Barclays 2003 Annual Report Download - page 61
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Barclays PLC Annual Report 2003 59
Coverage ratios
The coverage of non-performing loans by the Group’s stock of provisions and interest in suspense increased from 68.0% at 31st December 2002 to
74.1% at 31st December 2003. Over the same period, coverage of potential credit risk lendings increased from 52.8% to 54.6%.
Provisions coverage of non-performing loans Provisions coverage of potential credit risk lendings (NPLs and PPLs)
Total provisions coverage of non-performing loans
2003 2002 2001 2000 1999
%% % % %
United Kingdom 77.6 74.2 74.9 72.9 81.1
Other European Union 71.4 61.8 78.6 72.1 94.5
United States 39.2 43.7 61.8 81.0 74.1
Rest of the World 83.9 61.8 59.2 64.7 50.4
Total coverage of non-performing loans 74.1 68.0 72.1 72.4 79.1
Total provisions coverage of potential credit risk lendings (NPLs and PPLs)
2003 2002 2001 2000 1999
%% % % %
United Kingdom 57.7 57.2 56.4 57.7 62.0
Other European Union 65.0 61.8 77.5 71.4 84.0
United States 23.4 33.0 28.6 22.6 70.0
Rest of the World 67.5 49.3 51.9 53.4 43.9
Total coverage of potential credit risk lending 54.6 52.8 52.9 54.5 62.1
The general provision is allocated according to the characteristics of the loans in each geographic area.
Another useful way of assessing provision balances is to recognise that specific provisions are created to cover non-performing loans, whereas general
provisions relate to as yet unidentified losses on performing loans. The following table provides an analysis of provision balances on this basis.
Ratios of general and specific provision balances
2003 2002 2001 2000 1999
%% % % %
Specific provisions coverage of non-performing loans 53.7 50.0 50.9 47.2 50.2
General provisions coverage of performing loans (excluding trading book) 0.43 0.43 0.47 0.52 0.62
General provisions coverage of performing loans (including trading book) 0.28 0.28 0.33 0.38 0.43
The ratio of general provisions to performing loans declined in 2000 and 2001 following the acquisition of Woolwich plc, a portfolio consisting
predominantly of secured residential mortgage loans needing comparatively low general provisions. Performing loans comprise gross loans and
advances less non-performing loans. All non-performing loans are on the banking book.
0
20
40
60
1999 2000 2001 2002%
80
2003
79.1
72.4 72.1 68.0 74.1
0
20
40
60
1999 2000 2001 2002%
80
2003
62.1
54.5 52.9 52.8 54.6