Barclays 2010 Annual Report Download - page 103

Retail Credit Risk
Gross loans and advances to customers in the retail portfolios increased
10% to £235,335m (2009: £213,489m). In UK Retail Banking, the increase
of 13% to £113,800m (2009: £101,064m) primarily reflected increased
lending in the UK Home Finance portfolio and the acquisition of Standard
Life Bank at the start of 2010. Barclays Wealth loans and advances
increased 36% to £13,584m (2009: £9,972m) primarily due to growth
in High Net Worth lending. Western Europe Retail Banking loans and
advances to customers increased 6%, which primarily reflected growth in
Italian mortgages and the acquisition of Citigroup’s credit card business
in Italy, partially offset by the depreciation in the value of the Euro against
Sterling. Absa balances increased 12% due to the appreciation in the
value of the Rand against Sterling during 2010.
Retail impairment allowances rose 12% to £6,883m (2009: £6,119m)
comprising growth of 34% in Home Loans to £854m (2009: £639m)
and 10% (£549m) in Credit Cards, Unsecured and Other Retail Lending
to £6,029m (2009: £5,480m) as impairment stock increased against
delinquent assets flowing into later cycles.
Total retail loans and advances net of impairment were £228,452m on
31st December 2010 (2009: £207,370m), of which Home Loans were
£168,055m (2009: £149,099m), Credit Cards and Unsecured loans were
£39,171m (2009: £39,012m), and Other Retail Lending were £21,226m
(2009: £19,259m).
Total Home Loans net of impairment to retail customers rose by 13%
to £168,055m (2009: £149,099m) principally due to an increase in the
UK Home Loan portfolios within UK Retail Banking which grew 15% to
£101,210m (2009: £87,943m). Home Loans represented 74% of total retail
loans and advances to customers on 31st December 2010 (2009: 72%).
Credit Risk Loans
CRLs in the Retail portfolios rose 9% to £12,571m (2009: £11,503m)
reflecting increases in Home Loans of 14% to £4,294m (2009: £3,758m)
primarily due to an increase in recovery balances in the Sterling value of
Absa Home Loans portfolio and the acquisition of Standard Life Bank.
Credit Cards, Unsecured and Other Retail Lending increased 7% to
£8,277m (2009: £7,745m) reflecting higher recovery balances as accounts
rolled through to later delinquency cycles in most businesses and a weak
debt sale market.
The CRL coverage ratios were higher at 31st December 2010 in Retail
Home Loans at 19.9% (2009: 17.0%) and in Retail Credit Cards Unsecured
and Other Retail Lending at 72.8%, (2009: 70.8%) but remained within
typical severity rate ranges for these types of products.
Retail loans and advances at amortised cost
Gross
loans and
advances
£m
Impairment
allowance
£m
Loans and
advances
net of
impairment
£m
Credit risk
loans
£m
CRLs %
of gross
loans and
advances
%
Impairment
charges
£m
Loan loss
rates
bps
As at 31st December 2010
UK Retail Banking 113,800 1,737 112,063 3,166 2.8% 739 65
Barclaycard 29,281 2,981 26,300 3,678 12.6% 1,668 570
WE Retail Bankinga 44,500 833 43,667 1,729 3.9% 314 71
Barclays Africa 1,962 160 1,802 177 9.0% 54 275
Absa 30,537 842 29,695 3,190 10.4% 385 126
Barclays Corporateb 1,671 255 1,416 301 18.0% 115 688
Barclays Wealth 13,584 75 13,509 330 2.4% 21 15
Total 235,335 6,883 228,452 12,571 5.3% 3,296 140
As at 31st December 2009
UK Retail Banking 101,064 1,587 99,477 3,262 3.2% 936 93
Barclaycard 29,460 2,670 26,790 3,392 11.5% 1,781 605
WE Retail Bankinga42,012 673 41,339 1,410 3.4% 334 80
Barclays Africa 1,811 138 1,673 163 9.0% 88 486
Absa 27,288 655 26,633 2,573 9.4% 500 183
Barclays Corporateb1,882 340 1,542 397 21.1% 246 1,307
Barclays Wealth 9,972 56 9,916 306 3.1% 34 34
Total 213,489 6,119 207,370 11,503 5.4% 3,919 184
Analysis of retail loans and advances to customers at amortised cost net of impairment allowances
Home loans
Credit cards and
unsecured loans
Other retail
lending Total retail
As at 31st December 2010
£m
2009
£m
2010
£m
2009
£m
2010
£m
2009
£m
2010
£m
2009
£m
UK Retail Banking 101,210 87,943 6,500 7,329 4,353 4,205 112,063 99,477
Barclaycard – – 20,991 21,564 5,309 5,226 26,300 26,790
WE Retail Banking 36,395 34,506 4,756 3,511 2,516 3,322 43,667 41,339
Barclays Africa 203 142 1,598 1,520 1 11 1,802 1,673
Absa 23,988 20,492 2,447 2,282 3,260 3,859 29,695 26,633
Barclays Corporate 377 396 783 984 256 162 1,416 1,542
Barclays Wealth 5,882 5,620 2,096 1,822 5,531 2,474 13,509 9,916
Total 168,055 149,099 39,171 39,012 21,226 19,259 228,452 207,370
Notes
a Western Europe Retail Banking includes loans and advances to business customers at amortised cost.
b Barclays Corporate primarily includes retail portfolios in India, UAE and Russia.
Barclays PLC Annual Report 2010 www.barclays.com/annualreport10 101
Strategy Performance Financial statements Shareholder informationRisk management and governanceAbout Barclays