Interim Results - Part 3

BARCLAYS PLC
5 August 1999

PART 3

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.

                                      Half-year ended
                                  30.6.99   31.12.98   30.6.98
                                       £m        £m        £m
Net interest income                 1,466     1,445     1,386
Net fees and commissions              861       868       830
Income from long-term assurance        18        62        47
business
Other operating income                 64        42        20
Total income *                      2,409     2,417     2,283
Total costs                       (1,349)   (1,438)   (1,371)
Provisions for bad and doubtful     (240)     (199)     (191)
debts
Operating profit                      820       780       721

*Half year ended 30th June 1999 includes a £40m provision
 for possible redress to personal pension customers (non-
 priority cases).

Retail Financial Services produced a strong performance with
a 14% increase in operating profit to £820m over the first
half of 1998.

Net interest income increased by £80m, or 6% to £1,466m,
primarily as a result of strong growth in UK consumer
lending and extended credit balances at Barclaycard,
continued improvement in mortgage lending and further growth
in average UK savings balances.  This was partially offset
by a reduced contribution from non-interest bearing
liabilities as a result of lower interest rates.  UK margins
were maintained, with a growth in overall asset margins
being offset by a fall in overall liability margins.

Net fees and commissions grew by 4%, to £861m, predominantly
in the European Retail Banking, Private Banking and Offshore
Services businesses within Wealth Management.  This is
despite a £33m reduced contribution from Barclays Insurance
following the move to in-house underwriting of all payment
protection insurance.  In-house underwriting income is
included in Other operating income and is the main reason
for the increase to £64m over the first half of 1998.

Total customer funds, which include assets under management
and on-balance sheet deposits, grew £4bn or 4%, to £111bn
(31st December 1998: £107bn, excluding the Merck Finck
business which was sold on 31st March 1999).  Assets under
management increased by £3bn to £50bn, of which around half
was attributable to net new business and half to market
movements after excluding the Merck Finck business.  Loans
to customers rose 3% to £38bn (31st December 1998: £37bn).

Total costs were lower than the first half of 1998 despite
continued investment in technology, emerging delivery
channels and higher business volumes.  Operational
efficiencies from past investments, particularly the on-
going centralisation of back office processing and the
development of shared service capabilities such as call
centres, have contributed to this cost reduction.
                        
Total staff costs (excluding redundancy and relocation
costs) were maintained at the same level as the first six
months of 1998.  In May a programme of UK job reductions was
announced, of which the majority are anticipated in Retail
Financial Services and will occur by the end of 1999.  This
will be partially offset by an additional 1,800 jobs being
created primarily in call centres.

Provisions rose by £49m to £240m (1998: £191m).  This was
primarily attributable to the volume growth in UK consumer
lending and extended credit balances in Barclaycard and to a
lesser extent reflects less favourable UK economic factors.
Within the rest of Europe, Africa and the Caribbean
provisions remained at low levels.

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

Analysis of Retail Financial Services operating profit

                                      Half-year ended
                                  30.6.99   31.12.98   30.6.98
                                       £m        £m        £m
Retail customers*                     403       441       398
Wealth Management                     221       169       155
Barclaycard                           196       170       168
Operating profit                      820       780       721

*Half year ended 30th June 1999 includes a £40m provision
 for possible redress for personal pension customers (non-
 priority cases).

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 1%.
Excluding a further £40m provision for the possible redress
to personal pension policy holders (non-priority cases),
profit rose 11%.  This increase was primarily attributable
to continued growth in consumer lending, savings and
mortgage balances.

UK Personal Customers
Consumer lending balances increased by 4% in the first half
of 1999 to £6.0bn (31st December 1998: £5.7bn).  Average
balances grew by 13% year-on-year to £5.9bn with consumer
lending margins maintained despite continued competitive
pressure.

Average UK mortgage outstandings grew by 5% year-on-year
with a continued improvement in margins.  The cost of
incentives reduced to £10m (1998: £11m).  Gross new mortgage
lending increased by 47% to £2.1bn compared to the same
period in 1998.  Fixed and capped rate mortgages account for
two-thirds of new business and 40% of overall balances
compared to 60% and 30% respectively for the first half of
last year.

Average UK personal savings balances rose by 9% to £19.4bn
compared to the first half of 1998 reflecting a continued
focus on providing a portfolio of savings products, tailored
to the customers' individual requirements.  Although
competitive pressure remains high, overall savings margins
were maintained.
                        
The number of UK personal current accounts increased by 3%
to 8 million in the first half of the year.  This is partly
attributable to the introduction of Instant Banking, a
market leading initiative launched at the end of 1998, and
to the continuing success of Barclays Additions.  The total
number of customers using this fee-based current account
rose to over 750,000 (31st December 1998: 645,000).  The
launch in April of Barclays.net, the first free 'internet
service provider' to be offered by a UK bank, led to an
increased demand for on-line banking.  Since the launch,
10,000 customers per week have taken up the on-line service,
bringing the total of on-line and telephone banking
customers to 1.1 million.

Sales of unit trusts, managed portfolios, and individual
life and pension products grew by 28% (in API terms) in the
first six months of 1999.  In particular, sales of
investment products rose by 59% benefiting in part from a
promotion to coincide with the last opportunity to invest in
Personal Equity Plans (PEPs) and the launch of Individual
Savings Accounts (ISAs).

Assets under management within Barclays Funds (which
includes b2) increased 9% to £6.7bn in the first half of the
year.  Income increased by 9% over the first half of 1998.
b2 increased its range of product offerings to include a
range of ISA products.

Barclays Insurance's income increased reflecting the success
of the new product campaigns and a new range of payment
protection policies.

UK Small Business Customers
Operating profit in small business increased by 23%.  Total
income from UK Small Business was maintained at first half
1998 levels.  Interest income was marginally lower
reflecting a reduced contribution from current accounts as a
result of falling interest rates.  There has been good
growth in lending volumes to £1.6bn since the end of last
year.  Fees and commissions improved slightly, reflecting
increased transaction volumes and unchanged commission
tariffs.  Total costs were lower than in the first half of
1998.  Provisions reduced compared to the first half of 1998
as a result of a continued improvement in asset quality
following the introduction of a standardised risk management
process.  Over 40,000 small business customers now use the
on-line banking service, supplementing an existing telephone
banking service that has recently become 24 hour and now has
170,000 registered customers.

Africa
Operating profit in the African business improved by 21% to
£41m, benefiting from increased focus on product innovation
and use of technology.  There were particularly strong
performances from our operations in Zimbabwe, Ghana and
Zambia.  In Kenya the economic environment, which resulted
in lower interest rates, impacted adversely upon income.
However, the core business remains strong and there is
recent evidence of some economic improvement.

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, Stockbrokers and the Caribbean.
                                                           
Operating profit in Wealth Management rose 43% to £221m,
predominantly driven by strong growth in Private Banking,
Offshore Services and the European retail areas.

Total income grew by 15% with increased contributions from
all businesses.  There was particularly good income growth
in the Caribbean (up 15% to £62m), Private Banking (up 17%
to £76m), Stockbrokers (up 22% to £66m), Offshore Services
(up 17% to £112m) and the European Retail Banking Group
(restated for the Merck Finck sale, up 13% to £147m).
Growth in total income across the Wealth Management
businesses benefited from an increase in assets under
management of £2bn, or 5%, to £38bn in the first half of
1999 (restated for the Merck Finck sale).

Growth in UK Premier operating profits benefited from a 13%
increase in customer numbers to 127,000 (31st December 1998:
112,000).  Costs were held at 1998 levels and this, combined
with increased salesforce productivity, sharply improved
profitability per client.

European Retail Banking Group performed well, with strong
income growth in each country assisted by buoyant stock
markets and continued successful targeting of affluent and
high net worth individuals.  This growth has been reinforced
with 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 5% to £23m aided by an improved
performance from the strong offshore market and the
establishment of Barclaycall customer service units
offshore.

In Offshore Services operating profit rose 23%, reflecting a
4% growth in customer deposits and improved margins.

Total income at Private Banking grew by 17%, reflecting
increased business levels, favourable market conditions and
investment in client facing staff.  Clients' funds were
£22bn as at 30th June 1999, an increase of 4% compared to
the end of last year.

Stockbrokers' operating profit improved strongly as a result
of good growth in investment management income and increased
dealing activity.  In March, Barclays Stockbrokers became
the first UK broker to launch an on-line internet based
dealing service together with its proprietary Price
ImproverTM, an automated facility which scans prices offered
to select the best price available for the customer.

Overall costs in Wealth Management increased by 6%.  This
reflected the increased investment in front line staff and
IT infrastructure to support business growth, and a
substantial increase in transaction volumes.  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.

Operating profits increased by 17% to £196m compared to the
same period last year.  Average extended credit balances
continued to grow strongly, increasing 15% over the first
half of 1998.  This growth was supported by further
improvements to the product package including the
introduction of a new rewards scheme, free extended warranty
and the launch of a new platinum card.

Net interest margins remained at similar levels to the first
half of 1998 although a slight improvement was seen on the
second half of 1998 reflecting an increase in interest
earning balances as a proportion of total outstandings.
                                                            
Fees and commissions increased by 3%, as transaction growth
was offset by an increase in the number of account fees
refunded to customers and a slight contraction in merchant
acquisition fee margins.

Total costs fell by 2% as cost savings from the change
programme announced in September 1998 began to take effect.
Investment continued in Barclaycard's international
business, including the launch of a credit card in Spain
during the first half of 1999.

Provisions for bad and doubtful debts increased by 15%
compared to the same period last year, primarily reflecting
volume growth in extended credit balances.  The credit
quality of outstanding balances has been maintained through
a combination of robust initial assessment and ongoing
credit management.
    
Corporate Banking
Corporate Banking provides relationship banking to the
Group's middle market and large corporate customers.  An
extensive network of specialist business centres in the
United Kingdom as well as offices in continental Europe, the
United States and the Middle East, serves both corporate and
institutional customers.  In addition, an office in Miami
provides trade finance and correspondent banking services to
the Group's Latin America customers.  As well as the full
range of conventional banking services, Corporate Banking
provides foreign exchange and hedging products, factoring
and invoice discounting, asset backed financing and contract
hire.  Corporate Banking's close working relationship with
Barclays Capital ensures larger corporate customers have
integrated access to the capital markets in addition to more
traditional bank financing.

Corporate Banking's European reach has been supported by the
launch of a full range of euro products, including current
and deposit accounts, euro denominated overdrafts and loan
products, leasing and sales financing.  Following a highly
successful euro conversion programme, the Group is one of
the top ten cross-border euro payment banks with 5% of the
euro payment market by value.

                                      Half-year ended
                                  30.6.99   31.12.98   30.6.98
                                       £m        £m        £m
Net interest income                   610       613       601
Net fees and commissions              328       313       300
Other operating income                  5        11        13
Total income                          943       937       914
Total costs                         (420)     (448)     (414)
Provisions for bad and doubtful      (65)      (42)        44
debts
Operating profit before impact of     458       447       544
Finance Acts
Write-down of leases                    -         -      (40)
Operating profit                      458       447       504

Corporate Banking produced a good underlying performance.
Although operating profit reduced by £86m to £458m before
the impact of a £40m write-down of lease receivables in the
first half of 1998, this resulted from a £109m year-on-year
increase in the net provision charge.  Provisions for bad
and doubtful debts increased to £65m (1998 net credit: £44m)
mainly as a result of lower levels of credit risk releases
and recoveries of £37m (1998: £96m).  New and increased
provisions were higher than the low levels experienced in
the first six months of 1998, but remained at a similar
level to the second half of last year (excluding Russian
provisions of £23m).

Net interest income rose 1% over the first half of 1998.
After adjusting for a £16m realisation from a debt
previously written off in the first half of last year, net
interest income increased by 4%.

Average customer lending balances increased by 10% compared
to the first half of 1998, reflecting good loan growth in
all business areas.  Large corporate lending has benefited
from increased acquisition finance activity, although growth
has slowed since the second half of 1998.  Average UK middle
market lending has grown by 10% year on year predominantly
to the larger and higher quality corporate customers.
Lending volumes in the international businesses have
increased by 14% although this has also slowed compared to
the second half of 1998.  In the first half of 1999, growth
in lending volumes is predominantly in Europe.  UK lending
margins continued to reduce slightly reflecting the improved
quality of the lending portfolio.  Overseas lending margins
have widened compared to the same period last year, as a
result of the switch to traditional bank lending from debt
capital markets in the second half of last year.  Adjusting
for expected credit losses, the overall lending margin was
at a similar level to the first and second halves of 1998.
                                                           
Average UK deposit volumes were 11% higher year-on-year
although the growth rate has slowed in the first half of
1999, reflecting some contraction in UK corporate liquidity.
The overall liability margin reduced slightly against the
first and second halves of 1998, reflecting stronger growth
in the lower margin Treasury deposits and the impact of
falling interest rates.

Net fees and commissions rose by 9% as a result of good
growth in lending related fees and foreign exchange related
income.  These improvements reflect a higher volume of
arrangement fees in respect of on and off-balance sheet
financing products and continued benefit from the new
foreign exchange pricing policy introduced in the second
half of 1998.  Money transmission income was at similar
levels to the first half of 1998.  Continued growth in sales
of electronic products has resulted in over 22% of corporate
customers using electronic banking products.

Other operating income declined compared to the first half
of 1998 reflecting a reduced contribution from the Group's
associated undertaking, Banco Barclays e Galicia.

Costs increased slightly compared to the first half of 1998
although they were lower than the second half of last year.
The small rise mainly reflects an increase in staff costs as
a result of the annual pay award.  Corporate Banking
continues to invest in a range of initiatives to improve the
sales management approach, develop new products and improve
operational efficiencies.  The majority of the benefit from
the 1999 restructuring programme is not expected to be
realised until 2000.

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's broader business strategy.  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 in two
principal areas: Rates which includes 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 including foreign exchange and interest rate
hedging instruments to all of the Group's businesses and
their customers.  It also provides a counterbalance to
disintermediation of the traditional corporate lending
businesses.

                                      Half-year ended
                                  30.6.99   31.12.98   30.6.98
                                       £m        £m        £m
Net interest income                   201       226       191
Dealing profits                       319     (233)       204
Net fees and commissions               83        84        75
Other operating income                 21        12        32
Total income                          624        89       502
Total costs                         (423)     (363)     (338)
Provisions for bad and doubtful      (23)     (152)       (8)
debts
Operating profit                      178     (426)       156

Operating profit increased by 14%, or £22m, to £178m.  This
also represents a £604m improvement in performance compared
to a £426m operating loss for the second half of 1998 which
resulted from the Russian economic crisis and the subsequent
dislocation in the world credit markets.  Both the Rates and
Credit businesses performed well in an overall favourable
trading environment during the first half of 1999.

Dealing profits increased by 56%, or £115m, to £319m
compared with the first six months of 1998.  This was
achieved while operating at lower levels of risk compared to
last year.  Average daily value-at-risk utilisation reduced
by 35% to £13.0m (first half 1998: £20.1m, second half 1998:
£21.7m).  In the Rates business there was strong growth in
foreign exchange and government bond sales and trading, and
interest rate derivatives performed strongly.  The secondary
corporate bond business made a good contribution as a result
of focusing on increased customer related business with
higher inventory turnover.

Net interest income increased by £10m over the first half of
1998.  The money market business made a significantly
increased contribution benefiting from the downward movement
in UK interest rates.  This was offset by lower interest
earned from reduced regulatory capital employed.

Fees and commissions improved by £8m, or 11%, to £83m
reflecting strong growth in fees earned in the primary
corporate bond business and a similar level of loan
arrangement fees to the first half of last year.  This
increase was offset by lower revenues in the futures
business as a result of continued pricing pressures.

Barclays Capital maintained a leading position in sterling
bond issuance.  The new euro bond market was intensely
competitive in the first half of 1999, however good progress
was made with new issues for Abbey National, Kingdom of
Belgium and Carrefour.  Barclays Capital also maintained its
leading position in the European syndicated loan market.

Other operating income consists principally of realisations
from private equity investments.  There was a good
contribution during the first half of 1999 which included
the first significant contribution from continental Europe.

Costs were higher than both the first and second half of
1998.  This reflected a higher level of performance related
pay in line with improved profitability.

Excluding performance related expenditure, costs fell
marginally over the second half of 1998 but are higher than
the first half of last year reflecting the absorption of
fixed costs previously allocated to the former BZW
businesses up until the sale completion in April 1998.
Technology development and related support costs remain at a
high level as the Year 2000 programme nears completion.  The
replacement and upgrade of settlement, risk and financial
systems continues to be a priority.

Barclays Global Investors

Barclays Global Investors (BGI) is the world's largest
institutional investment firm and offers advanced active and
indexed asset management services.  The objective of
advanced active management is to outperform market
benchmarks by the application of disciplined investment
processes.  The objective of indexed management is to
replicate the performance of market benchmarks.  In
addition, BGI is a major lender of securities which provides
added value by improving client performance.  BGI's
activities are carried out from twelve offices located in
seven countries.

                                      Half-year ended
                                  30.6.99   31.12.98   30.6.98
                                       £m        £m        £m
Net fees and commissions              152       140       137
Net interest income                     3         3         6
Other operating income                  -       (1)         3
Total income                          155       142       146
Total costs                         (127)     (119)     (117)
Operating profit                       28        23        29

Operating profit declined to £28m (1998: £29m) as a result
of an increase in investment expenditure.

Net fees and commissions increased by 11% to £152m,
benefiting from favourable market conditions and a good
level of net new business growth in assets under management.
The overall income margin was maintained as a result of
increased revenues in the securities lending business
resulting from the growth in assets under management.

Total assets under management grew by £64bn to £434bn from
£370bn at 31st December 1998, of which £12bn is attributable
to net new business and £52bn to market growth.  Assets
under management comprise £343bn of indexed funds and £91bn
under advanced active management.  BGI continues to win new
mandates particularly in Europe, despite very competitive
conditions in the institutional index market.  The UK
advanced active product group has outperformed its benchmark
and this good relative performance, together with a trend
towards more quantitative fund management in Europe, have
contributed to the growth in new business.

All BGI's individual businesses have performed well in 1999.
Europe, North America and Japan continued their strong
performance of last year.

Total costs grew by 9%, mainly as a result of an £8m rise in
costs in respect of a number of strategic investment
programmes.  These are designed to enhance the underlying
operations and sustain growth in the increasingly
competitive global market place of index and advanced active
fund management.  This investment includes the development
of new advanced active and index products and expanded
channels of distribution to serve BGI's global client base.

Businesses in Transition

                                      Half-year ended
                                  30.6.99   31.12.98   30.6.98
                                       £m        £m        £m
                                                             
France in Transition                    -        16         2
United States Transition                -       (4)        23
Other Businesses in Transition          -        12       (1)
                                        -        24        24
Former BZW Businesses                   -      (14)      (19)
Operating profit                        -        10         5

These asset portfolios have now been managed down to low
levels and are unlikely to result in significant releases
and recoveries in the future.

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.
                        
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 information
technology, 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.

                                      Half-year ended
                                  30.6.99   31.12.98   30.6.98
                                       £m        £m        £m
Barclays Group Property Services       21        24        26
Central services                     (42)      (96)      (59)
Management of Group capital             9      (39)      (59)
Operating profit                     (12)     (111)      (92)

The fall in the Group Property Services result is mainly
attributable to reduced profits on the disposal of
properties (1999: £nil, 1998: £9m).  Restructuring costs of
£6m were incurred in the first half of 1998.

Central services net costs reduced to £42m from £59m
reflecting lower investment expenditure and restructuring
costs, partially offset by reduced profits on disposal of
properties of £4m (1998: £7m).  In the second half of 1998,
Central services included a £24m provision in relation to
vacant leasehold premises which arose as a result of the
adoption of FRS 12 (see page 38).

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.  This 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.

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, the Group corporate secretariat and the treasury,
risk management, financial control, economics and taxation
functions.

                                      Half-year ended
                                  30.6.99   31.12.98   30.6.98
                                       £m        £m        £m
Operating cost                       (32)      (35)      (25)

The increase in costs is mainly the result of our brand
building programme, a comprehensive Group wide initiative
designed to improve our customers experience with Barclays.


Restructuring charge

                                      Half-year ended
                                  30.6.99   31.12.98   30.6.98
                                       £m        £m        £m
                                                             
Staff costs                           247         -         -
Administrative expenses - other        98         -         -
                                      345         -         -

In May, the Group announced that in 1999 it would incur a
staff and related restructuring charge of up to £400m, in
respect of 6,000 job losses in the UK, principally in Retail
Financial Services and Corporate Banking.

The estimated restructuring charge relating to the 6,000
jobs for 1999 has been taken in the first half of the year.
The charge is now £300m, based on 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.  Further plans relating to
certain of Retail Financial Services' international
operations have resulted in an additional estimated
restructuring charge of £45m.  This involves a further 1,000
job losses outside the United Kingdom.

Overall annual gross cost savings in respect of these plans
are now expected to be in excess of £200m.

In the first half of 1999, expenditure of £45m was incurred
against the above charge.
                              
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.  The
higher the volatility, 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 Group uses annualised return on economic capital as a
key measure of business performance for capital intensive
businesses.  In the calculation, profit reflects the benefit
of economic capital, an appropriate allocation of the Group
tax charge and is adjusted for the level of risk tendency.

The Group's stated range of capital is £6.6bn to £7.0bn.
The difference between this range and the sum of the figures
below includes capital allocated to other operations
(including the Group owned property portfolio and Businesses
in Transition) and allows for future growth.

                     Return on              Return on            
                      economic   Economic   economic    Economic
                       capital    capital    Capital  *  capital
                       30.6.99    30.6.99   31.12.98    31.12.98
                             %         £m          %          £m
Retail Financial            47      2,700         45       2,550
Services
Corporate Banking           33      1,900         27 **    1,900
Barclays Capital            26        850       (35)         850
Barclays Global            N/A         50        N/A          50
Investors

*For the full year 1998.
**    Before the impact of the 1998 Finance Act.  Adjusting
 for this, the return for Corporate Banking was 26%.

Risk tendency

The Group uses a corporate grading structure which shows the
probability of future default by the borrower.  This,
together with similar risk calibration of categories of
personal sector lendings, 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 and also
provide a guide to changes in the underlying credit quality
of the lending portfolio over time.

Based upon the composition of the lending portfolio as at
30th June 1999, the underlying level of risk tendency,
averaged across the economic cycle, is estimated at around
£725m (31st December 1998: £700m).  Risk tendency rose by
£25m during the first half of the year as a result of
increased volumes in UK consumer lending and extended credit
balances at Barclaycard.

The steady growth in UK corporate lending to higher quality
customers has resulted in Corporate Banking's risk tendency
being maintained at last year's level.

                                            Risk Tendency
                                                                 
                                    30.6.99   31.12.98    30.6.98
                                         £m         £m         £m
Retail Financial                        470        445        450
Services
Corporate Banking                       210        210        210
Barclays Capital                         45         45         40
                                        725        700        700
                              
             ADDITIONAL INFORMATION (UNAUDITED)
                              
                          KEY FACTS
                              
                                      Half-year ended
                                    30.6.99 31.12.98 30.6.98
                                                            
RETAIL FINANCIAL SERVICES                                   
                                                            
Retail Customers                                            
Number of current accounts             8.0m     7.7m    7.5m
Customers registered for            773,000  702,000 654,000
Barclaycall - UK Personal
Customers registered for            170,000  142,000 100,000
Barclaycall - UK Small Business
Customers registered for on-line    342,000  205,000  43,000
banking
Small business customers            440,000  430,000 421,000
Number of savings accounts             3.7m     3.5m    3.4m
Africa - number of countries             10       10      10
represented
Africa - customer deposits           £1.5bn   £1.4bn  £1.4bn
                                                            
Wealth Management                                           
Premier clients                     127,000  112,000  95,200
ERBG - number of customers          304,100  301,500 297,500
Total customer funds                £61.2bn £58.9bn* £54.9bn*
Stockbrokers - deal volumes per day   6,400    6,000   6,000
Caribbean - number of countries          14       14      14
represented
Caribbean - customer deposits        £3.0bn   £2.8bn  £2.6bn
                                                            
Barclaycard                                                 
Barclaycards in issue                   10m      10m     10m
Number of merchant transactions        500m     500m    450m
processed
                                                            
Number of UK branches                 1,945    1,950   1,960
                                                            
CORPORATE BANKING                                           
                                                            
Number of UK Corporate Banking      111,500  109,900 109,000
connections
- Mid corporate connections          95,600   94,300  93,700
- Larger business connections        13,800   13,600  13,300
- Large corporate connections         2,100    2,000   2,000
Customers registered for electronic  24,900   20,400  14,700
banking
Number of current accounts          226,000  220,000 218,000
Number of deposit accounts          100,000   97,000  94,000
                                                            
*Excluding Merck Finck which was sold on 31st March 1999.


MORE TO FOLLOW

IRCBIGBIGGGCCCS