Barclays 2014 Annual Report Download - page 299

barclays.com/annualreport Barclays PLC Annual Report 2014 I 297
Notes to the financial statements
20 Loans and advances to banks and customers
Accounting for financial instruments held at amortised cost
Loans and advances to customers and banks, customer accounts, debt securities and most financial liabilities, are held at amortised cost. That
is, the initial fair value (which is normally the amount advanced or borrowed) is adjusted for repayments and the amortisation of coupon, fees
and expenses to represent the effective interest rate of the asset or liability.
In accordance with IAS 39, where the Group no longer intends to trade in financial assets it may transfer them out of the held-for-trading
classification and measure them at amortised cost if they meet the definition of a loan. The initial value used for the purposes of establishing
amortised cost is fair value on the date of the transfer.
As at 31 December 2014
£m
2013
£m
Gross loans and advances to banks 42,111 39,432
Less: allowance for impairment – (10)
Loans and advances to banks 42,111 39,422
Gross loans and advances to customers 433,222 441,485
Less: allowance for impairment (5,455) (7,248)
Loans and advances to customers 427,767 434,237
Further information on the Group’s loans and advances to banks and customers and impairment allowances are included on pages 142 to 173.
Prior to 2010 the Group reclassified certain financial assets, originally classified as held for trading, that were deemed to be not held-for-trading
purposes to loans and advances. The carrying value and fair value of securities reclassified into loans and advances is £1,862m (2013: £2,812m)
and £1,834m (2013: £2,727m) respectively.
If the reclassifications had not been made, the Group’s income statements for 2014 would have included a net gain on the reclassified trading
assets of £57m (2013: gain of £57m).
Financial instruments held at amortised cost
The notes included in this section focus on assets that are held at amortised cost arising from the Group’s retail and
wholesale lending including loans and advances, finance leases, repurchase and reverse repurchase agreements and
similar secured lending. Detail regarding the Group’s capital and liquidity position can be found on pages 184 to 208.
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