Barclays 2012 Annual Report Download - page 146

Summary of Group exposures
The following table shows Barclays exposure to Eurozone countries monitored internally as being higher risk and thus being the subject of
particular management focus. Detailed analysis on these countries is on pages 146-152. Exposures on loans and advances to geographic regions
including Europe as a whole are set out on pages 125-126. The net exposure provides the most appropriate measure of the credit risk to which
the Group is exposed. The gross exposure is also presented below, alongside off-balance sheet contingent liabilities and commitments. Gross
exposure reflects total exposures before the effects of economic hedging by way of trading portfolio liabilities, derivative liabilities, and cash
collateral, but after taking into account impairment allowances and IFRS netting.
Net exposure by country and counterparty (audited)
Sovereign
£m
Financial
institutions
£m
Corporate
£m
Residential
mortgages
£m
Other retail
lending
£m
Total net
on-balance
sheet
exposure
£m
Contingent
liabilities and
commitments
£m
Total net
exposure
£m
As at 31 December 2012
Spain 1,690 1,488 4,135 13,305 2,428 23,046 3,301 26,347
Italy 2,669 528 1,962 15,591 1,936 22,686 3,082 25,768
Portugal 637 48 1,958 3,474 1,783 7,900 2,588 10,488
Ireland 11 3,768 1,127 112 83 5,101 1,644 6,745
Cyprus 8 – 106 44 26 184 131 315
Greece 1 – 61 8 9 79 5 84
As at 31 December 2011
Spain 2,530 987 5,345 14,654 3,031 26,547 3,842 30,389
Italy 3,493 669 2,918 15,934 2,335 25,349 3,140 28,489
Portugal 810 51 3,295 3,651 2,053 9,860 2,536 12,396
Ireland 244 4,311 977 94 86 5,712 1,582 7,294
Cyprus 15 – 128 51 2 196 127 323
Greece 14 2 67 5 18 106 26 132
During 2012 the Group’s sovereign exposure to Spain, Italy, Portugal, Ireland, Cyprus and Greece reduced by 29% to £5.0bn. Spanish sovereign
exposure reduced 33% to £1.7bn due to the disposal of available for sale government bonds, held for the purpose of interest rate hedging and
liquidity, which have been replaced by interest rate swaps with alternative counterparties. Italian sovereign exposure decreased 24% to £2.7bn
principally due to a reduction in government bonds held as available for sale.
Residential mortgage exposure reduced by 5% to £32.5bn, reflecting lower new originations across Spain, Italy and Portugal in line with Group
strategy to reduce redenomination risk. Other retail lending reduced by 17% to £6.3bn driven primarily by reduced lending to business banking
customers in Spain and Portugal as a result of the challenging economic conditions. Corporate exposure reduced 27% to £9.3bn, largely reflecting
reduced lending in Spain, Italy and Portugal as part of the active management to reduce the aggregate net funding mismatch in local balance
sheets. Exposures to financial institutions fell marginally by 3% to £5.8bn, with reduced exposure in Ireland of £0.5bn and in Italy of £0.1bn
offsetting an increase in Spain of £0.5bn.
Gross exposure by country and counterparty (audited)
Sovereign
£m
Financial
institutions
£m
Corporate
£m
Residential
mortgages
£m
Other retail
lending
£m
Total gross
on-balance
sheet
exposure
£m
Contingent
liabilities and
commitments
£m
Total gross
exposure
£m
As at 31 December 2012
Spain 2,523 9,253 4,447 13,305 2,428 31,956 3,301 35,257
Italy 5,428 7,687 2,348 15,591 1,936 32,990 3,082 36,072
Portugal 1,035 347 2,130 3,474 1,783 8,769 2,588 11,357
Ireland 46 8,613 1,397 112 83 10,251 1,644 11,895
Cyprus 8 102 120 44 26 300 131 431
Greece 3 1,181 61 8 9 1,262 5 1,267
As at 31 December 2011
Spain 3,278 8,593 5,751 14,654 3,031 35,307 3,842 39,149
Italy 5,530 6,921 3,469 15,934 2,335 34,189 3,140 37,329
Portugal 1,102 400 3,541 3,651 2,053 10,747 2,536 13,283
Ireland 348 10,105 1,665 94 86 12,298 1,582 13,880
Cyprus 15 120 128 51 2 316 127 443
Greece 14 1,111 67 5 18 1,215 26 1,241
barclays.com/annualreport144 I Barclays PLC Annual Report 2012
Risk review
Credit risk continued