RNS No 6730e
BARCLAYS PLC
16th February 1999
PART FOUR
BARCLAYS PLC
ADDITIONAL INFORMATION
CHANGES IN GROUP STRUCTURE IN 1998
On 1st April 1998 the Group reorganised into four main business groupings
consisting of Retail Financial Services, Corporate Banking, Barclays Capital
and Barclays Global Investors. Comparative figures have been restated to
reflect the new structure.
RECENT DEVELOPMENTS
On 7th January 1999, Barclays announced that it had agreed to make a
contribution of #116m to the Administrators of British & Commonwealth
Holdings PLC (B&C) as part of the overall settlement of #150m of the
Atlantic litigation. It is expected that some #40m of this contribution
will be offset by insurance cover. The contribution and insurance offset
have been incorporated in these results.
This settlement brings to an end Barclays exposure in the litigation which
arose in connection with B&C's acquisition of Atlantic in 1988.
On 11th February 1999, Barclays announced the appointment of Michael O'Neill
as Group Chief Executive and a Board Director with effect from 26th March
1999.
ACCOUNTING POLICIES
During the year the Group implemented FRS 9 'Associates and Joint Ventures',
FRS 10 'Goodwill and Intangible Assets' and FRS 11 'Impairment of Fixed
Assets and Goodwill'. Implementation of these standards did not have a
significant effect on the Group's results.
There have been no other significant changes to the accounting policies as
described in the 1997 Annual report.
ACQUISITIONS AND DISPOSALS
There were no significant acquisitions in the period. Details of
significant disposals in the period are set out under exceptional items on
page 18.
CHANGES IN ACCOUNTING PRESENTATION
Income from the long-term insurance business now includes amounts previously
reported within Other income. Following a reassessment, certain BGI managed
funds previously reported within life-fund assets attributable to
policyholders are now more appropriately classified as funds under
management. Accordingly these funds, and their related liabilities, have
been excluded from the consolidated balance sheet.
Comparative numbers have been restated for the impact of these changes.
Total operating income and operating profit are not affected.
GROUP SHARE SCHEMES
The trustees of the Group's share schemes may make purchases of Barclays PLC
ordinary shares in the market following the announcement of the Group's
results in February 1999 for the purposes of those schemes' current and
future requirements. The total number of ordinary shares purchased would
not be material in relation to the issued share capital of Barclays PLC.
NOTES
1. Loans and advances to banks 1998 1997
#m #m
Banking business
Loans and advances to banks 20,357 21,751
Less - provisions (41) (22)
20,316 21,729
Trading business 16,296 15,155
Total loans and advances to 36,612 36,884
banks
Of the total loans and advances to banks placings with banks were
#32.8bn at 31st December 1998 (1997: #31.0bn). The majority of placings
have a residual maturity of less than one year.
2. Loans and advances to customers 1998 1997
#m #m
Banking business
Loans subject to non-recourse 278 327
finance arrangements
Less: non returnable finance (269) (319)
9 8
Loans and advances to customers 77,663 69,894
Finance lease receivables 5,776 6,122
83,448 76,024
Less - provisions (1,902) (1,828)
- interest in suspense (77) (85)
81,469 74,111
Trading business 14,641 25,712
Total loans and advances to 96,110 99,823
customers
3. Provisions for bad and doubtful
debts
1998 1997
Credit risk provisions #m #m
Provisions at beginning of year 1,761 2,050
Exchange and other adjustments 5 (53)
Amounts written off
United Kingdom (506) (441)
Other European Union (43) (93)
United States (7) (23)
Rest of the World (9) (14)
(565) (571)
Recoveries (analysed below) 176 126
Sub-total 1,377 1,552
Provisions charged against
profit:
New and increased specific
provisions
United Kingdom 751 536
Other European Union 31 49
United States 11 12
Rest of the World 23 28
816 625
Less: Releases of specific
provisions
United Kingdom (81) (143)
Other European Union (31) (34)
United States (8) (33)
Rest of the World (15) (15)
(135) (225)
Less: Recoveries
United Kingdom (156) (111)
Other European Union (4) (6)
United States (13) (4)
Rest of the World (3) (5)
(176) (126)
Net specific provisions charge 505 274
General provisions release (20) (65)
Net credit risk charge to 485 209
profit
Provisions at end of year 1,862 1,761
Country risk provisions
Provisions at beginning of year 89 80
Exchange and other adjustments 1 1
Amounts written off (net of (16) (10)
recoveries)
Net specific provision releases (13) (27)
General provision charge 20 45
Provisions at end of year 81 89
Total provisions at end of year 1,943 1,850
3. Provisions for bad and doubtful debts (continued)
Total provisions for bad and doubtful debts at end of year comprise:
1998 1997
Specific - credit risk #m #m
United Kingdom 928 765
Other European Union 213 245
United States 23 27
Rest of the World 35 41
1,199 1,078
Specific - country risk 16 44
Total specific provisions 1,215 1,122
General provisions - credit 663 683
risk
- country risk 65 45
1,943 1,850
The geographic analysis of provisions shown above is based on location
of office. The United Kingdom charge includes #153m raised in respect
of exposure to Russian counterparties.
4. Other assets 1998 1997
#m #m
Own shares 43 43
Balances arising from off- 13,725 17,124
balance sheet financial
instruments
Shareholders' interest in long- 530 460
term assurance fund
London Metal Exchange warrants 457 665
and other metals trading
positions
Sundry debtors 1,862 2,121
Prepayments and accrued income 2,552 2,305
19,169 22,718
'Own shares' represent Barclays PLC shares held in employee benefit
trusts that have not yet vested unconditionally with the eligible
employees.
5. Other liabilities 1998 1997
#m #m
Obligations under finance 141 157
leases payable
Balances arising from off- 15,849 18,703
balance sheet financial
instruments
Short positions in securities 13,682 13,170
Current tax 479 509
Sundry creditors 3,199 2,729
Accruals and deferred income 3,074 3,557
Provisions for liabilities and 1,272 1,454
charges
Dividend 414 359
38,110 40,638
6. Exposure to countries subject to International Monetary Fund liquidity
support programmes
Amounts outstanding, net of provisions, and commitments to
counterparties in countries which are subject to International Monetary
Fund liquidity support programmes were as follows:
1998 1997
Asia #bn #bn
Indonesia 0.1 0.3
South Korea 0.5 0.6
Thailand 0.1 0.3
0.7 1.2
Latin America
Brazil 0.9 0.8
Eastern Europe
Russia 0.0 0.1
1.6 2.1
Of the total of #1.6bn, #1.0bn (1997: #1.5bn) was related to banks,
#0.4bn (1997: #0.4bn) to governments and #0.2bn (1997: #0.2bn) to other
corporate bodies including project finance companies, and was mainly in
respect of loans, off-balance sheet financial instruments and debt
securities. Off-balance sheet financial instruments and debt securities
are marked to market.
The Group has a Brazilian associate, Banco Barclays e Galicia SA, which
is equity accounted. At 31st December 1998 the 50% holding was included
in the balance sheet at a value of #47m (included in the figures above).
Of the above exposures #35m (1997: #10m) were non-performing (interest
not being accrued) as at 31st December 1998. During the year the Group
raised a general provision of #20m in respect of country transfer risk
arising from its business world wide, including exposure in these
countries, bringing the total of such provisions to #65m at 31st
December 1998. This is in addition to #663m of general provision held
against credit risk.
7. Potential credit risk lendings
The following table presents an analysis of potential credit risk
lendings in accordance with the US Securities and Exchange Commission
guidelines. Additional categories of disclosure are included, however,
to record lendings where interest continues to be accrued and where
either interest is being suspended or specific provisions have been
raised. Normal US banking practice would be to place such lendings on
non-accrual status.
The amounts, the geographical presentation of which is based on the
location of the office recording the transaction, are stated before
deduction of the value of security held, specific provisions carried or
interest suspended.
Non-performing lendings 1998 1997
#m #m
Non-accrual lendings:
United Kingdom 985 911
Foreign 282 309
Accruing lendings where
interest is being suspended:
United Kingdom 266 234
Foreign 118 153
Other accruing lendings against
which provisions have been
made:
United Kingdom 457 408
Foreign 134 117
Sub-totals:
United Kingdom 1,708 1,553
Foreign 534 579
Accruing lendings 90 days
overdue, against which no
provisions have been made:
United Kingdom 309 388
Foreign 19 14
Reduced rate lendings:
United Kingdom 7 37
Foreign - -
Total non-performing lendings
United Kingdom 2,024 1,978
Foreign 553 593
2,577 2,571
UK non-performing lendings increased by #46m including exposures to
Russian counterparties. A further reduction in business in transition
balances was primarily responsible for the fall in overseas balances.
7. Potential credit risk lendings (continued)
Potential problem lendings: In addition to the above, the following
table shows lendings which are current as to payment of principal and
interest, but where serious doubt exists as to the ability of the
borrower to comply with repayment terms in the near future.
1998 1997
#bn #bn
United Kingdom 0.6 0.6
Foreign 0.1 0.1
0.7 0.7
1998 1997
Total provision coverage of: % %
- credit risk non-performing 75.2 71.8
lendings
- total potential credit risk 59.4 56.3
lendings
1998 1997
Interest forgone on non- #m #m
performing lendings:
Interest income that would have 182 218
been recognised under original
contractual terms
Interest income included in (63) (71)
profit
Interest forgone 119 147
8. European Economic and Monetary Union
The Group's preparations for EMU and the introduction of the euro on 1st
January 1999, required the effective management across the Group of a
wide range of changes and upgrades to systems, processes and procedures.
This culminated in the successful completion of its conversion weekend
activity on 3rd January 1999.
The original cost estimate for the Group's work on achieving euro
compliance, on the assumption that the United Kingdom did not
participate, was some #150m. Throughout 1998 efforts were concentrated
on providing the most benefit to our customers. As the markets and
payment/settlements infrastructure changes became more clearly defined
and more robust implementation plans were developed, the contingency
planning requirements were reduced. The estimated total cost reduced to
#120m at 30th June 1998, and is now expected to be #90m, of which some
#75m has been spent to date (#55m in 1998).
Further expenditure of #15m includes anticipated costs in respect of the
introduction of euro banknotes and coins in the Group's continental
European operations and further systems development within Corporate
Banking.
Barclays is continuing to monitor developments around the possibility of
the United Kingdom joining EMU. Planning has been undertaken in 1998 to
identify what further work would be required should the United Kingdom
decide to join EMU. In the meanwhile only limited preparations to UK
systems have been made and no significant expenditure will be incurred
until there is more certainty over a decision to enter.
9. Year 2000
The Barclays Group Year 2000 programme was initiated in early 1996 and
is responsible for ensuring that Year 2000 projects are in place across
the whole Group world wide. A Programme Board of executives from across
the Group is chaired by the Director, Planning, Operations and
Technology, who reports directly to the Group Deputy Chairman and Chief
Executive.
The Group has given priority to its mission critical computer systems
(those which would have an immediate and observable impact on the
Group's customers and therefore its ability to continue to operate
effectively). Over 90% of such systems were tested as Year 2000 ready
as at 31st December 1998, and this is forecast to rise to 98% by the end
of March 1999. The aim is to have all mission critical systems
including embedded systems, corrected and implemented by the end of June
1999.
The total cost of the Year 2000 Programme is estimated not to exceed
#250m (including #20m of capitalised costs) for the four year period
ending December 2000. The total amount spent on the Year 2000 Programme
to date is about #145m (including #15m of capitalised costs) of which
#105m was incurred in 1998. Year 2000 costs include correction,
testing, third party assurance and contingency planning.
10.Legal proceedings
Barclays is party to various legal proceedings, the ultimate resolution
of which is not expected to have a material adverse effect on the
financial position of the Group.
See pages 17 and 38 for details of the settlement with the
Administrators of British & Commonwealth Holdings PLC.
11. Geographical analysis
1998 1997
Profit before tax #m #m
United Kingdom 1,470 1,402
Other European Union 241 118
United States 67 96
Rest of the World 140 100
1,918 1,716
1998 1997
Total assets #m #m
United Kingdom 154,446 164,257
Other European Union 18,490 19,872
United States 24,886 25,667
Rest of the World 21,672 22,633
219,494 232,429
12. Contingent liabilities and commitments
1998 1997
Contingent liabilities #m #m
Acceptances and endorsements 1,384 1,602
Guarantees and assets pledged 8,784 6,623
as collateral security
Other contingent liabilities 5,069 5,123
15,237 13,348
Commitments
Standby facilities, credit 68,191 59,121
lines and other commitments
13.Off-balance sheet financial instruments, including derivatives
The tables set out below analyse the contract or underlying principal
amounts of derivative financial instruments held for trading purposes
and for the purposes of managing the Group's structural exposures.
Foreign exchange derivatives 1998 1997
#m #m
Contract or underlying
principal amount
Forward foreign exchange 263,958 337,276
Currency swaps 79,447 57,838
Other exchange rate related 101,310 177,860
contracts
444,715 572,974
Net replacement cost 4,262 9,402
Interest rate derivatives
Contract or underlying
principal amount
Interest rate swaps 787,486 664,722
Forward rate agreements 99,960 138,619
OTC options bought and sold 222,589 138,392
Other interest rate related 104,003 182,875
contracts
1,214,038 1,124,608
Net replacement cost 7,417 6,116
Equity, stock index and
commodity derivatives
Contract or underlying 51,347 45,420
principal amount
Net replacement cost 2,173 1,722
Other exchange rate related contracts are primarily OTC options. Other
interest rate related contracts are primarily exchange traded options
and futures.
Replacement cost or credit exposure on derivative instruments represents
the cost to replace contracts with a positive fair value if
counterparties failed completely to perform their obligations.
Replacement cost varies over time as the market price of the underlying
instrument varies.
14.Market risk
Market risk is the risk of loss arising from adverse movements in the
level or volatility of market prices, which can occur in the interest
rate, foreign exchange, equity and commodity markets. It is incurred as
a result of both trading and asset/liability management activities.
The market risk management policies of the Group are determined by the
Group Risk Management Committee, which also determines overall market
risk appetite. The Group's policy is that exposure to market risk
arising from trading activities is concentrated in Barclays Capital.
The Group's banking businesses are also subject to market risk, which
arises in relation to non-trading positions, such as capital balances,
demand deposits and customer originated transactions and flows.
Management responsibilities
In Barclays Capital, the formal process for the management of risk is
through the Barclays Capital Risk Management Committee. Day to day
responsibility for market risk lies with the Chief Executive of Barclays
Capital, supported by a dedicated global market risk management unit
that operates independently of the business areas.
Market risk measurement
The Group uses a 'value at risk' measure as the primary mechanism for
controlling market risk. Daily Value at Risk (DVAR) is an estimate,
with a confidence level of 98% of the potential loss which might arise
if the current positions were to be held unchanged for one business day.
Daily losses exceeding the DVAR figure are likely to occur, on average,
only twice in every one hundred business days. Actual outcomes are
monitored regularly to test the validity of the assumptions made in the
calculation of DVAR.
As in 1997, volatilities reached high levels in 1998 as a result of
market turbulence, leading to occasional sharp rises in DVAR. The peak
DVAR of #43.3m occurred in July following a significant increase in the
estimated volatilities relating to Russian government debt. In reaction
to this increased market turbulence, the non-client related proprietary
businesses in Barclays Capital were closed in October and secondary
market corporate bond inventory was substantially reduced during the
last quarter of 1998.
This reduction in risk contributed to a decrease in overall DVAR from
#22.8m at 30th June 1998 to #12.2m at 31st December 1998 (31st December
1997: #17.3m). During 1999 it is intended that Barclays Capital will
continue to operate in its current markets and pursue market
opportunities as appropriate.
The daily average, maximum and minimum values of DVAR were estimated as
below.
DVAR
Twelve months to Twelve months to
31st December 1998 31st December 1997
Average High* Low* Average High* Low*
#m #m #m #m #m #m
Interest rate 15.1 36.6 9.5 10.2 18.4 4.7
risk
Foreign exchange 5.8 13.9 1.2 5.4 21.9 0.7
risk
Equities risk 3.0 7.9 1.3 2.3 3.4 1.5
Commodities risk 1.2 2.9 0.6 1.4 2.9 0.4
Diversification (4.2) (3.6)
effect
Total DVAR 20.9 43.3 12.2 15.7 35.1 7.0
* The high (and low) DVAR figures reported for each category did not
necessarily occur on the same day as the high (and low) DVAR reported
as a whole. A corresponding diversification effect cannot be
calculated and is therefore omitted from the above table.
The above figures for 1997 include market risk taken by the former BZW
businesses that have been sold or closed. The calculation of the market
risk relating to Barclays Capital and the former BZW businesses cannot
be precisely separated, but based on reasonable assumptions, it can be
estimated that the DVAR in Barclays Capital businesses would have
accounted for the substantial majority of the total DVAR for the
combined businesses as detailed above.
15.US GAAP
There are some significant differences between accounting practices in
the United States (US GAAP) and those in the United Kingdom (UK GAAP).
Key figures on a UK GAAP basis and as estimated on a US GAAP basis are:
1998 1998 1997 1997
#m #m #m #m
UK GAAP US GAAP UK GAAP US GAAP
Net income 1,335 1,370 1,130 1,274
Shareholders' funds 7,923 7,781 7,620 7,409
BARCLAYS PLC
CONSOLIDATED STATEMENT OF CHANGES IN
SHAREHOLDERS' FUNDS
1998 1997
#m #m
At beginning of year 7,620 7,267
Proceeds of shares issued (net of 110 113
expenses)
Exchange rate translation 32 (101)
differences
Repurchase of ordinary shares* (501) (351)
Goodwill written back on disposals 10 126
Shares issued in relation to share (67) -
option schemes for staff**
Other items 30 (1)
Profit retained 689 567
At end of year 7,923 7,620
* Including nominal amount of #29m (1997: #30m).
** The Group has established a Qualifying Employee Share Ownership Trust
(QUEST) for the purposes of the Group's Save As You Earn Share Option
Scheme.
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
1998 1997
#m #m
Profit attributable to the members 1,335 1,130
of Barclays PLC
Exchange rate translation 32 (101)
differences
Other items 30 -
Total recognised gains relating to 1,397 1,029
the period
SUMMARY CONSOLIDATED CASH FLOW STATEMENT
Note 1998 1997
#m #m
Net cash(outflow)/inflow from 1 (1,337) 8,979
operating activities
Dividends received from 3 7
associated undertakings
Net cash outflow from returns (252) (303)
on investment and servicing
of finance
Tax paid (547) (263)
Net cash inflow /(outflow) 2,333 (7,513)
from capital expenditure and
financial investment
Acquisitions and disposals 584 50
Equity dividend paid (591) (445)
Net cash inflow before 193 512
financing
Net cash inflow/(outflow) 264 (468)
from financing
Increase in cash 457 44
NOTE TO CONSOLIDATED CASHFLOW STATEMENT
1998 1997
#m #m
1 Operating profit 1,921 2,160
Provisions for bad and 492 227
doubtful debts
Depreciation and amortisation 270 266
Net (decrease)/increase in (719) 729
accrued expenditure and
prepayments
Provisions for contingent 76 4
liabilities and commitments
Interest on dated and undated 244 265
loan capital and other
subordinated liabilities
Associated undertakings - (22) (16)
profit included
Increase in shareholders' (95) (19)
interest in the UK long-term
assurance fund
Profit on (3) (2)
redemption/repurchase of loan
capital
Net (increase)/decrease in net (23) 70
interest and commission
receivable
Net profit on disposal of (106) (104)
investments and fixed assets
Other non-cash movements 53 13
2,088 3,593
Net change in items in transit (311) 500
and items in course of
collection
Net (decrease)/increase in (4,197) 14,365
other credit balances
Net decrease/(increase) in 8,652 (21,324)
loans and advances to banks
and customers
Net (decrease)/increase in (14,958) 33,695
deposits and debt securities
in issue
Net decrease/(increase) in 3,215 (5,516)
other assets
Net decrease/(increase) in 3,642 (15,122)
other debt securities and
equity shares
Net decrease/(increase) in 777 (1,226)
treasury and other eligible
bills
Other non-cash movements (245) 14
Net cash (outflow)/inflow from (1,337) 8,979
operating activities
OTHER INFORMATION
Financial Summary 1998 1997 1996 1995 1994
#m #m #m #m #m
Profit before tax 1,918 1,716 2,306 2,017 1,831
Profit after tax 1,380 1,174 1,686 1,407 1,251
Total capital resources 11,971 10,873 10,674 11,021 10,152
p p p p p
Earnings per ordinary 88.4 74.4 104.2 83.6 72.4
share
Dividends per ordinary 43.0 37.0 31.5 26.0 21.0
share
Net asset value per 525 498 472 433 377
ordinary share
Dividend cover (times) 2.1 2.0 3.4 3.2 3.4
Risk asset ratios: % % % % %
Tier 1 ratio 7.4 7.3 7.6 7.7 7.0
Total ratio 10.7 10.0 10.4 10.9 10.4
Performance ratios
Return on average % % % % %
shareholders' funds:
Pre-tax 23.7 22.1 31.3 29.8 30.7
Post-tax 17.0 15.0 22.8 20.7 20.7
Return on average total
assets:
Pre-tax 0.8 0.8 1.3 1.2 1.1
Post-tax 0.6 0.5 0.9 0.8 0.7
Return on average
weighted risk assets:
Pre-tax 1.8 1.6 2.3 2.3 1.9
Post-tax 1.3 1.1 1.7 1.5 1.3
Non interest income/total 41.3* 46.5** 47.8 47.4 47.4
income
Non interest 62.7 68.9** 70.9 68.7*** 71.4
income/operating expenses
* Excluding the impact of the Finance Act 1998.
**Excluding the impact of the Finance (No 2) Act 1997.
***Excluding the provision for diminution in property value.
The financial information above is extracted from the published accounts for
the last five years, restated where appropriate to accord with the current
accounting policies of the Group.
OTHER INFORMATION (CONTINUED)
PROFIT BEFORE TAX 31.12.98 30.6.98 31.12.97 30.6.97
(half-year ended - unaudited) #m #m #m #m
Retail Financial Services* 787 732 619 668
Corporate Banking* 437 535 434 487
Barclays Capital (424) 159 107 145
Barclays Global Investors 23 29 23 28
Businesses in Transition** 24 24 46 47
Other operations (88) (96) (64) 8
Head office functions (35) (25) (28) (24)
Goodwill amortisation (6) (6) (6) (6)
Provision for litigation (76) - - -
settlement***
642 1,352 1,131 1,353
Former BZW businesses (14) (19) (200) (19)
Exceptional items 5 (4) (467) 42
Write-down of leases - (40) - (77)
Life-fund charge - - - (28)
Write-down of fixed asset (4) - (19) -
investments
629 1,289 445 1,271
31.12.98 30.6.98 31.12.97 30.6.97
TOTAL ASSETS #m #m #m #m
Retail Financial Services 46,150 42,671 41,698 41,635
Corporate Banking 42,853 39,948 36,505 35,432
Barclays Capital 117,194 152,665 134,680 123,378
Barclays Global Investors 183 167 161 122
Businesses in Transition
- former BZW businesses - 88 8,477 15,030
- other 554 443 771 1,247
Other operations and Head 5,475 6,223 4,178 4,768
office functions
Retail life-fund assets 7,085 6,751 5,959 5,425
attributable to
policyholders
219,494 248,956 232,429 227,037
WEIGHTED RISK ASSETS
Retail Financial Services 31,493 29,705 28,514 28,178
Corporate Banking 41,679 38,357 35,286 33,594
Barclays Capital 31,172 37,858 34,942 32,187
Barclays Global Investors 207 150 141 120
Businesses in Transition
- former BZW businesses - 61 4,078 4,515
- other 594 470 801 1,309
Other operations**** 4,636 4,906 4,565 4,507
109,781 111,507 108,327 104,410
* Figures are stated prior to the impact of the Finance (No.2) Act 1997 and
the Finance Act 1998.
** Businesses in Transition profit before tax excludes the results of
former BZW businesses which are shown separately.
***The 1998 provision relates to the settlement of the litigation brought
by the Administrators of British & Commonwealth Holdings PLC.
****Including supervisory adjustments.
OTHER INFORMATION (CONTINUED)
Consolidated profit and loss account by half-year (unaudited)
31.12.98 30.6.98 31.12.97 30.6.97
#m #m #m #m
Interest receivable 4,938 5,014 4,797 4,407
Interest payable (2,726) (2,874) (2,717) (2,374)
Write-down of leases - (40) - (77)
Profit on - 3 (2) 4
redemption/repurchase of
loan capital
Net interest income 2,212 2,103 2,078 1,960
Net fees and commissions 1,429 1,350 1,520 1,459
receivable
Dealing profits (230) 197 140 234
Other operating income 168 156 92 136
Life-fund charge - - - (28)
Total non-interest income 1,367 1,703 1,752 1,801
Operating income 3,579 3,806 3,830 3,761
Administration expenses - (1,425) (1,386) (1,573) (1,462)
staff costs
Administration expenses - (949) (861) (1,039) (857)
other
Depreciation and (138) (137) (141) (128)
amortisation
Operating expenses (2,512) (2,384) (2,753) (2,447)
Operating profit before 1,067 1,422 1,077 1,314
provisions
Provisions for bad and (363) (129) (137) (90)
doubtful debts
Provisions for contingent (76) - (9) 5
liabilities etc
Operating profit 628 1,293 931 1,229
Exceptional items 5 (4) (467) 42
Write-down of fixed asset (4) - (19) -
investments
Profit on ordinary 629 1,289 445 1,271
activities before tax
Tax on profit on ordinary (158) (380) (196) (346)
activities
Profit on ordinary 471 909 249 925
activities after tax
Minority interests (equity (23) (22) (22) (22)
and non-equity)
Profit attributable to the 448 887 227 903
members of Barclays PLC
Dividends (414) (232) (359) (204)
Profit retained 34 655 (132) 699
Earnings per ordinary 30.0 p 58.4 p 15.2 p 59.2 p
share
Dividends per ordinary 27.5 p 15.5 p 23.5 p 13.5 p
share
OTHER INFORMATION (CONTINUED)
Results by half year (unaudited)
31.12.98 30.6.98 31.12.97 30.6.97
#m #m #m #m
Net interest income* 2,213 2,144 2,076 2,031
Net fees and commissions 1,431 1,340 1,358 1,294
receivable
Dealing profits (225) 198 137 205
Other operating income 165 154 94 128
Total non-interest 1,371 1,692 1,589 1,627
income*
Operating income* 3,584 3,836 3,665 3,658
Operating expenses* (2,503) (2,355) (2,388) (2,220)
Operating profit before 1,081 1,481 1,277 1,438
provisions*
Provisions for bad and (363) (129) (137) (90)
doubtful debts
Provisions for contingent (76) - (9) 5
liabilities
Operating profit* 642 1,352 1,131 1,353
Former BZW businesses (14) (19) (200) (19)
Exceptional items 5 (4) (467) 42
Write-down of leases - (40) - (77)
Life-fund charge - - - (28)
Write-down of fixed asset (4) - (19) -
investments
Profit before tax 629 1,289 445 1,271
* Figures exclude the results of the former BZW businesses and are stated
prior to the impact of the Finance Act (No. 2) 1997 and the Finance Act
1998.
KEY FACTS (UNAUDITED)
1998 1997
RETAIL FINANCIAL SERVICES
UK Retail Bank
Number of branches (UK only excl. 1,950 1,975
CI & IOM)
Number of current accounts 7.7m 7.4m
Customers registered for 850,000 560,000
Barclaycall
Customers registered for On Line 205,000 28,000
banking
Small business customers 434,000 417,000
Barclaycard
Barclaycards in issue 10m 10m
Number of merchant transactions 1.0bn 0.9bn
processed
International Premier, Private,
Savings and Investment
Premier clients 112,000 87,000
ERBG - number of customers 278,000 268,000
Savings accounts 3.5m 3.2m
Sales through BarclaysLife #149m #119m
salesforce
Barclays Stockbrokers deal volumes 5,800 6,800
per day
Customers' funds #72.7bn #62.0bn
Africa and the Caribbean
Countries with Barclays 25 25
representation
Customer deposits #4.2bn #3.8bn
CORPORATE BANKING
Number of UK Corporate Banking 110,700 108,700
connections
- Core connections 95,000 94,000
- Complex connections 14,000 13,000
- Large connections 1,700 1,700
Customers registered for 20,000 11,000
electronic banking
Number of current accounts 220,000 215,000
For further information; please contact:
Oliver Stocken
Finance Director
0171-699 2944 - Direct Line
0171-699 5000 - Switchboard
Ian Roundell
Head of Investor Relations
0171-699 2961 - Direct Line
Leigh Bruce
Director, Corporate Communications
0171-699-2658 - Direct Line
More information on Barclays, including the 1998 results, can be found on
our website at the following address : http://www.investor.barclays.com
END
FRCALLERFTIELAA
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