Barclays 2008 Annual Report Download - page 246

Notes to the accounts
For the year ended 31st December 2008
244 Barclays PLC Annual Report 2008 |Find out more at www.barclays.com/annualreport08
33 Minority interests
2008 2007
£m £m
At beginning of year 9,185 7,591
Share of profit after tax 905 678
Dividend and other payments (703) (480)
Equity issued by subsidiaries 1,349 1,381
Available for sale reserve: net (loss)/gain from changes in fair value (1) 1
Cash flow hedges: net gain/(loss) from changes in fair value 76 (16)
Currency translation differences 100 25
Additions –27
Disposals (11) (111)
Other (107) 89
At end of year 10,793 9,185
During the year, Barclays Bank PLC issued the following Preference Shares:
106 million Preference Shares of nominal US$0.25 each (Principal amount: US$2,650m; £1,345m) with a 8.125% dividend issued on 11th April 2008
and 25th April 2008.
34 Contingent liabilities and commitments
Contingent liabilities and commitments
The following table summarises the nominal principal amount of contingent liabilities and commitments with off-balance sheet risk:
2008 2007
£m £m
Acceptances and endorsements 585 365
Guarantees and letters of credit pledged as collateral security 15,652 12,973
Securities lending arrangements 38,290 22,719
Other contingent liabilities 11,783 9,717
Contingent liabilities 66,310 45,774
Documentary credits and other short-term trade related transactions 859 522
Undrawn note issuance and revolving underwriting facilities:
Forward asset purchases and forward deposits placed 291 283
Standby facilities, credit lines and other 259,666 191,834
Commitments 260,816 192,639
Nature of instruments
In common with other banks, the Group conducts business involving acceptances, performance bonds and indemnities. The majority of these facilities
are offset by corresponding obligations of third parties.
An acceptance is an undertaking by a bank to pay a bill of exchange drawn on a customer. The Group expects most acceptances to be presented, but
reimbursement by the customer is normally immediate. Endorsements are residual liabilities of the Group in respect of bills of exchange, which have been
paid and subsequently rediscounted.
Guarantees and letters of credit are given as security to support the performance of a customer to third parties. As the Group will only be required to
meet these obligations in the event of the customer’s default, the cash requirements of these instruments are expected to be considerably below their
nominal amounts.
The Group facilitates securities lending arrangements for its investment management clients whereby securities held by funds are lent to third parties.
The borrowers provide the funds with collateral in the form of cash or other assets equal to at least 100% of the securities lent plus a margin of at least 2%
up to 8%. Over the period of the loan, the funds may make margin calls to the extent that the collateral is less than the market value of the securities lent.
Amounts disclosed above represent the total market value of the lent securities at 31st December 2008. The market value of collateral held by the funds
was £39,690m (2007: £23,559m).