Barclays 2009 Annual Report Download - page 45

www.barclays.com/annualreport09 Barclays PLC Annual Report 2009 43
2008/07
Total assets increased 67% to £2,053.0bn (2007: £1,227.4bn).
Risk weighted assets increased 22% to £433.3bn (2007: £353.9bn).
UK Retail Banking total assets increased 15% to £101.4bn (2007:
£88.5bn) driven by growth in mortgage balances. Risk weighted assets
decreased 3% to £30.5bn (2007: £31.5bn) as lending growth mainly in
high quality, low risk mortgages was more than offset in capital terms by
active risk management.
Barclays Commercial Bank total assets grew 13% to £84.0bn
(2007: £74.6bn) driven by higher loans and advances. Risk weighted
assets increased 11% to £63.1bn (2007: £57.0bn). This was slightly lower
than asset growth, reflecting a relative increase in lower risk portfolios.
Barclaycard total assets increased 40% to £30.9bn ( 2007: £22.1bn)
reflecting increases in International assets, the acquisition of Goldfish and
the appreciation of the Euro and US Dollar against Sterling. Risk weighted
assets increased 35% to £27.3bn ( 2007: £20.2bn), driven by acquisitions,
the redemption of securitisation deals and exposure growth predominantly
in the US.
GRCB – Western Europe total assets grew 50% to £65.5bn
(2007: £43.7bn) reflecting growth in retail mortgages, unsecured lending,
commercial lending and a 31% appreciation over the year in the value of
the Euro against Sterling. Risk weighted assets increased 48% to £37bn
(2007: £25.0bn), primarily reflecting underlying lending growth and the
appreciation of the Euro.
GRCB – Emerging Markets total assets grew 51% to £13.9bn
(2007: £9.2bn) reflecting increases in retail and commercial lending
combined with the impact of Sterling depreciation. Risk weighted assets
increased 39% to £14.6bn (2007: £10.5bn), reflecting portfolio growth.
GRCB – Absa total assets increased 11% to £40.4bn (2007: £36.4bn)
reflecting broad based asset growth. Risk weighted assets increased 6% to
£18.8bn (2007: £17.8bn), reflecting balance sheet growth.
Barclays Capital total assets increased 94% (£789.2bn) to £1,629.1bn
(2007: £839.9bn) due to an increase in derivative assets of £736.7bn,
predominantly driven by significant volatility and movements in yield curves
in 2008, together with a substantial depreciation in Sterling against most
major currencies. Total assets excluding derivatives increased by 9% in
Sterling. On a constant currency basis, total assets excluding derivatives
decreased by approximately 15%. Risk weighted assets increased 28% to
£227.4bn (2007: £178.2bn). This was driven by the depreciation in Sterling
against the US Dollar and Euro, and an increase in market volatility.
The total assets of our former business, Barclays Global Investors,
decreased 20% to £71.3bn (2007: £89.2bn), mainly attributable to adverse
market movements in certain asset management products recognised as
investment contracts. Risk weighted assets decreased 11% to £3.9bn (2007:
£4.4bn) mainly attributed to changes in the asset class mix, partially offset by
the weakening of Sterling against other currencies.
Barclays Wealth total assets decreased 27% to £13.3bn (2007: £18.2bn)
reflecting the sale of the closed life assurance business partially offset by
strong growth in lending to high net worth and intermediary clients. Risk
weighted assets increased 26% to £10.3bn (2007: £8.2bn) reflecting strong
growth in lending.
Head office functions and other operations total assets decreased 46% to
£3.1bn (2007: £5.7bn). Risk weighted assets decreased 64% to £0.4bn (2007:
£1.1bn). The decrease in the year was mainly attributable to the increased
netting of Group deferred tax assets and liabilities.
Adjusted gross leverage
2009/08
The adjusted gross leverage ratio is defined as the multiple of adjusted total
tangible assets over total qualifying Tier 1 capital.
Limited netting is permitted under IFRS, even for receivables and
payables with the same counterparty where there are contractually agreed
netting arrangements. Derivative assets and liabilities would be £374bn
(2008: £917bn) lower than reported under IFRS if netting were permitted
for assets and liabilities with the same counterparty or for which we hold
cash collateral.
Assets and liabilities also include amounts held under investment
contracts with third parties of a further £2bn as at 31st December 2009
(2008: £69bn). These constitute asset management products offered to
institutional pension funds which are required to be recognised as financial
instruments. Changes in value in these assets are entirely to the account of
the beneficial owner of the asset.
Adjusted gross leverage 2009 2008 2007
£m £m £m
Total assets 1,378,929 2,052,980 1,227,361
Counterparty net/
collateralised derivatives (374,099) (917,074) (215,485)
Financial assets designated at
fair value and associated cash
balances – held in respect of
linked liabilities to customers
under investment contracts (1,679) (69,183) (92,639)
Net settlement balances (25,825) (29,786) (22,459)
Goodwill and intangible assets (8,795)
(10,402) (8,296)
Adjusted total tangible assets 968,531 1,026,535 888,482
Total qualifying Tier 1 capital 49,637 37,250 26,743
Adjusted gross leverage 20 28 33