Barclays 2013 Annual Report Download - page 250

Financial review
Balance sheet commentary
Total assets
Total assets decreased £176bn to £1,312bn principally reflecting lower
derivative assets due to increases in forward interest rates and
exposure reduction initiatives with central clearing parties and a
reduction in cash and balances at central banks due to a decrease in
the liquidity pool.
Cash and balances at central banks and items in course of collection
from other banks decreased £41bn to £47bn as the cash contribution
to the Group liquidity pool was reduced.
Trading portfolio assets deceased £13bn to £133bn due to a reduction
in debt securities and other eligible bills driven by a decrease in trading
activity within the rates business within the Investment Bank. This
decrease was partially offset by an increase in equity securities
reflecting higher client volume in the equities and prime services
businesses in the Investment Bank.
Financial assets designated at fair value decreased by £8bn to £39bn
primarily reflecting decreases in debt securities due to the unwinding
of deals.
Derivative financial assets decreased £145bn to £324bn primarily
driven by a reduction in interest rate derivatives reflecting the decrease
in mark-to-market valuations driven by increases in the major interest
rate forward curves and balance sheet reduction initiatives.
Available for sale investments increased £17bn to £92bn primarily
driven by an increase in debt securities in the liquidity pool as the mix
of the pool is being adjusted from cash to eligible securities to
increase returns.
Total loans and advances to banks and customers remained stable at
£468bn (2012: £464bn) including increased settlement balances of
£8.5bn, £4.4bn additional balances in UK RBB acquired through
Barclays Direct, £1.8bn growth within Barclaycard across the UK and
international business and a £1.8bn increase within Wealth and
Investment Management. These increases were offset by a £5.7bn
decrease within South Africa primarily due to the depreciation of ZAR
against GBP.
Reverse repurchase agreements increased by £10bn to £187bn, driven
by increased matched book trading opportunities and trading desks’
funding requirements.
Total liabilities
Total liabilities decreased £180bn to £1,248bn.
Deposits from banks decreased by £22bn to £55bn primarily driven by
reduction in cash collateral due to lower derivative mark to market and
reduced liquidity requirements.
Customer accounts increased by 11% to £428bn due to a £19.5bn
increase in UK RBB deposits, a £15.2bn increase in settlements and
cash collateral balances within the Investment Bank, a £9.6bn increase
within Wealth and Investment Management, primarily reflected in the
High Net Worth business, and a £9.1bn increase in the Corporate Bank,
from UK deposit growth.
Repurchase agreements and other similar secured borrowing
decreased £20bn to £197bn driven by a reduction in trading desks’
funding requirements partially offset by increased matched book
trading.
Trading portfolio liabilities increased £9bn to £53bn primarily driven by
increases in equity securities and debt securities.
Financial liabilities designated at fair value decreased £14bn to £65bn
primarily reflecting trade maturities, buybacks/unwinding of existing
notes due to favourable market conditions and reduced funding
requirements.
Derivative financial liabilities decreased £142bn to £321bn in line with
the decrease in derivative assets.
Debt securities in issue decreased £33bn to £87bn due to non-renewal
of certificates of deposit and commercial paper primarily driven by
reduced funding requirements.
Subordinated liabilities decreased by £2bn to £22bn due to
redemptions in the year of subordinated notes, exchange movements
and fair value hedge movements. This was partially offset by the
issuance of £652m of Contingent Capital Notes (CCNs) and £48m
of other subordinated fixed rate notes.
Shareholders’ equity
Total shareholders’ equity increased £4bn to £64bn.
Share capital and share premium increased by £7bn to £20bn reflecting
an increase of £5.8bn from the issuance of 3.2bn additional shares
through the rights issue. Other equity instruments increased by £2.1bn
due to the issuance of equity accounted AT1 securities. Retained
earnings decreased £1bn to £33bn driven by dividends paid of £0.9bn
and a £0.5bn reduction due to an increase in retirement benefit
liabilities.
The available for sale reserve decreased £0.4bn to £0.1bn driven by net
losses on the fair value of debt securities held as part of the liquidity
pool, offset partially by gains from fair value movements on hedging
instruments.
Currency translation reserve decreased £1.2bn to £1.1bn, largely due to
the strengthening of GBP against the USD and ZAR.
Non-controlling interests decreased £0.8bn to £8.6bn, primarily
reflecting dividend payments of £0.8bn and currency translation
movements of £0.6bn due to the depreciation of ZAR against GBP.
These movements were offset by profit after tax of £0.8bn.
Net asset value per share decreased 20% to 331p and net tangible
asset value per share decreased 19% to 283p. The decreases were
mainly attributable to the issuance of shares as part of the rights issue,
and decreases in the cash flow hedging and currency translation
reserves.
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248 Barclays PLC Annual Report 2013