Barclays 2009 Annual Report Download - page 34

32 Barclays PLC Annual Report 2009 www.barclays.com/annualreport09
Net fee and commission income 2009 2008 2007
£m £m £m
Brokerage fees 88 56 78
Investment management fees 133 120 122
Banking and credit related fees
and commissions 9,578 7,208 6,363
Foreign exchange commission 147 189 178
Fee and commission income 9,946 7,573 6,741
Fee and commission expense (1,528) (1,082) (970)
Net fee and commission income 8,418 6,491 5,771
Financial review
Income statement commentary
continued
Continuing operations
The commentary below reflects the Group’s results from continuing
operations.
Net interest income
2009/08
Group net interest income increased 4% (£449m) to £11,918m (2008:
£11,469m) reflecting growth in average customer balances primarily in
Barclaycard and Western Europe, and net funding costs and hedging
recognised in Head Office Functions and Other Operations.
Group net interest income includes the impact of structural hedges
which function to reduce the impact of the volatility of short-term interest
rate movements on equity and customer balances that do not re-price with
market rates. In total, equity structural hedges generated a gain of £1,162m
(2008: £21m gain).
Further discussion of margins is included in the analysis of results by
business on pages 58 to 79.
2008/07
Group net interest income increased 19% (£1,871m) to £11,469m
(2007: £9,598m) reflecting balance sheet growth across the Global Retail
and Commercial Banking businesses and in particular very strong growth
internationally driven by expansion of the distribution network and entrance
into new markets. An increase in net interest income was also seen in
Barclays Capital due to strong results from global loans and money markets.
The contribution of structural hedges relative to average base rates
increased income by £117m (2007: £351m expense), largely due to the
effect of the structural hedge on changes in interest rates.
Net fee and commission income
2009/08
Net fee and commission income increased 30% (£1,927m) to £8,418m
(2008: £6,491m). Banking and credit related fees and commissions
increased 33% (£2,370m) to £9,578m (2008: £7,208m), primarily due to
Barclays Capital’s strong performance in Equities and Investment Banking.
2008/07
Net fee and commission income increased 12% (£720m) to £6,491m
(2007: £5,771m). Banking and credit related fees and commissions
increased 13% (£845m) to £7,208m (2007: £6,363m), reflecting growth
in Barclaycard International, increased fees from advisory and origination
activities in Barclays Capital and increased foreign exchange, derivative
and debt fees in Barclays Commercial Bank.
Net interest income 2009 2008 2007
£m £m £m
Cash and balances with
central banks 131 174 145
Available for sale investments 1,937 2,355 2,580
Loans and advances to banks 513 1,267 1,416
Loans and advances to customers 18,456 23,754 19,559
Other 199 460 1,596
Interest income 21,236 28,010 25,296
Deposits from banks (634) (2,189) (2,720)
Customer accounts (2,716) (6,697) (4,110)
Debt securities in issue (3,889) (5,910) (6,651)
Subordinated liabilities (1,718) (1,349) (878)
Other (361) (396) (1,339)
Interest expense (9,318) (16,541) (15,698)
Net interest income 11,918 11,469 9,598