Barclays 2011 Annual Report Download - page 106

Credit quality of loans and advances (audited)
All loans and advances are categorised as neither past due nor impaired, past due but not impaired, or impaired. Impaired loans include restructured
loans. For the purposes of these disclosures:
– A loan is considered past due when the borrower has failed to make a payment when due under the terms of the loan contract;
– The impairment allowance includes allowances both against financial assets that have been individually impaired and those subject to collective
impairment;
– Loans neither past due nor impaired consist predominantly of wholesale and retail loans that are performing. These loans, although unimpaired,
may carry an unidentified impairment allowance;
– Loans that are past due but not impaired consist predominantly of wholesale loans that are past due but individually assessed as not being impaired.
These loans, although individually assessed as unimpaired, may carry an unidentified impairment allowance;
– Impaired loans that are individually assessed for impairment consist predominantly of wholesale loans that are past due and for which an individual
allowance has been raised; and
– Impaired loans that are collectively assessed for impairment consist predominantly of retail loans that are 1 day or more past due for which a
collective allowance is raised. Wholesale loans that are past due, individually assessed as unimpaired, but which carry an unidentified impairment
allowance, are excluded from this category. (Refer to pages 89 to 91 for further detail on the Group’s impairment policy.)
Home loans and credit cards, unsecured and other retail lending are subject to forbearance in the retail portfolios and are included in the collectively
assessed impaired loans column in the table below. Included within wholesale loans that are neither past due nor impaired are a portion of loans that
have been subject to forbearance or similar strategies as part of the Group’s ongoing relationship with customers. The loans will have an internal rating
reflective of the level of risk to which the Group is exposed, bearing in mind the circumstances of the forbearance and the overall performance and
prospects of the customer. Loans on forbearance programmes will typically, but not always, attract a higher risk rating than similar loans which are not.
A portion of wholesale loans under forbearance is included in the past due but not impaired column, although not all loans subject to forbearance are
necessarily impaired or past due. Where wholesale loans under forbearance have been impaired, these form part of individually assessed impaired loans.
Loans and advances (audited)
Neither
past due
nor
impaireda
£m
Past due
but not
impairedb
£m
Impaired Loans
Total
£m
Impairment
allowance
£m
Collectively
£m
Individually
£m
As at 31 December 2011
Trading portfolio loans 1,374 – – – 1,374 –
Loans and advances designated at fair value 21,528 432 – – 21,960 –
Home loans 160,932 114 10,678 382 172,106 (834)
Credit cards, unsecured and other retail lending 60,648 348 7,334 702 69,032 (4,540)
Wholesale 228,909 9,507 816 9,607 248,839 (5,223)
Total 473,391 10,401 18,828 10,691 513,311 (10,597)
As at 31 December 2010
Trading portfolio loans 2,170 – – – 2,170 –
Loans and advances designated at fair value 22,273 79 – – 22,352 –
Home loans 156,908 467 11,238 296 168,909 (854)
Credit cards, unsecured and other retail lending 54,435 626 9,459 668 65,188 (5,919)
Wholesale 218,622 7,070 779 17,605 244,076 (5,659)
Total 454,408 8,242 21,476 18,569 502,695 (12,432)
Loans and advances neither past due nor impaired (audited)
2011 2010
As at 31 December Strong
£m
Satisfactory
£m
Higher risk
£m
Total
£m
Strong
£m
Satisfactory
£m
Higher risk
£m
Total
£m
Trading portfolio loans 74 821 479 1,374 352 1,203 615 2,170
Loans and advances designated at fair value 19,484 1,487 557 21,528 17,496 2,100 2,677 22,273
Home loans 134,009 25,847 1,076 160,932 125,311 29,785 1,812 156,908
Credit cards, unsecured and other retail lending 14,226 45,388 1,034 60,648 9,239 41,896 3,300 54,435
Wholesale 162,134 61,964 4,811 228,909 151,449 61,281 5,892 218,622
Total 329,927 135,507 7,957 473,391 303,847 136,265 14,296 454,408
% of total 69.7% 28.6% 1.7% 100.0% 66.9% 30.0% 3.1% 100.0%
Risk management
Credit risk continued
Notes
a For 2010, as a result of improvements in data quality, home loans to the value of £40.0bn that were classified as Satisfactory in 2010 have been identified as being Strong.
b For 2011 reporting, loans that were previously classified as past due but not individually impaired have been disaggregated between loans past due but not impaired and collectively
assessed impaired loans.
104 Barclays PLC Annual Report 2011 www.barclays.com/annualreport