Barclays 2004 Annual Report Download - page 55

53
Barclays PLC Annual Report 2004
Geographical Analysis and Country Risk
Loans and advances to customers on the banking book amounted
to £193bn at the year end (2003: £171bn, 2002: £160bn). The
geographical analysis shown in the chart below is based on the
location of the office recording the transaction. The UK exposure
shown includes some major loans to customers in other countries that
were booked in London, and thus includes some international risk.
(See also Table 6 on page 74.)
The loans and advances to customers on the banking book booked
through the Group’s operations in Iberia were £12bn at 31st December
2004, 6.2% of the Group total. They were comprised of £5.8bn in
residential mortgages (48%) and £6.2bn (52%) in other loans.
Barclays exposure limits to sub-investment grade countries are shown
in the chart below (largest 15 exposure limits).
0£m 200 400 600 800 1,000 1,200
Credit exposure limits to sub-investment grade countries
India
Egypt
Brazil
Ghana
Indonesia
Tanzania
Algeria
Seychelles
Zimbabwe
Russia
Zambia
Venezuela
Kenya
Turkey
Philippines
2002 2003 2004%
UK
Other European Union
United States
Rest of the World
Geographical analysis of loans and advances to customers on
the banking book
100
80
60
40
20
10
0
The country exposures shown are the sum of customer limits and
unused but available product limits. Both domestic and cross-border
exposures are included.
Loans and advances to borrowers in currencies other than the
currencies of the borrowers are shown in the tables on page 77.
Risk Profile of Customer Loans and Advances
The chart below shows Barclays wholesale loan profile by internal
risk grade (See page 49 for a description of the rating system). It is
important to note that Barclays prices loans for risk. Thus higher
risk loans will usually have higher interest rates or fees or both.
A portfolio of higher risk loans may therefore be as profitable as,
or more profitable than, a portfolio of lower risk loans.
Notes
(a) Excludes non-performing and potential problem loans
Industry Analysis
An industry analysis of customer loans is shown in the chart below.
These classifications have been prepared at the level of the borrowing
entity. This means that a loan to the subsidiary of a major corporation
is classified by the industry in which the subsidiary operates, even
though the parent’s predominant business may be in a different
industry. Loans to customers domiciled outside the country where the
office recording the transaction is located are shown in the chart
under ‘ Overseas Customers’ and not by industry.
0510
%
15 20
Loans and advances, balances and limits to wholesale
customers by internal risk rating(a)
Loan balances by internal
rating – % of Total
0510
%
15 20
Loan limits by internal
rating – % of Total
1.2
1.5
1.8
3
5
7
6
8
2.5
2.1
2.8
4
Rating
Risk management
Loans and advances to customers on the banking book