Barclays 2014 Annual Report Download - page 277

barclays.com/annualreport Barclays PLC Annual Report 2014 I 275
Notes to the financial statements
Assets and liabilities held at fair value
13 Trading portfolio
Accounting for trading portfolio assets and liabilities
In accordance with IAS 39, all assets and liabilities held for trading purposes are held at fair value with gains and losses in the changes in fair
value taken to the income statement in net trading income (Note 5).
Trading portfolio assets Trading portfolio liabilities
2014
£m
2013
£m
2014
£m
2013
£m
Debt securities and other eligible bills 65,997 84,560 (28,739) (40,445)
Equity securities 44,576 42,659 (16,022) (12,947)
Traded loans 2,693 1,647 – –
Commodities 1,451 4,203 (363) (72)
Trading portfolio assets/(liabilities) 114,717 133,069 (45,124) (53,464)
14 Financial assets designated at fair value
Accounting for financial assets designated at fair value
In accordance with IAS 39, financial assets may be designated at fair value, with gains and losses taken to the income statement in net trading
income (Note 5) and net investment income (Note 6). The Group has the ability to make the fair value designation when holding the
instruments at fair value reduces an accounting mismatch (caused by an offsetting liability or asset being held at fair value), or is managed by
the Group on the basis of its fair value, or includes terms that have substantive derivative characteristics (Note 15 Derivative financial
instruments).
The details on how the fair value amounts are arrived for financial assets designated at fair value are described in fair value of assets and
liabilities (Note 18).
2014
£m
2013
£m
Loans and advances 20,198 18,695
Debt securities 4,448 842
Equity securities 6,306 11,824
Reverse repurchase agreements 5,236 5,323
Customers’ assets held under investment contracts 1,643 1,606
Other financial assets 469 678
Financial assets designated at fair value 38,300 38,968
Credit risk of loans and advances designated at fair value and related credit derivatives
The following table shows the maximum exposure to credit risk, the changes in fair value attributable to changes in credit risk, and the cumulative
changes in fair value since initial recognition together with the amount by which related credit derivatives mitigate this risk:
Maximum exposure as at
31 December
Changes in fair value
during the year ended
Cumulative changes in
fair value from inception
2014
£m
2013
£m
2014
£m
2013
£m
2014
£m
2013
£m
Loans and advances designated at fair value, attributable to credit riska 20,198 18,695 (112) 158 (828) (511)
Value mitigated by related credit derivativesa 359 268 – (14) 18 131
Note
a 2013 balances have been revised to better reflect the credit risk disclosures relating to loans and advances at fair value and credit derivatives.
The notes included in this section focus on assets and liabilities the Group holds and recognises at fair value. Fair value
refers to the price that would be received to sell an asset or the price that would be paid to transfer a liability in an arms
length transaction with a willing counterparty, which may be an observable market price or, where there is no quoted
price for the instrument, may be an estimate based on available market data. Detail regarding the Group’s approach to
managing market risk can be found on pages 130 and 131.
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