Barclays 2009 Annual Report Download - page 29

www.barclays.com/annualreport09 Barclays PLC Annual Report 2009 27
Financial KPIs continued
Definition
Loan funding ratio
This is the ratio of customer loans to deposits
and long-term funding. It represents the Group’s
access to high quality and stable funding sources
to fund customer assets. The ratio is calculated by
dividing customer loans by customer deposits
plus greater than one year funding (in each case,
excluding Absa).
Average term of unsecured liabilities
This is calculated as the term of outstanding
wholesale borrowing (excluding subordinated
debt and excluding Absa, that has country
specific funding dynamics that differ from the
rest of the Group), after removing the short-term
deposits that are directly invested in the liquidity
pool. The longer the average term the lower the
aggregate refinancing risk in wholesale markets.
Why it’s important to the business and management
International regulators have considered the imposition of a
backstop core funding ratio as a means of limiting liquidity risk to
individual banks and to the financial system as a whole. We have
no clear guidance on whether such a ratio will be developed in the
UK. The Barclays Liquidity Risk Framework already limits the
Group’s reliance on less stable sources of funding and we use the
ratio to monitor wholesale refinancing risk and to ensure that
short-term wholesale financing is not used to fund core customer
assets. Comparative data for 2007 is unavailable as the Group has
only formally measured this ratio since 2008.
The extension of the term of our wholesale financing has meant
that, as at 31st December 2009, over 81% of net wholesale
funding has remaining maturity greater than one year and, as at
the same date, there was no net wholesale unsecured refinancing
required within six months. This improvement in the term of
wholesale funding has meant that Barclays has no reliance on
short-term wholesale funding markets and consequently has
greatly increased the Group’s resilience to any future liquidity
stress event. Comparative data for 2007 is unavailable as the
Group has only formally measured the average term of its
unsecured liabilities since 2008.
2007 2008 2009
14% 10% (8)%
– UK
– Non-UK
10.1m
7.7m
10.8m
10.4m
11.6m
11.7m
07 08
09
Strategic KPIs: Build the best bank
Definition
UK retail banking customer satisfaction
The Retail Banking Service Monitor tracks
satisfaction amongst Barclays customers.
Approximately 10,000 customers a month are
researched for this study. The satisfaction score
is measured using the percentage of customers
who state they are ‘Very’ or ‘Completely’
satisfied with Barclays. We also benchmark
our performance in comparison with
competitors using syndicated or directly
commissioned research.
Net lending in Barclays Commercial Bank
Net lending represents the change in our loans
and advances to customers during the year.
Barclaycard International
– number of customers
The total number of customers split between
UK and non-UK.
Why it’s important to the business and management
Putting the customer first and improving customer service is
fundamental to our goal of being the UK’s best bank. Customer
satisfaction targets are set at a strategic business unit level
and business area action plans are developed through the
continuous tracking of customer satisfaction and complaints
feedback. Since June 2008 customer satisfaction and
advocacy have been on an increasing trend as a result of
significant improvements to our service and innovations
in our product offerings.
Building the best bank means we are there for our customers.
We have supported our customers through the recession
via campaigns such as ‘Turning the Corner’ which has
been awarded ‘Best Customer Relationship Initiative’ in the
B2B Marketing Awards. The campaign offers online expert
advice, insight and networking events to connect our
customers, attracting over 70,000 hits on our website
and over 3,700 people attending connect events.
We continue to be committed to lend to viable businesses
across all portfolios, demonstrated through £14bn of new
term lending and our stable approval rates on new
credit applications.
Barclaycard is one of Europe’s largest multi-branded credit
card businesses, with a fast growing business in the United
States and South Africa. In 2003 we targeted growing
Barclaycard’s international operations to the same scale
as its UK business over ten years. This KPI demonstrates
how this target is being balanced and maintained.
07 08
09
72%
64%
67%
08
09
26 months
14 months
81%
93%
08
09
UK Retail Banking Cost:Income Ratio is included within the cost management strategic KPI
Note
Loan funding ratio and average term of unsecured liabilities have been introduced as monitors of the Group’s funding model.