer, Cards and Payments | 1,244 | - | 1,244 | 808 | - | 808 | 54 | ||
Barclays International | 4,065 | (466) | 4,531 | 3,937 | - | 3,937 | 15 | ||
Head Office | (30) | - | (30) | (110) | - | (110) | 73 | ||
Total income | 5,951 | (466) | 6,417 | 5,465 | - | 5,465 | 17 | ||
Credit impairment charges | (381) | - | (381) | (120) | - | (120) | |||
Operating costs | (3,939) | - | (3,939) | (3,446) | - | (3,446) | (14) | ||
Litigation and conduct | 339 | 503 | (164) | (129) | (97) | (32) | |||
Total operating expenses | (3,600) | 503 | (4,103) | (3,575) | (97) | (3,478) | (18) | ||
Other net (expenses)/ income | (1) | - | (1) | 94 | - | 94 | |||
Profit before tax | 1,969 | 37 | 1,932 | 1,864 | (97) | 1,961 | (1) | ||
Attributable profit | 1,512 | 29 | 1,483 | 1,374 | (72) | 1,446 | 3 | ||
Average tangible shareholders' equity | 48.6 | 48.6 | 48.3 | 48.3 | |||||
Return on average tangible shareholders' equity | 12.5% | 12.2% | 11.4% | 12.0% | |||||
1 | 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Group Finance Director's Review
Group performance Q322 YTD1
· | Barclays delivered a profit before tax of £5,702m (Q321 YTD: £6,766m), RoTE of 10.9% (Q321 YTD: 14.5%), and earnings per share (EPS) of 24.2p (Q321 YTD: 30.0p) | |
· | The Group has a diverse income profile across businesses and geographies including a significant presence in the US. The 9% appreciation of average USD against GBP positively impacted income and profits and adversely impacted credit impairment charges and total operating expenses | |
· | Total income increased to £19,155m (Q321 YTD: £16,780m). Barclays UK income increased to £5,289m (Q321 YTD: £4,837m). Barclays International income increased to £14,005m (Q321 YTD: £12,155m), with CIB income increasing to £10,792m (Q321 YTD: £9,702m) and CC&P income increasing to £3,213m (Q321 YTD £2,453m). Excluding the income benefit of £292m from hedging arrangements related to the Over-issuance of Securities, total Group income was £18,863m, up 12% year-on-year, Barclays International income was £13,713m, up 13% year-on-year and CIB income was £10,500m, up 8% year-on-year | |
· | Credit impairment charges were £722m (Q321 YTD: £622m net release). Whilst delinquencies remained below historical levels, the deterioration in the macroeconomic forecast has been reflected in the total impairment provision as at 30 September 2022 of £6.4bn. The YTD credit impairment charges reflect consumption of £1.0bn of the PMAs for economic uncertainty, which is now captured in the modelled output, leaving a balance of £0.7bn | |
· | Total Group operating expenses increased to £12,727m (Q321 YTD: £10,883m) mainly due to higher litigation and conduct charges: | |
- | Operating costs (which exclude litigation and conduct charges) increased 6% to £11,209m, reflecting continued investment and business growth, the impact of inflation and the appreciation of average USD against GBP, partially offset by efficiency savings and the non-recurrence of structural cost actions primarily relating to the real estate review in June 2021 | |
- | Litigation and conduct charges were £1,518m (Q321 YTD: £305m) including £966m impact from the Over-issuance of Securities, £282m of customer remediation costs relating to legacy loan portfolios in CC&P and £165m related to the Devices Settlements2 recognised in Q222 | |
· | The effective tax rate (ETR) was 18.8% (Q321 YTD: 15.3%). The tax charge included £346m for the re-measurement of the Group's UK deferred tax assets (DTAs) due to the enactment of legislation in Q122 to reduce the UK banking surcharge rate from 8% to 3% effective from 1 April 2023. The ETR excluding the impact of this downward re-measurement of UK DTAs was 12.7%, reflecting the impact of tax benefits arising in the current year as well as beneficial adjustments in respect of prior years | |
· | Attributable profit was £3,987m (Q321 YTD: £5,126m) despite the £552m impact of the Over-issuance of Securities, delivering EPS of 24.2p for the year to date | |
· | Total assets increased to £1,726.9bn (December 2021: £1,384.3bn) reflecting higher levels of activity as we supported our clients through a period of market volatility, and the appreciation of USD against GBP | |
· | TNAV per share decreased to 286p (December 2021: 291p) with EPS of 24.2p and currency movements more than offset by net negative reserve movements due to higher interest rates, primarily in the cash flow hedging reserve | |
Capital distributions
· | Barclays paid a half-year dividend of 2.25p per share on 16 September 2022, and completed a share buyback of £0.5bn on 3 October 2022, bringing the total capital return equivalent to c.5.25p per share as announced at H122 results |
· | Barclays is committed to maintaining an appropriate balance between delivering attractive total cash returns to shareholders, investment in the business and maintaining a strong capital position. Barclays pays a progressive ordinary dividend, taking into account these objectives and the earnings outlook of the Group. The Board will also continue to supplement the ordinary dividends as appropriate, including with share buybacks |
· | Dividends will continue to be paid semi-annually, with the half year dividend expected to represent, under normal circumstances, around one-third of the total dividend for the year |
1 | 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
2 | Refers to the settlements with the SEC and Commodity Futures Trading Commission (CFTC) in connection with their investigations of the use of unauthorised devices for business communications. See Other matters on page 10. |
Barclays UK
Barclays UK delivered a RoTE of 18.7% (Q321 YTD: 17.9%) and a lower cost: income ratio of 60% (Q321 YTD: 66%), reflecting improved income performance whilst maintaining broadly stable total operating expenses. Barclays UK continues to navigate a challenging operating environment with a focus on supporting customers through affordability challenges and retaining elevated unsecured lending coverage ratios, while remaining well positioned to benefit from rising rates
· | Profit before tax was broadly in line at £1,979m (Q321 YTD: £1,957m), with the non-recurrence of a prior year credit impairment release offsetting benefits from the rising rate environment in the UK | |
· | Total income increased 9% to £5,289m. Net interest income increased 10% to £4,293m with a net interest margin of 2.78% (Q321 YTD: 2.53%) primarily driven by the rising interest rate environment in the UK. Net fee, commission and other income increased 5% to £996m | |
- | Personal Banking income increased 14% to £3,311m, driven by rising interest rates and the benefit of strong mortgage origination in 2021, partially offset by mortgage margin compression | |
- | Barclaycard Consumer UK income decreased 8% to £824m as higher transaction based revenues from improved customer spend volumes were more than offset by lower interest earning lending (IEL) balances. Lower IEL balances were impacted by higher customer repayments and reduced borrowing | |
- | Business Banking income increased 11% to £1,154m driven by rising interest rates alongside improved transaction based revenues, partially offset by lower government scheme lending income as repayments continue | |
· | Credit impairment charges were £129m (Q321 YTD: £306m net release) driven by a deteriorating macroeconomic forecast, in particular from customer vulnerability to high inflation and rising interest rates. This was partially offset by consuming economic uncertainty PMAs which were established in prior periods in anticipation of the future deterioration, which is now captured within the modelled output. As at 30 September 2022, 30 and 90 day arrears rates in UK cards were 1.0% (Q321: 1.0%) and 0.3% (Q321: 0.3%) respectively. The arrears rates in the UK cards business remain below historical levels although provision levels remain elevated in light of affordability headwinds as reflected in the UK credit card and consumer loan business total coverage ratio of 8.3% (December 2021: 10.9%) | |
· | Total operating expenses was broadly stable at £3,180m (Q321 YTD: £3,187m) driven by increased investment spend and the impact of inflation, offset by efficiency savings | |
· | Loans and advances to customers at amortised cost decreased 2% to £205.1bn as £3.1bn of mortgage growth was more than offset by a £7.3bn decrease in Business Banking balances due to the repayment of government scheme lending and the yield curve impact from rising interest rates on the Education, Social Housing and Local Authority portfolio carrying value | |
· | Customer deposits at amortised cost remained stable at £261.0bn (December 2021: £260.6bn), maintaining a strong loan: deposit ratio of 86% (December 2021: 85%) | |
· | RWAs remained broadly stable at £73.2bn (December 2021: £72.3bn) | |
Barclays International1
Barclays International delivered a RoTE of 11.5%, with a CIB RoTE of 11.9% reflecting the benefits of income diversification and continued investment in the business. CC&P delivered a RoTE of 8.9% as continued momentum across the business, including the GAP portfolio acquisition, was impacted by a provision for customer remediation costs relating to a legacy loan portfolio. | ||
· | Profit before tax decreased 22% to £4,169m with a RoTE of 11.5% (Q321 YTD: 15.9%), reflecting a RoTE of 11.9% (Q321 YTD: 15.8%) in CIB and 8.9% (Q321 YTD: 16.2%) in CC&P | |
· | Barclays International has a diverse income profile across businesses and geographies including a significant presence in the US. The 9% appreciation of average USD against GBP positively impacted income and profits and adversely impacted credit impairment charges, total operating expenses and RWAs | |
· | Total income increased to £14,005m (Q321 YTD: £12,155m) | |
- | CIB income increased 11% to £10,792m | |
- | Global Markets income increased 38% to £7,428m representing the best Q3 YTD for both Markets and FICC on a comparable basis2. FICC income increased 63% to £4,719m, mainly in macro, reflecting higher levels of activity as we supported our clients through a period of market volatility. Equities income of £2,709m (Q321 YTD: £2,466m) included £292m of income related to hedging arrangements to manage the risks of the rescission offer in relation to the Over-issuance of Securities | |
- | Investment Banking fees income decreased 36% to £1,735m due to the reduced fee pool, particularly in Equity and Debt capital markets3, and a strong prior year comparative | |
- | Within Corporate, Transaction banking income increased 42% to £1,732m driven by improved margins and balance growth in deposits, and higher fee income. Corporate lending income was an expense of £103m (Q321 YTD: £412m income) due to fair value losses on leverage finance lending of c.£255m net of mark to market gains on related hedges, of which c.£190m fair value losses was recognised in Q322, and higher costs of hedging and credit protection | |
- | CC&P income increased 31% to £3,213m | |
- | International Cards and Consumer Bank income increased 33% to £2,053m as higher average cards balances, including the impact of the GAP portfolio acquisition, were partially offset by higher customer acquisition costs | |
- | Private Bank income increased 25% to £729m, reflecting client balance growth and improved margins partially offset by the non-recurrence of a gain on a property sale in the prior year | |
- | Payments income increased 30% to £431m driven by turnover growth following the easing of lockdown restrictions in the past year | |
· | Credit impairment charges were £605m (Q321 YTD: £311m net release) driven by a deteriorating economic forecast | |
- | CIB credit impairment charge of £78m (Q321 YTD: £400m net release) was driven by a net increase in modelled impairment and single name wholesale loan charges partially offset by the benefit of credit protection. The prior year included a net release resulting from an improved macroeconomic outlook scenario refresh | |
- | CC&P credit impairment charges increased to £527m (Q321 YTD: £89m) driven by higher balances in US cards, including the day one impact of acquiring the GAP portfolio, and the deteriorating macroeconomic forecast, in particular from customer vulnerability to high inflation and rising interest rates. This was partially offset by consuming economic uncertainty PMAs which were established in prior periods in anticipation of the future deterioration, which is now captured within the modelled output . As at 30 September 2022, 30 and 90 day arrears in US cards were 2.0% (Q321: 1.5%) and 0.8% (Q321: 0.7%) respectively. The arrears rates in the US cards business remain below historical levels and continue to be supported by elevated provision levels in light of affordability headwinds as reflected in the total coverage ratio of 8.3% (December 2021: 10.6%) | |
· | Total operating expenses increased 29% to £9,254m | |
- | CIB total operating expenses increased 28% to £6,968m. Operating costs increased 11% to £5,834m driven by investment in talent, systems and technology, and the impact of inflation. Litigation and conduct charges were £1,134m (Q321 YTD: £178m) including £966m of rescission offer costs in relation to the Over-issuance of Securities and the £165m provision relating to the Devices Settlements4 recognised in Q222 | |
- | CC&P total operating expenses increased 31% to £2,286m primarily driven by £302m of litigation and conduct costs, mainly relating to provisions for higher customer remediation costs relating to a legacy loan portfolio. Operating costs increased 20% to £1,984m, including the impact of higher investment spend reflecting an increase in marketing and costs for existing and new partnerships | |
· | RWAs increased to £269.3bn (December 2021: £230.9bn) resulting from the impact of the appreciation of USD against GBP, increased client activity within CIB, regulatory changes that took effect from 1 January 2022 and higher CC&P balances driven mainly by the GAP portfolio acquisition | |
1 | 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
2 | Period covering Q114-Q322. Pre 2014 data was not restated following re-segmentation in Q116. |
3 | Data source: Dealogic for the period covering 1 January to 30 September 2022. |
4 | Refers to the settlements with the SEC and CFTC in connection with their investigations of the use of unauthorised devices for business communications. See Other matters on page 10. |
Head Office
· | Loss before tax was £446m (Q321 YTD: £517m) |
· | Total income was an expense of £139m (Q321 YTD: £212m) which primarily reflected hedge accounting, funding costs on legacy capital instruments, treasury items, as well as a £74m loss on sale arising from disposals of Barclays' equity stake in Absa Group Limited (Absa) in April 2022 and September 2022. This was partially offset by the gain of £86m from the sale and leaseback of UK data centres and the receipt of dividends from Absa prior to disposal |
· | Total operating expenses reduced to £293m (Q321 YTD: £519m) reflecting the non-recurrence of the £266m charge related to structural cost actions taken as part of the real estate review in June 2021, partially offset by higher litigation and conduct charges |
· | Other net income was an expense of £26m (Q321 YTD: £209m income) driven by a fair value loss on investments held by the Business Growth Fund in which Barclays has an associate interest |
· | RWAs reduced to £8.2bn (December 2021: £11.0bn) reflecting the disposals of Barclays' equity stake in Absa in April 2022 and September 2022 |
Group capital and leverage1
· | The reported CET1 ratio decreased by c.130bps to 13.8% (December 2021: 15.1%) as RWAs increased by £36.6bn to £350.8bn partially offset by a CET1 capital increase of £1.2bn to £48.6bn | ||
- | c.90bps largely driven by returns to shareholders including the 2.25p dividend paid in September 2022 and £1.5bn of share buybacks which have now completed. It also included £0.6bn of AT1 coupon payments and an accrual towards a FY22 dividend | ||
- | c.80bps reduction to the CET1 ratio due to the impact of regulatory change on 1 January 2022 as CET1 capital decreased by £1.7bn and RWAs increased by £6.6bn | ||
- | c.20bps reduction due to the impact of the Over-issuance of Securities reflecting the £0.6bn net of tax impact to CET1 capital | ||
- | Excluding the impacts above, the CET1 ratio increased by c.60bps reflecting an increase in CET1 capital of £6.5bn partially offset by a £30.0bn increase in RWAs: | ||
- | The £6.5bn increase in CET1 capital largely reflects profits offset by a decrease in the fair value through other comprehensive income reserve. An increase in the currency translation reserve was broadly offset by increases in RWAs due to the appreciation of USD against GBP | ||
- | The £30.0bn increase in RWAs was primarily due to foreign exchange movements, increased client activity within CIB and higher CC&P balances mainly driven by the GAP portfolio acquisition. This was marginally offset by the disposal of Barclays' equity stake in Absa | ||
· | The UK leverage ratio decreased to 5.0% (December 2021: 5.2%) primarily due to an increase in the leverage exposure of £94.2bn to £1,232.1bn partially offset by an increase in Tier 1 Capital of £2.3bn to £61.8bn | ||
1 | 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Group funding and liquidity
· | The liquidity pool was £326bn (December 2021: £291bn) and the liquidity coverage ratio (LCR) remained significantly above the 100% regulatory requirement at 151% (December 2021: 168%), equivalent to a surplus of £107bn (December 2021: £116bn). The increase in the liquidity pool, due to increased deposits and wholesale funding, was more than offset by increased net stress outflows resulting in a lower LCR ratio |
· | Wholesale funding outstanding, excluding repurchase agreements, was £188.9bn (December 2021: £167.5bn). The Group issued £9.3bn equivalent of minimum requirement for own funds and eligible liabilities (MREL) instruments from Barclays PLC (the Parent company) in the year to date. The Group has a strong MREL position with a ratio of 31.9% of RWAs which is in excess of its regulatory requirement of 28.4%, excluding the confidential institution specific PRA buffer. The Group remains above its MREL regulatory requirement including the PRA buffer |
Other matters
· | Over-issuance of Securities: consistent with Barclays' announcement on 30 September 2022 | |
- | Barclays recognised a net attributable loss of £0.6bn year to date (Q322 attributable profit of £29m), materially in line with the financial impact disclosed in the Barclays PLC (BPLC) and Barclays Bank PLC (BBPLC) H122 results. This included a monetary penalty of $200m (£165m1) following the resolution of the SEC's investigation of BPLC and BBPLC relating to the Over-issuance of Securities | |
- | The external counsel-led review (the Review) of the facts and circumstances relating to the over-issuance and the control environment related to such issuances is now complete. The Review found that the over-issuance occurred because Barclays did not put in place a mechanism to track issuances after BBPLC was subjected to a limit on issuance. Among the principal causes of the over-issuance were, first, the failure to identify and escalate to senior executives the consequences of the loss of well-known seasoned issuer status, and, secondly, a decentralised ownership structure for securities issuance | |
- | The Review further concluded that the over-issuance was not the result of a general lack of attention to controls by Barclays, and that Barclays' management has consistently emphasised the importance of maintaining effective controls | |
As previously disclosed, Barclays has a contingent liability in relation to current and potential private civil claims and other potential enforcement actions relating to the Over-issuance of Securities | ||
For further details see the "Update on related litigation and conduct matters" on page 52. | ||
· | SEC and CFTC devices investigation: further to the previously disclosed settlements in principle by BBPLC and Barclays Capital Inc. (BCI) with the SEC and CFTC in relation to their investigations of compliance with recordkeeping obligations in connection with business-related communications sent over unapproved electronic messaging platforms, in September 2022 the SEC and CFTC announced the final terms of the settlements, under which Barclays Bank PLC and BCI have agreed to pay a combined $125m (£103m1) civil monetary penalty to the SEC and a $75m (£62m1) civil monetary penalty to the CFTC | |
· | Legacy Loan Portfolio: a customer remediation provision of £282m has been recognised, of which £181m was recognised in Q122 relating to a legacy timeshare loan portfolio brokered by Azure Services Limited, and £101m was recognised in Q322 in relation to other legacy loan portfolios. Barclays continues to review complaints regarding these loans | |
· | Financial Conduct Authority (FCA) proceedings: further to the disclosures in the H122 results in relation to the FCA investigation into disclosure-related matters arising out of BPLC's June and November 2008 capital raisings: | |
- | In September 2022, the FCA's Regulatory Decisions Committee (RDC) issued Decision Notices finding that BPLC and BBPLC breached certain disclosure-related listing rules. The RDC also found that in relation to the disclosures made in the capital raising of November 2008, BPLC and BBPLC acted recklessly, and that BPLC breached Listing Principle 3. The RDC upheld the combined penalty of £50m on BPLC and BBPLC, the same penalty as in the Warning Notices issued by the FCA in relation to this matter in 2013 | |
- | BPLC and BBPLC have referred the RDC's findings to the Upper Tribunal for reconsideration | |
- | A provision for £50m has been recognised as at 30 September 2022 in relation to this matter and it is reported as a litigation and conduct expense within Head Office | |
· | GAP portfolio acquisition: on 21 June 2022 Barclays completed the acquisition of a US credit card portfolio of $3.3bn (£2.7bn2) of receivables, in partnership with GAP Inc. The acquisition reduced the Group CET1 ratio by approximately 15bps at Q222. The partnership broadens Barclays product offering in the retail sector and store cards, advancing our strategy and growth ambitions in the United States | |
· | Kensington Mortgage Company acquisition: on 24 June 2022 Barclays PLC announced that Barclays Bank UK PLC has agreed to acquire UK specialist mortgage lender Kensington Mortgage Company Limited, thereby broadening Barclays' capabilities and product offering in the UK mortgage market. The transaction is subject to regulatory approval and is expected to complete in late Q422 or early Q123 | |
· | Absa sale: on 21 April 2022, Barclays sold 63m ordinary shares in Absa (7.4% of Absa's issued share capital) at a price of ZAR 164.0 per share, raising aggregate gross sale proceeds of ZAR 10.3bn (£516m3). On 1 September 2022, Barclays sold its remaining shareholding of 63m ordinary shares in Absa at a price of ZAR 169.0 per share raising aggregate gross sale proceeds of ZAR 10.7bn (£535m4) | |
· | Pensions: during 2019 and 2020, the UK Retirement Fund, the Group's main pension scheme, subscribed for non-transferable listed senior fixed rate notes for £1.25bn. Following the PRA's statement on 13 April 2022, Barclays is planning to unwind these transactions in Q422, which is expected to result in an accelerated c.30bps reduction to the CET1 ratio, which otherwise would have been reflected in subsequent periods | |
· | UK Corporation Tax: an increase in the UK corporation tax rate from 19% to 25% was enacted in 2021 and a reduction in the UK banking surcharge from 8% to 3% was enacted in Q122, both to be effective from 1 April 2023. On 14 October 2022 the UK Government announced that it intended to proceed with the increase in the corporation tax rate and that an update on the banking surcharge will be provided as part of its Medium-Term Fiscal Plan currently scheduled for 31 October 2022. It is therefore expected that from 1 April 2023 the corporation tax rate will be 25%, while the future rate of banking surcharge remains uncertain | |
1 | Exchange rate GBP/USD 1.22 as at 30 June 2022. |
2 | Exchange rate GBP/USD 1.23 as at 21 June 2022 |
3 | Exchange rate GBP/ZAR 20.04 as at 21 April 2022. |
4 | Exchange rate GBP/ZAR 19.93 as at 1 September 2022. |
Group targets
Barclays continues to target the following over the medium term:
· | Returns: RoTE of greater than 10% |
· | Cost efficiency: cost: income ratio below 60% |
· | Capital adequacy: CET1 ratio in the range of 13-14% |
Anna Cross, Group Finance Director
Results by Business
Barclays UK | Nine months ended | Three months ended | |||||
30.09.22 | 30.09.21 | 30.09.22 | 30.09.21 | ||||
Income statement information | £m | £m | % Change | £m | £m | % Change | |
Net interest income | 4,293 | 3,889 | 10 | 1,561 | 1,303 | 20 | |
Net fee, commission and other income | 996 | 948 | 5 | 355 | 335 | 6 | |
Total income | 5,289 | 4,837 | 9 | 1,916 | 1,638 | 17 | |
Credit impairment (charges)/releases | (129) | 306 | (81) | (137) | 41 | ||
Net operating income | 5,160 | 5,143 | - | 1,835 | 1,501 | 22 | |
Operating costs | (3,152) | (3,155) | - | (1,069) | (1,041) | (3) | |
Litigation and conduct | (28) | (32) | 13 | (3) | (10) | 70 | |
Total operating expenses | (3,180) | (3,187) | - | (1,072) | (1,051) | (2) | |
Other net (expenses)/income | (1) | 1 | (1) | 1 | |||
Profit before tax | 1,979 | 1,957 | 1 | 762 | 451 | 69 | |
Attributable profit | 1,403 | 1,336 | 5 | 549 | 317 | 73 | |
Performance measures | |||||||
Return on average allocated tangible equity | 18.7% | 17.9% | 22.1% | 12.7% | |||
Average allocated tangible equity (£bn) | 10.0 | 9.9 | 9.9 | 10.0 | |||
Cost: income ratio | 60% | 66% | 56% | 64% | |||
Loan loss rate (bps) | 8 | (18) | 14 | 24 | |||
Net interest margin | 2.78% | 2.53% | 3.01% | 2.49% | |||
As at 30.09.22 | As at 31.12.21 | As at 30.09.21 | |||||
Balance sheet information | £bn | £bn | £bn | ||||
Loans and advances to customers at amortised cost | 205.1 | 208.8 | 208.6 | ||||
Total assets | 316.8 | 321.2 | 312.1 | ||||
Customer deposits at amortised cost | 261.0 | 260.6 | 256.8 | ||||
Loan: deposit ratio | 86% | 85% | 86% | ||||
Risk weighted assets | 73.2 | 72.3 | 73.2 | ||||
Period end allocated tangible equity | 10.1 | 10.0 | 10.0 | ||||
Analysis of Barclays UK | Nine months ended | Three months ended | |||||
30.09.22 | 30.09.21 | 30.09.22 | 30.09.21 | ||||
Analysis of total income | £m | £m | % Change | £m | £m | % Change | |
Personal Banking | 3,311 | 2,900 | 14 | 1,212 | 990 | 22 | |
Barclaycard Consumer UK | 824 | 898 | (8) | 283 | 293 | (3) | |
Business Banking | 1,154 | 1,039 | 11 | 421 | 355 | 19 | |
Total income | 5,289 | 4,837 | 9 | 1,916 | 1,638 | 17 | |
Analysis of credit impairment (charges)/releases | |||||||
Personal Banking | (47) | 20 |
| (26) | (30) | 13 | |
Barclaycard Consumer UK | 42 | 290 | (86) | 2 | (108) | ||
Business Banking | (124) | (4) |
| (57) | 1 | ||
Total credit impairment (charges)/releases | (129) | 306 |
| (81) | (137) | 41 | |
As at 30.09.22 | As at 31.12.21 | As at 30.09.21 | |||||
Analysis of loans and advances to customers at amortised cost | £bn | £bn | £bn | ||||
Personal Banking | 168.7 | 165.4 | 164.6 | ||||
Barclaycard Consumer UK | 9.0 | 8.7 | 8.6 | ||||
Business Banking | 27.4 | 34.7 | 35.4 | ||||
Total loans and advances to customers at amortised cost | 205.1 | 208.8 | 208.6 | ||||
Analysis of customer deposits at amortised cost | |||||||
Personal Banking | 197.3 | 196.4 | 193.3 | ||||
Barclaycard Consumer UK | - | - | - | ||||
Business Banking | 63.7 | 64.2 | 63.5 | ||||
Total customer deposits at amortised cost | 261.0 | 260.6 | 256.8 | ||||
Barclays International | Nine months ended | Three months ended | |||||
30.09.22 | Restated1 30.09.21 | 30.09.22 | Restated1 30.09.21 | ||||
Income statement information | £m | £m | % Change | £m | £m | % Change | |
Net interest income | 3,462 | 2,308 | 50 | 1,497 | 749 | ||
Net trading income | 6,540 | 4,904 | 33 | 1,328 | 1,515 | (12) | |
Net fee, commission and other income | 4,003 | 4,943 | (19) | 1,240 | 1,673 | (26) | |
Total income | 14,005 | 12,155 | 15 | 4,065 | 3,937 | 3 | |
Credit impairment (charges)/releases | (605) | 311 | (295) | 18 | |||
Net operating income | 13,400 | 12,466 | 7 | 3,770 | 3,955 | (5) | |
Operating costs | (7,818) | (6,916) | (13) | (2,776) | (2,310) | (20) | |
Litigation and conduct | (1,436) | (261) | 396 | (100) | |||
Total operating expenses | (9,254) | (7,177) | (29) | (2,380) | (2,410) | 1 | |
Other net income | 23 | 37 | (38) | 10 | 15 | (33) | |
Profit before tax | 4,169 | 5,326 | (22) | 1,400 | 1,560 | (10) | |
Attributable profit | 3,219 | 3,829 | (16) | 1,136 | 1,191 | (5) | |
Performance measures | |||||||
Return on average allocated tangible equity | 11.5% | 15.9% | 11.6% | 14.9% | |||
Average allocated tangible equity (£bn) | 37.2 | 32.2 | 39.1 | 31.8 | |||
Cost: income ratio | 66% | 59% | 59% | 61% | |||
Loan loss rate (bps) | 43 | (32) | 62 | (6) | |||
Net interest margin | 4.78% | 3.96% | 5.58% | 4.02% | |||
As at 30.09.22 | As at 31.12.21 | As at 30.09.21 | |||||
Balance sheet information | £bn | £bn | £bn | ||||
Loans and advances at amortised cost | 184.2 | 133.8 | 125.9 | ||||
Trading portfolio assets | 126.3 | 146.9 | 144.8 | ||||
Derivative financial instrument assets | 415.7 | 261.5 | 257.0 | ||||
Financial assets at fair value through the income statement | 244.7 | 188.2 | 200.5 | ||||
Cash collateral and settlement balances | 163.3 | 88.1 | 115.9 | ||||
Other assets | 257.2 | 225.6 | 231.8 | ||||
Total assets | 1,391.4 | 1,044.1 | 1,075.9 | ||||
Deposits at amortised cost | 313.2 | 258.8 | 253.3 | ||||
Derivative financial instrument liabilities | 394.2 | 256.4 | 252.3 | ||||
Loan: deposit ratio | 59% | 52% | 50% | ||||
Risk weighted assets | 269.3 | 230.9 | 222.7 | ||||
Period end allocated tangible equity | 38.8 | 33.2 | 31.8 | ||||
1 | 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Analysis of Barclays International | |||||||
Corporate and Investment Bank | Nine months ended | Three months ended | |||||
30.09.22 | Restated1 30.09.21 | 30.09.22 | Restated1 30.09.21 | ||||
Income statement information | £m | £m | % Change | £m | £m | % Change | |
Net interest income | 1,401 | 919 | 52 | 606 | 279 | ||
Net trading income | 6,532 | 4,878 | 34 | 1,344 | 1,467 | (8) | |
Net fee, commission and other income | 2,859 | 3,905 | (27) | 871 | 1,383 | (37) | |
Total income | 10,792 | 9,702 | 11 | 2,821 | 3,129 | (10) | |
Credit impairment (charges)/releases | (78) | 400 | (46) | 128 | |||
Net operating income | 10,714 | 10,102 | 6 | 2,775 | 3,257 | (15) | |
Operating costs | (5,834) | (5,256) | (11) | (2,043) | (1,747) | (17) | |
Litigation and conduct | (1,134) | (178) | 498 | (99) | |||
Total operating expenses | (6,968) | (5,434) | (28) | (1,545) | (1,846) | 16 | |
Other net income | - | 1 | - | - | |||
Profit before tax | 3,746 | 4,669 | (20) | 1,230 | 1,411 | (13) | |
Attributable profit | 2,910 | 3,337 | (13) | 1,015 | 1,085 | (6) | |
Performance measures | |||||||
Return on average allocated tangible equity | 11.9% | 15.8% | 11.9% | 15.6% | |||
Average allocated tangible equity (£bn) | 32.5 | 28.2 | 34.0 | 27.8 | |||
Cost: income ratio | 65% | 56% | 55% | 59% | |||
Loan loss rate (bps) | 7 | (56) | 13 | (54) | |||
As at 30.09.22 | As at 31.12.21 | As at 30.09.21 | |||||
Balance sheet information | £bn | £bn | £bn | ||||
Loans and advances at amortised cost | 140.0 | 100.0 | 93.8 | ||||
Trading portfolio assets | 126.1 | 146.7 | 144.7 | ||||
Derivative financial instrument assets | 415.5 | 261.5 | 256.9 | ||||
Financial assets at fair value through the income statement | 244.6 | 188.1 | 200.4 | ||||
Cash collateral and settlement balances | 162.6 | 87.2 | 115.1 | ||||
Other assets | 220.6 | 195.8 | 200.4 | ||||
Total assets | 1,309.4 | 979.3 | 1,011.3 | ||||
Deposits at amortised cost | 229.5 | 189.4 | 185.8 | ||||
Derivative financial instrument liabilities | 394.2 | 256.4 | 252.2 | ||||
Risk weighted assets | 230.6 | 200.7 | 192.5 | ||||
Analysis of total income | £m | £m | % Change | £m | £m | % Change | |
FICC | 4,719 | 2,902 | 63 | 1,546 | 803 | 93 | |
Equities | 2,709 | 2,466 | 10 | 246 | 757 | (68) | |
Global Markets | 7,428 | 5,368 | 38 | 1,792 | 1,560 | 15 | |
Advisory | 571 | 634 | (10) | 150 | 253 | (41) | |
Equity capital markets | 126 | 655 | (81) | 42 | 186 | (77) | |
Debt capital markets | 1,038 | 1,414 | (27) | 341 | 532 | (36) | |
Investment Banking fees | 1,735 | 2,703 | (36) | 533 | 971 | (45) | |
Corporate lending | (103) | 412 | (181) | 168 | |||
Transaction banking | 1,732 | 1,219 | 42 | 677 | 430 | 57 | |
Corporate | 1,629 | 1,631 | - | 496 | 598 | (17) | |
Total income | 10,792 | 9,702 | 11 | 2,821 | 3,129 | (10) | |
1 | 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Analysis of Barclays International | |||||||
Consumer, Cards and Payments | Nine months ended | Three months ended | |||||
30.09.22 | 30.09.21 | 30.09.22 | 30.09.21 | ||||
Income statement information | £m | £m | % Change | £m | £m | % Change | |
Net interest income | 2,061 | 1,390 | 48 | 891 | 471 | 89 | |
Net fee, commission, trading and other income | 1,152 | 1,063 | 8 | 353 | 337 | 5 | |
Total income | 3,213 | 2,453 | 31 | 1,244 | 808 | 54 | |
Credit impairment charges | (527) | (89) | (249) | (110) | |||
Net operating income | 2,686 | 2,364 | 14 | 995 | 698 | 43 | |
Operating costs | (1,984) | (1,660) | (20) | (733) | (563) | (30) | |
Litigation and conduct | (302) | (83) | (102) | (1) | |||
Total operating expenses | (2,286) | (1,743) | (31) | (835) | (564) | (48) | |
Other net income | 23 | 36 | (36) | 10 | 15 | (33) | |
Profit before tax | 423 | 657 | (36) | 170 | 149 | 14 | |
Attributable profit | 309 | 492 | (37) | 121 | 106 | 14 | |
Performance measures | |||||||
Return on average allocated tangible equity | 8.9% | 16.2% | 9.5% | 10.5% | |||
Average allocated tangible equity (£bn) | 4.7 | 4.0 | 5.1 | 4.0 | |||
Cost: income ratio | 71% | 71% | 67% | 70% | |||
Loan loss rate (bps) | 150 | 35 | 211 | 127 | |||
As at 30.09.22 | As at 31.12.21 | As at 30.09.21 | |||||
Balance sheet information | £bn | £bn | £bn | ||||
Loans and advances at amortised cost | 44.2 | 33.8 | 32.1 | ||||
Total assets | 82.0 | 64.8 | 64.6 | ||||
Deposits at amortised cost | 83.7 | 69.4 | 67.5 | ||||
Risk weighted assets | 38.7 | 30.2 | 30.2 | ||||
Analysis of total income | £m | £m | % Change | £m | £m | % Change | |
International Cards and Consumer Bank | 2,053 | 1,540 | 33 | 824 | 490 | 68 | |
Private Bank | 729 | 581 | 25 | 270 | 188 | 44 | |
Payments | 431 | 332 | 30 | 150 | 130 | 15 | |
Total income | 3,213 | 2,453 | 31 | 1,244 | 808 | 54 | |
Head Office | Nine months ended | Three months ended | |||||
30.09.22 | 30.09.21 | 30.09.22 | 30.09.21 | ||||
Income statement information | £m | £m | % Change | £m | £m | % Change | |
Net interest income | 76 | (354) | 10 | (112) | |||
Net fee, commission and other income | (215) | 142 | (40) | 2 | |||
Total income | (139) | (212) | 34 | (30) | (110) | 73 | |
Credit impairment releases/(charges) | 12 | 5 | (5) | (1) | |||
Net operating income | (127) | (207) | 39 | (35) | (111) | 68 | |
Operating costs | (239) | (507) | 53 | (94) | (95) | 1 | |
Litigation and conduct | (54) | (12) | (54) | (19) | |||
Total operating expenses | (293) | (519) | 44 | (148) | (114) | (30) | |
Other net (expenses)/income | (26) | 209 | (10) | 78 | |||
Loss before tax | (446) | (517) | 14 | (193) | (147) | (31) | |
Attributable loss | (635) | (39) | (173) | (134) | (29) | ||
Performance measures | |||||||
Average allocated tangible equity (£bn) | 1.6 | 5.0 | (0.4) | 6.5 | |||
As at 30.09.22 | Restated1 As at 31.12.21 | Restated1 As at 30.09.21 | |||||
Balance sheet information | £bn | £bn | £bn | ||||
Total assets | 18.7 | 19.0 | 18.5 | ||||
Risk weighted assets | 8.2 | 11.0 | 11.8 | ||||
Period end allocated tangible equity | (3.5) | 5.5 | 6.3 | ||||
1 | 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Quarterly Results Summary
Barclays Group | ||||||||||
Q322 | Q222 | Q122 | Q4211 | Q3211 | Q2211 | Q121 | Q420 | |||
Income statement information | £m | £m | £m | £m | £m | £m | £m | £m | ||
Net interest income | 3,068 | 2,422 | 2,341 | 2,230 | 1,940 | 2,052 | 1,851 | 1,845 | ||
Net fee, commission and other income | 2,883 | 4,286 | 4,155 | 2,930 | 3,525 | 3,363 | 4,049 | 3,096 | ||
Total income | 5,951 | 6,708 | 6,496 | 5,160 | 5,465 | 5,415 | 5,900 | 4,941 | ||
Credit impairment (charges)/releases | (381) | (200) | (141) | 31 | (120) | 797 | (55) | (492) | ||
Net operating income | 5,570 | 6,508 | 6,355 | 5,191 | 5,345 | 6,212 | 5,845 | 4,449 | ||
Operating costs | (3,939) | (3,682) | (3,588) | (3,514) | (3,446) | (3,587) | (3,545) | (3,480) | ||
UK bank levy | - | - | - | (170) | - | - | - | (299) | ||
Litigation and conduct | 339 | (1,334) | (523) | (92) | (129) | (143) | (33) | (47) | ||
Total operating expenses | (3,600) | (5,016) | (4,111) | (3,776) | (3,575) | (3,730) | (3,578) | (3,826) | ||
Other net (expenses)/income | (1) | 7 | (10) | 13 | 94 | 21 | 132 | 23 | ||
Profit before tax | 1,969 | 1,499 | 2,234 | 1,428 | 1,864 | 2,503 | 2,399 | 646 | ||
Tax charge | (249) | (209) | (614) | (104) | (292) | (246) | (496) | (163) | ||
Profit after tax | 1,720 | 1,290 | 1,620 | 1,324 | 1,572 | 2,257 | 1,903 | 483 | ||
Non-controlling interests | (2) | (20) | (1) | (27) | (1) | (15) | (4) | (37) | ||
Other equity instrument holders | (206) | (199) | (215) | (218) | (197) | (194) | (195) | (226) | ||
Attributable profit | 1,512 | 1,071 | 1,404 | 1,079 | 1,374 | 2,048 | 1,704 | 220 | ||
Performance measures | ||||||||||
Return on average tangible shareholders' equity | 12.5% | 8.7% | 11.5% | 9.0% | 11.4% | 17.6% | 14.7% | 1.8% | ||
Average tangible shareholders' equity (£bn) | 48.6 | 49.0 | 48.8 | 48.0 | 48.3 | 46.5 | 46.5 | 47.6 | ||
Cost: income ratio | 60% | 75% | 63% | 73% | 65% | 69% | 61% | 77% | ||
Loan loss rate (bps) | 36 | 20 | 15 | (3) | 13 | (90) | 6 | 56 | ||
Basic earnings per share | 9.4p | 6.4p | 8.4p | 6.4p | 8.0p | 11.9p | 9.9p | 1.3p | ||
Basic weighted average number of shares (m) | 16,148 | 16,684 | 16,682 | 16,985 | 17,062 | 17,140 | 17,293 | 17,300 | ||
Period end number of shares (m) | 15,888 | 16,531 | 16,762 | 16,752 | 16,851 | 16,998 | 17,223 | 17,359 | ||
Balance sheet and capital management2 | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | ||
Loans and advances at amortised cost | 413.7 | 395.8 | 371.7 | 361.5 | 353.0 | 348.5 | 345.8 | 342.6 | ||
Loans and advances at amortised cost impairment coverage ratio | 1.4% | 1.4% | 1.5% | 1.6% | 1.7% | 1.8% | 2.2% | 2.4% | ||
Total assets | 1,726.9 | 1,589.2 | 1,496.1 | 1,384.3 | 1,406.5 | 1,376.3 | 1,379.7 | 1,349.5 | ||
Deposits at amortised cost | 574.4 | 568.7 | 546.5 | 519.4 | 510.2 | 500.9 | 498.8 | 481.0 | ||
Tangible net asset value per share | 286p | 297p | 294p | 291p | 286p | 280p | 267p | 269p | ||
Common equity tier 1 ratio | 13.8% | 13.6% | 13.8% | 15.1% | 15.3% | 15.0% | 14.6% | 15.1% | ||
Common equity tier 1 capital | 48.6 | 46.7 | 45.3 | 47.3 | 47.2 | 46.2 | 45.9 | 46.3 | ||
Risk weighted assets | 350.8 | 344.5 | 328.8 | 314.1 | 307.7 | 307.4 | 313.4 | 306.2 | ||
UK leverage ratio | 5.0% | 5.1% | 5.0% | 5.2% | 5.1% | 5.0% | 5.0% | 5.3% | ||
UK leverage exposure | 1,232.1 | 1,151.2 | 1,123.5 | 1,137.9 | 1,162.7 | 1,154.9 | 1,145.4 | 1,090.9 | ||
Average UK leverage ratio | 4.8% | 4.7% | 4.8% | 4.9% | 4.9% | 4.8% | 4.9% | 5.0% | ||
Average UK leverage exposure | 1,259.6 | 1,233.5 | 1,179.4 | 1,229.0 | 1,201.1 | 1,192.7 | 1,174.9 | 1,146.9 | ||
Funding and liquidity | ||||||||||
Group liquidity pool (£bn) | 326 | 343 | 320 | 291 | 293 | 291 | 290 | 266 | ||
Liquidity coverage ratio | 151% | 156% | 159% | 168% | 161% | 162% | 161% | 162% | ||
Loan: deposit ratio | 72% | 70% | 68% | 70% | 69% | 70% | 69% | 71% |
1 | The comparative capital and financial metrics relating to Q221 - Q421 have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
2 | Refer to pages 39 to 45 for further information on how capital, RWAs and leverage are calculated. |
Quarterly Results by Business
Barclays UK | ||||||||||
Q322 | Q222 | Q122 | Q421 | Q321 | Q221 | Q121 | Q420 | |||
Income statement information | £m | £m | £m | £m | £m | £m | £m | £m | ||
Net interest income | 1,561 | 1,393 | 1,339 | 1,313 | 1,303 | 1,305 | 1,281 | 1,317 | ||
Net fee, commission and other income | 355 | 331 | 310 | 386 | 335 | 318 | 295 | 309 | ||
Total income | 1,916 | 1,724 | 1,649 | 1,699 | 1,638 | 1,623 | 1,576 | 1,626 | ||
Credit impairment (charges)/releases | (81) | - | (48) | 59 | (137) | 520 | (77) | (170) | ||
Net operating income | 1,835 | 1,724 | 1,601 | 1,758 | 1,501 | 2,143 | 1,499 | 1,456 | ||
Operating costs | (1,069) | (1,085) | (998) | (1,202) | (1,041) | (1,078) | (1,036) | (1,134) | ||
UK bank levy | - | - | - | (36) | - | - | - | (50) | ||
Litigation and conduct | (3) | (16) | (9) | (5) | (10) | (19) | (3) | 4 | ||
Total operating expenses | (1,072) | (1,101) | (1,007) | (1,243) | (1,051) | (1,097) | (1,039) | (1,180) | ||
Other net (expenses)/income | (1) | - | - | (1) | 1 | - | - | 6 | ||
Profit before tax | 762 | 623 | 594 | 514 | 451 | 1,046 | 460 | 282 | ||
Attributable profit | 549 | 458 | 396 | 420 | 317 | 721 | 298 | 160 | ||
Balance sheet information | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | ||
Loans and advances to customers at amortised cost | 205.1 | 205.9 | 207.3 | 208.8 | 208.6 | 207.8 | 205.7 | 205.4 | ||
Total assets | 316.8 | 318.8 | 317.2 | 321.2 | 312.1 | 311.2 | 309.1 | 289.1 | ||
Customer deposits at amortised cost | 261.0 | 261.5 | 260.3 | 260.6 | 256.8 | 255.5 | 247.5 | 240.5 | ||
Loan: deposit ratio | 86% | 85% | 85% | 85% | 86% | 87% | 88% | 89% | ||
Risk weighted assets | 73.2 | 72.2 | 72.7 | 72.3 | 73.2 | 72.2 | 72.7 | 73.7 | ||
Period end allocated tangible equity | 10.1 | 9.9 | 10.1 | 10.0 | 10.0 | 9.9 | 10.0 | 9.7 | ||
Performance measures | ||||||||||
Return on average allocated tangible equity | 22.1% | 18.4% | 15.6% | 16.8% | 12.7% | 29.1% | 12.0% | 6.5% | ||
Average allocated tangible equity (£bn) | 9.9 | 10.0 | 10.1 | 10.0 | 10.0 | 9.9 | 9.9 | 9.8 | ||
Cost: income ratio | 56% | 64% | 61% | 73% | 64% | 68% | 66% | 73% | ||
Loan loss rate (bps) | 14 | - | 9 | (10) | 24 | (93) | 14 | 31 | ||
Net interest margin | 3.01% | 2.71% | 2.62% | 2.49% | 2.49% | 2.55% | 2.54% | 2.56% |
Analysis of Barclays UK | Q322 | Q222 | Q122 | Q421 | Q321 | Q221 | Q121 | Q420 | ||
Analysis of total income | £m | £m | £m | £m | £m | £m | £m | £m | ||
Personal Banking | 1,212 | 1,077 | 1,022 | 983 | 990 | 987 | 923 | 895 | ||
Barclaycard Consumer UK | 283 | 265 | 276 | 352 | 293 | 290 | 315 | 354 | ||
Business Banking | 421 | 382 | 351 | 364 | 355 | 346 | 338 | 377 | ||
Total income | 1,916 | 1,724 | 1,649 | 1,699 | 1,638 | 1,623 | 1,576 | 1,626 | ||
Analysis of credit impairment (charges)/releases | ||||||||||
Personal Banking | (26) | (42) | 21 | 8 | (30) | 72 | (22) | (68) | ||
Barclaycard Consumer UK | 2 | 84 | (44) | 114 | (108) | 434 | (36) | (78) | ||
Business Banking | (57) | (42) | (25) | (63) | 1 | 14 | (19) | (24) | ||
Total credit impairment (charges)/releases | (81) | - | (48) | 59 | (137) | 520 | (77) | (170) | ||
Analysis of loans and advances to customers at amortised cost | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | ||
Personal Banking | 168.7 | 167.1 | 166.5 | 165.4 | 164.6 | 162.4 | 160.4 | 157.3 | ||
Barclaycard Consumer UK | 9.0 | 8.8 | 8.4 | 8.7 | 8.6 | 8.8 | 8.7 | 9.9 | ||
Business Banking | 27.4 | 30.0 | 32.4 | 34.7 | 35.4 | 36.6 | 36.6 | 38.2 | ||
Total loans and advances to customers at amortised cost | 205.1 | 205.9 | 207.3 | 208.8 | 208.6 | 207.8 | 205.7 | 205.4 | ||
Analysis of customer deposits at amortised cost | ||||||||||
Personal Banking | 197.3 | 197.0 | 196.6 | 196.4 | 193.3 | 191.0 | 186.0 | 179.7 | ||
Barclaycard Consumer UK | - | - | - | - | - | 0.1 | 0.1 | 0.1 | ||
Business Banking | 63.7 | 64.5 | 63.7 | 64.2 | 63.5 | 64.4 | 61.4 | 60.7 | ||
Total customer deposits at amortised cost | 261.0 | 261.5 | 260.3 | 260.6 | 256.8 | 255.5 | 247.5 | 240.5 |
Barclays International | ||||||||||
Q322 | Q222 | Q122 | Q4211 | Q3211 | Q2211 | Q121 | Q420 | |||
Income statement information | £m | £m | £m | £m | £m | £m | £m | £m | ||
Net interest income | 1,497 | 1,029 | 936 | 955 | 749 | 811 | 748 | 614 | ||
Net trading income | 1,328 | 2,766 | 2,446 | 789 | 1,515 | 1,455 | 1,934 | 1,372 | ||
Net fee, commission and other income | 1,240 | 1,321 | 1,442 | 1,766 | 1,673 | 1,553 | 1,717 | 1,500 | ||
Total income | 4,065 | 5,116 | 4,824 | 3,510 | 3,937 | 3,819 | 4,399 | 3,486 | ||
Credit impairment (charges)/releases | (295) | (209) | (101) | (23) | 18 | 271 | 22 | (291) | ||
Net operating income | 3,770 | 4,907 | 4,723 | 3,487 | 3,955 | 4,090 | 4,421 | 3,195 | ||
Operating costs | (2,776) | (2,537) | (2,505) | (2,160) | (2,310) | (2,168) | (2,438) | (2,133) | ||
UK bank levy | - | - | - | (134) | - | - | - | (240) | ||
Litigation and conduct | 396 | (1,319) | (513) | (84) | (100) | (140) | (21) | (9) | ||
Total operating expenses | (2,380) | (3,856) | (3,018) | (2,378) | (2,410) | (2,308) | (2,459) | (2,382) | ||
Other net income | 10 | 5 | 8 | 3 | 15 | 13 | 9 | 9 | ||
Profit before tax | 1,400 | 1,056 | 1,713 | 1,112 | 1,560 | 1,795 | 1,971 | 822 | ||
Attributable profit | 1,136 | 783 | 1,300 | 818 | 1,191 | 1,207 | 1,431 | 441 | ||
Balance sheet information | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | ||
Loans and advances at amortised cost | 184.2 | 167.3 | 144.8 | 133.8 | 125.9 | 121.9 | 123.5 | 122.7 | ||
Trading portfolio assets | 126.3 | 126.9 | 134.1 | 146.9 | 144.8 | 147.1 | 131.1 | 127.7 | ||
Derivative financial instrument assets | 415.7 | 343.5 | 288.8 | 261.5 | 257.0 | 255.4 | 269.4 | 301.8 | ||
Financial assets at fair value through the income statement | 244.7 | 209.3 | 203.8 | 188.2 | 200.5 | 190.4 | 197.5 | 170.7 | ||
Cash collateral and settlement balances | 163.3 | 128.5 | 132.0 | 88.1 | 115.9 | 108.5 | 109.7 | 97.5 | ||
Other assets | 257.2 | 275.1 | 255.5 | 225.6 | 231.8 | 223.5 | 221.7 | 221.4 | ||
Total assets | 1,391.4 | 1,250.6 | 1,159.0 | 1,044.1 | 1,075.9 | 1,046.8 | 1,052.9 | 1,041.8 | ||
Deposits at amortised cost | 313.2 | 307.4 | 286.1 | 258.8 | 253.3 | 245.4 | 251.2 | 240.5 | ||
Derivative financial instrument liabilities | 394.2 | 321.2 | 277.2 | 256.4 | 252.3 | 246.9 | 260.2 | 300.4 | ||
Loan: deposit ratio | 59% | 54% | 51% | 52% | 50% | 50% | 49% | 51% | ||
Risk weighted assets | 269.3 | 263.8 | 245.1 | 230.9 | 222.7 | 223.2 | 230.0 | 222.3 | ||
Period end allocated tangible equity | 38.8 | 38.0 | 35.6 | 33.2 | 31.8 | 31.8 | 32.7 | 30.2 | ||
Performance measures | ||||||||||
Return on average allocated tangible equity | 11.6% | 8.4% | 14.8% | 9.9% | 14.9% | 14.9% | 17.7% | 5.8% | ||
Average allocated tangible equity (£bn) | 39.1 | 37.3 | 35.1 | 32.9 | 31.8 | 32.4 | 32.3 | 30.5 | ||
Cost: income ratio | 59% | 75% | 63% | 68% | 61% | 60% | 56% | 68% | ||
Loan loss rate (bps) | 62 | 49 | 28 | 7 | (6) | (87) | (7) | 90 | ||
Net interest margin | 5.58% | 4.52% | 4.15% | 4.14% | 4.02% | 3.96% | 3.92% | 3.41% |
1 | The comparative capital and financial metrics relating to Q221 - Q421 have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Analysis of Barclays International | ||||||||||
Corporate and Investment Bank | Q322 | Q222 | Q122 | Q4211 | Q3211 | Q2211 | Q121 | Q420 | ||
Income statement information | £m | £m | £m | £m | £m | £m | £m | £m | ||
Net interest income | 606 | 410 | 385 | 432 | 279 | 370 | 270 | 110 | ||
Net trading income | 1,344 | 2,738 | 2,450 | 774 | 1,467 | 1,494 | 1,917 | 1,397 | ||
Net fee, commission and other income | 871 | 885 | 1,103 | 1,426 | 1,383 | 1,115 | 1,407 | 1,131 | ||
Total income | 2,821 | 4,033 | 3,938 | 2,632 | 3,129 | 2,979 | 3,594 | 2,638 | ||
Credit impairment (charges)/releases | (46) | (65) | 33 | 73 | 128 | 229 | 43 | (52) | ||
Net operating income | 2,775 | 3,968 | 3,971 | 2,705 | 3,257 | 3,208 | 3,637 | 2,586 | ||
Operating costs | (2,043) | (1,870) | (1,921) | (1,562) | (1,747) | (1,623) | (1,886) | (1,603) | ||
UK bank levy | - | - | - | (128) | - | - | - | (226) | ||
Litigation and conduct | 498 | (1,314) | (318) | (59) | (99) | (78) | (1) | 2 | ||
Total operating expenses | (1,545) | (3,184) | (2,239) | (1,749) | (1,846) | (1,701) | (1,887) | (1,827) | ||
Other net income | - | - | - | 1 | - | - | 1 | 2 | ||
Profit before tax | 1,230 | 784 | 1,732 | 957 | 1,411 | 1,507 | 1,751 | 761 | ||
Attributable profit | 1,015 | 579 | 1,316 | 695 | 1,085 | 989 | 1,263 | 413 | ||
Balance sheet information | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | ||
Loans and advances at amortised cost | 140.0 | 125.8 | 109.6 | 100.0 | 93.8 | 91.0 | 94.3 | 92.4 | ||
Trading portfolio assets | 126.1 | 126.7 | 134.0 | 146.7 | 144.7 | 147.0 | 130.9 | 127.5 | ||
Derivative financial instruments assets | 415.5 | 343.4 | 288.7 | 261.5 | 256.9 | 255.3 | 269.4 | 301.7 | ||
Financial assets at fair value through the income statement | 244.6 | 209.2 | 203.8 | 188.1 | 200.4 | 190.3 | 197.3 | 170.4 | ||
Cash collateral and settlement balances | 162.6 | 127.7 | 131.2 | 87.2 | 115.1 | 107.7 | 108.8 | 96.7 | ||
Other assets | 220.6 | 237.2 | 222.5 | 195.8 | 200.4 | 192.5 | 190.8 | 194.9 | ||
Total assets | 1,309.4 | 1,170.0 | 1,089.8 | 979.3 | 1,011.3 | 983.8 | 991.5 | 983.6 | ||
Deposits at amortised cost | 229.5 | 229.5 | 214.7 | 189.4 | 185.8 | 178.2 | 185.2 | 175.2 | ||
Derivative financial instrument liabilities | 394.2 | 321.2 | 277.1 | 256.4 | 252.2 | 246.8 | 260.2 | 300.3 | ||
Risk weighted assets | 230.6 | 227.6 | 213.5 | 200.7 | 192.5 | 194.3 | 201.3 | 192.2 | ||
Performance measures | ||||||||||
Return on average allocated tangible equity | 11.9% | 7.1% | 17.1% | 9.7% | 15.6% | 14.0% | 17.9% | 6.3% | ||
Average allocated tangible equity (£bn) | 34.0 | 32.7 | 30.8 | 28.7 | 27.8 | 28.4 | 28.2 | 26.3 | ||
Cost: income ratio | 55% | 79% | 57% | 66% | 59% | 57% | 53% | 69% | ||
Loan loss rate (bps) | 13 | 20 | (12) | (29) | (54) | (100) | (18) | 22 | ||
Analysis of total income | £m | £m | £m | £m | £m | £m | £m | £m | ||
FICC | 1,546 | 1,529 | 1,644 | 546 | 803 | 895 | 1,204 | 812 | ||
Equities | 246 | 1,411 | 1,052 | 501 | 757 | 777 | 932 | 542 | ||
Global Markets | 1,792 | 2,940 | 2,696 | 1,047 | 1,560 | 1,672 | 2,136 | 1,354 | ||
Advisory | 150 | 236 | 185 | 287 | 253 | 218 | 163 | 232 | ||
Equity capital markets | 42 | 37 | 47 | 158 | 186 | 226 | 243 | 104 | ||
Debt capital markets | 341 | 281 | 416 | 511 | 532 | 429 | 453 | 418 | ||
Investment Banking fees | 533 | 554 | 648 | 956 | 971 | 873 | 859 | 754 | ||
Corporate lending | (181) | (47) | 125 | 176 | 168 | 38 | 206 | 186 | ||
Transaction banking | 677 | 586 | 469 | 453 | 430 | 396 | 393 | 344 | ||
Corporate | 496 | 539 | 594 | 629 | 598 | 434 | 599 | 530 | ||
Total income | 2,821 | 4,033 | 3,938 | 2,632 | 3,129 | 2,979 | 3,594 | 2,638 |
1 | The comparative capital and financial metrics relating to Q221 - Q421 have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Analysis of Barclays International | ||||||||||
Consumer, Cards and Payments | Q322 | Q222 | Q122 | Q421 | Q321 | Q221 | Q121 | Q420 | ||
Income statement information | £m | £m | £m | £m | £m | £m | £m | £m | ||
Net interest income | 891 | 619 | 551 | 522 | 471 | 441 | 478 | 504 | ||
Net fee, commission, trading and other income | 353 | 464 | 335 | 356 | 337 | 399 | 327 | 344 | ||
Total income | 1,244 | 1,083 | 886 | 878 | 808 | 840 | 805 | 848 | ||
Credit impairment (charges)/releases | (249) | (144) | (134) | (96) | (110) | 42 | (21) | (239) | ||
Net operating income | 995 | 939 | 752 | 782 | 698 | 882 | 784 | 609 | ||
Operating costs | (733) | (667) | (584) | (598) | (563) | (545) | (552) | (530) | ||
UK bank levy | - | - | - | (6) | - | - | - | (14) | ||
Litigation and conduct | (102) | (5) | (195) | (25) | (1) | (62) | (20) | (11) | ||
Total operating expenses | (835) | (672) | (779) | (629) | (564) | (607) | (572) | (555) | ||
Other net income | 10 | 5 | 8 | 2 | 15 | 13 | 8 | 7 | ||
Profit/(loss) before tax | 170 | 272 | (19) | 155 | 149 | 288 | 220 | 61 | ||
Attributable profit/(loss) | 121 | 204 | (16) | 123 | 106 | 218 | 168 | 28 | ||
Balance sheet information | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | ||
Loans and advances at amortised cost | 44.2 | 41.5 | 35.2 | 33.8 | 32.1 | 30.9 | 29.2 | 30.3 | ||
Total assets | 82.0 | 80.6 | 69.2 | 64.8 | 64.6 | 63.0 | 61.4 | 58.2 | ||
Deposits at amortised cost | 83.7 | 77.9 | 71.4 | 69.4 | 67.5 | 67.2 | 66.0 | 65.3 | ||
Risk weighted assets | 38.7 | 36.2 | 31.6 | 30.2 | 30.2 | 29.0 | 28.8 | 30.1 | ||
Performance measures | ||||||||||
Return on average allocated tangible equity | 9.5% | 17.8% | (1.5)% | 11.7% | 10.5% | 21.8% | 16.5% | 2.7% | ||
Average allocated tangible equity (£bn) | 5.1 | 4.6 | 4.3 | 4.2 | 4.0 | 4.0 | 4.1 | 4.2 | ||
Cost: income ratio | 67% | 62% | 88% | 72% | 70% | 72% | 71% | 65% | ||
Loan loss rate (bps) | 211 | 132 | 145 | 105 | 127 | (49) | 27 | 286 | ||
Analysis of total income | £m | £m | £m | £m | £m | £m | £m | £m | ||
International Cards and Consumer Bank | 824 | 691 | 538 | 552 | 490 | 517 | 533 | 576 | ||
Private Bank | 270 | 245 | 214 | 200 | 188 | 214 | 179 | 174 | ||
Payments | 150 | 147 | 134 | 126 | 130 | 109 | 93 | 98 | ||
Total income | 1,244 | 1,083 | 886 | 878 | 808 | 840 | 805 | 848 |
Head Office | ||||||||||
Q322 | Q222 | Q122 | Q421 | Q321 | Q221 | Q121 | Q420 | |||
Income statement information | £m | £m | £m | £m | £m | £m | £m | £m | ||
Net interest income | 10 | - | 66 | (38) | (112) | (64) | (178) | (86) | ||
Net fee, commission and other income | (40) | (132) | (43) | (11) | 2 | 37 | 103 | (85) | ||
Total income | (30) | (132) | 23 | (49) | (110) | (27) | (75) | (171) | ||
Credit impairment (charges)/releases | (5) | 9 | 8 | (5) | (1) | 6 | - | (31) | ||
Net operating income | (35) | (123) | 31 | (54) | (111) | (21) | (75) | (202) | ||
Operating costs | (94) | (60) | (85) | (152) | (95) | (341) | (71) | (213) | ||
UK bank levy | - | - | - | - | - | - | - | (9) | ||
Litigation and conduct | (54) | 1 | (1) | (3) | (19) | 16 | (9) | (42) | ||
Total operating expenses | (148) | (59) | (86) | (155) | (114) | (325) | (80) | (264) | ||
Other net (expenses)/income | (10) | 2 | (18) | 11 | 78 | 8 | 123 | 8 | ||
Loss before tax | (193) | (180) | (73) | (198) | (147) | (338) | (32) | (458) | ||
Attributable (loss)/profit | (173) | (170) | (292) | (159) | (134) | 120 | (25) | (381) | ||
Balance sheet information | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | ||
Total assets | 18.7 | 19.8 | 19.9 | 19.0 | 18.5 | 18.3 | 17.7 | 18.6 | ||
Risk weighted assets1 | 8.2 | 8.6 | 11.0 | 11.0 | 11.8 | 12.0 | 10.7 | 10.2 | ||
Period end allocated tangible equity1 | (3.5) | 1.1 | 3.6 | 5.5 | 6.3 | 5.9 | 3.3 | 6.8 | ||
Performance measures1 | ||||||||||
Average allocated tangible equity (£bn) | (0.4) | 1.7 | 3.6 | 5.1 | 6.5 | 4.2 | 4.3 | 7.3 |
1 | The comparative capital and financial metrics relating to Q221 - Q421 have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Performance Management
Margins and balances | ||||||
Nine months ended 30.09.22 | Nine months ended 30.09.21 | |||||
Net interest income | Average customer assets | Net interest margin | Net interest income | Average customer assets | Net interest margin | |
£m | £m | % | £m | £m | % | |
Barclays UK | 4,293 | 206,308 | 2.78 | 3,889 | 205,889 | 2.53 |
Barclays International1 | 3,302 | 92,441 | 4.78 | 2,301 | 77,628 | 3.96 |
Total Barclays UK and Barclays International | 7,595 | 298,749 | 3.40 | 6,190 | 283,517 | 2.92 |
Other2 | 236 | (347) | ||||
Total Barclays Group | 7,831 | 5,843 | ||||
1 | Barclays International margins include the lending related investment bank business. |
2 | Other includes Head Office and the non-lending related investment bank businesses not included in Barclays International margins. |
The Group's combined product and equity structural hedge notional as at 30 September 2022 was £266bn (30 September 2021: £224bn), with an average duration of close to 3 years (2021: average duration close to 3 years). Gross structural hedge contributions of £1,487m (Q321 YTD: £1,042m) and net structural hedge contributions of £(361)m (Q321 YTD: £889m) are included in Group net interest income. Gross structural hedge contributions represent the absolute level of interest earned from the fixed receipts on swaps in the structural hedge, while the net structural hedge contributions represent the net interest earned on the difference between the structural hedge rate and prevailing floating rates.
Quarterly analysis for Barclays UK and Barclays International | Net interest income | Average customer assets | Net interest margin |
Three months ended 30.09.22 | £m | £m | % |
Barclays UK | 1,561 | 205,881 | 3.01 |
Barclays International1 | 1,420 | 100,910 | 5.58 |
Total Barclays UK and Barclays International | 2,981 | 306,791 | 3.85 |
Three months ended 30.06.22 | |||
Barclays UK | 1,393 | 205,834 | 2.71 |
Barclays International1 | 1,016 | 92,371 | 4.41 |
Total Barclays UK and Barclays International | 2,409 | 298,205 | 3.24 |
Three months ended 31.03.22 | |||
Barclays UK | 1,339 | 207,607 | 2.62 |
Barclays International1 | 867 | 84,838 | 4.15 |
Total Barclays UK and Barclays International | 2,206 | 292,445 | 3.06 |
Three months ended 31.12.21 | |||
Barclays UK | 1,313 | 209,064 | 2.49 |
Barclays International1 | 848 | 81,244 | 4.14 |
Total Barclays UK and Barclays International | 2,161 | 290,308 | 2.95 |
Three months ended 30.09.21 | |||
Barclays UK | 1,303 | 207,692 | 2.49 |
Barclays International1 | 783 | 77,364 | 4.02 |
Total Barclays UK and Barclays International | 2,086 | 285,056 | 2.90 |
1 | Barclays International margins include the lending related investment bank business. |
Credit Risk
Loans and advances at amortised cost by stage
The table below presents a stage allocation and business segment analysis of loans and advances at amortised cost by gross exposure, impairment allowance, impairment charge and coverage ratio as at 30 September 2022. Also included are a stage allocation of off-balance sheet loan commitments and financial guarantee contracts by gross exposure, impairment allowance and coverage as at 30 September 2022.
Impairment allowance under IFRS 9 considers both the drawn and the undrawn counterparty exposure. For retail portfolios, the total impairment allowance is allocated to gross loans and advances to the extent allowance does not exceed the drawn exposure and any excess is reported on the liabilities side of the balance sheet as a provision. For wholesale portfolios, impairment allowance on undrawn exposure is reported on the liability side of the balance sheet as a provision.
Gross exposure | Impairment allowance | Net exposure | ||||||||
Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | |||
As at 30.09.22 | £m | £m | £m | £m | £m | £m | £m | £m | £m | |
Barclays UK | 161,995 | 23,111 | 2,805 | 187,911 | 224 | 741 | 684 | 1,649 | 186,262 | |
Barclays International | 34,489 | 3,928 | 1,729 | 40,146 | 607 | 1,082 | 879 | 2,568 | 37,578 | |
Head Office | 3,749 | 233 | 674 | 4,656 | 3 | 21 | 353 | 377 | 4,279 | |
Total Barclays Group retail | 200,233 | 27,272 | 5,208 | 232,713 | 834 | 1,844 | 1,916 | 4,594 | 228,119 | |
Barclays UK | 35,598 | 2,700 | 842 | 39,140 | 146 | 97 | 88 | 331 | 38,809 | |
Barclays International | 129,621 | 16,710 | 1,136 | 147,467 | 282 | 247 | 324 | 853 | 146,614 | |
Head Office | 156 | - | 20 | 176 | - | - | 20 | 20 | 156 | |
Total Barclays Group wholesale1 | 165,375 | 19,410 | 1,998 | 186,783 | 428 | 344 | 432 | 1,204 | 185,579 | |
Total loans and advances at amortised cost | 365,608 | 46,682 | 7,206 | 419,496 | 1,262 | 2,188 | 2,348 | 5,798 | 413,698 | |
Off-balance sheet loan commitments and financial guarantee contracts2 | 396,483 | 30,856 | 1,231 | 428,570 | 284 | 282 | 26 | 592 | 427,978 | |
Total3 | 762,091 | 77,538 | 8,437 | 848,066 | 1,546 | 2,470 | 2,374 | 6,390 | 841,676 | |
As at 30.09.22 | Nine months ended 30.09.22 | |||||||||
Coverage ratio | Loan impairment charge/(release) and loan loss rate | |||||||||
Stage 1 | Stage 2 | Stage 3 | Total | Loan impairment charge/(release) | Loan loss rate | |||||
% | % | % | % | £m | bps | |||||
Barclays UK | 0.1 | 3.2 | 24.4 | 0.9 | 36 | 3 | ||||
Barclays International | 1.8 | 27.5 | 50.8 | 6.4 | 501 | 167 | ||||
Head Office | 0.1 | 9.0 | 52.4 | 8.1 | (12) | - | ||||
Total Barclays Group retail | 0.4 | 6.8 | 36.8 | 2.0 | 525 | 30 | ||||
Barclays UK | 0.4 | 3.6 | 10.5 | 0.8 | 87 | 30 | ||||
Barclays International | 0.2 | 1.5 | 28.5 | 0.6 | 79 | 7 | ||||
Head Office | - | - | 100.0 | 11.4 | ||||||
Total Barclays Group wholesale1 | 0.3 | 1.8 | 21.6 | 0.6 | 166 | 12 | ||||
Total loans and advances at amortised cost | 0.3 | 4.7 | 32.6 | 1.4 | 691 | 22 | ||||
Off-balance sheet loan commitments and financial guarantee contracts2 | 0.1 | 0.9 | 2.1 | 0.1 | (2) | |||||
Other financial assets subject to impairment3 | 33 | |||||||||
Total4 | 0.2 | 3.2 | 28.1 | 0.8 | 722 | |||||
1 | Includes Wealth UK and Private Banking exposures measured on an individual customer exposure basis and excludes Business Banking exposures, including lending under the government backed Bounce Back Loan Scheme (BBLS) of £7.4bn that are managed on a collective basis and reported within Barclays UK Retail. The net impact is a difference in total exposure of £3.5bn of balances reported as wholesale loans on page 28 in the Loans and advances at amortised cost by product disclosure. |
2 | Excludes loan commitments and financial guarantees of £18.2bn carried at fair value. |
3 | Other financial assets subject to impairment not included in the table above include cash collateral and settlement balances, financial assets at fair value through other comprehensive income and other assets. These have a total gross exposure of £237.0bn and impairment allowance of £168m. This comprises £12m ECL on £234.6bn Stage 1 assets, £8m on £2.3bn Stage 2 fair value through other comprehensive income assets, cash collateral and settlement balances and £147m on £155m Stage 3 other assets. |
4 | The loan loss rate is 23bps after applying the total impairment charge of £722m. |
Gross exposure | Impairment allowance | Net exposure | ||||||||
Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | |||
As at 31.12.21 | £m | £m | £m | £m | £m | £m | £m | £m | £m | |
Barclays UK | 160,695 | 22,779 | 2,915 | 186,389 | 261 | 949 | 728 | 1,938 | 184,451 | |
Barclays International | 25,981 | 2,691 | 1,566 | 30,238 | 603 | 795 | 858 | 2,256 | 27,982 | |
Head Office | 3,735 | 429 | 705 | 4,869 | 2 | 36 | 347 | 385 | 4,484 | |
Total Barclays Group retail | 190,411 | 25,899 | 5,186 | 221,496 | 866 | 1,780 | 1,933 | 4,579 | 216,917 | |
Barclays UK | 35,571 | 1,917 | 969 | 38,457 | 153 | 43 | 111 | 307 | 38,150 | |
Barclays International | 92,341 | 13,275 | 1,059 | 106,675 | 187 | 192 | 458 | 837 | 105,838 | |
Head Office | 542 | 2 | 21 | 565 | - | - | 19 | 19 | 546 | |
Total Barclays Group wholesale1 | 128,454 | 15,194 | 2,049 | 145,697 | 340 | 235 | 588 | 1,163 | 144,534 | |
Total loans and advances at amortised cost | 318,865 | 41,093 | 7,235 | 367,193 | 1,206 | 2,015 | 2,521 | 5,742 | 361,451 | |
Off-balance sheet loan commitments and financial guarantee contracts2 | 312,142 | 34,815 | 1,298 | 348,255 | 217 | 302 | 23 | 542 | 347,713 | |
Total3 | 631,007 | 75,908 | 8,533 | 715,448 | 1,423 | 2,317 | 2,544 | 6,284 | 709,164 | |
As at 31.12.21 | Year ended 31.12.21 | |||||||||
Coverage ratio | Loan impairment charge/(release) and loan loss rate | |||||||||
Stage 1 | Stage 2 | Stage 3 | Total | Loan impairment charge/(release) | Loan loss rate | |||||
% | % | % | % | £m | bps | |||||
Barclays UK | 0.2 | 4.2 | 25.0 | 1.0 | (227) | - | ||||
Barclays International | 2.3 | 29.5 | 54.8 | 7.5 | 181 | 60 | ||||
Head Office | 0.1 | 8.4 | 49.2 | 7.9 | - | - | ||||
Total Barclays Group retail | 0.5 | 6.9 | 37.3 | 2.1 | (46) | - | ||||
Barclays UK | 0.4 | 2.2 | 11.5 | 0.8 | 122 | 32 | ||||
Barclays International | 0.2 | 1.4 | 43.2 | 0.8 | (197) | - | ||||
Head Office | - | - | 90.5 | 3.4 | - | - | ||||
Total Barclays Group wholesale1 | 0.3 | 1.5 | 28.7 | 0.8 | (75) | - | ||||
Total loans and advances at amortised cost | 0.4 | 4.9 | 34.8 | 1.6 | (121) | - | ||||
Off-balance sheet loan commitments and financial guarantee contracts2 | 0.1 | 0.9 | 1.8 | 0.2 | (514) | |||||
Other financial assets subject to impairment3 | (18) | |||||||||
Total | 0.2 | 3.1 | 29.8 | 0.9 | (653) | |||||
1 | Includes Wealth and Private Banking exposures measured on an individual basis, and excludes Business Banking exposures, including BBLS of £9.4bn that are managed on a collective basis and reported within Barclays UK Retail. The net impact is a difference in total exposure of £6.0bn of balances reported as wholesale loans on page 28 in the Loans and advances at amortised cost by product disclosure. |
2 | Excludes loan commitments and financial guarantees of £18.8bn carried at fair value. |
3 | Other financial assets subject to impairment not included in the table above include cash collateral and settlement balances, financial assets at fair value through other comprehensive income and other assets. These have a total gross exposure of £155.2bn and impairment allowance of £114m. This comprises £6m ECL on £154.9bn Stage 1 assets, £1m on £157.0bn Stage 2 fair value through other comprehensive income assets, other assets and cash collateral and settlement balances and £107m on £110m Stage 3 other assets. |
Loans and advances at amortised cost by product
The table below presents a breakdown of loans and advances at amortised cost and the impairment allowance with stage allocation by asset classification.
Stage 2 | |||||||
As at 30.09.22 | Stage 1 | Not past due | >30 days past due | Total | Stage 3 | Total | |
Gross exposure | £m | £m | £m | £m | £m | £m | £m |
Home loans | 153,932 | 15,050 | 1,742 | 824 | 17,616 | 2,042 | 173,590 |
Credit cards, unsecured loans and other retail lending | 46,310 | 6,107 | 310 | 470 | 6,887 | 2,455 | 55,652 |
Wholesale loans | 165,366 | 21,656 | 375 | 148 | 22,179 | 2,709 | 190,254 |
Total | 365,608 | 42,813 | 2,427 | 1,442 | 46,682 | 7,206 | 419,496 |
Impairment allowance | |||||||
Home loans | 20 | 34 | 7 | 6 | 47 | 405 | 472 |
Credit cards, unsecured loans and other retail lending | 793 | 1,478 | 115 | 167 | 1,760 | 1,426 | 3,979 |
Wholesale loans | 449 | 376 | 4 | 1 | 381 | 517 | 1,347 |
Total | 1,262 | 1,888 | 126 | 174 | 2,188 | 2,348 | 5,798 |
Net exposure | |||||||
Home loans | 153,912 | 15,016 | 1,735 | 818 | 17,569 | 1,637 | 173,118 |
Credit cards, unsecured loans and other retail lending | 45,517 | 4,629 | 195 | 303 | 5,127 | 1,029 | 51,673 |
Wholesale loans | 164,917 | 21,280 | 371 | 147 | 21,798 | 2,192 | 188,907 |
Total | 364,346 | 40,925 | 2,301 | 1,268 | 44,494 | 4,858 | 413,698 |
Coverage ratio | % | % | % | % | % | % | % |
Home loans | - | 0.2 | 0.4 | 0.7 | 0.3 | 19.8 | 0.3 |
Credit cards, unsecured loans and other retail lending | 1.7 | 24.2 | 37.1 | 35.5 | 25.6 | 58.1 | 7.1 |
Wholesale loans | 0.3 | 1.7 | 1.1 | 0.7 | 1.7 | 19.1 | 0.7 |
Total | 0.3 | 4.4 | 5.2 | 12.1 | 4.7 | 32.6 | 1.4 |
As at 31.12.21 | |||||||
Gross exposure | £m | £m | £m | £m | £m | £m | £m |
Home loans | 148,058 | 17,133 | 1,660 | 707 | 19,500 | 2,122 | 169,680 |
Credit cards, unsecured loans and other retail lending | 37,840 | 5,102 | 300 | 248 | 5,650 | 2,332 | 45,822 |
Wholesale loans | 132,967 | 15,246 | 306 | 391 | 15,943 | 2,781 | 151,691 |
Total | 318,865 | 37,481 | 2,266 | 1,346 | 41,093 | 7,235 | 367,193 |
Impairment allowance | |||||||
Home loans | 19 | 46 | 6 | 7 | 59 | 397 | 475 |
Credit cards, unsecured loans and other retail lending | 824 | 1,493 | 85 | 123 | 1,701 | 1,504 | 4,029 |
Wholesale loans | 363 | 248 | 4 | 3 | 255 | 620 | 1,238 |
Total | 1,206 | 1,787 | 95 | 133 | 2,015 | 2,521 | 5,742 |
Net exposure | |||||||
Home loans | 148,039 | 17,087 | 1,654 | 700 | 19,441 | 1,725 | 169,205 |
Credit cards, unsecured loans and other retail lending | 37,016 | 3,609 | 215 | 125 | 3,949 | 828 | 41,793 |
Wholesale loans | 132,604 | 14,998 | 302 | 388 | 15,688 | 2,161 | 150,453 |
Total | 317,659 | 35,694 | 2,171 | 1,213 | 39,078 | 4,714 | 361,451 |
Coverage ratio | % | % | % | % | % | % | % |
Home loans | - | 0.3 | 0.4 | 1.0 | 0.3 | 18.7 | 0.3 |
Credit cards, unsecured loans and other retail lending | 2.2 | 29.3 | 28.3 | 49.6 | 30.1 | 64.5 | 8.8 |
Wholesale loans | 0.3 | 1.6 | 1.3 | 0.8 | 1.6 | 22.3 | 0.8 |
Total | 0.4 | 4.8 | 4.2 | 9.9 | 4.9 | 34.8 | 1.6 |
Measurement uncertainty
Scenarios used to calculate the Group's ECL charge were refreshed in Q322 with the current Baseline scenario reflecting the latest consensus macroeconomic forecasts available at the time of the scenario refresh. In the Baseline scenario, further inflation increases impact household income which, along with significant monetary policy tightening, contribute to lower growth prospects. GDP growth for 2023 drops to 0.3% in the UK and 1.1% in the US. Unemployment rates increase slightly in the near term, reaching 4.5% in the UK and 4.2% in the US. Central banks continue raising interest rates as currently expected with the UK Bank Rate reaching 3.50%, while the US Federal Funds Rate peaks at 3.75%. Higher interest rates are expected to adversely impact the housing markets in major economies but house price growth remains positive over the forecast horizon.
In the Downside 2 scenario, increasing and persistent inflationary pressures cause the central banks to raise interest rates sharply. The UK Bank Rate and the US Federal Funds Rate both reach 5.0% in Q423. These higher borrowing costs derail economies with unemployment peaking in 2024 at 9.5% in the UK and 9.75% in the US. With already stretched valuations, the sharp increase in borrowing costs sees house prices decrease significantly. In the Upside 2 scenario, supply disruptions are resolved, and aggregate demand is supported by a release of household savings, accelerating GDP growth. Recovering labour force participation limits domestic inflationary pressures, while lower energy prices add downward pressure on prices globally. As a result of easing inflation, central banks keep interest rates lower for longer.
The methodology for estimating scenario probability weights involves simulating a range of future paths for UK and US GDP using historical data with the five scenarios mapped against the distribution of these future paths. The median is centred around the Baseline with scenarios further from the Baseline attracting a lower weighting before the five weights are normalised to total 100%. The small weighting increase in the Baseline and modest reduction in the Downside was due to the slight shift in the relative position of the Downside scenarios to the Baseline scenario.
Management has applied economic uncertainty and other adjustments to modelled ECL outputs. The economic uncertainty adjustments of £0.7bn (30 June 2022: £1.0bn) have been determined with reference to the latest consensus macroeconomic forecasts subsequent to the modelled refresh and consist primarily of a provision for customers and clients considered most vulnerable to rising costs and supply chain disruption.
The tables below show the key consensus macroeconomic variables used in the scenarios (5-year annual paths) and the probability weights applied to each scenario.
Baseline average macroeconomic variables used in the calculation of ECL | |||||
2022 | 2023 | 2024 | 2025 | 2026 | |
As at 30.09.22 | % | % | % | % | % |
UK GDP1 | 3.6 | 0.3 | 1.6 | 1.8 | 1.9 |
UK unemployment2 | 3.9 | 4.4 | 3.9 | 3.8 | 3.8 |
UK HPI3 | 6.6 | 0.6 | 0.4 | 2.0 | 2.8 |
UK bank rate | 1.7 | 3.4 | 2.8 | 2.4 | 2.2 |
US GDP1 | 1.6 | 1.1 | 1.5 | 1.5 | 1.5 |
US unemployment4 | 3.7 | 4.0 | 4.2 | 4.2 | 4.2 |
US HPI5 | 6.4 | 3.4 | 3.4 | 3.4 | 3.4 |
US federal funds rate | 2.1 | 3.4 | 2.8 | 2.3 | 2.3 |
2022 | 2023 | 2024 | 2025 | 2026 | |
As at 30.06.22 | % | % | % | % | % |
UK GDP1 | 3.9 | 1.7 | 1.6 | 1.6 | 1.6 |
UK unemployment2 | 4.0 | 4.1 | 3.9 | 3.9 | 3.9 |
UK HPI3 | 4.3 | 1.0 | 2.2 | 2.5 | 2.8 |
UK bank rate | 1.5 | 2.7 | 2.4 | 2.1 | 2.0 |
US GDP1 | 3.3 | 2.2 | 2.1 | 2.1 | 2.1 |
US unemployment4 | 3.6 | 3.5 | 3.5 | 3.5 | 3.5 |
US HPI5 | 4.1 | 3.4 | 3.4 | 3.4 | 3.4 |
US federal funds rate | 1.5 | 3.2 | 2.9 | 2.7 | 2.5 |
2021 | 2022 | 2023 | 2024 | 2025 | |
As at 31.12.21 | % | % | % | % | % |
UK GDP1 | 6.2 | 4.9 | 2.3 | 1.9 | 1.7 |
UK unemployment2 | 4.8 | 4.7 | 4.5 | 4.3 | 4.2 |
UK HPI3 | 4.7 | 1.0 | 1.9 | 1.9 | 2.3 |
UK bank rate | 0.1 | 0.8 | 1.0 | 1.0 | 0.8 |
US GDP1 | 5.5 | 3.9 | 2.6 | 2.4 | 2.4 |
US unemployment4 | 5.5 | 4.2 | 3.6 | 3.6 | 3.6 |
US HPI5 | 11.8 | 4.5 | 5.2 | 4.9 | 5.0 |
US federal funds rate | 0.2 | 0.3 | 0.9 | 1.2 | 1.3 |
1 | Average Real GDP seasonally adjusted change in year. |
2 | Average UK unemployment rate 16-year+. |
3 | Change in year end UK HPI = Halifax All Houses, All Buyers index, relative to prior year end. |
4 | Average US civilian unemployment rate 16-year+. |
5 | Change in year end US HPI = FHFA House Price Index, relative to prior year end. |
Downside 2 average economic variables used in the calculation of ECL | |||||
2022 | 2023 | 2024 | 2025 | 2026 | |
As at 30.09.22 | % | % | % | % | % |
UK GDP1 | 3.4 | (5.0) | (2.5) | 4.0 | 4.3 |
UK unemployment2 | 4.4 | 8.1 | 9.0 | 7.0 | 6.0 |
UK HPI3 | 4.8 | (22.3) | (14.1) | 15.8 | 12.8 |
UK bank rate | 1.8 | 4.6 | 4.6 | 3.0 | 2.7 |
US GDP1 | 1.4 | (4.2) | (2.5) | 2.6 | 2.3 |
US unemployment4 | 4.1 | 7.9 | 9.5 | 8.3 | 6.7 |
US HPI5 | 5.2 | (7.2) | (0.3) | 5.3 | 4.1 |
US federal funds rate | 2.2 | 4.6 | 4.6 | 3.4 | 2.8 |
2022 | 2023 | 2024 | 2025 | 2026 | |
As at 30.06.22 | % | % | % | % | % |
UK GDP1 | 3.1 | (4.8) | (0.4) | 4.3 | 3.6 |
UK unemployment2 | 5.2 | 8.4 | 8.6 | 6.8 | 5.9 |
UK HPI3 | 0.2 | (26.2) | (3.6) | 17.9 | 10.2 |
UK bank rate | 1.8 | 4.7 | 4.3 | 2.6 | 2.3 |
US GDP1 | 2.4 | (4.1) | (0.2) | 3.4 | 2.7 |
US unemployment4 | 4.6 | 8.0 | 9.0 | 7.1 | 5.8 |
US HPI5 | (0.2) | (11.7) | (0.2) | 5.5 | 3.5 |
US federal funds rate | 1.8 | 4.8 | 4.6 | 3.6 | 3.0 |
2021 | 2022 | 2023 | 2024 | 2025 | |
As at 31.12.21 | % | % | % | % | % |
UK GDP1 | 6.2 | 0.2 | (4.0) | 2.8 | 4.3 |
UK unemployment2 | 4.8 | 7.2 | 9.0 | 7.6 | 6.3 |
UK HPI3 | 4.7 | (14.3) | (21.8) | 11.9 | 15.2 |
UK bank rate | 0.1 | 2.2 | 3.9 | 3.1 | 2.2 |
US GDP1 | 5.5 | (0.8) | (3.5) | 2.5 | 3.2 |
US unemployment4 | 5.5 | 6.4 | 9.1 | 8.1 | 6.4 |
US HPI5 | 11.8 | (6.6) | (9.0) | 5.9 | 6.7 |
US federal funds rate | 0.2 | 2.1 | 3.4 | 2.6 | 2.0 |
1 | Average Real GDP seasonally adjusted change in year. |
2 | Average UK unemployment rate 16-year+. |
3 | Change in year end UK HPI = Halifax All Houses, All Buyers index, relative to prior year end. |
4 | Average US civilian unemployment rate 16-year+. |
5 | Change in year end US HPI = FHFA House Price Index, relative to prior year end. |
Downside 1 average economic variables used in the calculation of ECL | |||||
2022 | 2023 | 2024 | 2025 | 2026 | |
As at 30.09.22 | % | % | % | % | % |
UK GDP1 | 3.5 | (2.3) | (0.4) | 2.9 | 3.1 |
UK unemployment2 | 4.1 | 6.3 | 6.5 | 5.4 | 4.9 |
UK HPI3 | 5.7 | (11.4) | (7.0) | 8.8 | 7.7 |
UK bank rate | 1.7 | 3.9 | 3.8 | 2.7 | 2.4 |
US GDP1 | 1.5 | (1.6) | (0.5) | 2.0 | 1.9 |
US unemployment4 | 3.9 | 6.0 | 6.9 | 6.3 | 5.5 |
US HPI5 | 5.8 | (2.0) | 1.5 | 4.3 | 3.8 |
US federal funds rate | 2.2 | 4.1 | 3.8 | 2.9 | 2.5 |
2022 | 2023 | 2024 | 2025 | 2026 | |
As at 30.06.22 | % | % | % | % | % |
UK GDP1 | 3.5 | (1.6) | 0.6 | 3.0 | 2.6 |
UK unemployment2 | 4.6 | 6.2 | 6.2 | 5.3 | 4.9 |
UK HPI3 | 2.3 | (13.2) | (0.8) | 10.0 | 6.5 |
UK bank rate | 1.6 | 3.8 | 3.4 | 2.4 | 2.0 |
US GDP1 | 2.7 | (1.0) | 1.1 | 2.9 | 2.5 |
US unemployment4 | 4.1 | 5.7 | 6.2 | 5.3 | 4.6 |
US HPI5 | 1.9 | (4.4) | 1.6 | 4.4 | 3.4 |
US federal funds rate | 1.7 | 3.9 | 3.8 | 3.2 | 2.8 |
2021 | 2022 | 2023 | 2024 | 2025 | |
As at 31.12.21 | % | % | % | % | % |
UK GDP1 | 6.2 | 2.8 | (0.7) | 2.3 | 2.9 |
UK unemployment2 | 4.8 | 6.2 | 6.8 | 6.0 | 5.3 |
UK HPI3 | 4.7 | (6.8) | (10.5) | 6.9 | 8.6 |
UK bank rate | 0.1 | 1.6 | 2.7 | 2.3 | 1.6 |
US GDP1 | 5.5 | 1.6 | (0.4) | 2.4 | 2.7 |
US unemployment4 | 5.5 | 5.4 | 6.6 | 6.1 | 5.2 |
US HPI5 | 11.8 | (1.2) | (2.1) | 4.8 | 5.2 |
US federal funds rate | 0.2 | 1.3 | 2.3 | 2.1 | 1.8 |
1 | Average Real GDP seasonally adjusted change in year. |
2 | Average UK unemployment rate 16-year+. |
3 | Change in year end UK HPI = Halifax All Houses, All Buyers index, relative to prior year end. |
4 | Average US civilian unemployment rate 16-year+. |
5 | Change in year end US HPI = FHFA House Price Index, relative to prior year end. |
Upside 2 average economic variables used in the calculation of ECL | |||||
2022 | 2023 | 2024 | 2025 | 2026 | |
As at 30.09.22 | % | % | % | % | % |
UK GDP1 | 4.0 | 4.0 | 3.3 | 2.8 | 2.4 |
UK unemployment2 | 3.8 | 3.5 | 3.4 | 3.4 | 3.4 |
UK HPI3 | 7.2 | 10.3 | 5.7 | 4.5 | 4.1 |
UK bank rate | 1.6 | 1.9 | 1.4 | 1.3 | 1.3 |
US GDP1 | 1.9 | 3.7 | 3.2 | 2.8 | 2.8 |
US unemployment4 | 3.6 | 3.3 | 3.3 | 3.3 | 3.3 |
US HPI5 | 7.0 | 5.7 | 4.8 | 4.5 | 4.5 |
US federal funds rate | 2.0 | 2.5 | 1.8 | 1.3 | 1.3 |
2022 | 2023 | 2024 | 2025 | 2026 | |
As at 30.06.22 | % | % | % | % | % |
UK GDP1 | 5.0 | 5.2 | 3.1 | 2.4 | 2.0 |
UK unemployment2 | 3.8 | 3.7 | 3.6 | 3.6 | 3.6 |
UK HPI3 | 6.5 | 11.2 | 6.2 | 4.7 | 3.7 |
UK bank rate | 1.2 | 1.5 | 1.4 | 1.3 | 1.3 |
US GDP1 | 4.0 | 4.9 | 3.6 | 3.4 | 3.4 |
US unemployment4 | 3.4 | 3.0 | 3.1 | 3.1 | 3.1 |
US HPI5 | 5.4 | 5.5 | 4.6 | 4.5 | 4.5 |
US federal funds rate | 1.1 | 2.2 | 1.9 | 1.7 | 1.5 |
2021 | 2022 | 2023 | 2024 | 2025 | |
As at 31.12.21 | % | % | % | % | % |
UK GDP1 | 6.2 | 7.2 | 4.0 | 2.7 | 2.1 |
UK unemployment2 | 4.8 | 4.5 | 4.1 | 4.0 | 4.0 |
UK HPI3 | 4.7 | 8.5 | 9.0 | 5.2 | 4.2 |
UK bank rate | 0.1 | 0.2 | 0.5 | 0.5 | 0.3 |
US GDP1 | 5.5 | 5.3 | 4.1 | 3.5 | 3.4 |
US unemployment4 | 5.5 | 3.9 | 3.4 | 3.3 | 3.3 |
US HPI5 | 11.8 | 10.6 | 8.5 | 7.2 | 6.6 |
US federal funds rate | 0.2 | 0.3 | 0.4 | 0.7 | 1.0 |
1 | Average Real GDP seasonally adjusted change in year. |
2 | Average UK unemployment rate 16-year+. |
3 | Change in year end UK HPI = Halifax All Houses, All Buyers index, relative to prior year end. |
4 | Average US civilian unemployment rate 16-year+. |
5 | Change in year end US HPI = FHFA House Price Index, relative to prior year end. |
Upside 1 average economic variables used in the calculation of ECL | |||||
2022 | 2023 | 2024 | 2025 | 2026 | |
As at 30.09.22 | % | % | % | % | % |
UK GDP1 | 3.8 | 2.1 | 2.5 | 2.3 | 2.1 |
UK unemployment2 | 3.8 | 3.7 | 3.6 | 3.6 | 3.6 |
UK HPI3 | 6.9 | 5.4 | 3.0 | 3.3 | 3.4 |
UK bank rate | 1.7 | 2.6 | 2.2 | 1.8 | 1.6 |
US GDP1 | 1.8 | 2.4 | 2.3 | 2.2 | 2.2 |
US unemployment4 | 3.6 | 3.7 | 3.8 | 3.8 | 3.8 |
US HPI5 | 6.7 | 4.5 | 4.1 | 3.9 | 3.9 |
US federal funds rate | 2.0 | 2.9 | 2.3 | 1.8 | 1.8 |
2022 | 2023 | 2024 | 2025 | 2026 | |
As at 30.06.22 | % | % | % | % | % |
UK GDP1 | 4.5 | 3.5 | 2.4 | 2.0 | 1.8 |
UK unemployment2 | 3.9 | 3.8 | 3.8 | 3.8 | 3.8 |
UK HPI3 | 5.4 | 6.3 | 4.1 | 3.6 | 3.2 |
UK bank rate | 1.3 | 2.0 | 1.6 | 1.5 | 1.5 |
US GDP1 | 3.7 | 3.7 | 3.0 | 2.9 | 2.9 |
US unemployment4 | 3.5 | 3.2 | 3.3 | 3.3 | 3.3 |
US HPI5 | 4.7 | 4.4 | 4.0 | 3.9 | 3.9 |
US federal funds rate | 1.3 | 2.4 | 2.2 | 1.9 | 1.8 |
2021 | 2022 | 2023 | 2024 | 2025 | |
As at 31.12.21 | % | % | % | % | % |
UK GDP1 | 6.2 | 6.0 | 3.1 | 2.3 | 1.9 |
UK unemployment2 | 4.8 | 4.6 | 4.3 | 4.2 | 4.1 |
UK HPI3 | 4.7 | 5.0 | 5.0 | 3.9 | 3.3 |
UK bank rate | 0.1 | 0.6 | 0.8 | 0.8 | 0.5 |
US GDP1 | 5.5 | 4.6 | 3.4 | 2.9 | 2.9 |
US unemployment4 | 5.5 | 4.0 | 3.5 | 3.5 | 3.5 |
US HPI5 | 11.8 | 8.3 | 7.0 | 6.0 | 5.7 |
US federal funds rate | 0.2 | 0.3 | 0.6 | 1.0 | 1.1 |
1 | Average Real GDP seasonally adjusted change in year. |
2 | Average UK unemployment rate 16-year+. |
3 | Change in year end UK HPI = Halifax All Houses, All Buyers index, relative to prior year end. |
4 | Average US civilian unemployment rate 16-year+. |
5 | Change in year end US HPI = FHFA House Price Index, relative to prior year end. |
Scenario probability weighting | |||||
Upside 2 | Upside 1 | Baseline | Downside 1 | Downside 2 | |
% | % | % | % | % | |
As at 30.09.22 | |||||
Scenario probability weighting | 13.2 | 26.1 | 39.8 | 14.2 | 6.7 |
As at 30.06.22 | |||||
Scenario probability weighting | 14.0 | 25.6 | 37.8 | 15.2 | 7.4 |
As at 31.12.21 | |||||
Scenario probability weighting | 20.9 | 27.2 | 30.1 | 14.8 | 7.0 |
ECL under 100% weighted scenarios for modelled portfolios
The table below shows the modelled ECL assuming each of the five modelled scenarios are 100% weighted with the dispersion of results around the Baseline, highlighting the impact on exposure and ECL across the scenarios. Model exposure uses exposure at default (EAD) values and is not directly comparable to gross exposure used in prior disclosures.
The economic uncertainty adjustments of £0.7bn in the below reconciliation provides headroom for a modelled move from Weighted to Downside 1 scenario.
Scenarios | ||||||
As at 30 September 2022 | Weighted1 | Upside 2 | Upside 1 | Baseline | Downside 1 | Downside 2 |
Stage 1 Model Exposure (£m) | ||||||
Home loans | 145,014 | 146,430 | 145,833 | 145,170 | 144,042 | 142,451 |
Credit cards, unsecured loans and other retail lending2 | 49,525 | 49,489 | 49,195 | 48,759 | 47,647 | 46,230 |
Wholesale loans | 190,267 | 194,085 | 192,450 | 190,757 | 187,497 | 180,876 |
Stage 1 Model ECL (£m) | ||||||
Home loans | 4 | 3 | 3 | 3 | 6 | 13 |
Credit cards, unsecured loans and other retail lending | 456 | 430 | 439 | 450 | 481 | 504 |
Wholesale loans | 295 | 244 | 265 | 284 | 347 | 403 |
Stage 1 Coverage (%) | ||||||
Home loans | - | - | - | - | - | - |
Credit cards, unsecured loans and other retail lending | 0.9 | 0.9 | 0.9 | 0.9 | 1.0 | 1.1 |
Wholesale loans | 0.2 | 0.1 | 0.1 | 0.1 | 0.2 | 0.2 |
Stage 2 Model Exposure (£m) | ||||||
Home loans | 17,615 | 16,199 | 16,796 | 17,459 | 18,587 | 20,178 |
Credit cards, unsecured loans and other retail lending2 | 7,719 | 6,759 | 7,081 | 7,595 | 8,962 | 10,776 |
Wholesale loans | 27,647 | 23,829 | 25,464 | 27,157 | 30,417 | 37,038 |
Stage 2 Model ECL (£m) | ||||||
Home loans | 21 | 13 | 15 | 18 | 32 | 55 |
Credit cards, unsecured loans and other retail lending | 1,596 | 1,353 | 1,436 | 1,563 | 1,937 | 2,449 |
Wholesale loans | 559 | 412 | 457 | 529 | 779 | 1,303 |
Stage 2 Coverage (%) | ||||||
Home loans | 0.1 | 0.1 | 0.1 | 0.1 | 0.2 | 0.3 |
Credit cards, unsecured loans and other retail lending | 20.7 | 20.0 | 20.3 | 20.6 | 21.6 | 22.7 |
Wholesale loans | 2.0 | 1.7 | 1.8 | 1.9 | 2.6 | 3.5 |
Stage 3 Model Exposure (£m)3 | ||||||
Home loans | 1,586 | 1,586 | 1,586 | 1,586 | 1,586 | 1,586 |
Credit cards, unsecured loans and other retail lending | 1,790 | 1,790 | 1,790 | 1,790 | 1,790 | 1,790 |
Wholesale loans | 2,671 | 2,671 | 2,671 | 2,671 | 2,671 | 2,671 |
Stage 3 Model ECL (£m) | ||||||
Home loans | 322 | 311 | 314 | 318 | 338 | 364 |
Credit cards, unsecured loans and other retail lending | 1,207 | 1,191 | 1,199 | 1,205 | 1,225 | 1,240 |
Wholesale loans4 | 45 | 41 | 42 | 44 | 49 | 54 |
Stage 3 Coverage (%) | ||||||
Home loans | 20.3 | 19.6 | 19.8 | 20.1 | 21.3 | 23.0 |
Credit cards, unsecured loans and other retail lending | 67.4 | 66.5 | 67.0 | 67.3 | 68.4 | 69.3 |
Wholesale loans4 | 1.7 | 1.5 | 1.6 | 1.6 | 1.8 | 2.0 |
Total Model ECL (£m) | ||||||
Home loans | 347 | 327 | 332 | 339 | 376 | 432 |
Credit cards, unsecured loans and other retail lending | 3,259 | 2,974 | 3,074 | 3,218 | 3,643 | 4,193 |
Wholesale loans4 | 899 | 697 | 764 | 857 | 1,175 | 1,760 |
Total Model ECL | 4,505 | 3,998 | 4,170 | 4,414 | 5,194 | 6,385 |
Reconciliation to total ECL | £m |
Total weighted model ECL | 4,505 |
ECL from individually assessed impairments4 | 426 |
ECL from non-modelled exposures and others | 363 |
ECL from post model management adjustments | 1,096 |
Of which: ECL from economic uncertainty adjustments | 735 |
Total ECL | 6,390 |
1 | Model exposures are allocated to a stage based on an individual scenario rather than a probability-weighted approach as required for Barclays reported impairment allowances. As a result, it is not possible to back solve the final reported weighted ECL from individual scenarios given balances may be assigned to a different stage dependent on the scenario. |
2 | For Credit cards, unsecured loans and other retail lending, an average EAD measure is used (12-month or lifetime), depending on stage allocation for each scenario. Therefore, the model exposure movement into Stage 2 is higher than the corresponding Stage 1 reduction. |
3 | Model exposures allocated to Stage 3 does not change in any of the scenarios as the transition criteria relies only on an observable evidence of default as at 30 September 2022 and not on macroeconomic scenario. |
4 | Material wholesale loan defaults are individually assessed across different recovery strategies. As a result, ECL of £426m is reported as an individually assessed impairment in the reconciliation table. |
The use of five scenarios with associated weightings results in a total weighted ECL uplift from the Baseline ECL of 2.1%.
Home loans: Total weighted ECL of £347m represents a 2.4% increase over the Baseline ECL (£339m) with coverage ratios steady across the Upside scenarios, Baseline and Downside 1 scenario. Under the Downside 2 scenario, total ECL increases to £432m driven by a significant fall in UK HPI to 22.3% reflecting the non-linearity of the UK portfolio.
Credit cards, unsecured loans and other retail lending: Total weighted ECL of £3,259m represents a 1.3% increase over the Baseline ECL (£3,218m). Total ECL increases to £4,193m under the Downside 2 scenario, driven by the significant increase in UK unemployment rate to 8.1% and US unemployment rate to 7.9% in 2023.
Wholesale loans: Total weighted ECL of £899m represents an 4.9% increase over the Baseline ECL (£857m). Total ECL increases to £1,760m under Downside 2 scenario, driven by a significant decrease in UK GDP to (5.0)% and US GDP to (4.2)% in 2023.
Scenarios | ||||||
As at 31 December 2021 | Weighted1 | Upside 2 | Upside 1 | Baseline | Downside 1 | Downside 2 |
Stage 1 Model Exposure (£m) | ||||||
Home loans | 137,279 | 139,117 | 138,424 | 137,563 | 135,544 | 133,042 |
Credit cards, unsecured loans and other retail lending2 | 45,503 | 46,170 | 45,963 | 45,751 | 43,131 | 38,820 |
Wholesale loans | 174,249 | 177,453 | 176,774 | 175,451 | 169,814 | 161,998 |
Stage 1 Model ECL (£m) | ||||||
Home loans | 4 | 2 | 2 | 3 | 6 | 14 |
Credit cards, unsecured loans and other retail lending | 324 | 266 | 272 | 279 | 350 | 418 |
Wholesale loans | 290 | 240 | 262 | 286 | 327 | 350 |
Stage 1 Coverage (%) | ||||||
Home loans | - | - | - | - | - | - |
Credit cards, unsecured loans and other retail lending | 0.7 | 0.6 | 0.6 | 0.6 | 0.8 | 1.1 |
Wholesale loans | 0.2 | 0.1 | 0.1 | 0.2 | 0.2 | 0.2 |
Stage 2 Model Exposure (£m) | ||||||
Home loans | 22,915 | 21,076 | 21,769 | 22,631 | 24,649 | 27,151 |
Credit cards, unsecured loans and other retail lending2 | 7,200 | 6,260 | 6,521 | 6,795 | 9,708 | 14,290 |
Wholesale loans | 32,256 | 29,052 | 29,732 | 31,054 | 36,692 | 44,507 |
Stage 2 Model ECL (£m) | ||||||
Home loans | 15 | 10 | 11 | 12 | 22 | 47 |
Credit cards, unsecured loans and other retail lending | 1,114 | 925 | 988 | 1,058 | 1,497 | 3,295 |
Wholesale loans | 572 | 431 | 467 | 528 | 851 | 1,510 |
Stage 2 Coverage (%) | ||||||
Home loans | 0.1 | - | 0.1 | 0.1 | 0.1 | 0.2 |
Credit cards, unsecured loans and other retail lending | 15.5 | 14.8 | 15.2 | 15.6 | 15.4 | 23.1 |
Wholesale loans | 1.8 | 1.5 | 1.6 | 1.7 | 2.3 | 3.4 |
Stage 3 Model Exposure (£m)3 | ||||||
Home loans | 1,724 | 1,724 | 1,724 | 1,724 | 1,724 | 1,724 |
Credit cards, unsecured loans and other retail lending | 1,922 | 1,922 | 1,922 | 1,922 | 1,922 | 1,922 |
Wholesale loans | 1,811 | 1,811 | 1,811 | 1,811 | 1,811 | 1,811 |
Stage 3 Model ECL (£m) | ||||||
Home loans | 303 | 292 | 295 | 299 | 320 | 346 |
Credit cards, unsecured loans and other retail lending | 1,255 | 1,236 | 1,245 | 1,255 | 1,277 | 1,297 |
Wholesale loans4 | 323 | 321 | 322 | 323 | 326 | 332 |
Stage 3 Coverage (%) | ||||||
Home loans | 17.6 | 16.9 | 17.1 | 17.3 | 18.6 | 20.1 |
Credit cards, unsecured loans and other retail lending | 65.3 | 64.3 | 64.8 | 65.3 | 66.4 | 67.5 |
Wholesale loans4 | 17.8 | 17.7 | 17.8 | 17.8 | 18.0 | 18.3 |
Total Model ECL (£m) | ||||||
Home loans | 322 | 304 | 308 | 314 | 348 | 407 |
Credit cards, unsecured loans and other retail lending | 2,693 | 2,427 | 2,505 | 2,592 | 3,124 | 5,010 |
Wholesale loans4 | 1,185 | 992 | 1,051 | 1,137 | 1,504 | 2,192 |
Total Model ECL | 4,200 | 3,723 | 3,864 | 4,043 | 4,976 | 7,609 |
Reconciliation to total ECL | £m |
Total model ECL | 4,200 |
ECL from individually assessed impairments4 | 524 |
ECL from non-modelled exposures and others | 74 |
ECL from post model management adjustments5 | 1,486 |
Of which: ECL from economic uncertainty adjustments | 1,692 |
Total ECL | 6,284 |
1 | Model exposures are allocated to a stage based on an individual scenario rather than a probability-weighted approach, as required for Barclays reported impairment allowances. As a result, it is not possible to back solve the final reported weighted ECL from individual scenarios given balances may be assigned to a different stage dependent on the scenario. |
2 | For Credit cards, unsecured loans and other retail lending, an average EAD measure is used (12-month or lifetime), depending on stage allocation for each scenario. Therefore, the model exposure movement into Stage 2 is higher than the corresponding Stage 1 reduction. |
3 | Model exposures allocated to Stage 3 does not change in any of the scenarios as the transition criteria relies only on an observable evidence of default as at 30 September 2022 and not on macroeconomic scenario. |
4 | Material wholesale loan defaults are individually assessed across different recovery strategies. As a result, ECL of £524m is reported as an individually assessed impairment in the reconciliation table. |
5 | Post Model Adjustments include negative adjustments reflecting operational post model adjustments. |
Treasury and Capital Risk
Regulatory minimum requirements
Capital
The Group's Overall Capital Requirement for CET1 is 10.9% comprising a 4.5% Pillar 1 minimum, a 2.5% Capital Conservation Buffer (CCB), a 1.5% Global Systemically Important Institution (G-SII) buffer, a 2.4% Pillar 2A requirement and a 0% Countercyclical Capital Buffer (CCyB).
The Group's CCyB is based on the buffer rate applicable for each jurisdiction in which the Group has exposures. On 11 March 2020, the Financial Policy Committee (FPC) set the CCyB rate for UK exposures at 0% with immediate effect. The buffer rates set by other national authorities for non-UK exposures are not currently material. Overall, this results in a 0.0% CCyB for the Group. On 13 December 2021, the FPC announced that a CCyB rate of 1% for UK exposures has been re-introduced with effect from 13 December 2022. On 5 July 2022, the FPC announced that the UK CCyB rate will be increased from 1% to 2% with effect from 5 July 2023.
The Group's Pillar 2A requirement as per the PRA's Individual Capital Requirement was set as a nominal amount. When expressed as a percentage of RWAs this was 4.2% of which at least 56.25% needed to be met with CET1 capital, equating to approximately 2.4% of RWAs. The Pillar 2A requirement is subject to at least annual review and is based on a point in time assessment.
The Group's CET1 target ratio of 13-14% takes into account headroom above requirements which includes a confidential institution-specific PRA buffer. The Group remains above its minimum capital regulatory requirements including the PRA buffer.
Leverage
The Group is subject to a UK leverage ratio requirement of 3.8%. This comprises the 3.25% minimum requirement, a G-SII additional leverage ratio buffer (G-SII ALRB) of 0.53% and a countercyclical leverage ratio buffer of 0.0%. Although the leverage ratio is expressed in terms of Tier 1 (T1) capital, 75% of the minimum requirement, equating to 2.4375%, needs to be met with CET1 capital. In addition, the G-SII ALRB must be covered solely with CET1 capital. The CET1 capital held against the 0.53% G-SII ALRB was £6.5bn.
The Group is also required to disclose an average UK leverage ratio which is based on capital on the last day of each month in the quarter and an exposure measure for each day in the quarter.
MREL
The Group is required to meet the higher of: (i) two times the sum of 8% Pillar 1 and 4.2% Pillar 2A; and (ii) 6.75% of leverage exposures plus capital buffers, including the above mentioned confidential institution-specific PRA buffer. CET1 capital cannot be counted towards both MREL and the capital buffers, meaning that the buffers will effectively be applied above MREL requirements.
Significant regulatory updates in the period
Capital and RWAs
On 1 January 2022, the PRA's implementation of Basel III standards took effect including the re-introduction of the 100% CET1 capital deduction for qualifying software intangible assets and the introduction of the Standardised Approach for Counterparty Credit Risk (SA-CCR) which replaces the Current Exposure Method for Standardised derivative exposures as a more risk sensitive approach. In addition, the PRA also implemented IRB roadmap changes which includes revisions to the criteria for definition of default, probability of default and loss given default estimation to ensure supervisory consistency and increase transparency of IRB models.
Leverage
From 1 January 2022, UK banks became subject to a single UK leverage ratio requirement meaning that the CRR leverage ratio no longer applies. Central bank claims can be excluded from the UK leverage ratio measure as long as they are matched by qualifying liabilities (rather than deposits).
References to CRR, as amended by CRR II mean, the capital regulatory requirements, as they form part of domestic law by virtue of the European Union (Withdrawal) Act 2018, as amended.
Restated1 | |||
Capital ratios2,3,4 | As at 30.09.22 | As at 30.06.22 | As at 31.12.21 |
CET1 | 13.8% | 13.6% | 15.1% |
T1 | 17.6% | 17.1% | 19.1% |
Total regulatory capital | 20.3% | 19.9% | 22.2% |
Capital resources | £m | £m | £m |
Total equity excluding non-controlling interests per the balance sheet | 67,034 | 69,627 | 69,052 |
Less: other equity instruments (recognised as AT1 capital) | (13,270) | (12,357) | (12,259) |
Adjustment to retained earnings for foreseeable ordinary share dividends | (494) | (595) | (666) |
Adjustment to retained earnings for foreseeable repurchase of shares | (9) | (568) | - |
Adjustment to retained earnings for foreseeable other equity coupons | (82) | (32) | (32) |
Other regulatory adjustments and deductions | |||
Additional value adjustments (PVA) | (1,850) | (1,810) | (1,585) |
Goodwill and intangible assets | (8,356) | (8,232) | (6,804) |
Deferred tax assets that rely on future profitability excluding temporary differences | (1,034) | (1,010) | (1,028) |
Fair value reserves related to gains or losses on cash flow hedges | 9,451 | 4,673 | 852 |
Excess of expected losses over impairment | (7) | - | - |
Gains or losses on liabilities at fair value resulting from own credit | (773) | (62) | 892 |
Defined benefit pension fund assets | (3,162) | (3,785) | (2,619) |
Direct and indirect holdings by an institution of own CET1 instruments | (20) | (20) | (50) |
Adjustment under IFRS 9 transitional arrangements | 759 | 642 | 1,229 |
Other regulatory adjustments | 387 | 220 | 345 |
CET1 capital | 48,574 | 46,691 | 47,327 |
AT1 capital | |||
Capital instruments and related share premium accounts | 13,270 | 12,357 | 12,259 |
Qualifying AT1 capital (including minority interests) issued by subsidiaries | - | - | 637 |
Other regulatory adjustments and deductions | (60) | (60) | (80) |
AT1 capital | 13,210 | 12,297 | 12,816 |
T1 capital | 61,784 | 58,988 | 60,143 |
T2 capital | |||
Capital instruments and related share premium accounts | 8,524 | 8,442 | 8,713 |
Qualifying T2 capital (including minority interests) issued by subsidiaries | 1,176 | 1,277 | 1,113 |
Credit risk adjustments (excess of impairment over expected losses) | - | 73 | 73 |
Other regulatory adjustments and deductions | (160) | (160) | (160) |
Total regulatory capital | 71,324 | 68,620 | 69,882 |
Total RWAs | 350,774 | 344,516 | 314,136 |
1 | Capital metrics as at 31 December 2021 have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. The transitional CET1 ratio remains unchanged at 15.1%. |
2 | CET1, T1 and T2 capital, and RWAs are calculated applying the transitional arrangements of the CRR as amended by CRR II. This includes IFRS 9 transitional arrangements and the grandfathering of CRR II non-compliant capital instruments. December 2021 comparatives include the grandfathering of CRR non-compliant capital instruments. |
3 | The fully loaded CET1 ratio, as is relevant for assessing against the conversion trigger in Barclays PLC AT1 securities, was 13.6%, with £47.8bn of CET1 capital and £350.5bn of RWAs calculated without applying the transitional arrangements of the CRR as amended by CRR II. |
4 | The Group's CET1 ratio, as is relevant for assessing against the conversion trigger in Barclays Bank PLC 7.625% Contingent Capital Notes, was 13.8%. For this calculation CET1 capital and RWAs are calculated applying the transitional arrangements under the CRR as amended by CRR II, including the IFRS 9 transitional arrangements. The benefit of the Financial Services Authority (FSA) October 2012 interpretation of the transitional provisions, relating to the implementation of CRD IV, expired in December 2017. |
Movement in CET1 capital | Three months ended 30.09.22 | Nine months ended 30.09.22 |
£m | £m | |
Opening CET1 capital1 | 46,691 | 47,327 |
Profit for the period attributable to equity holders | 1,718 | 4,607 |
Own credit relating to derivative liabilities | (78) | (175) |
Ordinary share dividends paid and foreseen | (263) | (856) |
Purchased and foreseeable share repurchase | (500) | (1,500) |
Other equity coupons paid and foreseen | (256) | (670) |
Increase in retained regulatory capital generated from earnings | 621 | 1,406 |
Net impact of share schemes | 145 | 9 |
Fair value through other comprehensive income reserve | (408) | (1,167) |
Currency translation reserve | 1,730 | 3,433 |
Other reserves | 23 | 58 |
Increase in other qualifying reserves | 1,490 | 2,333 |
Pension remeasurements within reserves | (765) | 325 |
Defined benefit pension fund asset deduction | 623 | (543) |
Net impact of pensions | (142) | (218) |
Additional value adjustments (PVA) | (40) | (265) |
Goodwill and intangible assets | (124) | (1,552) |
Deferred tax assets that rely on future profitability excluding those arising from temporary differences | (24) | (6) |
Excess of expected loss over impairment | (7) | (7) |
Direct and indirect holdings by an institution of own CET1 instruments | - | 30 |
Adjustment under IFRS 9 transitional arrangements | 117 | (470) |
Other regulatory adjustments | (8) | (4) |
Decrease in regulatory capital due to adjustments and deductions | (86) | (2,274) |
Closing CET1 capital | 48,574 | 48,574 |
1 | Opening balance as at 31 December 2021 has been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for further details. |
CET1 capital increased £1.2bn to £48.6bn (December 2021: £47.3bn).
CET1 capital decreased by £1.7bn as a result of regulatory changes that took effect from 1 January 2022 including the re-introduction of the 100% CET1 capital deduction for qualifying software intangible assets and a reduction in IFRS9 transitional relief due to the relief applied to the pre-2020 impairment charge reducing to 25% in 2022 from 50% in 2021 and the relief applied to the post-2020 impairment charge reducing to 75% in 2022 from 100% in 2021.
£4.6bn of capital generated from profits, after absorbing the £0.6bn net of tax impact of the Over-issuance of Securities, was partially offset by distributions of £3bn comprising:
· | £1bn buyback announced with FY21 results and the £0.5bn buyback announced with H122 results, both of which have completed |
· | £0.9bn of ordinary share dividend paid and foreseen reflecting £0.4bn half year 2022 dividend paid and a £0.5bn accrual towards a full year 2022 dividend |
· | £0.7bn of equity coupons paid and foreseen |
Other significant movements in the period were:
· | £1.2bn decrease in the fair value through other comprehensive income reserve primarily due to losses on bonds as a result of an increase in yields |
· | £3.4bn increase in the currency translation reserves driven by the appreciation of period end USD against GBP |
RWAs by risk type and business | |||||||||||||
Credit risk | Counterparty credit risk | Market Risk | Operational risk | Total RWAs | |||||||||
STD | IRB | STD | IRB | Settlement Risk | CVA | STD | IMA | ||||||
As at 30.09.22 | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m | |||
Barclays UK | 6,487 | 55,121 | 246 | - | - | 84 | 256 | - | 11,047 | 73,241 | |||
Corporate and Investment Bank | 38,886 | 75,561 | 20,115 | 24,735 | 446 | 3,111 | 15,596 | 26,879 | 25,296 | 230,625 | |||
Consumer, Cards and Payments | 28,180 | 3,597 | 279 | 35 | - | 69 | - | 104 | 6,424 | 38,688 | |||
Barclays International | 67,066 | 79,158 | 20,394 | 24,770 | 446 | 3,180 | 15,596 | 26,983 | 31,720 | 269,313 | |||
Head Office | 2,785 | 6,431 | - | - | - | - | - | - | (996) | 8,220 | |||
Barclays Group | 76,338 | 140,710 | 20,640 | 24,770 | 446 | 3,264 | 15,852 | 26,983 | 41,771 | 350,774 | |||
As at 30.06.22 | |||||||||||||
Barclays UK | 6,613 | 53,958 | 253 | - | - | 76 | 236 | - | 11,047 | 72,183 | |||
Corporate and Investment Bank | 40,055 | 71,737 | 18,739 | 22,099 | 440 | 3,357 | 17,466 | 28,423 | 25,296 | 227,612 | |||
Consumer, Cards and Payments | 25,516 | 3,643 | 256 | 34 | - | 64 | 28 | 195 | 6,424 | 36,160 | |||
Barclays International | 65,571 | 75,380 | 18,995 | 22,133 | 440 | 3,421 | 17,494 | 28,618 | 31,720 | 263,772 | |||
Head Office | 3,488 | 6,069 | - | - | - | - | - | - | (996) | 8,561 | |||
Barclays Group | 75,672 | 135,407 | 19,248 | 22,133 | 440 | 3,497 | 17,730 | 28,618 | 41,771 | 344,516 | |||
As at 31.12.21 | |||||||||||||
Barclays UK | 7,195 | 53,408 | 426 | - | - | 138 | 100 | - | 11,022 | 72,289 | |||
Corporate and Investment Bank | 29,420 | 64,416 | 15,223 | 19,238 | 105 | 2,289 | 17,306 | 27,308 | 25,359 | 200,664 | |||
Consumer, Cards and Payments | 20,770 | 2,749 | 215 | 18 | - | 21 | - | 57 | 6,391 | 30,221 | |||
Barclays International | 50,190 | 67,165 | 15,438 | 19,256 | 105 | 2,310 | 17,306 | 27,365 | 31,750 | 230,885 | |||
Head Office | 4,733 | 7,254 | - | - | - | - | - | - | (1,025) | 10,962 | |||
Barclays Group | 62,118 | 127,827 | 15,864 | 19,256 | 105 | 2,448 | 17,406 | 27,365 | 41,747 | 314,136 | |||
Movement analysis of RWAs | Credit risk | Counterparty credit risk | Market risk | Operational risk | Total RWAs |
£m | £m | £m | £m | £m | |
Opening RWAs (as at 31.12.21) | 189,945 | 37,673 | 44,771 | 41,747 | 314,136 |
Book size | 10,661 | 2,504 | (4,509) | 24 | 8,680 |
Acquisitions and disposals | (1,081) | - | - | - | (1,081) |
Book quality | (2,774) | 944 | - | - | (1,830) |
Model updates | - | - | - | - | - |
Methodology and policy | 4,523 | 3,353 | - | - | 7,876 |
Foreign exchange movements1 | 15,774 | 4,646 | 2,573 | - | 22,993 |
Total RWA movements | 27,103 | 11,447 | (1,936) | 24 | 36,638 |
Closing RWAs (as at 30.09.22) | 217,048 | 49,120 | 42,835 | 41,771 | 350,774 |
1 | Foreign exchange movements does not include foreign exchange for modelled market risk or operational risk. |
Overall RWAs increased £36.6bn to £350.8bn (December 2021: £314.1bn)
Credit risk RWAs increased £27.1bn:
· | A £10.7bn increase in book size primarily driven by an increase in lending activities across CIB, CC&P and growth in mortgages within Barclays UK |
· | A £1.1bn decrease in acquisitions and disposals primarily driven by the disposal of Barclays' equity stake in Absa, offset by GAP portfolio acquisition |
· | A £2.7bn decrease in book quality primarily driven by the benefit in mortgages from an increase in the House Price Index (HPI) |
· | A £4.5bn increase in methodology and policy primarily as a result of regulatory changes relating to implementation of IRB roadmap changes, partially offset by the reversal of the software intangibles benefit |
· | A £15.8bn increase in FX primarily due to appreciation of period end USD against GBP |
Counterparty Credit risk RWAs increased £11.4bn:
· | A £2.5bn increase in book size primarily due to an increase in trading activities within SFTs and derivatives |
· | A £3.4bn increase in methodology and policy as a result of regulatory changes relating to the introduction of SA-CCR |
· | A £4.6bn increase in FX primarily due to appreciation of period end USD against GBP |
Market risk RWAs decreased £1.9bn:
· | A £4.5bn decrease in book size primarily driven by a £4.7bn decrease in Stressed Value at Risk (SVaR) model adjustment as a result of changes in portfolio composition and a £1.4bn reduction in Structural FX, partially offset by a £1.6bn increase due to client and trading activities |
· | A £2.6bn increase in FX primarily due to appreciation of period end USD against GBP |
Restated1 | |||
Leverage ratios2,3 | As at 30.09.22 | As at 30.06.22 | As at 31.12.21 |
£m | £m | £m | |
Average UK leverage ratio | 4.8% | 4.7% | 4.9% |
Average T1 capital | 60,651 | 57,689 | 59,739 |
Average UK leverage exposure | 1,259,648 | 1,233,537 | 1,229,041 |
UK leverage ratio | 5.0% | 5.1% | 5.2% |
CET1 capital | 48,574 | 46,691 | 47,327 |
AT1 capital | 13,210 | 12,297 | 12,179 |
T1 capital | 61,784 | 58,988 | 59,506 |
UK leverage exposure | 1,232,105 | 1,151,214 | 1,137,904 |
UK leverage exposure | |||
Accounting assets | |||
Derivative financial instruments | 416,908 | 344,855 | 262,572 |
Derivative cash collateral | 90,948 | 66,909 | 58,177 |
Securities financing transactions (SFTs) | 224,978 | 193,682 | 170,853 |
Loans and advances and other assets | 994,065 | 983,784 | 892,683 |
Total IFRS assets | 1,726,899 | 1,589,230 | 1,384,285 |
Regulatory consolidation adjustments | (6,598) | (3,546) | (3,665) |
Derivatives adjustments | |||
Derivatives netting | (347,999) | (288,727) | (236,881) |
Adjustments to collateral | (76,083) | (53,328) | (50,929) |
Net written credit protection | 26,838 | 28,102 | 15,509 |
Potential future exposure (PFE) on derivatives | 84,597 | 85,469 | 137,291 |
Total derivatives adjustments | (312,647) | (228,484) | (135,010) |
SFTs adjustments | 30,477 | 29,784 | 24,544 |
Regulatory deductions and other adjustments | (21,582) | (22,758) | (20,219) |
Weighted off-balance sheet commitments | 135,222 | 127,400 | 115,047 |
Qualifying central bank claims | (267,792) | (294,477) | (210,134) |
Settlement netting | (51,874) | (45,935) | (16,944) |
UK leverage exposure | 1,232,105 | 1,151,214 | 1,137,904 |
1 | Capital and leverage metrics as at 31 December 2021 have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for further details. |
2 | Capital and leverage measures are calculated applying the transitional arrangements of the CRR as amended by CRR II. |
3 | Fully loaded average UK leverage ratio was 4.8%, with £59.9bn of T1 capital and £1,258.9bn of leverage exposure. Fully loaded UK leverage ratio was 5.0%, with £61.0bn of T1 capital and £1,231.3bn of leverage exposure. Fully loaded UK leverage ratios are calculated without applying the transitional arrangements of the CRR as amended by CRR II. |
The UK leverage ratio decreased to 5.0% (December 2021: 5.2%) primarily due to a £94.2bn increase in the leverage exposure, partially offset by a £2.3bn increase in Tier 1 Capital. The UK leverage exposure increased to £1,232.1bn (December 2021: £1,137.9bn) largely due to the following movements:
· | £60.1bn increase in SFTs primarily driven by client activity in CIB |
· | £50.8bn increase in derivative financial instruments post additional regulatory netting and adjustments for cash collateral primarily driven by client and trading activity in CIB and the application of a 1.4 multiplier introduced under SA-CCR |
· | £42.7bn increase in loans and advances and other assets (excluding cash at central banks and settlement balances which are subject to regulatory exemptions) primarily due to increased lending |
· | £11.3bn increase in net written credit protection largely due to the inclusion of credit default swap options from 1 January 2022 |
· | £52.7bn decrease in PFE on derivatives largely driven by increased netting eligibility due to the introduction of SA-CCR |
· | £39.2bn decrease in cash at central banks net of the qualifying central bank claims exemption primarily due to the matching of allowable liabilities rather than deposits introduced under the UK leverage framework review and an increase in eligible Euro denominated assets and liabilities. |
The average UK leverage ratio decreased to 4.8% (December 2021: 4.9%) primarily due to a £30.6bn increase in average leverage exposure partially offset by a £0.9bn increase in average T1 capital. The increase in average UK leverage exposure was due to the movements broadly in line with UK Leverage exposure that were in turn driven by increased client activity during the year and the regulatory changes that came into effect from 1 January 2022 under UK leverage ratio framework.
MREL | |||||||
MREL requirements including buffers1,2,3,4 | Total requirement (£m) based on | Requirement as a percentage of: | |||||
Restated1 | Restated1 | ||||||
As at 30.09.22 | As at 30.06.22 | As at 31.12.21 | As at 30.09.22 | As at 30.06.22 | As at 31.12.21 | ||
Requirement based on RWAs (minimum requirement) | 99,596 | 98,096 | 77,302 | 28.4% | 28.5% | 24.6% | |
Requirement based on UK leverage exposure4 | 97,243 | 91,532 | 93,975 | 7.9% | 8.0% | 6.9% | |
Restated1 | |||||||
Own funds and eligible liabilities1,3 | As at 30.09.22 | As at 30.06.22 | As at 31.12.21 | ||||
£m | £m | £m | |||||
CET1 capital | 48,574 | 46,691 | 47,327 | ||||
AT1 capital instruments and related share premium accounts5 | 13,210 | 12,297 | 12,179 | ||||
T2 capital instruments and related share premium accounts5 | 8,364 | 8,355 | 8,626 | ||||
Eligible liabilities | 41,744 | 39,137 | 39,889 | ||||
Total Barclays PLC (the Parent company) own funds and eligible liabilities | 111,892 | 106,480 | 108,021 | ||||
Total RWAs | 350,774 | 344,516 | 314,136 | ||||
Total UK leverage exposure4 | 1,232,105 | 1,151,214 | 1,356,191 | ||||
Restated1 | |||||||
Own funds and eligible liabilities ratios as a percentage of:1 | As at 30.09.22 | As at 30.06.22 | As at 31.12.21 | ||||
Total RWAs | 31.9% | 30.9% | 34.4% | ||||
Total UK leverage exposure4 | 9.1% | 9.2% | 8.0% | ||||
As at 30 September 2022, Barclays PLC (the Parent company) held £111.9bn of own funds and eligible liabilities equating to 31.9% of RWAs. This was in excess of the Group's MREL requirement, excluding the PRA buffer, to hold £99.6bn of own funds and eligible liabilities equating to 28.4% of RWAs. The Group remains above its MREL regulatory requirement including the PRA buffer.
1 | Capital and leverage metrics as at 31 December 2021 have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for further details. |
2 | Minimum requirement excludes the confidential institution-specific PRA buffer. |
3 | CET1, T1 and T2 capital, and RWAs are calculated applying the transitional arrangements of the CRR as amended by CRR II including IFRS 9 transitional arrangements. |
4 | As at 31 December 2021, MREL requirements were on a CRR leverage basis which, from 1 January 2022, was no longer applicable for UK banks. |
5 | Includes other AT1 capital regulatory adjustments and deductions of £60m (December 2021: £80m), and other T2 credit risk adjustments and deductions of £160m (December 2021: £87m). |
Condensed Consolidated Financial Statements
Condensed consolidated income statement (unaudited) | ||
Restated1 | ||
Nine months ended 30.09.22 | Nine months ended 30.09.21 | |
£m | £m | |
Total income | 19,155 | 16,780 |
Credit impairment (charges)/releases | (722) | 622 |
Net operating income | 18,433 | 17,402 |
Operating expenses excluding litigation and conduct | (11,209) | (10,578) |
Litigation and conduct | (1,518) | (305) |
Operating expenses | (12,727) | (10,883) |
Other net (expenses)/income | (4) | 247 |
Profit before tax | 5,702 | 6,766 |
Tax charge | (1,072) | (1,034) |
Profit after tax | 4,630 | 5,732 |
Attributable to: | ||
Equity holders of the parent | 3,987 | 5,126 |
Other equity instrument holders | 620 | 586 |
Total equity holders of the parent | 4,607 | 5,712 |
Non-controlling interests | 23 | 20 |
Profit after tax | 4,630 | 5,732 |
Earnings per share | p | p |
Basic earnings per ordinary share | 24.2 | 30.0 |
1 | 2021 financial metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 60 for more information. |
Condensed consolidated balance sheet (unaudited) | ||
Restated1 | ||
As at 30.09.22 | As at 31.12.21 | |
Assets | £m | £m |
Cash and balances at central banks | 257,070 | 238,574 |
Cash collateral and settlement balances | 167,831 | 92,542 |
Loans and advances at amortised cost | 413,697 | 361,451 |
Reverse repurchase agreements and other similar secured lending | 1,286 | 3,227 |
Trading portfolio assets | 126,374 | 147,035 |
Financial assets at fair value through the income statement | 247,770 | 191,972 |
Derivative financial instruments | 416,908 | 262,572 |
Financial assets at fair value through other comprehensive income | 65,655 | 61,753 |
Investments in associates and joint ventures | 916 | 999 |
Goodwill and intangible assets | 8,371 | 8,061 |
Current tax assets | 449 | 261 |
Deferred tax assets | 7,272 | 4,619 |
Other assets | 13,300 | 11,219 |
Total assets | 1,726,899 | 1,384,285 |
Liabilities | ||
Deposits at amortised cost | 574,386 | 519,433 |
Cash collateral and settlement balances | 145,086 | 79,371 |
Repurchase agreements and other similar secured borrowing | 27,644 | 28,352 |
Debt securities in issue | 119,722 | 98,867 |
Subordinated Liabilities | 12,321 | 12,759 |
Trading portfolio liabilities | 87,323 | 54,169 |
Financial liabilities designated at fair value | 280,744 | 250,960 |
Derivative financial instruments | 394,795 | 256,883 |
Current tax liabilities | 533 | 689 |
Deferred tax liabilities | 6 | 37 |
Other liabilities | 16,336 | 12,724 |
Total liabilities | 1,658,896 | 1,314,244 |
Equity | ||
Called up share capital and share premium | 4,358 | 4,536 |
Other reserves | (2,923) | 1,770 |
Retained earnings | 52,329 | 50,487 |
Shareholders' equity attributable to ordinary shareholders of the parent | 53,764 | 56,793 |
Other equity instruments | 13,270 | 12,259 |
Total equity excluding non-controlling interests | 67,034 | 69,052 |
Non-controlling interests | 969 | 989 |
Total equity | 68,003 | 70,041 |
Total liabilities and equity | 1,726,899 | 1,384,285 |
1 | 2021 financial metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Condensed consolidated statement of changes in equity (unaudited) | |||||||
Called up share capital and share premium | Other equity instruments | Other reserves | Restated1 Retained earnings | Restated1 Total | Non-controlling interests | Restated1 Total equity | |
Nine months ended 30.09.22 | £m | £m | £m | £m | £m | £m | £m |
Balance as at 1 January 2022 | 4,536 | 12,259 | 1,770 | 50,487 | 69,052 | 989 | 70,041 |
Profit after tax | - | 620 | - | 3,987 | 4,607 | 23 | 4,630 |
Currency translation movements | - | - | 3,433 | - | 3,433 | - | 3,433 |
Fair value through other comprehensive income reserve | - | - | (1,167) | - | (1,167) | - | (1,167) |
Cash flow hedges | - | - | (8,596) | - | (8,596) | - | (8,596) |
Retirement benefit remeasurements | - | - | - | 325 | 325 | - | 325 |
Own credit | - | - | 1,526 | - | 1,526 | - | 1,526 |
Total comprehensive income for the period | - | 620 | (4,804) | 4,312 | 128 | 23 | 151 |
Employee share schemes and hedging thereof | 46 | - | - | 383 | 429 | - | 429 |
Issue and redemption of other equity instruments | - | 1,032 | - | 20 | 1,052 | (20) | 1,032 |
Other equity instruments coupon paid | - | (620) | - | - | (620) | - | (620) |
Disposal of ABSA holding | - | - | (84) | 84 | - | - | - |
Vesting of employee share schemes | - | - | 7 | (473) | (466) | - | (466) |
Dividends paid | - | - | - | (1,028) | (1,028) | (23) | (1,051) |
Repurchase of shares | (224) | - | 224 | (1,491) | (1,491) | - | (1,491) |
Own credit realisation | - | - | (36) | 36 | - | - | - |
Other movements | - | (21) | - | (1) | (22) | - | (22) |
Balance as at 30 September 2022 | 4,358 | 13,270 | (2,923) | 52,329 | 67,034 | 969 | 68,003 |
Three months ended 30.09.22 | |||||||
Balance as at 1 July 2022 | 4,508 | 12,357 | (218) | 52,980 | 69,627 | 969 | 70,596 |
Profit after tax | - | 206 | - | 1,512 | 1,718 | 2 | 1,720 |
Currency translation movements | - | - | 1,730 | - | 1,730 | - | 1,730 |
Fair value through other comprehensive income reserve | - | - | (408) | - | (408) | - | (408) |
Cash flow hedges | - | - | (4,778) | - | (4,778) | - | (4,778) |
Retirement benefit remeasurements | - | - | - | (765) | (765) | - | (765) |
Own credit | - | - | 671 | - | 671 | - | 671 |
Total comprehensive income for the period | - | 206 | (2,785) | 747 | (1,832) | 2 | (1,830) |
Employee share schemes and hedging thereof | 13 | - | - | (34) | (21) | - | (21) |
Issue and redemption of other equity instruments | - | 917 | - | (5) | 912 | - | 912 |
Other equity instruments coupon paid | - | (206) | - | - | (206) | - | (206) |
Disposal of ABSA holding | - | - | (45) | 45 | - | - | - |
Vesting of employee share schemes | - | - | - | (9) | (9) | - | (9) |
Dividends paid | - | - | - | (364) | (364) | (2) | (366) |
Repurchase of shares | (163) | - | 163 | (1,059) | (1,059) | - | (1,059) |
Own credit realisation | - | - | (36) | 36 | - | - | - |
Other movements | - | (4) | (2) | (8) | (14) | - | (14) |
Balance as at 30 September 2022 | 4,358 | 13,270 | (2,923) | 52,329 | 67,034 | 969 | 68,003 |
1 | 2021 financial metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
As at 30.09.22 | As at 31.12.21 | |
Other reserves | £m | £m |
Currency translation reserve | 6,173 | 2,740 |
Fair value through other comprehensive income reserve | (1,534) | (283) |
Cash flow hedging reserve | (9,449) | (853) |
Own credit reserve | 530 | (960) |
Other reserves and treasury shares | 1,357 | 1,126 |
Total | (2,923) | 1,770 |
Over-issuance of US securities under the Barclays Bank PLC US Shelf
Restatement of financial statements
A proportion of the costs associated with the rights of rescission of certain investors are attributable to BPLC's financial statements for the year ended 31 December 2021. The comparatives in the quarterly financial information for 2021 and for the nine months ended 30 September 2021, including those in the consolidated income statement, the consolidated balance sheet and the consolidated statement of changes in equity included in this document, have been restated to reflect a provision in respect of the impact of the Over-issuance of Securities.
The table below reflects each of the consolidated financial statement line items that were affected by the restatement:
Impact on the consolidated income statement | As reported | Restatement | As restated | ||
Nine months ended 30.09.21 | £m | £m | £m | ||
Litigation and conduct | (131) | (174) | (305) | ||
Operating expenses | (10,709) | (174) | (10,883) | ||
Profit before tax | 6,940 | (174) | 6,766 | ||
Taxation | (1,076) | 42 | (1,034) | ||
Profit after tax | 5,864 | (132) | 5,732 | ||
Year ended 31.12.21 | £m | £m | £m | ||
Litigation and conduct | (177) | (220) | (397) | ||
Operating expenses | (14,439) | (220) | (14,659) | ||
Profit before tax | 8,414 | (220) | 8,194 | ||
Taxation | (1,188) | 50 | (1,138) | ||
Profit after tax | 7,226 | (170) | 7,056 | ||
Impact on the consolidated balance sheet | |||||
As at 31.12.21 | £m | £m | £m | ||
Current tax liabilities | 739 | (50) | 689 | ||
Provisions | 1,688 | 220 | 1,908 | ||
Total liabilities | 1,314,074 | 170 | 1,314,244 | ||
Retained earnings | 50,657 | (170) | 50,487 | ||
Total equity | 70,211 | (170) | 70,041 |
This omission in the financial statements has resulted in the restatement of the prior period Capital comparatives with the following impact:
· | CET1 capital decreased £0.2bn from £47.5bn to £47.3bn. Both transitional and fully loaded CET1 ratios remained unchanged at 15.1% and 14.7% respectively. The transitional T1 ratio moved from 19.2% to 19.1% and Total transitional capital ratio moved from 22.3% to 22.2% |
· | Leverage exposure increased by £1.9bn with the UK leverage ratio decreasing from 5.3% to 5.2% and the average UK leverage ratio remaining unchanged at 4.9% |
· | Total own funds and eligible liabilities decreased £0.2bn to £108bn, which was in excess of a restated requirement to hold £94bn of own funds and eligible liabilities |
Update on related litigation and conduct matters
Over-issuance of Securities under the Barclays Bank PLC US Shelf
In September 2022, the SEC announced the resolution of its investigation of BPLC and BBPLC relating to the Over-issuance of Securities by BBPLC under certain of its US shelf registration statements. Pursuant to the terms of the resolution, BPLC and BBPLC will pay a combined penalty of $200m (£165m1), without admitting or denying the SEC's findings. The SEC has confirmed that the independent rescission offer made by BBPLC to holders of the relevant over-issued securities (which offer commenced on 1 August 2022 and expired on 12 September 2022) satisfies its requirements for disgorgement and related prejudgment interest.
The Group is engaged with, and responding to inquiries and requests for information from, various other regulators who may seek to impose fines, penalties and/or other sanctions as a result of this matter. Furthermore, BBPLC and/or its affiliates may incur costs and liabilities in relation to private civil claims which have been filed and may face other potential private civil claims, class actions or other enforcement actions in relation to this matter. For example, in September 2022, a purported class action claim was filed in the US District Court in Manhattan by two Florida pension plans seeking to hold BPLC and former and current executives responsible for declines in the prices of its American depositary receipts, which plaintiffs claim occurred as a result of alleged misstatements and omissions in its public disclosures.
Any liabilities, claims or actions in connection with the Over-issuance of Securities under BBPLC's US shelf registration statements could have an adverse effect on the Group's business, financial condition, results of operations and reputation as a frequent issuer in the securities markets.
1 | Exchange rate GBP/USD 1.22 as at 30 June 2022. |
Appendix: Non-IFRS Performance Measures
The Group's management believes that the non-IFRS performance measures included in this document provide valuable information to the readers of the financial statements as they enable the reader to identify a more consistent basis for comparing the businesses' performance between financial periods, and provide more detail concerning the elements of performance which the managers of these businesses are most directly able to influence or are relevant for an assessment of the Group. They also reflect an important aspect of the way in which operating targets are defined and performance is monitored by management.
However, any non-IFRS performance measures in this document are not a substitute for IFRS measures and readers should consider the IFRS measures as well.
Non-IFRS performance measures glossary
Measure | Definition |
Loan: deposit ratio | Loans and advances at amortised cost divided by deposits at amortised cost. |
Period end allocated tangible equity | Allocated tangible equity is calculated as 13.5% (2021: 13.5%) of RWAs for each business, adjusted for capital deductions, excluding goodwill and intangible assets, reflecting the assumptions the Group uses for capital planning purposes. Head Office allocated tangible equity represents the difference between the Group's tangible shareholders' equity and the amounts allocated to businesses. |
Average tangible shareholders' equity | Calculated as the average of the previous month's period end tangible equity and the current month's period end tangible equity. The average tangible shareholders' equity for the period is the average of the monthly averages within that period. |
Average allocated tangible equity | Calculated as the average of the previous month's period end allocated tangible equity and the current month's period end allocated tangible equity. The average allocated tangible equity for the period is the average of the monthly averages within that period. |
Return on average tangible shareholders' equity | Annualised profit after tax attributable to ordinary equity holders of the parent, as a proportion of average shareholders' equity excluding non-controlling interests and other equity instruments adjusted for the deduction of intangible assets and goodwill. The components of the calculation have been included on pages 54 to 56. |
Return on average allocated tangible equity | Annualised profit after tax attributable to ordinary equity holders of the parent, as a proportion of average allocated tangible equity. The components of the calculation have been included on pages 54 to 57. |
Cost: income ratio | Total operating expenses divided by total income. |
Loan loss rate | Quoted in basis points and represents total annualised impairment charges divided by gross loans and advances held at amortised cost at the balance sheet date. |
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 25. |
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 58. |
Returns
Return on average tangible equity is calculated as profit after tax attributable to ordinary equity holders of the parent as a proportion of average tangible equity, excluding non-controlling and other equity interests for businesses. Allocated tangible equity has been calculated as 13.5% (2021: 13.5%) of RWAs for each business, adjusted for capital deductions, excluding goodwill and intangible assets, reflecting the assumptions the Group uses for capital planning purposes. Head Office average allocated tangible equity represents the difference between the Group's average tangible shareholders' equity and the amounts allocated to businesses.
Profit/(loss) attributable to ordinary equity holders of the parent | Average tangible equity | Return on average tangible equity | |||
Nine months ended 30.09.22 | £m | £bn | % | ||
Barclays UK | 1,403 | 10.0 | 18.7 | ||
Corporate and Investment Bank | 2,910 | 32.5 | 11.9 | ||
Consumer, Cards and Payments | 309 | 4.7 | 8.9 | ||
Barclays International | 3,219 | 37.2 | 11.5 | ||
Head Office | (635) | 1.6 | n/m | ||
Barclays Group | 3,987 | 48.8 | 10.9 | ||
Nine months ended 30.09.211 | |||||
Barclays UK | 1,336 | 9.9 | 17.9 | ||
Corporate and Investment Bank | 3,337 | 28.2 | 15.8 | ||
Consumer, Cards and Payments | 492 | 4.0 | 16.2 | ||
Barclays International | 3,829 | 32.2 | 15.9 | ||
Head Office | (39) | 5.0 | n/m | ||
Barclays Group | 5,126 | 47.1 | 14.5 |
1 | 2021 financial metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Nine months ended 30.09.22 | ||||||
Barclays UK | Corporate and Investment Bank | Consumer, Cards and Payments | Barclays International | Head Office | Barclays Group | |
Return on average tangible shareholders' equity | £m | £m | £m | £m | £m | £m |
Attributable profit/(loss) | 1,403 | 2,910 | 309 | 3,219 | (635) | 3,987 |
£bn | £bn | £bn | £bn | £bn | £bn | |
Average shareholders' equity | 13.6 | 32.5 | 5.6 | 38.1 | 5.2 | 56.9 |
Average goodwill and intangibles | (3.6) | - | (0.9) | (0.9) | (3.6) | (8.1) |
Average tangible shareholders' equity | 10.0 | 32.5 | 4.7 | 37.2 | 1.6 | 48.8 |
Return on average tangible shareholders' equity | 18.7% | 11.9% | 8.9% | 11.5% | n/m | 10.9% |
Nine months ended 30.09.211 | ||||||
Barclays UK | Corporate and Investment Bank | Consumer, Cards and Payments | Barclays International | Head Office | Barclays Group | |
Return on average tangible shareholders' equity | £m | £m | £m | £m | £m | £m |
Attributable profit/(loss) | 1,336 | 3,337 | 492 | 3,829 | (39) | 5,126 |
£bn | £bn | £bn | £bn | £bn | £bn | |
Average shareholders' equity | 13.5 | 28.2 | 4.7 | 32.9 | 8.7 | 55.1 |
Average goodwill and intangibles | (3.6) | - | (0.7) | (0.7) | (3.7) | (8.0) |
Average tangible shareholders' equity | 9.9 | 28.2 | 4.0 | 32.2 | 5.0 | 47.1 |
Return on average tangible shareholders' equity | 17.9% | 15.8% | 16.2% | 15.9% | n/m | 14.5% |
1 | 2021 financial metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Barclays Group | ||||||||||
Return on average tangible shareholders' equity | Q322 | Q222 | Q122 | Q4211 | Q3211 | Q2211 | Q121 | Q420 | ||
£m | £m | £m | £m | £m | £m | £m | £m | |||
Attributable profit | 1,512 | 1,071 | 1,404 | 1,079 | 1,374 | 2,048 | 1,704 | 220 | ||
£bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | |||
Average shareholders' equity | 56.8 | 57.1 | 56.9 | 56.1 | 56.5 | 54.4 | 54.4 | 55.7 | ||
Average goodwill and intangibles | (8.2) | (8.1) | (8.1) | (8.1) | (8.2) | (7.9) | (7.9) | (8.1) | ||
Average tangible shareholders' equity | 48.6 | 49.0 | 48.8 | 48.0 | 48.3 | 46.5 | 46.5 | 47.6 | ||
Return on average tangible shareholders' equity | 12.5% | 8.7% | 11.5% | 9.0% | 11.4% | 17.6% | 14.7% | 1.8% |
Barclays UK | ||||||||||
Return on average allocated tangible equity | Q322 | Q222 | Q122 | Q421 | Q321 | Q221 | Q121 | Q420 | ||
£m | £m | £m | £m | £m | £m | £m | £m | |||
Attributable profit | 549 | 458 | 396 | 420 | 317 | 721 | 298 | 160 | ||
£bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | |||
Average allocated equity | 13.5 | 13.6 | 13.7 | 13.6 | 13.6 | 13.5 | 13.5 | 13.4 | ||
Average goodwill and intangibles | (3.6) | (3.6) | (3.6) | (3.6) | (3.6) | (3.6) | (3.6) | (3.6) | ||
Average allocated tangible equity | 9.9 | 10.0 | 10.1 | 10.0 | 10.0 | 9.9 | 9.9 | 9.8 | ||
Return on average allocated tangible equity | 22.1% | 18.4% | 15.6% | 16.8% | 12.7% | 29.1% | 12.0% | 6.5% |
1 | 2021 financial metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Barclays International | ||||||||||
Return on average allocated tangible equity | Q322 | Q222 | Q122 | Q4211 | Q3211 | Q2211 | Q121 | Q420 | ||
£m | £m | £m | £m | £m | £m | £m | £m | |||
Attributable profit | 1,136 | 783 | 1,300 | 818 | 1,191 | 1,207 | 1,431 | 441 | ||
£bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | |||
Average allocated equity | 40.1 | 38.2 | 36.0 | 33.8 | 32.7 | 33.0 | 32.8 | 31.1 | ||
Average goodwill and intangibles | (1.0) | (0.9) | (0.9) | (0.9) | (0.9) | (0.6) | (0.5) | (0.6) | ||
Average allocated tangible equity | 39.1 | 37.3 | 35.1 | 32.9 | 31.8 | 32.4 | 32.3 | 30.5 | ||
Return on average allocated tangible equity | 11.6% | 8.4% | 14.8% | 9.9% | 14.9% | 14.9% | 17.7% | 5.8% | ||
Corporate and Investment Bank | ||||||||||
Return on average allocated tangible equity | Q322 | Q222 | Q122 | Q4211 | Q3211 | Q2211 | Q121 | Q420 | ||
£m | £m | £m | £m | £m | £m | £m | £m | |||
Attributable profit | 1,015 | 579 | 1,316 | 695 | 1,085 | 989 | 1,263 | 413 | ||
£bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | |||
Average allocated equity | 34.0 | 32.7 | 30.8 | 28.7 | 27.8 | 28.4 | 28.2 | 26.3 | ||
Average goodwill and intangibles | - | - | - | - | - | - | - | - | ||
Average allocated tangible equity | 34.0 | 32.7 | 30.8 | 28.7 | 27.8 | 28.4 | 28.2 | 26.3 | ||
Return on average allocated tangible equity | 11.9% | 7.1% | 17.1% | 9.7% | 15.6% | 14.0% | 17.9% | 6.3% | ||
Consumer, Cards and Payments | ||||||||||
Return on average allocated tangible equity | Q322 | Q222 | Q122 | Q421 | Q321 | Q221 | Q121 | Q420 | ||
£m | £m | £m | £m | £m | £m | £m | £m | |||
Attributable profit/(loss) | 121 | 204 | (16) | 123 | 106 | 218 | 168 | 28 | ||
£bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | |||
Average allocated equity | 6.1 | 5.5 | 5.2 | 5.1 | 4.9 | 4.6 | 4.6 | 4.8 | ||
Average goodwill and intangibles | (1.0) | (0.9) | (0.9) | (0.9) | (0.9) | (0.6) | (0.5) | (0.6) | ||
Average allocated tangible equity | 5.1 | 4.6 | 4.3 | 4.2 | 4.0 | 4.0 | 4.1 | 4.2 | ||
Return on average allocated tangible equity | 9.5% | 17.8% | (1.5)% | 11.7% | 10.5% | 21.8% | 16.5% | 2.7% | ||
1 | 2021 financial metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Tangible net asset value per share | As at 30.09.22 | Restated1 As at 31.12.21 | Restated1 As at 30.09.21 |
£m | £m | £m | |
Total equity excluding non-controlling interests | 67,034 | 69,052 | 68,565 |
Other equity instruments | (13,270) | (12,259) | (12,252) |
Goodwill and intangibles | (8,371) | (8,061) | (8,147) |
Tangible shareholders' equity attributable to ordinary shareholders of the parent | 45,393 | 48,732 | 48,166 |
m | m | m | |
Shares in issue | 15,888 | 16,752 | 16,851 |
p | p | p | |
Tangible net asset value per share | 286 | 291 | 286 |
1 | 2021 financial metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
Notable Items | |||||
Nine months ended 30.09.22 | Three months ended 30.09.22 | ||||
£m | Profit before tax | Attributable profit | Profit before tax | Attributable profit | |
Statutory | 5,702 | 3,987 | 1,969 | 1,512 | |
Net impact from the Over-issuance of Securities | (674) | (552) | 37 | 29 | |
Customer remediation costs on legacy loan portfolio | (282) | (228) | (101) | (81) | |
Settlements in principle in respect of industry-wide devices investigations by SEC and CFTC | (165) | (165) | - | - | |
Other litigation and conduct | (105) | (98) | (63) | (60) | |
Re-measurement of UK DTAs | - | (346) | - | - | |
Excluding the impact of notable items | 6,928 | 5,376 | 2,096 | 1,624 | |
Nine months ended 30.09.21 | Three months ended 30.09.21 | ||||
£m | Profit before tax | Attributable profit | Profit before tax | Attributable profit | |
Statutory1 | 6,766 | 5,126 | 1,864 | 1,374 | |
Net impact from the Over-issuance of Securities | (174) | (132) | (97) | (73) | |
Structural cost action - June 2021 real estate review | (266) | (203) | - | - | |
Other litigation and conduct | (131) | (107) | (32) | (21) | |
Re-measurement of UK DTAs | - | 402 | - | 10 | |
Excluding the impact of notable items | 7,337 | 5,166 | 1,993 | 1,458 | |
1 | 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Supplementary Information on page 51 for more information. |
The Group's management believes that the Non-GAAP financial measures excluding notable items, included in the table above, provide valuable information to enable users of the financial statements to assess the performance of the Group. The notable items are separately identified within the Group's results disclosures which, when excluded from Barclays' statutory financials, provide an underlying profit and loss performance of the Group and enables consistent comparison of performance from one period to another.
These non-GAAP financial measures excluding notable items are included as a reference point only and are not incorporated within any of the key financial metrics used in our Group Targets, which are measured on a statutory basis.
Shareholder Information
% Change2 | ||||||
Exchange rates1 | 30.09.22 | 30.06.22 | 30.09.21 | 30.06.22 | 30.09.21 | |
Period end - USD/GBP | 1.12 | 1.22 | 1.35 | (8)% | (17)% | |
YTD average - USD/GBP | 1.26 | 1.30 | 1.39 | (3)% | (9)% | |
3 month average - USD/GBP | 1.18 | 1.26 | 1.38 | (6)% | (14)% | |
Period end - EUR/GBP | 1.14 | 1.16 | 1.16 | (2)% | (2)% | |
YTD average - EUR/GBP | 1.18 | 1.19 | 1.16 | (1)% | 2% | |
3 month average - EUR/GBP | 1.17 | 1.18 | 1.17 | (1)% | - | |
Share price data | ||||||
Barclays PLC (p) | 144.30 | 153.12 | 189.60 | |||
Barclays PLC number of shares (m)3 | 15,888 | 16,531 | 16,851 | |||
For further information please contact | ||||||
Investor relations | Media relations | |||||
Chris Manners +44 (0) 20 7773 2136 | Tom Hoskin +44 (0) 20 7116 4755 | |||||
More information on Barclays can be found on our website: home.barclays | ||||||
Registered office | ||||||
1 Churchill Place, London, E14 5HP, United Kingdom. Tel: +44 (0) 20 7116 1000. Company number: 48839. | ||||||
Registrar | ||||||
Equiniti, Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, United Kingdom. | ||||||
Tel: 0371 384 20554 from the UK or +44 121 415 7004 from overseas. | ||||||
American Depositary Receipts (ADRs) | ||||||
EQ Shareowner Services | ||||||
P.O. Box 64504 | ||||||
St. Paul, MN 55164-0854 | ||||||
United States of America | ||||||
shareowneronline.com/information/contact-us | ||||||
Toll Free Number: +1 800-990-1135 | ||||||
Outside the US +1 651-453-2128 | ||||||
Delivery of ADR certificates and overnight mail | ||||||
EQ Shareowner Services, 1110 Centre Pointe Curve, Suite 101, Mendota Heights, MN 55120-4100, USA. | ||||||
1 | The average rates shown above are derived from daily spot rates during the year. |
2 | The change is the impact to GBP reported information. |
3 | The number of shares of 15,888m as at 30 September is different from the 15,865m quoted in the 3 October 2022 announcement because the share buyback transactions executed on 29 and 30 September 2022 did not settle until 1 October 2022 and 3 October 2022 respectively. |
4 | Lines open 8.30am to 5.30pm (UK time), Monday to Friday, excluding UK public holidays in England and Wales. |