Barclays 2011 Annual Report Download - page 185

£561m
profit before tax
£4,095m
total income net of insurance claims
Total assets increased 12% to £33.8bn and risk weighted assets
increased 7% to £34.2bn reflecting acquired portfolios and organic
growth in the UK. These were partially offset by continued run-off
of the FirstPlus portfolio.
Adjusted return on average equity increased to 17.4% (2010: 12.5%)
and adjusted return on average tangible equity increased to 23.0%
(2010: 16.9%), reflecting increased profit after tax.
2010
Barclaycard profit before tax increased 9% to £791m. Barclaycard’s
international businesses reported strong growth in profit before tax,
particularly in South Africa and the US. South Africa card increased 85%
to £176m (2009: £95m) primarily through lower underlying impairment.
The US business was profitable following adoption of the requirements
of the Credit Card Accountability, Responsibility and Disclosure Act in the
US (US Credit CARD Act).
Income was £4,024m (2009:£4,041m) with the impact of the US Credit
CARD Act broadly offset by balanced growth across the business. Over
20% of income was generated from products other than consumer credit
cards. Barclaycard’s UK businesses reported income at £2,453m (2009:
£2,493m) reflecting the continued run-off of the FirstPlus secured lending
portfolio and lower insurance-related income. International income
increased 1% to £1,571m (2009: £1,548m) despite the impact of the
US Credit CARD Act.
Net interest income increased 3% to £2,814m reflecting growth in UK
consumer card extended credit balances, up 4% to £8.8bn (2009:
£8.5bn), and the appreciation of the average value of the Rand against
Sterling, partially offset by lower net interest income due to the impact
of the US Credit CARD Act and the continued run-off of the FirstPlus
portfolio. The customer asset margin improved to 935bps (2009:
934bps), with the net interest margin at 977bps (2009: 969bps).
AdjustedaStatutory
2011 2010 2009 2011 2010 2009
Performance Measures
Return on average equityb17.4% 12.5% 11.9% 6.8% 12.5% 11.9%
Return on average tangible equityb23.0% 16.9% 16.5% 9.0% 16.9% 16.6%
Return on average risk weighted assets 2.6% 1.9% 1.8% 1.2% 1.9% 1.8%
Loan loss rate (bps) 391 570 604 391 570 604
Cost: income ratio 41% 39% 38% 56% 39% 38%
Key Facts
30 day arrears rates – UK cards 2.7% 3.4% 4.2%
30 day arrears rates – US cards 3.1% 4.6% 6.1%
30 day arrears rates – South Africa cardsc 4.9% 7.2% 8.9%
Total number of Barclaycard customers 23.5m 21.7m 21.2m
Total average outstanding balances – Cards £22.8bn £20.9bn £20.5bn
Total average extended credit balances – Cards £19.1bn £17.0bn £16.4bn
Average outstanding balances – Loans £5.0bn £5.5bn £6.0bn
Number of retailer relationships 87,000 87,000 87,000
Number of employees (full time equivalent) 10,400 9,900 10,100
Notes
a Adjusted profit before tax and adjusted performance measures excludes the impact of the provision for PPI redress of £600m (2010: £nil; 2009: £nil), £47m goodwill impairment in
Firstplus secured lending portfolio (2010: £nil; 2009: £nil) and profit on disposal of £nil (2010: £nil; 2009: £3m).
b Return on average equity and return on average tangible equity comparatives have been revised to use 10% of average risk weighted assets (previously 2010: 9%; 2009: 8%) in the
calculation of average equity and average tangible equity.
c South Africa cards 30 day arrears rates revised to include approved debt counselling accounts.
Net fee and commission income decreased 11% to £1,136m primarily due
to the impact of the US Credit CARD Act. Investment income of £39m
included a gain of £38m from the sale of Visa shares and MasterCard
shares (2009: £20m).
Credit impairment charges reduced 6% to £1,688m reflecting focused
risk management and improving economic conditions. As a result, loan
loss rates improved to 570bps (2009: 604bps). In addition, the 30-day
delinquency rates for consumer card portfolios in the UK of 3.4% (2009:
4.2%), in the US of 4.6% (2009: 6.1%) and in South Africa cards of 7.2%
(2009: 8.9%) all reduced compared to 2009.
Operating expenses increased 3% to £1,570m. Excluding increased
pension costs and the appreciation of the average value of the Rand
against Sterling, operating expenses decreased compared to the
prior year.
Total assets were flat at £30.3bn reflecting the appreciation of the US
Dollar and the Rand against Sterling offset by the continued run-off of the
First Plus portfolio.
Risk weighted assets increased 4% to £31.9bn (2009: £30.6bn), reflecting
securitisation redemptions and the appreciation of the US Dollar and the
Rand against Sterling.
Adjusted return on average equity of 12.5% (2009: 11.9%) and adjusted
return on average tangible equity of 16.9% (2009: 16.5%) increased
reflecting increased profit after tax.
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