Barclays 2009 Annual Report Download - page 237

www.barclays.com/annualreport09 Barclays PLC Annual Report 2009 235
27 Subordinated liabilities continued
The 7.4% Subordinated Notes 2009 (the ‘7.4% Notes’) issued by the Bank were registered under the US Securities Act of 1933. All other issues of dated
loan capital by the Bank, Barclays Spain, BBG, BBB, Barclays Zambia, Barclays Kenya and Absa, which were made in non-US markets, have not been so
registered.
Repayment terms
Unless otherwise indicated, the Group’s dated loan capital outstanding at 31st December 2009 is redeemable only on maturity, subject in particular cases,
to provisions allowing an early redemption in the event of certain changes in tax law or, in the case of BBB and Barclays Zambia, to certain changes in
legislation or regulations.
Any repayments prior to maturity require, in the case of the Bank, the prior notification to the FSA, in the case of BBB, the prior approval of the Bank of
Botswana, in the case of Barclays Zambia, the prior approval of the Bank of Zambia, and in the case of Absa, the prior approval of the South African Registrar
of Banks.
There are no committed facilities in existence at the balance sheet date which permit the refinancing of debt beyond the date of maturity.
28 Provisions
Undrawn
contractually
committed
facilities
Redundancy and
Onerous and re- guarantees Sundry
contracts structuring provided provisions Total
£m £m £m £m £m
At 1st January 2009 50 118 109 258 535
Acquisitions and disposals of subsidiaries – (2) 1 (6) (7)
Exchange and other adjustments –42–6
Additions 51 269 119 125 564
Amounts used (27) (201) (21) (142) (391)
Unused amounts reversed (8) (26) (48) (37) (119)
Amortisation of discount 2–––2
At 31st December 2009 68 162 162 198 590
At 1st January 2008 64 82 475 209 830
Acquisitions and disposals of subsidiaries 9 (9) – (1) (1)
Exchange and other adjustments 2 – 63 15 80
Additions 12 269 461 102 844
Amounts used (41) (213) (794) (42) (1,090)
Unused amounts reversed – (11) (96) (25) (132)
Amortisation of discount 4 – – – 4
At 31st December 2008 50 118 109 258 535
Provisions expected to be recovered or settled within no more than 12 months after 31st December 2009 were £466m (2008: £333m).
Sundry provisions are made with respect to commission clawbacks, warranties and litigation claims.
29 Securitisations
The Group was party to securitisation transactions involving its residential mortgage loans, business loans and credit card balances. In addition,
the Group acts as a conduit for commercial paper, whereby it acquires static pools of residential mortgage loans from other lending institutions for
securitisation transactions.
In these transactions, the assets, or interests in the assets, or beneficial interests in the cash flows arising from the assets, are transferred to a special
purpose entity, or to a trust which then transfers its beneficial interests to a special purpose entity, which then issues floating rate debt securities to
third-party investors.
Securitisations may, depending on the individual arrangement, result in continued recognition of the securitised assets and the recognition of the debt
securities issued in the transaction; lead to partial continued recognition of the assets to the extent of the Group’s continuing involvement in those assets
or to derecognition of the assets and the separate recognition, as assets or liabilities, of any rights and obligations created or retained in the transfer. Full
derecognition only occurs when the Group transfers both its contractual right to receive cash flows from the financial assets, or retains the contractual
rights to receive the cash flows, but assumes a contractual obligation to pay the cash flows to another party without material delay or reinvestment, and
also transfers substantially all the risks and rewards of ownership, including credit risk, prepayment risk and interest rate risk.