1st Quarter Results

RNS Number : 6225D
Barclays PLC
28 April 2017
 

 

Barclays PLC

Q1 2017 Results Announcement

 

31 March 2017

 

Performance Highlights

 

Transatlantic Consumer, Corporate and Investment Bank with Global Reach

Good execution of the strategy evidenced by strong Core performance and reduced Non-Core drag

 

• Core returns:

• Strong Core Return on Tangible Equity (RoTE) of 11.0% (Q116: 9.9%), on an average allocated tangible equity base that was £5bn higher year-on-year, as 12% income growth drove a 20% increase in profit before tax

• Barclays UK RoTE increased to 21.6% and Barclays International RoTE improved to 12.5%

• Non-Core rundown:

• Good progress on the rundown, with a materially lower loss before tax of £241m (Q116: £815m)

• Risk weighted assets (RWAs) reduced £5bn to £27bn in Q117, and on track to close Non-Core at 30 June 2017 with approximately £25bn of RWAs

• Cost efficiency:

• Group cost: income ratio improved to 62% (Q116: 76%) driven by a reduction in Non-Core costs to £157m (Q116: £555m) and positive cost: income jaws in Core

• Core cost: income ratio reduced to 59% (Q116: 62%)

• Remain on track to deliver Group cost: income ratio below 60% over time

• Barclays Africa Group Limited (BAGL) discontinued operation:

• Impairment of Barclays' holding in BAGL allocated to acquisition goodwill of £884m, primarily driven by the 17% decline in BAGL's share price in the quarter. This had no impact on the Group's Common Equity Tier 1 (CET1) capital and tangible net asset value (TNAV)

• On track to achieve regulatory deconsolidation, with further selldown subject to regulatory approval. Estimate c.75bps Group CET1 ratio accretion on regulatory deconsolidation, based on the 31 March 2017 BAGL share price and ZAR exchange rate

• Common Equity Tier 1 (CET1) ratio:

• CET1 ratio increased to 12.5% (December 2016: 12.4%), with strong organic capital generation partially offset by the redemption of USD preference shares, purchase of shares for employee share awards and pension contributions

• On track to meet end-state capital ratio level

• Holding Company (HoldCo) transition:

• Further progressed the transition to HoldCo funding with £6.3bn equivalent of issuance

• Q117 included the redemption of $1.375bn 7.1% Series 3 USD preference shares

 

Improved Group profitability driven by double digit Core RoTE and lower impact from Non-Core

 

Group profit before tax more than doubled to £1,682m driven by improved profitability in the Core and materially lower losses in Non-Core of £241m (Q116: £815m). Core basic earnings per share increased to 7.2p (Q116: 5.8p)

Barclays UK RoTE improved to 21.6% (Q116: 20.5%), with 2% income growth driving an improved cost: income ratio of 52% (Q116: 53%). Net interest margin (NIM) improved 7bps to 3.69% with net interest income increasing 1% to £1,511m

Barclays International RoTE improved to 12.5% (Q116: 9.5%) as profit before tax increased 32% to £1,356m. Consumer, Cards and Payments RoTE was 36.4% (Q116: 23.4%) while the Corporate and Investment Bank RoTE improved to 8.2% (Q116: 7.3%)

Basic earnings per share in respect of continuing operations increased to 6.1p (Q116: 2.2p)

Attributable loss in respect of discontinued operation of £801m due to an impairment of Barclays' holding in BAGL allocated to acquisition goodwill of £884m

Group RoTE decreased to 1.8% (Q116: 3.8%) due to a 7.2% dilutive impact from the impairment of Barclays' holding in BAGL allocated to acquisition goodwill

Tangible net asset value per share increased to 292p (December 2016: 290p) primarily due to profits generated in the period

 

James E Staley, Group Chief Executive Officer, said:

 

"This has been another quarter of strong progress towards the completion of the restructuring of Barclays.

 

Group profit before tax more than doubled compared to Q1 of 2016, and our Core businesses continued to perform very well, producing a combined Return on Tangible Equity of 11%, on an average tangible equity base that is £5bn higher year-on-year. Within that, Barclays UK's and Barclays International's RoTEs both improved to 21.6% and 12.5% respectively.

 

Non-Core rundown carries on apace, with materially lower losses, and RWAs reducing by a further £5bn to £27bn in the quarter. We remain well on track to close the unit on the 30th of June.     

 

Crucially, in this quarter, as we reduce that Non-Core drag, we can see more clearly than ever before the growing convergence between our Core RoTE of 11%, and the Group RoTE of 9%, excluding the one-off impairment in respect of our African operations. That convergence has been the central strategic objective in the accelerated strategy we have been pursuing over the past year.

 

Our Group cost to income ratio has improved to 62%, compared to 76% for the first quarter of 2016, driven by a marked reduction in Non-Core costs and positive jaws in the Core.

 

On Africa, we await approval for the separation arrangements already agreed with local management, following which we will be able to make further progress towards regulatory deconsolidation.

 

The earnings power of Barclays enabled us to take actions in the quarter including the redemption of US dollar preference shares, the purchase of shares for employee awards, and pension contributions, while still improving our CET1 ratio to 12.5% through organic capital generation, and that is pleasing.

 

We are now just two months away from completing the restructuring of Barclays as a Transatlantic Consumer, Corporate and Investment Bank and there is further good reason in this quarter's performance to feel optimistic for our prospects."

 

James E Staley, Group Chief Executive Officer

 

Barclays Group results


for the three months ended

31.03.17

31.03.16



£m

£m

% Change

Total income

5,823

5,041

16

Credit impairment charges and other provisions

(527)

(443)

(19)

Net operating income

5,296

4,598

15

Operating expenses excluding litigation and conduct

(3,591)

(3,747)

4

Litigation and conduct

(28)

(78)

64

Operating expenses

(3,619)

(3,825)

5

Other net income

5

20

(75)

Profit before tax

1,682

793


Tax charge

(473)

(248)

(91)

Profit after tax in respect of continuing operations 

1,209

545


(Loss)/profit after tax in respect of discontinued operation1

(658)

166


Non-controlling interests in respect of continuing operations

(79)

(94)

16

Non-controlling interests in respect of discontinued operation1

(143)

(80)

(79)

Other equity holders2

(139)

(104)

(34)

Attributable profit

190

433

(56)





Performance measures




Return on average tangible shareholders' equity2

1.8%

3.8%


Average tangible shareholders' equity (£bn)

49

48


Cost: income ratio

62%

76%


Loan loss rate (bps)

47

40






Basic earnings per share2

1.3p

2.7p


Basic earnings per share in respect of continuing operations2

6.1p

2.2p


  





As at

As at

As at

Balance sheet and capital management

31.03.17

31.12.16

31.03.16

Tangible net asset value per share

292p

290p

286p

Common equity tier 1 ratio

12.5%

12.4%

11.3%

Common equity tier 1 capital

£44.9bn

£45.2bn

£40.9bn

Risk weighted assets

£361bn

£366bn

£363bn

UK leverage ratio (quarterly month end average)3

4.6%

4.5%

n/a

Fully loaded tier 1 capital (quarterly month end average)3

£52.3bn

£51.6bn

n/a

UK leverage exposure (quarterly month end average)3

£1,130bn

£1,137bn

n/a





Funding and liquidity




Group liquidity pool

£185bn

£165bn

£132bn

CRD IV liquidity coverage ratio

140%

131%

129%

Loan: deposit ratio4

82%

83%

84%

 

 

1

Refer to page 17 for further information relating to the Africa Banking discontinued operation. Loss after tax in respect of discontinued operation includes impairment of Barclays' holding in BAGL allocated to acquisition goodwill of £884m.

2

The profit after tax attributable to other equity holders of £139m (Q116: £104m) is offset by a tax credit recorded in reserves of £38m (Q116: £29m). The net amount of £101m (Q116: £75m), along with non-controlling interests (NCI) is deducted from profit after tax in order to calculate earnings per share and return on average tangible shareholders' equity.

3

The UK leverage ratio uses capital and exposure measures based on the average of the last day of each month in the quarter; additionally, the average exposure measure excludes qualifying central bank claims.

4

Loan: deposit ratio for Barclays UK, Barclays International and Non-Core, excluding investment banking businesses.

 

Barclays Core and Non-Core

results for the three months ended

Barclays Core


Barclays Non-Core

31.03.17

31.03.16



31.03.17

31.03.16



£m

£m

% Change


£m

£m

% Change

Total income

5,897

5,283

12


(74)

(242)

69

Credit impairment charges and other provisions

(524)

(414)

(27)


(3)

(29)

90

Net operating income/(expenses)

5,373

4,869

10


(77)

(271)

72

Operating expenses excluding litigation and conduct

(3,443)

(3,258)

(6)


(148)

(489)

70

Litigation and conduct

(19)

(12)

(58)


(9)

(66)

86

Operating expenses

(3,462)

(3,270)

(6)


(157)

(555)

72

Other net income/(expenses)

12

9

33


(7)

11


Profit/(loss) before tax

1,923

1,608

20


(241)

(815)

70

Tax (charge)/credit

(548)

(485)

(13)


75

237

(68)

Profit/(loss) after tax 

1,375

1,123

22


(166)

(578)

71

Non-controlling interests

(70)

(84)

17


(9)

(10)

10

Other equity holders

(121)

(89)

(36)


(18)

(15)

(20)

Attributable profit/(loss)1

1,184

950

25


(193)

(603)

68









Performance measures








Return on average allocated tangible equity

11.0%

9.9%






Average allocated tangible equity (£bn)1

44

39



5

9


Period end allocated tangible equity (£bn)1

45

40



5

9


Cost: income ratio

59%

62%



n/m

n/m


Loan loss rate (bps)

53

42



2

21


Basic earnings/(loss) per share contribution

7.2p

5.8p



(1.1p)

(3.6p)











As at

As at

As at


As at

As at

As at

Capital management

31.03.17

31.12.16

31.03.16


31.03.17

31.12.16

31.03.16

Risk weighted assets1

£334bn

£334bn

£312bn


£27bn

£32bn

£51bn

UK leverage exposure(quarterly month end average)1

£1,035bn

£1,026bn

n/a 


£95bn

£111bn

n/a

 

 

1

Attributable profit in respect of the Africa Banking discontinued operation is reported at the Group level only. Allocated tangible equity, RWAs and leverage exposure are reported in Head Office within Core.

 

 

Three months ended

Three months ended



31.03.17

31.03.16


Income by business

£m

£m

% Change

Barclays UK

1,841

1,803

2

Barclays International

4,138

3,513

18

Head Office

(82)

(33)


Barclays Core

5,897

5,283

12

Barclays Non-Core

(74)

(242)

69

Barclays Group

5,823

5,041

16

 

 

 

 

 

 

Profit/(loss) before tax by business




Barclays UK

708

704

1

Barclays International

1,356

1,027

32

Head Office

(141)

(123)

(15)

Barclays Core

1,923

1,608

20

Barclays Non-Core

(241)

(815)

70

Barclays Group

1,682

793


 

Group Finance Director's Review

 

Performance in the first quarter of 2017 demonstrated good progress towards the completion of Barclays' restructuring, with improved Group profit before tax, a significantly reduced cost: income ratio and a robust capital position. The Core business delivered a double digit RoTE on a materially increased average tangible equity base, with strong profit growth reflecting continued evidence of the benefits of diversification across customers and clients, geographies and products. Strong progress also continued on the rundown of Non-Core, towards closure at 30 June 2017, with further RWA reductions in the quarter and a materially reduced drag on Group profitability. Confidence remains in meeting end-state capital requirements, with further CET1 ratio accretion in the quarter.

 

Group performance

 

•

Profit before tax more than doubled to £1,682m (Q116: £793m), with increased income and a reduction in operating expenses delivering an improved cost: income ratio of 62% (Q116: 76%). The appreciation of average USD and EUR against GBP of 14% and 11% respectively positively impacted income and adversely affected impairment and operating expenses

•

The Group performance reflected strong Core results, in which profit before tax increased 20% to £1,923m, and a materially reduced drag from the Non-Core, which reported a loss before tax of £241m (Q116: £815m)

•

Total income increased 16% to £5,823m, driven by a 12% increase in income in the Core, predominantly in Barclays International, and a 69% reduction in Non-Core negative income to £74m

•

Credit impairment charges increased 19% to £527m, driven by a £121m increase in Consumer, Cards and Payments mainly reflecting a change in portfolio mix in US Cards and business growth. As a result, the Group loan loss rate increased to 47bps (Q116: 40bps)

•

Operating expenses reduced 5% to £3,619m due to a 72% reduction in Non-Core operating expenses to £157m. Operating expenses in the Core increased 6% to £3,462m as the change in compensation awards introduced in Q416 and business growth more than offset cost efficiencies

•

Loss after tax in respect of the Africa Banking discontinued operation of £658m (Q116: profit of £166m) reflected an £884m impairment of Barclays' holding in BAGL allocated to acquisition goodwill

•

Return on average tangible shareholders' equity of 1.8% (Q116: 3.8%) included a 7.2% impact from the impairment of Barclays' holding in BAGL allocated to acquisition goodwill, while basic earnings per share was 1.3p (Q116: 2.7p). Basic earnings per share in respect of continuing operations was 6.1p (Q116: 2.2p)

 

Core performance

 

•

The Core business generated a double digit RoTE of 11.0% (Q116: 9.9%), on a £5bn higher average tangible equity base of £44bn, reflecting Core earnings generation and capital reallocated from Non-Core

•

Profit before tax increased 20% to £1,923m representing 32% profit growth in Barclays International, including the benefit of the appreciation of average USD and EUR against GBP, and solid performance in Barclays UK

•

Total income increased 12% to £5,897m, as Barclays UK income increased 2% to £1,841m and Barclays International income increased 18% to £4,138m, with growth across both the Corporate and Investment Bank (CIB) and Consumer, Cards and Payments

•

Credit impairment charges increased 27% to £524m resulting in an 11bps increase in the loan loss rate to 53bps, driven by increased impairment in Consumer, Cards and Payments mainly reflecting a change in portfolio mix in US cards and business growth, and an increase in Barclays UK

•

Operating expenses increased 6% to £3,462m as the impact of the change in compensation awards introduced in Q416 and balance growth in Consumer, Cards and Payments were partially offset by cost efficiencies. Positive cost: income jaws delivered an improved cost: income ratio of 59% (Q116: 62%)

 

Barclays UK

 

•

RoTE increased to 21.6% (Q116: 20.5%) with profit before tax broadly in line at £708m (Q116: £704m). The cost: income ratio improved to 52% (Q116: 53%)

•

Total income increased 2% to £1,841m driven by a 1% increase in net interest income to £1,511m as deposit growth and pricing initiatives more than offset the headwinds the UK base rate cut in 2016 and asset margin pressure, as well as reflecting a valuation gain on Barclays' preference shares in Visa Inc. of £24m. The net interest margin increased 7bps to 3.69%


-

Personal Banking income increased 3% to £944m driven by improved deposit margins, balance growth and the valuation gain on Barclays' preference shares in Visa Inc., partially offset by the headwinds the UK base rate cut in 2016 and asset margin pressure


-

Barclaycard Consumer UK income increased 1% to £498m reflecting growth in balances


-

Wealth, Entrepreneurs & Business Banking income increased 2% to £399m

•

Credit impairment charges increased £32m year-on-year to £178m due to higher provision releases and recoveries in Q116, though remained stable on Q416. Underlying delinquency trends reduced year-on-year, with 30 and 90 day arrears rates in UK cards of 2.0% (Q116: 2.3%) and 0.9% (Q116: 1.2%) respectively

•

Operating expenses were broadly in line at £955m (Q116: £953m) as costs of setting up the ring-fenced bank and investment in cyber resilience and technology were offset by cost efficiencies

 

Barclays International

 

•

RoTE improved to 12.5% (Q116: 9.5%), driven by improvements in both CIB and Consumer, Cards and Payments to 8.2% (Q116: 7.3%) and 36.4% (Q116: 23.4%) respectively

•

Profit before tax increased 32% to £1,356m reflecting solid CIB results and continued momentum in Consumer, Cards and Payments

•

Total income increased 18% to £4,138m as CIB income increased 7% to £2,782m and Consumer, Cards and Payments income increased 48% to £1,356m, reflecting the benefit from the appreciation of average USD and EUR against GBP


-

Banking income increased 18% to £1,393m driven by a 51% increase in Banking fees to £726m, reflecting increased income in debt underwriting, equity underwriting and advisory. Corporate lending reduced 9% to £269m due to increased losses on fair value hedges, partially offset by improved balance growth. Transactional banking declined 2% to £398m primarily driven by deposit margin compression


-

Markets income decreased 4% to £1,351m reflecting a 14% reduction in Macro income to £490m, due to weaker performance in US rates and the impact of exiting energy-related commodities, as well as a 10% reduction in Equities to £462m driven by lower US equity derivatives, partially offset by improved performance in equity financing and cash equities. Credit income increased 24% to £399m driven by continued strength in the flow business and improved performance in municipals


-

Consumer, Cards and Payments income increased 48% to £1,356m driven by a gain of £192m relating to an asset sale in US cards, a valuation gain on Barclays' preference shares in Visa Inc. of £74m, and continued growth in US cards

•

Credit impairment charges increased 29% to £346m


-

Consumer, Cards and Payments impairment charges increased £121m to £295m, largely driven by a change in portfolio mix in US Cards, business growth and the appreciation of average USD and EUR against GBP. Impairment trends in US cards increased marginally year-on-year, with 30 and 90 day arrears rates of 2.3% (Q116: 2.2%) and 1.2% (Q116: 1.1%) respectively


-

CIB impairment charges decreased 46% to £51m primarily due to the non-recurrence of single name charges in Q116 largely in respect of counterparties in the oil and gas sector

•

Operating expenses increased 10% to £2,448m, including the appreciation of average USD and EUR against GBP. CIB operating expenses increased 8% due to the change in compensation awards introduced in Q416, partially offset by a reduction in restructuring charges, while Consumer, Cards and Payments operating expenses increased 19% reflecting continued business growth

•

Changes in the balance sheet in Q117 reflected the realignment of certain clients between Barclays UK and Barclays International in preparation for structural reform

 

Head Office

 

•

Loss before tax increased to £141m (Q116: £123m) reflecting lower net income from treasury operations, partially offset by a reduction in operating expenses reflecting increased cost allocations to businesses

•

Following the early adoption of the own credit provisions of IFRS 9 on 1 January 2017, own credit, which was previously recorded in the income statement (Q116: £109m expense) is now recognised within other comprehensive income

•

Average allocated tangible equity, which includes equity relating to the Africa Banking discontinued operation, increased to £7.6bn (Q116: £5.0bn)

 

Non-Core performance

 

•

The Non-Core rundown continued to progress well with RWAs decreasing to £27bn (Q416: £32bn) driven by a £2bn reduction in Derivatives, a £1bn reduction in Securities and loans, and a £1bn reduction in Businesses

•

Loss before tax decreased to £241m (Q116: £815m) due to reduced operating expenses, lower negative income and lower credit impairment charges, reflecting business exits and continued asset rundown

•

Total income improved £168m to a net expense of £74m


-

Businesses income reduced to £51m (Q116: £196m) due to the completion of the sale of a number of income generating businesses in 2016, including the Barclays Risk Analytics and Index Solutions, Southern European cards and Asia Wealth businesses


-

Securities and loans income improved to £68m (Q116: £402m expense) primarily driven by fair value movements on the ESHLA portfolio, reversing from an expense of £374m in Q116 to a gain of £46m


-

Derivatives was a net expense of £193m (Q116: £36m) reflecting losses on rundown of the portfolio

•

Credit impairment charges improved 90% to £3m driven by lower impairment charges in Europe reflecting business exits

•

Operating expenses improved 72% to £157m driven by the exit of businesses, lower restructuring costs and lower litigation and conduct costs

 

Group capital and leverage

 

•

The fully loaded CRD IV CET1 ratio increased to 12.5% (December 2016: 12.4%) principally due to a reduction in RWAs of £4.8bn to £360.9bn. CET1 capital decreased £0.3bn to £44.9bn


-

Profits relating to continuing operations were largely offset by decreases in other qualifying reserves as a result of the redemption of USD preference shares, the purchase of shares for employee share awards and increased pension contributions which resulted in a higher capital deduction as the UK Retirement Fund (UKRF), the Group's main pension scheme, is in surplus


-

Losses relating to the discontinued operation due to the impairment of Barclays' holding in BAGL allocated to acquisition goodwill of £884m had no impact on CET1 capital as the losses were offset by an equivalent decrease in the goodwill and intangible asset deduction


-

The decrease in RWAs principally reflected the £5bn reduction in Non-Core RWAs, partially offset by increased trading activity in investment banking businesses

•

The average UK leverage ratio increased to 4.6% (December 2016: 4.5%) driven by an increase in the average fully loaded Tier 1 capital to £52.3bn (December 2016: £51.6bn) and a decrease in the average UK leverage exposure to £1,130bn (December 2016: £1,137bn)

•

The CRR leverage ratio decreased to 4.4% (December 2016: 4.6%) driven by a 6% increase in the CRR leverage exposure to £1,197bn (December 2016: £1,125bn) primarily within loans and advances and other assets. Fully loaded Tier 1 capital increased to £53.0bn (December 2016: £52.0bn)

•

Tangible net asset value per share increased to 292p (December 2016: 290p) driven by profit generated in the period

 

Group funding and liquidity

 

•

The Group continued to maintain surpluses to its internal and regulatory requirements. The liquidity pool increased to £185bn (December 2016: £165bn). The overall increase in the liquidity pool reflects increases across a variety of funding sources including continued build of our minimum requirement for own funds and eligible liabilities (MREL), money markets and the Bank of England Term Funding Scheme. The liquidity coverage ratio (LCR) increased to 140% (December 2016: 131%), equivalent to a surplus of £54bn (December 2016: £39bn) to 100%

•

Wholesale funding outstanding excluding repurchase agreements was £166bn (December 2016; £158bn). The Group issued £6.3bn equivalent of capital and term senior unsecured debt from Barclays PLC (HoldCo) of which £5.0bn was in public senior unsecured debt and £1.25bn was in capital instruments. In the same period, £3.0bn of Barclays Bank PLC (OpCo) capital and senior public term instruments either matured or were redeemed, including the $1.375bn 7.1% Series 3 USD preference shares

 

Other matters

 

•

As at 31 March 2017, £1.7bn of the Payment Protection Insurance (PPI) provision remains unutilised (December 2016: £2.0bn). On 2 March 2017, the FCA published its policy statement (PS17/3), communicating a complaints deadline of 29 August 2019 as compared to 30 June 2019 which had previously been proposed. We have also observed an increase in complaint flow from March 2017. Management views its current PPI provision as appropriate. However, we will continue to closely monitor complaint trends and the associated provision adequacy

•

Barclays redeemed its $1.375bn 7.1% Series 3 Non-Cumulative Callable Dollar Preference Shares to manage the cost and regulatory efficiency of non-CRD IV compliant securities. The redemption resulted in a 13bps reduction to the CET1 ratio, but will result in an ongoing reduction in preference share dividends payable of $98m per annum

•

The assessment of impairment of Barclays' holding in BAGL allocated to acquisition goodwill as at 31 March 2017 resulted in an impairment of £884m. This charge is presented within the loss in respect of the discontinued operation in the Group's results. The impairment allocated to acquisition goodwill does not affect the Group's CET1 capital or tangible net asset value as at 31 March 2017 as the Group's CET1 capital excludes goodwill and other intangible assets, but reduces the Group's Net Asset Value by £884m

•

It is estimated that the selldown of the Group's interest in BAGL to a level that enables regulatory deconsolidation to be achieved will result in c.75bps accretion to the Group's CET1 ratio, based on the BAGL share price of ZAR139.51 (31 December 2016: 168.69) and ZAR exchange rate of 16.68 as at 31 March 2017 (31 December 2016: 16.78)

•

Certain legal proceedings and investigations relating to legacy issues remain outstanding. For example, the UK Serious Fraud Office has stated that it intends to make a decision shortly in respect of matters relating to our capital raisings in 2008. This decision could impact on the timing and/or outcome of other actions related to these capital raisings

 

Tushar Morzaria, Group Finance Director

 

Quarterly Results Summary

 

 


 

Barclays Group












Q117


Q416

Q316

Q216

Q116


Q415

Q315

Q215

Income statement information

£m


£m

£m

£m

£m


£m

£m

£m

Net interest income

2,519


2,523

2,796

2,530

2,688


2,726

2,692

2,664

Net fee, commission and other income

3,304


2,469

2,650

3,442

2,353


1,722

2,789

3,797

Total income

5,823


4,992

5,446

5,972

5,041


4,448

5,481

6,461

Credit impairment charges and other provisions

(527)


(653)

(789)

(488)

(443)


(554)

(429)

(393)

Net operating income

5,296


4,339

4,657

5,484

4,598


3,894

5,052

6,068

Operating expenses excluding UK bank levy and litigation and conduct

(3,591)


(3,812)

(3,581)

(3,425)

(3,747)


(3,547)

(3,552)

(3,557)

UK bank levy

-


(410)

-

-

-


(426)

-

-

Litigation and conduct

(28)


(97)

(741)

(447)

(78)


(1,722)

(699)

(927)

Operating expenses

(3,619)


(4,319)

(4,322)

(3,872)

(3,825)


(5,695)

(4,251)

(4,484)

Other net income/(expenses)

5


310

502

(342)

20


(274)

(182)

(39)

Profit/(loss) before tax

1,682


330

837

1,270

793


(2,075)

619

1,545

Tax (charge)/credit

(473)


50

(328)

(467)

(248)


(164)

(133)

(324)

Profit/(loss) after tax in respect of continuing operations

1,209


380

509

803

545


(2,239)

486

1,221

(Loss)/profit after tax in respect of discontinued operation

(658)


71

209

145

166


101

167

162












Attributable to:











Ordinary equity holders of the parent

190


99

414

677

433


(2,422)

417

1,146

Other equity holders

139


139

110

104

104


107

79

79

Non-controlling interests

222


213

194

167

174


177

157

158












Balance sheet information

£bn


£bn

£bn

£bn

£bn


£bn

£bn

£bn

Total assets

1,203.8


1,213.1

1,324.0

1,351.3

1,248.9


1,120.0

1,236.5

1,196.7

Risk weighted assets

360.9


365.6

373.4

366.3

363.0


358.4

381.9

376.7

CRR leverage exposure

1,196.9


1,125.5

1,185.1

1,155.4

1,082.0


1,027.8

1,140.7

1,139.3












Performance measures











Return on average tangible shareholders' equity

1.8%


1.1%

3.6%

5.8%

3.8%


(20.1%)

3.6%

9.8%

Average tangible shareholders' equity (£bn)

49.4


48.9

49.4

48.3

48.3


47.8

47.6

47.2

Cost: income ratio

62%


87%

79%

65%

76%


128%

78%

69%

Loan loss rate (bps)

47


58

66

41

40


53

37

35

Basic earnings/(loss) per share 

1.3p


0.8p

2.6p

4.2p

2.7p


(14.4p)

2.6p

7.0p

Basic earnings/(loss) per share in respect of continuing operations

6.1p


1.1p

2.1p

3.8p

2.2p


(14.4p)

2.1p

6.4p

 

Barclays Core












Q117


Q416

Q316

Q216

Q116


Q415

Q315

Q215

Income statement information

£m


£m

£m

£m

£m


£m

£m

£m

Net interest income

2,508


2,577

2,718

2,491

2,591


2,555

2,557

2,510

Net fee, commission and other income

3,389


2,834

2,887

3,825

2,692


1,961

2,708

3,709

Total income

5,897


5,411

5,605

6,316

5,283


4,516

5,265

6,219

Credit impairment charges and other provisions

(524)


(606)

(769)

(462)

(414)


(522)

(388)

(373)

Net operating income

5,373


4,805

4,836

5,854

4,869


3,994

4,877

5,846

Operating expenses excluding UK bank levy and litigation and conduct

(3,443)


(3,471)

(3,270)

(3,057)

(3,258)


(2,992)

(3,094)

(3,061)

UK bank levy

-


(334)

-

-

-


(338)

-

-

Litigation and conduct

(19)


(46)

(639)

(420)

(12)


(1,634)

(419)

(819)

Operating expenses

(3,462)


(3,851)

(3,909)

(3,477)

(3,270)


(4,964)

(3,513)

(3,880)

Other net income/(expenses)

12


164

4

(18)

9


(5)

13

14

Profit/(loss) before tax

1,923


1,118

931

2,359

1,608


(975)

1,377

1,980

Tax charge

(548)


(272)

(522)

(696)

(485)


(92)

(299)

(474)

Profit/(loss) after tax

1,375


846

409

1,663

1,123


(1,067)

1,078

1,506

Non-controlling interests

(70)


(76)

(57)

(80)

(84)


(81)

(54)

(64)

Other equity holders

(121)


(121)

(95)

(89)

(89)


(92)

(63)

(61)

Attributable profit/(loss)

1,184


649

257

1,494

950


(1,240)

961

1,381












Balance sheet information

£bn


£bn

£bn

£bn

£bn


£bn

£bn

£bn

Total assets

954.7


933.4

964.3

972.2

883.6


794.2

862.0

830.5

Risk weighted assets

333.5


333.5

329.5

319.6

312.2


304.1

316.3

308.1












Performance measures











Return on average allocated tangible equity

11.0%


6.4%

2.7%

15.0%

9.9%


(12.8%)

10.4%

15.5%

Average allocated tangible equity (£bn)

44.2


42.4

41.8

40.4

39.3


38.1

37.5

35.9

Cost: income ratio

59%


71%

70%

55%

62%


110%

67%

62%

Loan loss rate (bps)

53


61

74

45

42


57

39

38

Basic earnings/(loss) per share contribution

7.2p


4.0p

1.7p

9.0p

5.8p


(7.3p)

5.8p

8.4p

 

Barclays Non-Core












Q117


Q416

Q316

Q216

Q116


Q415

Q315

Q215

Income statement information

£m


£m

£m

£m

£m


£m

£m

£m

Net interest income

11


(54)

78

40

96


171

135

154

Net trading income

(77)


(462)

(288)

(463)

(490)


(398)

(124)

(57)

(8)


97

51

79

152


159

204

146

Total income

(74)


(419)

(159)

(344)

(242)


(68)

215

243

Credit impairment charges and other provisions

(3)


(47)

(20)

(26)

(29)


(32)

(41)

(20)

Net operating (expenses)/income

(77)


(466)

(179)

(370)

(271)


(100)

174

223

Operating expenses excluding UK bank levy and litigation and conduct

(148)


(341)

(311)

(368)

(489)


(555)

(458)

(496)

UK bank levy

-


(76)

-

-

-


(88)

-

-

Litigation and conduct

(9)


(51)

(102)

(27)

(66)


(89)

(279)

(108)

Operating expenses

(157)


(468)

(413)

(395)

(555)


(732)

(737)

(604)

Other net (expenses)/income

(7)


146

498

(324)

11


(268)

(195)

(54)

Loss before tax

(241)


(788)

(94)

(1,089)

(815)


(1,100)

(758)

(435)

Tax credit/(charge)

75


322

194

229

237


(72)

166

150

(Loss)/profit after tax

(166)


(466)

100

(860)

(578)


(1,172)

(592)

(285)

Non-controlling interests

(9)


(14)

(13)

(12)

(10)


(19)

(21)

(21)

Other equity holders

(18)


(18)

(15)

(15)

(15)


(17)

(15)

(18)

Attributable (loss)/profit

(193)


(498)

72

(887)

(603)


(1,208)

(628)

(324)












Balance sheet information

£bn


£bn

£bn

£bn

£bn


£bn

£bn

£bn

Loans and advances to banks and customers at amortised cost

49.5


51.1

58.7

68.5

55.4


51.8

57.1

60.4

Derivative financial instrument assets

164.2


188.7

253.2

262.8

249.7


213.7

243.3

223.9

Derivative financial instrument liabilities

155.3


178.6

243.0

253.4

239.1


202.1

235.0

216.7

Reverse repurchase agreements and other similar secured lending

-


0.1

0.1

0.1

0.7


3.1

8.5

16.7

Financial assets designated at fair value

13.4


14.5

15.5

15.4

23.4


21.4

22.8

22.1

Total assets

249.1


279.7

359.8

379.1

365.4


325.8

374.5

366.2

Customer deposits

12.9


12.5

16.0

17.4

19.3


20.9

25.8

27.9

Risk weighted assets

27.4


32.1

43.9

46.7

50.9


54.3

65.6

68.6












Performance measures











Average allocated tangible equity (£bn)

5.2


6.5

7.6

7.9

9.0


9.7

10.2

11.3

Period end allocated tangible equity (£bn)

4.8


5.4

7.2

7.8

8.5


8.5

10.2

10.1

Loan loss rate (bps)

2


31

13

14

21


25

27

13

Basic (loss)/earnings per share contribution  

(1.1p)


(2.9p)

0.5p

(5.2p)

(3.6p)


(7.2p)

(3.7p)

(1.9p)












Analysis of total income

£m


£m

£m

£m

£m


£m

£m

£m

Businesses

51


(73)

181

181

196


229

314

292

Securities and loans

68


161

(34)

(363)

(402)


(195)

(87)

-

(193)


(507)

(306)

(162)

(36)


(102)

(12)

(49)

Total income

(74)


(419)

(159)

(344)

(242)


(68)

215

243

 

Quarterly Core Results by Business

 

Barclays UK












Q117


Q416

Q316

Q216

Q116


Q415

Q315

Q215

Income statement information

£m


£m

£m

£m

£m


£m

£m

£m

Net interest income

1,511


1,502

1,569

1,476

1,501


1,509

1,499

1,479

Net fee, commission and other income

330


326

374

467

302


325

375

325

Total income

1,841


1,828

1,943

1,943

1,803


1,834

1,874

1,804

Credit impairment charges and other provisions

(178)


(180)

(350)

(220)

(146)


(219)

(154)

(166)

Net operating income

1,663


1,648

1,593

1,723

1,657


1,615

1,720

1,638

Operating expenses excluding UK bank levy and litigation and conduct

(959)


(989)

(904)

(947)

(952)


(920)

(925)

(970)

UK bank levy

-


(48)

-

-

-


(77)

-

-

Litigation and conduct

4


(28)

(614)

(399)

(1)


(1,466)

(76)

(801)

Operating expenses

(955)


(1,065)

(1,518)

(1,346)

(953)


(2,463)

(1,001)

(1,771)

Other net (expenses)/income

-


-

-

(1)

-


1

1

1

Profit/(loss) before tax 

708


583

75

376

704


(847)

720

(132)

Attributable profit/(loss)

470


383

(163)

141

467


(1,078)

541

(174)












Balance sheet information

£bn


£bn

£bn

£bn

£bn


£bn

£bn

£bn

Loans and advances to customers at amortised cost

164.5


166.4

166.6

166.0

166.2


166.1

166.7

166.1

Total assets

203.0


209.6

209.1

204.6

201.7


202.5

204.1

202.2

Customer deposits

184.4


189.0

185.5

181.7

179.1


176.8

173.4

171.6

Risk weighted assets

66.3


67.5

67.4

67.1

69.7


69.5

71.0

71.7












Performance measures











Return on average allocated tangible equity

21.6%


18.2%

(7.1%)

6.6%

20.5%


(46.5%)

23.3%

(7.3%)

Average allocated tangible equity (£bn)

8.9


8.6

8.7

9.0

9.3


9.2

9.3

9.4

Cost: income ratio

52%


58%

78%

69%

53%


134%

53%

98%

Loan loss rate (bps)

43


42

82

52

34


51

36

40

Net interest margin

3.69%


3.56%

3.72%

3.56%

3.62%


3.58%

3.54%

3.54%

 

Analysis of Barclays UK












Q117


Q416

Q316

Q216

Q116


Q415

Q315

Q215

Analysis of total income

£m


£m

£m

£m

£m


£m

£m

£m

Personal Banking

944


934

970

1,068

919


945

938

905

Barclaycard Consumer UK

498


507

561

463

491


505

552

503

Wealth, Entrepreneurs & Business Banking

399


387

412

412

393


384

384

396

Total income

1,841


1,828

1,943

1,943

1,803


1,834

1,874

1,804












Analysis of credit impairment charges and other provisions











Personal Banking

(50)


(50)

(47)

(44)

(42)


(39)

(36)

(50)

Barclaycard Consumer UK

(123)


(118)

(291)

(169)

(105)


(176)

(111)

(106)

Wealth, Entrepreneurs & Business Banking

(5)


(12)

(12)

(7)

1


(4)

(7)

(10)

Total credit impairment charges and other provisions

(178)


(180)

(350)

(220)

(146)


(219)

(154)

(166)












Analysis of loans and advances to customers at amortised cost

£bn


£bn

£bn

£bn

£bn


£bn

£bn

£bn

Personal Banking

134.4


135.0

135.3

134.7

134.7


134.0

134.5

134.4

Barclaycard Consumer UK

16.1


16.5

16.2

16.2

16.0


16.2

15.9

15.8

Wealth, Entrepreneurs & Business Banking

14.0


14.9

15.1

15.1

15.5


15.9

16.3

15.9

Total loans and advances to customers at amortised cost

164.5


166.4

166.6

166.0

166.2


166.1

166.7

166.1












Analysis of customer deposits











Personal Banking

137.3


139.3

137.2

134.8

132.9


131.0

128.4

126.7

Barclaycard Consumer UK

-


-

-

-

-


-

-

-

Wealth, Entrepreneurs & Business Banking

47.1


49.7

48.3

46.9

46.2


45.8

45.0

44.9

Total customer deposits

184.4


189.0

185.5

181.7

179.1


176.8

173.4

171.6

 

Barclays International












Q117


Q416

Q316

Q216

Q116


Q415

Q315

Q215

Income statement information

£m


£m

£m

£m

£m


£m

£m

£m

Net interest income

1,112


1,046

1,355

1,001

1,110


1,121

1,109

1,077

Net trading income

1,182


1,131

1,074

1,130

1,245


593

817

1,299

Net fee, commission and other income

1,844


1,415

1,422

1,908

1,158


1,254

1,297

1,726

Total income

4,138


3,592

3,851

4,039

3,513


2,968

3,223

4,102

Credit impairment charges and other provisions

(346)


(426)

(420)

(240)

(269)


(303)

(235)

(206)

Net operating income

3,792


3,166

3,431

3,799

3,244


2,665

2,988

3,896

Operating expenses excluding UK bank levy and litigation and conduct

(2,435)


(2,497)

(2,337)

(2,074)

(2,221)


(2,007)

(2,059)

(2,027)

UK bank levy

-


(284)

-

-

-


(253)

-

-

Litigation and conduct

(13)


(17)

(17)

(10)

(4)


(151)

(302)

(12)

Operating expenses

(2,448)


(2,798)

(2,354)

(2,084)

(2,225)


(2,411)

(2,361)

(2,039)

Other net income

12


5

8

11

8


8

9

13

Profit before tax

1,356


373

1,085

1,726

1,027


262

636

1,870

Attributable profit/(loss)

837


43

623

1,171

575


(24)

422

1,376












Balance sheet information

£bn


£bn

£bn

£bn

£bn


£bn

£bn

£bn

Loans and advances to banks and customers at amortised cost

226.1


211.3

233.7

230.6

215.9


184.1

220.3

210.5

Trading portfolio assets

83.0


73.2

73.8

68.1

64.3


61.9

72.8

75.3

Derivative financial instrument assets

105.3


156.2

155.6

181.4

150.1


111.5

133.7

116.0

Derivative financial instrument liabilities

112.8


160.6

160.5

187.5

155.4


119.0

142.0

124.8

Reverse repurchase agreements and other similar secured lending

17.6


13.4

17.3

19.7

19.1


24.7

68.0

57.4

Financial assets designated at fair value

81.3


62.3

72.0

68.3

59.6


46.8

5.6

5.6

Total assets

677.2


648.5

681.9

679.9

618.4


532.2

596.1

566.1

Customer deposits

241.0


216.2

224.1

226.5

213.1


185.6

207.0

197.7

Risk weighted assets

214.3


212.7

214.6

209.3

202.2


194.8

204.0

195.4












Performance measures











Return on average allocated tangible equity

12.5%


1.0%

10.0%

19.2%

9.5%


(0.2%)

7.0%

22.5%

Average allocated tangible equity (£bn)

27.7


26.6

25.7

24.8

25.1


24.9

24.7

24.7

Cost: income ratio

59%


78%

61%

52%

63%


81%

73%

50%

Loan loss rate (bps)

62


78

71

41

50


65

42

38

Net interest margin

4.06%


3.91%

4.21%

3.92%

3.78%


3.79%

3.85%

3.86%

 

Analysis of Barclays International
















Corporate and Investment Bank

Q117


Q416

Q316

Q216

Q116


Q415

Q315

Q215

Income statement information

£m


£m

£m

£m

£m


£m

£m

£m

Analysis of total income











Credit

399


261

333

269

322


195

191

218

Equities

462


410

461

406

513


319

416

588

Macro

490


505

614

612

573


382

487

582

Markets

1,351


1,176

1,408

1,287

1,408


896

1,094

1,388

Banking fees

726


650

644

622

481


458

501

580

Corporate lending

269


303

284

312

296


312

377

387

Transactional banking

398


401

458

390

408


415

419

416

Banking

1,393


1,354

1,386

1,324

1,185


1,185

1,297

1,383

Other

38


1

1

-

3


16

(17)

495

Total income

2,782


2,531

2,795

2,611

2,596


2,097

2,374

3,266

Credit impairment charges and other provisions

(51)


(90)

(38)

(37)

(95)


(83)

(75)

(42)

Operating expenses

(1,941)


(2,287)

(1,872)

(1,665)

(1,800)


(1,962)

(1,940)

(1,605)

Profit before tax

790


155

885

909

701


52

358

1,620












Balance sheet information

£bn


£bn

£bn

£bn

£bn


£bn

£bn

£bn

Risk weighted assets

180.6


178.6

182.5

178.4

172.6


167.3

177.4

170.0












Performance measures











Return on average allocated tangible equity

8.2%


(1.2%)

9.2%

9.5%

7.3%


(2.5%)

4.5%

22.3%

Average allocated tangible equity (£bn)

23.5


22.6

21.9

21.3

21.6


21.8

21.7

21.7












Consumer, Cards and Payments











Income statement information

£m


£m

£m

£m

£m


£m

£m

£m

Total income

1,356


1,061

1,056

1,428

917


871

849

836

Credit impairment charges and other provisions

(295)


(336)

(382)

(203)

(174)


(219)

(160)

(165)

Operating expenses

(507)


(511)

(482)

(419)

(425)


(449)

(421)

(434)

Profit before tax

566


218

200

817

326


210

278

250












Balance sheet information

£bn


£bn

£bn

£bn

£bn


£bn

£bn

£bn

Loans and advances to banks and customers at amortised cost

38.7


39.7

36.8

35.4

32.9


32.1

30.6

29.6

Customer deposits

57.6


50.0

48.3

46.9

44.2


41.8

39.8

38.4

Risk weighted assets

33.7


34.1

32.1

30.9

29.6


27.5

26.6

25.4












Performance measures











Return on average allocated tangible equity

36.4%


13.2%

14.8%

77.9%

23.4%


15.3%

24.7%

23.4%

Average allocated tangible equity (£bn)

4.2


4.0

3.7

3.5

3.4


3.2

3.1

3.0

 

Head Office












Q117


Q416

Q316

Q216

Q116


Q415

Q315

Q215

Income statement information

£m


£m

£m

£m

£m


£m

£m

£m

Net interest income

(115)


29

(206)

14

(20)


(75)

(51)

(46)

Net fee, commission and other income1

33


(38)

17

320

(13)


(210)

220

358

Total income

(82)


(9)

(189)

334

(33)


(285)

169

312

Credit impairment releases/(charges) and other provisions 

-


-

1

(2)

1


-

1

(1)

Net operating (expenses)/income

(82)


(9)

(188)

332

(32)


(285)

170

311

Operating expenses excluding UK bank levy and litigation and conduct

(49)


15

(29)

(36)

(85)


(64)

(110)

(64)

UK bank levy

-


(2)

-

-

-


(8)

-

-

Litigation and conduct

(10)


(1)

(8)

(11)

(7)


(17)

(42)

(6)

Operating expenses

(59)


12

(37)

(47)

(92)


(89)

(152)

(70)

Other net income/(expenses)

-


159

(4)

(28)

1


(14)

2

1

(Loss)/profit before tax

(141)


162

(229)

257

(123)


(388)

20

242

Attributable (loss)/profit

(123)


223

(203)

182

(92)


(140)

(1)

180












Balance sheet information

£bn


£bn

£bn

£bn

£bn


£bn

£bn

£bn

Total assets2

74.5


75.2

73.3

87.7

63.4


59.4

61.8

62.2

Risk weighted assets2

52.9


53.3

47.5

43.2

40.3


39.7

41.3

41.0












Performance measures











Average allocated tangible equity (£bn)

7.6


7.2

7.4

6.6

5.0


3.9

3.4

1.8

 

1

Following the early adoption of the own credit provisions of IFRS 9 on 1 January 2017, own credit, which was previously reported in net fee, commission and other income is now recognised within other comprehensive income from Q117.

2

Includes Africa Banking assets and RWAs.

 

Discontinued Quarterly Results

 

On 1 March 2016, Barclays announced its intention to reduce the Group's interest in BAGL. The BAGL disposal group includes all assets and liabilities of BAGL and its subsidiaries, as well as Group balances associated with BAGL and expected contributions that form part of the sale.

Per IFRS 5, impairment is calculated as the difference between the fair value less disposal costs and the carrying value of the disposal group. The fair value is determined by referencing the quoted market price for BAGL and the foreign exchange rate for ZAR/GBP as at 31 March 2017. The carrying value of the disposal group as at 31 March 2017, including internal balances and after considering expected contributions of £827m1 in respect of BAGL, was £8.1bn. As the fair value less disposal costs was less than the carrying value at 31 March 2017, an impairment of £884m was recognised, taken against goodwill.

The Group's CET1 capital was unaffected by the impairment as at 31 March 2017 as CET1 capital excludes goodwill and other intangible assets. At 31 March 2017, £42m of acquisition goodwill remained on Barclays' balance sheet with regard to its interest in BAGL.

Africa Banking profit before tax, excluding the impairment of Barclays' holding in BAGL, increased to £325m (Q116: £231m) mainly reflecting the appreciation of average ZAR against GBP.

Currency translation reserve (CTR) losses have accumulated in relation to Barclays' holding in BAGL due to the depreciation of ZAR against GBP since July 2005. The current CTR balance of c.£1.2bn will be recycled through the income statement upon accounting deconsolidation. The impact of the accumulated CTR balance is already included within CET1 capital and TNAV.

 

1

In December 2016, Barclays finalised proposals regarding planned contributions to the BAGL group relating to the reimbursement of certain expenses as well as contributions for investment to support separation activities. The cash and cash equivalents to make these planned contributions are included within the perimeter of the disposal group for the purposes of measuring the disposal group at the lower of carrying amount and fair value less costs to sell. The planned contributions are reported within cash and balances at central banks in the Group's consolidated balance sheet.

 

Africa Banking












Q117


Q416

Q316

Q216

Q116


Q415

Q315

Q215

Income statement information

£m


£m

£m

£m

£m


£m

£m

£m

Net interest income

617


626

561

502

480


468

471

506

Net fee, commission and other income

465


441

421

377

338


346

351

364

Total income

1,082


1,067

982

879

818


814

822

870

Credit impairment charges and other provisions

(106)


(105)

(96)

(133)

(111)


(93)

(66)

(103)

Net operating income

976


962

886

746

707


721

756

767

Operating expenses excluding UK bank levy and impairment of goodwill

(653)


(727)

(598)

(543)

(477)


(501)

(515)

(536)

UK bank levy

-


(65)

-

-

-


(50)

-

-

Impairment of Barclays' holding in BAGL

(884)


-

-

-

-


-

-

-

Operating expenses

(1,537)


(792)

(598)

(543)

(477)


(551)

(515)

(536)

Other net income

2


2

2

1

1


3

1

1

(Loss)/profit before tax

(559)


172

290

204

231


173

242

232

Profit before tax excluding impairment of Barclays' holding in BAGL

325


172

290

204

231


173

242

232

(Loss)/profit after tax

(658)


71

209

145

166


101

167

162

Attributable (loss)/profit

(801)


(52)

85

70

86


25

85

88












Balance sheet information

£bn


£bn

£bn

£bn

£bn


£bn

£bn

£bn

Total assets1

66.0


65.1

61.1

56.0

52.7


47.9

50.2

52.2

Risk weighted assets1

41.3


42.3

39.9

36.1

33.9


31.7

33.8

34.4

 

 

1

Africa Banking (excluding Egypt and Zimbabwe) assets and RWAs are reported in Head Office within Core.

 

Performance Management

 

Margins and balances








Three months ended 31.03.17

Three months ended 31.03.16


Net interest income

Average customer assets

Net interest margin

Net interest income

Average customer assets

Net interest margin


£m

£m

%

£m

£m

%

Barclays UK

1,511

166,065

3.69

1,501

166,727

3.62

Barclays International1

1,121

112,060

4.06

995

105,994

3.78

Total Barclays UK and Barclays International

2,632

278,125

3.84

2,496

272,721

3.68

Other2

(113)



192



Total net interest income

2,519



2,688



 

 

1

Barclays International margins include interest earning lending balances within the investment banking business.

2

Other includes Head Office, Barclays Non-Core and non-lending related investment banking balances.

 



Quarterly analysis for Barclays UK and Barclays International

Three months ended 31.12.16


Net interest income

Average customer assets

Net interest margin


£m

£m

%

Barclays UK

1,502

167,935

3.56

Barclays International1

1,110

112,936

3.91

Total Barclays UK and Barclays International

2,612

280,871

3.70






Three months ended 30.09.16

Barclays UK

1,569

167,713

3.72

Barclays International1

1,149

108,571

4.21

Total Barclays UK and Barclays International

2,718

276,284

3.91






Three months ended 30.06.16

Barclays UK

1,476

166,891

3.56

Barclays International1

1,021

104,707

3.92

Total Barclays UK and Barclays International

2,497

271,598

3.70






Three months ended 31.03.16

Barclays UK

1,501

166,727

3.62

Barclays International1

995

105,994

3.78

Total Barclays UK and Barclays International

2,496

272,721

3.68

 

 

1

Barclays International margins include interest earning lending balances within the investment banking business.

 

Credit Risk

 

Analysis of retail and wholesale loans and advances and impairment

 



Gross

loans and advances

Impairment allowance

Loans and advances     net of impairment

Credit

risk loans

CRLs % of gross loans and advances

Loan impairment charges1

Loan loss rates

As at 31.03.17

£m

£m

£m

£m

%

£m

bps

Barclays UK

154,551

1,550

153,001

1,949

1.3

173

45

Barclays International

30,902

1,476

29,426

1,228

4.0

298

391

Barclays Core

185,453

3,026

182,427

3,177

1.7

471

103

Barclays Non-Core

10,088

389

9,699

825

8.2

10

40

Total Group retail

195,541

3,415

192,126

4,002

2.0

481

100









Barclays UK

14,220

299

13,921

603

4.2

5

14

Barclays International

197,403

773

196,630

1,329

0.7

49

10

Head Office

5,079

-

5,079

-

-

-

-

Barclays Core

216,702

1,072

215,630

1,932

0.9

54

10

Barclays Non-Core

39,932

163

39,769

274

0.7

(8)

(8)

Total Group wholesale

256,634

1,235

255,399

2,206

0.9

46

7









Total loans and advances at amortised cost

452,175

4,650

447,525

6,208

1.4

527

47









Traded loans

5,310

n/a

5,310

n/a




Loans and advances designated at fair value

13,259

n/a

13,259

n/a




Loans and advances held at fair value

18,569

n/a

18,569

n/a












Total loans and advances

470,744

4,650

466,094

6,208












As at 31.12.16








Barclays UK

155,729

1,519

154,210

2,044

1.3

866

56

Barclays International

33,485

1,492

31,993

1,249

3.7

1,085

324

Barclays Core

189,214

3,011

186,203

3,293

1.7

1,951

103

Barclays Non-Core

10,319

385

9,934

838

8.1

102

99

Total Group retail

199,533

3,396

196,137

4,131

2.1

2,053

103









Barclays UK

15,204

282

14,922

591

3.9

30

20

Barclays International

180,102

748

179,354

1,470

0.8

258

14

Head Office

4,410

-

4,410

-

-

-

-

Barclays Core

199,716

1,030

198,686

2,061

1.0

288

14

Barclays Non-Core

41,406

194

41,212

299

0.7

11

3

Total Group wholesale

241,122

1,224

239,898

2,360

1.0

299

12









Total loans and advances at amortised cost

440,655

4,620

436,035

6,491

1.5

2,352

53









Traded loans

2,975

n/a

2,975

n/a




Loans and advances designated at fair value

10,519

n/a

10,519

n/a




Loans and advances held at fair value

13,494

n/a

13,494

n/a












Total loans and advances

454,149

4,620

449,529

6,491




 

 

1

Excludes impairment charges on available for sale investments and reverse repurchase agreements. Q117 impairment charges represent 3 months charge, whereas December 2016 impairment charges represent 12 months charge.

 

Total loans and advances increased £16.6bn to £470.7bn driven by an increase in net settlement and cash collateral balances.

Credit risk loans (CRLs) and the ratio of CRLs to gross loans and advances decreased £0.3bn to £6.2bn and 0.1% to 1.4% respectively.

Loan loss rate decreased 6bps to 47bps.

 

Consolidated Summary Financial Statements

 

Consolidated summary income statement


Three months ended

Three months ended


31.03.17

31.03.16


£m

£m

Total income net of insurance claims

5,823

5,041

Credit impairment charges and other provisions

(527)

(443)

Net operating income

5,296

4,598

Operating expenses excluding litigation and conduct

(3,591)

(3,747)

Litigation and conduct

(28)

(78)

Operating expenses

(3,619)

(3,825)

Other net income

5

20

Profit before tax

1,682

793

Tax charge

(473)

(248)

Profit after tax in respect of continuing operations

1,209

545

(Loss)/profit after tax in respect of discontinued operation

(658)

166

Profit after tax

551

711




Attributable to:



Ordinary equity holders of the parent

190

433

Other equity holders

139

104

Total equity holders

329

537

Non-controlling interests in respect of continuing operations

79

94

Non-controlling interests in respect of discontinued operation

143

80

Profit after tax

551

711




Earnings per share



Basic earnings per ordinary share1

1.3p

2.7p

Basic earnings per ordinary share in respect of continuing operations

6.1p

2.2p

Basic (loss)/earnings per ordinary share in respect of discontinued operation

(4.8p)

0.5p

 

1

The profit after tax attributable to other equity holders of £139m (Q116: £104m) is offset by a tax credit recorded in reserves of £38m (Q116: £29m). The net amount of £101m (Q116: £75m), along with non-controlling interests (NCI) is deducted from profit after tax in order to calculate earnings per share and return on average tangible shareholders' equity.

 

Consolidated summary balance sheet




As at

As at


31.03.17

31.12.16

Assets

£m

£m

Cash and balances at central banks

130,287

102,353

Items in the course of collection from other banks

1,357

1,467

Trading portfolio assets

90,370

80,240

Financial assets designated at fair value

95,895

78,608

Derivative financial instruments

270,820

346,626

Financial investments

57,763

63,317

Loans and advances to banks

42,232

43,251

Loans and advances to customers

405,293

392,784

Reverse repurchase agreements and other similar secured lending

17,653

13,454

Goodwill and intangible assets

7,689

7,726

Assets included in disposal groups classified as held for sale

71,211

71,454

Other assets

13,221

11,846

Total assets

1,203,791

1,213,126




Liabilities



Deposits from banks

50,392

48,214

Items in the course of collection due to other banks

975

636

Customer accounts

450,623

423,178

Repurchase agreements and other similar secured borrowing

30,500

19,760

Trading portfolio liabilities

36,122

34,687

Financial liabilities designated at fair value

112,230

96,031

Derivative financial instruments

268,899

340,487

Debt securities in issue

79,558

75,932

Subordinated liabilities

23,243

23,383

Liabilities included in disposal groups classified as held for sale

68,081

65,292

Other liabilities

11,802

14,161

Total liabilities

1,132,425

1,141,761




Equity



Called up share capital and share premium

21,877

21,842

Other reserves

5,597

6,051

Retained earnings

30,372

30,531

Shareholders' equity attributable to ordinary shareholders of the parent

57,846

58,424

Other equity instruments

7,690

6,449

Total equity excluding non-controlling interests

65,536

64,873

Non-controlling interests

5,830

6,492

Total equity

71,366

71,365




Total liabilities and equity

1,203,791

1,213,126

 

 

Consolidated summary statement of changes in equity










Called up share capital and share premium

Other equity instruments

Other reserves2

Retained earnings

Total

Non-controlling interests

Total

equity

Three months ended 31.03.17

£m

£m

£m

£m

£m

£m

£m

Balance as at 31 December 2016

21,842

6,449

6,051

30,531

64,873

6,492

71,365

Effects of changes in accounting policies1

-

-

(175)

175

-

-

-

Balance as at 1 January 2017

21,842

6,449

5,876

30,706

64,873

6,492

71,365

Profit after tax

-

139

-

991

1,130

79

1,209

Other comprehensive income for the period

-

-

(262)

387

125

-

125

Total comprehensive income net of tax from continuing operations

-

139

(262)

1,378

1,255

79

1,334

Total comprehensive income net of tax from discontinued operation

-

-

(19)

(801)

(820)

159

(661)

Total comprehensive income for the period

-

139

(281)

577

435

238

673

Issue and exchange of equity instruments

35

1,245

-

138

1,418

-

1,418

Coupons paid on other equity instruments

-

(139)

-

38

(101)

-

(101)

Redemption and buy back of capital instruments

-

-

-

(473)

(473)

(657)

(1,130)

Purchase of treasury shares

-

-

(296)

-

(296)

-

(296)

Vesting of employee share schemes

-

-

298

(610)

(312)

-

(312)

Dividends paid

-

-

-

-

-

(229)

(229)

Other movements

-

(4)

-

(4)

(8)

(14)

(22)

Balance as at 31 March 2017

21,877

7,690

5,597

30,372

65,536

5,830

71,366

 

 

 

 

1

As a result of the early adoption of the own credit provisions of IFRS 9 on 1 January 2017, own credit which was previously recorded in the income statement is now recognised within other comprehensive income. The cumulative unrealised own credit net loss of £175m has therefore been reclassified from retained earnings to a separate own credit reserve, within Other reserves. During Q117 a £44m gain on own credit has been booked in the reserve.

2

Other reserves includes currency translation reserve of £2,809m (December 2016: £3,051m), available for sale investments of £9m debit (December 2016: £74m debit), cash flow hedge reserve of £1,957m (December 2016: £2,105m), own credit reserve of £131m debit (December 2016: n/a) and other reserves and treasury shares of £971m (December 2016: £969m).

 

Barclays PLC Parent Company Balance Sheet

 

Barclays PLC Parent Company summary balance sheet


As at

As at


31.03.17

31.12.16

Assets

£m

£m

Investments in subsidiary

37,803

36,553

Loans and advances to subsidiary

24,134

19,421

Financial investments

1,274

1,218

Derivative financial instrument

284

268

Other assets

118

105

Total assets

63,613

57,565




Liabilities



Deposits from banks

541

547

Subordinated liabilities

3,760

3,789

Debt securities in issue

21,626

16,893

Other liabilities

26

14

Total liabilities

25,953

21,243




Equity



Called up share capital

4,245

4,241

Share premium account

17,632

17,601

Other equity instruments

7,698

6,453

Other reserves

474

420

Retained earnings

7,611

7,607

Total shareholders' equity

37,660

36,322

Total liabilities and shareholders' equity

63,613

57,565

 

 

Investment in subsidiary

The investment in subsidiary of £37,803m (December 2016: £36,553m) represents investments made into Barclays Bank PLC, including £7,736m (December 2016: £6,486m) of Additional Tier 1 (AT1) securities. The increase of £1,250m was driven by a £1,250m AT1 issuance by Barclays Bank PLC during the first quarter.

 

Loans and advances to subsidiary, subordinated liabilities and debt securities in issue

For the three months ended March 2017, Barclays PLC issued $5.0bn of Fixed and Floating Rate Senior Notes and £0.95bn of Fixed Rate Senior Notes included within the debt securities in issue balance of £21,626m (2016: £16,893m). The proceeds raised through these transactions were used to invest in Barclays Bank PLC in each case with a ranking corresponding to the notes issued by Barclays PLC and included within the loans and advances to subsidiary balance of £24,134m (2016: £19,421m).

 

Management of internal investments, loans and advances

Barclays PLC retains the discretion to manage the nature of its internal investments in subsidiaries according to their regulatory and business needs. As we implement our structural reform programme, Barclays PLC will invest capital and funding to Barclays Bank PLC and other Group subsidiaries such as the Group service company, the US IHC and the UK ring-fenced bank.


 

Capital

 

CRD IV capital

Barclays' current regulatory requirement is to meet a fully loaded CRD IV CET1 ratio comprising the required 4.5% minimum CET1 ratio and, phased in from 2016, a Combined Buffer Requirement. This currently comprises a Capital Conservation Buffer (CCB) of 2.5% and a Global Systemically Important Institution (G-SII) buffer determined by the PRA in line with guidance from the Financial Stability Board (FSB). Both buffers are subject to phased implementation, the CCB is phased in at 25% per annum with 1.25% applicable for 2017. The G-SII buffer for 2017 has been set at 2% and is also phased in at 25% per annum from 2016 with 1% applicable for 2017. On 21 November 2016 the FSB confirmed that the G-SII buffer for 2018 will be 1.5% with 1.1% applicable for 2018 and taking full effect from 2019 onwards.

 

Also forming part of the Combined Buffer Requirement is a Counter-Cyclical Buffer (CCyB) and a Systemic Risk Buffer (SRB). On 27 March 2017 the Financial Policy Committee (FPC) reaffirmed that it expects to maintain a CCyB of 0% on UK exposures until at least June 2017. Other national authorities also determine the appropriate CCyBs that should be applied to exposures in their jurisdiction. CCyBs have started to apply for Barclays' exposures to other jurisdictions; however based on current exposures these are not material. No SRB has been set to date.

 

In addition, Barclays' Pillar 2A requirement as per the PRA's Individual Capital Guidance (ICG) for 2017 based on a point in time assessment is 4.0% of which 56% needs to be met in CET1 form, equating to approximately 2.3% of RWAs. The Pillar 2A requirement is subject to at least annual review.

 

As at 31 March 2017 Barclays' CET1 ratio was 12.5% which exceeds the 2017 transitional minimum requirement of 9.0% including the minimum 4.5% CET1 ratio requirement, 2.3% of Pillar 2A, a 1.25% CCB buffer, a 1% G-SII buffer and a 0% CCyB. 

 

All capital, RWA and leverage calculations reflect Barclays' interpretation of the current rules.

 

 

Capital ratios

As at

As at

31.03.17

31.12.16

Fully loaded CET11,2

12.5%

12.4%

PRA Transitional Tier 13,4

15.8%

15.6%

PRA Transitional Total Capital3,4

19.6%

19.6%

  



Capital resources

£m

£m

Shareholders' equity (excluding non-controlling interests) per the balance sheet

65,536

64,873

Less: other equity instruments (recognised as AT1 capital)

(7,690)

(6,449)

Adjustment to retained earnings for foreseeable dividends

(519)

(388)

Minority interests (amount allowed in consolidated CET1)

1,864

1,825




Other regulatory adjustments and deductions:



Additional value adjustments (PVA)

(1,618)

(1,571)

Goodwill and intangible assets

(8,142)

(9,054)

Deferred tax assets that rely on future profitability excluding temporary differences

(421)

(494)

Fair value reserves related to gains or losses on cash flow hedges

(1,956)

(2,104)

Excess of expected losses over impairment

(1,286)

(1,294)

Gains or losses on liabilities at fair value resulting from own credit

(28)

86

Defined-benefit pension fund assets

(753)

(38)

Direct and indirect holdings by an institution of own CET1 instruments

(50)

(50)

Deferred tax assets arising from temporary differences (amount above 10% threshold)

(39)

(183)

Other regulatory adjustments

40

45

Fully loaded CET1 capital

44,938

45,204

  



Additional Tier 1 (AT1) capital



Capital instruments and related share premium accounts

7,690

6,449

Qualifying AT1 capital (including minority interests) issued by subsidiaries

4,576

5,445

Other regulatory adjustments and deductions

(131)

(130)

Transitional AT1 capital5

12,135

11,764

PRA Transitional Tier 1 capital

57,073

56,968

  



Tier 2 (T2) capital



Capital instruments and related share premium accounts

3,724

3,769

Qualifying T2 capital (including minority interests) issued by subsidiaries

10,153

11,366

Other regulatory adjustments and deductions

(257)

(257)

PRA Transitional total regulatory capital

70,693

71,846

 

 

 

1

The transitional regulatory adjustments to CET1 capital are no longer applicable resulting in CET1 capital on a fully loaded basis being equal to that on a transitional basis.

2

The CRD IV CET1 ratio (FSA October 2012 transitional statement) as applicable to Barclays' Tier 2 Contingent Capital Notes was 13.1% based on £47.1bn of transitional CRD IV CET1 capital and £361bn of RWAs.

3

The PRA transitional capital is based on the PRA Rulebook and accompanying supervisory statements.

4

As at 31 March 2017, Barclays' fully loaded Tier 1 capital was £52,961m, and the fully loaded Tier 1 ratio was 14.7%. Fully loaded total regulatory capital was £67,364m and the fully loaded total capital ratio was 18.7%. The fully loaded Tier 1 capital and total capital measures are calculated without applying the transitional provisions set out in CRD IV and assessing compliance of AT1 and T2 instruments against the relevant criteria in CRD IV.

5

Of the £12.1bn transitional AT1 capital, fully loaded AT1 capital used for the leverage ratio comprises the £7.7bn capital instruments and related share premium accounts, £0.5bn qualifying minority interests and £0.1bn capital deductions. It excludes legacy Tier 1 capital instruments issued by subsidiaries that are subject to grandfathering.

 

Movement in CET1 capital

Three months

ended

31.03.17

£m

Opening CET1 capital

45,204



Profit for the period attributable to equity holders

329

Own credit relating to derivative liabilities

15

Dividends paid and foreseen

(232)

Increase in retained regulatory capital generated from earnings

112



Net impact of share schemes

(435)

Available for sale reserves

65

Currency translation reserves

(242)

Other reserves

(562)

Decrease in other qualifying reserves

(1,174)



Retirement benefit reserve

387

Defined-benefit pension fund asset deduction

(715)

Net impact of pensions

(328)



Minority interests

39

Additional value adjustments (PVA)

(47)

Goodwill and intangible assets

912

Deferred tax assets that rely on future profitability excluding those arising from temporary differences

73

Excess of expected loss over impairment

8

Deferred tax assets arising from temporary differences (amount above 10% threshold)

144

Other regulatory adjustments

(5)

Increase in regulatory capital due to adjustments and deductions

1,124



Closing CET1 capital

44,938

 

•

The fully loaded CRD IV CET1 ratio increased to 12.5% (December 2016: 12.4%) primarily driven by a reduction in RWAs of £4.8bn to £360.9bn, whilst CET1 capital decreased £0.3bn to £44.9bn

•

Profit after tax in respect of continuing operations was offset by losses in respect of the discontinued operation primarily driven by the impairment of Barclays' holding in BAGL allocated to acquisition goodwill. The impairment had no impact on CET1 capital as the losses were offset by a £0.9bn decrease in the goodwill and intangible assets deduction. Other significant movements in the period were:


-

A £1.2bn decrease in other qualifying reserves which included a £0.5bn decrease as a result of USD preference share redemptions, and a £0.4bn impact related to share schemes due to the purchase of shares for employee share awards


-

A £0.3bn decrease net of tax as a result of movements relating to pensions, largely due to contributions of £477m made in the quarter

•

Transitional AT1 capital increased by £0.4bn as an issuance of £1.25bn of qualifying AT1 capital was partially offset by redemptions of $1.375bn 7.1% Series 3 USD preference shares

 

 

 

Risk weighted assets (RWAs) by risk type and business

 


Credit risk


Counterparty credit risk



Market risk


Operational risk

Total RWAs


Std

IRB


Std

IRB

Settle-ment Risk

CVA


Std

IMA




As at 31.03.17

£m

£m


£m

£m

£m

£m


£m

£m


£m

£m

Barclays UK

4,629

49,330


-

-

1

43


-

-


12,338

66,341

Barclays International

50,609

83,643


15,942

14,007

77

2,251


10,481

9,716


27,538

214,264

Head Office1

9,182

25,660


99

1,040

-

851


567

2,716


12,746

52,861

Barclays Core

64,420

158,633


16,041

15,047

78

3,145


11,048

12,432


52,622

333,466

Barclays Non-Core

4,036

9,396


1,034

5,106

-

638


337

2,827


4,038

27,412

Barclays Group

68,456

168,029


17,075

20,153

78

3,783


11,385

15,259


56,660

360,878















As at 31.12.16








Barclays UK

5,592

49,591


47

               - 

               - 

                 -


               - 

               - 


12,293

67,523

Barclays International

53,201

82,327


13,515

13,706

30

3,581


9,343

9,460


27,538

212,701

Head Office1

9,048

27,122


77

1,157

               - 

927


482

2,323


12,156

53,292

Barclays Core

67,841

159,040


13,639

14,863

30

4,508


9,825

11,783


51,987

333,516

Barclays Non-Core

4,714

9,945


1,043

6,081

37

2,235


477

2,928


4,673

32,133

Barclays Group

72,555

168,985


14,682

20,944

67

6,743


10,302

14,711


56,660

365,649

 

1

Includes Africa Banking discontinued operation.

 

Movement analysis of risk weighted assets

 


Credit risk

Counterparty credit risk

Market risk

Operational risk

Total RWAs


£bn

£bn

£bn

£bn

£bn

As at 01.01.17

241.5

42.4

25.0

56.7

365.6

Book size

(1.7)

(0.9)

1.8

-

(0.8)

Acquisitions and disposals

(1.5)

-

-

-

(1.5)

Book quality

(0.3)

0.1

-

-

(0.2)

Model updates

(1.4)

-

-

-

(1.4)

Methodology and policy

0.3

(0.5)

(0.2)

-

(0.4)

Foreign exchange movements1

(0.4)

-

-

-

(0.4)

As at 31.03.17

236.5

41.1

26.6

56.7

360.9

 

1

Foreign exchange movement does not include FX for counterparty risk or market risk.

 

RWAs decreased £4.8bn to £360.9bn due to:

 

•

Acquisitions and disposals decreased RWAs £1.5bn primarily relating to an asset sale in US cards as well as reflecting the run-down of portfolios and business disposals in Non-Core

•

Model updates decreased RWAs £1.4bn primarily due to model changes in the Africa Banking discontinued operation

 

Leverage ratio and exposures

 

Barclays is required to disclose the UK leverage ratio and the CRR leverage ratio:

 

•

The UK leverage ratio uses capital and exposure measures based on the average of the last day of each month in the quarter; additionally, the average exposure measure excludes qualifying central bank claims. The minimum requirement is on a phased basis which results in a transitional requirement of 3.4% as at 31 March 2017; this comprises of the 3% minimum requirement, a transitional G-SII additional leverage ratio buffer (G-SII ALRB) and a countercyclical leverage ratio buffer (CCLB). The expected end point minimum requirement is 3.5%

•

The CRR leverage ratio uses the end point CRR definition of Tier 1 capital and the CRR definition of leverage exposure.  The current expected minimum fully loaded requirement is 3%, although this may be impacted by the Basel Consultation on the Leverage Framework

 

At 31 March 2017, the average UK leverage ratio was 4.6% (December 2016: 4.5%)1 which exceeds the transitional minimum requirement of 3.4% and expected end point minimum requirement of 3.5%, and the CRR leverage ratio was 4.4% (December 2016: 4.6%).  

 

 

As at 31.03.17

As at 31.12.16

UK leverage ratio

£bn

£bn

UK Leverage exposure (quarterly month end average)

1,130

1,137

Fully loaded Tier 1 capital (quarterly month end average)

52.3

51.6




UK leverage ratio (quarterly month end average)

4.6%

4.5%

 

 

 

 

 

 

 

 

CRR leverage ratio



Accounting assets



Derivative financial instruments

                         271

347

Cash collateral

                          60

67

Reverse repurchase agreements and other similar secured lending

                          18

13

Financial assets designated at fair value1

                         96

79

Loans and advances and other assets

                        759

707

Total IFRS assets

                     1,204

1,213




Regulatory consolidation adjustments

                          (4)

(6)




Derivatives adjustments



Derivatives netting

 (244)

(313)

Adjustments to cash collateral

(51)

(50)

Net written credit protection

13

12

Potential Future Exposure (PFE) on derivatives

137

136

Total derivatives adjustments

(145)

(215)




Securities financing transactions (SFTs) adjustments

35

29




Regulatory deductions and other adjustments

(14)

(15)

Weighted off-balance sheet commitments

                        121

119

CRR leverage exposure

1,197

1,125




Fully loaded CET 1 capital

44.9

45.2

Fully loaded AT1 capital

8.0

6.8

Fully loaded Tier 1 capital

53.0

52.0




CRR leverage ratio

4.4%

4.6%

 

1

Included within financial assets designated at fair value are reverse repurchase agreements designated at fair value of £76bn (December 2016: £63bn).

 

The average UK leverage exposure as at 31 March 2017, which excludes qualifying central bank claims, was £1,130bn (December 2016: £1,137bn), resulting in an average UK leverage ratio of 4.6% (December 2016: 4.5%). The CET1 capital held against the 0.35% transitional G-SII ALRB was £4.2bn. The impact of the CCLB is currently nil. 

The CRR leverage ratio decreased to 4.4% (December 2016: 4.6%) primarily driven by an increase in the CRR leverage exposure of £72bn to £1,197bn (December 2016: £1,125bn), partially offset by a £1.0bn increase in fully loaded Tier 1 capital to £53.0bn (December 2016: £52.0bn):

 

•

Loans and advances and other assets increased by £52bn to £759bn. This was driven by a £28bn increase in cash and balances at central banks mainly due to an increase in the cash contribution to the Group liquidity pool, and a £25bn increase in settlement balances


•

Reverse repurchase agreements increased £18bn to £94bn, primarily due to an increase in matched book trading


•

Net derivative leverage exposures, excluding net written credit protection and PFE on derivatives, decreased £15bn to £36bn due to a decrease in cash collateral and a reduction in IFRS derivatives due to decreases in foreign exchange derivatives, interest rate derivatives and continued run down of Non-Core assets

 

The difference between the average UK leverage ratio and the CRR leverage ratio was primarily driven by the exemption of qualifying central bank claims partially offset by higher positions for January and February within trading portfolio assets and settlement balances.

 

Group MREL requirements

In Q117 the Bank of England (BoE) communicated to Barclays the non-binding indicative minimum requirements for own funds and eligible liabilities (MREL) at the consolidated Barclays group level for 2019 to 2022. On the basis of the approach set out in the BoE's Statement of Policy issued in November 2016, the BoE have communicated indicative MREL requirements, prior to the application of any applicable regulatory buffer, as being the higher of:

 

•

6% of leverage exposure and 16% of RWAs from 1 January 2019;


•

6% of leverage exposure and 20% of RWAs from 1 January 2020; and


•

6.75% of leverage exposure and 24% of RWAs from 1 January 2022.

 

These non-binding indicative MREL requirements remain subject to change at the conclusion of the transitional period, as determined by the BoE, taking into account a number of factors as described in the Statement of Policy.

 


 

Appendix: Non-IFRS performance measures

 

The Barclays management believes that the non-IFRS performance measures included in this document provide valuable information to the readers of the financial statements as they enable the reader to identify a more consistent basis for comparing the business' performance between financial periods, and provide more detail concerning the elements of performance which the managers of these businesses are most directly able to influence or are relevant for an assessment of Barclays PLC and its subsidiaries (the Group). They also reflect an important aspect of the way in which operating targets are defined and performance is monitored by Barclays' management.

Any non-IFRS performance measures in this document are not a substitute for IFRS measures and readers should consider the IFRS measures as well.

 

Non-IFRS performance measures glossary

 

Measure

Definition

Barclays Core

Barclays Core includes Barclays UK, Barclays International and Head Office. A reconciliation of Core statutory results is included on page 31.

 

Return on average tangible shareholders' equity

 

Annualised statutory profit after tax attributable to ordinary equity holders of the parent, including an adjustment for the tax credit in reserves in respect of other equity instruments, as a proportion of average shareholders' equity excluding non-controlling interests and other equity instruments adjusted for the deduction of intangible assets and goodwill. The components of the calculation have been included on pages 32-33.

 

Return on average allocated tangible equity

 

Annualised statutory profit after tax attributable to ordinary equity holders of the parent, including an adjustment for the tax credit in reserves in respect of other equity instruments, as a proportion of average allocated tangible equity. The components of the calculation have been included on pages 32-33.

 

Period end allocated tangible equity

Allocated tangible equity is calculated as 12.0% (2016: 11.5%) of CRD IV fully loaded risk weighted assets for each business, adjusted for CRD IV fully loaded capital deductions, excluding goodwill and intangible assets, reflecting the assumptions the Group uses for capital planning purposes. Head Office tangible equity represents the difference between the Group's tangible equity and the amounts allocated to businesses.

 

Average tangible shareholders' equity

Calculated as the average of the previous month's period end tangible equity and the current month's period end tangible equity. The average tangible shareholders' equity for the quarter/year is the average of the monthly averages within that quarter/year.

 

Average allocated tangible shareholders' equity

Calculated as the average of the previous month's period end allocated tangible equity and the current month's period end allocated tangible equity. The average allocated tangible shareholders' equity for the quarter/year is the average of the monthly averages within that quarter/year.

 

Cost: income ratio

Operating expenses divided by total income.

 

Basic earnings/(loss) per share contribution (Barclays Core and Non-Core)

 

The calculation is consistent with the IFRS measure and applied to the Barclays Core and Non-Core: statutory profit after tax attributable to ordinary shareholders, including an adjustment for the tax credit in reserves in respect of other equity instruments, divided by the Group basic weighted average number of shares. The components of the calculation have been included on page 34.

 

Loan loss rate

 

Is quoted in basis points and represents total annualised loan impairment divided by gross loans and advances to customers and banks held at amortised cost at the balance sheet date.

 

Loan: deposit ratio

 

Loans and advances divided by customer accounts calculated for Barclays UK, Barclays International and Non-Core, excluding investment banking businesses. This excludes particular liabilities issued by the retail businesses that have characteristics comparable to retail deposits (for example structured Certificates of Deposit and retail bonds), which are included within debt securities in issue.

 

Net interest margin

 

Annualised net interest income divided by average customer assets. The components of the calculation have been included on page 18.

 

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 34.

 

Barclays Core reconciliation

 

for the three months ended

 

 

 

31.03.17


31.03.16

Barclays UK

Barclays International

Head Office

Barclays Core


Barclays UK

Barclays International

Head Office

Barclays Core


£m

£m

£m

£m


£m

£m

£m

£m

Total income

1,841

4,138

(82)

5,897


1,803

3,513

(33)

5,283

Credit impairment charges and other provisions

(178)

(346)

-

(524)


(146)

(269)

1

(414)

Net operating income/(expenses)

1,663

3,792

(82)

5,373


1,657

3,244

(32)

4,869

Operating expenses excluding litigation and conduct

(959)

(49)

(3,443)


(952)

(85)

(3,258)

Litigation and conduct

4

(13)

(10)

(19)


(1)

(4)

(7)

(12)

Operating expenses

(955)

(2,448)

(59)

(3,462)


(953)

(2,225)

(92)

(3,270)

Other net income

-

12

-

12


-

8

1

9

Profit/(loss) before tax

708

1,356

(141)

1,923


704

1,027

(123)

1,608

Attributable profit/(loss)

470

(123)

1,184


467

(92)

950





















Average allocated tangible equity (£bn)

8.9

27.7

7.6

44.2


9.3

25.1

5.0

39.3

Risk weighted assets (£bn)

66.3

52.9

333.5


69.7

40.3

312.2











 

Returns

 

Return on average allocated tangible equity is calculated as annualised statutory profit after tax for the period attributable to ordinary equity holders of the parent (adjusted for the tax credit recorded in reserves in respect of interest payments on other equity instruments) divided by average allocated tangible equity for the period as appropriate, excluding non-controlling and other equity interests for businesses. Allocated tangible equity has been calculated as 12.0% (2016: 11.5%) of CRD IV fully loaded risk weighted assets for each business, adjusted for CRD IV fully loaded capital deductions, excluding goodwill and intangible assets, reflecting the assumptions the Group uses for capital planning purposes. Head Office average tangible equity represents the difference between the Group's average tangible equity and the amounts allocated to businesses.

 

Three months ended

Three months ended


31.03.17

31.03.16

Attributable profit

£m

£m

Barclays UK

470

467

   Corporate and Investment Bank

460

376

   Consumer, Cards and Payments

377

199

Barclays International

837

575

Head Office

(123)

(92)

Barclays Core

1,184

950

Barclays Non-Core

(193)

(603)

Africa Banking discontinued operation

(801)

86

Barclays Group

190

433




Tax credit in respect of interest payments on other equity instruments



Barclays UK

9

6

   Corporate and Investment Bank

23

18

   Consumer, Cards and Payments

4

3

Barclays International

27

21

Head Office

(3)

(2)

Barclays Core

33

25

Barclays Non-Core

5

4

Africa Banking discontinued operation

-

-

Barclays Group

38

29




Profit/(loss) attributable to ordinary equity holders of the parent



Barclays UK

479

473

   Corporate and Investment Bank

483

394

   Consumer, Cards and Payments

381

202

Barclays International

864

596

Head Office

(126)

(94)

Barclays Core

1,217

975

Barclays Non-Core

(188)

(599)

Africa Banking discontinued operation

(801)

86

Barclays Group

228

462

 

Returns (continued)

 

Three months ended

Three months ended


31.03.17

31.03.16

Average allocated tangible equity

£bn

£bn

Barclays UK

8.9

9.3

   Corporate and Investment Bank

23.5

21.6

   Consumer, Cards and Payments

4.2

3.4

Barclays International

27.7

25.1

Head Office1

7.6

5.0

Barclays Core

44.2

39.3

Barclays Non-Core

5.2

9.0

Barclays Group

49.4

48.3




Return on average allocated tangible equity

%

%

Barclays UK

21.6%

20.5%

   Corporate and Investment Bank

8.2%

7.3%

   Consumer, Cards and Payments

36.4%

23.4%

Barclays International

12.5%

9.5%




Barclays Core2

11.0%

9.9%




Barclays Group

1.8%

3.8%

 

 

1

Includes the Africa Banking discontinued operation.

2

Includes Head Office.

 

Earnings per share




Three months ended

Three months ended


31.03.17

31.03.16

Profit/(loss) attributable to ordinary equity holders of the parent1

£m

£m

Barclays Core

1,217

975

Barclays Non-Core

(188)

(599)

Africa Banking discontinued operation

(801)

86

Barclays Group

228

462





m

m

Basic weighted average number of shares

16,924

16,841




Basic earnings per ordinary share

p

p

Barclays Core contribution

7.2

5.8

Barclays Non-Core contribution

(1.1)

(3.6)




Barclays Group

1.3

2.7

 

 

 

 

1

The profit after tax attributable to other equity holders of £139m (Q116: £104m) is offset by a tax credit recorded in reserves of £38m (Q116: £29m). The net amount of £101m (Q116: £75m), along with non-controlling interests (NCI) is deducted from profit after tax in order to calculate earnings per share and return on average tangible shareholders' equity.

 

Tangible net asset value





As at

As at

As at

31.03.17

31.12.16

31.03.16


£m

£m

£m

Total equity excluding non-controlling interests

65,536

64,873

62,166

Other equity instruments

                        (7,690)

(6,449)

                         (5,312)

Goodwill and intangibles1

                        (8,328)

(9,245)

                         (8,551)

Tangible shareholders' equity attributable to ordinary shareholders of the parent

49,518

49,179

48,303






m

                                 m

m

Shares in issue

16,980

16,963

16,844






p

                                 p

p

Tangible net asset value per share

292

290

286

 

 

1

Includes goodwill and intangibles in relation to Africa Banking.

Notes

The term Barclays or Group refers to Barclays PLC together with its subsidiaries. Unless otherwise stated, the income statement analysis compares the three months ended 31 March 2017 to the corresponding three months of 2016 and balance sheet analysis as at 31 March 2017 with comparatives relating to 31 December 2016 and 31 March 2016. The abbreviations '£m' and '£bn' represent millions and thousands of millions of Pounds Sterling respectively; the abbreviations '$m' and '$bn' represent millions and thousands of millions of US Dollars respectively; and the abbreviations '€m' and '€bn' represent millions and thousands of millions of Euros respectively.

There are a number of key judgement areas, for example impairment calculations, which are based on models and which are subject to ongoing adjustment and modifications. Reported numbers reflect best estimates and judgements at the given point in time.

Relevant terms that are used in this document but are not defined under applicable regulatory guidance or International Financial Reporting Standards (IFRS) are explained in the results glossary that can be accessed at home.barclays/results.

The information in this announcement, which was approved by the Board of Directors on 27 April 2017, does not comprise statutory accounts within the meaning of Section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 December 2016, which included certain information required for the Joint Annual Report on Form 20-F of Barclays PLC and Barclays Bank PLC to the US Securities and Exchange Commission (SEC) and which contained an unqualified audit report under Section 495 of the Companies Act 2006 (which did not make any statements under Section 498 of the Companies Act 2006) have been delivered to the Registrar of Companies in accordance with Section 441 of the Companies Act 2006.

These results will be furnished as a Form 20-F to the SEC as soon as practicable following their publication. Once furnished with the SEC, copies of the Form 6-K will also be available from the Barclays Investor Relations website home.barclays/results and from the SEC's website at www.sec.gov.

Barclays is a frequent issuer in the debt capital markets and regularly meets with investors via formal road-shows and other ad hoc meetings. Consistent with its usual practice, Barclays expects that from time to time over the coming quarter it will meet with investors globally to discuss these results and other matters relating to the Group.

Non-IFRS performance measures

Barclays management believes that the non-IFRS performance measures included in this document provide valuable information to the readers of the financial statements as they enable the reader to identify a more consistent basis for comparing the business' performance between financial periods, and provide more detail concerning the elements of performance which the managers of these businesses are most directly able to influence or are relevant for an assessment of the Group. They also reflect an important aspect of the way in which operating targets are defined and performance is monitored by Barclays' management. However, any non-IFRS performance measures in this document are not a substitute for IFRS measures and readers should consider the IFRS measures as well. Refer to the appendix on pages 30-34 for further information, reconciliations and calculations of non-IFRS performance measures included throughout this document, and the most directly comparable IFRS measures.

Forward-looking statements

This document contains certain forward-looking statements within the meaning of Section 21E of the US Securities Exchange Act of 1934, as amended, and Section 27A of the US Securities Act of 1933, as amended, with respect to the Group. Barclays cautions readers that no forward-looking statement is a guarantee of future performance and that actual results or other financial condition or performance measures could differ materially from those contained in the forward-looking statements. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements sometimes use words such as 'may', 'will', 'seek', 'continue', 'aim', 'anticipate', 'target', 'projected', 'expect', 'estimate', 'intend', 'plan', 'goal', 'believe', 'achieve' or other words of similar meaning. Examples of forward-looking statements include, among others, statements or guidance regarding the Group's future financial position, income growth, assets, impairment charges, provisions, notable items, business strategy, structural reform, capital, leverage and other regulatory ratios, payment of dividends (including dividend pay-out ratios and expected payment strategies), projected levels of growth in the banking and financial markets, projected costs or savings, original and revised commitments and targets in connection with the strategic cost programme and the Group Strategy Update, rundown of assets and businesses within Barclays Non-Core, sell down of the Group's interest in Barclays Africa Group Limited, estimates of capital expenditures and plans and objectives for future operations, projected employee numbers and other statements that are not historical fact. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. These may be affected by changes in legislation, the development of standards and interpretations under International Financial Reporting Standards, evolving practices with regard to the interpretation and application of accounting and regulatory standards, the outcome of current and future legal proceedings and regulatory investigations, future levels of conduct provisions, future levels of notable items, the policies and actions of governmental and regulatory authorities, geopolitical risks and the impact of competition. In addition, factors including (but not limited to) the following may have an effect: capital, leverage and other regulatory rules (including with regard to the future structure of the Group) applicable to past, current and future periods; UK, US, Africa, Eurozone and global macroeconomic and business conditions; the effects of continued volatility in credit markets; market related risks such as changes in interest rates and foreign exchange rates; effects of changes in valuation of credit market exposures; changes in valuation of issued securities; volatility in capital markets; changes in credit ratings of any entities within the Group or any securities issued by such entities; the potential for one or more countries exiting the Eurozone; the implications of the exercise by the United Kingdom of Article 50 of the Treaty of Lisbon and the disruption that may result in the UK and globally from the withdrawal of the United Kingdom from the European Union; the implementation of the strategic cost programme; and the success of future acquisitions, disposals and other strategic transactions. A number of these influences and factors are beyond the Group's control. As a result, the Group's actual future results, dividend payments, and capital and leverage ratios may differ materially from the plans, goals, expectations and guidance set forth in the Group's forward-looking statements. Additional risks and factors which may impact the Group's future financial condition and performance are identified in our filings with the SEC (including, without limitation, our annual report on form 20-F for the fiscal year ended 31 December 2016), which are available on the SEC's website at www.sec.gov.

Subject to our obligations under the applicable laws and regulations of the United Kingdom and the United States in relation to disclosure and ongoing information, we undertake no obligation to update publicly or revise any forward looking statements, whether as a result of new information, future events or otherwise.

 

 

Shareholder Information

 

 


 


Results timetable1

Date

2017 interim results announcement

28 July 2017



 





% Change

Exchange rates2

31.03.17

31.12.16

31.03.16


31.12.16

31.03.16

Period end - USD/GBP

1.25

1.23

1.44


2

(13)

3 Month average - USD/GBP

1.24

1.24

1.44


-

(14)

Period end - EUR/GBP

1.17

1.17

1.26


-

(7)

3 Month average - EUR/GBP

1.16

1.15

1.30


1

(11)

Period end - ZAR/GBP

16.68

16.78

21.17


(1)

(21)

3 Month average - ZAR/GBP

16.34

17.29

22.72


(5)

(28)








Share price data

31.03.17

31.12.16

31.03.16




Barclays PLC (p)

225.10

223.45

150.00




Barclays PLC number of shares (m)

16,980

16,963

16,844




Barclays Africa Group Limited (formerly Absa Group Limited) (ZAR)

139.51

168.69

149.59




Barclays Africa Group Limited (formerly Absa Group Limited)

number of shares (m)

848

848

848











For further information please contact














Investor relations

Media relations



Kathryn McLeland +44 (0) 20 7116 4943

Thomas Hoskin +44 (0) 20 7116 4755










More information on Barclays can be found on our website: home.barclays










Registered office







1 Churchill Place, London, E14 5HP, United Kingdom. Tel: +44 (0) 20 7116 1000. Company number: 48839








Registrar







Equiniti, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA United Kingdom.

Tel: 0371 384 20553 from the UK or +44 (0) 121 415 7004 from overseas.








 

 

1

Note that these announcement dates are provisional and subject to change.

2

The average rates shown above are derived from daily spot rates during the year.

3

Lines open 8.30am to 5.30pm UK time, Monday to Friday, excluding public holidays in England and Wales.

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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