Barclays 2006 Annual Report Download - page 252

Notes to the accounts
For the year ended 31st December 2006
Barclays PLC
Annual Report 2006
248
59 Segmental reporting
Business segments
The Group reports the results of its operations through eight business segments: UK Banking, Barclaycard, International Retail and Commercial
Banking, Barclays Capital, Barclays Global Investors, Barclays Wealth, Barclays Wealth – Closed Life Assurance Business and Head Office and other
operations.
UK Banking provides banking solutions to Barclays UK retail and business banking customers. Barclaycard provides credit card services across
Europe and the United States. International Retail and Commercial Banking provides banking services to personal and corporate customers in
Europe, Africa and the Middle East. Barclays Capital conducts the Group’s investment banking business providing corporate, institutional and
government clients with financing and risk management products. Barclays Global Investors provides investment management products and
services to international institutional clients. Barclays Wealth provides banking and asset management services to affluent and high net worth
clients. Head Office functions and other operations comprise all the Group’s central function costs and other central items including businesses
in transition.
During 2006 Barclays realigned a number of reportable business segments to better reflect the type of client served, the nature of the products
offered and the associated risks and rewards. The changes have no impact on the Group Income Statement or Balance Sheet, and are summarised
as follows:
The majority of Absa Corporate and Merchant Banking, previously reported in International Retail and Commercial Banking, has been relaunched as
Absa Capital and is being managed and reported in Barclays Capital. A number of financial institution, large corporate and property clients previously
reported within UK Banking are now managed by and reported in Barclays Capital. Certain portfolios previously reported in UK Banking have been
reclassified as businesses in transition and are now centrally managed and reported in Head Office functions and other operations.
The structure remains unchanged for Barclays Global Investors, Barclays Wealth, Barclays Wealth – closed life assurance activities
and Barclaycard.
All transactions between business segments are conducted on an arms length basis. Internal charges and transfer pricing adjustments are reflected
in the performance of each business. Head office functions and other operations contains a centralised treasury function, which deals with the
Group’s funding requirements. The funding requirements of each business segment reflects funding at market rates and not internally generated
transfer prices and is therefore not separately disclosed within inter-segment net income.
Barclays
International Wealth Head office
Retail and Barclays – closed life functions
UK Commercial Barclays Global Barclays assurance and other
Banking Barclaycard Banking Capital Investors Wealth activities operations Total
As at 31st December 2006 £m £m £m £m £m £m £m £m £m
Income from external customers,
net of insurance claims 6,253 2,816 3,308 6,206 1,670 1,073 127 142 21,595
Inter-segment income (30) 121 29 61 (5) (37) 4 (143) –
Total income net of insurance claims 6,223 2,937 3,337 6,267 1,665 1,036 131 (1) 21,595
Impairment charge and other
credit provisions (461) (1,493) (167) (42) – (2) – 11 (2,154)
Segment expenses – external (2,439) (805) (2,170) (3,988) (940) (759) (87) (1,486) (12,674)
Inter-segment expenses (826) (249) (26) (21) (11) (62) (22) 1,217 –
Total expenses (3,265) (1,054) (2,196) (4,009) (951) (821) (109) (269) ( 12,674)
Share of post-tax results of
associates and joint ventures 5(8)49–––––46
Profit on disposal of subsidiaries,
associates and joint ventures 76–247–––––323
Business segment
performance before tax 2,578 382 1,270 2,216 714 213 22 (259) 7,136
Additional information
Depreciation and amortisation 95 45 180 132 13 12 – 114 591
Impairment loss – intangible assets ––5––––27
Capital expenditure(a) 217 99 193 246 406 44 – 166 1,371
Investments in associates and
joint ventures 12 89 56 71 – – – – 228
Total assets 139,902 27,628 68,848 657,922 80,515 7,285 7,605 7,082 996,787
Total liabilities 159,503 1,909 37,567 632,208 79,366 26,817 7,499 24,528 969,397
Note
(a) Capital expenditure comprises purchased goodwill, intangible assets and property, plant and equipment acquired during the year.