Highlights of the year
- Group profit before tax was £6,077m, down 14% on 2007. Profit included:
- Gains on acquisitions of £2,406m, including £2,262m relating to Lehman Brothers North American businesses
- Profit on disposal of the closed life assurance book of £326m
- Gains on Visa IPO and sales of shares in MasterCard of £291m
- Gross credit market losses and impairment of £8,053m
- Gains on own credit of £1,663m
- Global Retail and Commercial Banking profit before tax increased 6% to £4,367m
- UK lending increased to both retail and corporate customers
- Strengthened international presence in Barclaycard, Western Europe and Emerging Markets
- Investment Banking and Investment Management profit before tax was £2,568m,
down 24% reflecting significant gain on acquisition and disposal and the impact of credit
market dislocation
- Barclays Capital’s strategy of diversification by geography and business accelerated through the acquisition of Lehman Brothers North American businesses
- There were strong net new asset flows into Barclays Wealth and Barclays Global Investors despite declines in equity markets
- Group balance sheet growth was driven by over £900bn derivative gross-up, growth in loans and advances of £124bn and impact of foreign exchange rates on non-Sterling assets
- Risk weighted assets increased 22% (£79bn) to £433bn reflecting:
- the significant depreciation in Sterling relative to both the US Dollar and the Euro
- procyclicality: macroeconomic indicators generally, and corporate credit conditions specifically, deteriorated towards the end of 2008 leading to ratings declines
- Capital ratios were strengthened through the raising of £13.6bn of Tier 1 capital. The year-end pro forma Tier 1 capital ratio was 9.7% and the pro forma Equity Tier 1 ratio was 6.7%
- Barclays targets reduced adjusted gross leverage and capital ratios significantly ahead of regulatory requirements
Income
Profit before tax
Income statement highlights
For the year ended 31st December
| 2008 £m |
2007 £m |
2006 £m |
|
|---|---|---|---|
| Total income net of insurance claims | 23,115 | 23,000 | 21,595 |
| Impairment charges and other credit provisions | (5,419) | (2,795) | (2,154) |
| Operating expenses | (14,366) | (13,199) | (12,674) |
| Gains on acquisitions | 2,406 | - | - |
| Profit before tax | 6,077 | 7,076 | 7,136 |
| Profit attributable to equity holders of the parent | 4,382 | 4,417 | 4,571 |
| Basic earnings per share | 59.3p | 68.9p | 71.9p |
| Dividend per ordinary share | 11.5p | 34.0p | 31.0p |
| Return on average shareholders’ equity | 16.5% | 20.3% | 24.7% |
| Cost:income ratio | 62% | 57% | 59% |
| Number of staff | 156,300 | 134,900 | 122,600 |
Contribution to Group profit
Global Retail and Commercial Banking
£4,367m
- UK Retail Banking £1,369m
- Barclays Commercial Bank £1,266m
- Barclaycard £789m
- GRCB – Western Europe £257m
- GRCB – Emerging Markets £134m
- GRCB – Absa £552m
Investment Banking and
Investment Management
£2,568m
- Barclays Capital £1,302m
- Barclays Global Investors £595m
- Barclays Wealth £671m
