Barclays 2006 Annual Report Download - page 89

Barclays PLC
Annual Report 2006 85
Operating review
1
Notes
(a) Prior year analysis of loans and advances between retail business and wholesale and corporate business has been reclassified to reflect enhanced methodology
implemented in current year.
(b) For 2005, this reflects the period from 27th July until 31st December 2005.
(c) Represents the increase in the allowance for the period following the Group’s assessment of the recoverability of its loans and receivables, in accordance with IAS 39.
(d) Represents net of allowances brought in from new subsidiaries acquired and allowances released following disposal of assets in the year.
(e) Represents recoveries of amounts previously written off.
(f) Includes unwind of discount and other adjustments.
(g) Balances are written off when it is considered that there is no possibility of making further recoveries.
Movements
6,000
Movements in allowances for impairment on loans and advances £m
3,000
2,000
5,000
4,000
1,000
0
Balance at
31st Dec 05
Impairment
charged against
profit(c)
Recoveries(e) Adjustments(f) Acquisitions
and Disposals(d) Amounts
written off(g) Balance
at 31st Dec 06
3,450
2,074
(23)
259
(251)
3,335
(2,174)
The wholesale and corporate impairment charge was 0.15% (2005:
0.19%) as a percentage of year-end total loans and advances of
£177,211m (2005(a): £169,031m), including balances in Absa of
£9,299m (2005: £9,731m).
In Absa, impairment charges increased to £126m (2005(b): £20m)
reflecting a full year of business and normalisation of credit conditions
in South Africa following a period of low interest rates.
The total impairment charges and other credit provisions in Barclays
Capital included losses of £83m (2005: £nil) on an ‘available for sale’
portfolio where an intention to sell caused the losses to be viewed as
other than temporary in nature.
Total impairment allowances at the end of 2006 decreased by 3% (£115m) to £3,335m from the previous year (2005: £3,450m).
An analysis of all movements in the impairment balance is shown in the following chart.