Barclays 2006 Annual Report Download - page 30

Financial review
Analysis of results by business
Barclays PLC
Annual Report 2006
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Barclaycard is a multi-brand credit card and consumer loans business which also processes card payments for retailers and merchants and issues
credit and charge cards to corporate customers and the UK Government. It is one of Europe’s leading credit card businesses and has an increasing
presence in the United States.
In the UK, Barclaycard comprises Barclaycard, SkyCard and Monument branded credit cards, Barclays branded loans and FirstPlus secured lending.
Barclaycard also manages card operations on behalf of Solution Personal Finance.
Outside the UK, Barclaycard provides credit cards in the United States, Germany, Spain, Italy, Portugal and Africa. In the Nordic region, Barclaycard
operates through Entercard, a joint venture with FöreningsSparbanken (Swedbank).
Barclaycard works closely with other parts of the Group, including UK Retail Banking, UK Business Banking and International Retail and Commercial
Banking, to leverage their distribution capabilities.
2006 2005 2004(a)
£m £m £m
Net interest income 1,843 1,726 1,587
Net fee and commission income 1,054 972 790
Net investment income 15 – –
Net premiums from insurance contracts 33 24 22
Total income 2,945 2,722 2,399
Net claims and benefits on insurance contracts (8) (7) (5)
Total income net of insurance claims 2,937 2,715 2,394
Impairment charges (1,493) (1,098) (761)
Net income 1,444 1,617 1,633
Operating expenses excluding amortisation of intangible assets (1,037) (961) (804)
Amortisation of intangible assets (17) (17) (3)
Operating expenses (1,054) (978) (807)
Share of post-tax results of associates and joint ventures (8) 1 4
Profit before tax 382 640 830
Cost:income ratio 36% 36% 34%
Cost:net income ratio 73% 60% 49%
Risk Tendency £1,410m £1,100m £860m
Return on average economic capital 10% 16% 24%
Economic profit £nil £183m £350m
2006 2005 2004
Loans and advances to customers £25.5bn £24.0bn £22.3bn
Total assets £27.6bn £25.8bn £23.4bn
Risk weighted assets £25.2bn £21.8bn £20.2bn
Key Facts
Number of Barclaycard UK customers 9.8m 11.2m 11.2m
Number of retailer relationships 93,000 93,000 90,000
UK credit cards – average outstanding balances £9.4bn £10.1bn £9.6bn
UK credit cards – average extended credit balances £8.0bn £8.6bn £8.2bn
UK loans – average consumer lending balances £11.9bn £10.3bn £9.4bn
International – average extended credit balances £2.5bn £1.8bn £0.9bn
International – cards in issue 6.4m 4.3m 2.9m
£2,937m 5%
Income Contribution to Group profitProfit before tax
£382m
Barclaycard
Note
(a) Does not reflect the application of IAS 32, IAS 39 and IFRS 4 which became effective from 1st January 2005.