Barclays 2006 Annual Report Download - page 173

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Barclays PLC
Annual Report 2006 169
Financial statements
3
4 Principal transactions
2006 2005 2004
£m £m £m
Rates related business 2,848 1,732 1,141
Credit related business 766 589 346
Net trading income 3,614 2,321 1,487
Net gain from disposal of available for sale assets/investment securities 307 120 45
Dividend income on equity investments 15 22 17
Net gain from financial instruments designated at fair value 447 389 n/a
Income from assets backing insurance policies n/a n/a 717
Other investment income 193 327 248
Net investment income 962 858 1,027
Principal transactions 4,576 3,179 2,514
Net trading income includes the profits and losses arising both on the purchase and sale of trading instruments and from the revaluation to market
value, together with the interest income earned from these instruments and the related funding cost.
The gain/loss from disposal of available for sale assets was calculated on an instrument by instrument basis.
Of the total net trading income, £947m (2005: £498m, 2004: £556m) was earned on securities and £480m (2005: £340m, 2004: £213m) was
earned in foreign exchange dealings.
Rates related business includes fixed income, foreign exchange, commodities, emerging markets, money markets sales, trading and research, prime
services and equity products; Credit related business includes primary and secondary activities for loans and bonds for investment grade, high yield
and emerging market credits, as well as hybrid capital products, asset-based finance, commercial mortgage backed securities, credit derivatives,
structured capital markets and large asset leasing.
The net gain on financial assets designated at fair value included within principal transactions was £489m (2005: £391m, 2004: n/a) of which gains
of £42m (2005: £2m gain, 2004: n/a) were included in net trading income and gains of £447m (2005: £389m, 2004: n/a) were included in net
investment income.
The net loss on financial liabilities designated at fair value included within principal transactions was £920m (2005: £666m, 2004: n/a) all of which
was included within net trading income.
5 Insurance premiums and insurance claims and benefits
2006 2005 2004
£m £m £m
Gross premiums from insurance contracts 1,108 909 1,069
Premiums ceded to reinsurers (48) (37) (27)
Net premiums from insurance contracts 1,060 872 1,042
2006 2005 2004
£m £m £m
Gross claims and benefits incurred on insurance contracts 588 694 1,275
Reinsurers’ share of claims incurred (13) (49) (16)
Net claims and benefits incurred on insurance contracts 575 645 1,259