Barclays 2003 Annual Report Download - page 81

Barclays PLC Annual Report 2003 79
Barclays Capital
Barclays Capital is the investment banking division
of Barclays, providing corporate, institutional and
government clients with solutions to their financing
and risk management needs.
The Barclays Capital business model is distinctive. It focuses on a broad
span of financing and risk management services in the interest rate,
foreign exchange, commodities and credit markets combined with
certain capabilities in equities. Activities are split between two areas:
Rates, which includes fixed income, foreign exchange, commodities,
emerging markets, money markets sales, trading and research, prime
brokerage and equity related activities; and Credit, which includes
origination, sales, trading and research relating to loans, debt capital
markets, structured capital markets, and private equity.
Barclays Capital works increasingly with other Group businesses,
including Barclays Private Clients, Business Banking and Barclays Global
Investors, to provide a more integrated customer service and to develop
business opportunities across the Group.
Key business developments in 2003:
• Barclays Capital continued to improve its ranking in the global all
debt league table, to fourth position from fifth position in 2002.
• Barclays Capital increased its issuance volume of international bonds
and syndicated loans to US$199bn compared to US$162bn in 2002.
• Barclays Capital increased its issuance volume of European all debt to
US$140bn (2002: US$116bn) and ranked third in 2003 (2002: second).
• Barclays Capital remained in first position for issuing sterling
denominated bonds with a 19% market share.
• Barclays Capital improved its ranking to top ten in US investment
grade corporate bonds from 13th position in 2002 with market share
more than doubling.
• Barclays Capital led 49 dollar denominated deals for US issuers in
2003 versus 24 in 2002 and only one prior to 2001.
• E-commerce channels continued to see an increase in the volumes
of business processed; half of clients’ foreign exchange tickets were
executed electronically. Barclays Capital won several awards for
e-commerce initiatives in 2003.
Barclays Global Investors
Barclays Global Investors (BGI) is one of the world’s
largest asset managers and a leading global provider
of investment management products and services.
BGI offers structured investment strategies such as
indexing, tactical asset allocation and risk-controlled
active products such as hedge funds.
BGI also provides related investment services such as securities lending,
cash management and portfolio transition services. Barclays Global
Investors investment philosophy focuses on managing all dimensions
of performance: return, risk and cost.
Key business developments in 2003:
• BGI had over 2,500 institutional clients in 47 countries.
• Investment performance continued to be good in our active
strategies. 2003 average alpha across active products was 1.36%
above benchmark.
•Several important milestones were achieved by 31st December 2003:
total assets under management exceeded US$1 trillion, of which more
than US$200bn were in actively managed assets; and for the first time
total revenues exceeded US$1bn.
•£67bn net new assets were attracted in 2003. Approximately £25bn of
net new assets flowed into index products, £23bn into active products,
£14bn into Global iShares, Barclays brand of Exchange Traded Funds
(ETFs), and £5bn into cash.
• The active business accounted for over 60% of management fees and
over 50% of total income.
• BGI’s leading position in ETFs was extended with the launch of eight
new funds and it became the largest ETF manager in the world.
Global iShares, saw assets under management grow to US$69bn,
up 97% (2002: US$35bn).
• BGI is the largest global institutional asset manager of hedge
fund assets.
• BGI results were significantly affected by exchange rate translation
movements.