Final Results - Year Ended 31 Dec 1999, Part 3

Barclays PLC
15 February 2000

Part 2


Balance sheet

Capital resources                    1999              1998
                                       £m                £m
Shareholders' funds                 8,483             7,842
Minority interests                    352               314
                                    8,835             8,156
Loan capital                        4,597             3,734
                                   13,432            11,890

The Group continues to manage actively both its debt and equity capital.
Total capital resources increased in the year by £1,588m before adverse
exchange rate translation differences of £46m.

Shareholders' funds increased by £711m before adverse exchange differences
of £70m.  Profit retentions (excluding goodwill write-backs) of £1,151m were
reduced by share buy-backs, including costs, of £504m.

Loan capital rose by £863m consisting of capital raisings of £859m,
repayments of £18m and exchange movements of £22m.

Capital ratios

Weighted risk assets and capital resources, as defined for supervisory
purposes by the Financial Services Authority, comprise:

                                       1999             1998
Weighted risk assets:                    £m               £m
Banking book                                                
on-balance sheet                     84,535           78,577
off-balance sheet                    15,567           14,194
associated undertakings               1,341            2,623
Total banking book                  101,443           95,394
                                                            
Trading book                                                
market risks                          6,015            8,060
counterparty and settlement risks     8,420            6,346
Total trading book                   14,435           14,406
Total weighted risk assets          115,878          109,800
                                                            
Capital resources:                                          
tier 1 capital                        8,696            8,031
tier 2 capital                        4,948            4,154
tier 3 capital                          343              330
Total gross capital resources        13,987           12,515
Less: supervisory deductions          (853)            (830)
Total net capital resources          13,134           11,685
                                                            
                                          %                %
Tier 1 ratio                            7.5              7.3
Risk asset ratio                       11.3             10.6
                                                                            

Total Assets

The Group's balance sheet grew by 16% in 1999 compared with a decline in
assets of 2%, after adjusting for the impact of the disposal of the former
BZW businesses, during 1998.

The Barclays Capital balance sheet grew steadily in 1999 with a year-on-year
increase of 26%, or £30bn to £145bn following a contraction of 24% in the
second half of the previous year.  The growth in assets was partly
attributable to a £8bn increase in assets from the collateralised equity
financing business which continues to build customer inventory financing
positions following the purchase of this business from Daiwa in 1998.  The
remaining increase arose from a number of businesses and reverses the
decline in business activity, particularly in repos, from the previous year.
In addition there was a £12bn increase in debt securities and treasury stock
due to the build-up of year-end liquidity as a Year 2000 contingency
measure.  Total weighted risk assets increased by only 9% partly reflecting
the implementation of Daily Value at Risk as the regulatory measure for
market risk and partly as a result of asset growth in reverse repos which
attract a lower average risk weighting.

Corporate Banking advances grew by 5% over the year to £44bn.  Within the
UK, middle market lendings increased 10% to £22bn with the growth primarily
in respect of larger customers.  Lending volumes in the international
business grew by 17% to £7bn (1998: £6bn) with growth predominantly in the
rest of Europe and the Middle East.  Lending volumes in Latin America have
been held at 1998 levels.  Total assets in the leasing and asset finance
business increased 5% to £9bn primarily in respect of the UK middle market.
Total assets increased by £500m as a result of an increase to a majority
interest in Cairo Barclays SAE.

Retail Financial Services experienced strong asset growth of 6% in the
second half of 1999 compared with growth of 3% in the first half of the year
(adjusted for the impact of the sale of Merck Finck and Co.).  Consumer
lending balances in the United Kingdom increased by 9% to £6.2bn over the
year and mortgage outstandings grew by 8% to £16.8bn.  Barclaycard's
extended credit balances have also continued to grow.  Wealth Management
assets have grown steadily across all business units, with particularly high
growth in the Caribbean and Private Banking as a result of new business
volumes.

As part of the Group's programme for managing its asset and weighted risk
asset portfolios a securitisation of $1bn of bonds backed by the UK credit
card receivables was successfully offered for sale in November 1999.  This
was the first credit card backed securitisation by a UK clearing bank.  This
transaction did not reduce total assets but resulted in a reduction in
weighted risk assets of some £600m within Other operations.


Analysis of operating profit by business

Retail Financial Services

Retail Financial Services brings together all of the Group's retail
interests around the world.  Its purpose is to serve customers by
understanding their needs as individuals and by offering services and
products that anticipate and satisfy their requirements.

Retail Financial Services has four strategic aims:

-    To become the customer's first choice in the United Kingdom as the
 provider of innovative and dependable financial solutions.  Within Retail
 Financial Services there are more than 13 million UK customers, with around
 one in six of these customers now purchasing three or more products from
 Barclays.

-    To become a market leader for affluent and wealthy customers in the
 United Kingdom and continental Europe by building on the Group's strong
 customer base.

-    To capitalise on Barclaycard's  position as the leading credit card and
 related products provider in Europe.

-    To grow long term savings and investment business in the United Kingdom
 and continental Europe in mutual funds, investment savings, life assurance
 and pensions.  It is anticipated that the needs of customers across Europe
 will change as people take greater responsibility for their own pension
 arrangements.

                                       1999             1998
                                         £m               £m
Net interest income                   2,959            2,825
Net fees and commissions              1,780            1,723
Income from long-term assurance          44              109
business
Other operating income                  143               62
Total income *                        4,926            4,719
Total costs                         (2,723)          (2,852)
Provisions for bad and doubtful       (490)            (390)
debts
Operating profit                      1,713            1,477

* 1999 figure includes a £75m provision for the possible cost of redress to
personal pension customers

Retail Financial Services delivered a strong performance with good
underlying profit growth in each of its major business groupings.  Operating
profit increased by 16%, or £236m, to £1,713m.  Adjusting for the impact of
the personal pension redress provision, operating profit rose by 21%.

Net interest income grew by £134m, or 5%, to £2,959m primarily as a result
of strong volume growth in UK consumer lending and extended credit balances
at Barclaycard, with good growth in UK savings balances and an improved
contribution from UK mortgage lending.  The overall UK lending margin
improved slightly as a result of a change in the business mix and the
overall UK deposit margin narrowed slightly due to pricing pressure and
lower interest rates.

Net fees and commissions increased by £57m, or 3%, to £1,780m, despite a
reduced contribution from Barclays Insurance following the move to in-house
underwriting of all payment protection insurance.  In-house underwriting is
included in Other operating income and represents the majority of the £81m
increase compared to 1998.  Barclays Stockbrokers benefited from good growth
in investment management income and increased dealing activity.  There were
also improved business volumes in Private Banking and UK Premier.
Barclaycard fees and commissions rose as a result of higher transaction
volumes in both the issuing and acquiring businesses.

Total customer funds, which include assets under management and on-balance
sheet deposits, grew by 10% to £118bn, as a result of good growth in long
term savings and investments (1998: £107bn, excluding the Merck Finck
business which was sold on 31st March 1999).  Assets under management
excluding the Merck Finck business increased 16% to £55bn, of which
approximately half was attributable to net new business and approximately
half to market movements.  Loans to customers rose by 8% to £40bn (1998:
£37bn).

Total costs reduced by 5% to £2,723m (1998: £2,852m) as a result of lower
operating costs and are below the 1997 level of £2,753m.  Staff costs,
excluding restructuring costs, were 4% lower than in 1998.  The total number
of staff employed fell to 55,300 (1998: 59,100).  Efficiency improvements
were achieved through centralisation initiatives, including the integration
of central IT and operations infrastructures.  This includes migration of
telephone call handling from the branches to central call centres and the
integration of Barclaycard's call centres to combine activities across
different sites.

Investment in significant e-commerce developments included further
development of internet banking, the launch of Barclays.net (the first
Internet Service Provider offered by a UK bank) and the launch of an on-line
internet based dealing service at Barclays Stockbrokers.  At the end of 1999
a total of 540,000 customers were registered for these services.

Provisions rose by £100m to £490m, primarily as a result of volume growth in
UK consumer lending and extended credit balances in Barclaycard and also
less favourable UK economic factors that affected the first half of the
year.  Provisions in Africa, the Caribbean and mainland Europe remained at
low levels.

Retail Financial Services is organised for reporting purposes into three
major business groupings.  The operating profit for these groupings is shown
below:

Analysis of Retail Financial Services operating profit
                                       1999             1998
                                         £m               £m
Retail Customers*                       884              825
Wealth Management                       428              318
Barclaycard                             401              334
Operating profit                      1,713            1,477

* 1999 figure includes a £75m provision for the possible cost of redress to
personal pension customers.

Retail Customers

This business provides a wide range of services and products to personal and
small business customers throughout the United Kingdom and to personal and
corporate customers in parts of Africa.  These services are provided through
a network of branches and ATMs, and through direct channels such as the
telephone and the internet.

Operating profit in Retail Customers increased by 7% to £884m.  Excluding a
further provision of £75m (1998: nil) for the possible cost of redress to
personal pension customers (non-priority cases) operating profit increased
by 16%.  The provision for possible redress for personal pension customers
increased during the year as a result of increased response levels and
revised mortality and investment assumptions published by the Personal
Investment Authority in August 1999.

Total income was broadly flat at £2,797m (1998: £2,782m) as a result of the
further pension provision of £75m.  Costs fell 7% to £1,588m (1998: £1,714m)
as a result of continued centralisation of processing activity.  An increase
in provisions of £82m to £325m reflects volume growth in UK consumer lending
and less favourable UK economic factors that affected the first half of last
year.


UK Personal Customers

Average consumer lending balances grew by 11% to £5.9bn (1998: £5.3bn)
benefiting from the introduction of new data mining and enhanced risk
assessment techniques which allow instant or pre-approved credit decisions
and a series of successful promotional campaigns.  Cross sales of related
insurance products remained strong.

Average UK mortgage outstandings increased 6% to £16.1bn (1998: £15.2bn).
The launch of a new range of Base Rate tracker mortgages contributed to
strong mortgage lending growth in the second half of the year with gross new
lending rising 37% to £4.8bn (1998: £3.5bn).  Market share of gross new
advances was maintained at 3.8%.  Fixed and capped rate mortgages accounted
for 56% of gross new mortgage lending (1998: 69%).  As a result of this
shift in business mix towards variable rate products, margins increased
slightly.  The cost of incentives, including the cost of the Guaranteed
Mortgage Rate product increased slightly to £24m (1998: £21m).

Average UK savings balances grew by 7% to £19.6bn (1998: £18.3bn), in line
with the market growth.  Net interest income from savings balances increased
by 2% despite the competition, lower interest rates and a move to term-
products which led to a modest reduction in the overall savings margin.

Good progress was achieved in long-term savings and investment activities as
sales of unit trusts, managed portfolios and individual life and pension
products grew by 28% to £190m in terms of Annual Premium Income.  This
reflected a strong sales performance helped by the final opportunity for PEP
purchases and the introduction of the ISA.  Assets under management
increased by 15% to £13.1bn.  b2 extended its product range and increased
assets under management to £277m.

The number of UK personal current accounts rose by 5% to 8.1m (1998: 7.7m).
This increase was supported by market leading innovations introduced during
1999, which included extending further the benefits of the value-added
Additions account.  By the end of the year, the number of Additions accounts
had increased by 35% over 1998, to 871,000.  Further innovations included
the extension to savings accounts of the successful instant banking
initiative which allows customers to drawdown against uncleared funds.

The demand for on-line banking strengthened following the launch of internet
banking.  The Group's market-leading position was extended by a new service
release, incorporating improved service features and laying down the
infrastructure for future enhancements and new access channels such as
interactive TV.  By the end of 1999, the number of customers registered for
the on-line banking service had increased to 500,000 (1998: 205,000), while
the combined total of customers using on-line and telephone banking rose to
over 1.5 million (1998: 1 million).

Income from sales of household and personal insurance increased by 24%.

UK Small Business

Total income from UK Small Business was maintained at 1998 levels as volume
growth in both deposits and advances offset the impact of a reduced
contribution from current accounts as a result of lower interest rates.
Lending volumes grew 6% to £1.7bn (1998: £1.6bn) and deposits grew 12% to
£6.4bn (1998: £5.7bn).  Fees and commissions remained flat as a result of
increased pressure on money transmission income.

Total costs within UK Small Business reduced by 8% compared to 1998, as a
result of efficiency benefits from the continued focus on centralising
activities.  Provisions for bad and doubtful debts were lower than the 1998
levels reflecting continued improvement in asset quality resulting from an
enhanced risk management process.  Over 67,000 small business customers are
now registered for the on-line banking service (1998: 24,000) supplementing
the new 24 hour telephone banking service which has 170,000 small business
customers (1998: 142,000).

Africa

Operating profit rose by 54% to £98m, reflecting strong performances in
Ghana and also, despite difficult economic conditions, in Zimbabwe.  The
performance in both of these countries benefited from the launch of a
standardised personal loan account and the introduction of a corporate
market programme to enhance customer relationships.

Income growth across Africa rose by 4% to £242m.  Overall costs fell by 15%
to £135m primarily as a result of the job reduction programme announced in
August 1999.

Wealth Management

Wealth Management serves affluent and high net worth clients globally, with
relationship based services and bespoke products, particularly in the areas
of banking, asset management and long-term financial planning.  The branch
networks in Spain, France, Greece and Portugal serve the medium and high net
worth personal markets.  Private Banking offers an integrated asset
management service from offices around the world servicing clients from over
100 countries. Offshore Services, with offices in the Channel Islands, Isle
of Man, Cyprus, Middle East and London, provides specialist banking services
for personal customers and companies which are non-UK based.  Wealth
Management also includes UK Premier Banking, Stockbrokers and the Caribbean.

Operating profit in Wealth Management rose by 35% to £428m predominantly
driven by strong growth in UK Premier Banking, Private Banking, Offshore
Services, Stockbrokers and the continental European retail businesses.

Total income grew by 11% to £1,161m, with increased contributions from all
businesses.  There was particularly good income growth in Offshore Services
(up 17% to £233m), Private Banking (up 17% to £153m), Stockbrokers (up 26%
to £136m) and the Caribbean (up 15% to £130m).

Growth in UK Premier Banking operating profits benefited from a 15% increase
in customer numbers to 129,000 (31st December 1998: 112,000) and growth in
business volumes per customer.

The continental European retail businesses performed well, with operating
profit up 88% to £60m excluding the contribution from Merck Finck following
the sale of this business.  Strong income growth in each country benefited
from buoyant stock markets and continued successful targeting of affluent
and high net worth individuals.  This was reinforced by the launch of a
range of innovative products, including the first 'sub 5%' 15 year mortgage
in Spain.

The Caribbean operations achieved a good performance, with operating profits
up by 16% to £48m aided by an improved performance from the strong offshore
market, increased lending volumes and the establishment of Barclaycall
customer service units offshore.

In Offshore Services operating profit rose 16% to £150m, with overall
deposit balances growing by 9% to £12.6bn.  As a result of stronger growth
in higher margin products such as currency accounts, which benefited from
increased business from Corporate Banking customers, the overall margin was
maintained despite competitive pressure.

Private Banking operating profit rose 22% to £41m, reflecting increased
business levels and favourable market conditions.  Clients' funds increased
19% to £24.7bn (1998: £20.7bn).

Stockbrokers' operating profit grew strongly as a result of good growth in
investment management income and increased dealing activity.  Despite a
decline in demutualisation activity during 1999, average client deals per
day of 6,600 were 10% higher than in 1998, benefiting from the launch of an
on-line internet based dealing service.

Overall costs in Wealth Management increased by 2% to £738m.  This reflected
the increased investment in front line staff and IT infrastructure to
support current and future business growth, and an increase in client
numbers, assets under management and customer deposits.  Technology
investment included the development of internet capability in Stockbrokers
and Offshore Services.

Barclaycard

Barclaycard is the largest credit card business in Europe.  It offers a full
range of credit card services to individual customers, together with card
payment facilities to retailers and other businesses.  Barclaycard was the
first UK credit card with a web presence which offers a range of services on-
line to cardholders including statement and transaction information.  In
November 1999, Barclaycard launched a pilot joint venture in Wireless
Application Protocol (WAP), which enables cardholders to use their mobile
phone to access their Barclaycard accounts, online news, purchase goods and
send and receive e-mail.

Barclaycard profits increased by 20% to £401m (1998: £334m).  Total income
growth rose 9% to £968m primarily as a result of an increase in average
extended credit balances up 17% to £4.8bn and a 9% increase in turnover
volumes.  Income growth was supported by further improvements to the product
range, including the introduction of a new rewards scheme, free extended
warranty and the launch of new platinum Visa and Mastercards.  These
initiatives helped to improve new customer recruitment up 35% to 646,000
(1998: 478,000) and retentions, with the number of customers leaving down
12% to 382,000 (1998: 432,000).

The overall interest margin was maintained as a result of strong growth in
interest earning balances relative to non-interest earning balances being
offset by a reduction in rate spreads.  This reflected the introduction of a
pricing strategy to increase Barclaycard's share of an individual customer's
credit card borrowing requirements by offering a reduced interest rate on
extended credit balances to customers with higher transaction volumes.

Fees and commissions grew by 5% as a result of increased volumes in card
transactions up 10% to 1.1billion (1998: 1 billion) which was largely offset
by continued pressure on merchant acquisition fee margins.

Total costs in Barclaycard fell by 4% to £397m largely as a result of the
benefits associated with the change programme announced in September 1998
resulting in the loss of 1,100 jobs over a 3 year period.  The reduction in
the workforce remains on track, although increases in staff numbers will
continue in the international operations as Barclaycard continues to expand
into Europe and in e-commerce activities.

The charge for bad and doubtful debts increased by 18% to £170m.  This
primarily reflected the impact of growth in interest earning balances.  The
credit quality of outstanding balances was maintained through a combination
of robust initial assessment and ongoing credit management.

Further investment was made in expanding Barclaycard's presence in Germany
and France.  New cards were launched in Spain and Greece.  As a result the
number of cards in issue overseas grew 43% to 1 million (1998: 700,000).


Corporate Banking

Corporate Banking provides relationship banking to the Group's middle
market, large corporate and institutional customers.  Customers are served
by a network of 1,200 specialist relationship managers across the United
Kingdom who provide access to an extensive range of products.  Corporate
Banking also offers its customers access to business centres in the rest of
Europe, the United States and the Middle East.  In addition, an office in
Miami provides finance and correspondent banking services to the Group's
customers in Latin America.

Corporate Banking's close working relationships with Barclays Capital
ensures that large corporate and institutional customers have access to the
capital markets and to specialist investment banking products which
complement Corporate Banking's product and service range.

Corporate Banking has a strong competitive position in the United Kingdom,
where around a quarter of middle market companies bank with Barclays.
Opportunities for growth exist within both the United Kingdom, through
customer acquisition and increased product penetration, and in the rest of
Europe, where our presence exceeds our UK and many of our European rivals.

                                       1999             1998
                                         £m               £m
Net interest income                   1,252            1,214
Net fees and commissions                690              613
Other operating income                 (12)               24
Total income                          1,930            1,851
Total costs                           (863)            (862)
Provisions for bad and doubtful       (120)                2
debts
Operating profit before impact of       947              991
Finance Act
Write-down of leases                      -             (40)
Operating profit                        947              951

Corporate Banking produced a good performance in 1999.  Operating profit,
before the impact of a £40m write-down in lease receivables in 1998, reduced
by £44m or 4% to £947m as a result of an increase in the net provision
charge to £120m (1998: net credit £2m).  The £122m increase in provisions
for bad and doubtful debts mainly reflected the lower levels of releases and
recoveries of £86m (1998: £168m).  New and increased provisions were
slightly higher than the levels experienced last year.

Net interest income rose by 5% after adjusting for a £20m recovery in 1998
from two debts previously written off, which was in addition to a £31m
specific provision recovery in respect of these customers.

Corporate Banking achieved good growth in business lending volumes in 1999,
primarily to larger and higher quality corporate customers.  Average
customer lending balances increased by 7% to £43bn as a result of steady
growth in UK lending and strong growth in international lending.

High levels of origination have continued within large corporate banking in
the United Kingdom as a result of increased acquisition finance activity.
Middle market activity has also been strong as a result of the introduction
of enhanced customer value propositions.

Average lending volumes in the international businesses have increased by
17% to £7bn (1998: £6bn) with growth predominantly in the rest of Europe and
the Middle East.  Lending volumes in Latin America have been held at 1998
levels.

Overall lending margins have been maintained.  UK lending margins continued
to narrow, reflecting the improving quality of the lending portfolio.
Overseas margins have improved year-on-year as a result of adverse
conditions in the debt capital markets in the second half of 1998.  Risk
adjusted margins, which take account of expected credit losses, have been
maintained.

Average UK deposit volumes increased by 9% to £32bn despite continued
contraction in corporate liquidity.  The overall deposit margin has reduced
slightly, reflecting stronger growth in the lower margin treasury deposits
and a reduced contribution from non-interest bearing current accounts.

Net fees and commissions increased strongly by 13% to £690m.  Lending
related fees rose strongly reflecting a higher volume of arrangement fees in
respect of on and off-balance sheet financing products.  Money transmission
income was at a similar level to 1998 despite continued pricing pressure.
Strong growth in electronic products has resulted in over 25% of UK
corporate customers being registered for these services.  Foreign exchange
related income increased as a result of a new and consistent pricing policy
introduced in the second half of 1998.

Other operating income decreased as a result of increased credit provisions
and difficult trading conditions in the Group's Brazilian associate, Banco
Barclays e Galicia SA.  In addition, there was a reduced contribution from
Cairo Barclays SAE, which became a subsidiary from 7th June 1999.

Costs were maintained at 1998 levels despite the impact of the consolidation
of Cairo Barclays which added £5m to costs in the second half of 1999.
Costs in the second half of 1999 were lower than the same period in 1998,
reflecting the continuing restructuring of Corporate Banking during 1999.  A
reduction in staff numbers of 400, primarily as a result of this
restructuring, was offset by a 500 increase in staff as a result of the
acquisition of a controlling share in Cairo Barclays.  In addition there
were a further 200 UK staff under notice of redundancy as at 31st December
1999.  After adjusting for the impact of the acquisition of a controlling
share in Cairo Barclays, staff costs were maintained at 1998 levels.


Barclays Capital

Barclays Capital conducts the Group's international investment banking
business.  The business focuses on areas where it believes it has
competitive advantage and which are integral to the Group.  Barclays Capital
serves as the Group's principal point of access to the wholesale markets and
also deals in these markets with governments, supranational organisations,
corporates, banks, insurance companies and other institutional investors.

The activities of Barclays Capital are grouped into two principal areas:
Rates which include sales, trading and research relating to government
bonds, money markets, foreign exchange, commodities, and their related
derivative instruments and Credit which includes origination, sales, trading
and research relating to loans, securitised assets, corporate bonds and
their related derivative instruments and private equity investment and
equity derivatives.

Barclays Capital is an important component of the overall Group, providing a
variety of complementary services and products to all of the Group's
businesses and their customers.  It also provides a counterbalance to
disintermediation of the traditional corporate lending businesses.

In 1999 the European capital markets expanded significantly driven by the
introduction of the euro and increased corporate fund raising on the back of
rapid corporate consolidation.  Barclays Capital, with its leading European
loan business and strong client franchise, is well positioned to benefit
from the strong growth in this market.  In addition, the globalisation of
investment flows creates significant opportunities for investment banks like
Barclays Capital which has global capability for providing financing
solutions to companies.

                                       1999             1998
                                         £m               £m
Net interest income                     400              417
Dealing profits                         554             (29)
Net fees and commissions                163              159
Other operating income                   40               44
Total income                          1,157              591
Total costs                           (805)            (701)
Provisions for bad and doubtful        (36)            (160)
debts
Operating profit                        316            (270)

Barclays Capital reported an operating profit of £316m compared to an
operating loss of £270m in 1998.  This reflects a strong performance and a
return to stability in the financial markets following the 1998 Russian
economic crisis and the subsequent dislocation in the world credit markets.
Both the Rates and Credit businesses performed well despite a more
challenging trading environment in the second half of the year, as a result
of widening credit spreads and rising sterling interest rates.

Dealing profits were £554m in 1999 (1998: dealing losses of £29m).  This was
achieved while operating at lower risk levels compared to last year.
Average Daily Value at Risk utilisation reduced by 23% to £16.1m (1998:
(£20.9m)).  The Rates business continued to perform strongly with good
contributions from the government bonds, interest rate derivatives and
foreign exchange businesses.  In the Credit business, equity derivatives and
secondary corporate bond businesses also made good contributions benefiting
from increased customer related activities.

Net interest income decreased by 4% or £17m, to £400m as a result of lower
interest earned from reduced regulatory capital employed.  This was
partially offset by a strong performance from the money markets business
which benefited from a favourable interest rate environment during the year
and the structured capital markets business, which had a record year in its
client related activity.

Net fees and commissions increased by 3% to £163m reflecting growth in fees
earned in the primary corporate bond business and from loan arrangement
activity.

Barclays Capital benefited from diversifying and strengthening its client
base for bond issues as it maintained its leading position in sterling bond
issuance and European syndicated loan markets.  Although the new euro bond
market was highly competitive in 1999, good progress was made with new
issues for Abbey National, Carrefour, Kappa Packaging Group and Vodafone
AirTouch.

Other operating income consists principally of realisations from private
equity business, which had a record performance in 1999 including
significant contributions from continental Europe.

Provisions for bad and doubtful debts amounted to £36m and was mainly in
respect of overseas exposures.  In 1998, £130m of the total charge of £160m
was in respect of the default of currency forward contracts and repurchase
agreements by Russian counterparties.

Costs increased by 15% to £805m (1998: £701m), reflecting a higher level of
performance related pay in line with improved profitability.  Excluding
performance related pay, costs were lower than 1998 levels reflecting
continued cost management.  This was achieved whilst continuing to invest in
the business, particularly in the credit and European markets and also in
new technology to improve the trading, control and processing systems.  The
ongoing investment in improving core technology and adding selectively to
develop the human resources within Barclays Capital continues to be a
priority.


Barclays Global Investors

Barclays Global Investors (BGI) is the largest institutional asset manager
in the world counting some of the world's most sophisticated investing
institutions amongst its 1,500 clients.  BGI offers advanced active and
indexed asset management services for institutional clients from offices
located in seven countries around the world.  The objective of BGI's
advanced active management service is to outperform market benchmarks by the
application of disciplined investment processes using statistical models to
test and implement investment decisions.  The objective of indexed
management is to replicate the performance of market benchmarks.  In
addition to these activities, BGI is a major lender of securities.

The global asset management industry is growing rapidly with revenues
forecasted to triple to over £500bn by 2010.  BGI continually invest in its
business to ensure it maintains its strong competitive position on this
growing market.

                                       1999             1998
                                         £m               £m
Net fees and commissions                318              277
Net interest income                       6                9
Other operating income                    -                2
Total income                            324              288
Total costs                           (281)            (236)
Operating profit                         43               52

Operating profit decreased by £9m primarily reflecting a continued
investment in a number of strategic investment programmes.  Investment in
these programmes has doubled to £28m (1998: £14m).  One area of significant
investment has been in quantitative product research and development with
the aim of achieving a greater level of active products within BGI's
business mix not just for the institutional markets but also for the
individual market place.  Another area of investment expenditure has been in
supporting the launch of a range of Exchange Traded Funds (ETFs), in the
United States and Canada.  ETFs are index funds that are bought and sold
like shares on a national exchange.  These investment programmes aim to
ensure sustained business growth in a highly competitive global market
place.

Fees and commissions increased 15% to £318m (1998: £277m), benefiting from
new business growth in assets under management and favourable market
conditions during the year.  Good growth in advanced active and securities
lending offset continued competitor pressure on margins within the index
business.  The securities lending business benefited from the introduction
of this activity to pension funds in Japan and Canada.  During 1999, BGI
announced the formation of E-Crossnet, a joint venture to cross UK and
continental European equities.

The rise in costs of £45m reflects increased investment expenditure coupled
with higher staff costs.

Total assets under management grew to £486bn from £370bn at 31st December
1998; £34bn of the increase is attributable to net new business and £82bn is
attributable to market and exchange rate translation movements.  Assets
under management consist of £384bn of indexed funds and £102bn under
advanced active management.  All geographical regions have experienced good
growth in assets.  For the second consecutive year, BGI Europe was first in
terms of the number of UK institutional client gains.


Businesses in Transition
                                       1999             1998
                                         £m               £m
                                                            
France in Transition                      -               18
United States Transition                  -               19
Other Businesses in Transition            -               11
                                          -               48
Former BZW Businesses                     -             (33)
Operating profit                          -               15

These asset portfolios have now been managed down to low levels.

France in Transition's residual assets of some £60m have been absorbed
within Retail Financial Services.  The remaining assets of United States and
Other Businesses in Transition totalling £400m are now reported centrally
within Other operations.

All former BZW businesses were sold or closed by the end of 1998.  The final
loss and associated costs of £30m have been booked in 1999 as an exceptional
item.


Other operations

Barclays Group Property Services is responsible for the management of the
Group's operational premises and property related services.

Central services includes a variety of activities which support the
operating businesses such as the central administration of certain
operational property costs and other central Group costs.

Management of Group capital is the balance of earnings on the Group's
capital remaining after allocations to business groups, based generally on
weighted risk assets.  The Group maintains hedges with respect to its
capital and its current account balances, which are designed both to reduce
the impact of short-term interest rate fluctuations on profits and to
increase profitability over the interest rate cycle.  The hedges increase
profitability when average short-term interest rates are lower than average
medium-term interest rates and depress profitability when average short-term
interest rates are higher than average medium-term interest rates.

                                       1999             1998
                                         £m               £m
Barclays Group Property Services         49               50
Central services                       (80)            (119)
Management of Group capital              44             (98)
Operating profit                         13            (167)

The fall in the Group Property Services result is primarily attributable to
reduced profits on the disposal of properties (1999: £3m, 1998: £16m) offset
by restructuring costs of £11m in 1998.

Central services net costs reduced to £80m from £119m primarily as a result
of a £22m provision in 1998 in relation to vacant leasehold premises which
arose as a result of the adoption of FRS 12 (see page 41).  There were
restructuring costs of £14m in 1998.

The surplus from the central management of Group capital, compared with the
deficit in 1998, is mainly attributable to reduced interest allocations to
business groups, reflecting lower short-term interest rates.  The basis of
allocation to the businesses remains in line with previous years.  Lower
medium-term rates have had an adverse effect on the earnings from capital
balances as have the costs of share buy-backs.  Management of Group capital
benefited from a £26m credit arising from further releases and recoveries
relating to the United States Transition and Other Businesses in Transition
portfolios which are now managed centrally.


Head office functions

Head office functions comprise the Group's central executive, Group finance,
corporate communications, human resources, internal audit operations and the
Group credit policy unit.  Group finance includes Group general counsel's
office, Group corporate secretariat and the treasury, risk management,
financial control, corporate planning, economics and taxation functions.

                                       1999             1998
                                         £m               £m
Operating cost                         (77)             (72)

Restructuring charge

                                       1999             1998
                                         £m               £m
                                                            
Staff costs                             192                -
Administrative expenses - other         152                -
                                        344                -

In May, the Group announced that in 1999 it would incur a staff and related
cost restructuring charge of up to £400m, in respect of 6,000 gross job
reductions in the United Kingdom, principally in Retail Financial Services
and Corporate Banking.  In August, plans relating to certain of Retail
Financial Services international operations were announced involving a
further 1,000 job reductions.

Gross job reductions arising from the 1999 restructuring programme were
7,000.  Net job reductions arising from the 1999 restructuring programme,
were 5,300, reflecting 1,700 staff who filled other jobs within the Group in
1999.

The staff costs charge of £192m includes an estimate of the number of staff
opting to take an enhanced pension as part of their redundancy entitlement,
the full cost of which will be borne by the pension fund surplus.  The
charge of £192m also includes the cost of a further 900 job reductions in
the first half of 2000 where the process of serving notice has already
commenced.  The reduced cost compared with the estimate of £247m made at
30th June 1999 reflects the achievement of higher than targeted job
reductions at lower than expected cost.

Administration expenses charged are mainly in respect of the expected cost
of properties which are no longer required as a result of the restructuring.
The increase in the charge from the estimate of £98m at 30th June 1999 is as
a result of additional redundant properties being identified.

Expenditure of £160m was incurred against the above charge.  It is expected
that the majority of the remaining element of £184m will be incurred in
2000.

Value Based Management

Barclays is introducing Value Based Management (VBM), the principles of
which are designed to align management decision taking at all levels of the
Group with the interests of its shareholders.  The VBM framework is designed
to identify and reward performance that maximises shareholder return.  The
basic principle is to establish a robust financial framework that provides a
consistent evaluation of the risk and return characteristics that can be
applied to all business activities.  VBM will also have a significant impact
on key processes such as strategy development, management decision taking
and performance-linked incentivisation.

Economic profit

VBM is based on the concept of economic profit - the post-tax attributable
profit generated by a business over and above the cost of capital.  A
business or activity that generates a positive economic profit creates value
for our shareholders, whereas a business that generates a negative economic
profit destroys value.  To avoid the problems of short-term optimisation of
business performance that have sometimes been associated with VBM
frameworks, the strategy and performance of business will be assessed on a
multi-year basis by discounting future projected economic profits.

Economic profit is defined as profit after tax and minority interests less a
charge for the cost of average shareholders' funds.  This is calculated
using a capital asset pricing model.  The assumptions made include estimates
of the future equity market risk premium of 4.5% and the Group's sensitivity
to changes in the value of its market portfolio (or beta), currently 1.2.

                                       1999             1998
                                         £m               £m
Profit after tax and minority         1,897            1,327
interests
                                                            
Average shareholders' funds           8,286            7,785
Post tax cost of equity                 11%              11%
Cost of average shareholders'         (911)            (856)
funds
Economic profit                         986              471

Profit after tax and minority interests excludes the charge for the write-
back of goodwill on disposals of £138m (1998: £10m).

Economic capital

Economic capital, which is distinct from regulatory capital, is a management
tool that estimates risk on the basis of the volatility of earnings around
their predicted level and therefore their contribution to overall Group
risk.  The higher the volatility and hence risk, the more capital is
required.  Capital is calculated for each business based on its contribution
to the overall risk of the Group.  The major factor affecting profit
volatility is credit risk.  The calculation also reflects market risk and
business and operational risk.

The calculation of economic capital is an integral part of the work to
introduce the VBM principles and is being further developed as part of that
process.

Risk tendency

The Group uses a grading structure to show the probability of future default
by borrowers.  This is used to estimate levels of annualised future credit
losses from the overall lending portfolio averaged across the economic cycle
(termed Risk Tendency).  Risk Tendency estimates assist in portfolio
management decisions, such as exposure limits to any single counterparty or
borrower, the desired aggregate exposure levels to individual sectors and
pricing policy.  Gradings also provide a guide to changes in the underlying
credit quality of the lending portfolio over time.  A similar structure is
also in place to control exposures to countries.

Based upon the composition of the lending portfolio as at 31st December
1999, the underlying level of risk tendency, averaged across the economic
cycle, is estimated at around £750m (31st December 1998: £700m).  Risk
tendency rose by £50m during the year reflecting overall asset growth within
Retail Financial Services, particularly within UK consumer loans and
Barclaycard.

                                       Risk             Risk
                                   Tendency         Tendency
                                   31.12.99         31.12.98
                                         £m               £m
Retail Financial Services               495              445
Corporate Banking                       210              210
Barclays Capital                         45               45
                                        750              700


                            KEY FACTS (UNAUDITED)

                                           1999        1998
RETAIL FINANCIAL SERVICES                                  
                                                           
Retail Customers                                           
Current account customers                  8.1m        7.7m
Savings account customers                  3.8m        3.5m
Small business customers                440,000     430,000
Customers registered for              1,000,000     844,000
Barclaycall
Customers registered for on-line        500,000     205,000
banking
Africa - number of countries                  9          10
represented
Africa - customer deposits               £1.6bn      £1.4bn
                                                           
                                                           
Wealth Management                                          
Premier clients                         129,000     112,000
Customers in continental Europe         307,000     301,500
Total customer funds                    £66.0bn    £58.9bn*
Stockbrokers - deal volumes per day       6,600       6,000
Caribbean - number of countries              14          14
represented
Caribbean - customer deposits            £3.1bn      £2.8bn
                                                           
Barclaycard                                                
Barclaycards in issue                     10.4m       10.0m
Number of merchant transactions           1.1bn       1.0bn
processed
                                                           
Number of UK branches                     1,899       1,950
                                                           
CORPORATE BANKING                                          
                                                           
Number of UK Corporate Banking          112,400     109,900
connections
- Mid corporate connections              96,400      94,300
- Larger business connections            13,800      13,600
- Large corporate connections             2,200       2,000
Customers registered for electronic      29,400      20,400
banking
Number of current accounts              231,000     220,000
Number of deposit accounts              102,000      97,000
                                                                            
* Excluding Merck Finck and Co which was sold on 31st March 1999.

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