Barclays 2013 Annual Report Download - page 260

2013
Income improved 10% to £4,786m reflecting continued net lending
growth and contributions from 2012 portfolio acquisitions. UK income
increased 6% to £2,747m reflecting net lending growth and lower
funding costs. International income improved 17% to £2,039m
reflecting contributions from 2012 portfolio acquisitions and higher
customer asset balances in the US and Germany.
Net interest income increased 10% to £3,318m driven by volume
growth and a lower impact from structural hedges. Customer asset
margin remained broadly stable at 9.39% with average customer assets
increasing 8% to £36.3bn due to 2012 portfolio acquisitions and
business growth. Customer liability margin was negative 0.29%
reflecting deposit funding initiatives in the US and Germany.
Net fee and commission income improved 11% to £1,435m due to
increased payment volumes, predominantly in the US and UK.
Credit impairment charges increased 20% to £1,264m primarily driven
by the impact of portfolio acquisitions, and non-recurrence of provision
releases in 2012. Impairment loan loss rates on consumer credit cards
remained broadly stable at 366bps (2012: 359bps) in the UK, remained
flat at 268bps in the US, and increased by 421bps to 581bps in South
Africa due to the Edcon acquisition driving a change in product mix.
30 day arrears rates for consumer cards in the UK were down 10bps to
2.4%, in the US were down 30bps to 2.1% and in South Africa were up
70bps to 8.1%.
Adjusted operating expenses increased 11% to £2,048m reflecting
increased costs from 2012 portfolio acquisitions, net lending growth,
higher operating losses and costs to achieve Transform. Statutory
operating expenses increased 21% to £2,738m due to the increased
charge for PPI redress of £690m (2012: £420m).
Adjusted profit before tax improved 2% to £1,507m driven by the US
and UK card portfolios, while statutory profit before tax decreased to
£817m (2012: £1,062m) due to the increased charge for PPI redress.
Total assets increased 2% to £38.9bn primarily driven by the increase
in loans and advances to customers across the UK and international
businesses.
Customer deposits increased by £2.4bn to £5.2bn due to funding
initiatives in the US and Germany.
CRD III RWAs increased 9% to £41.1bn primarily driven by asset growth
and model changes in order to meet changes in regulatory guidance.
£4,786m
total income net of insurance claims
Up from £4,344m in 2012
£1,507m
adjusted profit before tax
Up from £1,482m in 2012
Financial review
Analysis of results by business continued
Barclaycard
Notes
a Adjusted profit before tax and adjusted attributable profit excludes the impact of the provision for PPI redress of £690m (2012: £420m; 2011: £600m) and goodwill impairment in
Firstplus secured lending portfolio of £nil (2012: £nil; 2011: £47m).
b Adjusted attributable profit represents profit after tax excluding non-controlling interests’ share of those profits.
c 2013 total assets and risk weighted assets include an allocation of liquidity pool assets previously held centrally.
2013
£m
2012
£m
2011
£m
Income Statement Information
Net interest income 3,318 3,009 3,047
Net fee and commission income 1,435 1,292 1,201
Net premiums from insurance contracts 26 36 42
Other income 7 7 16
Total income net of insurance claims 4,786 4,344 4,306
Credit impairment charges and other provisions (1,264) (1,049) (1,312)
Net operating income 3,522 3,295 2,993
Operating expenses (excluding UK bank levy, costs to achieve Transform, provision for PPI redress and
goodwill impairment) (1,975) (1,826) (1,796)
UK bank levy (24) (16) (16)
Costs to achieve Transform (49) – –
Provision for PPI redress (690) (420) (600)
Goodwill impairment –– (47)
Operating expenses (2,738) (2,262) (2,459)
Other net income 33 29 31
Profit before tax 817 1,062 565
Adjusted profit before taxa1,507 1,482 1,212
Adjusted attributable profita,b 1,006 975 780
Balance Sheet Information
Loans and advances to customers at amortised cost £35.6bn £33.8bn £31.0bn
Customer deposits £5.2bn £2.8bn £0.6bn
Total assetsc£38.9bn £38.2bn £34.8bn
Risk weighted assets – CRD IIIc£41.1bn £37.8bn £35.2bn
Risk weighted assets – CRD IV fully loadedc£40.5bn
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258 Barclays PLC Annual Report 2013