Barclays 2009 Annual Report Download - page 104

Impairment Charges
Impairment charges on loans and advances increased 50% (£2,445m) to
£7,358m (2008: £4,913m). The increase was primarily due to economic
deterioration and portfolio maturation, currency movements and
methodology enhancements, partially offset by a contraction in loan
balances. As a result of this increase in impairment and the fall in loans
and advances, the impairment charges as a percentage of period end
Group total loans and advances (loan loss rate) increased to 156bps
(31st December 2008: 95bps). When measured against constant 2008
year-end loans and advances balances and impairment at average 2008
foreign exchange rates, the loan loss rate for the period was 135bps.
The impairment charge in Global Retail and Commercial Banking
increased by 85% (£2,473m) to £5,395m (2008: £2,922m) as charges rose
in all portfolios, reflecting deteriorating credit conditions across all regions.
The loan loss rate for 2009 was 185bps (2008: 99bps).
In Investment Banking and Investment Management, impairment
was broadly unchanged at £1,949m (2008: £1,980m). The loan loss rate
for 2009 was 109bps (2008: 90bps).
The impairment charge against available for sale assets and reverse
repurchase agreements increased by 41% (£207m) to £713m (2008: £506m),
driven by impairment against credit market exposures.
102 Barclays PLC Annual Report 2009 www.barclays.com/annualreport09
Risk management
Credit risk management
continued
Impairment Charges by Business Reverse
Loans and Available for repurchase
advances sale assets agreements Total
£m £m £m £m
Year Ended 31.12.2009
Global Retail and Commercial Banking 5,395 18 – 5,413
UK Retail Banking 936 – – 936
Barclays Commercial Bank 960 14 – 974
Barclaycard 1,798 – – 1,798
GRCB – Western Europe 663 4 – 667
GRCB – Emerging Markets 471 – – 471
GRCB – Absa 567 – – 567
Investment Banking and Investment Management 1,949 650 43 2,642
Barclays Capitala1,898 650 43 2,591
Barclays Wealth 51 – – 51
Head Office Functions and Other Operations 14 2 – 16
Total Impairment charges 7,358 670 43 8,071
Year Ended 31.12.2008
Global Retail and Commercial Banking 2,922 – – 2,922
UK Retail Banking 602 – – 602
Barclays Commercial Bank 414 – – 414
Barclaycard 1,097 – – 1,097
GRCB – Western Europe 297 – – 297
GRCB – Emerging Markets 165 – – 165
GRCB – Absa 347 – – 347
Investment Banking and Investment Management 1,980 363 124 2,467
Barclays Capitala1,936 363 124 2,423
Barclays Wealth 44 – – 44
Head Office Functions and Other Operations 11 19 – 30
Total Impairment charges 4,913 382 124 5,419
Impairment Charges and Other Credit Provisions Ye ar Year
Ended Ended
31.12.09 31.12.08
£m £m
Impairment charges on loans and advances 7,330 4,584
Charges in respect of undrawn facilities and guarantees 28 329
Impairment charges on loans and advances 7,358 4,913
Impairment charges on reverse repurchase agreements 43 124
Impairment charges on available for sale assets 670 382
Impairment charges and other credit provisions 8,071 5,419
Note
aCredit market related impairment charges within Barclays Capital comprised £1,205m
(2008: £1,517m) against loans and advances, £464m (2008: £192m) against available for
sale assets and £nil (2008: £54m) against reverse repurchase agreements.