Barclays 2012 Annual Report Download - page 120

Balance sheet concentrations of credit risk
A concentration of credit risk exists when a number of counterparties are located in a geographical region or are engaged in similar activities
and have similar economic characteristics that would cause their ability to meet contractual obligations to be similarly affected by changes
in economic or other conditions. The Group implements limits on concentrations in order to mitigate the risk. The analyses of credit risk
concentrations presented below are based on the location of the counterparty or customer or the industry in which they are engaged.
Further detail on the Group’s policies with regard to managing concentration risk is presented on page 322.
Geographic concentrations
As at 31 December 2012, the geographic concentration of the Group’s assets remained broadly consistent with 31 December 2011.
For balance sheet assets, the most significant change in concentrations was for cash held at central banks, with cash held as part of the liquidity
pool moving from lower yielding Sterling and US Dollar accounts to higher yielding Euro and Swiss Franc accounts. There was also a notable
increase in the proportion of available for sale debt securities issued by counterparties in Europe, primarily high quality bonds forming part of the
Group liquidity pool. This increase was accompanied by a reduction in the proportion of debt securities issued by Asian (predominantly Japanese)
and UK counterparties.
Within off-balance sheet, there was a significant reduction in the concentration of exposures in the Americas due to the cessation of the securities
lending arrangements contracted with BlackRock, Inc. upon the disposal of Barclays Global Investors in 2009. Further detail on this transaction is
included in Note 28.
An analysis of geographical and industry concentration of Group loans and advances held at amortised cost and at fair value is presented on
pages 125-126. Information on exposures to Eurozone countries is presented on pages 143-154.
Credit risk concentrations by geography (audited)
As at 31 December 2012
United
Kingdom
£m
Europe
£m
Americas
£m
Africa and
Middle East
£m
Asia
£m
Total
£m
On-balance sheet:
Cash and balances at central banks 3,547 70,159 6,566 2,354 3,549 86,175
Items in the course of collection from other banks 788 296 – 371 1 1,456
Trading portfolio assets 16,408 21,386 62,875 2,985 13,509 117,163
Financial assets designated at fair value 24,100 3,546 5,644 1,947 604 35,841
Derivative financial instruments 147,651 157,609 127,367 4,264 32,255 469,146
Loans and advances to banks 7,506 14,942 12,278 2,110 3,653 40,489
Loans and advances to customers 228,007 81,442 63,252 46,093 6,935 425,729
Reverse repurchase agreements and other similar secured lending 29,565 25,743 98,313 4,133 19,202 176,956
Available for sale debt securities 24,024 29,803 11,128 7,103 2,619 74,677
Other assets 987 332 328 290 64 2,001
Total on-balance sheet 482,583 405,258 387,751 71,650 82,391 1,429,633
Off-balance sheet:
Securities lending arrangements – – – – – –
Guarantees and letters of credit pledged as collateral security 6,135 2,560 4,772 2,131 257 15,855
Acceptances, endorsements and other contingent liabilities 4,208 812 273 211 498 6,002
Documentary credits and other short term trade related transactions 629 103 – 295 – 1,027
Standby facilities, credit lines and other commitments 94,070 38,926 91,574 21,637 1,609 247,816
Total off-balance sheet 105,042 42,401 96,619 24,274 2,364 270,700
Total 587,625 447,659 484,370 95,924 84,755 1,700,333
barclays.com/annualreport118 I Barclays PLC Annual Report 2012
Risk review
Credit risk continued