Barclays 2008 Annual Report Download - page 50

48 Barclays PLC Annual Report 2008 |Find out more at www.barclays.com/annualreport08
Global Retail and Commercial Banking
Barclays Commercial Bank
Barclays Commercial Bank is one of the UK’s leading providers of banking
solutions to business customers and clients with an annual turnover of
more than £1m.
What we do
Barclays Commercial Bank provides banking services to more than 81,000
customers in the UK via a network of relationship, regional, industry-sector
and product specialists.
Working closely with our clients to understand their needs, we deliver
financing, risk management, trade and cash management solutions
constructed from a comprehensive suite of products, expertise and
services. This includes specialist asset financing and leasing facilities.
Performance
2008/07
Barclays Commercial Bank profit before tax decreased 7% (£91m)
to £1,266m (2007: £1,357m) reflecting a resilient performance in
challenging market conditions. The impact of growth in net fee and
commission income and continued strong growth in customer
lending was offset by increased impairment charges and higher
operating expenses.
Income increased 7% (£181m) to £2,745m (2007: £2,564m).
Net interest income improved 1% (£10m) to £1,757m (2007:
£1,747m). There was strong growth in average customer assets,
particularly term loans, which increased 14% to £61.7bn (2007: £53.9bn)
reflecting the continued commitment to lend to viable businesses. The
assets margin decreased 25 basis points to 1.55% (2007: 1.80%) due, in
part, to a continued focus on lower risk term lending. Average customer
accounts grew 3% to £47.6bn (2007: £46.4bn), and the deposit margin
declined slightly to 1.47% (2007: 1.49%) partly reflecting the reductions
in UK base rates in the second half of 2008.
Non-interest income increased to 36% of total income (2007: 32%)
partly reflecting continued focus on cross sales and efficient balance sheet
utilisation. Net fee and commission income increased 15% (£111m) to
£861m (2007: £750m) due to increased income from foreign exchange,
derivative sales and debt fee income.
Income from principal transactions fell to £22m (2007: £56m) due to
lower equity realisations.
Other income of £105m (2007: £11m) included a £39m gain arising
from the restructuring of Barclays interest in a third party finance
operation. This gain was offset by a broadly similar tax charge. Other
income also included £29m (2007: £7m) rental income from operating
leases.
Key facts
2008 2007 2006
Number of customers 81,200 83,800 77,100
Number of colleagues 9,800 9,200 8,100
Highlights
£2,745m£1,266m
Income Profit before tax
Performance indicators
Financial review
Analysis of results by business
1.7
1.7
1.8
0.7
0.8
1.0
06 07
Interest income:
non-interest income £bn
08
0.44
0.45
0.60
06 07
Impairment as %
of loans and advances
to customers and banks
08
Interest
income
Non-interest
income
2.5x 2.1x
1.8x