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| Creating positive outcomes  for our stakeholders | | | | |  | | | |  |
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|  | Our Purpose | Working together for a better financial future | | | | | | |  |
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|  | Our Vision | The UK-centred leader in global finance  A comprehensive and pre-eminent UK consumer, corporate, wealth and private banking franchise  The leading non-US based investment bank  A strong, specialist US consumer bank | | | | | | |  |
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|  | Our Values | Respect  We harness the power  of diversity and inclusion in our  business, trust those we work  with, and value everyone’s  contribution | | Integrity  We operate with honesty,  courage, transparency  and fairness in all we do | Service  We act with empathy  and humility, putting the  people and businesses  we serve at the centre of  what we do | Excellence  We set high standards for  what we do, championing  innovation and using  our energy, expertise  and resources to make  a positive difference | | Stewardship  We prize sustainability,  and are passionate about  leaving things better than  we found them |  |
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|  |  | BARCLAYS_AR2023_WELCOME2.jpg |  |  |  | BARCLAYS_AR2023_WELCOME3.jpg |  |  |  | BARCLAYS_AR2023_WELCOME4.jpg |  |  |  | Investors_Small.jpg |  |  |
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| Strategic  report | | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 01 |
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| Welcome to Barclays | | | | | | | | | | |

Working together for

### a better financial future

Note:

1 Excluding the impact of Q423 structural cost actions.

Barclays supports individuals and small businesses

through our consumer banking services, and larger

businesses and institutions through our corporate and

investment banking services. Barclays is diversified by

business, geography and income type.

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|  |  | Financial headlines | | | | | | | | |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | £6.6bn1  Profit before tax  (PBT) | | 32.4p1  Earnings per share  (EPS) | | | | | 10.6%1  Return on tangible equity  (RoTE) | |  |  |
|  |  | Customers and clients | | |  |  |  | Colleagues | | |  |  |
|  |  | 7.3m  personal customers who Barclays helped  to open a new savings account or grow  their deposits with us (2023) | | |  |  |  | 86%  of colleagues would recommend Barclays  as a great place to work (2023) | | |  |  |
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|  |  | Society | | |  |  |  | Investors | | |  |  |
|  |  | 3.27m  people upskilled by Barclays (2023) | | |  |  |  | 37%  increase in announced 2023  capital distribution  versus 2022 | | |  |  |
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| Strategic  report | | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 02 |
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| The Group at a glance | | | | | | | | | | |

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| Parts 1, 2 and 3 of Barclays PLC 2023  Annual Report together comprise  Barclays PLC’s annual accounts and  report for the purposes of Section  423 of the Companies Act 2006.  Please note that throughout the  document, graphical representation of  component parts may not sum due to  rounding.  Strategic report  The Barclays PLC Strategic report 2023  was approved by the Board of Directors  on 19 February 2024 and signed on its  behalf by the Chairman.  The Strategic report 2023 is not the  Group’s statutory accounts. It does not  contain the full text of the Directors’  report, and it does not contain sufficient  information to allow as full an  understanding of the results and state  of affairs of the Group and of its policies  and arrangements concerning  Directors’ remuneration as would be  provided by the full Annual Report 2023. |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Inside Part 1  Strategic report |  |  | Our stakeholders | [23](#i4be61753b7f243b19551b0bfbf3a2a0d_10994) |  | Inside Part 2 |  |  | Inside Part 3 |  |  |
|  |  |  |  | Customers and clients | [24](#i4be61753b7f243b19551b0bfbf3a2a0d_42880953494305) |  | [Climate and sustainability report](#i4be61753b7f243b19551b0bfbf3a2a0d_244) | [59](#i4be61753b7f243b19551b0bfbf3a2a0d_244) |  | [Governance](#i4be61753b7f243b19551b0bfbf3a2a0d_442) | [140](#i4be61753b7f243b19551b0bfbf3a2a0d_430) |  |
|  |  | Welcome to Barclays | [1](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686055746) |  | Colleagues | [27](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680650) |  | Risks and opportunities | [66](#i4be61753b7f243b19551b0bfbf3a2a0d_250) |  | [Board governance](#i4be61753b7f243b19551b0bfbf3a2a0d_448) | [144](#i4be61753b7f243b19551b0bfbf3a2a0d_448) |  |
|  |  | The Group at a glance | [2](#i4be61753b7f243b19551b0bfbf3a2a0d_63221918607682) |  | Society | [30](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680602) |  | Implementing our  climate strategy | [72](#i4be61753b7f243b19551b0bfbf3a2a0d_259) |  | [Directors’ report](#i4be61753b7f243b19551b0bfbf3a2a0d_451) | [145](#i4be61753b7f243b19551b0bfbf3a2a0d_451) |  |
|  |  | [In this year's report](#i4be61753b7f243b19551b0bfbf3a2a0d_40) | [3](#i4be61753b7f243b19551b0bfbf3a2a0d_40) |  | Investors | [34](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680747) |  |  |  | [Remuneration report](#i4be61753b7f243b19551b0bfbf3a2a0d_520) | [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) |  |
|  |  | Chairman’s introduction | 4 |  | Additional disclosure | [37](#i4be61753b7f243b19551b0bfbf3a2a0d_11664) |  | Resilience of our strategy | [130](#i4be61753b7f243b19551b0bfbf3a2a0d_406) |  | [Other governance](#i4be61753b7f243b19551b0bfbf3a2a0d_550) | [230](#i4be61753b7f243b19551b0bfbf3a2a0d_550) |  |
|  |  | Chief Executive’s review | [7](#i4be61753b7f243b19551b0bfbf3a2a0d_62672162794841) |  | [Section 172(1) statement](#i4be61753b7f243b19551b0bfbf3a2a0d_17101) | [38](#i4be61753b7f243b19551b0bfbf3a2a0d_17101) |  |  |  |  | [Risk review](#i4be61753b7f243b19551b0bfbf3a2a0d_580) | [254](#i4be61753b7f243b19551b0bfbf3a2a0d_580) |  |
|  |  | Our business model | [10](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686056057) |  | Non-financial and sustainability  information statement | [40](#i4be61753b7f243b19551b0bfbf3a2a0d_217) |  |  |  |  | [Risk review contents](#i4be61753b7f243b19551b0bfbf3a2a0d_586) | [255](#i4be61753b7f243b19551b0bfbf3a2a0d_583) |  |
|  |  | [Our strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_10551) | [11](#i4be61753b7f243b19551b0bfbf3a2a0d_10551) |  |  |  |  |  |  | [Risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_589) | [256](#i4be61753b7f243b19551b0bfbf3a2a0d_589) |  |
|  |  | Our business environment | [12](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686057137) |  | Task Force on Climate-related  financial disclosure statement of  compliance | [48](#i4be61753b7f243b19551b0bfbf3a2a0d_226) |  |  |  |  | [Material existing](#i4be61753b7f243b19551b0bfbf3a2a0d_610)  [and emerging risks](#i4be61753b7f243b19551b0bfbf3a2a0d_610) | [258](#i4be61753b7f243b19551b0bfbf3a2a0d_610) |  |
|  |  | Our plan and targets | [13](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061823) |  |  |  |  |  |  |  |  |
|  |  | Our new divisional structure | [14](#i4be61753b7f243b19551b0bfbf3a2a0d_50577534898522) |  |  |  |  |  |  | [Principal risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_655) | [272](#i4be61753b7f243b19551b0bfbf3a2a0d_655) |  |
|  |  | [2023 divisional review](#i4be61753b7f243b19551b0bfbf3a2a0d_10360) | [15](#i4be61753b7f243b19551b0bfbf3a2a0d_10360) |  | ESG Ratings and Benchmarks | [49](#i4be61753b7f243b19551b0bfbf3a2a0d_220) |  |  |  |  | [Risk performance](#i4be61753b7f243b19551b0bfbf3a2a0d_694) | [284](#i4be61753b7f243b19551b0bfbf3a2a0d_694) |  |
|  |  | About Barclays | [16](#i4be61753b7f243b19551b0bfbf3a2a0d_10384) |  | ESG-related reporting  and disclosures | [50](#i4be61753b7f243b19551b0bfbf3a2a0d_223) |  |  |  | [Supervision and regulation](#i4be61753b7f243b19551b0bfbf3a2a0d_802) | [363](#i4be61753b7f243b19551b0bfbf3a2a0d_802) |  |
|  |  | Barclays UK | [17](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686056221) |  |  |  |  |  |  | [Financial review](#i4be61753b7f243b19551b0bfbf3a2a0d_805) | [373](#i4be61753b7f243b19551b0bfbf3a2a0d_805) |  |
|  |  | Barclays International:  Corporate and Investment Bank | [19](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686056362) |  | [Managing risk](#i4be61753b7f243b19551b0bfbf3a2a0d_11690) | [51](#i4be61753b7f243b19551b0bfbf3a2a0d_11690) |  |  |  |  | Key performance indicators | [374](#i4be61753b7f243b19551b0bfbf3a2a0d_808) |  |
|  |  |  |  | [Viability statement](#i4be61753b7f243b19551b0bfbf3a2a0d_214) | [54](#i4be61753b7f243b19551b0bfbf3a2a0d_214) |  |  |  |  | [Consolidated summary income](#i4be61753b7f243b19551b0bfbf3a2a0d_811)  [statement](#i4be61753b7f243b19551b0bfbf3a2a0d_811) | [376](#i4be61753b7f243b19551b0bfbf3a2a0d_811) |  |
|  |  | Barclays International:  Consumer, Cards and Payments | [21](#i4be61753b7f243b19551b0bfbf3a2a0d_50577534888647) |  | [Shareholder information](#i4be61753b7f243b19551b0bfbf3a2a0d_232) | [56](#i4be61753b7f243b19551b0bfbf3a2a0d_232) |  |  |  |  |  |  |
|  |  |  |  | [Important information](#i4be61753b7f243b19551b0bfbf3a2a0d_238) | [58](#i4be61753b7f243b19551b0bfbf3a2a0d_238) |  | [23](#i4be61753b7f243b19551b0bfbf3a2a0d_10994)  Our stakeholders |  |  | [Income statement commentary](#i4be61753b7f243b19551b0bfbf3a2a0d_814) |  |  |
|  |  |  |  |  |  |  |  |  |  | [Consolidated summary](#i4be61753b7f243b19551b0bfbf3a2a0d_823)  [balance sheet](#i4be61753b7f243b19551b0bfbf3a2a0d_823) | [378](#i4be61753b7f243b19551b0bfbf3a2a0d_823) |  |
|  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  | [Balance sheet commentary](#i4be61753b7f243b19551b0bfbf3a2a0d_826) |  |  |
|  |  |  |  |  | [15](#i4be61753b7f243b19551b0bfbf3a2a0d_10360)  2023 divisional review |  |  |  |  |  | [Analysis of results by business](#i4be61753b7f243b19551b0bfbf3a2a0d_832) | [380](#i4be61753b7f243b19551b0bfbf3a2a0d_832) |  |
|  |  |  |  |  |  |  |  |  |  | [Non-IFRS performance](#i4be61753b7f243b19551b0bfbf3a2a0d_853)  [measures](#i4be61753b7f243b19551b0bfbf3a2a0d_853) | [387](#i4be61753b7f243b19551b0bfbf3a2a0d_853) |  |
|  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  | Financial statements | [394](#i4be61753b7f243b19551b0bfbf3a2a0d_862) |  |
|  |  |  |  |  |  |  |  |  |  |  |  | [Financial statements contents](#i4be61753b7f243b19551b0bfbf3a2a0d_862) | [395](#i4be61753b7f243b19551b0bfbf3a2a0d_865) |  |
|  |  |  |  |  |  |  |  |  |  |  |  | [Consolidated financial](#i4be61753b7f243b19551b0bfbf3a2a0d_877)  [statements](#i4be61753b7f243b19551b0bfbf3a2a0d_877) | [413](#i4be61753b7f243b19551b0bfbf3a2a0d_877) |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  | [Notes to the financial statements](#i4be61753b7f243b19551b0bfbf3a2a0d_910) | [421](#i4be61753b7f243b19551b0bfbf3a2a0d_910) |  |
|  |  |  | [11](#i4be61753b7f243b19551b0bfbf3a2a0d_10551)  Our strategy |  |  |  |  |  |  |  |  |  |  |  |
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| Strategic  report | | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 03 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| In this year’s report | | | | | | | | | | |

![AdobeStock_616673039.png]()

![BARCLAYS_AR2023_CONTENTS.png]()

![Contents.png]()

# Working together

# for a better

# financial future

Our strong and stable franchise has enabled us to remain

resilient and continue to support our customers, clients

and communities through an unpredictable external

environment. We will continue to work together for a

better financial future for all our stakeholders.

“The UK has been Barclays'

home for over 300 years

and as such we play

an active part in its

economic success.”

Nigel Higgins

Chairman

Banks and the banking system should at all times

strive for a high degree of stability and reliability,

reflecting their resilience, continuity of service to

customers and clients, and the essential

mechanics they perform for national and global

economies. The premium for stability and

reliability, and the challenge of achieving both,

rise in difficult times. The essence of our

message to you this year is that Barclays is well

on the journey to a more sustainable, and

satisfactory performance, but has more to do

and a plan to do it.

That the global background is unpredictable is

obvious and volatility is now the backdrop to our

world, where we seek so many things with only

partial success – continuing economic growth,

predictable courses for inflation and interest

rates, settled patterns of global trade, stability

within and between nations.

2023 started with fairly uniform and downbeat

economic and equity market expectations. On

both counts, however, the intervening twelve

months surprised on the positive side, but not

without considerable stress being experienced

by households and businesses, triggered by

inflation and rising interest rates. It is testimony

to the resilience of the economic system that

this occurred but is sobering to note how wrong

so much of the predictive commentary could be.

As a global bank we must pay close heed to shifts

in the external environment and reverberations

for our stakeholders. Banks vary enormously, by

geography and by individual firm, in terms of how

they respond to changes in interest rates and the

interest rate curve. After years of negligible

interest rates, banks have to find the right

balance between higher rates for borrowers,

which improve profitability, and sometimes

conflicting consumer and political expectations;

this is not an easy balance to strike.

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 04 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Chairman’s introduction | | | | | | | | | | |

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| --- | --- | --- |
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|  | Facts and figures |  |
|  | 32.4p1  Earnings per share  2022:30.8p |  |
|  | 8.0p  Dividend  2022: 7.25p |  |
|  | £3.0bn  Total capital return in relation to 2023  2022: £2.1bn |  |
|  | $67.8bn  Sustainable and transition  financing facilitated towards the target  of $1trn by 2030 |  |
|  |  |  |
|  |  |  |

In this environment, Barclays has maintained

strong liquidity and operated towards the top of

its target range for capital throughout 2023. With

a profitable business model we delivered a

Return on Tangible Equity for 2023 of 10.6%1,

enabling capital distributions of c. £3.0bn. These

capital returns mean that since 2019 we have

returned c.£9bn in dividends and buybacks to our

shareholders, representing a share count

reduction of 13%. Our management team has

brought stability to earnings, delivering

consistent underlying returns above 10% since

2021, whilst continuing to oversee significant

improvements in the operations of the bank as

part of our ambition to achieve a standard of

being consistently excellent in all that Barclays

does. This has been a very material endeavour

and Venkat gives more detail about our renewed

operational rigour in his letter.

However, both the Board and management team

are acutely aware that our returns should be

higher, and our valuation is far from where it

should be. Our focus since the global financial

crisis has been to rebuild and stabilise the bank. In

a world of constrained capital and human

resource, the bank has prioritised its operational

and financial resilience, including significant

investments in the technology stack. This has

included a considerable shrinkage of geographic

footprint and a focus on those businesses where

we believe we can be successful.

We have also reinforced the talent and

infrastructure of the Investment Bank, in Markets

and Banking in particular, given that these are

scale-dependent businesses and are central to

the diversified returns strategy we pursue. The

consumer businesses of Barclays have received

less consistent and focused investment.

The challenges of performance and valuation are

linked but distinct. In addressing the challenges

and regulatory requirements of the post-

financial crisis world Barclays has become overly

complex and cost-heavy. It is not always the case

that more resources and extra processes make a

financial institution safer or more resilient.

Complexity can lead to accountability or

responsibility being unclear at times, and to

unnecessary cost; being simpler is often safer,

and more cost efficient. In other words, how we

operate is as important as the shape of the

business model. There are a small number of

business lines which we plan to exit in 2024, but

these are not particularly material to the

performance challenge. The big task is to

execute Venkat's ambition to be consistently

excellent. The simplification of processes and

the streamlining of management layers in the

bank are fundamental to this. This process is well

underway and it lay behind the decision to take a

significant fourth quarter restructuring charge

last year.

The valuation challenge is obviously less directly

under our control. The Board’s view remains that

the diversified returns strategy which we pursue

is the right one. However, it brings business

complexities, and there is a scarcity of

comparable banks in Europe.

Our commitment to the Investment Bank

remains strong, and its priority over the next few

years, having reached overall scale, is to become

more capital efficient and thus profitable, in part

through improved prioritisation around activities

and clients. The cost structure also requires

some work. Given this, we do not envisage

needing to add materially to the capital deployed

in the Investment Bank. At the same time we will

step up investment in the consumer businesses

of Barclays on both sides of the Atlantic.

As a result, we expect the allocation of capital

within the bank to shift, with Markets and Banking

coming to represent a rather lower proportion of

RWAs over coming years. We think that this

balance, as long as it is reinforced by continuing

returns at the appropriate level, should improve

investor sentiment towards this business.

Secondly, we continue the journey to make sure

that investors have more confidence in where

and how we make money. Our disclosures

around risk and profitability have improved

markedly over the last few years and we remain

committed to doing more. The new divisional

reporting arrangement will help here, including

being transparent about those areas of the

business where profitability improvement is most

needed.

In his letter to shareholders Venkat sets out in

more detail his vision for Barclays, including new

financial targets, and a clear plan to achieve

them.

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| Chairman’s introduction (continued) | | | | | | | | | | |

Note:

1 Excluding the impact of Q423 structural cost actions.

This path to a simpler, better and more balanced

bank is not just based on the work around

Barclays’ shape, strategy and financial

performance. It is also intimately tied to our

expression of Purpose, which we have also

decided to streamline to emphasise the way in

which we need to operate. ‘Working together for

a better financial future’ expresses our drive to

deliver high quality products and services which

help to improve livelihoods for customers and

clients, helping them with the finance and advice

to innovate, invest and grow. And for our

communities, it is about using our scale and

capabilities to fulfil potential. It is also clear that a

greater focus on the consumer and on the UK as

a whole are crucial here.

During 2023, we  continued to make progress to

meet our ambition of being a net zero bank by

2050. Capital is critical for a successful energy

transition and we are targeting our financing and

resources to energy companies committed to

decarbonise and investing to enable the

transition in the real economy. I am pleased to

report that in 2023 we financed $67.8bn of

Sustainable and Transition Financing,

contributing towards our target of $1trn by the

end of 2030.

In addition, earlier in February we published a

revised energy policy to progress our climate

strategy, with a commitment not to directly

finance energy companies' new oil and gas

projects, consistent with the IEA NZE scenario,

and setting clear expectations of transition

strategies and decarbonisation requirements for

our clients. This policy change is an important

lever for reducing our financed emissions as we

continue towards aligning our financing portfolio

to the goals of the Paris Agreement.

As you read this report you will also find powerful

testimonies as to how Barclays is supporting our

communities, including in our UK home market.

In 2023 we marked the ten year anniversary of

Barclays’ LifeSkills programme, which has helped

millions of people transform their futures

through its employability tools and learning

resources.

Our partnerships with sport are another

meaningful demonstration of how we can

support the development of vital skills and

confidence which are critical to the future

success of our communities. Building on our

comprehensive sponsorship of girls’ and

women’s football since 2019, in 2023 we debuted

as the Official Banking Partner of Wimbledon,

integrating it with our existing programmes to

support employability and skills, our focus on

sustainability, and connecting clients, customers

and communities.

The UK has been Barclays’ home for over

300 years and as such we play an active part in its

economic success. Against a backdrop of

constrained public finances, high inflation and

interest rates, we recognise the increasing

imperative for financial institutions to play a

prominent role in fostering sustainable economic

growth. We have continued to do just that

through 2023, from our growing network of

Barclays Eagle Labs supporting entrepreneurship,

to our close participation in public policy

consideration of how the UK’s capital markets

can be bolstered to unlock business growth.

The various threads of our performance I have

recounted are only made possible by the

steadfast dedication and hard work of

colleagues. On behalf of the Board I would like to

thank all of them for their ongoing commitment

to serve our stakeholders, and to deliver Barclays’

success.

I am also grateful to all of my Board colleagues for

their contributions this last year. We welcomed

Marc Moses to our Board in January 2023 and Sir

John Kingman to our Board and as Chair of

Barclays Bank UK PLC in June 2023. Both bring a

deep experience of financial services. Julia

Wilson, who joined the Board in 2021, took over

as Chair of the Audit Committee in April 2023

and you can read her letter to shareholders on

page [166](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686054584). I would also like to reiterate my thanks

to Mike Ashley and Crawford Gillies who retired

from the Board during 2023, having supported

Barclays through a period of considerable change

during their tenure.

I look forward to discussing Barclays’

performance in 2023 and plans for the year

ahead at our Annual General Meeting on

Thursday 9 May 2024 in Glasgow, which is the

home of our net zero campus and base for over

5,000 colleagues. The meeting will take place at

the Scottish Events Campus, Armadillo, Glasgow

and shareholders will be invited to participate in

person or online.

2024 will be notable as we renew our focus on

delivering high quality products and service to our

customers and clients, and on improving our

returns to investors.

Nigel Higgins

Chairman

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| Chairman’s introduction (continued) | | | | | | | | | | |

Our ambition to

# be the UK-centred

# leader in global

# finance

Over the last decade we have made good progress

building strong customer franchises in the UK and US,

alongside the leading markets and banking business

outside the US. We have also strengthened the bank

financially, and improved our returns. From these strong

foundations, we have a vision for the shape of a better

run, more strongly performing and higher returning

Barclays.

Introduction

During this year, as in the previous one, we have

seen increasing political and economic tensions

around the world. Resurging nationalism is

precipitating global decoupling, reversing the

ratcheting integration of preceding decades. The

effects are reflected in increasingly restrictive

trade policies, subsidies, mistrust even among

allies, and the resurgence of real conflict.

This riskier market, economic and political

environment has several important implications

for a global financial institution like Barclays.

Notwithstanding global fragmentation, investors

continue to need access to world markets. We

have to provide this while managing the relatively

higher risk of doing so. In the last decade,

Barclays has largely curtailed or entirely shut

retail operations in Africa, India and Europe.

Our footprint today, operating in London and

New York, and across major global financial

centres, positions us well for this increasingly

polarising world.

Perhaps most relevantly, our home in London,

remains one of the leading capital market centres.

Our progress and performance

We have built a strong position in the UK market,

the product of more than three centuries of

commitment, with c.20 million personal customers.

In the last two decades, we have also built a growing

customer franchise in the US, working in

partnership with prominent US brands like Gap Inc.

and American Airlines, through which we serve c.20

million credit card customers. In parallel, we have

established the leading international markets and

banking business headquartered outside the US.

Barclays Investment Bank has forged a global

reputation for sophisticated execution and risk

management, and is at a scale which competes

directly with US peers. In Global Markets we are Top

3 in Credit and Fixed Income Financing1, while in

Investment Banking we continue to maintain a 6th

position globally2. We led on a number of prominent

deals through 2023, including Arm’s IPO – the

largest to price since 2021.

Notes:

1 Coalition Greenwich Competitor Analytics, 1H23 Global Results.

Analysis based on the following banks: Barclays, BofA Securities,

BNP Paribas, Citigroup, Credit Suisse, Deutsche Bank, Goldman

Sachs, J.P. Morgan, Morgan Stanley, UBS. Analysis is based on

Barclays’ internal revenue numbers and business structure.

2 Dealogic for the period covering 1 January 2023 to

31 December 2023.

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| Chief Executive’s review | | | | | | | | | | |

“By being Simpler,

#### Better and More

#### balanced, we can deliver

#### greater shareholder

#### value by 2026.”

C. S. Venkatakrishnan

Group Chief Executive

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|  | Facts and figures |  |
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|  | £25.4bn  Total income  2022: £25.0bn |  |
|  | £6.6bn  Profit before tax  1  2022: £7.0bn |  |
|  | 10.6%  Return on tangible equity1  2022: 11.6% |  |
|  | 13.8%  CET1 capital  2022: 13.9% |  |
|  |  |  |

As we have built our multinational footprint, we

have also strengthened Barclays financially, and

improved our returns. Over the last decade we

increased our capitalisation from 10% to nearly

14% CET1, against a backdrop of accelerating

digital transformation, an evolving regulatory

landscape including Basel III, and significant

economic and geopolitical disruption.

Since 2021, we have delivered consistent

underlying returns above 10%, through an

uncertain operating environment. This strength

and resiliency has enabled us to return c.£9bn in

dividends and buybacks to our shareholders

since 2019, and since 2021 we have distributed

33% of our market cap. With respect to 2023 we

have announced c. £3.0bn in dividends and

buybacks, an increase of 37% on 2022.

We continued to deliver well in 2023, despite the

mixed macroeconomic backdrop. Our income

was £25.4bn, our CIR was 63% - in line with our

target - and our RoTE was 10.6%, excluding the

structural cost charge taken in Q4 2023. We

generated a PBT of £6.6bn, and EPS of 32.4p.

Our Vision

I have considerable ambition for Barclays. Simply

put, I want us to be the UK-centred leader in

global finance. At our core we will have a

comprehensive and pre-eminent UK consumer,

corporate, wealth and private banking franchise,

complemented by a strong, specialist US

consumer bank. Alongside both will be the

leading non-US based Investment Bank.

I want Barclays to be renowned for excellent

operational performance, strong product

delivery, highly satisfied customers and clients,

and robust liquidity, capital and risk management.

The outcome of which is a strongly returning,

highly valued global bank, centred in the UK,

producing higher levels of total shareholder

returns.

Achieving our objective

We are building from the strong foundations I set

out earlier, but we know this is not reflected in our

shareholder experience. We have spent time

examining the path we are on, and the direction

we will take going forward, as we know we need to

do better. I believe Barclays is capable of

delivering further value for our shareholders.

We need to continue to improve our operational

and financial performance, and improve total

shareholder returns. To do so, over the next three

years we aim to make Barclays Simpler, Better

and More balanced.

We will manage the bank along five focused

business lines, each with ambition of scale and

high returns. This will reduce the complexity of

our reporting, and improve the accountability and

transparency of each individual businesses

performance.

Our UK ring-fenced consumer bank – Barclays UK

(BUK) – today delivers consistently high returns,

has entrenched scale, with full presence across

products and clients. We will aim to establish a

leadership position in the UK, ever-improving our

customer propositions and service. Our emphasis

is on regaining share within credit cards and

unsecured lending, and delivering greater

operational and cost efficiency. We aim to reduce

our CIR from 58% in 2023 to c.50% in 2026.

We will split out Consumer, Cards and Payments

(CCP) into three, separately reported businesses:

Barclays US Consumer Bank, Barclays UK

Corporate Bank and Barclays Private Bank &

Wealth Management.

Barclays US Consumer Bank (USCB), is a specialist

partnership credit card provider in the US, with a

market leading position in Travel and Airlines.

Notwithstanding the lower RoTE in 2023 which is

explained on page [21](#i4be61753b7f243b19551b0bfbf3a2a0d_50577534888647) of the Annual Report, we

aim to be a partner of choice for America’s leading

brands, particularly in Retail, achieving an ever-

more diversified portfolio of blue-chip clients.

We will continue to invest in a scalable digital

platform to increase operating efficiency, and

sophisticated capital management techniques to

enhance risk-adjusted returns.

We will also seek to build further on our strengths

in Barclays UK Corporate Bank, which has a long

and successful history of fostering enterprise in

the UK. We have relationships with 25% of UK

corporates2, and see more than two in five of the

UK’s credit and debit card transactions. We aim

to build on this strength, expanding our share in

lending, and modernising our systems to

improve self-service capabilities.

Barclays Private Bank and Wealth Management

represents a significant opportunity to

strengthen our retail and mass affluent franchise,

linked to our strong consumer franchise and

complementing our UK-centred Private Bank.

We will offer robust financial management tools,

priced fairly, managed transparently, constructed

simply and delivered efficiently, in order for our

clients to grow wealth responsibly at each stage

of their personal financial journeys.

Barclays Investment Bank today is the leading

non-US based international markets and

investment banking business3. It is at scale, with

deep client relationships and a global reputation

for sophistication in execution and risk

management.

Note:

1 Excluding the impact of Q423 structural cost actions and the Over-

issuance of Securities in the prior year.

2 Relationships from which we generate >£500 income per annum

from our existing product set from companies (not legal entities) with

annual income of >£6.5m across UK Corporate and Corporate within

the Investment Bank.

3 #6 Global Markets and Investment Banking. Global Markets rank

based on Barclays’ calculations using Peer reported financials. Top 10

Peers includes Barclays and; US Peers: Bank of America, Citi,

Goldman Sachs, JP. Morgan, Morgan Stanley. European Peers: BNP

Paribas, Credit Suisse, Deutsche Bank, UBS. Investment Banking rank

based on Dealogic as at 31 December 2023.

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| Chief Executive’s review (continued) | | | | | | | | | | |

We aim to consolidate our position, broadening

and deepening client relationships, monetising our

investments in technology and capital, and driving

stronger returns. To support this journey, we have

moved the International Corporate Banking

business into Investment Banking.

Operating our bank, and each of our businesses,

extremely well is fundamental to improving and

de-risking our financial outcomes. We will

continue to drive operational and process

efficiency across the group, by streamlining our

workforce, simplifying decision making,

upgrading legacy system architecture, and

accelerating the pace of delivery. This will deliver

improved cost income ratios across every

business, even as we invest to drive better

returns and improve resilience.

I am also clear we must manage the bank in a

consistently excellent way, to avoid unexpected

and unnecessary losses from operational errors

and give continued confidence to our

stakeholders. We have implemented a group-

wide culture programme – Consistently Excellent

– establishing a very high operating standard for

the firm, and targeting best-in-class service

across the group. We are making progress

advancing this high standard across the bank as

numerous examples throughout this Report will

attest, but we have more to do as we aim to

make it the essence of Barclays.

Financially, we will increase the allocation of

capital to higher-returning businesses. Over the

next three years we will deliver a more evenly

balanced allocation of RWAs, with more capital

deployed to our highest returning consumer

businesses, which attract higher investor

multiples.

Note:

1 This multiyear plan is subject to supervisory and Board approval,

anticipated financial performance and our published CET1 range

of 13%-14%.

RWAs in Barclays UK, Barclays UK Corporate

Bank and Barclays Private Bank and Wealth

Management will increase by around 4% points

as a proportion of total RWAs.

By no means is this to diminish the importance of

our Investment Bank; rather, it is to place our

consumer and corporate businesses on a

similarly strong footing.

Over the medium-term this will rebalance

Barclays RWAs across our consumer and

wholesale businesses, to support more

consistent and higher returns.

By being Simpler, Better and More balanced, we

can deliver greater shareholder value by 2026.

Our new financial framework includes a target to

generate a Return on Tangible Equity of greater

than 12% by that time, and to return at least £10

billion to shareholders via a mix of dividends and

buybacks1.

Shaping Barclays for the future

The business, operational and financial goals

which we have outlined are an important part of

success, but they are not all of it. In the

increasingly multi-polar world we described at

the outset, we must choose what we want to be

and where.

This year signifies our strengthened

commitment to the UK. The UK economy

continues to prove relatively resilient to global

shifts and, as a UK headquartered bank, we are

deeply rooted in our domestic market. With a

renewed focus on businesses in which we can be

successful, and a re-emphasis on delivering

excellent customer service, we can build on our

valuable brand and capture even more

opportunity in our home market.

Conclusion

Our commitment to, and deep roots in, the UK

have shaped our vision. As part of this resolve, we

are purposefully engaged in initiatives to advance

UK prosperity, from levelling-up essential life

skills for 3.27 million people during 2023, to

supporting ambitious start-ups and scale-ups

across the UK.

At the heart of the activity and ambition which I

have detailed throughout this letter are our

colleagues. Our success is driven by their hard

work and dedication and to support our

customers, clients and communities. I am

pleased to note that Barclays is ranked as

Number 1 on LinkedIn’s 2023 UK Top Companies

list for the third year in a row, demonstrating that

we have built an organisation of mutual respect

and appreciation, and one in which our

colleagues have opportunities to thrive.

2024 will be a crucial year for Barclays. To change

the way we operate and achieve sustainable

success will take strenuous effort, relentless

focus and time. I am confident that our clear plan

will achieve these objectives, and take us to new

heights.

Thank you.

C. S. Venkatakrishnan

Group Chief Executive

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| Our Priorities | | | |
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|  | Our_Priorities.png | |  |
|  | Simpler  Simpler business  Simpler organisation  Simpler operations | |  |
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|  | Our_Priorities2.png | |  |
|  | Better  Better returns  Better investments  Better quality income  Better customer experience  and outcomes | |  |
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|  | Our_Priorities3.png | |  |
|  | More balanced  More balanced allocation  of RWAs  More balanced  geographical footprint | |  |
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| Chief Executive’s introduction (continued) | | | | | | | | | | |

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| + | Read more about our  priorities on Page 13 |
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| Working together for  a better financial future |  | Our universal banking model enables us to create  synergies across the organisation and deliver long-  term value for our stakeholders. |

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|  | We deploy  our resources... | | |  | ARROW_WHITE_BusinessModel.png |
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|  | We draw on tangible and intangible  assets to drive long-term,  sustainable value creation. | | |  |
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|  | Our_people_BrightBlue.png |  | Our people, Purpose,  Values and Mindset  Our people are our organisation.  We deliver success through  a purpose-driven and  inclusive culture. |  |
|  | Barclar_AR_Strategy_Icons_Toolbox.jpg |  |  |  |
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|  | Our_brand_BrightBlue.png |  | Our brand  Our brand equity instils trust,  lowers the cost of acquiring  customers and clients and helps  retain them for longer. |  |
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|  | Techno_BrightBlue.png |  | Technology and  infrastructure  Our deep technology and  infrastructure capabilities drive  customer experiences and  support strong resiliency. |  |
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|  | Operation_BrightBlue.png |  | Operations and governance  Our risk management, governance  and controls help ensure customer  and client outcomes are delivered  in the right way. |  |

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|  | to serve the financial  needs of our diversified  customer base... |  |  |
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|  | Due to our wide range of  products and services across  markets, we define ourselves  as a ‘universal bank’. |  |
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|  | Moving  We facilitate transactions and move  money around  the world. |  |
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|  | Lending  We lend to customers and clients to  support their needs. |  |
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|  | Connecting  We connect companies seeking funding  with the financial markets. |  |
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|  | Protecting  We ensure the assets of our clients and  customers are safe. |  |
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|  | Investing and advising  We help our customers and clients invest  assets to drive growth. |  |
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|  | delivering value  through synergies... |  |  |
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|  | We bring our organisation  together to create synergies  and deliver greater value. |  |
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|  | Providing customers and clients  with the full range of our  products and services. |  |
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|  | Applying Group-wide  technology–platforms to  deliver better products  and services. |  |
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|  | Joining up different parts  of the Group so capabilities  in one can benefit another. |  |
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|  | Making the Group  more efficient. |  |
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|  |  | providing clear  outcomes for our  stakeholders. |  |  |
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|  |  | Our diversified model provides  the resilience and consistency  needed for the road ahead. |  |  |
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|  |  | Customers and clients  Supporting our customers and clients  to achieve their goals with our products  and services. |  |  |
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|  |  | Colleagues  Helping our colleagues across the  world develop as professionals. |  |  |
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|  |  | Society  Providing support to our communities,  and access to social and environmental  financing to address societal need. |  |  |
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|  |  | Investors  Delivering attractive and sustainable  shareholder returns on a foundation  of a strong balance sheet. |  |  |
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| Our business model | | | | | | | | | | |

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| Our strategy | |  |  |  |
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|  |  |  | Within this section we review  Barclays in the current  environment, provide an overview  of core strengths and capabilities  of the business, and set out our  vision and strategy to drive  improved performance. |  |
|  |  |  | Our business environment |  |
|  |  |  | Our plans and targets |  |
|  |  |  | Our new divisional structure |  |
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| The world in which  we operate |  | Barclays is driven by a common Purpose: working  together for a better financial future. To do so, we  must be strong as an institution, prepared for the future,  and able to navigate different market conditions and  evolving trends. |

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| --- |
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| We regularly review our operating environment  for emerging trends and adapt to address them.  In 2021, we called out three long-term trends  and continue to make good progress addressing  these, as you will find detailed throughout  the report: |
| The impact of technology on consumer  products and services |
| The role of capital markets as the principal  drivers of global growth |
| The transition of the global economy towards  a low-carbon economy |
| Recently, we have adjusted our strategy and  operating model to reflect changes in the  environment we operate in, and evolving  demands from our customers, clients,  regulators and shareholders. |

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| Context:  We actively navigate risk and uncertainty, and are vigilant to deliver for our customers, clients,  and shareholders in any environment. | | | | | | | | | | | | | | | | | |  |

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|  | Primary considerations | | | |  |  |  | Further considerations | | |  |
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|  |  |  |  |  |  |  |  | Climate:  • Energy transition  • More extreme climate cycles  Technology:  • Generative AI, and related impact from regulators  and cybersecurity  • FinTech adoption  Regulatory:  • Basel 3 endgame, and related regulated responses from  countries including effects of AIRB regulations in the US | | |  |
|  |  | Geopolitical  • Elections in over  70 countries during 2024  • Conflict in Ukraine  and Middle East  • US-China relations |  |  |  |  |  |  |
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|  |  | Macroeconomic  • Economic uncertainty:  higher inflation and interest  rates  • Higher systemic risk and  volatility |  |  |  |  |  |  |  |  |  |
|  |  | Macro.jpg |  |  |  |  | CLIMATE.jpg |  | RESILIENCE.jpg |  |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 12 |
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| Our business environment | | | | | | | | | | |

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| Delivering our  three-year plan |  | We have a clear plan to improve our operational and financial  performance, and improve total shareholder returns. To do so,  over the next three years we will make Barclays Simpler, Better  and More balanced. |

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|  | Our Purpose | Working together for a better financial future | | |  |
|  | Our Vision | The UK-centred leader in global finance | | |  |
|  | Our Priorities  We want Barclays to be  renowned for an excellent  operational performance,  highly satisfied customers and  clients, strong liquidity, capital  and risk management, and  predictable, attractive  shareholder returns. Building  on our strong foundations, we  have a clear plan to achieve  these objectives and deliver  further value for shareholders  by 2026. Over the next three  years we will make Barclays  Simpler, Better and More  balanced. | Our_Priorities.png | Our_Priorities2.png | Our_Priorities3.png |  |
|  | Simpler | Better | More balanced |  |
|  | Simpler business  •  Five focused businesses  Simpler organisation  •  Reduce organisational complexity  •  Simplify decision making  Simpler operations  •  Continue to upgrade legacy technology  •  Further uplift operational controls | Better returns  •  Improve performance across all our businesses  Better investments  •  Investments in cost efficiency, and revenue and growth  protection  Better quality income  •  Diverse sources of income to support growth  •  Grow proportion of income from stable revenue streams  Better customer experience and outcomes  •  Improve platform resilience and expanded offerings  •  Deliver best-in-class customer and client experience | More balanced allocation of RWA  •  Capital allocation to our highest returning businesses  •  Barclays Investment Bank c.50% of Group RWA  by 2026  More balanced geographical footprint  •  Focus growth in our home market  •  Leverage our UK brand |  |
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| 2026  targets | Return on  tangible equity  >12% | Total payout 2024-2026  at least £10bn¹ | Investment Bank RWAs  c.50% of Group |  | Supporting  targets | Income  c.£30bn | Cost:income ratio  High 50s% | | Loan Loss Rate (LLR) | |
|  | 50-60bps | through  the cycle |
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| 2024  targets | Return on  tangible equity  >10%  (c.10.5% excluding inorganic activity) | Group net interest income  excluding Barclays Investment Bank and Head Office  c.£10.7bn | |  | Supporting  targets | Barclays UK net interest income  c. £6.1bn2 | Cost:income ratio  c.63% | | Loan Loss Rate (LLR) | |
|  | 50-60bps | through  the cycle |
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| Continue to target a 13-14% CET1 ratio range | | | | | | | | | | |

Note:

1 This multiyear plan is subject to supervisory and Board approval, anticipated financial performance and our published CET1 range of 13%-14%.

2 This excludes the impact of Tesco Bank acquisition, which is expected to generate annualised NII of c.£400m in the first year post completion.

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 13 |
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| Our plan and targets | | | | | | | | | | |

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| + | Read more about our updated strategy at:  [home.barclays/strategy](http://home.barclays/who-we-are/our-strategy/) |
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| Reporting the business  through five divisions |  | From Q1 2024, our reporting will reflect five new clear  divisions.   This will reduce the complexity of our reporting,  and improve the accountability and transparency  of performance. |

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|  | Barclays UK |  | • Long-established scale player with trusted brand  • Strong franchise deposit base (c.20m personal banking  customers and c.1m business banking customers)  • Well-performing lending book (c.5m credit card accounts)  • Long-term RoTE track record |  | Aims  • Establish a leadership position in the UK  • Focus on improving customer service propositions  • Deliver greater operational and cost efficiency |  |  |
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|  | Barclays UK  Corporate Bank |  | • Deep and enduring franchise delivered across the UK through  >50 offices  • Award-winning expertise with an 18-year average client  relationship and a >10% growth in clients vs 2021  • Strong and resilient deposit base |  | Aims  • Expand our share in lending  • Modernise systems  • Deliver more functionality to clients |  |  |
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|  | Barclays Private  Bank & Wealth  Management |  | • One of the largest bank-led Private Bank and Wealth  Management businesses in the UK, now able to support clients  across the full wealth continuum  • International business aligned to our Investment Bank presence,  focused on Ultra High Net Worth and High Net Worth clients |  | Aims  • Strengthen our highly competitive UK wealth offering  • Become the leading UK-centred Private Bank |  |  |
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|  | Barclays  Investment Bank |  | • At scale, focused Global Markets and Investment  Banking franchises  • Leading non-US Investment Bank1  • Diversified, stable income with deep relationships with our  largest clients  • Strong risk and capital discipline |  | Aims  • Consolidate globally competitive Markets and Investment Banking businesses  • Reallocate RWAs towards higher returning businesses and opportunities  • Monetise investments in technology and capital  • Broaden and deepen client relationships |  |  |
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|  | Barclays US  Consumer Bank |  | • 20+ years of expertise in US cards with deep partnership  card experience  • #9 US card issuer 2  | #6 in US partner market2  • 20 client partners | c.20m customers  • Prime book with average FICO >750  • Synergies with Barclays Investment Bank |  | Aims  • Be a partner of choice for America’s leading brands, particularly in Retail  • Increase operating efficiency and enhance risk-adjusted return  • Continue investment in a scalable digital platform |  |  |
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Notes:

1 #6 Global Markets and Investment Banking. Global Markets rank based on Barclays’ calculations using Peer reported financials. Top 10 Peers includes Barclays, Bank of America, Citi, Goldman Sachs, JP. Morgan,

Morgan Stanley, BNP Paribas, Credit Suisse, Deutsche Bank, and UBS. Investment Banking rank based on Dealogic as at 31 December 2023.

2 Based on End Net Receivables. Source: Gate One, as at Q323.

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| Our strategy (continued) | | | | | | | | | | |

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| 2023 RWA allocation |
| Barclays UK   21%  Barclays UK Corporate Bank  6%  Barclays Private Bank & Wealth  Management   2%  Barclays US Consumer Bank   7%  Head Office  6% |
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| Barclays Investment Bank  58% |
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| White arrow only_Down.png |
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| Targeting a more balanced  allocation in 2026 |
| Non-Investment Bank businesses |
| Barclays Investment Bank c.50% |
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![1]()

![13]()

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| 2023 divisional review | | | |  |
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|  |  |  | Our reporting for 2023 divisional  review on the following pages is  based on our reporting divisions in  place during, and as at the end of  2023, and therefore exclude  changes to our operating structure  as detailed in our 2023 Results  Announcement. |  |
|  |  |  | Barclays UK |  |
|  |  |  | Barclays International –  Corporate and Investment Bank |  |
|  |  |  | Barclays International –  Consumer, Cards and Payments |  |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 15 |
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| A strong and stable  universal bank |  | During 2023, Barclays operated as two  operating businesses, Barclays UK and Barclays  International, supported by our service  company, Barclays Execution Services.  The following pages narrate the performance of  these divisions during the year. |  | As part of the 2023 Results Announcement,  Barclays announced a revised operating  structure to deliver value to stakeholders.  The summary view of the new structure can  be seen on page [14](#i4be61753b7f243b19551b0bfbf3a2a0d_50577534898522), and further detail of the  2023 Results Announcement, including revised  divisional financials can be found at:  [home.barclays/investorrelations](https://home.barclays/investor-relations/) |

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|  | Barclays UK | | | | | | | |  | Barclays International | | | | | | | | | | |  |
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|  |  |  |  | £2.9bn  PBT | £73.5bn  RWAs | 19.2%  RoTE | |  |  |  |  |  | £4.6bn  PBT | £259.1bn  RWAs | | | | 8.2%  RoTE |  |  |  |
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|  |  |  |  | Barclays UK consists of our UK Personal Banking, UK  Business Banking and Barclaycard Consumer UK  businesses. These businesses are carried on by our UK ring-  fenced bank (Barclays Bank UK PLC) and certain other  entities within the Barclays Group. | | |  |  |  |  |  |  | Barclays International consists of our Corporate and Investment Bank  and Consumer, Cards and Payments businesses. These businesses operate  within our non ring-fenced bank (Barclays Bank PLC) and its subsidiaries,  and certain other entities within the Group. | | | | | |  |  |  |
|  |  |  |  | UK retail and business banking | | |  |  |  |  |  |  | Corporate and Investment Bank | |  |  | Consumer, Cards and Payments | |  |  |  |
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|  | Barclays Execution Services | | | | | | | | | | | | | | | | | | | |  |
|  |  | Barclays Execution Services (BX) is the Group-wide service company providing technology,  operations and functional services to businesses across the Group. | | | | | | | | | | | | | | | | | |  |  |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 16 |
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| About Barclays | | | | | | | | | | |

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| --- | --- |
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| + | Read more:  page [17](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686056221) |
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| + | Read more:  page  [21](#i4be61753b7f243b19551b0bfbf3a2a0d_50577534888647) |
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| + | Read more:  page  [19](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686056362) |
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![Groupe_Overview_1.png]()

![Groupe_Overview_2.png]()

![Groupe_Overview_3.png]()

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|  |  | Barclays UK | | | | |  |
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|  | Barclays UK consists of our UK personal banking, UK business  banking and Barclaycard Consumer UK businesses. | | | | | |  |
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|  |  | Focus areas  • Offering banking services that meet the  needs of today’s and tomorrow’s  customers and clients, making money work  for them.  • Pursuing digital innovation and helping  colleagues focus on value-adding customer  interactions.  • Making our customers’ communities better  tomorrow than they are today, and seeking  out opportunities for an inclusive and  sustainable future. | |  | Business description  • UK Personal Banking offers retail solutions  to help customers with their day-to-day  banking needs.  • UK Business Banking serves business  clients, from high-growth start-ups to  SMEs, with specialist advice.  • Barclaycard Consumer UK is a leading  credit card provider, offering flexible  borrowing and payment solutions while  delivering a leading customer experience. |  |  |
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Year in review

Barclays UK has been customer-focused and

community-based for 333 years. In 2023 we focused

on strengthening our customer and client

propositions and improving our execution. Our strong

franchise and valuable brand are reflected in our

financial performance, with Barclays UK delivering a

RoTE of 19.2%. Notwithstanding these results, and

our progress over the course of 2023 to refine and

enhance our customer service, we know we have

more to do.

During 2023, cost of living pressures and the rising

interest rate environment continued to impact our

customers in the UK. In response we enhanced the

tools and information available to customers via our

Money Management Hub – helping them better

understand their spending and the steps they can take

to improve their financial wellbeing. We also launched

our Money 1:1 service, offering customers a

personalised financial coaching session with a specially

trained Barclays Money Mentor.

To boost customers’ long-term financial resilience we

provided options to switch to interest-only mortgages

for six months and extensions of their mortgage term

where appropriate. Additionally, we helped over

103,000 new customers get on or move up the

housing ladder during 2023 – including 33,000 first-

time buyers. We also proactively contacted 1.2 million

customers to let them know they could earn more

interest by moving to a different savings product. For

our business clients, we ran more than 900 Business

Health Pledge masterclasses during 2023.

As part of our customer-centricity we remained

focused on improving our customer experience,

combining the best of digital with the human touch.

The transformation of our physical service model

means we are able to provide in-person support in our

communities, while serving our customers more

sustainably. In 2023 we expanded Barclays Local by

more than 159 new sites and now have

351 sites in total – in addition to 306 branches and 16

mobile service points (vans). We are also participating

in innovative new Shared Banking Hubs.

Improving existing propositions and adding

innovative new ones are important ways we

continue to drive growth in Barclays UK. To this end,

in 2023 we completed the acquisition of Kensington

Mortgage Company – an award-winning mortgage

lender1 known for its strong support of specialist

customer groups and the intermediary market.

Our Savings strategy is to help customers develop

smart savings habits while supporting those already

saving to make their money work harder. We offer

personal customers interest rates of up to 5%, with

our flexible products designed to help customers

achieve their goals. For example, customers can

segregate money from current accounts to develop

savings habits, while Barclays Blue customers are

rewarded with a higher rate in the months they have

no withdrawals.

In parallel, we continue to make good progress to

ensure digital banking with Barclays is smooth,

easy and rewarding – including by improving the

navigation and functionality of our app. As a

consequence, active app customers increased

5% year on year in 2023. Across all our channels,

over 80% of our customer transactions are now

digitally enabled – up from 76% in 2022. While we

will continue to help customers recognise and

embrace the ease and convenience of our digital

capabilities, our focus moving forward will shift to

improving the depth and quality of engagement

from customers already actively using them.

To further strengthen our customer propositions we

also launched Visa Cashback Rewards, giving Barclays

Blue customers cash back on their everyday spending.

Our progress to improve the customer

experience in 2023 is reflected in Barclays UK’s

improved Net Promoter Score, which increased

by six points versus 2022. We recognise there is

still more to do to improve our customer

propositions and execution, and we will remain

focused on doing so.

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 17 |
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| Barclays UK | | | | | | | | | | |

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|  | Measuring where we are | |  |
|  | £7.6bn  Income  2022: £7.3bn | £2.9bn  Profit before tax  2022: £2.6bn |  |
|  | £4.4bn  Operating expenses  2022: £4.3bn | 19.2%  Return on tangible equity  2022:18.7% |  |

Our focus on making communities better

tomorrow than they are today is reflected in our

growing network of Barclays Eagle Labs. Our

37 business incubators across the UK – which

include nine new locations added in 2023 – are

part of our ambition to be a bank where

entrepreneurs start, scale and achieve their

growth ambitions. In 2023 Eagle Labs supported

over 4,500 businesses, while Barclays UK more

broadly supported over 47,000 new start-up or

scale-up customers – including Climate Tech

start-ups working on innovative technology to

deliver a more sustainable future. We were also

entrusted by the UK Government with a £12m

Digital Growth Grant to further support the

growth of UK tech start-ups and scale-ups over

the next two years. The Grant will help deliver

20 national programmes and more than

8,000 business interventions, including our

Sustainability Bridge programme, to enable

ambitious entrepreneurs.

Another key way we support customers is through

our focus on sustainability. This year we expanded

and improved sustainability-related propositions for

customers, including a new Green Barclayloan for

Business that offers no arrangement fees for lending

above £25,000 on a range of green assets –

supporting our business customers in their transition

to net zero. We also expanded our existing Asset

Finance proposition via our partner Propel2, offering

business customers fixed rates on a wider range of

green assets, including new fully electric vehicles and

solar photovoltaic panels.  Additionally, we extended

our Greener Home Reward scheme, which offers a

cash reward of up to £2,000 for eligible residential

mortgage customers who install eligible energy-

efficiency-related measures in their homes.3

Note:

1 In 2023 Kensington Mortgage Company won 'Best Specialist Mortgage

Lender' at both the What Mortgage and Your Mortgage Awards. It was also

named 'Best Intermediary Lender' at the Personal Finance Awards and

'Best Online Mortgage Provider' at the Moneyfacts Awards.

2  Further detail can be found at [barclays.co.uk/business-banking/borrow/](https://www.barclays.co.uk/business-banking/borrow/asset-finance/)

[asset-finance/](https://www.barclays.co.uk/business-banking/borrow/asset-finance/)

3 Further detail can be found at [barclays.co.uk/mortgages/greener-home-](https://www.barclays.co.uk/mortgages/greener-home-reward/)

[reward/](https://www.barclays.co.uk/mortgages/greener-home-reward/)

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|  | BarclaysUK_Picture_1.jpg |  |  |  |  |  | Kensington Mortgages  In March 2023 Barclays bolstered its support for the UK  mortgage market by purchasing Kensington Mortgages, the  UK’s leading residential specialist mortgage lender. Kensington  Mortgages brings over 25 years’ experience of providing  innovative and flexible mortgage products, serving fast-  growing customer groups including the newly self-employed,  contract workers, borrowers with multiple sources of income,  and those with a weaker credit history. This acquisition  broadens our existing mortgage product range and further  enhances our product capabilities. |  |
|  |  |  | “We are  creating more  opportunities  for our  customers to  connect with us  outside of the  traditional  branch, putting  us at the heart  of local  communities." |  |  |  |
|  |  |  |  |  |  |  |  |
|  | Shared Banking Hubs  To reflect the shift in demand away from  traditional bank branches – and the need to  improve efficiency for those who still require  in-person services – Barclays has  participated in the creation of innovative new  Shared Banking Hubs.  These are physical spaces, similar to a  traditional bank branch but shared between  customers of any high street bank. The Hubs  consist of a counter service operated by Post  Office colleagues, where customers can  withdraw and deposit cash, make bill  payments and carry out regular banking  transactions, in addition to private spaces for  financial conversations.  Over 100 Hubs have been announced by  Cash Access UK in locations across the UK,  helping Barclays UK provide our services in a  better and more efficient way while serving  our communities. |  |  |  |  |  |  |
|  |  |  | Melanie Tweddle,  Everyday Customer Care |  |  |  |  |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 18 |
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| Barclays UK (continued) | | | | | | | | | | |

![Logo Kesington.png]()

![Bank_UK_2.png]()

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|  |  |  |  |  |  |
|  | Barclays International:  Corporate and Investment Bank | | | |  |
|  |  |  |  |  |  |
|  | The Corporate and Investment Bank helps money managers,  financial institutions, governments, supranational organisations  and corporate clients manage their funding, investing, financing,  and strategic and risk management needs. | | | |  |
|  |  |  |  |  |  |
|  | Focus areas  • Leveraging the Power of One Barclays¹ to  deliver world-class service for clients.  • Capitalising on our top-tier Global Markets  franchise, focusing on areas of excellence  across our diversified business model.  • Capturing opportunities in our global,  scaled Investment Bank franchise.  Note:  1.  The Power of One Barclays is about colleagues uniting  across businesses to put our clients' needs first. By working as  a cohesive unit - collaborating, sharing expertise and  information - we can deliver the best outcomes for our clients. | |  | Business description  • Global Markets offers clients a full range of  liquidity, risk management and financing  solutions, as well as ideas and content  tailored to their investing and risk  management needs - coupled with  execution capabilities - across the  spectrum of financial products.  • Investment Banking provides clients with  strategic advice on mergers and  acquisitions (M&A), corporate finance and  financial risk management solutions, as  well as equity and debt issuance services.  • Corporate Banking provides working  capital, transaction banking (including  trade and payments), and lending for  multinational, large and medium  corporates, and for financial institutions. |  |
|  |  |  |  |  |  |

Year in review

In 2023 we experienced a challenging market and

wallet environment, characterised by inflation,

macroeconomic uncertainty and heightened

geopolitical tensions. These conditions contributed

to subdued primary market activity, as reflected in

the 16% year-on- year decline in the global

investment banking wallet1.

Against this backdrop, the Corporate and

Investment Bank (CIB) delivered a 8.4% RoTE (2022:

10.2%). Our resilient CIB performance reflects the

benefits of our income diversification, the strength

of our client relationships, and close collaboration

across Investment Banking, Corporate Banking and

Global Markets.

In Investment Banking, we continued to deliver for

our clients through rigorous focus, consistent

execution and a strong solutions mindset. We

ranked sixth globally in 20232, and in the UK we

topped the investment banking league table - in

fees earned - for the first time in six years3.

Additionally, we continue to excel in areas of

traditional strength, such as Debt Capital Markets

where we rank fifth globally2, and we are successfully

expanding in priority areas such as Equity Capital

Markets, where our share grew by 70bps.

Among the year's highlights, Barclays was proud

to serve as Joint Global Coordinator and Billing &

Delivery Agent on Arm’s IPO. Please see the

facing case study for further information.

In Global Markets, we continue to be a leading

provider of liquidity to institutional clients around

the world, helping them find opportunities and

manage risk. Our clients recognised Barclays for

our level of service amid continued market volatility

as we were named Interest Rate Derivatives House

of the Year by Risk magazine, as well as Credit

Derivatives and Equity House of the Year by IFR.

Note

1 Dealogic Banking wallet as at December 31st 2023 for the period covering

2022 to 2023.

2 Dealogic for the period covering 1 January 2023 to 31 December 2023.

3 Data from Dealogic, UK Investment Bank revenue by bank, full year 2023.

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|  | CIB_1 (1).png | |  |
|  |  |  |  |
|  | Arm IPO  In 2023 Barclays helped British  semiconductor design company Arm  become a publicly listed company through an  Initial Public Offering (IPO) on the Nasdaq  stock exchange.  Barclays acted as Joint  Global Coordinator and Billing & Delivery  Agent on the IPO. The US $5.2bn offering is  the largest IPO to price in 2023.  This transaction demonstrates the power of  our Investment Banking and Global Markets  businesses working together to deliver  outstanding outcomes for our clients. This  resulted from focused and consistent client  coverage from across the entirety of our  franchise - from ECM to Global Markets - and  with teams from across Asia, the UK, and  the US.  It also reflects the value in building multi-year  relationships with top clients. Barclays has  had a relationship with Softbank for 18 years,  over which we have executed numerous  transactions. | |  |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 19 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Corporate and Investment Bank | | | | | | | | | | |

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| --- | --- | --- | --- |
|  |  |  |  |
|  | Measuring where we are | |  |
|  | £12.6bn  Income  2022: £ 13.4bn | £4.1bn  Profit before tax  2022: £ 4.3bn |  |
|  | £8.5bn  Operating expenses  2022: £8.9bn | 8.4%  Return on tangible equity  2022:10.2% |  |

We continued to grow share of wallet with our

Global Markets top 100 clients. Income from our

top 100 clients is up 5% year on year, despite

lower client activity in markets across the

industry. Additionally, client market share data for

the first half of 2023 indicates our Global Markets

business now ranks fifth globally (up from sixth)

with institutional clients1.

Our focus remains on delivering sustainable

through-the-cycle returns and we have the

breadth of capabilities across Fixed Income and

Equities, combined with a top tier Financing

business, to deliver on this. We continued to

make progress against some of our key strategic

initiatives, which offset compressed financing

spreads and a weaker environment for

intermediation. In parallel, we continued to grow

our financing capabilities to deliver more stable,

higher returning income.

Over the past five years our ranking in Prime

Services has moved up from 7 rank to joint

5 rank, complementing our existing strength in

Fixed Income Financing where we ranked joint

1 for 20232.

Our Research team provides industry-leading

analysis and investment advice for our

institutional clients. For the second year in a row,

Barclays ranked Top 3 for Fixed Income

Research3 in Institutional Investor Research 2023

rankings - and Top 5 in European Equity

Research3 for the first time - underscoring the

value clients and investors place on our

differentiated content.

The CIB continues to play a fundamental role in

Barclays’ commitment to invest in the transition

to a low-carbon economy. This includes delivery

towards the Group target to facilitate $1tn of

Sustainable and Transition Financing by the end

of 2030, providing green, sustainable and

transition products and services that will support

our clients and the global economy to accelerate

the transition to net zero.

In addition, we continue to invest thoughtfully in

our talent to meet client demands and deliver the

best service. In early 2024 we announced the

formation of a new Energy Transition Group to

support our ambition to be a leading adviser and

financier to clients as they transition to a low-

carbon future.

In Corporate Banking, revenues grew off the back

of elevated deposits income which continued to

benefit from a strong net interest margin, and

increased deposit balances from clients. We

continued to make progress expanding our

international capabilities, building out our

Corporate Banking businesses in the US and

Europe, alongside strengthening our digital

capabilities globally to provide our clients with

seamless access to our transaction banking

product set.

Note:

1 Based on Barclays analysis using internal and external sources.

2 Coalition Greenwich Competitor Analytics, 1H23 Global Results.

Analysis based on the following banks: Barclays, BoA, BNP, CITI,

CS, DB, GS, JPM, MS and UBS. Analysis is based on Barclays'

internal revenue numbers and business structure.

3 [institutionalinvestor.com/section/research](https://www.institutionalinvestor.com/section/research)

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|  |  |  | Nextracker image.jpg |  |
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| “Our clients have  bold visions for  the future.  Through a deep  understanding of  their needs, and by  utilising our full  capabilities across  the CIB, we have  helped them  achieve their  goals at pace.” |  |  |  |
|  |  |  |
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|  |  | Nextracker’s IPO and first Follow-on Offering  Nextracker, a leading provider of intelligent, integrated solar  tracker and software solutions for utility-scale and distributed  generation projects, partnered with Barclays’ investment  banking teams to successfully raise $734m through its IPO in  February 2023 and $662m through its first Follow-on Offering  in July 2023. As Joint Lead Book-Running Manager on the IPO  and first Follow-on Offering, Barclays’ Equity Capital Markets  and what is now known as the Energy Transition Group worked  closely with Nextracker’s management, advising on the  structure, marketing and execution of both deals. The deals  highlight the strength of Barclays’ Equity Capital Markets and  Energy Transition Group franchises and further Barclays’  leadership in the renewable energy industry. |  |
| Dan Grabos,  Co-Head, Americas M&A |  |  |  |
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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 20 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Corporate and Investment Bank (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | See here for further information:  [cib.barclays/investment-banking/](https://www.cib.barclays/investment-banking/financing-the-future-of-solar-energy-with-nextrackers-ipo.html)  [financing-the-future-of-solar-energy-with-nextrackers-ipo.html](https://www.cib.barclays/investment-banking/financing-the-future-of-solar-energy-with-nextrackers-ipo.html) |
|  |

![04_NXT_logos_rgb_white-2023.png]()

![04_NXT_logos_rgb_white-2023.png]()

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|  |  |  |  |  |  |  |
|  | Barclays International:  Consumer, Cards and Payments | | | | |  |
|  |  |  |  |  |  |  |
|  | The Consumer, Cards and Payments division of Barclays  International comprises our International Cards and  Consumer Bank, Private Bank and Wealth Management,  Barclaycard Payments and Consumer Bank Europe  businesses. | | | | |  |
|  |  |  |  |  |  |  |
|  | Focus areas  • Developing new financial products and  capabilities to reflect growing trends, to  drive growth in our strategic home and  international markets.  • Creating an enhanced digital customer  experience to build a more efficient  business.  • Broadening relationships with existing  partners, pursuing new partnerships, and  building capabilities to offer new financing  solutions across all markets. | |  | Business description  • Our US Consumer Bank offers co-branded  and private-label credit cards, online retail  deposits products, personal loans and  instalment payments.  • Private Bank and Wealth Management  provides UK and International clients with  access to the full spectrum of wealth and  private banking services.  • Barclaycard Payments provides a unified  experience for making and receiving  payments in-store and online.  • Consumer Bank Europe offers own-  branded and co-branded credit cards,  online loans, electronic Point of Sale (ePOS)  financing and deposits. |  |  |
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f

Year in review

Consumer, Cards and Payments (CC&P)

delivered a RoTE of 6.7% (2022: 10.0%). Our

performance was driven by the impact of higher

impairment charges, partially offset by

deepening client relationships and market share

in growth businesses, alongside continued digital

innovation to enhance propositions and services.

The strength of our client relationships is

reflected in the performance of our US

Consumer Bank (USCB), where income is up 24%

year on year – driven by our leading position as

the card of choice in the travel & airlines sector1.

Building on the success of our partnership with

Gap Inc., we announced a new partnership with

Breeze Airways to issue its first consumer credit

card programme. In addition, USCB launched a

new partnership with Microsoft and Mastercard

to issue Xbox’s first co-branded credit card in the

US. USCB’s retail deposits have grown 14% year

on year, reflecting excellent competitive

positioning, brand strength, and the broadening

of our partner base.

Continued investment in and focus on,

enhancing digital propositions played an

important role across our specialist businesses.

In USCB, mobile app enhancements – including

enabling facial biometrics ID as part of app

authentication – helped boost the Android app

star rating to 4.7 out of 5 in 2023, up from 4 in

2022.

As further testament of improvements to our

digital platform, our USCB Digital tNPS – a newly

tracked metric for USCB measuring customer

experience at the digital journey level – increased

from 59.8 in 2022 to a full year average of 61.3 in

2023.

In parallel, we have remained focused on

enhancing our product capabilities. In the first

half of 2023 we launched the new JetBlue

programme, a complete redesign to align with

the airlines' new loyalty programme.

Subsequently, we were recognised by J.D.

Power1 for the JetBlue Plus Card, issued by

Barclays, which ranked the highest among co-

branded airline credit cards - demonstrating the

value it offers customers.

The successful integration of Private Bank and

Wealth Management in 2023 is helping build our

advantage in reach and specialist capability.

Combined income for 2023 is £1.2bn, alongside

Client Assets and Liabilities of £74.1bn and

invested assets of £108.8bn. Alongside the

integration there has been an ongoing focus on

enhancing the client experience, reflected in the

launch of the Wealth Hub to 1.2 million Premier

customers in Barclays UK, and providing UK

Private Bank clients with an enhanced service

experience.

Similarly, in Barclaycard Payments we saw a 29%

year-on-year increase in digital logins and a

corresponding 10% reduction in customers

using our call centres, supporting our increased

efficiency. This momentum reflects the

introduction of new digital features – including

the launch of Smartpay Anywhere and Smartpay

Fuse, enabling small business customers to take

online payments as part of a seamless

experience.

Note:

1 [ir.jetblue.com/news/news-details/2023/JetBlue-Plus-Card-](https://ir.jetblue.com/news/news-details/2023/JetBlue-Plus-Card-Issued-by-Barclays-Earns-J.D.-Power-Award-For-Ranking-Number-One-Among-Airline-Co-Branded-Credit-Cards/default.aspx)

[Issued-by-Barclays-Earns-J.D.-Power-Award-For-Ranking-](https://ir.jetblue.com/news/news-details/2023/JetBlue-Plus-Card-Issued-by-Barclays-Earns-J.D.-Power-Award-For-Ranking-Number-One-Among-Airline-Co-Branded-Credit-Cards/default.aspx)

[Number-One-Among-Airline-Co-Branded-Credit-Cards/](https://ir.jetblue.com/news/news-details/2023/JetBlue-Plus-Card-Issued-by-Barclays-Earns-J.D.-Power-Award-For-Ranking-Number-One-Among-Airline-Co-Branded-Credit-Cards/default.aspx)

[default.aspx](https://ir.jetblue.com/news/news-details/2023/JetBlue-Plus-Card-Issued-by-Barclays-Earns-J.D.-Power-Award-For-Ranking-Number-One-Among-Airline-Co-Branded-Credit-Cards/default.aspx)

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|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 21 |
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| Consumer, Cards and Payments | | | | | | | | | | |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | Measuring where we are | |  |
|  | £5.3bn  Income  2022: £4.5bn | £0.5bn  Profit before tax  2022: £0.7bn |  |
|  | £3.3bn  Operating expenses  2022: £3.1bn | 6.7%  Return on tangible equity  2022: 10.0% |  |

We continued to build our client portfolio, signing

new business deals in 2023 with prominent

brands including department store Fenwick and

plumbing and heating specialist Wolseley.

Barclaycard Payments and Barclays Corporate

Banking were chosen by Fenwick to provide a

range of banking and payment services to

support the growth and digitisation of the

business – testament to the breadth of our

business services, collaboration, and digital

capabilities.

Consumer Bank Europe delivered a strong

performance, growing its deposit book 206%

year on year, driven by our continued focus on

enhancing the customer experience. We

launched the in-app call facility to significantly

improve the efficiency and speed of customer

service. We also continued to be a leading

provider of consumer finance through our credit

cards and personal loans business.

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|  | Xbox | | | | | |  |  |  |
|  | Barclays US Consumer Bank further diversified its  credit card portfolio with the launch of the Xbox  Mastercard, Microsoft’s first co-branded card in the US.  Using research and insights, the credit card product was  custom-built to provide the Xbox community with an  immersive digital experience across the entire  customer journey – from applying through  the Xbox  console and web, to earning and redeeming their card  rewards, and personalising their card with their  gamertag on one of five iconic Xbox-inspired designs. | |  | Created with customer- and client-centricity in mind,  the card aims to heighten enjoyment for Xbox players  while deepening their loyalty and enhancing  engagement with one of the world’s most recognised  brands. It is currently available for Xbox Insiders in 50 US  states through Microsoft digital channels including  xbox.com. | | |  |  |  |
|  |  |  |  | ”We have  continued our  focus on  customers'  and clients’  experience,  listening to  their feedback  to prioritise  enhancements  in our digital  servicing  channels.” |
|  | xbox_mastercard.jpg | | | | | |  |  |
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|  | BARCLAYS_AR2023_DIVISIONAL_NEW_PIC.jpg | | | |  | Private Bank and Wealth integration  On 1 May 2023 Barclays completed the  transfer of its UK Wealth Management &  Investments business to sit alongside the  Private Bank. The transition of 300,000 clients  and 1,000 colleagues has created one of the  largest bank-owned Private Bank and Wealth  Management businesses in the UK.  The combined business, Barclays Private Bank  and Wealth Management, provides UK clients  with access to the full spectrum of wealth and  private banking services while opening up  access to the broader key markets and wealth  corridors where Barclays provides Private  Banking in Europe, the Middle East, Asia and  Africa.  The integration will enable us to grow our client  relationships in the UK and further develop our  reputation as a trusted choice for Private Bank  clients in selected international markets. |  |  |
|  |  |  |  | Mike Robinson,  Head of Customer, USCB |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 22 |
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| Consumer, Cards and Payments (continued) | | | | | | | | | | |

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|  |  |  |  |  |
| Our stakeholders | |  |  |  |
|  |  |  |  |  |
|  |  |  |  |  |
|  |  |  | In this section we cover how  we listen and respond to our  stakeholders, and create  sustainable value for all  those we serve. |  |
|  |  |  | Customers and clients |  |
|  |  |  | Colleagues |  |
|  |  |  | Society |  |
|  |  |  | Investors |  |
|  |  |  |  |  |
|  |  |  | The KPIs featured throughout this section  are used to monitor our performance and  progress – they are also linked directly to  Executive Director remuneration. Further  detail can be found in the Remuneration  report on page [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) |  |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 23 |
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|  |  | Customers and clients | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  | We aim to build trust and loyalty by offering innovative  products and services with an excellent customer and  client experience. We seek to understand our customers’  and clients’ expectations and aspirations, and develop  products and services to support them – especially  during difficult economic conditions. | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  |  | Where to find out more: | | |  |  |
|  |  |  | + | Please visit our ESG resources hub for further  information: home.barclays/sustainability/esg-resource-  hub/reporting and disclosures/ |  |  |  |
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Engaging with customers

and clients

Barclays is committed to serving our customers'

and clients' best interests. To do so we regularly

engage them, building our understanding of their

evolving needs and enabling us to adapt our

products and services accordingly. We engage in

a wide variety of ways, including running regular

surveys, analysing customer complaints, direct

interaction and drawing on data from millions of

individual transactions.

Our engagement is most significant with respect

to our large retail presence in the UK, where we

offer a wide range of products and services to

approximately 20 million customers through

Barclays UK.

Barclays UK runs on average eight panels per

month for Personal, Premier and Business

customers and clients to share their views on our

products and services, and on their own financial

health. These panels provide regular insights to

bring us closer to our customers, and to inform

our design principles and the transformation of

our customer journeys.

As described in the Barclays UK section of this

report on page [17](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686056221), inflation has been a dominant

theme for customers during 2023 and we have

adapted and enhanced our products and services

to better serve them in response. One example is

our Barclays Money Worries Hub1, which was

launched to bring together the resources and

advice our customers told us they needed in

challenging economic times. This is in addition to

our specific mortgages and personal savings

initiatives also detailed on page [244](#i584fad17af1f4768930f46f2e8d68f20_120288).

More broadly, Barclays UK collected over

1.4 million pieces of customer feedback in 2023.

Customers told us they wanted their experiences

with Barclays to feel more personal, as well as

showing continued demand for increased

convenience and functionality of the Barclays app.

In response we have introduced new design

principles to ensure every new or updated

customer experience feels personalised, and

have continued to develop the capabilities of our

app. Our work to ensure a seamless digital

experience for customers is one of the reasons

we have more active digital users than any other

UK bank2.

While we continue to make progress addressing

the volume of Barclays UK customer complaints,

we recognise there is still more work to do to

improve the overall customer experience and

address and remove the root causes of customer

complaints. This focus is at the core of our new

vision and strategy as we work towards improving

our propositions and execution in our consumer

businesses, in order to deliver best-in-class

service and ensure we have highly-satisfied retail

customers.

Customer and client feedback in Barclays US

Consumer Bank has recently highlighted positive

experiences with our specialists and customer

agents, while areas for suggested improvement

include making it even easier for customers and

clients to interact with us. We are using this

feedback to help prioritise improvements, for

example simplifying the digital customer journey

and reducing the need to contact our call centres

as detailed on page [242](#i4be61753b7f243b19551b0bfbf3a2a0d_124).

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 24 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Customers and clients | | | | | | | | | | |

![Customers&clients_FO_1.png]()

In the Corporate and Investment Bank, reflecting

on engagement with and feedback from our

clients, we continued to build the expertise,

knowledge and capabilities they are looking for.

We strengthened partnerships across business

lines to deliver a more integrated set of solutions

and services to global clients, and growing client

mindshare.

Supporting customers and clients

Our aim at Barclays is to offer an accessible,

empathetic and inclusive service for our

customers, including for those who may typically

face barriers to accessing banking services –

such as people living with disabilities, complex

needs or experiencing difficult life events.

During the course of 2023 we delivered a number

of key measures to support the financial

resilience of our customers against a challenging

economic backdrop, including reaching out via

SMS to 1.4 million customers to offer a free

conversation about cost of living-related

financial worries. In addition, we seek to support

vulnerable customers and provide responsible

and inclusive banking in an extensive range of

ways.

Note:

1 [barclays.co.uk/money-management/](https://www.barclays.co.uk/money-management/)

2 The #1 for digital users score is from Curinos - eBenchmarkers

Analyser and internal analysis. and is from their April 2023 report .

\* In Barclays UK, the Performance Framework through its design

and approach encapsulates the Consumer Duty and looks to

mitigate the risk of inappropriate practices. It provides guidance

on Performance Management to promote the right culture to

deliver good customer outcomes, supports colleague

development and drives sustainable commercial performance.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | CC_1.jpg |  |
|  |  |  |
|  | Fraud and scams  A key way we support the financial resilience  of vulnerable customers is through our focus  on fraud and scams. While overall rates of  fraud and scams continue to rise across the  sector, Barclays has one of the lowest scam  rates and highest reimbursement rates in the  industry, due to our investment in robust  security systems and commitment to  educating customers¹.  Our fraud detection systems can determine  in less than a second if a payment is likely to  be a fraudster rather than a customer, and  we continue to invest in security features  that protect against fraud and scams –  including ‘App ID’, which allows customers to  verify they are speaking to a Barclays  colleague. We are also part of the ‘Do not  originate’ scheme, a partnership with the  telecommunications industry, UK Finance  and Ofcom to prevent customer phone  numbers from being spoofed.  Fraud can only be stopped through cross-  sector collaboration. Barclays is a founding  member of Stop Scams UK, a group made up  of banks, telecoms and tech firms. |  |
|  |  |  |
|  | Note:  1 PSR report, October 2023, [.psr.org.uk/information-for-](https://www.psr.org.uk/information-for-consumers/app-fraud-performance-data/)  [consumers/app-fraud-performance-data/](https://www.psr.org.uk/information-for-consumers/app-fraud-performance-data/) |  |
|  |  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Consumer Duty  The new Consumer Duty marks the beginning of a step-change in UK consumer regulation,  requiring firms to act to deliver good outcomes for retail customers – a principle underpinning  Barclays’ ambition of being a consistently excellent organisation delivering best-in-class service  for customers and clients.  We have undertaken significant work to implement the Duty across the Group, and continue to  embed this throughout the organisation. We continue to use and enhance data and insights to  ensure our strategy, products and services for retail customers deliver the intended outcomes,  with a focus on meeting the needs of people with vulnerable characteristics.  For example, drawing on data and insights from our Rainy Day Saver product, we contacted over  1.2 million customers to advise them that alternative products may offer a better interest rate for  balances over £5,000. |  |
|  | Customers&Clients_CaseStudy_2.png |  |
|  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 25 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Customers and clients (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | You can found out more about Barclays’ policy views  here: home.barclays/news/press-releases/2023/08/eight-  in-ten-brits-feel-unsafe-on-social-media-due-to-  scammers/ |
|  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Barclays UK  Net Promoter Score  (NPS) |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![41231686041638]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  Net Promoter Score (NPS) is used to  measure the strength of customer  relationships. We track NPS to identify both  our strengths and where there is room for  improvement, informing how we develop our  services and products in the future. | |  |
|  |  |  |  |
|  | How we performed  NPS for Barclays UK has improved through  2023 to +17. Personal Customers with Blue  or Premier accounts feel more positive about  their experience, although a decline in  Business Banking NPS means rebuilding and  deepening relationships with clients is high on  our forward agenda. Barclaycard NPS has  also increased through 2023. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Barclays UK  complaints excluding PPI  (% movement year on year) |  |

![42331197669473]()

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  The FCA publishes complaints information  every six months – a good measure of how  well UK institutions are driving customer  outcomes. We measure our volume of  complaints, tracking against goals and  reviewing root causes to inform changes to  our products and services. | |  |
|  |  |  |  |
|  | How we performed  We are striving for highly satisfied customers  and recognise that better service is a key  lever. However, complaint volumes increased  during 2023, driven by specific issues  encountered by customers and rising levels  of fraud and scams experienced across  industry. A rigorous plan is in place to address  these issues and to reduce the reasons for  customers to complain, including a focus on  improving our propositions and execution to  deliver best-in-class service. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Consumer, cards and payments  US customer digital engagement\*  (%) |  |

![41231686041755]()

![41231686041756]()

![41231686041757]()

|  |  |  |
| --- | --- | --- |
|  |  |  |
| 2023 | 2022 | 2021 |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  Digital engagement assesses our digital value  proposition and user experience. We  measure usage over a 90-day period as a  percentage of total active customers,  reflecting the general health of the digital  experience and allowing us to uncover any  issues we may need to address. | |  |
|  |  |  |  |
|  | How we performed  Overall, our customer digital engagement  improved year-on-year by 190bps, excluding  Gap Inc. customers who display lower digital  activity. The improvement reflects the  introduction of new and enhanced digital  engagement features and technology  advancements. | |  |
|  |  | Note:  \* Excluding Gap Inc. customers. | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Corporate and Investment Bank  revenue ranks and market shares  (%, #) |  |

|  |
| --- |
|  |
| 2023 |

![41231686041806]()

|  |
| --- |
|  |
| #6 |
| #6 |

|  |
| --- |
|  |
| 2022 |

![41231686041810]()

|  |
| --- |
|  |
| #6 |
| #6 |

|  |
| --- |
|  |
| 2021 |

![41231686041814]()

|  |
| --- |
|  |
| #6 |
| #6 |

|  |  |
| --- | --- |
|  |  |
| n | Global Markets revenue ranking and share |
| n | Dealogic Investment Banking global fee ranking and share  demonstrating our performance vs peers. |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  Revenue ranks and market shares are a good  indicator to monitor success and identify  opportunities. By using Dealogic Investment  Banking global fee ranking and share, and a  comparison to global peers' share of  reported revenues for Global Markets, we  can assess our relative performance versus a  defined peer group1 clearly and transparently. | |  |
|  |  |  |  |
|  | How we performed  In 2023 we maintained our rank of sixth  across the Investment Bank in both Global  Markets and Investment Banking, despite  challenging market conditions and  suppressed dealmaking. | |  |
|  | Note:  1 Global Markets rank based on Barclays' calculations using  Peer reported financials. Top 10 peer group includes  Barclays and US peers: BoA, BNP, CITI, CS, DB, GS, JPM,  MS and UBS. Where any of the peer group has not  published results by the time we report, we use the  consensus estimate for their quarterly performance. | |  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 26 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Customers and clients (continued) | | | | | | | | | | |
| Customers and clients – our KPIs | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | See page  [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) for details on Executive Director  remuneration linked to these KPIs |
|  |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  |  | Colleagues | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  | Our colleagues are connected by a shared Purpose, Values  and Mindset, and commitment to delivering to a consistently  excellent standard. We strive to make Barclays a great place  to work, empower colleagues to attain sustainable high  performance and deliver strong results for stakeholders | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  |  | Where to find out more: | | |  |  |
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|  |  |  |  |  |  |  |  |

Engaging with  colleagues

Barclays has a diverse talent pool of around

90,000 colleagues across the world. We engage

in regular dialogue with our colleagues to

understand what is working well and where there

are opportunities to improve. This includes

townhalls, skip-level meetings, site visits, leader-

led engagement and surveys. We maintain an

engagement approach in line with the UK's

Financial Reporting Council (FRC) governance

recommendations.

Our regular all-colleague Your View surveys give

individuals the opportunity to share their views

on how they find working at Barclays. This year’s

survey generally shows improvement to our

scores: Engagement increased +2ppt to 86%,

alongside our highest scores to date for

Wellbeing (88%) and Inclusion (83%). In addition,

our broader Continuous Listening Strategy

includes pulse surveys deployed throughout the

employee lifecycle, capturing insights that help

us improve the colleague experience.

Maintaining a strong and effective partnership

with Unite1, national works councils and the

Barclays Group European Forum helps us gather

feedback. We continue to consult with colleague

representatives on major change programmes

impacting our people, to minimise compulsory

job losses and focus on reskilling and

redeployment.

Achieving a consistently excellent

standard

As our CEO discusses in his letter, Barclays

continues to focus on delivering to a higher

operating standard via our Group-wide cultural

change programme, Consistently Excellent. This

programme challenges colleagues to address

five key areas – Precision, Service, Focus,

Efficiency and Diversity of thought – to establish

a new operating standard.

This higher standard is becoming part of our

culture and we are working hard to equip

everyone with the right skills to achieve this, while

rewarding progress. We have incorporated it into

our existing Values and Mindset behaviours and

as part of an enhanced set of leadership

behaviours. We also began updating our key

processes for attracting, retaining and

developing talent, planning for succession, and

recognising and rewarding performance.

To help create a common understanding across

the Group, we led Consistently Excellent

workshops throughout 2023 for our senior

leaders. In 2024, all colleagues will be invited to

attend these workshops.

Progress in embedding this new operating

standard with colleagues is reflected in the

results from our Autumn 2023 Your View survey.

89% of colleagues felt their peers “have a good

understanding of what it means to be a

consistently excellent organisation”. Further,

62% (+2ppt) of colleagues said it was “simple and

straightforward to get things done at Barclays”, a

concept in line with one of our key Consistently

Excellent focus areas, although this result shows

there is still more to be done in making Barclays

more efficient.

Investing in our talent

Our talent ambition underpins Barclays’

approach to talent attraction, retention and

development. We relaunched our ambition in

2023 to focus on the skills and capabilities we

require for the future, and set the benchmark for

what it means to lead at Barclays through our

refreshed leadership framework. Together, these

set clear behavioural expectations for our

leaders, and enable our leaders to create the

right culture for colleagues to deliver to a

consistently excellent standard.

Using this framework we aim to empower

Barclays leaders to create an environment of

psychological safety and inclusion, and to foster

a culture of learning and curiosity where

colleagues can thrive – supporting all colleagues

across Barclays to grow and progress their

careers.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 27 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Colleagues | | | | | | | | | | |

![Colleaugues_FO_1.png]()

|  |  |
| --- | --- |
|  |  |
| + | For more information on our commitment to building a diverse,  equitable and inclusive workplace, see:   [home.barclays/who-we-](http://home.barclays/who-we-are/our-strategy/diversity-and-inclusion/)  [are/our-strategy/diversity-and-inclusion/](http://home.barclays/who-we-are/our-strategy/diversity-and-inclusion/)  For additional colleague KPIs please visit our ESG resource hub:  [home.barclays/sustainability/esg-resource-hub/reporting and](http://home.barclays/sustainability/esg-resource-hub/reporting and disclosures/)  [disclosures/](http://home.barclays/sustainability/esg-resource-hub/reporting and disclosures/) |
|  |

To empower our colleagues to attain sustainable

high performance, we continued to deliver our

flagship leadership development programmes:

the Enterprise Leaders’ Summit, our Strategic

Leaders Programme, and our award-winning

Aspire programme.

With our Diversity, Equity and Inclusion (DEI)

agenda in mind, we continue to attract

candidates who possess the capabilities, critical

skills and experience required to provide

exceptional service to our customers and clients.

In 2023, our graduate intake was over 36%

female, while our undergraduate Discovery

Diversity Programme focused on showcasing

successful career paths for underrepresented

minorities. These hiring programmes have

helped drive applications from a diverse pool of

candidates. To further promote social mobility,

we will continue our extensive apprentice hiring

programme through engagement with

educational institutions.

Delivering on our Diversity, Equity

and Inclusion plans and ambitions

At the end of 2023, 5.1% of UK and 21% of US

colleagues were from underrepresented

ethnicities, surpassing our ambitions two years

early. We are now resetting this ambition to

achieve a further 12.5% and 5% respective

increase in the UK and the US by the end of 2025.

To hold ourselves accountable at a senior level

we have set a new ambition to increase the

number of Managing Directors from

underrepresented ethnicities by 50% – to 84 in

the UK and US combined by the end of 2025. At

the end of 2023 this was 55.

We are also progressing towards our ambition of

33% representation of women in senior

leadership roles (Managing Directors and

Directors) by the end of 2025. At the end of 2023

this was 30%Δ.

Maintaining our focus on wellbeing

In our Autumn 2023 Your View survey the

Wellbeing Index score rose to 88% favourable

(+2ppt year on year), demonstrating our

maintained focus on wellbeing.

We remain committed to supporting colleague

wellbeing using data-driven insights and

engagement through leader-led initiatives such

as the 'Healthy to Talk' campaign on World

Mental Health Day. This is supplemented by

dedicated people leader workshops exploring

practical ways to continue to embed wellbeing

into ways of working.

There are now over 47,500 colleagues registered

on our Be Well wellbeing portal – the highest

number since its launch – while our mental health

awareness eLearning has been completed by

84% of colleagues and 90% of people leaders.

Introducing structured hybrid working

Following our continuous test and learn

approach, Barclays has adapted its ways of

working to introduce structured hybrid working –

supporting colleagues to connect in-person and

plan their work to make the most of both their

time in the office and remotely.

Building connections is a vital part of our culture.

In our Autumn 2023 Your View survey, 76% of

colleagues told us that their team’s hybrid

approach enables them to deliver the best

outcomes for our colleagues, clients and

customers. We continue to monitor colleague

perceptions and may evolve our hybrid working

approach further as we gather insights and

learnings.

Our people policies

Our people policies2 help us recruit the best

people, provide equal opportunities and create

an inclusive culture in line with our Purpose,

Values and Mindset, and in support of our long-

term success. They are regularly reviewed and

updated to ensure alignment with our broader

people strategy.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  |  |  |
|  |  |  |
|  | A great place to work  We were delighted to receive a number of awards in 2023 in recognition of our efforts, including:  • Times Graduate Employer of Choice Award – Finance category  • LinkedIn Top UK Employer – for the third consecutive year  • Times Top 100 Graduate Employers – Top 10 |  |
|  |  |  |

We are committed to paying our colleagues fairly

and appropriately relative to their role, skills,

experience and performance. This means our

remuneration policies reward performance in line

with our Purpose, Values and Mindset, and our

consistently excellent standard. We also

encourage our colleagues to benefit from

Barclays’ performance by enrolling in our

employee share ownership plans.

Companies Act Diversity Disclosure

On a Companies Act 2006 414C basis3 as at

31 December 2023, Barclays employs 98,662

colleagues across the world (54,032 male, 44,219

female, and 411 undisclosed), including 423 senior

managers (318 male, 105 female), and 13 Board of

Directors at Barclays PLC (8 male, 5 female).

|  |  |
| --- | --- |
|  |  |
| + | Read more about our commitment to fair pay in the  Remuneration report, from page [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520), and in our Fair Pay Report. |
|  |

|  |
| --- |
|  |
|  |

Notes:

1 The collective bargaining coverage of Unite in the UK represents

80% (2022: 82%) of our UK workforce and 40% (2022: 43%) of

our global workforce.

2 Our policies reflect relevant employment law, including the

provisions of the Universal Declaration of Human Rights and the

International Labour Organization (ILO) Declaration on

Fundamental Principles and Rights at Work.

3 Headcount basis, including colleagues on long-term leave.

Undisclosed refers to colleagues who do not record their gender in

our systems. 'Senior managers' is defined by the Companies Act and

is different to both our Senior Managers under the FCA and PRA

Senior Managers regime, and a narrower scope than our Director

and Managing Director corporate grades. It includes Barclays PLC

Group Executive Committee members, their direct reports and

directors on the boards of undertakings of the Group, but excludes

Directors on the Board of Barclays PLC. Where such persons hold

multiple directorships across the Group they are only counted once.

Δ2023 data re-produced from the Barclays PLC Annual Report

where selected ESG metrics marked with the symbol △ were

subject to KPMG Independent Limited Assurance under ISAE

(UK) 3000 and ISAE 3410. Refer to the ESG Resource Hub for

further details.

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|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 28 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Colleagues (continued) | | | | | | | | | | |

![COLLEAGUES_FO_1.png]()

![COLLEAGUES-LOGOS.png]()

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Colleague  engagement  (%) |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![42331197669425]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  Colleague engagement is derived from the  responses to three questions in our all-  colleague Your View survey that measure  colleague advocacy, motivation and sense of  personal accomplishment. It enables us to  monitor how engaged our workforce is and  closely relates to key organisational and  colleague outcomes such as productivity,  wellbeing and retention. | |  |
|  |  |  |  |
|  | How we performed  Colleague engagement improved +2ppt to  86% and we saw improvements across all  three of the questions that make up the  engagement score. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Females at Managing  Director and Director level  (%) |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![42331197669435]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  This metric is used to monitor our progress  against our gender ambition of 33% females  at Managing Director and Director level by  the end of 2025. | |  |
|  |  |  |  |
|  | How we performed  We saw a marginal improvement since 2022.  While we are making gradual long-term  progress to achieve our ambition of 33% by  the end of 2025, we still have more to do. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | “I would recommend Barclays  to people I know as a great place  to work” (%) |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![42331197669450]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  This is one of the three questions making up  our colleague engagement score, specifically  measuring advocacy of Barclays as an  employer. In addition to being used as part of  our engagement score, this question can  also be used as an 'Employee Net Promoter  Score' and is regularly tracked in our monthly  pulse survey. | |  |
|  |  |  |  |
|  | How we performed  Colleague advocacy improved slightly year on  year and is +13ppt above our pre-pandemic  score of 73% in 2019 – and +5ppt above our  external benchmark. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | “I believe that my team and I do a  good job of role modelling the  Values every day” (%) |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![42331197669468]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  This question within our Your View survey  measures colleagues’ perception of how well  the Barclays Values are role-modelled by  colleagues. The Values are our moral  compass; the fundamentals of who we are  and what we believe is right. | |  |
|  |  |  |  |
|  | How we performed  In 2023 we saw a +2ppt improvement year on  year, which brings us in line with the previous  high of 94% in 2020. | |  |
|  |  | |  |

Note

Δ  2023 data subject to independent Limited Assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub: home.barclays/sustainability/esg-resource-hub/reporting and disclosures/

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 29 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Colleagues (continued) | | | | | | | | | | |
| Colleagues – our KPIs | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | See page [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) for details on Executive Director  remuneration linked to these KPIs |
|  |

|  |  |
| --- | --- |
|  |  |
| 33% by end 2025 |  |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  |  | Society | | | | | |
|  |  |  |  |  |  |  |  |
|  |  | Our success is judged not only by our commercial  performance but also by our contribution to society and  the way we work together for a better financial future for  all our stakeholders. Our focus on society falls broadly into  three categories: Climate, Communities and Suppliers. | | | | |  |
|  |  |  | Where to find out more: | | |  |  |
|  |  |  | + | About the people and businesses Barclays supports through its community programmes:  [home.barclays/community](Barclays/sustainability/supporting-our-communities/)  About the Bank’s skills and employability programmes at [home.barclays/lifeskills](Barclays/sustainability/supporting-our-communities/) | | |  |
|  |  |  |  |  |
|  |  |  |  | Barclays’ climate and ESG-related data, targets and progress  can be found in the Barclays Climate and Sustainability report  from page [59](#i4be61753b7f243b19551b0bfbf3a2a0d_244). and within the ESG (non-financial) Data Centre  within our ESG Resource hub: [home.barclays/sustainability/esg-](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [resource-hub/reporting-and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/) | |  |  |
|  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |

Climate

Barclays is committed to achieving its ambition

to be a net zero bank by 2050. We are focused on

reducing our financed emissions through our

policies, targets and financing. This includes

working with our clients as they decarbonise and

supporting their efforts to transition the real

economy in a manner that is just, orderly and

provides energy security.

We have now set 2030 reduction targets for

eight of the highest-emitting sectors in our

portfolio: Energy, Power, Cement, Steel,

Automotive manufacturing, Aviation, Agriculture

and Commercial Real Estate; and assessed the

baseline and convergence point for our UK

Housing portfolio. This meets our commitment

under the Net Zero Banking Alliance (NZBA) to

set targets for material high-emitting sectors in

our portfolio.

Note:

1 For details on the scope and application of the updated positions

please refer to the Climate Change Statement found: home.barclays/

sustainability/esg-resource-hub/statements-and-policy-positions/

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  |  |  |  |
|  | Moray West offshore wind farm  In 2023 Barclays provided approximately  £100 million in loans and CPI, IRS & FX  hedging to support Moray West offshore  wind farm, developed by Ocean Winds.  Once constructed, the project is expected  to provide a secure, reliable source of  energy to supply the equivalent of 50% of  Scotland’s domestic electricity – the same  as the power needs of up to 1.33 million  homes. |  |  |  |
|  |  |  |  |  |

Our policies are a lever for reducing our financed

emissions. In 2024, we updated our Climate

Change Statement, to include1:

• No project finance, or other direct finance to

energy companies, for upstream oil and gas

expansion projects or related infrastructure.

• Restrictions for new energy company clients

engaged in expansion from January 2025.

• Restrictions on non-diversified energy

companies engaged in long lead expansion.

• Additional restrictions on unconventional oil

and gas, including Amazon and extra heavy oil.

• Requirements for energy companies to have

2030 methane reduction targets, a

commitment to end all routine / non-essential

venting and flaring by 2030 and near-term net

zero aligned Scope 1 and 2 targets from

January 2026.

• Expectations for energy companies to

produce relevant information in relation to

their transition plans or decarbonisation

strategies by January 2025.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 30 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Society | | | | | | | | | | |

![Society_FO_1.png]()

![Bokalift 2 Invergordon _Moray West offshore wind farm.png]()

We understand that capital is critical for a

successful energy transition and are focusing our

financing to those clients actively engaged in the

energy transition.

The scale of our business gives us the

opportunity to help finance the energy transition

– to use our global reach, products, expertise and

position in the global economy to work with our

clients, including those in the energy sector, as

they transition to a low-carbon business model.

|  |  |
| --- | --- |
|  |  |
| + | Please see the full Climate Change Statement at:  home.barclays/sustainability/esg-resource-hub/  statements-and-policy-positions/ |
|  |

In 2024, we also published the Barclays Transition

Finance Framework, outlining the criteria for

transactions to be included towards Barclays’

target to facilitate $1trn of Sustainable and

Transition Finance between 2023 and 2030.

In 2023, we financed $67.8bn of Sustainable and

Transition Finance, demonstrating good

momentum towards our target of $1trn by the

end of 2030.

|  |  |
| --- | --- |
|  |  |
| + | Please see page [70](#i4be61753b7f243b19551b0bfbf3a2a0d_17952) of the Climate and Sustainability report  for further detail on our Transition Finance Framework. |
|  |

In addition, Barclays’ Sustainable Impact Capital

portfolio has a mandate to invest up to £500m of

the Bank’s own capital in sustainability-focused

start-ups by 2027, helping accelerate the

transition towards a low-carbon economy. To

date, 21 investments have been made, deploying

over £138m since 2020. Following investment,

companies are offered access to the Bank’s

wider ecosystem of support – including space at

Rise, Barclays’ FinTech hubs, where cutting-edge

start-ups and scale-ups can connect, create and

scale their businesses.

Communities

Barclays is committed to building a stronger,

more inclusive economy that is better for

everyone. We are supporting local communities

where we operate by enabling people to develop

the skills and confidence they need to succeed,

and helping businesses to grow and create jobs.

We regularly engage with our community

partners to help shape our strategy and deepen

our understanding of evolving societal issues. We

request formal quantitative and qualitative

information from our charity partners on a

quarterly basis and regularly seek feedback from

the CEOs we support through our Unreasonable

Impact programme - a partnership between

Barclays and Unreasonable Group, detailed

further on the following page.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  |  |  |  |
|  | LifeSkills in the UK  Barclays is proud of the positive impact LifeSkills has made over the past  10 years.  With social inequalities continuing to rise, there is more to do to support  underserved communities – which is why we are putting socio-economic  inclusion at the heart of the LifeSkills programme to give more help to  people who would otherwise be left behind.  The focus of new investment is for people in the UK’s most underserved  communities and underrepresented groups. We are working in  partnership with respected charities, the education sector, the business  community and Barclays' colleagues to support families, young people  and young adults to thrive – now and in the future. |  |  |  |
|  |  |  |  |  |
|  |  |  |  |  |
|  |  |  |  |  |

Feedback and data from our community

partners, charity partners and the businesses we

support helps inform and evolve our

programmes to ensure they best meet their

needs.

Skills and employability

We believe everyone deserves the financial

independence, security and opportunity that

comes with a job – and a vibrant, skilled workforce

ensures local communities and businesses can

thrive. In 2023 our programmes reached more

than 3.27 million people around the world,

unlocking the skills and employment

opportunities people need to progress.

Barclays' LifeSkills programme has been

delivering a positive impact in UK communities

for a decade, helping millions of people develop

the vital employability and financial skills they

need to succeed at work, thrive in the digital age

and better manage their money. Through the

next chapter of our LifeSkills programme,

Barclays has committed to upskilling 8.7 million

people and placing 250,000 people into work by

the end of 2027.

In addition, Barclays’ Military and Veterans

Outreach programme provides support to service

personnel, veterans and their families to develop

the skills they need to transition to civilian life, build

careers beyond the military and grow their own

businesses. Our Digital Eagles programme, which

upskilled more than 622,000 people in 2023, is

enabling people to become more confident with

technology and stay safe online.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 31 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Society (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | Find out more here:  home.barclays/lifeskills |
|  |

![Society_FO3.png]()

We also recognise the power of sport to engage

and strengthen communities. The Barclays

Community Football Fund has helped more than

2,900 community sports groups make football

more accessible to underrepresented groups,

reaching more than 400,000 young people.

In 2023, as Official Banking Partner of The

Championships, Wimbledon, Barclays made the

largest ever partner donation to the Wimbledon

Foundation1 and connected Barclays LifeSkills to

the UK Set for Success programme and the

Barclays Net Work programme in the US.

Using sport, and through mentoring sessions

with inspirational athletes, both initiatives provide

young people from underserved communities

the opportunity to develop valuable life skills.

The UK Set for Success programme aims to

support 3,900 people in 30 regions across the UK

over the next four years.

Sustainable growth

Businesses are the engines of growth and

innovation in communities around the world,

pioneering solutions to support the transition to

a more sustainable, inclusive and just future.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  |  |  |  |
|  | Female Founder Accelerator  In 2023, through Barclays’ Eagle Labs, we launched our first  Female Founder Accelerator, in partnership with AccelerateHER  — supporting 40 female-led technology businesses to address  the gender imbalance in the entrepreneur community.  In 2024, the Female Founder Accelerator is funded by the UK  Government and will support a further 100 businesses. During the  nine-week programme, founders work with experts from across  the entrepreneurial landscape in a series of masterclasses, with  the focus on developing their business propositions further. |  | OCETY_CSE_TUY4.jpg |  |
|  |  |  |  |
|  |  |  |  |  |

Barclays is well-positioned with the capabilities,

resources and networks to support the growth of

these businesses at each stage of the lifecycle -

from idea to IPO - with a dynamic package of

innovative programming, workspaces and

investment. In 2023, more than 5,600 businesses

were supported through our programmes³.

Through our Unreasonable Impact programme, we

support high-growth entrepreneurs around the

world with the network, resources and mentorship

to address global issues and scale their businesses.

In 2023, Barclays committed to support an

additional 200 ventures through the programme by

the end of 2027. More than 300 ventures have been

supported so far, collectively raising over $11bn in

financing and employing more than 25,000 people.

Through Eagle Labs, we are also helping

entrepreneurs in UK communities who are just

starting out – giving them access to mentors, office

space and a collaborative community.

Charitable giving and investment

in our communities

Barclays supports employees to make a positive

difference to the causes that matter most

to them. In 2023, we supported more than

4,800 colleagues around the world to fundraise and

donate to their chosen charities - with a total of

£7.6m, including matching, given to more than

1,700 charities. We also supported

10,360 colleagues to donate £2m in total, with

matching, via our UK Payroll Giving programme.

Barclays supports communities directly by investing

money and skills in partnerships with respected

non-governmental organisations, charities and

social enterprises. Our investment amounted to

£49.3m in 2023 including charitable giving,

management costs and monetised work hours of

Barclays' colleagues.

Suppliers

As a global institution, we have responsibility for a

large supply chain. We engage directly with our

Suppliers - our Third Party Service Providers

(TPSPs) - to promote Diversity, Equity and Inclusion

and we are committed to trying to identify and

seeking to address the modern slavery risks in our

supply chain.

We work closely with our TPSPs and set out our

expectations in our Third Party Service Provider

Code of Conduct (TPSP CoC). The TPSP CoC

encourages our TPSPs to adopt our approach to

doing business and details our expectations for

matters including environmental management,

human rights, diversity and inclusion and also for

living the Barclays Values.

|  |  |
| --- | --- |
|  |  |
| + | Please see here for further information:  home.barclays/who-we-are/our-suppliers/our-requirements-  of-external-suppliers/ |
|  |

We aim to pay our TPSPs within clearly defined

terms and achieved 93% on-time payment to

our suppliers at the end of 2023 (93% at the end

of 2022), exceeding our public commitment of

85%². Barclays is also proud to be a signatory of

the Prompt Payment Code in the UK.

Note:

1 [wimbledon.com/en\_GB/news/articles/2022-11-22/](wimbledon.com/en_GB/news/articles/2022-11-22/barclays_announced_as_official_banking_partner_of_the_championships_wimbledon_from_2023.html)

[barclays\_announced\_as\_official\_banking\_partner\_of\_the\_cham](wimbledon.com/en_GB/news/articles/2022-11-22/barclays_announced_as_official_banking_partner_of_the_championships_wimbledon_from_2023.html)

[pionships\_wimbledon\_from\_2023.html](wimbledon.com/en_GB/news/articles/2022-11-22/barclays_announced_as_official_banking_partner_of_the_championships_wimbledon_from_2023.html)

2 We measure prompt payment globally by calculating the percentage

of TPSP spend paid within 45 days following invoice date. This

measurement applies against all invoices by value over a three month

average period.

3 5,633 businesses were supported.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Wimbledon_case_Study.jpg |  |
|  |  |  |
|  | Wimbledon  In 2023 Barclays launched a multi-year  partnership with the All England Lawn Tennis  Club as the Official Banking Partner of  Wimbledon. In our first year, to accompany  our partnership, we delivered an international  campaign bringing in our customers, clients,  colleagues and communities.  • Customers benefited from perks and  elevated Premier giveaways.  • We showcased two of our Unreasonable  Impact businesses. 80 Acres Farms, a  company also supported by Barclays  Sustainable Impact Capital, built a one-of-  a-kind vertical strawberry farm on site, while  CLUBZERØ supported us with returnable  packaging. Over 6,000 Wimbledon  attendees interacted with these two  businesses over the course of The  Championships, providing unique  exposure.  • Additionally, we delivered for our  communities with the Wimbledon  Foundation by leveraging Barclays LifeSkills  to expand the UK Set for Success  programme, and launched the Barclays Net  Work employability programme in the US'. |  |
|  |  |  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 32 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Society (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | For further information please see here: labs.uk.barclays/  what-we-offer/our-programmes/  female-founder-accelerator/ |
|  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Operational GHG  emissions (market-based)  (tonnes CO 2 e) |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![7]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  Barclays is working to achieve net  zero operations, consistent with a  1.5°C aligned pathway, and  counterbalance any residual  emissions.  This metric measures total gross  Scope 1 and 2 (market-based)  emissions generated from  Barclays’ branches, offices and  data centres, including all indirect  emissions from electricity  consumption. | |  |
|  | How we performed  We continued to source 100%Δ  renewable electricity for our global  real estate portfolio and continued  to meet our 90% Scope 1 and 2  market-based emissions  reduction target – reducing these  emissions by 93%Δ. | |  |

|  |  |
| --- | --- |
|  |  |
| + | See page [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) for details on Executive  Director remuneration linked to these KPIs |
|  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Social, environmental and  sustainability-linked  financing facilitated  ($bn) |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![20]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  In 2022, we set a target of $1trn  Sustainable and Transition  Financing between 2023 and 2030  – encompassing green, social,  transition and sustainability-linked  financing, having met our previous  target to facilitate £150bn of  social, environmental and  sustainability linked financing by  2025. | |  |
|  | How we performed  In the first full year of our new  $1trn target by 2030, we have  facilitated $67.8bnΔ,  demonstrating good momentum. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Skills and employability:  Number of people  upskilled  (millions) |  |

|  |
| --- |
|  |
| 2023 |

![26]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  Barclays is delivering skills and  employment opportunities for  people in the communities where  we operate. The total number of  people supported to unlock skills  and employment opportunities  includes those upskilled through  our LifeSkills, Digital Eagles and  Military and Veterans Outreach  programmes. | |  |
|  | How we performed  This KPI is new for 2023. In 2023,  our impact measurement and  reporting evolved to demonstrate  Barclays’ holistic impact in  communities, through Barclays  LifeSkills, Digital Eagles and Military  and Veterans Outreach. In  previous years, Barclays reported  the number of people upskilled  solely through LifeSkills, which for  2023 is 2.6m Δ (2022: 2.7m). From  2023, new investment through  LifeSkills is focused on targeted  support for people in underserved  communities, resulting in a smaller  number of people reached overall  through our programme. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Sustainable growth:  Number of businesses  supported (thousands) |  |

|  |
| --- |
|  |
| 2023 |

![58823872086060]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  Barclays is championing innovation  and sustainable growth through  programmes that unlock the world  of finance, enabling businesses  and economies to grow. The total  number of businesses supported  in our communities includes those  engaged through Barclays’ Eagle  Labs, Rise, Sustainable Impact  Capital and Unreasonable Impact. | |  |
|  | How we performed  This KPI is new for 2023. In 2023,  our impact measurement and  reporting evolved to demonstrate  Barclays’ holistic impact in  communities. See the ‘Society'  section on pages 31-32 for more  information. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Our current estimate of  our financed emissions  based on our disclosed  BlueTrackTM methodology |  |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | Portfolio |  | December 2023 |  | Cumulative  performance  vs. baseline |  |
|  |  |  |  |  |  |  |
|  | Energy |  | 42.5Δ MtCO2e  (absolute emissions) |  | -44% |  |
|  | Power |  | 241Δ KgCO2e/MWh  (physical intensity) |  | -26% |  |
|  | Cement |  | 0.573Δ  tCO2e/t  (physical intensity) |  | -8% |  |
|  | Metals (Steel) |  | 1.635Δ tCO2e/t  (physical intensity) |  | -16% |  |
|  | Automotive  manufacturing |  | 175.2Δ gCO2e/km  (physical intensity) |  | 0% |  |
|  | UK Housing |  | 32.1Δ kgCO2e/m2  (physical intensity) |  | N/A |  |
|  | UK Commercial  real estate |  | 30.0Δ kgCO2 e m 2  (physical intensity) |  | N/A |  |
|  | Agriculture |  | 2.4Δ MtCO2e  (absolute emissions) |  | N/A |  |
|  | Aviation |  | 882Δ gCO2e/RTK  (physical intensity) |  | N/A |  |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | Date baseline set: | |  |  |
|  | n | December 2020 | n | December 2021 |
|  | n | December 2022 | n | December 2023 |

|  |  |
| --- | --- |
|  |  |
|  | About this KPI and why we use it  We continue to assess the financed  emissions across our portfolio and measure  the baseline emissions we finance across  sectors. Our assessment will inform our  plan for target setting in the coming years  and  support our better understanding of  the extent to which our financing aligns with  a 'well below 2°C' pathway. |
|  | How we performed  During 2023 we added further sectors to our  BlueTrackTM methodology, progressing  towards our NZBA commitment to set  science-based targets for all material high-  emitting sectors (as defined by the NZBA) in  our portfolio by April 2024.  Our detailed analysis of our sectors and  performance is contained within the Climate  & Sustainability section from page 80. |

Note

Δ  2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub: [home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)

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|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 33 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Society (continued) | | | | | | | | | | |
| Society - our KPIs | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | Please see page 101 for  further detail on our target. |
|  |

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| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  |  | Investors | | | | |  |
|  |  |  |
|  |  | Our investor stakeholder group encompasses investors,  rating agencies and other market participants with an  interest in the financial performance of the Group. | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  |  | Where to find out more: | | |  |  |
|  |  |  | + | Further details can be found at:  [home.barclays/investor-relations/](https://home.barclays/investor-relations/) |  |  |  |
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|  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |

Engaging with investors

Through the year we maintained active

engagement with our stakeholders across a

number of themes, including capital strategy and

allocation, divisional performance and the impact

of the changing macroeconomic environment.

This bilateral engagement has helped inform our

Investor Update and our plans to deliver further

value to our shareholders and stakeholders. The

combination of our 2023 Results

Announcement, Resegmentation document,

and the Investor Update in February 2024

provide further detail on our three-year plan to

deliver higher returns, our capital allocation

priorities and revised financial targets, as well as

the updated divisional structure we will report

upon from Q1 2024.

We also engaged extensively regarding our

climate strategy, methodology, and the actions

we have taken to build a sustainable bank.

Alongside this, our engagement also covered

how we have utilised the Board and senior

management to engage with other corporates

on governance and the control environment.

Shareholder feedback on ESG demonstrated a

focus on the development of our climate

strategy and policies. In February 2024, we

updated our Climate Change Statement,

including our policies, targets and financing to

reduce financed emissions.

Our 2024 AGM will be hosted in Glasgow to

continue our wider engagement with

shareholders.

Performance during the year

Barclays delivered a Group statutory RoTE of

9.0% (2022: 10.4%) with profit before tax of

£6.6bn (2022: £7.0bn), which included £0.9bn of

structural costs actions in Q423. The prior year

included the impact of the Over-issuance of

Securities.

The following performance highlights exclude

the impact of the Q423 structural cost actions

and the impact of the Over-issuance of

Securities in the prior year1.

Group RoTE of 10.6% (2022: 11.6%) with profit

before tax of £7.5bn (2022: £7.7bn)

Group income of £25.4bn, up 3% year-on-year:

Barclays UK income increased 5% to £7.6bn,

driven by net interest income growth from higher

rates, including higher structural hedge income.

Corporate and Investment Bank (CIB) income

decreased 4% to £12.6bn, driven by lower client

activity in both Global Markets and Investment

Banking, partially offset by a strong performance

in Corporate driven by Transaction Banking.

Consumer Cards and Payments (CC&P) income

increased 18% to £5.3bn reflecting higher

balances in US cards and favourability from

higher rates and client balance growth in Private

Bank.

Group total operating expenses were £16.0bn,

up 2% year-on-year. Cost: income ratio of

63%as the Group delivered positive cost: income

jaws of 1%.

Credit impairment charges were £1.9bn (2022:

£1.2bn) with an LLR of 46bps (2022: 30bps).

CET1 ratio of 13.8% (2022: 13.9%), with risk

weighted assets (RWAs) of £342.7bn (December

2022: £336.5bn) and tangible net asset value per

share of 331p (December 2022: 295p).

Capital distributions: Total capital distributions of

£3.0bn announced in relation to 2023, up c.37%

on 2022, reflecting a total dividend of 8.0p and

total share buybacks of £1.75bn for 2023. This

includes our intention to initiate a further share

buyback of up to £1.0bn.

Note:

1 Page 391 includes a reconciliation of financial results excluding

the impact of Q423 structural costs actions and the Over-

issuance of Securities in 2022.

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 34 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Investors | | | | | | | | | | |

![Investors.png]()

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Consolidated summary income statement | | |
| For the year ended 31 December | 2023  £m | 2022  £m |
| Net interest income | 12,709 | 10,572 |
| Net fee, commission and other income | 12,669 | 14,384 |
| Total income | 25,378 | 24,956 |
|  |  |  |
| Operating costs | (16,714) | (14,957) |
| UK bank levy | (180) | (176) |
| Litigation and conduct | (37) | (1,597) |
| Total operating expenses | (16,931) | (16,730) |
|  |  |  |
| Other net income | (9) | 6 |
| Profit before impairment | 8,438 | 8,232 |
| Credit impairment (charges)/releases | (1,881) | (1,220) |
| Profit before tax | 6,557 | 7,012 |
| Tax charge | (1,234) | (1,039) |
| Profit after tax | 5,323 | 5,973 |
| Non-controlling interests | (64) | (45) |
| Other equity instrument holders | (985) | (905) |
| Attributable profit | 4,274 | 5,023 |
|  |  |  |
| Selected financial statistics |  |  |
| Basic earnings per share | 27.7p | 30.8p |
| Diluted earnings per share | 26.9p | 29.8p |
| Return on average tangible shareholders’ equity | 9.0% | 10.4% |
| Cost: income ratio | 67% | 67% |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Consolidated summary balance sheet | | |
| As at 31 December | 2023  £m | 2022  £m |
| Assets |  |  |
| Cash and balances at central banks | 224,634 | 256,351 |
| Cash collateral and settlement balances | 108,889 | 112,597 |
| Loans and advances at amortised cost | 399,496 | 398,779 |
| Reverse repurchase agreements and other similar secured lending | 2,594 | 776 |
| Trading portfolio assets | 174,605 | 133,813 |
| Financial assets at fair value through the income statement | 206,651 | 213,568 |
| Derivative financial instruments | 256,836 | 302,380 |
| Financial assets at fair value through other comprehensive income | 71,836 | 65,062 |
| Other assets | 31,946 | 30,373 |
| Total assets | 1,477,487 | 1,513,699 |
| Liabilities |  |  |
| Deposits at amortised cost | 538,789 | 545,782 |
| Cash collateral and settlement balances | 94,084 | 96,927 |
| Repurchase agreements and other similar secured borrowings | 41,601 | 27,052 |
| Debt securities in issue | 96,825 | 112,881 |
| Subordinated liabilities | 10,494 | 11,423 |
| Trading portfolio liabilities | 58,669 | 72,924 |
| Financial liabilities designated at fair value | 297,539 | 271,637 |
| Derivative financial instruments | 250,044 | 289,620 |
| Other liabilities | 17,578 | 16,193 |
| Total liabilities | 1,405,623 | 1,444,439 |
| Equity |  |  |
| Called up share capital and share premium | 4,288 | 4,373 |
| Other equity instruments | 13,259 | 13,284 |
| Other reserves | (77) | (2,192) |
| Retained earnings | 53,734 | 52,827 |
| Total equity excluding non-controlling interests | 71,204 | 68,292 |
| Non-controlling interests | 660 | 968 |
| Total equity | 71,864 | 69,260 |
| Total liabilities and equity | 1,477,487 | 1,513,699 |
|  |  |  |
| Net asset value per ordinary share | 382p | 347p |
| Tangible net asset value per share | 331p | 295p |
| Number of ordinary shares of Barclays PLC (in millions) | 15,155 | 15,871 |
|  |  |  |
| Year-end USD exchange rate | 1.28 | 1.20 |
| Year-end EUR exchange rate | 1.15 | 1.13 |

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 35 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Investors (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Common Equity Tier 1 (CET1) ratio1  (%) |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![42331197669413]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  CET1 ratio is a measure of the capital  strength and resilience of Barclays,  determined in accordance with regulatory  requirements. The Group's capital  management objective is to maximise  shareholder value by prudently managing the  level and mix of its capital. This is to ensure  the Group is appropriately capitalised relative  to the minimum regulatory and stressed  capital requirements, and to support the  Group's risk appetite, growth, and strategy  whilst seeking to maintain a robust credit  proposition for the Group.  The ratio expresses the Group's CET1 capital  as a percentage of its RWAs. RWAs are a  measure of the Group's assets adjusted for  their respective associated risks. | |  |
|  |  |  |  |
|  | How we performed  The CET1 ratio decreased to 13.8%  (December 2022: 13.9%), within our target  range, as RWAs increased by £6.2bn to  £342.7bn partially offset by an increase in  CET1 capital of £0.4bn to £47.3bn. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Group return on tangible equity  (RoTE)1 (%) |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![42331197669423]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  RoTE measures our ability to generate  returns for shareholders. It is calculated as  profit after tax attributable to ordinary  shareholders as a proportion of average  shareholders’ equity excluding non-  controlling interests and other equity  instruments adjusted for the deduction of  intangible assets and goodwill. This measure  indicates the return generated by the  management of the business based on  shareholders’ tangible equity.  Achieving a target RoTE demonstrates the  organisation’s ability to execute its strategy  and to align management’s interests with  those of its shareholders. RoTE lies at the  heart of the Group’s capital allocation and  performance management process. | |  |
|  |  |  |  |
|  | How we performed  Statutory RoTE was 9.0% (2022: 10.4%)  including £0.9bn of structural cost actions in  Q423.  Excluding Q423 structural cost actions, RoTE  was 10.6%3. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Total operating expenses1, 2  (£bn) |  |

![42331197669624]()

![42331197669442]()

![42331197669443]()

|  |  |  |
| --- | --- | --- |
|  |  |  |
| 2023 | 2022 | 2021 |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  We view total operating expenses as a key  strategic area for banks. Those that actively  manage costs and control them effectively  will gain a strong competitive advantage. | |  |
|  |  |  |  |
|  | How we performed  Group operating expenses increased to  £16.9bn (2022: £16.7bn) reflecting £0.9bn of  structural cost actions in Q423, business  growth and investments in resilience and  controls, partially offset by lower litigation  and conduct charges.  The prior year included £1.0bn of litigation  and conduct charges related to the Over-  issuance of Securities. | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Cost: income ratio1  (%) |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![42331197669433]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | About this KPI and why we use it  The cost: income ratio measures total  operating expenses as a percentage of total  income and is used to assess the productivity  of our business operations. | |  |
|  |  |  |  |
|  | How we performed  The Group cost: income ratio was 67%  (2022: 67%). Excluding Q423 structural cost  actions, Group cost: income ratio was 63%2  as the Group delivered positive jaws of 1%. | |  |

|  |
| --- |
|  |
| Notes  1 KPIs reflect the targets and ambitions followed during 2023. On 20 February 2024, the 2023 Results Announcement set out refreshed targets and ambitions which future progress will be measured against. Please see page [13](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061823) for further detail, or [home.barclays/strategy](https://home.barclays/strategy)  2 Litigation and conduct in 2023: £37m, 2022: £1,597m, which includes £966m related to the Over-issuance of Securities and 2021: £397m.  3 Page [391](#i4be61753b7f243b19551b0bfbf3a2a0d_20532) includes a reconciliation of financial results excluding the impact of Q423 structural costs actions  and the Over-issuance of Securities in 2022. |

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 36 |
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| Investors (continued) | | | | | | | | | | |
| Investors – our KPIs | | | | | | | | | | |

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| --- | --- |
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| Target greater than 10% |  |

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| --- | --- |
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| Target range 13-14% |  |

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| --- | --- |
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| Below 60% |  |

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| --- | --- |
|  |  |
| + | See page  [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) for details on Executive Director  remuneration linked to these KPIs |
|  |

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| Additional disclosure | |  |  |  |
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|  |  |  | In this section we disclose  information as required by  Companies Act 2006 and various  other information to help navigate  the Annual Report 2023. |  |
|  |  |  | Section 172 statement |  |
|  |  |  | Non-financial and sustainability  information Statement |  |
|  |  |  | TCFD compliance |  |
|  |  |  | ESG ratings and reporting |  |
|  |  |  | Managing risk |  |
|  |  |  | Viability statement |  |
|  |  |  |  |  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 37 |
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| --- | --- | --- |
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| How the Board has  regard to the views  of our stakeholders |  | In accordance with the Companies Act 2006 (the Act),  this statement sets out how the Directors have had  regard to the matters set out in Section 172(1) of the  Act when performing their duty to promote the success  of the Company under Section 172. |

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| --- | --- | --- |
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|  | You can read more about our key  stakeholder groups and how we listen  and respond to them, striving to create  sustainable value for all those we serve in  Our Stakeholders from page [23](#i4be61753b7f243b19551b0bfbf3a2a0d_10994). You can also  read about the key activities of the Board and  decisions taken during the year, along with  details of the Board’s engagement with  colleagues in Key Board Activities in 2023  in the Board Governance report. |  |
|  |  |  |

Overview

Throughout the year, the Board and individual

Directors engage directly and indirectly with

stakeholders to ensure they have a deep

understanding of the impact of the Group’s

operations on key stakeholders, as well as their

interests and views. This includes meeting with

customers and clients, colleagues, investors,

proxy advisers, key regulators, NGOs and other

stakeholders.

This engagement, both directly and through

reporting by executive management, to whom the

day-to-day operations of the business are

delegated, seeks to ensure the Board understands

the key issues to enable the Directors to comply

with their legal duty under Section 172(1).

You can find out more about how the Directors

have had regard to the matters set out in Section

172(1) when discharging their duties, and the

effect of those considerations in reaching certain

decisions below.

Embedding a standard of consistent

excellence across Barclays

As reported in our 2022 Annual Report, towards

the end of 2022, Barclays established a group-

wide cultural change programme led by our

Group Chief Executive, to set a standard of

consistent excellence, recognising that both our

stakeholders and management want Barclays

to perform at a consistently very high level, each

and every day. This programme challenges

colleagues to address five key areas – service,

precision, focus, simplicity and diversity of

thought – to establish a new operating standard.

This programme is supported by our existing

Purpose, Values and Mindset. The Board

recognises that this cultural change programme

is key to driving better outcomes for Barclays'

stakeholders, including for our investors,

customers, clients and colleagues. As such,

oversight of this programme has been a key area

of focus for the Board in 2023.

In 2023, the Board received updates on the

progress of this programme at each Board

meeting, including the key levers necessary

to achieve the required outcomes.

Board members have discussed with

management the importance of ‘tone from

the top’, recognising the need for senior

leadership accountability and support in order

to drive a broader cultural shift across the

wider colleague base.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | What a consistently excellent standard means to Barclays | | | | |  |
|  | We are holding ourselves to a high standard across: | | | | |  |
|  | Service:  world-class  service  for clients  and customers,  every time | Precision:  in our operations,  our risk  management  and our controls | Focus:  on businesses  and projects  where we  can excel | Simplicity:  simplicity  and efficiency,  seeking out every  opportunity  to automate | Diversity  of thought:  championing  new thinking,  and challenging  the status quo |  |
|  |  |  |  |  |  |  |

The Board recognises that in order to drive

change across the organisation it is key that

colleagues understand and believe in the aims

of the programme and recognise their personal

accountability for delivering the right outcomes,

including their role in challenging processes and

controls that can be improved or simplified.

To support this, a high profile internal campaign

led by the Group Executive Committee has been

launched which recognises and celebrates the

successes of colleagues in driving simplification,

and risk and control improvements across the

organisation, providing real examples which bring

the aim of the programme to life. Throughout

2023, a programme of events has been held for

management level colleagues, the aim of which is

to ensure senior colleagues understand the

importance of the programme objectives and

that they are supported in developing the skills

they need to implement and embed the change

in the organisation.

|  |
| --- |
|  |
|  |

This included Consistently Excellent workshops for

our senior leaders, to help create a common

understanding across the Group. In 2024, all

colleagues will be invited to attend these workshops.

As part of that programme, our Group Chief

Executive interviewed Brian Gilvary, our Senior

Independent Director, about his experiences during

his executive career of dealing with operational

challenges and cultural change programmes.

A key part of achieving the aims of this cultural

change programme is driving operational

excellence. The Board Audit Committee has

oversight of the execution and sustainable

embedding of the Group’s key remediation

programmes, and received regular briefings

throughout the year on the progress of these

programmes, including deep dives into

specific projects.

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 38 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Section 172(1) statement | | | | | | | | | | |

![Section 172_Image.jpg]()

A key area to achieving success in this area is

the related work to identify lessons learned

from these remediation programmes, and

to embed those learnings into standard

business practices.

The Board has discussed with management

the need to ensure that desired outcomes are

measured and tracked, with regular insight being

provided to the Board and management relating

to improvements in customer experience,

operational excellence, risk management,

colleague behaviour and financial delivery.

|  |
| --- |
|  |
|  |
| “To be a consistently excellent organisation,  we must be ambitious and focused...  with each of us taking personal accountability” |
| C. S. Venkatakrishnan  Group Chief Executive |

The Board recognises that a cultural and

behavioural change programme of this nature is

both complex and multi-year and, as such, the

embedding and sustainability of this programme

will continue to be an area of focus for the Board

throughout 2024 and beyond.

Implementing and embedding

the new FCA Consumer Duty

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | In July 2023, the Financial Conduct  Authority's (FCA) Consumer Duty came  into force. The Consumer Duty is a new  outcomes-based regulation, designed  to ensure relevant financial services firms  deliver good outcomes for retail customers  consistent with the three cross-cutting  rules to (i) act in good faith, (ii) avoid  causing foreseeable harm, and (iii) enable  and support retail customers, and the four  retail customers outcomes relating to:  (i) products and services, (ii) price and value,  (iii) consumer understanding, and (iv)  consumer support. |  |
|  |  |  |

The implementation of, and ongoing compliance

with, the Consumer Duty is the responsibility

of the operating entities within the Group,

primarily BBPLC and BBUKPLC. However,

given the significance of the Consumer Duty,

the Board also provides relevant oversight of

the Consumer Duty across the Group. In this

respect, in February 2023, the Board approved

changes to its Matters Reserved in order to

reflect its responsibility for this oversight.

Throughout the first half of 2023, the Board

retained oversight of Barclays' planning for the

first Consumer Duty implementation deadline of

31 July 2023 for in-scope products and services.

In addition to receiving its regular updates on the

status of the Group’s implementation plans, the

Board received a final update on the Group's

overall compliance readiness shortly before the

July implementation deadline. This update

included information on work conducted to

ensure all relevant Group frameworks align with

the Consumer Duty rules and guidance and

ongoing work to embed the Consumer Duty,

including the roll-out of mandatory Consumer

Duty training for colleagues.

A Consumer Duty lens has been applied in the

development of the Barclays Group-wide change

programme, Consistently Excellent, with the

spirit of the Consumer Duty reflected in the

‘world-class service for clients and customers’. In

May 2023, the Chairman, together with Mary

Francis (as BBPLC Consumer Duty Champion)

and the BBUKPLC Consumer Duty Champion,

visited our contact centre in Wavertree,

Liverpool, to experience Consumer Duty in

action, meeting with customer-facing colleagues

and learning about how Barclays is addressing

vulnerable customer needs.

In late 2023, the Board received a further

progress report on the continuing work to

operationalise and embed the Consumer Duty

across the Group, the roll-out of new Consumer

Duty management information and ongoing

planning for the second implementation date of

31 July 2024 for closed products.

One continuing area of Board focus is the Group

oversight of work to develop robust data and

monitoring capabilities to assess customer

outcomes and identify potential or actual risks,

and for reporting at business, Executive and

Board level.

Given the Group-wide significance of the

Consumer Duty, throughout 2023, there has

been extensive engagement by the Boards of

BPLC, BBPLC and BBUKPLC on this subject.

The Board will continue its oversight of BBPLC

and BBUKPLC's embedding and implementation

of the Consumer Duty in 2024, noting that, from

July 2024, each of the BBPLC and BBUKPLC

Boards is required to review and approve its first

assessment as to whether each business is

delivering good outcomes for its retail customers

which are consistent with the Consumer Duty.

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 39 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Section 172(1) statement (continued) | | | | | | | | | | |

Our Group Chief Executive, C.S.

Venkatakrishnan, together with Group

Executive Committee members, Sasha

Wiggins and Vim Maru, discussing what it

means to deliver to a consistently

excellent standard with colleagues in

Wilmington, USA.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Non-financial and  sustainability information  statement |  |  |

The non-financial and sustainability reporting

requirements (including the new climate-related

financial disclosures) contained in Sections

414CA and 414CB of the Companies Act 2006

have been addressed through a combination of

summary text and cross referencing to other

sections of the Annual Report. We have used

cross-referencing as appropriate to deliver clear,

concise and transparent reporting.

In addition to the information referred to in the

table below, further information about the impact

of our activities can be found in the following

sections of the Annual Report:

Part 1 of this statement addresses the non-

financial information requirements set out in

section 414CB(1) and (2).

Part 2 of this statement addresses the new

climate-related financial disclosure requirements

set out in section 414CB(A1) and (2A).

Part 1

Relevant information relating to business model,

principal risks and non-financial key performance

indicators can be found in the following sections

of the Annual Report:

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Section | Pages |
| Business model |  | [10](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686056057),  [60](#i4be61753b7f243b19551b0bfbf3a2a0d_17257)- [65](#i4be61753b7f243b19551b0bfbf3a2a0d_18279) |
| Principal risks | Managing risk | [51](#i4be61753b7f243b19551b0bfbf3a2a0d_11690)-[53](#ib469fcf3a9f54c04968fe109fafad382_12-2-1-1-1841111) |
|  | Principal Risk management | [272](#i4be61753b7f243b19551b0bfbf3a2a0d_655)-[283](#ifce86789da254949993d2658bd416f72_2614) \* |
|  | Risk performance | [284](#i4be61753b7f243b19551b0bfbf3a2a0d_694)-[362](#i4be61753b7f243b19551b0bfbf3a2a0d_796) \* |
| Key performance indicators |  | [26](#ibbf817da39c2484a987f90df3c4aad1b_1-1-1-1-2196881), [29](#i20ee8c6fe6664d3990aede1709d1ef59_1-1-1-1-2196888), [33](#i2a7098f2c0af4871ab483e7bc0ad1e02_1-1-1-1-2196891) ,  [36](#if38fb72d0c9e4a6589ef846dabe5d1be_1-1-1-1-2130038) ,  [75](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686060018) ,  [88](#i4be61753b7f243b19551b0bfbf3a2a0d_12116) ,  [103](#i4be61753b7f243b19551b0bfbf3a2a0d_328) |
| Impact | Environmental matters | [73](#i4be61753b7f243b19551b0bfbf3a2a0d_262) - [79](#i4be61753b7f243b19551b0bfbf3a2a0d_18002),  [80](#i4be61753b7f243b19551b0bfbf3a2a0d_283)  -  [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720) ,  [124](#i4be61753b7f243b19551b0bfbf3a2a0d_388)  -  [125](#i4be61753b7f243b19551b0bfbf3a2a0d_17308),  [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559)  - [237](#i4be61753b7f243b19551b0bfbf3a2a0d_8793) |
|  | Company employees | [27](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680650) - [29](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680617),  [246](#i4be61753b7f243b19551b0bfbf3a2a0d_565) ,  [250](#i4be61753b7f243b19551b0bfbf3a2a0d_574) |
|  | Social matters | [24](#i4be61753b7f243b19551b0bfbf3a2a0d_42880953494305) - [26](#i4be61753b7f243b19551b0bfbf3a2a0d_11093),  [30](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680602)  -  [33](#i4be61753b7f243b19551b0bfbf3a2a0d_58823872100933) ,  [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559)  -  [237](#i4be61753b7f243b19551b0bfbf3a2a0d_8793),  [238](#i4be61753b7f243b19551b0bfbf3a2a0d_172)  - [239](#i4be61753b7f243b19551b0bfbf3a2a0d_9181) ,  [239](#i4be61753b7f243b19551b0bfbf3a2a0d_9166) -  [241](#i8150e915ded5456682b14d908291ad16_89917) ,  [242](#i4be61753b7f243b19551b0bfbf3a2a0d_124) -  [244](#i4be61753b7f243b19551b0bfbf3a2a0d_17416) |
|  | Respect for human rights | [238](#i4be61753b7f243b19551b0bfbf3a2a0d_172) - [239](#i4be61753b7f243b19551b0bfbf3a2a0d_9181),  [239](#i4be61753b7f243b19551b0bfbf3a2a0d_9166)  -  [241](#i8150e915ded5456682b14d908291ad16_89917) |
|  | Anti corruption and  bribery matters | [249](#i4be61753b7f243b19551b0bfbf3a2a0d_571) |

Note:

\* in Part 3 of the Report

In relation to the requirements relating to

policies, we have a range of statements and

policy positions designed to support key

outcomes for all of our stakeholders, some of

which can be found here: [home.barclays/](https://home.barclays/sustainability/esg-resource-hub/)

[sustainability/esg-resource-hub/](https://home.barclays/sustainability/esg-resource-hub/)

These policies and statements are in place with

the aim of ensuring strengthened risk

management and consistent governance. In

order to maintain these policies and statements,

the relevant documents are reviewed

periodically.

|  |
| --- |
|  |
|  |

Performance against our strategic key

performance indicators for our stakeholder

groups, as shown from page [23](#i4be61753b7f243b19551b0bfbf3a2a0d_10994), is one indicator

of the effectiveness and outcome of policies

and guidance.

We have included summary information in

relation to these statements and policies in the

table below, providing cross references to

additional content contained in the Annual

Report where appropriate:

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 40 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-financial and sustainability information statement | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Environmental-related statements and policies | |  |
| Statement or policy  position | Description | Information to help  understand our Group and  its impact, policies, due  diligence and outcomes |
|  |  |  |
| Climate Change  statement | The Barclays Climate Change Statement sets out our approach based on a  consideration of all risk and market factors to certain energy and power  sectors with higher carbon-related exposures or emissions from  extraction or consumption, or those which may have an impact on certain  sensitive environments or on communities, namely thermal coal mining,  coal-fired power generation, mountain top coal removal, upstream oil and  gas and unconventional oil and gas including oil sands, Arctic oil and gas,  Amazon oil and gas, hydraulic fracturing ('fracking'), ultra-deep water and  extra heavy oil. The statement outlines Barclays' focus on supporting our  clients to transition to a low-carbon economy, while helping to limit the  threat that climate change poses to people and to the natural  environment. We conduct due diligence on a case-by-case basis on clients  in sensitive energy sectors that fall outside the restrictions set out in our  statement. | See our:  •  ‘Managing impacts in  lending and financing’  section in Part 3 of the  Annual Report (page  [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559) onwards).  • ‘Restrictive policies’  section in Part 2 of the  Annual Report (page  [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720)),  • Our approach to  nature and  biodiversity section in  Part 2 of the Annual  Report (page [124](#i4be61753b7f243b19551b0bfbf3a2a0d_391)).  • Our strategy, selected  targets and progress:  2) Reducing our  financed emissions –  Restrictive policies  section in Part 2 of the  Annual Report (page  [63](#i1da7e4cdbdd3469288df15f121af8119_2-2-1-1-2588142)). |
|  |  |  |
| Forestry and  Agricultural  Commodities  statement | We recognise that forestry and agricultural commodities sectors are  responsible for producing a range of agricultural commodities such as  timber, pulp & paper, palm oil, beef and soy that are often associated with  environmental and social impacts, including climate change, deforestation,  biodiversity loss and human rights issues. Our Forestry and Agricultural  Commodities Statement outlines our restrictions and due diligence  approach for clients involved in these activities, | See our:  • ‘Managing impacts in  lending and financing’  section in Part 3 of the  Annual Report (page  [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559) onwards).  • ‘Restrictive policies’  section in Part 2 of the  Annual Report (page  [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720)).  • ‘Our approach to  nature and  biodiversity’ section in  Part 2 of the Annual  Report (page [124](#i4be61753b7f243b19551b0bfbf3a2a0d_391)). |
|  |  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Environmental-related statements and policies (continued) | | |
| Statement or policy position | Description | Information to help  understand our Group and  its impact, policies, due  diligence and outcomes |
|  |  |  |
| World Heritage Site  and Ramsar  Wetlands  statement | We understand that industries can impact areas of high biodiversity  value including United Nations Educational, Scientific and Cultural  Organization (UNESCO) World Heritage Sites and Ramsar Wetlands  and their buffer zones. Our statement outlines our restrictions and  client due diligence approach that aims to preserve and safeguard  these sites. | See our:  • ‘Managing impacts in  lending and financing’  section in Part 3 of the  Annual Report (page  [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559) onwards).  • ‘Restrictive policies’  section in Part 2 of the  Annual Report (page  [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720)),  • ‘Our approach to  nature and  biodiversity’ section in  Part 2 of the Annual  Report (page [124](#i4be61753b7f243b19551b0bfbf3a2a0d_391)). |
|  |  |  |
| Climate Risk Policy | The Climate Risk Policy outlines the requirements and policy  objectives for assessing and managing the impact on Financial and  Operational Risks arising from the physical and transition risks  associated with climate change. This incorporates identification,  measurement, management and reporting for Financial and  Operational Risks. Risks associated with Climate Change are being  managed in accordance with the requirements set out in this policy. | • See our Climate risk  section from page  [272](#i4be61753b7f243b19551b0bfbf3a2a0d_655)  in Risk Review in  Part 3 of the Annual  Report. |
|  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 41 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-financial and sustainability information statement (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Human rights-related statements | | |
| Statement or policy position | Description | Information to help  understand our Group and  its impact, policies, due  diligence and outcomes |
|  |  |  |
| Human rights | Barclays' human rights statement expresses our commitment to  respecting human rights as defined in the International Bill of Human  Rights and the International Labour Organisation’s Declaration on  Fundamental Principles and Rights at Work. Our approach to  respecting human rights is guided by the UN Guiding Principles on  Business and Human Rights and the OECD Guidelines for  Multinational Enterprises on Responsible Business Conduct. The  statement provides an overview of the evolving framework of policies  and processes that seek to embed these commitments across our  business. | See our:  • ‘Managing impacts in  lending and financing’  section in Part 3 of the  Annual Report (page  [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559) onwards).  • Other Governance  within the  Governance report in  Part 3 of the Annual  Report (Page 230). |
|  |  |  |
| Modern slavery | Barclays publishes a Modern Slavery Statement made according to  the requirements of section 54 of the UK Modern Slavery Act 2015  and section 14 of the Australian Modern Slavery Act 2018 (Cth). We  recognise that the nature of our business and global footprint means  we may be exposed to modern slavery risks across our operations,  supply chain, and customer and client relationships. We are  committed to trying to identify and seeking to address human rights  risks, such as modern slavery, across our value chain. In this  Statement we report the progress made over the course of the year  and outline our plans for the year ahead. | See our:  • ‘Managing impacts in  lending and financing’  section in Part 3 of the  Annual Report (page  [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559) onwards).  • Other Governance  within the  Governance report in  Part 3 of the Annual  Report (Page 230). |
|  |  |  |
| Defence and  Security sector | Barclays' Statement on the Defence and Security Sector outlines our  approach to defence-related transactions and relationships. We  recognise that various types of defence equipment are considered  necessary for achieving internationally accepted goals, such as  legitimate national defence and security purposes as set forth in the  Charter of the United Nations, or peacekeeping missions. At the  same time, we also recognise that the Defence and Security Sector  involves equipment and activities that have the potential to lead to  significant impacts on individuals, communities and the broader  geopolitical landscape. Barclays conducts enhanced due diligence as  appropriate on clients in scope of the Defence and Security  Statement. | See our:  • ‘Managing impacts in  lending and financing’  section in Part 3 of the  Annual Report (page  [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559) onwards).  • ‘Restrictive policies’  section in Part 2 of the  Annual Report (page  [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720)). |
|  |  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Colleagues and suppliers | | |
| Statement or policy position | Description | Information to help  understand our Group and  its impact, policies, due  diligence and outcomes |
|  |  |  |
| Code of Conduct | The Barclays Way is our code of conduct which outlines the Purpose,  Values and Mindset that govern our way of working across our  business globally. It constitutes a reference point covering all aspects  of colleagues’ working relationships, and provides guidance on  working with colleagues, customers and clients, governments and  regulators, business partners, suppliers, competitors and the broader  community with the aim of creating the best possible working  environment for our colleagues. | • See The Barclays Way  section from page  [245](#i4be61753b7f243b19551b0bfbf3a2a0d_12486) in Other  Governance within  the Governance  report in Part 3 of the  Annual Report. |
|  |  |  |
| Board Diversity and  Inclusion Policy | The Board Diversity and Inclusion Policy is designed to ensure that all  Board appointments and succession plans are based on merit and  objective criteria, recognising the benefits of diversity, in all its forms,  and that due regard is given to diversity and inclusion characteristics  when considering Board Committee appointments. The Policy sets  out measurable objectives for achieving diversity on the Board,  including the Board's current target to ensure that, by 2025, the  proportion of women on the Board is at least 40 per cent. | • See our section on  diversity within the  report of the Board  Nominations  Committee on page  158 of Part 3 of the  Annual Report. |
|  |  |  |
| Third-party code of  conduct | Our approach to the way we do business needs to be adopted by our  suppliers when acting on behalf of Barclays. To ensure a common  understanding of our approach which will help us collectively drive the  highest standards of conduct, we have created our Third Party Code  of Conduct, which details our expectations for Environmental  Management, Human Rights, Diversity and Inclusion; and living the  Barclays Values. | • See “Supporting our  Supply Chain” within  ESG Governance on  page [238](#i4be61753b7f243b19551b0bfbf3a2a0d_172). |
|  |  |  |
| Statement of  Commitment to  Health & Safety | Barclays health, safety and wellbeing statement of commitment sets  out the Bank’s commitment to protecting the safety and wellbeing of  our employees, customers, suppliers, and any individuals using our  premises, by providing and maintaining a safe working environment  that protects both physical and mental wellbeing. The effective  implementation of the statement of commitment has resulted in the  continual improvement of health and safety related performance and  proactive hazard management, as well as increasing the number of  sites where Barclay’s occupational health and safety management  system is independently certified to ISO45001. | • See our health and  safety section from  page  [250](#i4be61753b7f243b19551b0bfbf3a2a0d_574) in Other  Governance within  the Governance  report in Part 3 of the  Annual Report. |
|  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 42 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-financial and sustainability information statement (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Governance and Financial Crime statements | | |
| Statement or policy position | Description | Information to help understand  our Group and its impact,  policies, due diligence and  outcomes |
|  |  |  |
| Financial Crime  Statement | We have adopted a holistic approach to financial crime risk  management and have one group-wide Financial Crime Policy. It  is designed to ensure that Barclays has adequate systems,  procedures, and controls in place to manage the risk of being  used to facilitate financial crime and to manage the legal,  regulatory, and reputational risks associated with financial crime.  The Financial Crime Policy is supported by group-wide Standards  that focus on four key risks anti-bribery & corruption (ABC); anti-  money laundering & counter-terrorist financing (AML); anti-tax  evasion facilitation (ATEF) and sanctions, including proliferation  financing, and is:  •    Designed to ensure that all employees and Barclays  businesses globally comply with UK, extra-territorial and  locally applicable legal and regulatory obligations,  •    Designed to create an integrated and consistent framework  upon which Barclays manages financial crime risk,  •    Supported by the Barclays Board of Directors,  •    Approved by the Group Chief Compliance Officer (member of  the Group Executive Committee), and  •    Regularly reviewed to ensure it remains up to date. | • See the Financial Crime  section from page  [249](#i4be61753b7f243b19551b0bfbf3a2a0d_571) in  Other Governance within  the Governance report in  Part 3 of the Annual  Report. |
|  |  |  |
| Data protection | Barclays aims to ensure that the privacy and security of personal  information is respected and protected. Our privacy notices,  available on our websites, describe how we collect, handle, store,  share, use and dispose of information about people. We regard  sound privacy practices as a key element of corporate  governance and accountability. | • See the managing data  privacy, security and  resilience section from  page [251](#i4be61753b7f243b19551b0bfbf3a2a0d_577) in Other  Governance within the  Governance report in Part  3 of the Annual Report. |
|  |  |  |
| Donations | Barclays carefully evaluates non-profit organisations prior to  partnering with them to ensure they align with its values. Barclays  will not make any donation that is, or could be perceived to be, an  incentive to win or retain business or one that delivers a business  advantage. We will not make any donation that is contrary to  Barclays Financial Crime Policy (Anti-Bribery & Anti-Corruption  Policy, Sanctions), or any other Barclays Compliance policies and  standards. Barclays is unfortunately unable to provide funding to  many of the requests that we receive and does not accept  unsolicited donation requests. | • See our donation  guidelines at:  [home.barclays/content/](www.home.barclays/content/dam/home-barclays/documents/citizenship/our-reporting-and-policy-positions/Barclays-donation-guidelines.pdf)  [dam/home-barclays/](www.home.barclays/content/dam/home-barclays/documents/citizenship/our-reporting-and-policy-positions/Barclays-donation-guidelines.pdf)  [documents/citizenship/](www.home.barclays/content/dam/home-barclays/documents/citizenship/our-reporting-and-policy-positions/Barclays-donation-guidelines.pdf)  [our-reporting-and-policy-](www.home.barclays/content/dam/home-barclays/documents/citizenship/our-reporting-and-policy-positions/Barclays-donation-guidelines.pdf)  [positions/Barclays-](www.home.barclays/content/dam/home-barclays/documents/citizenship/our-reporting-and-policy-positions/Barclays-donation-guidelines.pdf)  [donation-guidelines.pdf](www.home.barclays/content/dam/home-barclays/documents/citizenship/our-reporting-and-policy-positions/Barclays-donation-guidelines.pdf) |
|  |  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Governance and Financial Crime statements | | |
| Statement or policy position | Description | Information to help understand  our Group and its impact,  policies, due diligence and  outcomes |
| Resilience | Barclays maintains a robust resilience framework focusing on the  end-to-end resilience of the business services we provide to  customers and clients, aiming to ensure that all service  components can deliver during business disruptions, crises,  adverse events and other types of threats. | • See the managing data  privacy, security and  resilience section from  page [251](#i4be61753b7f243b19551b0bfbf3a2a0d_577) in Other  Governance within the  Governance report in Part  3 of the Annual Report. |
|  |  |  |
| Tax | Our Tax Principles are central to our approach to tax planning,  for ourselves or on behalf of our clients. We believe our Tax  Principles have been a strong addition to the way we manage tax,  ensuring that we take into account all of our stakeholders when  making decisions related to our tax affairs. The same applies to  our Tax Code of Conduct which is designed to ensure we file our  returns on time and pay the correct amount of tax in a  responsible and transparent manner. | • See the tax section from  page [247](#i4be61753b7f243b19551b0bfbf3a2a0d_568) in Other  Governance within the  Governance report.  • Barclays PLC Country  Snapshot report at  [home.barclays/](www.home.barclays/annualreport)  [annualreport](www.home.barclays/annualreport) |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 43 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-financial and sustainability information statement (continued) | | | | | | | | | | |

Part 2

Relevant information in relation to the climate-related financial disclosures is set out below, using cross-

referencing to other sections of the Annual Report where appropriate.

Given the similarities in these disclosure requirements with the TCFD recommended disclosures, and in

order to avoid unnecessary duplication and deliver concise reporting, we have chosen to present the

climate-related financial disclosures alongside information relating to the related TCFD recommended

disclosures.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Climate-related financial disclosures index | | | | | |
| CA 2006 requirement | Detail | TCFD Section | Recommendation | Summary | Page references within  Parts 2 and 3 of the  Annual Report |
| Section  414CB(2A)(a) | A description of the company’s  governance arrangements in  relation to assessing and managing  climate-related risks and  opportunities | Governance | a) We describe the Board's oversight of  climate-related risks and opportunities | The Board is responsible for the overall leadership of Barclays PLC, including setting the  Group's climate strategy. The Board and, as appropriate, its Committees are  responsible for the oversight of climate-related risks and opportunities in the Group.  Each Board Committee has its own Committee Terms of Reference clearly setting out  its remit and decision-making powers, including those relating to climate matters. | [154](#i4be61753b7f243b19551b0bfbf3a2a0d_7146825599557), [180](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686051773)  - [182](#if0c56d47f1c7452086332c93b65ba077_5-1-1-1-2448881)  [232](#i4be61753b7f243b19551b0bfbf3a2a0d_8981) |
| b) We describe management's role in  assessing and managing climate-related  risks and opportunities | Oversight and management of Barclays' climate strategy is increasingly embedded in  business-as-usual management structures, including a number of executive  committees.  The executive management committees receive regular briefings on matters including  climate change. Both risks and opportunities are considered by management. Climate-  related risks are assessed and escalated as appropriate through the various risk forums.  In 2023, the Group Sustainability Committee was established as a dedicated forum to  identify and discuss climate-related matters across the Group with a specific mandate  to review and propose updates to the Group Climate strategy prior to approval by  Group ExCo. | [121](#i4be61753b7f243b19551b0bfbf3a2a0d_382) - 123, [233](#i4be61753b7f243b19551b0bfbf3a2a0d_8416) -  [235](#i42bbef0077154fcfbc54941602f293b4_2723) |
|  |  |  |  |  |  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 44 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-financial and sustainability information statement (continued) | | | | | | | | | | |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Climate-related financial disclosures index | | | | | |
| CA 2006 requirement | Detail | TCFD Section | Recommendation | Summary | Page references within  Parts 2 and 3 of the  Annual Report |
| Section  414CB(2A)(d) | A description of:  (i)  the principal climate-related risks  and opportunities arising in  connection with the company’s  operations, and  (ii)  the time periods by reference to  which those risks and  opportunities are assessed | Strategy | a) We describe the climate-related risks  and opportunities the organisation has  identified over the short, medium and long  term | Climate risk is defined as the impact on Financial (Credit, Market, Treasury & Capital)  and Operational Risks arising from climate change through physical risks and risks  associated with transitioning to a lower carbon economy. Barclays faces exposure to  climate-related risks, either directly through its operations and infrastructure or  indirectly through its financing and investment activities. Time horizons are considered  based on Barclays' planning cycles.  Barclays has enhanced its focus on sustainable finance over the last two years. At the  end of 2022, we announced a new target to facilitate $1trn of Sustainable and  Transition Finance. This followed a review of the financing requirements arising from  the global transition to a low-carbon economy if the world is to avoid the worst effects  of climate change and the potential addressable market for Barclays. During 2023 we  built on this work to develop a Group-wide sustainable finance strategy to  operationalise our ambition. | [67](#i4be61753b7f243b19551b0bfbf3a2a0d_253) – [71](#i4be61753b7f243b19551b0bfbf3a2a0d_16224), [272](#i4be61753b7f243b19551b0bfbf3a2a0d_655) ,  [284](#i4be61753b7f243b19551b0bfbf3a2a0d_697)  –  [290](#i18678c9c7dcc49f0b2987fcd1b78ae3e_61535) |
| Section  414CB(2A)(e) | A description of the actual and  potential impacts of the principal  climate-related risks and  opportunities on the company’s  business model and strategy | b) We describe the impact of climate-  related risks and opportunities on the  organisation's businesses, strategy and  financial planning | Barclays’ 2023 financial planning process included a review of our strategy, its  implementation and tracking our progress on climate related targets, as well as,  capturing a view of climate-related risks and opportunities, which aligns with how we  manage other risks.  Our planning process also considered current climate policies to ensure they are  included in the base scenario.  The planning process included an assessment of our financed emissions reduction  targets for some of our highest emitting sectors.  We also considered impairment over the horizon of the financial plan. At this point in  time, there are no material amendments required to the financial plan.  Our Sustainable and Transition Financing target of $1tn is a key driver of our finance  planning process with pathway to achieve this as well as risks and opportunities  reviewed and agreed with business heads. | [72](#i4be61753b7f243b19551b0bfbf3a2a0d_259) – [129](#i68252ec5b05040fd97d5fe92518900f5_34443) |
| Section  414CB(2A)(f) | An analysis of the resilience of the  company’s business model and  strategy, taking into consideration  different climate-related scenarios | c) We describe the resilience of the  organisation's strategy, taking into  consideration different climate-related  scenarios, including a 2o C or lower scenario | Barclays has performed two group wide climate stress tests during 2023, over and  above existing macroeconomic internal stress tests, to assess Barclays’ financial  resiliency to climate risks.  The two scenarios include both physical and transition risks, including assessment of a  tipping point (H1) as well as the knock on macroeconomic impacts (H2).  Results from the exercises have been integrated into Barclays internal capital adequacy  assessment process to ensure Barclays remains sufficiently capitalised to both climate  and macroeconomic stresses.  The outputs are considered within Climate Risk Management and Financial Planning  processes, such as assessment of climate impacts to ECL. | [131](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061446) - [136](#i4be61753b7f243b19551b0bfbf3a2a0d_16064) |
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| Non-financial and sustainability information statement (continued) | | | | | | | | | | |

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| Climate-related financial disclosures index | | | | | |
| CA 2006 requirement | Detail | TCFD Section | Recommendation | Summary | Page references within  Parts 2 and 3 of the  Annual Report |
| Section  414CB(2A)(b) | A description of how the company  identifies, assesses, and manages  climate-related risks and  opportunities | Risk  management | a) We describe the organisation's  processes for identifying and assessing  climate-related risks | The impact of climate risk drivers are observed in Barclays' portfolio through its  traditional risk categories such as credit risk, market risk, treasury and capital risk ,  operational risk and reputational risk. Barclays continues to develop and enhance  processes for identifying, assessing and managing climate-related risks and drive  integration of climate risk into its business activities and operations. | [67](#i4be61753b7f243b19551b0bfbf3a2a0d_253) – [69](#i4be61753b7f243b19551b0bfbf3a2a0d_18684),  [272](#i4be61753b7f243b19551b0bfbf3a2a0d_655)  –  [276](#i4be61753b7f243b19551b0bfbf3a2a0d_12263) |
| b) We describe the organisation's  processes for managing climate-related  risks |
| Section  414CB(2A)(c) | A description of how processes for  identifying, assessing, and  managing climate-related risks are  integrated into the company’s  overall risk management process | c) We describe how processes for  identifying, assessing and managing  climate-related risks are integrated into  the organisation's overall risk management | Climate Risk is a Principal Risk under Barclays' Enterprise Risk Management Framework.  A Climate Risk Framework, Climate Risk Policy and relevant governance structures  have been developed to foster a systematic and consistent approach for managing  climate risk across the firm. Barclays has also established a climate risk appetite at the  Group-level. |

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 46 |
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| Non-financial and sustainability information statement (continued) | | | | | | | | | | |

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| Climate-related financial disclosures index | | | | | |
| CA 2006 requirement | Detail | TCFD Section | Recommendation | Summary | Page references within  Parts 2 and 3 of the  Annual Report |
| Section  414CB(2A)(h) | A description of the key  performance indicators (KPIs) used  to assess progress against targets  used to manage climate-related  risks and realise climate-related  opportunities and of the  calculations on which those KPIs  are based | Metrics &  Targets | a) Our metrics used to assess climate-  related risks and opportunities in line with  our strategy and risk management  processes | In line with our three-part climate strategy, we have set financed emissions 2030  reduction targets across eight high emitting sectors in our portfolio (with the addition  this year of targets for the Aviation, Agriculture and UK Commercial Real Estate  sectors).  We have also expanded the scope of our UK Housing convergence point this year, as  detailed on page [98](#ica49d58c666f48dc92e80e63ca925587_143792). Each of our 2030 target ranges is developed with reference to a  1.5°C-aligned scenario, such as the IEA Net Zero by 2050 scenario. We have reported  our progress against each of these targets as at December 2023, as detailed on page  [86](#i8ea9282454e043a6be366fef3b9849ce_53345).  We have additionally calculated the financed emissions for the full in-scope balance  sheet as at December 2022. This has enabled us to calculate the coverage of our  reduction targets across our portfolio (including integration of 1.5 degree aligned  scenarios, with ranges for certain sectors) and to assess the extent to which the  business is aligned to a well-below 2 degrees pathway. Our calculations indicate that we  have set reduction targets for 55% of our overall Scope1,2 financed emissions.  We also note our progress against our sustainable and transition financing between  2023 and the end of 2030, our green financing between 2018-2030, and our balance  sheet investment by the end of 2027. | [67](#i4be61753b7f243b19551b0bfbf3a2a0d_253) – [71](#i4be61753b7f243b19551b0bfbf3a2a0d_16224) |
| N/A | N/A | b) Our Scope 1, Scope 2 and Scope 3  operational greenhouse gas (GHG)  emissions and the related risks | We measure our Scope 1, Scope 2 and Scope 3 emissions and report these against our  net zero operations strategy, as set out on pages [73](#i4be61753b7f243b19551b0bfbf3a2a0d_262)-[79](#i4be61753b7f243b19551b0bfbf3a2a0d_18002).  On our financed emissions, we have:  i. Estimated the full in-scope balance sheet financed emissions as at December 2022  using a methodology developed based on the PCAF Standard as set out on pages  [80](#i4be61753b7f243b19551b0bfbf3a2a0d_16736)-[83](#i4be61753b7f243b19551b0bfbf3a2a0d_19986); and  ii. Calculated financed emissions and physical intensities for specific activities as at  December 2023 where we have set 2030 targets which include the integration of  1.5°C aligned scenarios, such as the IEA Net Zero 2050 scenario in our financed  emission targets, and including the upper end of ranges for certain sectors, as set  out on page [89](#i4be61753b7f243b19551b0bfbf3a2a0d_289) | [75](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686060018), [88](#i4be61753b7f243b19551b0bfbf3a2a0d_12116) |
| Section  414CB(2A)(g) | A description of the targets used by  the company to manage climate-  related risks and to realise climate-  related opportunities and of  performance against those targets | c) Our targets used to manage climate-  related risks and opportunities and  performance against targets | Alignment of our client portfolios to the goals and timelines of the Paris Agreement  underpinned by Barclays' BlueTrack™ Methodology. Progress reported against the  following sector targets: Energy, Power, Cement, Steel, Automotive Manufacturing and  UK Housing (where we have set a convergence point). Targets have also been set in  2023 for the first time against the following sectors: UK Commercial Real Estate,  Agriculture, and Aviation.  Progress against our target to facilitate $1 trillion of Sustainable and Transition Finance  between 2023 and the end of 2030. | [75](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686060018), [88](#i4be61753b7f243b19551b0bfbf3a2a0d_12116), [103](#i4be61753b7f243b19551b0bfbf3a2a0d_328) |

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 47 |
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| Non-financial and sustainability information statement (continued) | | | | | | | | | | |

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| Task Force on Climate-  related financial disclosure  statement of compliance |

We have considered our obligations under the UK's

Financial Conduct Authority's Listing Rules and

confirm that we have made disclosures consistent

with the relevant Listing Rules and the Taskforce for

Climate-related Financial Disclosures (TCFD)

Recommendations and Recommended

Disclosures.

Given the similarities between the TCFD

Recommended Disclosures and the new climate-

related financial disclosures (required further to

sections 414CA and 414CB of the Companies Act

2006), and in order to avoid unnecessary duplication

and deliver concise reporting, we have chosen to

present information relating to the TCFD

recommended disclosures alongside the relevant

Companies Act 2006 requirements.

For further information on where these

disclosures can be found please refer to pages

[44](#i4be61753b7f243b19551b0bfbf3a2a0d_16709) to [47](#i55d2e01bf03d4d93979e09d8259dfb9c_14-4-1-1-2511376) of this report.

Looking ahead: TCFD sector specific

requirements for asset managers

We continue our work to implement the TCFD

sector specific guidance for asset managers

(which represents a small part of our overall

business) in accordance with the FCA Enhanced

Climate-Related Disclosure Requirements for

Asset Managers. We will report on this work

during 2024, recognising the industry-wide

challenge with data availability and accuracy to

meet these requirements.

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| + | Further details on the TCFD Recommendations and  Recommended Disclosures are available at :  [fsb-tcfd.org](https://www.fsb-tcfd.org/)  Full list of metrics and targets can be found in the ESG Data  Centre at:  [home.barclays/sustainability/esg-resource-hub/](http://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [reporting-and-disclosures/](http://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/) |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 48 |
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| Task Force on Climate-related financial disclosure statement of compliance | | | | | | | | | | |

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| ESG ratings performance |
| We remain committed to enhancing our disclosures and  to engaging with industry-led initiatives intended to  support an effective and trusted ESG ratings market. |

In 2023, Barclays continued engaging with key

ESG ratings agencies to provide clear and

consistent disclosures to our stakeholders.

Five of the ratings we track were unchanged, two

declined, and three improved.

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The ESG ratings market is moving towards a

more regulated environment in the EU. Here in

the UK, an industry-led working group launched a

Code of Conduct for ESG ratings and data

product providers. Barclays supports the Code's

principles of transparency, good governance,

management of conflicts of interest, and robust

controls.

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| + | Please also refer to page  [144](#i4be61753b7f243b19551b0bfbf3a2a0d_448)  in  [Part 3 of the Annual Report](#i4be61753b7f243b19551b0bfbf3a2a0d_430)  for  details of BPLC Board consideration of matters relating to  the reporting and monitoring of ESG-related data in addition  to how we manage Climate across our Board structures  within the Other Governance section from page  [230](#i4be61753b7f243b19551b0bfbf3a2a0d_550)  in  [Part 3](#i4be61753b7f243b19551b0bfbf3a2a0d_430)  [of the Annual Report](#i4be61753b7f243b19551b0bfbf3a2a0d_430). |
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|  | Select ESG ratings and benchmarks | | | | |  |  |
|  | MSCI ESG Rating | | |  | ISS QualityScore Environment | |  |
|  | AA  2022: AA  2021: AA | | Scale (best to worst): |  | 1  2022: 1  2021: 1 | Scale (best to worst): |  |
|  | AAA to CCC |  | 1 to 10 |  |
|  | Barclays’ rating was stable |  | Barclays’ rating was stable |  |
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|  | Sustainalytics ESG Risk Rating | | |  | ISS QualityScore Social | |  |
|  | 23.8  2022: 23.8  2021: 25.1 | | Scale (best to worst): |  | 1  2022: 1  2021: 1 | Scale (best to worst): |  |
|  | 0-100 |  | 1 to 10 |  |
|  | Barclays’ rating was stable |  | Barclays’ rating was stable |  |
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|  | S&P Global CSA | | |  | ISS QualityScore Governance | |  |
|  | 59  (90th  percentile)  2022: 75  (95 th percentile)  2021: 78  (92nd percentile) | | Scale (best to worst): |  | 4  2022: 9  2021: 7 | Scale (best to worst): |  |
|  | 100 to 0 |  | 1 to 10 |  |
|  | Barclays’ rating and relative  performance declined |  | Barclays' rating improved |  |
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|  | CDP Climate Change | | |  | ISS ESG Corporate Score | |  |
|  | B  2022: A-  2021: B | | Scale (best to worst): |  | C  2022: C-  2021: C- | Scale (best to worst): |  |
|  | A to D- |  | A+ to D |  |
|  | Barclays' rating declined |  | Barclays’ rating improved |  |
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|  |  | FTSE Russell ESG Rating | |  | Moody’s ESG Solutions | |  |
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|  |  | 4.7  (99 th  percentile)  2022: 4.7  (98th percentile)  2021: 4.2  (92nd percentile) | Scale (best to worst): |  | 62  2022: 55  2021: 55 | Scale (best to worst): |  |
|  |  | 5 to 0 |  | 100 to 0 with advanced (>60) |  |
|  |  | Barclays’ rating was stable and relative  performance improved slightly |  | Barclays’ rating improved |  |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 49 |
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| ESG Ratings and Benchmarks | | | | | | | | | | |

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| ESG-related reporting  and disclosures |  | Our approach to ESG reporting is informed by  recognised external standards and frameworks. As  these frameworks evolve, we will continue to assess and  amend our approach to ESG disclosures appropriately. |

Barclays continues to support efforts for

enhanced ESG reporting and advocates for

consistency in approaches to disclosures, ratings

and benchmarks, including the work of the

International Sustainability Standards Board

(ISSB). We participate in a range of regional and

global industry efforts to promote increased

harmonisation in approaches to data,

taxonomies and disclosures.

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|  | ESG Resource Hub | |  |
|  | Barclays' ESG Resource Hub provides more  detailed technical information, disclosures  and our position statements on  environmental, social and governance  matters. It is intended to be relevant for  analysts, ESG investors, rating agencies,  suppliers, clients and all other stakeholders. | |  |
|  | + | Further details can be found on the ESG Resource Hub  at:  [home.barclays/sustainability/esg-resource-hub/](https://home.barclays/sustainability/esg-resource-hub/) |  |
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UN Principles for Responsible

Banking (PRB)

Barclays was one of the founding signatories of

the UN PRB. We report annually on how we are

implementing the Principles.

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| + | The Barclays PLC PRB Report 2023 can be found at:  [home.barclays/sustainability/esg-resource-hub/reporting-](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/) |
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TCFD-related reporting and

disclosures

Our climate-related financial disclosures are

included within this Annual Report. The majority

of the content can be found in Part 2 within the

Climate and Sustainability report in addition to

Part 3 within the Governance report and Risk

review sections of the report.

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| + | For further details on where to access our TCFD-related  disclosures, please see our Climate-related Financial  Disclosures Summary and Index on page [44](#i4be61753b7f243b19551b0bfbf3a2a0d_16709). |
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ESG Additional Reporting Disclosures

Barclays provides additional disclosures within

the ESG Resource Hub, including reporting with

reference to the material topics from the

Sustainability Accounting Standards Board

(SASB) and the Global Reporting Initiative (GRI).

ESG Data Centre

Within the ESG Resource Hub, our ESG Data

Centre continues to provide a central repository

of climate, sustainability, and ESG-related data

that is published within the Barclays PLC Annual

Report in addition to additional data points and

granularity.

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| --- | --- |
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| + | The ESG Data Centre can be accessed online within our  ESG Resource Hub at:   [home.barclays/sustainability/esg-](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [resource-hub/reporting-and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/) |
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KPMG LLP Limited Assurance

Barclays appointed KPMG LLP to perform limited

independent assurance over selected ESG

content, marked with the symbol Δ.

The assurance engagement was planned and

performed in accordance with the International

Standard on Assurance Engagements (UK) 3000

Assurance Engagements Other Than Audits or

Reviews of Historical Financial Information and

the International Standard on Assurance

Engagements 3410 Assurance of Greenhouse

Gas Statements. A limited assurance opinion was

issued and is available at the website link below.

This includes details of the scope, reporting

criteria, respective responsibilities, work

performed, limitations and conclusion. No other

information in this Annual Report has been

subject to this external limited assurance.

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| + | Further details on Limited Assurance can be found at:  [home.barclays/sustainability/esg-resource-hub/reporting-](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/) |
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|  | Our ESG-related disclosures: | | | | | |  |
|  | Annual Report | ESG-related  reporting | ESG data  resources | Other ESG  resources | Statements  and policy positions | Indices |  |
|  | • Taskforce for Climate-related  Financial Disclosures (TCFD)  Recommendations  • ESG-related disclosures | • Principles for Responsible Banking  (PRB) Report  • Fair Pay report / UK Pay Gaps report  • (Tax) Country Snapshot report  • Board Diversity Policy  • Diversity, Equity and Inclusion report | • ESG Data Centre | • ESG Investor Presentations  • Limited Independent  Assurance statement  • Barclays' Sustainable  Finance Framework  • Barclays' Transition  Finance Framework  • BlueTrack TM  Whitepaper  • Corporate Transition Forecast Model | • ESG Resource Hub - Statements  and policy positions | • Global Reporting Index (GRI)  • Sustainability Accounting Standards  Board (SASB) |  |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 50 |
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| ESG-related reporting and disclosures | | | | | | | | | | |

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| Prudently managing risk  for stakeholders |  | Barclays is exposed to internal and external risks as part  of its ongoing activities. These risks are managed as  part of our business model. |

Enterprise Risk Management

Framework (ERMF)

At Barclays, risks are identified and overseen in

accordance with the ERMF, which supports the

business in its aim to embed effective risk

management and a strong risk management

culture.

The ERMF governs the way in which Barclays

identifies and manages its risks.

The management of risk is then embedded into

each level of the business, with all colleagues being

responsible for identifying and controlling risk.

In 2023, the Conduct Risk Principal Risk was

renamed "Compliance Risk" and now

incorporates Conduct Risk as well as risks from a

failure to comply with laws, rules and regulations

applicable to the firm.

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| “The ERMF governs the way in which Barclays  identifies and manages its risks.” |

Risk appetite

Risk appetite defines the level of risk we are

prepared to accept across the different risk

types, taking into consideration varying levels of

financial and operational stress. Risk appetite is

key to our decision-making processes, including

ongoing business planning and setting of

strategy, new product approvals and business

change initiatives.

The Group sets its risk appetite in terms of

performance metrics as well as a set of mandate

and scale limits to monitor risks (i.e. to ensure

business activities are aligned with expectations

and are of an appropriate scale relative to the risk

and reward of the underlying activities). During

2023, the Group’s performance remained within

its risk appetite limits.

Three lines of defence

The first line of defence is comprised of the

revenue-generating and client-facing areas,

along with all associated support functions,

including Finance, Treasury, Human Resources

and Operations and Technology. The first line

identifies the risks, sets the controls and

escalates risk events to the second line of

defence. Employees in the first line have primary

responsibility for their risks and their activities are

subject to oversight from the relevant parts of

the second and third lines.

The second line of defence is made up of Risk

and Compliance and oversees the first line by

setting limits, rules and constraints on their

operations, consistent with the risk appetite. The

third line of defence is comprised of Internal

Audit, providing independent assurance to the

Board and Executive Committee on the

effectiveness of governance, risk management

and control over current, systemic and evolving

risks.

The Legal function provides support to all areas

of the business and is not formally part of any of

the three lines of defence, The Legal function is

responsible for proactively identifying,

communicating and providing legal advice on

applicable laws, rules and regulations. Except in

relation to the legal advice it provides or

procures, it is subject to second line oversight

with respect to its own operational and

compliance risks, as well as with respect to the

legal risks to which the Group is exposed.

Monitoring the risk profile

Together with a strong governance process,

using business and Group-level Risk Committees

as well as Board-level forums, the Board receives

regular information in respect of the risk profile of

the Group, and has ultimate responsibility for

Group risk appetite and capital plans. Information

received includes measures of risk profile against

risk appetite as well as the identification of new

and emerging risks, which are derived by

mapping risk drivers, identified through horizon

scanning, to risk themes, and similar analysis.

During 2023, Barclays ran a stress test to assess

its capital adequacy and resilience under a severe

but plausible macroeconomic scenario. This

stress test targeted risks such as inflation,

financial stress and a shock on demand; with

terminal low rates set to test the Group's

vulnerabilities through Net Interest Income (NII)

margin compression. The stress test outcome

for macroeconomic tests assesses our full

financial performance over the horizon of the

scenario in terms of profitability, capital, liquidity

and leverage to ensure the Group remains viable.

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| + | For further details of the stress test,  please refer to page [55](#i6127f61949ef438ca49641294c729b45_27778). |
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We believe that our structure and governance

supports us in managing risk in the changing

economic, political and market environments.

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| --- | --- |
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| + | For further detailed analysis of approach to risk  management and risk performance, please see our full Risk  review on pages [254](#i4be61753b7f243b19551b0bfbf3a2a0d_580) to [372](#i7d14e033e5b94859948b1dda818e15c5_653668) of Part 3 of the Annual Report |
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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 51 |
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| Managing risk | | | | | | | | | | |

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| --- | --- | --- |
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| The Enterprise Risk Management Framework defines nine Principal Risks | | |
| Principal Risks | Risks are classified into Principal Risks, as below | How risks are managed |
|  |  |  |
| Credit risk | The risk of loss to the Group from the failure of clients, customers or counterparties  (including sovereigns), to fully honour their obligations to the Group, including the whole  and timely payment of principal, interest, collateral and other receivables. | Credit Risk teams identify, evaluate, sanction, limit and monitor various forms of credit exposure, individually and  in aggregate. The First Line delivers business plans and products within risk appetite and all limits set by the  Second Line, by maintaining detailed financial forecasts, applying controls and managing risks to which they are  exposed. |
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| Market risk | The risk of loss arising from potential adverse changes in the value of the Group’s assets  and liabilities from fluctuation in market variables including, but not limited to, interest rates,  foreign exchange, equity prices, commodity prices, credit spreads, implied volatilities and  asset correlations. | Market Risk teams use a range of complementary approaches to identify and evaluate traded market risk  exposures. These risks are measured, limited and monitored by market risk specialists. The First Line conduct  trading activities within the risk appetite and all mandate & scale limits set by the Second Line. |
|  |  |  |
| Treasury and  Capital risk | Liquidity risk  The risk that the Group is unable to meet its contractual or contingent obligations or that it  does not have the appropriate amount, tenor and composition of funding and liquidity to  support its assets. | Treasury and Capital risk is identified and managed by specialists in capital, liquidity and asset and liability  management teams. A range of risk management approaches are used such as limits plan monitoring and stress  testing. |
| Capital risk  The risk that the Group has an insufficient level or composition of capital to support its  normal business activities and to meet its regulatory capital requirements under normal  operating environments and stressed conditions (both actual and as defined for internal  planning or regulatory testing purposes). This also includes the risk from the Group’s  pension plans. |
| Interest rate risk in the banking book  The risk that the Group is exposed to capital or income volatility because of a mismatch  between the interest rate exposures of its (non-traded) assets and liabilities. |
|  |  |  |
| Climate risk | The impact on Financial and Operational risks arising from climate change through physical  risks, risks associated with transitioning to a low-carbon economy and connected risks  arising as a result of second order impacts on portfolios of these two drivers.1 | The Group assesses and manages its climate risk across its businesses and functions in line with its net zero  ambition by monitoring exposure to elevated risk sectors, conducting scenario analysis and risk assessments for  key portfolios. The First Line delivers business plans and manages exposures within the climate risk appetite and  limits set by the Second Line. Climate risk controls are embedded across the financial and operational principal  risk types through the Barclays Group's frameworks, policies and standards. |
| Note:  1 Definition of climate risk amended as part of the update climate risk policy in 2023. See page 67 for further detail. | | |

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 52 |
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| Managing risk (continued) | | | | | | | | | | |

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| --- | --- | --- |
|  |  |  |
| The Enterprise Risk Management Framework defines nine Principal Risks | | |
| Principal Risks | Risks are classified into Principal Risks, as below | How risks are managed |
|  |  |  |
| Operational risk | The risk of loss to the Group from inadequate or failed processes or systems, human  factors or due to external events (for example, fraud) where the root cause is not due to  credit or market risks. | Operational risks are managed in accordance with the Operational Risk Framework, owned and overseen by the  Second Line, and the standards within the Barclays Control Framework. The primary responsibility for the  management of operational risk rests within the business and functional units where the risk arises. Management  complete Risk and Control Self-Assessments to assess operational risks and the effectiveness of the controls  within processes. Identified risks, events and issues are escalated to senior management and the Board to  ensure timely notification and to agree the appropriate response. |
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| Model risk | The potential for adverse consequences from decisions based on incorrect or misused  model outputs and reports. | The range of controls owned by First Line include: timely model identification, robust model development,  testing, documentation, annual assessment, and ongoing performance monitoring. The range of controls owned  by Second Line include: independent model validation, oversight over on-going model performance, and  execution of overall model risk governance covering oversight and reporting and escalation to appropriate  forums and committees. |
|  |  |  |
| Compliance risk | The risk of poor outcomes for, or harm to, customers, clients and markets, arising from the  delivery of the Group’s products and services (also known as 'Conduct risk') and the risk to  Barclays, its clients, customers or markets from a failure to comply with the laws, rules and  regulations applicable to the Group (also known as Laws, Rules and Regulations Risk, 'LRR  Risk'). | The First Line are accountable for the overall assessment and management of compliance risks in their business  or function and are responsible for implementing the requirements outlined in the Compliance Risk Management  Framework (CRMF).  Compliance must oversee adherence to the CRMF and the management of compliance risk, and provide  independent Second Line of Defence oversight to all Barclays businesses, providing advice and challenge where  appropriate. |
|  |  |  |
| Reputation risk | The risk that an action, transaction, investment, event, decision, or business relationship  will reduce trust in the Group’s integrity and/or competence. | Reputation risk is managed by embedding our Purpose and Values, and maintaining a controlled culture within the  Group, with the objective of acting with integrity, enabling strong and trusted relationships to be built with  customers and clients, colleagues and broader society. Each business assesses reputation risk using  standardised tools and the governance is fulfilled through management committees and forums, clear escalation  and reporting lines to the Group Board. |
|  |  |  |
| Legal risk | The risk of loss or imposition of penalties, damages or fines from the failure of the Group to  meet applicable laws, rules and regulations or contractual requirements or to assert or  defend its intellectual property rights. | Legal risk is managed by the identification and management of legal risks by the legal function and the escalation  of legal risk as necessary. The Group’s businesses and functions have responsibility for engagement of the Legal  function in situations that have the potential for legal risk, |

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 53 |
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| Managing risk (continued) | | | | | | | | | | |

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| Consideration  of the long-term viability  of Barclays |  | The financial statements and accounts  have been prepared on a going concern basis. |

Provision 31 of the 2018 UK Corporate

Governance Code requires the Directors to

make a statement in the Annual Report regarding

the viability of the Group, including an explanation

of how they assessed the prospects of the

Group, the period of time for which they have

made the assessment and why they consider

that period to be appropriate.

Time horizon

In light of the analysis summarised below, the

Board has assessed the Group’s current viability,

and confirms that the Directors have a

reasonable expectation that the Group will be

able to continue in operation and meet its

liabilities as they fall due over the next three

years. This time frame is used in management’s

Working Capital and Viability Report (WCR),

prepared at the start of February 2024. The WCR

is a formal projection of capital and liquidity based

upon formal profitability forecasts. The

availability of the WCR gives management and

the Board sufficient visibility and confidence on

the future operating environment for this time

period.

The three-year time frame has also been chosen

because:

▪ it is within the period covered by the formal

medium-term plans approved by the Board

which contain projections of profitability, cash

flows, capital requirements and capital

resources

▪ it is also within the period over which internal

stress testing is carried out

▪ it is an appropriate horizon over which to

consider the impacts of new regulations in the

financial services industry.

The Directors are satisfied that this period is

sufficient to enable a reasonable assessment of

viability to be made.

Considerations

In making its assessment the Board has:

▪ carried out a robust and detailed assessment

of the Group’s risk profile and material existing

and emerging risks (see below for further

details), in particular those risks which senior

management believes could cause the

Group’s future results of operations or

financial condition to differ materially from

current expectations or could adversely

impact the Group’s ability to meet its material

regulatory requirements

▪ reviewed how those risks are identified,

managed and controlled (further detail

provided on pages [51](#i4be61753b7f243b19551b0bfbf3a2a0d_11690) to [53](#ib469fcf3a9f54c04968fe109fafad382_12-2-1-1-1841111))

▪ considered the WCR which provides an

assessment of forecast CET1, leverage, Tier 1

and total capital ratios, as well as the build-up

of minimum requirement for own funds and

eligible liabilities (MREL) up to the end of 2025

▪ considered the Group’s Medium Term Plan

▪ reviewed the Group’s liquidity and funding

profile, including forecasts of the Group’s

Internal Liquidity Stress Test (ILST), regulatory

Liquidity Coverage Ratios (LCR) and Net

Stable Funding Ratios (NSFR)

▪ considered the Group’s viability under a

specific internal stress scenario (see below for

further detail)

▪ considered the stability of the major markets in

which it operates, supply chain resilience and

material known regulatory changes to be

enacted

▪ considered the sustainability of any future

capital distributions

▪ considered scenarios which might affect the

operational resilience of the Group

▪ considered factors that may inform the impact

of a severe recession in major economies with

affordability pressures on consumers from

high inflation and rising interest rates, energy

supply pressures, and financial markets

instability

▪ considered the impact of the Group’s ambition

to be a net zero bank by 2050 and support its

clients’ transition to a low-carbon economy,

including the need to continue to incorporate

climate considerations into its strategy,

business model, the products and services it

provides to customers and its financial and

non-financial risk management processes

▪ reviewed the draft statutory accounts and the

financial performance of the Group

▪ reviewed the possible impact of legal,

competition and regulatory matters set out in

Note 25 to the financial statements on pages

[470](#if7c8df0237cf4aba88fe5f2fc2b9ac32_36076) to [474](#if7c8df0237cf4aba88fe5f2fc2b9ac32_36073).

The Group's Medium Term Plan is based on

assumptions for macroeconomic variables such

as interest rates, inflation, unemployment, which

have been consistently applied for the purpose

of forecasting the Group’s capital and liquidity

position and ratios, as well as any credit

impairment charges or releases.

Assessment of the Group's risk profile

Risks faced by the Group’s business, including in

respect of financial, conduct and operational

risks, are controlled and managed within the

Group in line with the ERMF. Executive

management sets a risk appetite for the Group,

which is then approved by the Board. Limits are

set to control risk appetite, within which

businesses are required to operate.

Management and the Board then oversee the

ongoing risk profile. Internal Audit provides

independent assurance to the Board and

Executive Committee over the effectiveness of

governance, risk management and control over

current and evolving risks.

A full set of material risks to which the

organisation is exposed can be found in the

material existing and emerging risks on pages

[258](#i2207833d992a41c98da57124d8d2efb7_761) to  [271](#ieed9f272f3364f86baf2084fac980501_5131) .

Certain risks are additionally identified as key

themes and monitored closely by the Board and

Board Committees. These are chosen on the

basis of their potential to impact viability during

the time frame of the assessment but in some

instances the risks may continue beyond this

time frame.

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 54 |
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| Viability statement | | | | | | | | | | |

These particular risks include:

▪ the potential impact of increased recession

risk heightened by the turbulent geopolitical

outlook and volatile market conditions

▪ failure to successfully adapt the Group’s

operations and business strategy to address

the financial risks resulting from both: (i) the

physical risk of climate change; and (ii) the risk

from the transition to a  low-carbon economy

▪ legal proceedings, competition, regulatory and

conduct matters giving rise to the potential

risk of penalties, damages or fines, loss of

regulatory licences and permissions and other

sanctions, as well as potential adverse impacts

on our reputation with clients and customers

and on investor confidence and/or potentially

resulting in adverse impacts on capital, liquidity

and funding

▪ sudden shocks or geopolitical instability in any

of the major economies in which the Group

operates which could alter the behaviour of

depositors and other counterparties, affect

the ability of the firm to maintain appropriate

capital and liquidity ratios or impact the

Group's credit ratings

▪ evolving operational risks (notably cyber

security, technology and resilience) and the

ability to respond to the new and emerging

technologies in a controlled fashion.

As a universal bank with a diversified and

connected portfolio of businesses, servicing

customers and clients globally, the Group is

impacted in the longer term by a wide range of

macroeconomic, political, regulatory and

accounting, technological, social and

environmental developments. The evolving

operating environment presents opportunities

and risks in respect of which the Group continues

to evaluate and take steps to appropriately adapt

its strategy and its delivery.

Stress tests

The Board has also considered the Group’s

viability under a specific internal stress scenario.

The latest macroeconomic internal stress test,

conducted in H2 2023, targets risks such as

inflation, financial stress and a shock on demand;

with terminal low rates set to test Barclays’

vulnerabilities through NII margin compression:

• severe UK recession (GDP low point -4.5%)

brought by falling household real incomes, job

losses leading to 8.3% unemployment rate,

declining economic confidence and tight

financial conditions. Other major economies

experience very similar shocks

• high interest rates (peak 8.5% UK, 8.5% US)

lead to additional stress in banking and non-

banking sectors. As financial conditions

tighten, central banks rapidly reverse policy

and low interest rates persist (1% UK, 1.5%

US) to stimulate the economy and avoid an

even worse outcome

• inflation, after a short-term spike (UK 10.4%,

US 8.1%), begins to reduce towards the end of

2025 gradually falling to 2% in the outer year

forecast horizon. The short-term affordability

pressures on customers ease as interest rates

and inflation falls

• residential house prices in the UK decline 33%

while in the US commercial real estate prices

fall 45%, reflecting the contagion effects from

the financial markets.

The stress test outcome for macroeconomic

tests assesses our full financial performance

over the horizon of the scenario in terms of

profitability, capital, liquidity and leverage to

ensure we remain viable.

In addition to a macroeconomic internal stress

test, a climate internal stress test was run this

year and presented to the Board Risk Committee

for approval. See page [176](#i4be61753b7f243b19551b0bfbf3a2a0d_490). The exercise

confirmed the Bank is financially resilient to

climate risks. Refer to the 'scenario analysis'

section in page [131](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061446) for the key learnings from

the climate internal stress test.

The Group-wide stress testing framework also

includes internal reverse stress testing

assessments, conducted once a year, which aim

to identify the circumstances under which the

Group’s business model would no longer be

viable, leading to a significant change in business

strategy and to the identification of appropriate

mitigating actions. Examples include extreme

macroeconomic downturn (‘severely adverse’)

scenarios, or specific one-off events, covering

both operational risk and capital/liquidity items.

Reverse stress testing is used to help support

ongoing risk management and is an input to the

Group’s recovery planning process.

Legal proceedings, competition, regulatory and

remediation/redress conduct matters are also

assessed as part of the stress testing process.

Capital and the ILST are set at a level designed to

enable the Group to withstand various stress

scenarios. As part of this process, management

also identified actions, including cost reductions

and withdrawal from lines of business, available to

restore the Group to its desired capital flight

path. These internal stress tests informed the

conclusions of the WCR.

The results of the macroeconomic internal

stress test were approved by the Board Risk

Committee and allowed the Board to approve

the Medium Term Plan as being able to sustain a

severe but plausible scenario and remain within

risk appetite.

Based on current forecasts, taking account of

material known regulatory changes to be

enacted and having considered possible stress

scenarios, the current liquidity and capital

position of the Group continues to support the

Board’s assessment of the Group’s viability.

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|  | Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 55 |
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| Viability statement (continued) | | | | | | | | | | |

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|  | Annual General Meeting (AGM) | | |  |
|  |  |  |  |  |
|  | Location  SEC (Scottish Event Campus) Armadillo,  Exhibition Way, Glasgow G3 8YW  And electronically on an online platform  Date  Thursday, 9 May 2024  Time  11.00am  The arrangements for the Company’s 2024 AGM  and details of the resolutions to be proposed,  together with explanatory notes and how to  attend the meeting, will be set out in the Notice  of AGM to be published on the Company’s  website ([home.barclays/agm](https://home.barclays/agm)). |  | BarclaysAR23_AGM_MAP.jpg |  |
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|  | Key dates | | | |  |
|  | 1 March  2024  Full year dividend record date | 3 April  2024  Full year dividend payment date | 25 April  2024  Q1 2024 Results Announcement | 9 May  2024  Annual General Meeting at  11.00am |  |
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Keep your personal

details up to date

Please remember to tell Equiniti if:

• you move; or

• you need to update your bank or building

society details.

If you are a Shareview member, you can update

your bank or building society account or address

details online. If you are not a Shareview member

you can update details quickly and easily over the

telephone using the Equiniti contact details on

the next page.

Dividends

The Barclays PLC 2023 full year dividend for the

year ended 31 December 2023 will be 5.30p per

share, making the 2023 total dividend 8.00p per

share.

Dividend Reinvestment Plan

Barclays offers a share alternative in the form of

a dividend reinvestment plan (DRIP) for those

shareholders who wish to elect to use their

dividend payments to purchase additional

ordinary shares, rather than receive a cash

payment. The DRIP is provided and administered

by Barclays’ registrar, Equiniti.

Share price Information on the Barclays share

price and other share price tools are available at:

[home.barclays/investorrelations](http://home.barclays/investorrelations)

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| --- | --- |
|  |  |
| + | Further details regarding the DRIP can be found at  [home.barclays/dividends](https://home.barclays/dividends)  and shareview.co.uk/info/drip |
|  |

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| Strategic  report |  | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  information |  | Barclays PLC  Annual Report 2023 | 56 |
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| Shareholder information | | | | | | | | | | |

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|  | Shareholder security  Shareholders should be wary of any cold calls  with an offer to buy or sell shares. Fraudsters  use persuasive and high pressure techniques  to lure shareholders into high-risk  investments or scams. You should treat any  unsolicited calls with caution.  Please keep in mind that firms authorised  by the Financial Conduct Authority (FCA)  are unlikely to contact you out of the blue.  You should consider getting independent  financial or professional advice from  someone unconnected to the respective  firm before you hand over any money.  Report a scam  If you suspect that you have been  approached by fraudsters please tell the FCA  using the share fraud reporting form at  [fca.org.uk/scams](http://fca.org.uk/scams) . You can also call the FCA  Helpline on 0800 111 6768 or through Action  Fraud on 0300 123 2040. |  |
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Donations to charity

We launched a Share Dealing Service in October

2017 aimed at shareholders with relatively small

shareholdings for whom it might otherwise be

uneconomical to deal. One option open to

shareholders was to donate their sale proceeds

to ShareGift. As a result of this initiative,

£75,452.72 was donated in 2023, taking the total

donated since 2017 to over £336,200.

Managing your shares online

Shareview

Barclays shareholders can go online to manage

their shareholding and find out about Barclays

performance by joining Shareview. Through

Shareview, you:

• will receive the latest updates from Barclays

direct to your email

• can update your address and bank details online

• can vote in advance of general meetings.

To join Shareview, please follow these two

easy steps:

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| --- | --- |
|  |  |
| Step 1 | Go to [portfolio.shareview.co.uk](http://portfolio.shareview.co.uk) |
| Step 2 | Register for electronic  communications by following the  instructions on screen |

Returning funds to shareholders

Over 60,000 shareholders did not cash their

Shares Not Taken Up (SNTU) cheque following

the Rights Issue in September 2013. In 2023, we

continued the tracing process to reunite these

shareholders with their SNTU monies and any

unclaimed dividends and by the end of the year,

we had returned approximately £32,000 to our

shareholders, in addition to the approximately

£5.0m returned since 2015.

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|  | Useful contact details  Registrar  Holders of ordinary shares  The Barclays share register is maintained by  Equiniti. If you have any questions about your  Barclays shares, please contact Equiniti:  By phone:  + 44 (0)371 384 2055  (UK & International telephone number)  +44 (0)371 384 2255  (for the hearing impaired in the UK  and international)  Note: Lines open 8.30am to 5.30pm (UK time)  Monday to Friday, excluding public holidays.  Visit online:  shareview.co.uk  By post:  Aspect House  Spencer Road, Lancing, West Sussex  BN99 6DA  To find out more, contact Equiniti or visit:  home.barclays/dividends  Alternative formats  Shareholder documents can be provided in  large print, audio CD or Braille free of charge  by calling Equiniti.  +44 (0)371 384 2055  (UK and International telephone number) |  | Holders of American Depositary Receipts  (ADRs)  ADRs represent the ownership of Barclays  PLC shares which are traded on the New York  Stock Exchange. ADRs carry prices, and pay  dividends, in US dollars.  If you have any questions about your Barclays  ADRs, please contact Shareowner Services:  By email:  StockTransfer@equiniti.com  Visit online:  adr.com  By phone:  +1 800 990 1135 (toll free in the US and Canada)  +1 651 453 2128 (outside the US and Canada)  By post:  Shareowner Services,  PO Box 64504, St Paul, MN 55164-0504, USA  Delivery of ADR certificates and overnight mail:  By post:  Shareowner Services,  1110 Centre Point Curve, Suite 101, Mendota  Heights, MN 55120-4100, USA  Qualifying US and Canadian resident ADR  holders should contact Shareowner Services  for further details regarding the DRIP.  Shareholder Relations  If you have any questions for Barclays about  your shareholding, please contact:  By email:  privateshareholderrelations@barclays.com  By post:  Shareholder Relations  Barclays PLC, 1 Churchill Place, London,  E14 5HP |  |
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| Strategic  report |  | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  information |  | Barclays PLC  Annual Report 2023 | 57 |
|  |  |
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| Shareholder information (continued) | | | | | | | | | | |

Forward looking statements

This document contains certain forward-looking

statements within the meaning of Section 21E of

the US Securities Exchange Act of 1934, as

amended, and Section 27A of the US Securities

Act of 1933, as amended, with respect to the

Group. Barclays cautions readers that no

forward-looking statement is a guarantee of

future performance and that actual results or

other financial condition or performance

measures could differ materially from those

contained in the forward-looking statements.

Forward-looking statements can be identified by

the fact that they do not relate only to historical

or current facts. Forward-looking statements

sometimes use words such as ‘may’, ‘will’, ‘seek’,

‘continue’, ‘aim’, ‘anticipate’, ‘target’, ‘projected’,

‘expect’, ‘estimate’, ‘intend’, ‘plan’, ‘goal’, ‘believe’,

‘achieve’ or other words of similar meaning.

Forward-looking statements can be made in

writing but also may be made verbally by

directors, officers and employees of the Group

(including during management presentations) in

connection with this document. Examples of

forward-looking statements include, among

others, statements or guidance regarding or

relating to the Group’s future financial position,

business strategy, income levels, costs, assets

and liabilities, impairment charges, provisions,

capital leverage and other regulatory ratios,

capital distributions (including policy on dividends

and share buybacks), return on tangible equity,

projected levels of growth in banking and financial

markets, industry trends, any commitments and

targets (including environmental, social and

governance (ESG) commitments and targets),

plans and objectives for future operations and

other statements that are not historical or

current facts. By their nature, forward-looking

statements involve risk and uncertainty because

they relate to future events and circumstances.

Forward-looking statements speak only as at the

date on which they are made. Forward-looking

statements may be affected by a number of

factors, including, without limitation: changes in

legislation, regulations, governmental and

regulatory policies, expectations and actions,

voluntary codes of practices and the

interpretation thereof, changes in International

Financial Reporting Standards and other

accounting standards, including practices with

regard to the interpretation and application

thereof and emerging and developing ESG

reporting standards; the outcome of current and

future legal proceedings and regulatory

investigations; the Group’s ability along with

governments and other stakeholders to

measure, manage and mitigate the impacts of

climate change effectively; environmental, social

and geopolitical risks and incidents, pandemics

and similar events beyond the Group’s control;

the impact of competition in the banking and

financial services industry; capital, liquidity,

leverage and other regulatory rules and

requirements applicable to past, current and

future periods; UK, US, Eurozone and global

macroeconomic and business conditions,

including inflation; volatility in credit and capital

markets; market related risks such as changes in

interest rates and foreign exchange rates;

reforms to benchmark interest rates and indices;

higher or lower asset valuations; changes in

credit ratings of any entity within the Group or

any securities issued by it; changes in

counterparty risk; changes in consumer

behaviour; the direct and indirect consequences

of the conflicts in Ukraine and the Middle East on

European and global macroeconomic conditions,

political stability and financial markets; political

elections; developments in the UK’s relationship

with the European Union (EU); the risk of

cyberattacks, information or security breaches,

technology failures or other operational

disruptions and any subsequent impacts on the

Group’s reputation, business or operations; the

Group’s ability to access funding; and the

success of acquisitions, disposals and other

strategic transactions. A number of these

factors are beyond the Group’s control. As a

result, the Group’s actual financial position,

results, financial and non-financial metrics or

performance measures or its ability to meet

commitments and targets may differ materially

from the statements or guidance set forth in the

Group’s forward-looking statements. In setting

its targets and outlook for the period 2024-2026,

Barclays has made certain assumptions about

the macro-economic environment, including,

without limitation, inflation, interest and

unemployment rates, the different markets and

competitive conditions in which Barclays

operates, and its ability to grow certain

businesses and achieve costs savings and other

structural actions. Additional risks and factors

which may impact the Group’s future financial

condition and performance are identified in the

description of material existing and emerging

risks beginning on page [258](#i2207833d992a41c98da57124d8d2efb7_761) of this Annual

Report.

Subject to Barclays PLC’s obligations under the

applicable laws and regulations of any relevant

jurisdiction (including, without limitation, the UK

and the US) in relation to disclosure and ongoing

information, we undertake no obligation to

update publicly or revise any forward-looking

statements, whether as a result of new

information, future events or otherwise.

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| Strategic  report |  | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  information |  | Barclays PLC  Annual Report 2023 | 58 |
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| Important Information | | | | | | | | | | |

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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Climate and Sustainability report | | | | | | | | | | |  |  |
|  | The Climate and Sustainability report forms Part 2 of the Barclays PLC 2023 Annual Report.  Parts 1, 2 and 3 together comprise Barclays PLC's annual accounts and report for the purposes  of Section 423 of the Companies Act 2006. | | | | | | | | | | |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | TCFD Strategy Recommendation A |  |  |  |  | TCFD Strategy Recommendation B |  |  |  |  | TCFD Strategy Recommendation C |  |  |
|  | Describe the climate-related risks and  opportunities the organisation has identified  over the short, medium, and long term. |  |  |  |  | Describe the impact of climate-related risks and  opportunities on the organisation’s businesses,  strategy, and financial planning. |  |  |  |  | Describe the resilience of the organisation’s  strategy, taking into consideration different climate-  related scenarios, including a 2°C or lower scenario. |  |  |
|  | [Risks and opportunities](#i4be61753b7f243b19551b0bfbf3a2a0d_250) | [66](#i4be61753b7f243b19551b0bfbf3a2a0d_250) |  |  |  | [Implementing our Climate Strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_259) | [72](#i4be61753b7f243b19551b0bfbf3a2a0d_259) |  |  |  | [Resilience of our strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_406) | [130](#i4be61753b7f243b19551b0bfbf3a2a0d_406) |  |
|  | [Risks](#i4be61753b7f243b19551b0bfbf3a2a0d_253) | [67](#i4be61753b7f243b19551b0bfbf3a2a0d_253) |  |  |  | [Achieving net zero operations](#i4be61753b7f243b19551b0bfbf3a2a0d_262) | [73](#i4be61753b7f243b19551b0bfbf3a2a0d_262) |  |  |  | Scenario analysis | [131](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061446) |  |
|  | [Opportunities](#i4be61753b7f243b19551b0bfbf3a2a0d_256) | [70](#i4be61753b7f243b19551b0bfbf3a2a0d_256) |  |  |  | Operational footprint dashboard | [75](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686060018) |  |  |  | Barclays’ resilience to climate scenarios | [132](#i4be61753b7f243b19551b0bfbf3a2a0d_16082) |  |
|  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_271) | [76](#i4be61753b7f243b19551b0bfbf3a2a0d_271) |  |  |  | Climate stress tests | [132](#i4be61753b7f243b19551b0bfbf3a2a0d_16082) |  |
|  |  |  |  |  |  | [Reducing our financed emissions](#i4be61753b7f243b19551b0bfbf3a2a0d_283) | [80](#i4be61753b7f243b19551b0bfbf3a2a0d_283) |  |  |  | 2023 Enhancements and beyond | [134](#ib4213872474249fd834c9b5748668ac3_2-1-1-1-2543322) |  |
|  |  |  |  |  |  | BlueTrackTM  dashboard | [88](#i4be61753b7f243b19551b0bfbf3a2a0d_12116) |  |  |  | Challenges and limitations | [135](#ic42a2c24620a4a25a4eb81cde6bc5f7a_2-1-1-1-2582708) |  |
|  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_289) | [89](#i4be61753b7f243b19551b0bfbf3a2a0d_289) |  |  |  | Macro-dependencies and objectives | [136](#i4be61753b7f243b19551b0bfbf3a2a0d_16064) |  |
|  |  |  |  |  |  | [Financing the transition](#i4be61753b7f243b19551b0bfbf3a2a0d_319) | [101](#i4be61753b7f243b19551b0bfbf3a2a0d_319) |  |  |  | [Important information/disclaimers](#i4be61753b7f243b19551b0bfbf3a2a0d_427) | [137](#i4be61753b7f243b19551b0bfbf3a2a0d_427) |  |
|  |  |  |  |  |  | [Sustainable finance dashboard](#i4be61753b7f243b19551b0bfbf3a2a0d_328) | [103](#i4be61753b7f243b19551b0bfbf3a2a0d_328) |  |  |  |  |  |  |
|  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_331) | [104](#i4be61753b7f243b19551b0bfbf3a2a0d_331) |  |  |  |  |  |  |
|  |  |  |  |  |  | [Working with our clients](#i4be61753b7f243b19551b0bfbf3a2a0d_334) | [107](#i4be61753b7f243b19551b0bfbf3a2a0d_334) |  |  |  |  |  |  |
|  |  |  |  |  |  | [Embedding climate and sustainability into our](#i4be61753b7f243b19551b0bfbf3a2a0d_379)  [business](#i4be61753b7f243b19551b0bfbf3a2a0d_379) | [121](#i4be61753b7f243b19551b0bfbf3a2a0d_379) |  |  |  |  |  |  |
|  |  |  |  |  |  | [Just transition and nature and biodiversity](#i4be61753b7f243b19551b0bfbf3a2a0d_388) | [124](#i4be61753b7f243b19551b0bfbf3a2a0d_388) |  |  |  |  |  |  |
|  |  |  |  |  |  | [Engaging with industry](#i4be61753b7f243b19551b0bfbf3a2a0d_397) | [126](#i4be61753b7f243b19551b0bfbf3a2a0d_397) |  |  |  |  |  |  |
|  |  |  |  |  |  | [Barclays' approach to public policy](#i4be61753b7f243b19551b0bfbf3a2a0d_400) | [129](#i4be61753b7f243b19551b0bfbf3a2a0d_400) |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| A strategy for a better  financial future |  | Our climate strategy is driven by consideration of relevant  risks and opportunities and in alignment with our Purpose:  working together for a better financial future for our  customers, clients and communities. |
|  |  |  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Barclays’ climate strategy | | | | | |  |  |  |  |  |  |
|  |  | 1 |  |  |  | 2 |  |  |  | 3 |  |  |
|  |  | Achieving net zero  operations |  |  |  | Reducing our  financed emissions |  |  |  | Financing  the transition |  |  |
|  |  | Barclays is working to  reduce its Scope 1, Scope  2 and Scope 3 operational  emissions consistent with  a 1.5°C aligned pathway,  and counterbalance any  residual emissions. |  |  |  | Barclays is committed to  aligning its financing with  the goals and timelines of  the Paris Agreement,  consistent with limiting  the increase in global  temperatures to 1.5°C. |  |  |  | Barclays is helping to  provide the green and  sustainable finance  required to transform the  economies, customers  and clients we serve. |  |  |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Our strategy is underpinned by the way we assess and  manage our exposure to climate-related risk | | | | | | | | |  |  |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |

We have a clear shareholder endorsed climate

strategy to achieve our ambition of being a net zero

bank by 2050, by achieving net zero operations,

reducing our financed emissions and financing the

transition.

We are committed to achieving net zero operations

and have continued to make progress, achieving a

51%Δ reduction of Scope 1 and 2 location-based

greenhouse gas emissions milestone ahead of

schedule. We continued to source 100%Δ

renewable electricity for our global real estate

portfolio and met our 90% Scope 1 and 2 market-

based emissions reduction target – reducing these

emissions by 93%Δ.

We are also committed to reducing our financed

emissions, those deriving from the activities of the

clients that we finance and those generated in their

respective value chains, by providing financial advice

and support as they transition to a low-carbon

economy.

We have now set 2030 emissions reduction targets

for eight of the highest-emitting sectors in our

portfolio: Energy, Power, Cement, Steel,

Automotive manufacturing, Aviation, Agriculture

and Commercial Real Estate; and have assessed

the baseline and convergence point for our UK

Housing portfolio. This meets our commitment

under the NZBA to set targets for material high-

emitting sectors in our portfolio.

Our 2030 target-setting includes the integration of

1.5oC aligned scenarios, such as the IEA Net Zero

2050 scenario, in our financed emission targets,

and includes ranges for certain sectors to reflect

dependencies outside our control that will

determine how quickly our financed emissions can

be reduced in these sectors.

This year, we have further extended the scope of

our calculations to cover the full in-scope balance

sheet financed emissions, largely aligned to the

PCAF Standard. We used our methodology for

measuring our financed emissions and tracking

them at a portfolio level against the goals and

timelines of the Paris Agreement – this

methodology is called BlueTrack™.

Capital is critical for a successful energy transition

and we are focusing our financing to those clients

actively engaged in the energy transition.

The scale of our business gives us the opportunity

to help finance the energy transition – to use our

global reach, products, expertise and position in the

global economy to work with our clients, including

those in the Energy sector, as they transition to a

low-carbon business model.

To reduce reliance on fossil fuels the world needs to

accelerate and scale the supply and capacity of

renewables and climate tech solutions that will help

to decarbonise high-emitting activities. The Climate

Policy Initiative estimates that this requires at least

$4.3trillion of climate finance a year by 20301.

Notes:

Δ  2023 data subject to independent limited assurance under ISAE

(UK)3000 and ISAE 3410. Current limited assurance scope and

opinion can be found within the ESG Resource Hub:

home.barclays/sustainability/esg-resource-hub/reporting-and-

disclosures/

1 Climate Policy Initiative - Global Landscape of Climate Finance:

A Decade in Data climatepolicyinitiative.org/wp-content/

uploads/2022/10/Global-Landscape-of-Climate-Finance-A-

Decade-of-Data.pdf

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 60 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Barclays’ climate strategy | | | | | | | | | | |

![TRANSPLAN_TASKFORCE.jpg]()

Barclays is committed to help finance the energy

transition, In 2022 we set a target to facilitate $1trn

of Sustainable and Transition Financing between

2023 and the end of 2030.

During 2023, we facilitated $67.8bnΔ of

sustainable and transition financing. $67.4bn was

sustainable financing and $0.4bnΔ was transition

financing that qualified against our new

Transition Finance Framework.

We are also focused on investing and scaling the

climate tech – hydrogen, carbon capture,

batteries, amongst others – needed by society

and our clients to transition, generate economic

growth and create a new wave of green jobs. To

support this, we have a mandate to invest up to

£500m of Barclays’ own capital by the end of

2027 and we have invested £138m into 21

innovative companies to date.

An important lever for reducing our financed

emissions is our policy. In February 2024, we

updated our Climate Change Statement with

new restrictions on financing upstream oil and

gas, including unconventional oil and gas and

additional Enhanced Due Diligence (EDD)

requirements for biomass.

Fossil fuels are still required for many essential

activities – including electricity generation,

transport and heating. In the International Energy

Agency NZE scenario, new long lead time

upstream oil and gas projects are not required on

a 1.5°C-aligned pathway. For current and future

(declining) global demand to be satisfied,

investment is needed to support existing assets,

while clean energy is scaled2. Barclays

understands the critical importance of energy

being secure, reliable and affordable for our

customers and clients.

Barclays will continue to support an energy

sector in transition, focusing on the diversified

energy companies investing in low carbon and

with greater scrutiny on those engaged in

developing new oil and gas projects.

The trajectory for our clients’ transition to a low-

carbon economy is influenced by a number of

external factors, including market developments,

technological advancement, the public policy

environment, geopolitical developments and

regional variations, behavioural change in society

and the scale of change needed to adapt their

business models. Client transition pathways will

vary, even within the same sectors and

geographies.

Many highly carbon-intensive sectors require

finance to transition to a low carbon economy.

Restricting the flow of capital to these sectors

could be harmful to the pace of the transition,

limiting the real terms impact on global warming.

The energy companies unable or unwilling to

reduce their emissions or play a role in the energy

transition may find it increasingly difficult to

access financing from Barclays.

We are committed to continuing the work we

began in 2020. Our climate strategy will continue

to evolve and adapt in light of the rapidly

changing environment and the need to support

governments and clients, in our efforts to meet

our ambition of being a net zero bank by 2050.

Notes:

Δ    2023 data subject to independent limited assurance under ISAE

(UK) 3000 and ISAE 3410. Current limited assurance scope and

opinion can be found within the ESG Resource Hub:

home.barclays/sustainability/esg-resource-hub/reporting-and-

disclosures/

2 International Energy Agency - Net Zero Roadmap, 2023 Update

iea.blob.core.windows.net/

assets/9a698da4-4002-4e53-8ef3-631d8971bf84/

NetZeroRoadmap\_AGlobalPathwaytoKeepthe1.5CGoalinReach

-2023Update.pdf

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| --- | --- |
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| + | Please see the Barclays Climate and Sustainability report  from page  [60](#i4be61753b7f243b19551b0bfbf3a2a0d_17257) for further details on Barclays' ambition to be  a net zero bank. |
|  |
|  | Barclays' climate, sustainability, and ESG-related data,  targets and progress can be found within the ESG Data  Centre within our [ESG Resource Hub](https://home.barclays/sustainability/esg-resource-hub/). |
|  | Further details on our BlueTrackTM  methodology can be  found within our Financed Emissions Methodology  paper (published in 2024) accessible at: [home.barclays/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [sustainability/esg-resource-hub/reporting-and-](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/) |

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| --- | --- | --- | --- | --- |
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|  | Collaborating with the Transition Plan Taskforce  The Transition Plan Taskforce (TPT) was launched by HM Treasury in March 2022 with a mandate  to bring together leaders from industry, academia, and regulators to develop good practice for  transition plan disclosures for the finance sector and the real economy. Barclays participated in a  number of working groups for the TPT, including inputting into the Banks Sector Guidance – which  adds further depth and detail for preparers of transition plans operating in the banking sector.  Barclays contributed to the development of the additional guidance, sharing its views on particular  nuances of transition planning for bank s – including the incorporation of nature and just transition  elements. The guidance was published for consultation in October 2023, with Barclays  participating in the launch event. | | |  |
|  |  |  |  |  |
|  | Our approach to TPT disclosures  Over 2023, Barclays participated in a number of working groups of the Transition Plan Taskforce  (TPT), supporting the development of its framework for transition plan disclosures. We are  developing our approach to the TPT’s recommendations, taking into account relevant guidance  as it develops, and elements of the TPT’s Disclosure Framework (including the Implementation  Guidance and draft Banks Sector Guidance) are addressed in our climate related disclosures  included in this Annual Report. During 2024, we will look to further develop elements of our climate  disclosures including transition planning. This will be reflected in future disclosures, as we work  towards publishing our own transition plan. | | |  |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 61 |
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| Barclays’ climate strategy (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | Further details can be found at:  transitiontaskforce.net/wp-content/uploads/2023/11/TPT-Banks-Sector-  Guidance.pdf |
|  |

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| --- | --- | --- |
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| Our strategy, selected targets  and progress |  | The table below sets out selected targets and policies we  have previously announced, progress against them,  as well as new announcements as of the publication of  this Annual Report. |
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| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Strategic pillar |  | Previously Announced Target/Policy | Progress | New Announcement |
| 1  Achieving  net zero  operations | By end 2025 | | 2023 performance | We are working towards the following milestones |
| Energy | • 100% renewable electricity sourcing for our global real  estate portfolio by end of 2025 | 100%Δ  sourced | N/A |
| Reduction of GHG  emissions | • 90% reduction in Scope 1 and 2 GHG emissions  (market-based, against a 2018 baseline) | -93%Δ reduction | N/A |
|  |  |  |  |  |
| 2  Reducing  our financed  emissions  Portfolio reduction  targets/  convergence point | By the end of 2030 | | Cumulative change | By the end of 2030 |
| Energy1 | • 40% reduction in absolute CO2 e emissions against  a 2020 baseline of 75.4 Δ  MtCO 2 e (Scopes 1, 2 & 3) | -44% | N/A |
| Power1 | • 50-69% reduction in CO2 e emissions intensity against  a 2020 baseline of 326Δ  kgCO 2 e/MWh (Scope 1) | -26% | N/A |
| Cement1 | • 20-26% reduction in CO2 e emission intensity against  a 2021 baseline of 0.626 Δ  tCO2 e/t (Scopes 1 & 2) | -8% | N/A |
| Steel1 | • 20-40% reduction in CO2 e emissions intensity against  a 2021 baseline of 1.945Δ tCO 2 e/t (Scopes 1 & 2) | -16% | N/A |
| Automotive  manufacturing1 | • 40-64 % reduction in CO2e emissions intensity against  a 2022 baseline of 174.8Δ gCO2e/km (Scopes 1, 2 & 3) | 0% | N/A |
| UK Housing1 | • Convergence point: 40% reduction in CO2e emissions  intensity against a 2022 baseline of 32.0Δ kgCO2e/m2  (Scopes 1 & 2) for formerly UK Residential Real Estate | +1% | • Convergence point: 40% reduction in CO2e emissions intensity against a 2023 baseline  of 32.1Δ kgCO 2 e/m 2  (Scopes 1 & 2) for expanded scope covering social housing and  business banking real estate |
| UK Commercial Real  estate | N/A | N/A | • 51% reduction in CO2 e emissions intensity against a 2023 baseline of 30.0 Δ  kgCO 2 e/m 2  (Scopes 1 & 2) |
| UK Agriculture -  Livestock & Dairy | N/A | N/A | • 21% reduction in absolute CO2 e emissions against a 2023 baseline of 2.4 Δ  MtCO 2e  (Scopes 1, 2 & 3) |
| Aviation | N/A | N/A | • 11-16 % reduction in CO2 e emissions intensity against a 2023 baseline of 882Δ  gCO 2 e/  RTK (Scopes 1 & 3) |

Notes:

Δ    2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub for further details: home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/

1 Reported values marked with Δ have been re-baselined in the current year.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 62 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Barclays’ climate strategy (continued) | | | | | | | | | | |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Strategic pillar |  | Previously Announced Policy | New Announcements1 | |
| 2  Reducing  our financed  emissions  Restrictive policies2 |  |  | Project level restrictions | Entity level restrictions |
| Upstream Oil & Gas | N/A | From 9 February 2024:  • We will not provide project finance for expansion projects  or for infrastructure projects primarily to be used for  such expansion projects.  • We will not provide other direct financing to Energy  Groups for expansion projects or infrastructure projects  primarily to be used for such expansion projects. | From 9 February 2024:  • We will not provide financing to new clients that are Energy Groups where more than  10% of their total planned oil & gas capital expenditure is in expansion.  By 1 January 2025:  • We expect all Energy Groups to be producing relevant information in relation to  their transition plans or decarbonisation strategies.  From 1 January 2025:  • Any new financing or renewal of existing financing for Non-diversified Groups where  more than 10% of their total planned oil & gas capital expenditure is in long-lead  expansion would be by exception.  From 1 January 2026:  • We will only provide financing to Energy Groups if they are able to demonstrate that  they are committed to reducing their own emissions by having:  – net zero-aligned near-term Scope 1 and 2 emissions reduction targets (absolute  or intensity-based); and  – targets to reduce methane emissions by 2030, aligned with OGCI, OGMP2.0 or  similar industry guidance; and  – a commitment to end all routine / non-essential venting and flaring by 2030. |
| Unconventional Oil  & Gas | • Existing project and entity level  restrictions on unconventional oil &  gas (including Arctic Circle oil & gas,  Hydraulic Fracturing and Oil Sands)  remain in place. | From 9 February 2024:  • We will not provide direct financing to Energy Groups for  any oil & gas projects in the Amazon Biome, or any oil &  gas projects involving Ultra-Deep Water and/or Extra  Heavy Oil, or infrastructure projects primarily to be used  for such oil & gas projects. | From 30 June 2024:  • We will not provide financing to Energy Groups whose aggregate share of  production in Oil Sands, Extra Heavy Oil, Hydraulic Fracturing in the UK/EU, and Arctic  Circle oil & gas exceeds 20% of their total oil & gas production.  • We will not provide financing to Clients engaged in exploration, appraisal,  development, and production of oil & gas in the Amazon Biome. |
| Thermal Coal  Mining | • Existing project and entity level  restrictions on thermal coal mining  remain in place. | From 9 February 2024:  • No project finance for greenfield development or  material expansion of thermal coal mines anywhere in the  world, including captives. (Note: this was an update to an  existing restriction to include captives)  • No project finance for development of infrastructure  projects primarily to be used for thermal coal mines  anywhere in the world. |  |
|  | Thermal Coal  Power | • Existing project and entity level  restrictions on thermal coal-fired  power remain in place. | From 9 February 2024:  • No project finance to enable construction or material  expansion of thermal coal-fired power plants anywhere  in the world, including captives. (Note: this was an  update to an existing restriction to include captives) |  |

Notes:

1 For details on the exact scope and application of these restrictions please refer to the Climate Change Statement found at: home.barclays/sustainability/esg-resource-hub/statements-and-policy-positions/

2 Words in italics are defined in the Climate Change Statement found at: home.barclays/sustainability/esg-resource-hub/statements-and-policy-positions/

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 63 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Barclays’ climate strategy (continued) | | | | | | | | | | |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Strategic pillar |  | Previously Announced Target/Policy | Progress |
| 3  Financing  the transition | Previously Announced Target | | 2023 performance |
| Sustainable financing | • Facilitate $1trn of Sustainable and Transition Financing  between 2023 and end of 2030  • Facilitate £100bn of green financing between 2018 and  2030 | • $67.8bnΔ    • £25.9bnΔ (Cumulative performance: £113.7bnΔ) |
| Sustainable Impact  Capital | • Increase mandate to invest up to £500m of Barclays'  capital in global climate tech start-ups by the end of 2027 | • £49.49m (£138.4m invested by the end of 2023) |

Δ2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub: home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 64 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Barclays’ climate strategy (continued) | | | | | | | | | | |

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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Climate Action Roadmap  Barclays has been taking action on climate change for a number of years. The below roadmap highlights key targets, actions and policies relating to achieving net zero operations, reducing our financed  emissions and financing the transition. These are key milestones on the way to achieving our ambition to be a net zero bank by 2050. | | | | | | | | | | | | | | | | | | | | | | | | | | |  |
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|  |  | Pre-  2018 |  | 2018 |  | 2019 |  | 2020 |  | 2021 |  | 2022 |  | 2023 |  | 2024 |  | 2025 |  | 2026 |  | 2030 |  | 2035 |  | 2050 |  |  |
|  | Notes:  1 Financial Stability Board    | 2 Taskforce on Climate-related Financial Disclosures    | 3 See our Climate Change Statement updated in February 2024 for further details including on scope and definition    | 4 See section on Net Zero Operations    | 5 Paris Agreement Capital Transition  Assessment    | 6 See section Reducing our financed emissions    | 7 Originally called Residential Real Estate, updated in 2024    | 8 Sustainable Impact Capital    | 9 Net-Zero Banking Alliance  | 10 Partnership for Carbon Accounting Financials    |  11 PCAF Standard - PCAF (2022). The  Global GHG Accounting and Reporting Standard Part A: Financed Emissions. Second Edition. | | | | | | | | | | | | | | | | | | | | | | | | | | |  |
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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 65 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Barclays’ climate strategy (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| •  Joined Paris Pledge  for Action in 2015  •  Signed statement of  support of the FSB’s 1  TCFD 2  in 2017 | •  Joined PACTA5  pilot  • Published Climate Change  Statement3 setting  out restrictions for  sensitive sectors | •  Founding member of  the NZBA 9  • Exceeded target to  facilitate £150bn of social,  environmental and  sustainability-linked  financing by 2025  • Exceeded 2025 operational  emissions and energy  targets 4 | • Announced 2030 Autos target,  convergence point for UK  Housing7 and ambition for  50% of mortgages to have  EPC C or better by 2030 6  • Expanded our net zero  operations approach and  announced new operational  milestones4  •  Exceeded target to  facilitate £100bn of green  financing by 2030  • Financing restrictions came  into effect for certain  thermal coal mining, coal  power and oil sands clients 3 | •  Tightened financing  restrictions for coal-fired  power generation clients will  come into effect3  •  Transition plan expectations  for Energy Groups will come  into effect3 | •  Financing  to thermal coal  mining or coal-fired power  generation clients in the EU  and OECD will be phased  out3  • Financing to clients with >10%  revenue from thermal coal  mining or coal-fired power  generation in the RoW will be  restricted3 | •  NZ ambition |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| •  Announced 2025 £150bn  social and environmental  financing target and 2030  £100bn green financing  target  •  One of the first UK banks  to launch a 'Green  Home Mortgage'  • Announced  targets to reduce  operational emissions by  80% and procure 90%  renewable energy by 20254 | •  Announced ambition  to be a net zero bank by 2050  •  Launched BlueTrack™  with 2025 Energy and  Power targets 6  •  Launched £175m  Sustainable Impact Capital8  initiative | • Announced 2030 Energy,  Power, Cement and  Steel targets 6  • Announced $1tn Sustainable  and Transition Financing  target and increased SIC 8  mandate to invest up to  £500m  • Announced new operational  emissions and electricity  sourcing targets4  • Elevated Climate risk to  a Principal Risk  • Held a ‘Say on Climate’  advisory vote | • Updated Climate Change  Statement  with new  financing restrictions for  upstream oil and gas3  •  Announced 2030 targets for  Agriculture, Commercial  Real Estate, and Aviation,  and updated scope for  UK Housing7 convergence  point6 and EPC ambition  •  Estimated full in-scope  balance sheet financed  emissions using  methodology developed  using PCAF10 Standard11 | •  Minimum requirements for  Scope 1 and 2 targets,  methane abatement and  venting/flaring for Energy  Groups will come into effect3 | •  All financing  to thermal coal  mining or coal-fired power  generation clients will be  phased out3 |

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Risk and opportunities | | | | | | | | | | | |  |  |
|  |  |  | | | | | | | | | | |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | TCFD Strategy Recommendation A: |  |  |  |  | TCFD Strategy Recommendation B: |  |  |  |  | TCFD Strategy Recommendation C: |  |  |
|  |  | Describe the climate-related risks and  opportunities the organisation has identified over  the short, medium, and long term. |  |  |  |  | Describe the impact of climate-related risks and  opportunities on the organisation’s businesses,  strategy, and financial planning. |  |  |  |  | Describe the resilience of the organisation’s  strategy, taking into consideration different  climate-related scenarios, including a 2°C or  lower scenario. |  |  |
|  |  | [Risks and opportunities](#i4be61753b7f243b19551b0bfbf3a2a0d_250) | [66](#i4be61753b7f243b19551b0bfbf3a2a0d_250) |  |  |  | [Implementing our climate strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_259) | [72](#i4be61753b7f243b19551b0bfbf3a2a0d_259) |  |  |  | [Resilience of our strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_406) | [130](#i4be61753b7f243b19551b0bfbf3a2a0d_406) |  |
|  |  | [Risks](#i4be61753b7f243b19551b0bfbf3a2a0d_253) | [67](#i4be61753b7f243b19551b0bfbf3a2a0d_253) |  |  |  | [Achieving net zero operations](#i4be61753b7f243b19551b0bfbf3a2a0d_262) | [73](#i4be61753b7f243b19551b0bfbf3a2a0d_262) |  |  |  | Scenario analysis | [131](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061446) |  |
|  |  | [Opportunities](#i4be61753b7f243b19551b0bfbf3a2a0d_256) | [70](#i4be61753b7f243b19551b0bfbf3a2a0d_256) |  |  |  | Operational footprint dashboard | [75](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686060018) |  |  |  | Barclays’ resilience to climate scenarios | [132](#i4be61753b7f243b19551b0bfbf3a2a0d_16082) |  |
|  |  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_271) | [76](#i4be61753b7f243b19551b0bfbf3a2a0d_271) |  |  |  | Climate stress tests | [133](#i4be61753b7f243b19551b0bfbf3a2a0d_415) |  |
|  |  |  |  |  |  |  | [Reducing our financed emissions](#i4be61753b7f243b19551b0bfbf3a2a0d_283) | [80](#i4be61753b7f243b19551b0bfbf3a2a0d_283) |  |  |  | 2023 Enhancements and beyond | [134](#ib4213872474249fd834c9b5748668ac3_2-1-1-1-2543322) |  |
|  |  |  |  |  |  |  | BlueTrackTM  dashboard | [88](#i4be61753b7f243b19551b0bfbf3a2a0d_12116) |  |  |  | Challenges and limitations | [135](#ic42a2c24620a4a25a4eb81cde6bc5f7a_2-1-1-1-2582708) |  |
|  |  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_289) | [89](#i4be61753b7f243b19551b0bfbf3a2a0d_289) |  |  |  | Macro-dependencies and objectives | [136](#i4be61753b7f243b19551b0bfbf3a2a0d_16064) |  |
|  |  |  |  |  |  |  | [Financing the transition](#i4be61753b7f243b19551b0bfbf3a2a0d_319) | [101](#i4be61753b7f243b19551b0bfbf3a2a0d_319) |  |  |  | [Important information/disclaimers](#i4be61753b7f243b19551b0bfbf3a2a0d_427) | [137](#i4be61753b7f243b19551b0bfbf3a2a0d_427) |  |
|  |  |  |  |  |  |  | [Sustainable finance dashboard](#i4be61753b7f243b19551b0bfbf3a2a0d_328) | [103](#i4be61753b7f243b19551b0bfbf3a2a0d_328) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_331) | [104](#i4be61753b7f243b19551b0bfbf3a2a0d_331) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Working with our clients](#i4be61753b7f243b19551b0bfbf3a2a0d_334) | [107](#i4be61753b7f243b19551b0bfbf3a2a0d_334) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Embedding climate and sustainability into our](#i4be61753b7f243b19551b0bfbf3a2a0d_379)  [business](#i4be61753b7f243b19551b0bfbf3a2a0d_379) | [121](#i4be61753b7f243b19551b0bfbf3a2a0d_379) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Just transition and nature and biodiversity](#i4be61753b7f243b19551b0bfbf3a2a0d_388) | [124](#i4be61753b7f243b19551b0bfbf3a2a0d_388) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Engaging with industry](#i4be61753b7f243b19551b0bfbf3a2a0d_397) | [126](#i4be61753b7f243b19551b0bfbf3a2a0d_397) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Barclays' approach to public policy](#i4be61753b7f243b19551b0bfbf3a2a0d_400) | [129](#i4be61753b7f243b19551b0bfbf3a2a0d_400) |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

|  |
| --- |
|  |
|  |
| Climate-related risks identified over  the short, medium and long term |
|  |
|  |
| Our climate strategy is underpinned by the  way we assess and manage our exposure to  climate-related risks. Climate risk is a  Principal Risk within the Barclays Enterprise  Risk Management Framework. |
|  |

Barclays faces exposure to climate-related risks

either directly through its operations and

infrastructure or indirectly through its financing

and investment activities. The two main

categories of climate-related risks are physical

risks and transition risks.

Physical risks

Physical risks result from a changing climate and

can be event-driven (acute risks), including

increased frequency and/or severity of extreme

weather events such as cyclone, hurricanes and

flooding. Physical risks can also be driven by

longer-term shifts in climate patterns (chronic

risks) from sustained higher temperatures,

leading to rising sea levels, rising mean

temperatures and more severe weather events.

Transition risks

Transition risks result from the transition to a

lower-carbon economy. This is likely to involve

significant, rapid policy, regulatory and legal

changes, as well as the evolution of technology

and markets to adapt to a changing climate and

associated impacts.

Time horizons

The impact of physical and transition risks can be

significant and widespread, affecting Barclays'

portfolio and financial performance over short-,

medium- and long-terms horizons.

In the short term, physical risks arising from

extreme weather events and climate-related

disasters pose a direct threat to Barclays'

physical assets and infrastructure. This can

potentially result in immediate losses, increased

costs for repair and higher insurance premiums.

Similarly, acute events may also potentially

damage the physical facilities of Barclays' clients

or cause business disruptions, which may

adversely impact the value of clients' assets,

reduce their profitability and subsequently lead

to potential increase in credit risk for Barclays.

Additionally, operations in regions prone to high

physical risks may also experience higher

insurance premiums or limited insurance

coverage.

Transition risks are expected to occur in all

timeframes, but more broadly over the medium

term. The cost of transitioning to cleaner

technologies and sustainable business practices

may strain the financial resources of businesses,

affecting profitability and long-term viability.

Financial institutions like Barclays could also face

significant increases in costs and resources

allocated to adhere to new policies, laws and

regulations aimed at transitioning to a lower-

carbon economy. This in turn may lead to higher

conduct and operational risks to Barclays. At an

individual level, there may be challenges related

to employment opportunities as businesses

transition away from carbon-intensive practices.

This in turn may impact the creditworthiness of

Barclays' clients and their ability to repay loans.

Transition risks aimed at mitigating climate

change can also impact the profitability and value

of assets in Barclays' portfolio, particularly those

linked to carbon-intensive industries. Companies

perceived as slow to adapt or unresponsive to

environmental concerns may face reputational

damage or legal actions leading to decreased

customer trust and investor support.

With escalating concerns and heightened global

awareness of climate risks, it is likely that litigation

linked to these risks will increase. Additionally,

Barclays may face greater scrutiny of the type of

business it conducts – including in the form of

adverse media coverage and an increase in

climate-related litigation cases. This in turn may

adversely impact customer demand for Barclays'

products, returns on business activities, value of

assets and trading positions, resulting in higher

impairment charges.

Looking to the longer term, the cumulative

effects of global temperature rise are likely to

become increasingly pronounced – influencing

ecosystems, sea levels and societal structures.

Climate change can also trigger tipping points

through feedback loops that amplify its effects.

Certain tipping points are already underway,

manifesting in observable changes across the

globe. Different tipping elements, such as the

melting of ice sheets or changes in ocean

circulation, have varying time horizons. As the

science develops, we are observing that some

tipping points may run on a shorter timeline than

initially expected. Accordingly, the uncertainty of

exact timeframes in which such tipping points are

expected to materialise adds a layer of

complexity – making it challenging to precisely

predict when impacts will materialise.

When considering the timescales of climate-

related risks, Barclays has categorised short,

medium and long term as follows:

• Short term (S): 0-1 year

• Medium term (M): 1-5 years

• Long term (L): 5-30 years.

The short-term timescale coincides with the

short-term plan for annual budgets and granular

financial plans. The medium term coincides with

the five-year financial, capital and funding plans.

Climate change as a driver of risk

The feedback effects of climate risk drivers

through macro and micro transmission channels

are observed in Barclays' portfolio through

traditional risk categories such as credit risk,

market risk, treasury and capital risk, operational

risk and reputational risk. The approach to

identifying, measuring and managing climate-

related risks is consistent with other key risks,

however there remains significant uncertainty

around when these risks will materialise.

Climate risk is integrated into the broader

Enterprise Risk Management Framework,

aligning with other Principal Risks and ensuring a

holistic approach to risk identification,

assessment and management. Barclays' Climate

Risk Framework facilitates a structured

integration of climate risk considerations into the

Bank's operations. It undergoes regular reviews

and updates – including changes to risk

taxonomy, definitions and methodology – to align

with changing regulatory expectations and

external developments. Following the annual

review of the Climate Risk Framework in 2023,

Barclays no longer considers that a separate

category is needed to capture second-order

impacts of physical and transition risk, as these

impacts are already being captured and managed

within the existing assessments and framework.

Therefore, connected risks no longer features as

a separate category.

The potential impacts of physical and transition

risk drivers will vary across Barclays' portfolios

depending on composition, industry, geographic

location, business operations and other

contextual factors.

The tables below set out the example drivers,

example potential impacts and expected time

horizons of various physical and transition risks.

|  |  |
| --- | --- |
|  |  |
| + | Further details on how Barclays manages climate risk can be  found on pages  [272](#i4be61753b7f243b19551b0bfbf3a2a0d_9306)  t o [276](#i4be61753b7f243b19551b0bfbf3a2a0d_12263). |
|  |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 67 |
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| Risk and opportunities | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (a) |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Transition risks | Policy and legal | Reputation | Technology | Market |
| Example drivers | • Carbon tax impacting sectors and clients  • Enhanced GHG reporting obligations  • Government and non-governmental  organisations taking litigation actions | • Increased stakeholder concern or  negative stakeholder feedback  • Shifts in consumer preferences  • Stigmatisation of sectors | • Disruptive substitute technologies being  favoured because of lower carbon  footprint  • Development of emissions capture and  recycling facilities  • Investments in new technologies | • Changes in supply and demand of raw  materials  • Uncertainty in market signals  • Changing market sentiment |
| Example potential impacts | • Increased operating costs for compliance  or due to fines from regulators or  damages from litigation  • Write-offs and early retirement of assets  due to policy changes  • Changes in asset valuations | • Increased costs and reduced demand for  products and services  • Decreased production capacity due to  poor employee attraction and retention  • Reduction in capital availability | • Write-offs and early retirement of assets  • Research and development expenditure  in new technologies  • Costs for adoption of new practices and  processes | • Increased costs and reduced demand for  products and services  • Increased production costs due to changing  input prices and output requirements  • Decreased revenue and repricing of assets |
| Expected time horizons | S, M, L | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Physical risks | Acute | Chronic |
| Example drivers | • Damage to fixed assets and infrastructure (e.g. property, power supplies) by wildfires  • Adverse impact on agriculture and production of soft commodities due to drought  • Transport difficulties and damage to infrastructure due to severe storm and flooding | • Change in weather and precipitation patterns resulting in reduced agricultural yields and  land no longer suitable for farming  • Potential population migration due to uninhabitable land  • Increase in sea levels and consequent coastal erosion requiring building of new seawall  and flood defences  • Rising temperatures resulting in diminished productivity and health issues |
| Example potential impacts | • Increased costs due to damage to facilities  • Reduced revenue from decreased production capacity  • Increased operating costs and decrease in sales due to unavailability of raw materials  and supply chain disruptions | • Reduced revenue from decreased production capacity and early retirement of assets  • Decrease in property values  • Increased costs and insurance for assets in high-risk locations  • Reduced revenue from lower sales and output |
| Expected time horizons | S, M, L | M, L |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 68 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk and opportunities (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (a) |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| i |  |  | i |
|  | Building our understanding of nature-related risk | |  |
|  |  |  |  |
|  | Nature-related risks arise from an organisation's  dependencies and impacts on nature. These risks  can be physical risks and transition risks, which in  turn can present financial risks1.  As such, this year we have undertaken further work  to develop our understanding of nature-related  risks and how these relate to different industry  sectors. Building on last year's heatmap analysis, we  have updated our approach using publicly available  data and explored a wider set of impacts and  dependencies. This work has been designed to help  build our understanding of the material nature-  related impacts, dependencies, risks and  opportunities within priority industry sectors, and  indicate where we might focus further analysis, as  we continue to build our nature related assessment  and decision-making capabilities.  Through this work, we have developed an updated  heatmap by mapping industry classification codes  and the associated qualitative nature-related  impact and dependency ratings from ENCORE2  and SBTN3 to Barclays' internal sector  classifications. The mapping was undertaken for  sectors with material impacts and dependencies as  identified by TNFD in its Guidance for Financial  Institutions4.  We then undertook an exploratory exercise which  highlighted in which of these industry sectors  particular nature-related impacts and  dependencies are most likely to occur. | This work created a heatmap with ratings  representing an average global view of the  potential impacts and dependencies that may  be associated with the direct operations of  companies in these sectors.  The preliminary heatmap analysis highlighted  that, for most of the priority industry sectors,  there are a number of potential impacts and  dependencies rated as high or very high,  including impacts related to land-use change,  water use and pollution, as well as  dependencies on ecosystem services such as  ground and surface water, climate regulation  and flood-storm protection. These insights will  be used to help inform our future analysis,  taking into account that this represents one  data source, and specific nature related risks  within the same sector might vary substantially  from company or project and an aggregated  heatmap is not necessarily representative of  the actual impacts and dependencies of  Barclays’ client base.  Our proposed next steps include building on  the TNFD LEAP pilot undertaken in 2022/2023  to conduct further sector-level analysis, taking  into account the results of the heatmap,  Barclays’ exposure and client base and  emerging thinking on impact and risk data and  methodologies. |  |
|  |  |  |  |

Notes:

1 Source: tnfd.global/wp-content/uploads/2023/08/Recommendations\_of\_the\_Taskforce\_on\_Nature-

related\_Financial\_Disclosures\_September\_2023.pdf?v=1695118661

2 ENCORE stands for Exploring Natural Capital Opportunities, Risks, and Exposure and is a tool developed by Global Economy, UNEP-FI, and UNEP-

WCMC.

3 SBTN stands for Science Based Targets Network and builds on the momentum of the Science Based Targets initiative helping companies set

science-based targets for nature.

4  Source: tnfd.global/wp-content/uploads/2023/08/Guidance\_for\_Financial\_Institutions\_v1.pdf

Nature-related data, models and methodologies are a nascent area and therefore evolving and reliant on externally sourced data mapped to

internal sector identifiers, with various limitations. We will continue to review the applied data, models, and methodologies, as such the results

of similar assessments are likely to change in the future.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 69 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk and opportunities (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (a) |

|  |  |
| --- | --- |
|  |  |
|  |  |
|  | Climate-related opportunities  identified over the short, medium  and long term |
|  |  |
|  |  |
|  | Barclays has enhanced its focus on sustainable  and transition finance over the last two years.  At the end of 2022, we announced a new target  to facilitate $1trn of Sustainable and Transition  Finance. This followed a review of the financing  requirements arising from the global transition  to a low-carbon economy if the world is to  avoid the worst effects of climate change and  the potential addressable market for Barclays.  During 2023 we built on this work to develop a  Group-wide sustainable finance strategy to  operationalise our ambition. |
|  |  |

The market opportunity

We recognise the opportunities arising from the

global transition to a low-carbon economy –

which will involve scaling up zero or near-zero

emitting technologies and businesses and

supporting emissions reductions in high-emitting

and hard-to-abate sectors if the world is to avoid

the worst effects of climate change.

In 2022, we completed a review of the market

and identified three medium-term thematic

areas of potential opportunity for Barclays, as

outlined below. Although markets may have

evolved during 2023 we believe these still

represent growth opportunities for Barclays.

Energy Transition Finance

The analysis indicated that, based on current

policy, technology and market developments,

Energy Transition Finance – including renewables

and nascent or early-stage climate technologies

that are needed to scale to support the transition

to net zero – represents an estimated 10-year

addressable opportunity of over $16trn across

North America, Europe and Asia Pacific

(excluding China).

This extends to up to $24trn over the same time

period if policy, technology and market

developments step up to deliver on net zero by

2050.

This consists of a number of mature and scaling

technologies with renewable energy (including

wind and solar) and low-emissions transport

(including electric vehicles, fuel cell electric

vehicles and mass transit) expected to make up

over half of the addressable market through to

2030. The analysis also indicated significant

longer-term opportunities in financing the

scaling of capabilities in nascent technologies

such as carbon capture utilisation and storage

(CCUS) and hydrogen solutions.

Sustainable finance instruments

Sustainable finance instruments represent an

estimated $3.5trn-6trn annual issuance

opportunity through to 2030 across North

America, Europe and Asia Pacific (excluding

China), with Europe  expected to remain the

primary market for ESG debt.

The analysis indicated that all ESG instruments

are expected to grow to 2030 with ESG debt

excluding green bonds and loans represents an

estimated 10-year $400-650bn cumulative

financing opportunity for Barclays based on our

global market share in sustainable finance

instruments.

Retail and business banking

Barclays UK  recognises   the  environmental and

societal benefits  – and the commercial

opportunities  – that can be delivered through

financing the UK economy's transition to net

zero.  Embracing the challenge of capturing

opportunities from the transition to a low-carbon

economy aligns with Barclays’ Purpose and

positions us to capitalise on the growing market

for sustainable finance.

Our 2022 market review indicated that, within the

UK, sustainable opportunities in retail and

business banking represent a $225-286bn

market opportunity by 2025, increasing to an

estimated $640bn-1trn by 2030.

According to our 2022 market review, Green

Home Mortgages represent the largest individual

market for Barclays UK by 2030. We are actively

exploring ways to unlock the decarbonisation of

homes at scale by developing secured and

unsecured lending for energy-efficiency-related

technologies. We are also exploring strategic

partnerships to provide customers and

businesses with financing and guidance to make

more sustainable choices. However, there are

significant dependencies for this opportunity to

be realised – namely customer demand, supply

chain maturity and policy intervention.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Assessing the market opportunity |  |
|  | To determine the addressable global market  for sustainable finance to 2030, Barclays'  2022 market review  leveraged widely used  and credible third-party sources including the  IEA, IRENA, Climate Bonds Initiative and the  IFC as well as Barclays' own industry, ESG and  market research. The analysis considered  the investment needed through to 2030 for  the world to align to net zero, including the  accelerated scenarios reflecting possible  policy and market developments. Having  determined the global addressable market,  Barclays developed scenarios for the Bank's  potential market for various asset classes,  product sets, technological sectors and  geographic markets, validated through  comparison with historic growth rates and  our projected share of the overall market. |  |
|  |  |  |

$1trn Sustainable and Transition

Financing Target

Following analysis of the market opportunity for

sustainable financing, together with a review of the

Group's capabilities, in December 2022 we

announced a new target to facilitate $1trn of

Sustainable and Transition Financing between 2023

and the end of 2030,

|  |  |
| --- | --- |
|  |  |
| + | Further details of Barclays' sustainable finance targets can  be found on page  [101](#i4be61753b7f243b19551b0bfbf3a2a0d_319) and further details on how Barclays'  products  and services are harnessing these opportunities  from page [107](#i4be61753b7f243b19551b0bfbf3a2a0d_334). |
|  |

We recognise that we must tackle the

decarbonisation of 'hard-to-abate' sectors that

are carbon intensive  – including through scaling

and commercialising new technologies such as

hydrogen and carbon capture.

During 2023 we developed a Transition Finance

Framework, which we announced in early 2024.

The Transition Finance Framework sets out the

criteria for the inclusion of transition financing in

our $1trn target. The inclusion of transition

financing reflects our recognition of the

importance of lending and facilitating funding and

investing in technologies and activities that

support GHG emission reduction (directly or

indirectly) in high-emitting and hard-to-abate

sectors.

|  |  |
| --- | --- |
|  |  |
| + | Further details of Barclays' Transition Finance Framework  can be found on page  [104](#i4be61753b7f243b19551b0bfbf3a2a0d_331). |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 70 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk and opportunities (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (a) |

Group sustainable finance strategy

Following the appointments of the  CIB Head of

Sustainable Finance in November 2022 and the

Barclays UK Head of Social Purpose and

Sustainable  Finance in January 2023, a significant

piece of work was undertaken to develop a Group

sustainable finance strategy, which was presented

to and discussed with the Board in July 2023.

This work built on the findings of the 2022 market

opportunity analysis and considered Barclays '

competitive strengths to identify strategic

opportunities in sustainable and transition finance

where we believe Barclays can differentiate itself

and best support our clients and the global

economy to accelerate the transition to net zero.

The strategy aligns with the climate and

environmental themes that were identified when

we announced our $1trn Sustainable and

Transition Financing target in December 2022 and

therefore underpins our plan to deliver

that ambition.

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
|  | Our strategy to deliver on our sustainable finance ambition | | | | |  |  |  |  |
|  | Three pillars where we can deliver for clients and stakeholders: | | | | | | | |  |
|  | Support UK net zero | |  | Leading climate tech partner | |  | Sustainable credit markets | |  |
|  |  |  |  |  |  |  |  |  |  |
|  | • Facilitate the flow of capital to consumers  and businesses  • Deliver on our social purpose agenda by  supporting the just transition | |  | • Facilitate the flow of capital to new and existing  technologies critical to the net zero transition  • Develop expertise and infrastructure financing  solutions for the deployment of new technologies  • Support climate tech companies across the lifecycle,  from startup to IPO | |  | • Leverage strength in credit markets to facilitate  clients’ transition plans  • Play a leading role in the creation of carbon and  biodiversity markets  • Unlock additional sources of capital, including  through securitisation, savings and investments | |  |
|  |  |  |  |  |  |  |  |  |  |
|  | Three sustainability themes where we can focus and differentiate: | | | | | | | |  |
|  | Decarbonise.png | Decarbonising  industry  Support SMEs and corporates across major  industries to decarbonise, deploy new  technology and manage their transitions |  | Food_Ststem.png | Contributing to a nature-  positive food system  Drive the evolution to sustainable  agriculture and foods, and facilitate  regenerative land use |  | Net_Zero.png | Supporting consumers on the path  to net zero  Provide financing to facilitate consumer  products to live and act sustainably, and  support consumer-oriented climate tech  and financing models |  |
|  |  |  |  |  |  |  |  |  |  |

In the development of the strategy, we identified

three sustainability themes which are important in

the journey towards a net zero and sustainable

future, where we see significant commercial

opportunity and where we believe we can focus

and differentiate:

1 Decarbonising industry

2 Contributing to a nature-positive food system

3 Supporting consumers on the path to net zero

We also identified three pillars of competitive

advantage for Barclays across those

sustainability themes, through which we believe

we can deliver for our clients by working

collectively across our different businesses:

1 Our strength in the UK

2  Our focus on being a leading partner to climate

technologies

3  The strength of our business across

sustainable credit markets

The graphic below provides a summary of the

themes and pillars. At the intersection of each

theme and pillar we are developing tailored

products and services for our clients and

customers to help them deliver on their

transition and sustainability objectives.

For example, with our focus on climate

technologies, we are supporting the development

of start-ups in targeted technologies and nature

from idea to IPO. We are also advising sustainable

and Agtech companies on areas such as raising

finance and M&A.

Through our sustainable finance strategy and our

$1trn Sustainable and Transition Financing target,

we have set out an ambition and approach that will

support our clients and customers in their

transition. Delivery of the strategy will require a

multi-year investment in our people and

capabilities, which we are now accelerating the

execution of.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Identifying nature-related  opportunities |  |
|  |  |  |
|  | Nature-related financing presents future  opportunities for the financial sector given  the capital requirements to address and  reverse nature loss: the biodiversity  financing gap is estimated to be $700bn per  year1. As we execute our sustainable  finance strategy, we aim to identify  opportunities to play a role in supporting  the financing of nature. |  |
|  |  |  |

|  |  |
| --- | --- |
|  |  |
| + | See section Financing nature on page  [105](#i4be61753b7f243b19551b0bfbf3a2a0d_18024) for details of  our approach. |
|  |

Note:

1 cbd.int/doc/c/e6d3/cd1d/daf663719a03902a9b116c34/

cop-15-l-25-en.pdf

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 71 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk and opportunities (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (a) |

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Implementing our climate strategy | | | | | | | | | | | |  |  |
|  |  |  | | | | | | | | | | |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | TCFD Strategy Recommendation A: |  |  |  |  | TCFD Strategy Recommendation B: |  |  |  |  | TCFD Strategy Recommendation C: |  |  |
|  |  | Describe the climate-related risks and  opportunities the organisation has identified over  the short, medium, and long term. |  |  |  |  | Describe the impact of climate-related risks and  opportunities on the organisation’s businesses,  strategy, and financial planning. |  |  |  |  | Describe the resilience of the organisation’s  strategy, taking into consideration different  climate-related scenarios, including a 2°C or  lower scenario. |  |  |
|  |  | [Risks and opportunities](#i4be61753b7f243b19551b0bfbf3a2a0d_250) | [66](#i4be61753b7f243b19551b0bfbf3a2a0d_250) |  |  |  | [Implementing our climate strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_259) | [72](#i4be61753b7f243b19551b0bfbf3a2a0d_259) |  |  |  | [Resilience of our strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_406) | [130](#i4be61753b7f243b19551b0bfbf3a2a0d_406) |  |
|  |  | [Risks](#i4be61753b7f243b19551b0bfbf3a2a0d_253) | [67](#i4be61753b7f243b19551b0bfbf3a2a0d_253) |  |  |  | [Achieving net zero operations](#i4be61753b7f243b19551b0bfbf3a2a0d_262) | [73](#i4be61753b7f243b19551b0bfbf3a2a0d_262) |  |  |  | Scenario analysis | [131](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061446) |  |
|  |  | [Opportunities](#i4be61753b7f243b19551b0bfbf3a2a0d_256) | [70](#i4be61753b7f243b19551b0bfbf3a2a0d_256) |  |  |  | Operational footprint dashboard | [75](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686060018) |  |  |  | Barclays’ resilience to climate scenarios | [132](#i4be61753b7f243b19551b0bfbf3a2a0d_16082) |  |
|  |  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_271) | [76](#i4be61753b7f243b19551b0bfbf3a2a0d_271) |  |  |  | Climate stress tests | [132](#i4be61753b7f243b19551b0bfbf3a2a0d_16082) |  |
|  |  |  |  |  |  |  | [Reducing our financed emissions](#i4be61753b7f243b19551b0bfbf3a2a0d_283) | [80](#i4be61753b7f243b19551b0bfbf3a2a0d_283) |  |  |  | 2023 Enhancements and beyond | [134](#ib4213872474249fd834c9b5748668ac3_2-1-1-1-2543322) |  |
|  |  |  |  |  |  |  | BlueTrackTM  dashboard | [88](#i4be61753b7f243b19551b0bfbf3a2a0d_12116) |  |  |  | Challenges and limitations | [135](#ic42a2c24620a4a25a4eb81cde6bc5f7a_2-1-1-1-2582708) |  |
|  |  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_289) | [89](#i4be61753b7f243b19551b0bfbf3a2a0d_289) |  |  |  | Macro-dependencies and objectives | [136](#i4be61753b7f243b19551b0bfbf3a2a0d_16064) |  |
|  |  |  |  |  |  |  | [Financing the transition](#i4be61753b7f243b19551b0bfbf3a2a0d_319) | [101](#i4be61753b7f243b19551b0bfbf3a2a0d_319) |  |  |  | [Important information/disclaimers](#i4be61753b7f243b19551b0bfbf3a2a0d_427) | [137](#i4be61753b7f243b19551b0bfbf3a2a0d_427) |  |
|  |  |  |  |  |  |  | [Sustainable finance dashboard](#i4be61753b7f243b19551b0bfbf3a2a0d_328) | [103](#i4be61753b7f243b19551b0bfbf3a2a0d_328) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_331) | [104](#i4be61753b7f243b19551b0bfbf3a2a0d_331) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Working with our clients](#i4be61753b7f243b19551b0bfbf3a2a0d_334) | [107](#i4be61753b7f243b19551b0bfbf3a2a0d_334) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Embedding climate and sustainability into our](#i4be61753b7f243b19551b0bfbf3a2a0d_379)  [business](#i4be61753b7f243b19551b0bfbf3a2a0d_379) | [121](#i4be61753b7f243b19551b0bfbf3a2a0d_379) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Just transition and nature and biodiversity](#i4be61753b7f243b19551b0bfbf3a2a0d_388) | [124](#i4be61753b7f243b19551b0bfbf3a2a0d_388) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Engaging with industry](#i4be61753b7f243b19551b0bfbf3a2a0d_397) | [126](#i4be61753b7f243b19551b0bfbf3a2a0d_397) |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Barclays' approach to public policy](#i4be61753b7f243b19551b0bfbf3a2a0d_400) | [129](#i4be61753b7f243b19551b0bfbf3a2a0d_400) |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

|  |  |
| --- | --- |
|  |  |
|  |  |
|  | Achieving net zero operations |
|  |  |
|  |  |
|  | Although financed emissions account for  the greatest proportion of our climate  impact, we have also continued addressing  our operational emissions – an important  factor in meeting our ambition to be a net  zero bank by 2050. |
|  |  |

Defining net zero operations

We define net zero operations as the state in

which we will achieve a GHG reduction of our

Scope 1, Scope 2 and Scope 3 operational

emissions1 consistent with a 1.5o C-aligned

pathway and counterbalance any residual

emissions.

We continue to review and develop our approach

to net zero operations as standards to

understand and define net zero evolve rapidly.

Net zero operations strategy

Our net zero operations strategy has two

components:

• Reduce our Scope 1 and 2 emissions through

energy efficiency, electrification of our

buildings and vehicles, renewable electricity

sourcing and replacing fossil-fuel-powered

infrastructure with low-emission alternatives

• Reduce Scope 3 operational emissions by

engaging with our key stakeholders, including

suppliers2 and colleagues, to track, manage

and reduce their GHG emissions – while

embedding net zero principles across our

policies and contractual requirements.

Progress to date

In 2023 we achieved our milestone3 of 50%

reduction of our Scope 1 and 2 location-based

GHG emissions ahead of 2030 – reducing these

emissions by 51%Δ. We continued to source

100%Δ renewable electricity4 for our global real

estate portfolio5 and continued to meet our 90%

Scope 1 and 2 market-based emissions

reduction target6 – reducing these emissions by

93%Δ.

Key contributors to our progress include global

real estate portfolio right-sizing7 and energy

efficiency programmes, as well as company

vehicles electrification, and our continued focus

on renewable electricity sourcing.

For our Scope 3 operational emissions, our focus

remained on engaging with our key stakeholders

and making data enhancements, particularly by

acquiring primary supplier data and evolving our

accounting methodology in line with industry

standards and best practice. We also continued

to pursue the integration of ESG considerations

and expectations into processes throughout the

procurement lifecycle.

We expect that our progress against our net zero

operations targets and milestones is likely to be

variable and non-linear. Our net zero operations

strategy is dependent on broader industry,

technological and regulatory changes that are

outside Barclays’ control and may affect our

ability to achieve our targets and milestones.

Further, as the accounting standards and data

underlying our net zero operations strategy

continue to evolve and be refined, this could

impact our metrics, targets and milestones.

Progress against our targets and milestones may

also be impacted by management decisions

based on key drivers unrelated to climate, for

example prudent risk management practices.

Our intent is to enhance data collection and

accuracy to help identify key contributors to our

impact, determine opportunities for

improvement, and support the integration of

sustainability into our business operations.

Notes:

Δ    2023 data subject to independent limited assurance under ISAE

(UK) 3000 and ISAE 3410. Current limited assurance scope and

opinion can be found within the ESG Resource Hub:

home.barclays/sustainability/esg-resource-hub/reporting-and-

disclosures/

1 We define our Scope 3 operational emissions to include supply

chain, waste, business travel and leased assets.

2 In this Achieving net zero operations section, when referring to

suppliers and supply chain, we are referring to Third-Party

Service Suppliers (TPSPs).

3 In this Achieving net zero operations section, a reference to a

"milestone” denotes an indicator we are working towards and

report against.

4 We maintained 100% renewable electricity sourcing for our

global real estate portfolio through instruments including green

tariffs (55%) and energy attribute certificates (EACs)(45%).

5 Global real estate portfolio includes offices, branches, campuses

and data centres.

6 In this Achieving net zero operations section, a reference to a

“target” denotes an indicator linked to our executive

remuneration.

7 By right-sizing, we are optimising our space and associated

resources for our operational needs.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 73 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 1 |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Our net zero operations approach | | | | | | |
| By the end of | Scope 1 and 2 | 2022 performance | 2023 performance | Scope 3 | 2022 performance | 2023 performance |
| 2025 | 100% renewable electricity sourcing for our global real  estate portfolio | 100% | 100%Δ | We intend to work towards the milestone2 of 70% of  our suppliers, by addressable spend9, having science-  based GHG emissions reduction targets4 in place | 47%5 | 57%5 |
| 90% reduction in our Scope 1 and 2 GHG emissions  (market-based against a 2018 baseline) | 91% | 93% Δ |
| 100% electric vehicles (EV) transition for UK company  cars | 55% | 88% |
| 2030 | 100% EV or ultra-low emissions vehicles (ULEV) for all  company cars | 24% | 42% | We intend to work towards the milestone2 of 90% of  our suppliers, by addressable spend9, having science-  based GHG emissions reduction targets4 in place | 47%5 | 57%5 |
| 50% reduction in our Scope 1 and 2 GHG emissions  (location-based against a 2018 baseline) | 43% | 51%Δ | We intend to work towards the milestone2  of 50% GHG  supply chain emissions reduction (against a 2018  baseline6) | 17%6 | 28%6 |
| 2035 | We intend to work towards the milestone2 of 115 kWh/  m 2 /year average energy use intensity across our  corporate offices | 260 kWh/m2/year1 | 228 kWh/m2 /year  (-27% against 2018  baseline) | We intend to work towards the milestone2 of 90%  diversion of waste from landfill, incineration and the  environment across key campuses7 | 49% 8 | 53% |
| We intend to work towards the milestone2 of 10 MW  on-site renewable electricity capacity installed across  our portfolio | 0.30MW3 | 0.40MW (<1% total  electricity use) |
| 2050 |  |  |  | We intend to work towards the milestone2  of 90% GHG  supply chain emissions reduction (against a 2018  baseline6) | 17%6 | 28%6 |
|  |  |  |  |  |  |  |
| Notes:  1 We have updated internal and external data which has resulted in minor updates to FY2022 EUI performance (a change from 265kWh/m2/year to 260 kWh/m2/year).  2 In this Achieving net zero operations section, a reference to a "milestone” denotes an indicator we are working towards and report against.  3 We have updated internal data which has resulted in minor updates to FY2022 on-site renewable electricity capacity (from 0.26MW to 0.30MW).  4 Targets are considered ‘science-based’ if they are in line with what the latest climate science deems necessary to meet the goals and timelines of the Paris Agreement – limiting global warming to well below 2°C above pre-industrial levels and pursuing efforts to limit warming to  1.5°C. The Science Based Targets initiative (SBTi), a partnership between CDP, the United Nations Global Compact, World Resources Institute (WRI) and the World Wide Fund for Nature (WWF), provides companies with independent assessment and validation of targets and is  currently the internationally accepted standard.  5 Indicative number provided to illustrate the number of suppliers by total addressable spend that have committed to or have science-based targets in place. In our 2022 Annual Report we reported 47% progress based on a review of our top 500 suppliers by addressable spend. Our  current progress is reported here based on a review of our top 2,000 suppliers by addressable spend.  6 Based on our indicative supply chain emissions inventory. DEFRA conversion factors – which Barclays uses to calculate spend data into supply chain emissions – were revised in 2023. These have been retrospectively applied to Barclays' 2018 baseline and 2022 disclosure, resulting  in an increased 2018 baseline and recalculated 2022 metrics. In FY 2022 we reported 8% reduction in our supply chain GHG emissions and due to the changes in the DEFRA conversion factors and updated internal data, we recalculated the 2022 figure to be 17%. As our suppliers  continue to develop the quality of emissions data for the goods and services we purchase, our reliance on spend data to calculate our emissions will reduce and the volume of primary data will increase.  7 Campuses include 1 Churchill Place, Radbroke, Northampton, Glasgow, Pune, Whippany, 745 7th Avenue, Dryrock.  8 Reported waste diversion performance for FY2022 has been recalculated from 65% to 49%, to account for an update in external data.  9 Addressable spend is defined as external costs incurred by Barclays in the normal course of business where Procurement has influence over where the spend is placed. It excludes costs such as regulatory fines or charges, exchange fees, taxation, employee expenses or litigation  costs, and property rent.  Please see ESG Data Centre for all recalculations and ESG Reporting Framework for our operational emissions accounting approach.  Δ  2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub: home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/. | | | | | | |

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 74 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 1 |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  | 2023 Operational GHG emissions by Scope (market-based) | Scope 3 categories | | |  |
|  |  | 1 | Category 1, 2 & 4 supply chain emissions | 84.9% |  |
|  |  | 3 | Category 3 fuel and energy-related activities | 2.1% |  |
|  |  | 5 | Category 5 waste generated in operations | 0.1% |  |
|  |  | 6 | Category 6 business travel | 6.1% |  |
|  |  | 7 | Category 8 upstream leased assets | 4.2% |  |
|  |  | 8 | Category 13 downstream leased assets | 0.1% |  |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  |  |  |  |  |  |

|  |
| --- |
|  |
| Total GHG emissions by Scope  (location-based) '000 tonnes CO2 e |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| 2023 |  | 15.3△ |
| 2022 |  | 20.2 |
| 2021 |  | 23.2 |
| 2020 |  | 22.7 |
| 2019 |  | 27.3 |
| 2018 |  | 29.0 |

![39]()

|  |
| --- |
|  |
| 735.8Δ |
| 815.8 |
| 824.6 |
| 220.3 |
| 300.0 |
| 1019.5 |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| n | Scope 1 | n | Scope 2 (location-based) | n | Scope 3 | Total |

|  |
| --- |
|  |
| Total GHG emissions by Scope  (market-based) '000 tonnes CO2e |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| 2023 |  | 15.3△ |
| 2022 |  | 20.2 |
| 2021 |  | 23.2 |
| 2020 |  | 22.7 |
| 2019 |  | 27.3 |
| 2018 |  | 29.0 |

![41231686042296]()

|  |
| --- |
|  |
| 650.2Δ |
| 718.0 |
| 716.8 |
| 119.8 |
| 209.4 |
| 1115.1 |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| n | Scope 1 | n | Scope 2 (market-based) | n | Scope 3 | Total |

|  |
| --- |
|  |
| Total energy use  (MWh) |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |
| 2020 |
| 2019 |
| 2018 |

![41231686042310]()

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| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Notes  1 Our reporting of supply chain emissions includes the following GHG Protocol Scope 3 categories: Category 1: Purchased Goods and Services, Category 2: Capital Goods, Category 4: Upstream transportation and distribution. In 2023 we reported  GHG emissions of Categories 1, 2 and 4 by aggregating these under Category 1. It is our intent to assign emissions to each of these separate categories in due course.  2 The methodology used to calculate our GHG emissions follows the 'Greenhouse Gas Protocol (GHG): A Corporate Accounting and Reporting Standard (Revised Edition)', defined by the World Resources Institute/World Business Council for  Sustainable Development. We have adopted the operational control approach on reporting boundaries.  3 We continuously review and update our performance data based on updated GHG emission factor, improvements in data quality and updates to estimates previously applied. For 2023, we have applied the latest emissions factors as of 31 December  2023. All location- and market-based figures are gross and do not include netted figures from carbon credits.  4 Upstream and downstream leased assets include our third-party co-located data centres and a property we lease out to tenants. Upstream leased assets also include properties with landlord managed energy from central systems which are outside  of our operational control.  5 We selected 2018 as the baseline year for our supply chain emissions, to align with the baseline year used for other categories, and have since reported supply chain emissions for 2021, 2022, and 2023.  6 Reported emissions for Scope 2 location and market-based have been recalculated back to the 2018 baseline, due to updated internal and external data. The associated emissions have also been re-classified from Scope 2 electricity to Scope 3  Category 8 (Upstream Leased Assets) as these emissions are currently outside of our operational control. In 2022 we reported Scope 2 location-based emissions of 103,422 tCO2e; the recalculated figure is 99,782 tCO2e. In 2022 we reported Scope  2 market-based emissions of 1,883 tCO2e; the recalculated figure is 1,963 tCO2e. In 2022 we reported energy use of 467,939 MWh; the recalculated figure is 463,973 MWh.  7 We have recalculated FY 2022 Scope 3 Category 5 GHG emissions from 10,700 tCO2e to 352 tCO2e as DEFRA Material Use emission factors were incorrectly applied to waste production which resulted in an overstatement of emissions.  Our operational footprint data follows a reporting period of 1 October 2022 to 30 September 2023.  Δ  2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub: home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/. |  |  |  |  |
|  |  | ESG Data Centre  See our ESG Data Centre for further  details of our operational GHG  emissions since 2018, including our  Scope 1, 2 location- and market-  based and Scope 3 operational  emissions data. For more  information on our operational  emissions accounting approach  please see the 2023 ESG Reporting  Framework. |  |
|  |  |  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 75 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |
| Operational footprint dashboard | | | | | | | | | | |

![41231686041601]()

![41231686041735]()

![Gradient_operatonal footprint.png]()

|  |  |
| --- | --- |
|  |  |
| 43.5 | 53.7 |
| 73.8 | 108.3 |

market-based

Reducing our Scope 1 and 2 emissions

In 2023, to reduce our Scope 1 and 2 emissions,

we maintained focus on improving energy

efficiency and replacing fossil-fuel-powered

infrastructure with lower-emission alternatives.

Energy efficiency measures reduce our overall

energy demand and reliance on the grid to power

our operations. Concurrently, by replacing fossil-

fuel-powered infrastructure, for example, by

electrifying our buildings and company vehicles,

we will aim to eliminate a significant part of our

Scope 1 emissions and prepare our

infrastructure to consume electricity from

renewable sources.

Increasing energy efficiency

To continually improve operational energy

efficiency, in 2023 we maintained global demand

reduction programmes and right-sized1 our

global real estate portfolio – resulting in 44%

energy consumption reduction against a 2018

baseline. These efforts also contributed to

progress against our global corporate offices,2

energy use intensity (EUI) milestone by reducing

our EUI by 27% against a 2018 baseline.

Our global energy optimisation programme

contributed to our EUI reduction by adjusting

corporate offices' settings and systems during

periods of low or no occupancy to reduce our

demand for energy while keeping our buildings

running. In 20233 the programme contributed to

approximately 9.1 GWh in energy savings at our

UK corporate offices – equivalent to the annual

electricity consumption of approximately 2,600

UK households. Programme projects included

Glasgow campus baseload4 reductions, where

we reduced overnight usage of building

equipment such as our lighting, heating and

cooling systems, and power reductions for our

building equipment at 1 Churchill Place in

London, planned over bank holidays. Moving

forward, we plan to implement the energy

optimisation programme at additional

corporate offices.

Electrification and replacing fossil-fuel-

powered infrastructure

In 2023 we continued electrifying our real estate

portfolio by replacing end-of-life natural gas

heating and cooling equipment with electric-

powered alternatives and prioritising

electrification in campus developments

wherever possible, For example, at our Glasgow

campus we replaced natural gas boilers with an

air source heat pump – leading to an 84%

reduction in Scope 1 GHG emissions compared

to 2022 at that campus. As part of the campus

redevelopments at 1 Churchill Place, we are

electrifying our kitchen cooking stoves. We will

continue to incorporate electrification and fossil-

fuel-powered infrastructure replacement into

future real estate decisions.

As part of our commitment to Climate Group's

EV100 initiative, we have also made progress in

transitioning our corporate vehicle fleet to

electric vehicles (EVs) or ultra-low emissions

vehicles (ULEVs). By the end of 2023 88% of our

UK fleet was converted to EVs and 42% of our

global fleet was converted to EVs or ULEVs.

All UK colleagues provided with a company car

for their role have also been offered funded

home-charging equipment to ease the transition

to a fully electrified fleet.

In addition, we are replacing existing mobile

banking vans with electric vans, providing a less

carbon-intensive method of serving our Barclays

UK customers and communities compared to

the previous diesel-fuelled vehicles.

Replacing fossil fuels

with renewable energy

In 2023 we maintained 100%Δ renewable

electricity sourcing for our global real estate

portfolio through instruments including green

tariffs5 (55%) and energy attribute certificates6

(EACs)(45%), continuing to meet our 2025 target

ahead of schedule.

We also maintained our long-term focus on

planning additional on-site renewable energy

installations and exploring tools like Power

Purchase Agreements (PPAs) that bring

additional renewable energy to the grid.

We continued developing strategies for on-site

renewable energy installations such as solar

panels, and have coordinated with stakeholders

like local utilities and planning boards with the

intent of installing these types of projects in

coming years. Sites with existing solar panel

installations, including Glasgow, Pune,

Northampton and Cambridge Eagle Lab, have

0.40 MW of renewable electricity capacity.

Beginning in 2024, up to 80%7 of Barclays' annual

UK electricity needs will be sourced through a

PPA supporting Creag Riabhach, an onshore

wind farm project in Scotland.

Scope 1 and 2 emissions data accounting

We continue to work on improving our data

quality and accounting methodologies to make

meaningful comparisons of emissions data over

time and to make informed strategic decisions.

Given the evolving nature of climate data and

methodologies, past-period figures may change

to reflect updates. To manage the impact of

these changes we have detailed our operational

climate data accounting approach in the ESG

Reporting Framework on our ESG Resource Hub.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Embedding sustainability into operational  practices |  |
|  | Across our operations we are introducing new  standards and guidelines to help enable the  integration of sustainability into decision  making.  For example, in 2023 we introduced the  Sustainability Design and Construction  Checklist and Green Leasing Toolkit, which  are guidelines that help integrate sustainability  criteria into real estate processes in alignment  with Barclays' net zero operations strategy.  Both guidelines help teams identify gaps in  existing real estate processes for leasing  transactions and in design and construction  projects. They serve as a record of inclusion  and applicability of sustainability criteria for a  given project, allowing teams to flag  inconsistencies between project design and  sustainability expectations. |  |
|  |  |  |

Notes:

1 By right-sizing we are optimising our space and associated

resources for our operational needs.

2 Corporate offices include offices and campuses.

3 Data represents reduction from 1 October 2022 to

30 September 2023.

4 Baseload is the minimum load experienced by a building energy

system over a given period of time, that must be supplied at all

times.

5 Green tariffs are programmes in regulated electricity markets

offered by utilities, allowing large commercial and industrial

customers to buy bundled renewable electricity from a specific

project through a special utility tariff rate.

6 Energy attribute certificates are the official documentation to

prove renewable energy procurement. Each EAC represents

proof that 1 MWh of renewable energy has been produced and

added to the grid. Global EAC standards for renewable claims are

primarily Guarantees of Origin in Europe and UK,Renewable

Energy Certificates (RECs) in North America and International

RECs (I-RECs) in a growing number of countries in Asia, Africa,

the Middle East and Latin America.

7 Figure has been estimated using 2022 UK real estate property

portfolio electricity consumption as a reference.

Δ    2023 data subject to independent limited assurance under ISAE (UK)

3000 and ISAE 3410. Current limited assurance scope and opinions

can be found within the ESG Resource Hub: home.barclays/

sustainability/esg-resource-hub/reporting-and-disclosures/.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 76 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 1 |

Addressing our Scope 3 operational

emissions

Supply chain

To support our net zero operations strategy, in

2023 we continued to implement our supply

chain net zero pathway.

As part of our pathway we are working towards a

50% reduction in our supply chain GHG

emissions by end of 2030 and a long-term

milestone of 90% emissions reduction by the

end of 2050 (both against a 2018 baseline). In

developing our supply chain net zero emissions

pathway, we used the Science Based Targets

initiative (SBTi) Corporate Net Zero Standard and

Target Setting Tool, consistent with a 1.5ºC-

aligned pathway.

Engagement and integration

Engagement with our suppliers is a key vehicle for

change. Our strategy is to engage proactively and

constructively across our supplier organisations to

increase climate transparency and accountability,

and promote emissions reduction. In 2023 we

invited 489 of our suppliers to disclose climate-

related information such as governance, risk

strategy, targets and performance, emissions

methodology and data related to climate change,

through CDP. We achieved a 75% participation

rate, representing approximately 75% of Barclays'

2023 supply chain emissions.

In 2022 we updated our standard supplier contract

terms with requirements relating to climate

change, including an obligation for our suppliers to

have an emissions reduction programme in place

by 2025, supported by a public reduction target

and a commitment to achieve net zero GHG

emissions no later than 2050. In 2023 we

continued to embed the discussion and

negotiation of these terms into new contracts and

renewals. This is one of the steps we are taking to

work towards our milestone of 90% of our

suppliers, by addressable spend, to have science-

based GHG emissions reduction targets in place

by end of 2030. The terms also include a

requirement for our suppliers to periodically

disclose their direct and indirect GHG emissions

using a recognised standard, such as the GHG

Protocol Corporate Accounting and Reporting

Standard.

We have also continued to work internally with

our Sourcing colleagues to embed the

consideration of GHG emissions into some of

our key tenders for Supplier and Product

selection. We are starting to embed the

consideration of GHG emissions at the point of

demand through seeking less-GHG-emission-

intensive ways of meeting our needs. For

example, the procurement process for capital

projects now integrates sustainability into

building design principles through embedding a

Sustainability Design and Construction Checklist

(see page [76](#i4be61753b7f243b19551b0bfbf3a2a0d_271) for more information).

Lastly, to support our engagement with

suppliers, in 2023 we conducted an intelligence

gathering exercise across our top 2,000 suppliers

(based on spend1) to seek understanding of their

position on environmental and social matters.

Data enhancement

Our strategy to achieve our milestones is

underpinned by obtaining more accurate

emissions data from our suppliers, to inform our

approach to reducing emissions. Ultimately, we

are reliant on our suppliers to provide accurate

product-level primary data, in addition to

reducing GHG emissions associated with the

goods and services we purchase from them, to

achieve emissions reductions across their own

organisations. To measure progress towards our

emissions reduction milestones and inform our

supplier intervention strategy, reliable primary

GHG emissions data will need to be collected and

tracked over time across our supplier

organisations. In 2022 primary data accounted

for approximately 15% of our supply chain

emissions inventory, increasing to 27% in 2023.

We understand that our success depends on

that of our suppliers, and that progress may be

variable and non-linear. Geographic

considerations, resource capacities, data

availability, legal requirements, market conditions

and the varying transition pathways individual

companies take, given the technologies available,

may all affect the speed at which they can reduce

emissions.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Supply chain baseline |  |
|  | DEFRA conversion factors – which Barclays  uses to calculate spend data into supply chain  emissions – were revised in 2023. These have  been retrospectively applied to Barclays' 2018  baseline and 2022 supply chain emissions,  resulting in an increased 2018 baseline and  revised 2022 figures. Our 2022 performance  against supply chain milestone2 increased  from 8% to 17% due to the change in the  DEFRA conversion factors and updated  internal data. As our suppliers continue to  develop the quality of emissions data for the  goods and services we purchase, our reliance  on spend data to calculate our emissions will  reduce and the volume of primary data will  increase. |  |
|  |  |  |

Notes

1 In this section, when referring to 'spend', this is addressable

spend, defined as external costs incurred by Barclays in the

normal course of business where Procurement has influence

over where the spend is placed. It excludes costs such as

regulatory fines or charges, exchange fees, taxation, employee

expenses or litigation costs, and property rent.

2 Milestones referred to include: 'By end of 2030 we intend to work

towards the milestone of 50% GHG supply chain emissions

reduction (against a 2018 baseline).' and 'By end of 2050 we

intend to work towards the milestone of 90% GHG supply chain

emissions reduction (against a 2018 baseline)'.

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 77 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 1 |

Business travel

In 2023 we continued engaging with our

stakeholders and colleagues to provide

information and tools to encourage more

sustainable travel choices. For example, we

updated our booking and reporting platforms to

highlight low-carbon modes of transport for our

colleagues, including EV rentals where available.

We provided colleagues with additional guidelines

illustrating how they can reduce their travel

emissions – identifying, for example, where they

could combine multiple trips or switch from air to

rail travel. We also continued to engage with our

preferred airline partners to explore their plans to

use sustainable aviation fuel (SAF).

Our 2023 total colleague business travel

emissions reduced by 43% against a 2018

baseline – noting these emissions doubled

compared to 2022 due to a return to business

travel post-COVID. We will continue to engage

with our stakeholders and provide colleagues

with the tools and resources to align with our net

zero ambition. Our intent is to improve the

accuracy of our business travel data to better

inform emission reduction strategies.

Leased assets and waste

While our leased assets and waste emissions are

lower than other operational emissions, we are

pursuing opportunities to reduce them.

For example, in 2023 we introduced a Green

Leasing Toolkit to support engagements with

landlords by encouraging the inclusion of our

sustainability criteria throughout the leasing real

estate lifecycle. The toolkit includes guidance

and preferred contractual language for lease

preferences.

We are also embedding circular economy

principles within our operations. Further details

are provided on page [79](#i4be61753b7f243b19551b0bfbf3a2a0d_18002).

Carbon credits

We are currently reviewing our approach to the

use of voluntary carbon market credits for

operational emissions.

We remain supportive of initiatives to enhance

the integrity of the voluntary carbon market

across both the supply and demand side.

Supporting our colleagues

Our goal is to provide colleagues with the tools and

support needed to help reduce their individual

environmental footprints.

In 2023, for example:

• We continued to expand our range of green

benefits for colleagues, including our UK EV salary

sacrifice and UK and Ireland Bike4Work schemes.

In 2023 over 900 colleagues ordered EVs through

salary sacrifice and over 650 made use of

Bike4Work

• Officially launched in 2022, our Barclays Go Green

sustainability gamification programme helps

colleagues take and track actions that reduce

their personal environmental footprint. In 2023,

colleagues participated in over 20,000 activities –

such as switching off laptop equipment, opting

for lower-carbon travel methods and replacing

single-use items like cups with reusable

alternatives

• Our 14 global employee-led environment

networks created and participated in activities

aligned with Barclays’ climate and sustainability

strategy.

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| + | Further information about how Barclays engages with  colleagues can be found on  page  [122](#i4be61753b7f243b19551b0bfbf3a2a0d_385) . |
|  |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 78 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

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| TCFD Strategy Recommendation (b)  |  Strategic Pillar 1 |

Nature and biodiversity

in our  operations

Nature and biodiversity are intrinsically

connected to our efforts to mitigate and adapt

to climate change, maintain healthy communities

and support productive, sustainable economies.

At the end of 2023 we started to identify and

assess nature-related impacts and

dependencies for our real estate operations

informed by the Taskforce on Nature-related

Financial Disclosures (TNFD) LEAP (Locate,

Evaluate, Assess, Prepare) approach. This

evaluation includes assessing our real estate

operations' water, pollution, biodiversity and

resource use impacts and dependencies. We will

continue the assessment in 2024 to evaluate

nature considerations in our operations moving

forward.

The assessment will support our focus on

improving resource use and the ability to protect

natural environments through circular design

principles  – including designing-out waste and

pollution across our operations, recycling, and

regenerating natural ecosystems.

Circular economy principles and zero waste

We are working to embed circular economy

principles  across our operations by seeking to

eliminate waste at the source through resource

use reductions and by improving recycling rates.

Across our key campuses1 we have an ambition

to achieve and maintain TRUE (Total Resource

Use and Efficiency) zero waste certified projects

by end of 2035 with a milestone to divert 90% of

waste from landfill, incineration and the

environmen t by end of 2035 – and in 2023

achieved a 53% diversion rate of all waste, a 4%

increase from the previous year2. Even though

more colleagues have returned to work in our

office locations, causing the total tonnage of

waste to increase since 2022, the waste

diversion rate from landfill and incineration has

improved.

This result illustrates that, while more waste has

been created, we are diverting more of it through

increased waste segregation and reduced waste

stream contamination – as well as through the

introduction of more reusable items in our

campuses.

For example, at our Glasgow and Pune campuses,

we have increased waste segregation streams –

making it easier for colleagues to put the correct

waste in the correct bin. The increased waste

segregation streams resulted in an average

contamination rate of 14% between Pune and

Glasgow, compared to our average of 45% at key

campuses where these solutions have not yet

been implemented. The overall reduction in

contamination rates supports our recycling rates

– and, ultimately, our waste diversion milestone.

In addition, we are working to divert food waste

from landfill and incineration through projects

including the installation of on-site composters

at our Glasgow and Pune campuses and the

creation of commercial food waste collection

points at various office locations.

In 2023 we also launched our reusable food and

beverage dishware programmes across four key

campuses with the aim to reduce single-use

items and therefore waste.

Pollution management

Barclays has controls in place to address

pollution risks across our property portfolio

globally where we operate generators and store

diesel. The pollution risk controls are engineered

to identify possible pollution sources and

pathways for an uncontrolled release to cause

environmental harm, assess mitigation measures

and identify improvements and actions that can

be taken to further enhance our pollution

prevention and mitigation measures.

In 2023, 41% of our global real estate portfolio

remains certified to ISO 14001, the international

standard for designing and implementing an

Environmental Management System (EMS).

|  |  |  |
| --- | --- | --- |
|  |  |  |
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|  | Unreasonable Impact company Re:Dish powering  sustainable solutions for Barclays |  |
|  |  |  |
|  | Re Dish.jpg |  |
|  |  |  |
|  | After receiving support from Barclays through the Unreasonable Impact programme, Re:Dish has  brought its reusable dishware programme full circle to Barclays’ New York City, Wilmington and  Whippany campuses.  As part of our ambition to become a net zero bank by 2050, Barclays is working to achieve and  maintain TRUE (Total Resource Use and Efficiency) zero-waste-certified projects across key  campuses by 2035.  Re:Dish supports our goal by helping us remove hundreds of thousands of single-use items a year  from our waste stream. Re:Dish delivers food and beverage containers to Barclays, collects used  containers and cups to clean and sanitise, and returns them for reuse. Instead of requiring more  materials and resources for new containers and specialised cleaning equipment, Barclays taps into  an existing network of fit-for-purpose dishware and washing services that can efficiently  accommodate fluctuating demand.  In addition, Re:Dish and Barclays partnered to build colleagues’ understanding of circularity – an  important contributing factor to the success of these programmes. Re:Dish containers have a QR  code colleagues can scan to see exactly how many times that specific unit has been reused and the  resulting estimated environmental impact.  To learn more about Unreasonable Impact partnerships, see page [110](#i4be61753b7f243b19551b0bfbf3a2a0d_349). |  |
|  |  |  |

Note

1 Key campuses include 1 Churchill Place, Radbroke, Northampton,

Glasgow, Pune, Whippany, 745 7th Avenue, Dryrock.

2 Reported waste diversion performance for FY2022 has been

recalculated from 65% to 49%, to account for an update in

external data.

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|  | Further details on Barclays’ approach to biodiversity can be  found on  page [124](#i4be61753b7f243b19551b0bfbf3a2a0d_391)  . |
| + |
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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 79 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 1 |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Reducing our financed emissions |  |
|  |  |  |
|  | We are committed to aligning all of our  financing to the goals and timelines of the  Paris Agreement, consistent with limiting the  increase in global temperatures to 1.5°C. To  meet our ambition, we need to reduce the  client emissions we finance – not just for  lending but for capital markets activities, too. |  |
|  |  |  |

We work closely with our clients to ensure that

over time the activities we finance are aligned to

the goals and timelines of the Paris Agreement.

Consistent with our Purpose, and taking into

account considerations of all relevant business

factors, we continue to set emissions reduction

targets for our portfolios where possible, aligned

with the ambitions of the Net-Zero Banking

Alliance (NZBA), of which we are a founding

member. We also continue to set and follow clear

restrictions on financing certain activities.

|  |  |
| --- | --- |
|  |  |
| + | Further details on our restrictive policies can be found on  page [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720). |
|  |

The core building block for developing the transition

framework for Barclays to be a net zero bank is our

ability to estimate the full in-scope balance sheet

financed emissions.

1 In 2020, we developed our BlueTrackTM

methodology to measure and track our progress

against our financed emissions, setting targets

for Energy upstream and Power generation

initially.

2 As of 2022, we had reported the baseline

financed emissions for five sectors covered

under BlueTrackTM where we have set reduction

targets as well as UK Residential Real Estate

where we set a convergence point.

3 In 2023, we have further extended the scope of

our calculations to cover the full in-scope balance

sheet financed emissions based on methodology

which has been developed using the PCAF

Standard and have expanded the scope of

BlueTrackTM to set reduction targets for three

new sectors - Agriculture, Aviation and UK

Commercial Real estate. Additionally, we have

expanded the scope of our UK Residential Real

Estate1 convergence point.

Hence, we are pivoting our approach to disclosing

our financed emissions across two sections:

1 Estimating the full in-scope balance sheet

financed emissions using a methodology which

has been developed using the PCAF Standard2.

The data reported in this section of the Annual

Report (up to page [83](#i4be61753b7f243b19551b0bfbf3a2a0d_19986)) is as at December 2022.

Hence, these numbers follow a lag of one year

when compared to other climate-related

disclosures based on December 2023 in this

report, due to the lead time required to fully

analyse our entire in-scope exposures.

2 Continuing to use the BlueTrack™ methodology

to assess financed emissions for material sectors

and set 2030 targets integrating 1.5°C scenarios.

This data is being reported as at December 2023.

Note

1 For further details please see page [98](#i4be61753b7f243b19551b0bfbf3a2a0d_298).

2 PCAF Standard - PCAF (2022). The Global GHG Accounting and

Reporting Standard Part A: Financed Emissions. Second Edition.

Estimating the full in-scope balance sheet

financed emissions

Scope

We have identified the scope of coverage using a

methodology which has been developed using

the PCAF standard.

We have included undrawn commitments,

contingent liabilities, and capital

markets  financing .

We have calculated financed emissions for c.

£779bn of Barclays' activity as at December 2022

(of which £428bn are on-balance-sheet

exposures) which is set out in further detail in the

following table.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Identification of in-scope exposure to calculate financed emissions  (as at December 2022) | | |
| Category | Value  (as at Dec 2022)  in £m | Comments |
| Total Barclays balance sheet | 1,513,699 |  |
| Exclusions: |  |  |
| Cash and bank balances,  Cash collateral and settlement balances,  Derivative financial instruments,  Goodwill and intangible assets,  Current tax assets, Deferred tax assets, Other assets,  Trading portfolio assets (including drawn loans),  Retail lending (personal lending, retail cards) and  Reverse repos | (-)1,076,980 | Exposures excluded  by the PCAF Standard. |
| Property, plant and equipment | (-)3,616 | Emissions covered under  Barclays Scope 1 and Scope 2. |
| Retirement benefit assets | (-)4,743 | Emissions on Barclays Bank UK  Retirement Fund reported  separately as part of  Task Force on Climate-related  Financial Disclosures Report 2022. |
| Total Barclays exposure in scope for computing  financed emissions | 428,360 |  |
| Inclusions: |  |  |
| Total in-scope undrawn commitments and  contingent liabilities | (+)246,030 | We have gone beyond the scope of  PCAF’s definition of asset classes to  additionally cover undrawn  commitments and contingent liabilities.  We have excluded exposures for which  PCAF is yet to establish a methodology  (personal lending, retail cards and  Trading balances) from our total undrawn  commitments and contingent liabilities. |
| Capital markets financing (33% of Barclays share) | (+)104,734 | Equity holdings, bond issuances, equity  issuances, syndicated loans. |
| Total Barclays' activities considered  for financed emissions calculations | 779,124 |  |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 80 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

Basis of preparation

Our approach for calculating financed emissions

is based on a methodology which has been

developed using the PCAF Standard with the

following key exceptions:

1 We have gone beyond the scope of PCAF’s

definition of asset classes to additionally cover

undrawn commitments, contingent liabilities

and capital markets financing activities. For

instance, in the case of a loan we consider the

committed amount (both drawn and undrawn),

as opposed to just outstanding amounts

(which is the approach preferred by PCAF) for

calculating financed emissions.

2 We have also consistently used the book value

of equity and debt for all clients to calculate the

attribution factor, while PCAF recommends

using the Enterprise Value Including Cash

(EVIC) for listed entities.

3 PCAF recommends calculating emissions at a

client level. For certain sectors, clients could

have presence in activities across multiple

parts of the value chain and in such cases

reported emissions may not be consistent and

reliable to estimate financed emissions. To

overcome this challenge we calculate

emissions at an activity level, using a range of

options aligned to the PCAF Standard's

guidance to calculate client emissions.

For certain activities – including fossil fuel

exploration and production, electric power

generation and automotive manufacturing – we

employ asset-level production data to estimate

client emissions. For activities such as cement

and steel production, we use client-reported

emissions. Where we do not have sufficient data

on reported emissions or physical activities – for

example in relation to mortgages where we do

not have EPC data available – we use fall-backs

based on emission factors.

For an immaterial part of our balance sheet

(c. 1%), where the appropriate sector fall-backs

could not be reliably obtained, we have used the

overall portfolio average economic emissions

intensity to estimate emissions.

|  |  |
| --- | --- |
|  |  |
| + | Our Financed Emissions Methodology paper (published in  2024) provides more details of our methodology and can be  found within the ESG Resource Hub:  [home.barclays/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [sustainability/esg-resource-hub/reporting-and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/) |
|  |

Emissions coverage

We have computed our overall financed

emissions based on Scope 1 and Scope 2 of our

clients’ emissions as at December 2022. Hence,

these numbers follow a lag of one year when

compared to other disclosures based on

December 2023 in this report. The lag of one

year is due to the lead time required to fully

analyse our entire in-scope exposures.

We have excluded our clients’ Scope 3 emissions

from these calculations except for activities

where we have set a target on Scope 3 emissions

– which includes Energy Upstream, Automotive

manufacturing LDVs, Aviation and UK

Agriculture. - Livestock and Dairy Farming. This is

due to challenges in sourcing reliable and

consistent data, not just on reported Scope 3

emissions but also the fall-back emission factors

for downstream emission estimations. As we

refine our approach and data sourcing strategy,

we will assess the suitability of including Scope 3

emissions in our financed emissions disclosures.

Aligned to the guidance issued by the NZBA, our

metrics and targets for all sectors capture

emissions on a CO2e basis. For activities where

we have set targets, we have assessed which

GHGs are relevant and material for the

respective sector.

Results

Barclays has assessed the extent to which the

business is aligned to a well-below 2 oC pathway

by calculating an estimate of our financed

emissions for the full in-scope balance sheet as

at December 2022, which has enabled us to

calculate the coverage of our financed emissions

reduction targets across our portfolio (including

integration of 1.5°C aligned scenarios and ranges

for certain sectors to reflect dependencies

outside our control that will determine how

quickly our financed emissions can be reduced in

these sectors).

Our estimation of our overall financed emissions

indicates a total annual Scope 1,2 emissions of

c.80MtCO2e for FY2022. Among these, we have

set 2030 financed emissions targets covering

our clients’ Scope 1,2 emissions (including

integration of 1.5°C aligned scenarios and ranges

for certain sectors and including UK Housing for

which we have set a convergence point) for 55%

of our full in-scope balance sheet financed

emissions. Beyond this we have also set 2030

targets integrating a 1.5°C aligned scenario

covering Scope 3 emissions for Energy

Upstream, Automotive manufacturing LDVs,

Aviation and UK Agriculture – Livestock and Dairy

Farming.

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 81 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

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| --- | --- | --- | --- | --- | --- | --- |
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| Financed emissions for activities with 2030 targets integrating 1.5°C scenarios (as at December 2022) | | | | | | |
| Activities | Scope 1,2 emissions (MtCO2 e) | | | Scope 3 emissions (MtCO2 e) | | |
| On-balance-sheet lending | Undrawn commitments and  contingent liabilities | Capital markets financing | On-balance-sheet lending | Undrawn commitments  and contingent liabilities | Capital markets financing |
| Activities with 2030 targets integrating 1.5°C scenarios as at December 2022 | | | | | | |
| Automotive manufacturing (LDV) | 0.0 | 0.1 | 0.1 | 0.6 | 4.7 | 1.6 |
| Cement manufacturing | 0.2 | 0.3 | 0.1 | — | — | — |
| Steel manufacturing | 0.3 | 0.9 | 0.4 | — | — | — |
| Fossil Fuel Extraction and Production | 0.8 | 3.9 | 0.4 | 7.6 | 33.1 | 5.8 |
| Power generation | 2.2 | 16.7 | 11.4 | — | — | — |
| UK Housing (convergence point)1 | 1.6 | 0.0 | 0.0 | — | — | — |
| Activities with 2030 targets integrating 1.5°C scenario after December 2022 | | | | | | |
| UK Livestock and Dairy Farming | 1.6 | 0.3 | — | 0.3 | 0.1 | — |
| Aviation | 0.5 | 1.7 | 0.4 | 0.1 | 1.0 | 0.3 |
| Commercial Real Estate2 | 0.0 | 0.0 | 0.0 | — | — | — |
| Total | 7.4 | 24.0 | 12.8 | 8.6 | 38.8 | 7.7 |
| Notes:  1 UK Housing is based on a convergence point and includes Social Housing and Business banking real estate which was added to the scope in 2023.  2 We have calculated Commercial Real Estate and Social Housing/Business Banking real estate emissions using “Business loans and unlisted Equity” PCAF asset-class methodology, The scope of coverage for Commercial Real Estate is based on the set of counterparties considered in the  2023 BlueTrackTM portfolio and may not fully align with our exposure to this activity in 2022. | | | | | | |

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| --- | --- | --- | --- |
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| Financed emissions for other activities not covered by targets integrating 1.5°C scenarios  (as at December 2022) | | | |
| Activities | Scope 1,2 emissions (MtCO2e) | | |
| On-balance-sheet lending | Undrawn commitments and  contingent liabilities | Capital markets financing |
| Mining and Quarrying | 0.9 | 2.3 | 0.2 |
| Energy and Water | 0.6 | 2.8 | 0.9 |
| Agriculture, Food and Forest Products | 1.4 | 0.2 | 0.0 |
| Manufacturing | 1.9 | 7.4 | 1.4 |
| Mortgages | 0.2 | — | — |
| Materials and Building | 0.3 | 0.2 | 0.0 |
| Transport | 0.7 | 2.0 | 0.9 |
| Other activities | 3.9 | 5.6 | 2.5 |
| Total | 9.9 | 20.4 | 5.9 |
| Government and central bank | 15.4 | — | — |
| Government and central bank (Excluding LULUCF)1 | 17.5 | — | — |
| Emissions covered under targets integrating 1.5°C  scenarios (excluding Government and central bank) | 55% | | |
| Note:  1 Emissions excluding land-use, land-use change and forestry. | | | |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 82 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

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| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

Data sourcing and data quality

We acknowledge the extent of data quality

challenges inherent in the calculations of

financed emissions for the full in-scope set of

activities. The PCAF Standard provides guidance

to measure data quality (DQ) through a hierarchy

ranging from DQ1 (best) to DQ5 (worst) specific

to each asset class. Our estimation of the data

quality is also largely aligned to the PCAF

Standard's guidance.

Our current data quality is dispersed across

DQ1-2 (reported emissions) data, DQ3 (deriving

emissions from physical activity data) and DQ4-5

(deriving emissions from revenue or asset-based

emission factors). For activities where we have

set targets, DQ is mostly concentrated across

DQ1-2 and DQ3. We have identified a

concentration of lower DQ scores for the

category of activities where we are yet to set

targets - including banks, financial institutions

and sovereigns. This indicates that we need to

consider the current estimate of financed

emissions for these activities as highly

preliminary and indicative only, and which can

change materially as we improve data quality.

Climate data, models and methodologies are

evolving – and are not yet at the same standard

as more traditional financial metrics. Our

financed emissions calculations rely on externally

sourced data mapped to internal customer and

client identifiers. The externally sourced data has

various limitations for each sector, including lack

of coverage, low resolution, consistency and

transparency of company-reported data, as well

as the time lag for external sources to report

estimates or actuals.

Time lags could be as much as two years for data

such as company value, company revenue share,

emissions, production capacity and capacity

factors. As a result our financed emissions

metrics are at best an estimate of our clients'

activities on a given date, using the external data

available at that point in time.

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| Data quality distribution of Barclays' financed emissions calculation (as at December 2022) | | | |
| Category | Scope 1,2 emissions1 | | |
| DQ1-2 | DQ3 | DQ4-5 |
| Reported emissions  (verified/unverified) | Use of physical-activity-  based emissions factors | Use of economic-activity-  based emissions factors |
| Activities with 2030 targets integrating 1.5°C scenario as at December 20222 | 18% | 74% | 7% |
| UK Housing (Convergence Point) | — | 63% | 37% |
| Activities with 2030 targets integrating 1.5°C scenario after December 2022 | 22% | — | 78% |
| Activities not covered by targets integrating 1.5°C scenarios (including Sovereigns) | 25% | — | 75% |
| Total | 19% | 17% | 64% |
| Notes:  1 For sectors where we calculate Scope 3 emissions – Aviation, UK Livestock and Dairy Farming, Fossil Fuel Extraction and Production, and Automotive manufacturing (LDV) – our data quality distribution is 85% in  DQ3 and 15% in DQ4-5.  2 Totals may not be equal to 100% due to rounding. | | | |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 83 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

Our approach to reporting financed

emissions data

Given the evolving nature of climate data, models

and methodologies, past-period metrics may

change to reflect updates. To manage the

impact of these changes we have adopted

a principles-based approach to guide whether

prior metrics and baselines should be restated

or re-baselined.

|  |  |  |
| --- | --- | --- |
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| Our approach to reporting financed emissions data | | |
| Scenario |  | Our approach |
| Error identified in our internal finance data or  methodology | Restatement | • Financed emissions metrics for all years impacted by the error will be restated, including the baseline year. |
| Changes to our methodology and/or data sources to  calculate financed emissions (for example, including  additional GHGs) | Re-baseline | • The updated methodology will be applied from the start of the current reporting period.  • The last reported financed emissions spot metric will be recalculated using the new methodology/data source to  provide the new baseline. This will ensure consistency of data and methodology when calculating our performance.  • The recalculated baseline and the progress achieved to date will be used to disclose the theoretical baseline for the  year in which the targets were originally set.  • The cumulative progress will be for the current reporting period (using the new methodology) and the progress up  until the last reporting period (using the old methodology). |
| Updates to external counterparty data driven by timing  lags when data is reported (for example, counterparty  valuations or emissions estimates) | Capture in-year | • The impact of updated external data will be included in the current period financed emissions data and the progress  metric for the current reporting period.  • Data lags are inherent to the process and Barclays will endeavour to use the latest available data . Historically  reported metrics will not be updated for data lags. |

• A restatement involves updating the historical

starting point for a period and recalculating the

historical performance.

• A re-baseline involves keeping the historical

performance constant and recalculating the

current period baseline to ensure consistency

when reviewing performance. The indicative

historical baseline will also be disclosed.

Due to this, direct like-for-like comparisons of

financed emissions information disclosed may

not always be possible from one reporting period

to another. Where information is restated or

re-baselined this will be identified or explained.

In line with our reporting approach for past period

metrics, we have re-baselined internal and

external data, which has resulted in minor

updates (less than 1%) to Energy, Cement and

Automotive Manufacturing metrics and a c.2%

impact to the Power metrics. The most material

change has been the treatment of multi-client

shared facilities, which has led to an additional

c.4% impact in the baseline (2022) metrics for

Automotive Manufacturing.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 84 |
|  |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

Assessing financed emissions for material

sectors and net-zero-aligned targets

Basis of preparation

As part of our commitment under the NZBA, we

have set targets for material1 high-emitting

sectors in our portfolio. We have developed  our

BlueTrack TM  methodology to measure and track

our targets, which incorporate a 1.5°C scenario

for our 2030 targets, for these high emitting

material sectors2. B lueTrack TM starts by selecting

a benchmark for a sector that defines how

financed emissions for a portfolio need to

change over time, in line with the goals and

timelines of the Paris Agreement – consistent

with scenarios limiting the increase in global

temperatures to 1.5°C. We measure the financed

emissions within a selected boundary for a

sector, then aggregate these into a portfolio-

level metric – which is then compared to the

benchmark.

BlueTrackTM is being expanded to cover the

Agriculture, Aviation and UK Commercial Real

Estate sectors. The Residential Real Estate

sector is also being expanded to include housing

associations and small business buy-to-let

lending, and is now referred to as UK Housing.

During 2023 we assessed our baseline emissions

from our Shipping sector portfolio as part of our

NZBA commitment to set targets covering the

transportation sector. This assessment

concluded that we provided limited financing to a

small number of clients and have limited financed

emissions overall. We have therefore not set a

target for the Shipping sector at this time . We

may reassess our approach in the future should

this become a more material contributor to our

overall financed emissions.

|  |  |
| --- | --- |
|  |  |
| + | Our Financed Emissions Methodology paper (published in  2024) provides more details of our methodology and can be  found within the ESG Resource Hub at:  [home.barclays/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [sustainability/esg-resource-hub/reporting-and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/) |
|  |

Sector boundaries

We have set targets on the segment of the

value chain where either (i) it is generally

recognised that decarbonisation efforts are likely

to spur the rest of the sector value chain to fall

into alignment or (ii) where financiers are likely

to have more influence over companies active

in that segment. Our choice of segment is based

on Barclays' own view, informed by guidance and

recommended practice from portfolio alignment

initiatives such as PACTA, SBTi and others.

Emissions scope

For each sector target in BlueTrackTM we must

consider which of a company's emissions we

should measure – for example, direct or indirect

emissions, or selected greenhouse gases such

as carbon dioxide and methane. We define this

according to the GHG Protocol definition of

Scope 1, 2, and 3 emissions. Within the boundary

of our target we aim to capture the part of a

company's value chain that generates  most of

their emissions, taking into account

considerations including materiality, consistency

to benchmark, level of control and whether the

emissions can be abated by the company. For

example, our Upstream Energy target includes

Scope 3 emissions – recognising they are

significant for a company extracting fossil fuels.

The financed emissions covered under

BlueTrackTM are therefore a subset of the total

financed emissions for each customer or client,

as they only include the portion of the client's

activities that are within both the value chain we

have chosen for the sector and the scope of

emissions we deem material for that activity.

Use of carbon credits

We do not allow company-purchased offsets

such as carbon credits to reduce emissions, as

we believe it is important to base a metric on

operational activities under a company's control

– rather than on unrelated credits, the availability

of which may be limited.

The methodology does allow company-operated

removals, such as on-site carbon capture at a plant

– however, given this is currently marginal in the

context of emissions, there is currently no impact

on our portfolio-financed emissions metrics.

Target metrics

Barclays uses two financed emissions metrics to

set targets:

1. Emissions Intensity: how much CO2e (Carbon

Dioxide Equivalent) is released on average for a

certain amount of economic activity or

material produced;

2. Absolute Emissions: a measure of the absolute

emissions generated, or fair share, of the

company's emissions over time.

We use absolute emissions for the Energy and

Agriculture sectors, whose decarbonisation

pathway relies on a reduction in production

volume as well as on a reduction in intensity. The

Energy sector cannot reduce its carbon

emissions intensity below a certain point – a

barrel of oil cannot be decarbonised, for instance

– and therefore a reduction in absolute carbon

emissions is more appropriate. The Agriculture

sector requires a shift away from the production

of meat and dairy towards alternative protein

sources, as farmers respond to changing diets.

We use emissions intensity for the other sectors,

whose decarbonisation pathway relies primarily

on reduction in intensity rather than volumes.

These metrics are sensitive to factors which are

not directly related to real world emissions, such

as changes in the book value of debt and equity,

for absolute emissions, and changes in revenue

share for emissions intensity.

Reference scenarios

Each of our 2030 target ranges is developed with

reference to a 1.5°C-aligned scenario. For the

majority this is the IEA's Net Zero by 2050

(NZE2050) scenario. In calculating a convergence

point for our UK Housing portfolio and a target for

UK Agriculture, we use a UK-focused Balanced Net

Zero Scenario developed by the UK's Climate

Change Committee (CCC BNZ). For the UK CRE

portfolio we use the CRREM scenario that provides

decarbonisation pathways across different

property types consistent with the NZE2050

scenario. For the Aviation sector we use the Mission

Possible Partnership (MPP)'s 'Prudent' (PRU)

scenario – a 1.5°C-compatible roadmap for the

sector to achieve net zero emissions by 2050.

Baseline year

We measure our financed emissions for each

portfolio against a baseline metric determined in

the year we first assessed that target. The baseline

year therefore varies across the nine sectors

assessed to date, to ensure we are using the most

up-to-date data available when we set our targets –

or, in the case of UK Housing, a convergence point.

Use of target ranges

For Power, Cement, Steel, Automotive

manufacturing and Aviation, we have set

emissions intensity targets using a target range.

While we are clear on the reduction required to

align with the 1.5oC benchmark pathway – the

higher emissions reduction in the range – we

recognise there are dependencies outside our

control that will determine how quickly our

financed emissions intensity can be reduced in

these sectors. The lower emissions reduction in

the range reflects our view of the sector, client

pathways and commitments at the time of

setting the target. We seek to achieve the higher

emissions reduction, consistent with our net

zero ambition, but achieving it will depend on

external factors.

Notes:

1 As defined in Foundations of Climate Mitigation Target Setting

published by the UNEP Finance Initiative ([unepfi.org/wordpress/](https://www.unepfi.org/wordpress/wp-content/uploads/2022/05/Foundations-for-climate-mitigation-target-setting.pdf)

[wp-content/uploads/2022/05/Foundations-for-climate-](https://www.unepfi.org/wordpress/wp-content/uploads/2022/05/Foundations-for-climate-mitigation-target-setting.pdf)

[mitigation-target-setting.pdf](https://www.unepfi.org/wordpress/wp-content/uploads/2022/05/Foundations-for-climate-mitigation-target-setting.pdf)).

2 When we first developed BlueTrack, the best available scenario

to develop Paris-aligned benchmarks for our financing portfolios

was the International Energy Agency’s Sustainable Development

Scenario (SDS) which was aligned to a 1.7°C world. The 2025

targets set for the Energy and Power sectors were informed by

the SDS scenario.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 85 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

Update on progress against targets

We had set targets for our Energy and Power

portfolios in 2020, and since then we had

expanded the scope of sectors covered under a

target to also include Cement, Steel and

Automotive manufacturing.

Additionally, we had announced a convergence

point for the UK Housing sector. For all sectors

where we have previously set targets, we have

reported progress as at December 2023.

We will keep our policies, targets and progress

under review in light of the rapidly changing

external environment and the need to support

governments and clients both in delivering an

orderly transition and providing energy security.

It is important to note that progress towards our

targets will likely be variable and non-linear.

We may need to adapt our approach to respond

to external circumstances and to manage the

effectiveness and impact of our support for the

transition, while remaining focused on our

ambition of becoming a net zero bank by 2050.

|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Financed emissions metrics | | | | | | | | | | | |
| Sector | | | | Setting our targets | | | | | Monitoring our progress in 2023 | | |
| Sector | Sector boundaries | Emissions  scope | GHG included | Reference scenario | Target metric | Unit of  measurement | Baseline  year | Target versus baseline | Cumulative  change | Absolute emissions  (MtCO2e) | Physical intensity |
| Energy | Upstream Energy | 1,2 & 3 | Carbon dioxide and  methane | IEA SDS | Absolute  emissions | MtCO2e  (absolute) | 2020 | -15% by end of 2025 | -44% | 42.5Δ | 59.6 gCO2e/MJ |
| IEA NZE2050 | -40% by end of  2030 |
| Power | Power generators | 1 | Carbon dioxide | IEA SDS | Physical  intensity | kgCO2e/MWh | 2020 | -30% by end of 2025 | -26% | 16.9 | 241Δ |
| IEA NZE2050 | -50% to -69%  by end of 2030 |
| Cement | Cement manufacturers | 1 & 2 | All GHGs | IEA NZE2050 | Physical  intensity | tCO2e/t | 2021 | -20% to -26%  by end of 2030 | -8% | 0.8 | 0.573Δ |
| Steel | Steel manufacturers | 1 & 2 | All GHGs | IEA NZE2050 | Physical  intensity | tCO2e/t | 2021 | -20% to -40%  by end of 2030 | -16% | 1.3 | 1.635Δ |
| Automotive  manufacturing | Light Duty Vehicles  manufacturers | 1,2 & 3 | All GHGs for Scope  1 and 2; carbon  dioxide for Scope 3 | IEA NZE2050 | Physical  intensity | gCO2e/km1 | 2022 | -40% to -64%  by end of 2030 | 0% | 6.0 | 175.2Δ |
| Aviation | Commercial Aviation (Air Travel)  – Passenger (including belly  cargo) and Dedicated cargo | 1 & 3 | Carbon dioxide for  Scope 1; All GHGs  for Scope 3 | MPP Prudent | Physical  intensity | gCO2e/RTK | 2023 | -11% to -16%  by end of 2030 | Baseline set in  2023 | 4.3 | 882Δ |
| UK Commercial  Real Estate | UK Corporate Bank | 1 & 2 | Carbon dioxide,  methane and  nitrous oxide | CRREM II | Physical  intensity | kgCO2e/m2 | 2023 | -51% by end of 2030 | 0.1 | 30.0Δ |
| Agriculture | UK Livestock and Dairy Farming | 1, 2 & 3 | Carbon dioxide,  methane and  nitrous oxide | CCC BNZ | Absolute  emissions | MtCO2e | 2023 | -21% by end of 2030 | 2.4Δ | N/A |
| UK Housing2 | UK buy-to-let and owner-  occupied mortgages, Social  Housing and Business Banking | 1 & 2 | Carbon dioxide,  methane and  nitrous oxide | CCC BNZ | Physical  intensity | kgCO2e/m 2 | 2023 | Portfolio convergence  point vs. baseline | 1.7 | 32.1Δ |
| -40% by end of 2030 |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Notes  1 Physical intensity (CO2e emissions per v-km travelled by LDV produced), expressed in gCO2e/km.  2 Barclays has identified a 2030 emissions intensity convergence point for UK Housing but has not set a formal target. This replaces the 2022 convergence point for ‘Residential Real Estate’.  Δ  2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub: home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/. | | | | | | | | | | | |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 86 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

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| Baselines at December 2023 | | | | | | | |
| Sector | Unit | Baseline year | Baseline metric (last  reported) | Previously reported metrics | | Recalculated metrics | |
| Financed emissions for  December 2022 | Change at December  2022  (percentage change) | Recalculated financed  emissions for December  2022 | Theoretical  baseline metric  (re-baselined) |
| Energy | MtCO2e (absolute) | 2020 | 75.7 | 51.7 | -32% | 51.6 | 75.4Δ |
| Power | kgCO2e/MWh | 331 | 302 | -9% | 298 | 326Δ |
| Cement | tCO2e/t | 2021 | 0.625 | 0.610 | -2% | 0.611 | 0.626Δ |
| Steel | tCO2e/t | 1.945Δ | No major impact of methodology changes | | | |
| Automotive manufacturing | gCO2e/km | 2022 | 167.2 | 167.2 | N/A | 174.8 | 174.8Δ |
| Aviation | gCO2e/RTK | 2023 | 882Δ |  |  |  |  |
| UK Commercial Real Estate | kgCO2e/m2 | 30.0Δ |  |  |  |  |
| Agriculture | MtCO2e (absolute) | 2.4Δ |  |  |  |  |
| UK Housing1 | kgCO2e/m 2 | 32.1Δ | Replacing the former UK Residential Real Estate with a new baseline on an expanded scope2 | | | |
|  |  |  |  |  |  |  |  |
| Notes:  1 Barclays has identified a 2030 emissions intensity convergence point for UK Housing but has not set a formal target.  This replaces the 2022 convergence point for ‘Residential Real Estate’.  2 The former UK residential real estate baseline, was re-baselined to 32.0Δ from 32.9, as reported in FY2022.  Δ    2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub: home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/ | | | | | | | |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 87 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

Progress against our existing sector targets

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| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
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|  | Financed emissions - Energy  Absolute emissions MtCO 2 e (Indexed 2020 = 100) | | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
|  |  | IEA NZE Benchmark: World |  | Barclays' progress |  | Portfolio target path |  |
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| --- | --- | --- | --- | --- | --- | --- | --- |
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|  | Financed emissions - Power  Physical Intensity kgCO2e/MWh (Indexed 2020 = 100) | | | | | |  |
|  |  |  |  |  |  |  |  |
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|  |  | IEA NZE Benchmark: World |  | Barclays' progress |  | Portfolio target path  (range) |  |
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| --- | --- | --- | --- | --- | --- | --- | --- |
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|  | Financed emissions - Cement  Physical Intensity tCO2e/t (Indexed 2021 = 100) | | | | | |  |
|  |  |  |  |  |  |  |  |
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|  |  | IEA NZE Benchmark: World |  | Barclays' progress |  | Portfolio target path  (range) |  |
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| --- | --- | --- | --- | --- | --- | --- | --- |
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|  | Financed emissions - Steel  Physical Intensity tCO2e/t (Indexed 2021 = 100) | | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
|  |  | IEA NZE Benchmark: World |  | Barclays' progress |  | Portfolio target path  (range) |  |
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| --- | --- | --- | --- | --- | --- | --- | --- |
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|  | Financed emissions - Automotive manufacturing  Physical Intensity (gCO 2e/km) (Indexed December 2022 = 100) | | | | | |  |
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|  |  | IEA NZE Benchmark: World |  | Barclays' progress |  | Portfolio target path  (range) |  |
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Note: Δ    2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub: home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 88 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

![41231686041853]()

Dec'23: 241 △

(-26%)

![41231686041784]()

Dec'23: 42.5 △

(-44%)

![41231686041961]()

Dec'23: 0.573 △

(-8%)

![41231686042070]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| 2020 | 2025 | 2030 | 2040 |

Dec'23: 1.635 △

(-16%)

![41231686042174]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| 2020 | 2025 | 2030 | 2040 |

Dec '23: 175.2 △

(0%)

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| --- | --- | --- | --- |
|  |  |  |  |
| 2020 | 2025 | 2030 | 2040 |

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| --- | --- | --- | --- |
|  |  |  |  |
| 2020 | 2025 | 2030 | 2040 |

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| --- | --- | --- | --- |
|  |  |  |  |
| 2020 | 2025 | 2030 | 2040 |

Progress against

our BlueTrackTM sector targets

This report provides an update on our progress

towards achieving our previously announced

2025 and 2030 BlueTrackTM sector targets. In

2023 and cumulatively, there are a number of

drivers behind the changes in our portfolio

emissions, including changes in our financing

across both our lending and capital markets

financing activity, our clients' emissions, client

data and metrics such as company valuation, and

other data inputs and methodology updates as

defined in our Financed Emissions Methodology

paper (published in 2024). We expect to continue

to see these impact our metrics in the future as

data availability and quality, methodologies,

guidance, and best practices for calculating our

financed emissions metrics – all of which include

differing levels of estimation –continue to evolve

and be refined.

Energy

To date our absolute financed emissions from

our upstream Energy portfolio are down 44% to

42.5 MtCO2eΔ from our 2020 baseline – an

additional 12% reduction from our 2022 level. Of

our total financed emissions, c.79% was related

to oil, gas and natural gas liquids (NGLs)

production, with NGLs being relatively

immaterial. The remaining c.21% was

attributable to coal production. Our progress in

2023 largely reflects reductions in our total

financing volumes for this portfolio as well as

impacts from changes in company book values

which can fluctuate year to year and thus impact

cumulative and year-over-year progress (either

positively or negatively) on our target.

Power

In 2023 our Power generation portfolio achieved

a 26% cumulative reduction in emission intensity

– an additional 17% reduction from our 2022

levels. This reflects our clients' continued

progress in reducing their own emissions

intensity, which was identified in part through

improved data collection and analysis, as well as

net reductions in the intensity of our new lending

activity – but was partially offset by a higher

intensity mix for our capital markets financing.

Additionally a material portion of our 2023

progress was driven by a short-term transaction.

There is a risk that we are not able to replace this

with a transaction(s) of similar size and emissions

intensity which could result in an increase in our

reported emissions intensity.

Within our Power portfolio our clients' ability to

continue transitioning, and therefore our ability

to continue increasing our green and transition

financing to help deliver our BlueTrackTM and

Sustainable Financing targets, are dependent, at

least in part, on supply chains for renewable

energy, required investments in grid

infrastructure, a stable or positive policy

environment, and other factors potentially

beyond our control, including our clients'

strategic or financing decisions.

Despite our progress to date and the actions we

have taken to manage our portfolio, the

likelihood of achieving our targets – particularly

the 2025 target where the potential

management actions are narrowing – could be

significantly impacted by the variables and

dependencies described on this page.

Cement

The emissions intensity of our Cement portfolio

has reduced by a cumulative 8% against our

2021 baseline – a decrease of 6% from last year’s

metric. During 2023 we’ve seen a material

number of our clients in this sector update their

emissions intensity targets and receive SBTi

validation as 1.5°C-aligned.

Steel

Our Steel portfolio emissions intensity has

dropped by c.16% from our 2021 baseline – an

additional 5% decrease this year. During 2023

the decreased intensity reflects our clients'

continued progress in achieving emissions

reductions and a shift in our financing activity mix

towards lower-emissions clients.

Automotive manufacturing

During 2023 our Automotive manufacturing

portfolio's emissions intensity remained broadly

flat. This reflects a reduction in the emissions

intensity of our clients as they increase their

electric vehicle sales, but was partially offset by

year-over-year reductions in our clients' green

bond issuance and a net increase in the

emissions intensity of our lending activity due to

the mix of our portfolio.

Future target progress

To date, emissions reductions in the real

economy have not been sufficient to align

economies to a 1.5°C pathway.

We expect our progress against these targets will

continue to be non-linear, due to the many

external dependencies and variables beyond

Barclays' control that may determine the pace of

transition. For example, a recent assessment

identified that plans, projections and policies for

fossil fuel production by governments are not in

line with the goals and timelines of the Paris

Agreement1.

Going forward our metrics will continue to have

the potential to reflect different levels of volatility

and could be impacted by a variety of external

factors, including but not limited to:

• The pace and timing of our clients’ progress,

on their individual transition pathways

• Future technological advancements

• The public policy and regulatory environment

• Geopolitical or regional developments

• Updates to data inputs used by BlueTrackTM

(e.g. company valuations).

The volatility of the mix and volume of capital

markets financing, which is included in our

metrics, may also result in significant increases

and decreases in our metrics. Our ability to

achieve our targets may be affected positively or

negatively by these external factors.

Our target progress in future years could be

impacted by client portfolio decisions driven by

other non-financial factors, such as counterparty

risk, and other relevant business considerations.

Changes in our financing activity for a single

client within a portfolio can have a significant

impact on our reported metrics and progress and

may be outside of our control.

Progress against our targets may also be

impacted by management decisions based on

key drivers unrelated to climate or the transition,

for example prudent risk management practices.

Specifically across the Cement, Steel and

Automotive manufacturing portfolios, in addition

to the general risks and dependencies outlined

above, these targets are particularly sensitive to

even minor changes in our financing mix or

clients' emissions intensity, given the relatively

limited number of clients included in these

portfolios – so progress towards these targets

could be particularly volatile and significantly

impacted by the portfolio and client

dependencies outlined above.

Notes:

1 unep.org/resources/production-gap-report-2023

Δ2023 data subject to independent Limited Assurance under ISAE

(UK) 3000 and ISAE 3410. Current limited assurance scope and

opinions can be found within the ESG Resource Hub:

home.barclays/sustainability/esg-resource-hub/reporting-and-

disclosures/

Managing our portfolios

We continue to manage our portfolios, balancing

between our commercial objectives, prudent risk

management practices and other non-financial

objectives in support of our strategy. As part of

this we take into account our relevant climate-

related risks and considerations, including how our

portfolios are performing against our BlueTrackTM

targets so this can be evaluated in context

alongside other relevant business metrics.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 89 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

We monitor our performance against our climate

targets on a regular basis. Where we identify

targets are potentially at risk of being missed –

particularly as target dates draw nearer and the

opportunities for us to take management actions

narrow – we will continue to reassess our

approach, taking into account broader business

considerations including potential franchise

impacts.

During 2023 we have continued to invest in

building improved reporting, tools, and

processes including our Client Transition

Framework, which enables us to adjust

management oversight based on our evolving

estimates of our future potential performance

against these targets.

|  |  |
| --- | --- |
|  |  |
| + | Further details of how climate risk-related  considerations are managed can be found in the  managing impacts in lending and financing section on  page  [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559) . |
|  |

Client Transition Framework (CTF)

The CTF, first piloted in 2022, supports our

evaluation of our corporate clients' current and

expected future progress as they transition to a

low-carbon business model.

We conduct these assessments annually for

corporate clients in the Corporate and

Investment Bank that are in-scope for sectors

where BlueTrackTM targets have been set. As

new BlueTrackTM targets are set the CTF will be

applied to our corporate clients in those sectors.

During 2023 we enhanced our CTF based on

recommendations from the external review of

our pilot. The continued development of the CTF

leverages climate expertise across Barclays and

is informed by the evolving landscape and

guidance from third-party frameworks such as

TPI, CA100+ and SBTi, and other industry

initiatives including the UK's Transition Plan

Taskforce, and GFANZ. We have maintained the

general structure of our assessments with

component scores aggregating into an overall

CTF score.

The ambition component seeks to assess a

client's alignment with our emissions reduction

targets and 1.5°C scenario benchmarks across

the past, present, near- and long-term future

emissions. In our scoring assessments we place

a higher weighting on their past, present and

near-term future emissions targets than on their

long-term ones.

The credibility component seeks to assess the

qualitative elements of a client’s transition plan. It

considers criteria that indicate the likelihood a

client will meet its targets, such as board

oversight, low-carbon technologies employed,

and green capital or operational expenditure

plans. We more heavily weight the criteria that

are critical to having a credible plan than those

that are determined to be supporting criteria.

Most of these criteria are consistent across

sectors, however, we also consider some sector-

specific criteria. In total we evaluate over 80 data

points for each assessment. Examples of our

CTF criteria include, but are not limited to:

• The company’s ambition and targets to

reduce operational (Scope 1 and 2) emissions

• Historic Scope 3 disclosures and Scope 3

reduction targets, along with a 2030 target

• Any expansion of high-carbon activities

• Forward-looking green capex plan to achieve

their targets.

The sub-scores for each component are

combined to arrive at an overall CTF score from

T1 (best) to T5 (worst).

We have codified where clients would be deemed

out-of-scope for our CTF assessments. We

have set a minimum revenue share threshold to

identify which clients are required to be

assessed, though clients below this threshold

may still be assessed.

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|  | CTF overview | | | | | | | | | | | | | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Ambition | | | | | | | | |  | Credibility | | | | |  |
|  | Assesses clients’ past, present and future emissions  as a proxy for their emissions reduction ambition | | | | | | | | |  | Assesses the critical and supporting qualitative  elements of clients’ transition plans as a proxy for  the credibility of their plans | | | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Past  emissions | | | | Evidence of progress  in emissions over the last  three years | | | | |  | Critical  criteria | | Assessment of disclosed  indicators that significantly  impact the likelihood of  achieving set target(s), such as  governance indicators, use of  low-carbon technologies,  green spending plans, and  expansion of carbon-intensive  assets | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |
|  | Present  emissions | | | | Comparison of current  BlueTrackTM emissions  against target glidepaths | | | | |  |  |
|  |  |  |  |  |  |  |  |
|  |  | Supporting  criteria | | Assessment of the level of  consistency given to  transitioning their business,  such as the use of offsets/  credits, TCFD alignment and  SBTi target validation  submission | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |
|  | Future  emissions | | | | Assessment of client targets  including projected emissions  metrics and rates of change  to 2030 and 2050 | | | | |  |  |
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|  | Sector-specific considerations | | | | | | | | | | | | | | |  |
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|  | Assesses transition-related elements that have not been addressed within the other sections | | | | | | | | | | | | | | |  |
|  | Sector-specific indicators | | | | | | | | |  | Unscored criteria | | | | |  |
|  | Additional sector-specific factors that impact the  strength of a transition plan | | | | | | | | |  | Factoring additional data points that might be beneficial for  benchmarking purposes and/or for future reference | | | | |  |
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|  | Energy | |  | Power | | |  | Cement | |  | Just transition pilot | | | | |  |
|  | • Methane  commitments | |  | • Coal phase-  out plan | | |  | • Target set on  gross basis | |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Ambition score | | | | | | | | |  | Credibility score | | | | |  |
|  | A1- A5 | | | | | | | | |  | C1 - C5 | | | | |  |
|  | White Arrow_Down.png | | | | | | | | |  | White Arrow_Down.png | | | | |  |
|  | Client Transition Framework score | | | | | | | | | | | | | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Best | T1 | | | | T2 | | | T3 | | | T4 | T5 | | Worst |  |
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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 90 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

Embedding the CTF

CTF assessments are increasingly used to inform

decision-making across Barclays, including client

engagement, restrictions on financing and

capital allocation.

During 2023 we expanded how CTF scores are

used in support of our broader climate strategy.

The CTF informs our engagement with clients while

also helping to identify and manage transition risk in

our own financing portfolios.

Capital is critical for a successful energy

transition and we are focusing our financing

towards clients actively engaged in the energy

transition. The scale of our business gives us the

opportunity to help finance the energy transition

– to use our global reach, products, expertise and

position in the global economy to work with our

clients, including those in the Energy sector, as

they transition to a low-carbon business model.

In 2023 we began climate-specific engagement for

those clients with CTF scores of T4 and T5,

facilitated by a newly established Client Transition

Review Forum (CTRF).

The CTRF consists of senior representatives from

across Sustainable Finance, ESG & Sustainability,

Climate Risk, Portfolio Management, and Banking

and is chaired by the Head of Sustainable Finance.

Informed by the CTF, this new forum conducts

holistic reviews of our business appetite alongside

the future client relationship potential. These are

informed by the CTF assessment and take into

account consideration of relevant risks and other

business factors.

These reviews help determine our financing

appetite for these clients (including consideration

of client retention and conditions to refinancings),

alongside implications for our emissions

reduction targets, commercial, credit and

reputational impacts.  Notwithstanding the

outcomes of the CTRF reviews, financing

decisions are transaction specific, and will

continue to be subject to consideration by

relevant committees, such as in relation to credit

risk, reputation, and capital impact.

As a newly established forum, its governance of the

CTRF will continue to evolve to ensure it remains fit

for purpose.

We reviewed over 300 client counterparties at

the CTRF in 2023, engaging with clients as

appropriate, to help build awareness of the need

to transition and gather information on how we

can best support them in their journey. The CTF

helps us prioritise client engagement, focusing

on those most at risk of falling behind our

transition expectations.

We have also begun to use the results from the

CTF assessments to drive engagements with

clients, facilitating discussions about their

transition plans and providing insights such as

highlighting how they benchmark against their

peers.

We have found this engagement helps increase

our connectivity with these clients and can be

useful in identifying opportunities to further

finance their transition.

We are also using the CTF scores to inform our

business and credit appetite as we look to

manage transition risks within our portfolios. To

do this we have begun implementing CTF-linked

mandate and scale limits.

The CTF approach is kept under review and we are

considering enhancements in 2024, including

reviewing the weightings for criteria such as energy

clients capex, to align elements more closely to our

updated Climate Change Policy.

CTF results

![115448720985088]()

|  |  |
| --- | --- |
|  |  |
| n | T1 (best) |
| n | T2 |
| n | T3 |
| n | T4 |
| n | T5 (worst) |
|  |  |

Note: Charts and figures exclude clients determined to be out

of scope for the CTF assessments. Clients may have scores in

multiple sectors but are included only once to avoid double-

counting.

Using our updated CTF methodology we

completed assessments covering over 1,250

counterparties during 2023 across our Power,

Energy, Steel, Cement, Automotive

manufacturing and Aviation BlueTrackTM sector

portfolios.

Findings, by client count, from our assessments

include:

• 86% have a public emissions reduction target

• of which 38% in SBTi-eligible sectors have

had their targets validated

• 67% have executive compensation tied to

ESG progress

• 85% have explicit board oversight of their

transition plan or emissions targets

• 40% have committed to a just transition.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 91 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

Energy and Power

Context: The Energy and Power transition

The successful transition of the Energy and

Power sectors is crucial to achieve net zero by

2050 as together they account for 75% of global

GHG emissions, the majority of which come from

the combustion of fossil fuels by end users – for

example, in automotives and power generation1.

Emissions from fossil fuel extraction, including

from flaring and venting, is also significant – and

responsible for 40% of global methane

emissions2.

The global economy still uses fossil fuels for

many essential activities – including electricity

generation, transport and heating. The IEA

scenarios to limit global warming to 1.5°C

assume continued but reducing use of fossil fuels

as part of the energy mix.

As Energy and Power play a fundamental role in

society, the transition must balance the need to

address energy security and shift energy supply

while meeting energy demand. Consideration

must also be given to the need for a just

transition, ensuring equitable access to energy

across communities.

We will continue to support an energy sector in

transition, focusing on the diversified energy

companies investing in low carbon and with

greater scrutiny on those engaged in developing

new oil and gas projects.

Notes:

1 See climatewatchdata.org/ghg-emissions

2 See ea.org/energy-system/fossil-fuels/methane-abatement

Reducing our Energy and Power-financed

emissions

We have set targets to reduce our financed

emissions from our Energy and Power portfolios

in line with the decarbonisation pathway set out

in the IEA Net Zero scenario (IEA NZE).

To meet our targets we utilise our full toolkit

including CTF assessments, client engagement,

portfolio management and restrictive policies,

which are included in our Climate Change

Statement.

As outlined on page [90](#i4be61753b7f243b19551b0bfbf3a2a0d_8287) above, our CTF

assessments evaluate over 80 data points for

each assessment and, in relation to Energy and

Power, include the following additional criteria:

• Methane emissions reduction targets (for

Energy)

• Commitments to phase-out thermal coal (for

Power)

We actively engage with clients to help build

awareness of the need to transition and gather

information on how we can best support them in

their journey. The CTF is helping us to prioritise

client engagement, focusing on those most at

risk of falling behind our transition expectations.

We have established a climate portfolio

management team to steer our portfolio

towards achieving our targets and manage

transition risks, using CTF scores to inform our

business and credit appetite.

Total exposure to the Energy sector is subject to

a constrained and closely monitored aggregate

risk appetite. We have begun implementing CTF-

linked credit limits for the clients most at risk of

failing to transition in line with our targets and

climate risk appetite – currently identified as

those with scores of T4 and T5.

We have a Climate Change Statement which sets

out our positions and approach to sensitive

sectors. In 2024 we have updated the Climate

Change Statement to include new requirements

for the Energy sector and restrictions on the type

of exposures and risk we will finance going

forward.

Under the updated Climate Change Statement,

Energy Groups with more than 10% of their total

planned upstream oil and gas capital expenditure in

expansion, non-diversified groups and Energy

Groups with the lowest CTF assessment scores

will be subject to mandatory annual review by the

CTRF to determine whether continued financing

support is appropriate in the context of their

expansion plans and overall transition plan.

|  |  |
| --- | --- |
|  |  |
| CTF Energy and Power portfolio results | |

Energy portfolio

• 78% of in-scope clients have a methane-

reduction target

![41231686223785]()

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
| n | T1 (best) | n | T2 | n | T3 | n | T4 | n | T5 (worst) |

|  |  |
| --- | --- |
|  |  |
| CTF energy portfolio score descriptions | |
|  |  |
| T1  (best) | Clients are fully aligned with our NZE targets. This requires net zero targets (NZE 1.5° C-aligned  or equivalent) across all relevant scopes, including Use of Sold Product (Scope 3, Category 11)  by 2050 (for Energy), evidence of strong progress already made, and disclosures of advanced  planning to reduce emissions further. |
| T2 | Clients have targets across all relevant scopes and strong plans but may be missing some of  the clarifying details of a T1 plan – or may not have demonstrated strong steps taken to date. |
| T3 | Clients may have very ambitious targets but lack the details to evidence that they will achieve it,  a weak target but robust disclosures evidencing that they will achieve it, or a combination  thereof. Energy clients without Scope 3 disclosures and Scope 3 targets cannot achieve better  than T3. |
| T4 | Clients have poorly disclosed plans. They generally have some combination of targets that are  weaker than the scenarios require, disclosures lacking in detail, or limited evidence that steps  are already being taken. |
| T5  (worst) | Clients have the default and lowest score. These clients provide limited publicly available  information on their sustainability targets and strategy. A client must have publicly  demonstrated transition planning including some evidence of their historic, current and future  emissions reduction efforts to score better than T5. |

Notwithstanding the outcomes of the CTRF

reviews, financing decisions are transaction

specific, and will continue to be subject to

consideration by relevant committees, such as in

relation to credit risk, reputation and capital impact.

By 2026, we will only provide financing to Energy

clients with Scope 1 and 2 emissions reduction

targets, methane emissions targets, and

commitments to end all routine and non-

essential venting and flaring.

|  |  |
| --- | --- |
|  |  |
| + | More details on the updated policy can be found on page  [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720),  our Climate Change Statement can be found home.barclays/  sustainability/esg-resource-hub/statements-and-policy-  positions/ and further information on our client engagement  can be found  on page [107](#i4be61753b7f243b19551b0bfbf3a2a0d_334) . |
|  |

Power portfolio

• 74% of in-scope clients will have phased-out

coal by 2030

![41231686223870]()

Note: Charts and figures exclude clients determined to be out

of scope for the CTF assessments

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 92 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

Aviation

Currently there are no alternative power

technologies – such as electric or hydrogen – for

commercial aircraft that are expected to be at

scale for the foreseeable future. Therefore,

decarbonising the Aviation sector over the next

10-15 years will require a significant increase in

the historical pace of emissions reductions –

which will be dependent on both the price and

availability of sustainable aviation fuel (SAF) and

the continued production and delivery of lower-

emissions aircraft.

Our Aviation emissions intensity target

We have set a target to reduce the financed

emissions intensity of our Airlines portfolio by

11-16% by end of 2030 against a 2023 baseline,

calculated using our BlueTrackTM methodology:

• The lower emissions reduction in the range

reflects a convergence point for our portfolio

with the MPP PRU scenario, which is consistent

with limiting global warming to 1.5°C.

• The higher emissions reduction in the range is

aligned to the rate of emissions intensity

reduction in the MPP PRU scenario, consistent

with our approach for our other existing 2030

targets.

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | Financed emissions - Aviation (Passenger and Cargo)  Physical Intensity (gCO 2 e/RTK) (Indexed December 2023 = 100) | | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  | | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  | MPP Aviation Pathway |  | Barclays' progress |  | Portfolio target path (range) |  |
|  |  |  |  |  |
|  |  |  |  |  |  |  |  |

Estimating our financed emissions

Barclays is a founding signatory to the Pegasus

Principles – the first climate-aligned finance

framework for the Aviation sector, developed by

the Rocky Mountain Institute (RMI) in partnership

with global banks and in consultation with leading

airlines and lessors, The Pegasus Principles will

launch publicly this spring.

In developing our approach for the Aviation

sector we have worked closely to align our

BlueTrack™ methodology with this common

framework we expect will also be used by a

number of other peer banks. By aligning

ourselves with an emerging industry consensus

approach we hope to create consistency and

transparency for our clients and for our

stakeholders in our own reporting.

|  |
| --- |
|  |
|  |

In line with the Pegasus Principles we are estimating

the financed emissions and emissions intensity of

our Aviation portfolio using a physical intensity

metric, gCO2e/revenue-tonne-kilometre (gCO2e/

RTK). The scope of this portfolio target includes

emissions related to direct combustion of jet fuel

by aircrafts (tank-to-wake/Scope 1) and

upstream production and refining (well-to-tank/

Scope 3) for commercial passengers (including

belly cargo) and dedicated air cargo operators.

Emissions scope can differ based on the actual

operator of the aircraft, as the owner of the

aircraft may not necessarily be the operator –

lessors versus airlines, for example. Military

aviation, corporate jets, general civil aviation, tour

operators and multi-modal logistics companies

are out of scope due to low materiality (as a share

of sector emissions) and data availability

challenges.

To do this we have partnered with PACE (Platform

for Analysing Carbon Emissions), a Pegasus

Principles-qualified data provider, to provide

granular emissions and activity data based on

specific flight routes and aircraft flown for each

airline operator.

|  |  |
| --- | --- |
|  |  |
| + | Further details on our financed emissions methodology can  be found in our latest Financed Emissions Methodology paper  (published in 2024) at: home.barclays/esg-resource-hub/  reporting-and-disclosures/ |
|  |

Future progress against this target

The general factors outlined on page [89](#i4be61753b7f243b19551b0bfbf3a2a0d_289) in

relation to progress against our targets will

equally be relevant to this portfolio. Additionally,

and more specifically, we are clear as to the level of

emissions reductions required to align with the MPP

pathway – but we recognise there are many

dependencies and variables outside of our control,

and that of our clients, which will determine how

quickly emissions intensity can reduce in this

sector.

We note that our clients’ ability to meet their own

targets is dependent on continued regulatory,

policy, technical, and supply chain support for the

industry – including the future availability and price

of SAF – and clients' progress towards achieving

their targets may impact our ability to achieve our

own.

Additionally we note that, while we are setting an

2030 interim target, many of our clients have set

their own interim targets to a 2035 date to

specifically account for hoped-for growth in SAF

production – and, since the level and timing of

that growth is an imperfect estimate, the

pathway to our targets may not be linear (or

close to linear), and may limit our ability to

accurately determine whether we are on path to

achieve, or are able to achieve, our own targets.

Note:

Δ    2023 data subject to independent limited assurance under ISAE

(UK) 3000 and ISAE 3410. Current limited assurance scope and

opinions can be found within the ESG Resource Hub:

home.barclays/sustainability/esg-resource-hub/reporting-and-

disclosures/

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 93 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| 2023 | 2025 | 2030 | 2040 |

![42331197669389]()

Dec'23: 882  △

Agriculture

Barclays finances customers and clients across

the agriculture-food value chain – from farmers

and producers of food products to retailers and

restaurants. As one of the largest lenders to

farmers in the UK, Barclays is well placed to

provide support through the changing nature of

the Agricultural sector – in particular the ongoing

shifts in consumer diets. Other factors important

to consider are the impact of decarbonisation on

broader food security and affordability, where

upside and downside risks exist depending on the

form the transition takes as well as the

opportunity for carbon sequestration and

improving biodiversity – given the sector controls

71% of land in the UK.

|  |  |
| --- | --- |
|  |  |
| + | Further information on our management of nature-related  risks, including in the UK Farming sector, identified during  our TNFD assessment of our European Agriculture and Food  portfolio can be found on page [276](#i4be61753b7f243b19551b0bfbf3a2a0d_12263). |
|  |

To support UK farmers through this transitional

period, Barclays finances activities that aim to

reduce emissions in Agriculture and result in

nature-positive outcomes. This includes

investment in low-carbon farming measures and

financing to improve machinery energy efficiency.

We also have a dedicated Agriculture Technology

Fund to support farming clients undertaking more

sustainable practices or implementing energy-

efficiency improvements. In addition, we support

early-stage companies developing technology

solutions needed for the transition to net zero

through our Sustainable Impact Capital portfolio.

For example, in 2023 we invested in Agricarbon –

a UK-based soil carbon measurement start-up.

|  |  |
| --- | --- |
|  |  |
| + | Further details on our Sustainable Impact Capital can be  found on page [117](#i4be61753b7f243b19551b0bfbf3a2a0d_364). |
|  |

Barclays engages with farmers to explore the

challenges and opportunities that may emerge

from the decarbonisation of the Agricultural

sector. In 2023 we launched a survey of our UK

Livestock and Dairy farming clients to better

understand the challenges they may face in

progressing towards net zero.

We also work individually with clients using our

Client Transition Tool (CTT) to identify nature

and decarbonisation risks, as well as considering

social risks. We support peer-to-peer learning

through our Farm to Farm initiative that

facilitates events for farmers in similar

geographic areas to cultivate innovative

sustainable farming practices. Over 100 farming

clients attended Farm to Farm events in 2023,

with further events planned for 2024.

Estimating our financed emissions

There are significant challenges to calculating

emissions for the Agricultural sector, notably a

critical lack of data on the activities and practices

of our agricultural customers and clients, and

modelling challenges around agricultural

emissions intensity. This is exacerbated by the

highly disaggregated nature of the farming

industry – characterised by a large number of

small farm holdings – which makes collating and

processing data challenging, and requires the use

of estimated data.

As a result Barclays has focused its initial

assessment on the UK Dairy and Livestock

sector – which is responsible for c.70% of UK

total agricultural GHG emissions. Barclays is

setting a target to reduce the absolute emissions

(MtCO2e) of our UK Dairy and Livestock portfolio

by 21% by end of 2030, against a 2023 baseline –

in line with the Balanced Net Zero (BNZ) 1.5°C-

aligned scenario developed by the CCC.

To help advance approaches to Agriculture-

financed emissions measurement, and target

setting in the banking sector more broadly,

Barclays is a member of the Banking for Impact

on Climate in Agriculture (B4ICA) working group –

which produced an introductory guide on target

setting for the sector in 2022 and worked on a

further update over 2023.

|  |  |
| --- | --- |
|  |  |
| + | B4ICA Introductory guide can be found at: wbcsd.org/Focus-  Areas/Banking-for-Impact-on-Climate-in-Agriculture-B4ICA |
|  |

Barclays is also engaged in a three-year

collaboration with Oxford University to develop

food type production datasets for the UK. The

aim is to quantify Barclays-financed emissions in

more detail and consider additional transition

risks.

|  |  |
| --- | --- |
|  |  |
| + | Further details on our partnership with Oxford University  can be found at:  home.barclays/news/pressreleases/2022/10/  barclays-and-oxford-universityannounce- 3-year-agri-  climate-part/ |
|  |

|  |  |
| --- | --- |
|  |  |
| + | Further details on our financed emissions methodology can  be found in our latest Financed Emissions Methodology paper  (published in 2024) at: home.barclays/esg-resource-hub/  reporting-and-disclosures/ |
|  |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | Financed emissions - UK Agriculture: Dairy and Livestock  Absolute emissions (MtCO 2 e) (Indexed December 2023 = 100) | | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  | | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  | CCC - Synthetic BNZP Scenario: UK |  | Barclays' progress |  | Portfolio target path |  |
|  |  |  |  |  |
|  |  |  |  |  |  |  |  |

Note:

Δ    2023 data subject to independent limited assurance under ISAE

(UK) 3000 and ISAE 3410. Current limited assurance scope and

opinions can be found within the ESG Resource Hub:

home.barclays/sustainability/esg-resource-hub/reporting-and-

disclosures/

Future progress against this target

The general factors outlined on page [89](#i4be61753b7f243b19551b0bfbf3a2a0d_289) in

relation to progress against our targets will

equally be relevant to this portfolio. Additionally,

and more specifically, the transition of the UK

Dairy and Livestock sector is significantly

dependent on broader consumer behavioural

change and public policy interventions – which

are outside Barclays' control and may affect our

ability to achieve this target.

Further, we expect the data underlying the UK

Dairy and Livestock model to continue to evolve

and be refined in order to address the challenges

outlined above, and that this could impact our

metrics and this target.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 94 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

![41231686041619]()

Dec'23: 2.4  △

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| 2023 | 2025 | 2030 | 2040 |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Barclays' actions to decrease the emissions intensity of its Agriculture portfolio must be  complemented by public policy interventions to drive consumer and behavioural change. | | |
|  |  |  |
| Lever | Climate Change Committee's  description | Barclays' actions |
| Diet change  and food  waste | 20% reduction in meat and  dairy consumption (replaced  with plant-based), and 50%  reduction in food waste  (mostly holds) by end of 2030 | • Assess and support farmers' ability to adapt income streams  in line with changing consumer habits |
| Low-carbon  farming | Behavioural and innovative  measures to decarbonise food  production, such as cover  cropping and anaerobic  digestion | • Support farmers to implement low-carbon farming methods  through new and existing products  • Work across the supply chain to explore enabling low-carbon  farming methods for a greater number of farmers |
| Low-carbon  machinery | Electrification, hydrogen and  (later) phase-out of biofuels | • Offer customers incentives for renewables, including Green  Barclayloan, Agriculture Technology Fund, and Green Asset  Finance  • Work with the Agricultural machinery sector to understand  viability and availability of low-carbon machinery |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | image (3).png |  |
|  |  |  |
|  | Carbon Clarity partnership supports UK farmers  Launched in 2018, the Rebuilding Thriving Local Economies initiative was launched in four  locations across the UK to identify how Barclays can provide support over and above what we do  every day as a bank. By collaborating with local people and organisations, it has focused on  helping individuals develop skills and confidence – as well as supporting businesses to grow. In  2023 Barclays partnered with The Royal Countryside Fund to expand its Carbon Clarity  programme and provide free support for 53 farms in Somerset and Norfolk to understand how  they could better manage carbon. The programme offered an introduction to carbon reduction  on farms through group workshops, one-to-one support, and assistance in creating a carbon  ‘action plan’. |  |
|  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 95 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

UK Commercial Real Estate

The Commercial Real Estate (CRE) sector has a

role to play in the decarbonisation of UK

buildings, the second-highest-emitting UK

sector. CRE represents the next highest portion

of GHG emissions in that sector after residential

buildings, primarily from the fossil fuel heating

systems used. There are number of significant

challenges to decarbonising the entire UK

buildings sector, which require engagement and

systematic change, outside of Barclays’ control

and as further outlined on page [97](#i50d5ab8ef70741e386f1c4b1ec43a4bf_0-0-1-2-2552579). CRE sector

challenges are further compounded by the

added complexity of landlord-tenant dynamics –

which requires collaboration on minimising

energy use, sharing of energy data and

consideration of energy intensity of fit-outs and

retrofit solutions. Further, the diverse building

stock in the UK is likely to require tailored client

strategies for these retrofit solutions.

The different characteristics of the clients in this

portfolio – which include institutional real estate

investors and quoted real estate companies with

their own transition strategies and stakeholder

expectations – mean there are different and

additional potential drivers of transition in this

portfolio. Further, the relationship-led nature of

the UK Corporate Bank and its in-house asset

management expertise enables a client-first

approach to influence transition planning at a

portfolio level. We are therefore setting a target

for this portfolio but recognise that there are

significant challenges to achieving it as a result of

factors outside of Barclays' control.

Estimating our financed emissions

The in-scope portfolio represents the majority of

the UK commercial and residential real estate

investment financing to assets across a diverse

range of sub-sectors including office, retail,

industrial and logistics, and residential properties

managed within the UK Corporate Bank.

To support the transition of our commercial real

estate clients we have set a target to reduce the

financed emissions intensity (kgCO2e/m2) by

51% by end of 2030 against a 2023 baseline,

calculated using our BlueTrackTM methodology

and integrating the approach recommended by

PCAF.

The emission reductions required aligns with

CRREM 2022 – the leading global standard and

initiative for operational decarbonisation of real

estate assets – which provides the granularity of

pathways for sub-sectors within the in-scope

portfolio. We may expect our CRREM pathway to

change if the portfolio materially changes.

The high proportion of commercial properties

within scope has created challenges in data

matching to external sources. Consequently, we

are investing in our systems to increase the data

coverage and decrease the use of estimations in

our target setting in future years.

|  |  |
| --- | --- |
|  |  |
| + | Further details on our financed emissions  methodology can  be found in our latest Financed Emissions Methodology paper  (published in 2024) at: home.barclays/esg-resource-hub/  reporting-and-disclosures/ |
|  |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | Financed emissions - UK Commercial Real Estate  Physical Intensity (kgCO2e/m2) (Indexed December 2023 = 100) | | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  | | | | | |  |
|  |  |  |  |  |  |  |  |
|  |  | CRREM  II- 1.5 degree |  | Barclays' progress |  | Portfolio target path |  |
|  |  |  |  |  |
|  |  |  |  |  |  |  |  |

Note:

Δ    2023 data subject to independent limited assurance under ISAE

(UK) 3000 and ISAE 3410. Current limited assurance scope and

opinions can be found within the ESG Resource Hub:

home.barclays/sustainability/esg-resource-hub/reporting-and-

disclosures/

Future progress against this target

The general factors outlined on page [89](#i4be61753b7f243b19551b0bfbf3a2a0d_289) in

relation to progress against our targets will

equally be relevant to this portfolio. Additionally,

and more specifically, CRE is dependent on

broader industry and regulatory changes which

are required to deliver the decarbonisation of the

UK energy grid, the phasing-out of fossil fuel

heating, and the maturity of supply chain to

deliver the required retrofit solutions. Regulation

and policy advancement will also play a key role,

especially in relation to supporting low-carbon

heating and setting requirements in relation to

EPC standards. These changes are outside

Barclays' control and may affect our ability to

achieve this target.

|  |
| --- |
|  |
|  |

Further, as the data underlying our model

continues to evolve and be refined to address

the challenges outlined above, this could impact

our metrics and this target.

We will continue to engage with clients to

understand their approach to the transition and

how Barclays can best support – ranging from

education to tailored loan solutions. Over the

medium term, supporting new residential

developments through our Sustainable

Residential Development Framework – which

enables the classification and tracking of

residential development loans to our UK

Corporate Banking clients, as well as the

deployment of sustainability-linked loans – which

will support our housebuilding clients in achieving

their sustainability goals including reducing

emissions of new homes built.

|  |  |
| --- | --- |
|  |  |
| + | Read more about the Sustainable Residential  Development Framework here:  [.barclayscorporate.com/](https://www.barclayscorporate.com/content/dam/barclayscorporate-com/documents/solutions/corporate-banking-solutions/Green-solutions/Sustainable-residential-development-landscape.pdf)  [content/dam/barclayscorporate-com/documents/](https://www.barclayscorporate.com/content/dam/barclayscorporate-com/documents/solutions/corporate-banking-solutions/Green-solutions/Sustainable-residential-development-landscape.pdf)  [solutions/corporate-banking-solutions/Green-solutions/](https://www.barclayscorporate.com/content/dam/barclayscorporate-com/documents/solutions/corporate-banking-solutions/Green-solutions/Sustainable-residential-development-landscape.pdf)  [Sustainable-residential-development-landscape.pdf](https://www.barclayscorporate.com/content/dam/barclayscorporate-com/documents/solutions/corporate-banking-solutions/Green-solutions/Sustainable-residential-development-landscape.pdf) |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 96 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

![41231686043206]()

Dec'23:30.0  △

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| 2023 | 2025 | 2030 | 2040 |

|  |  |
| --- | --- |
|  |  |
| High-level assessment of drivers of net zero for UK buildings | |
| Driver | Barclays' role |
| Decreasing the emissions intensity of Barclays’ UK Housing and UK CRE portfolio is highly dependent on external changes and public policy interventions to deliver the drivers below | |
| Improvement in energy  efficiency of existing buildings | • Continue to offer education, financing products and services to incentivise retrofitting  • Advocating for external measures to drive take-up of retrofitting  • Support Social Housing providers and commercial landlords in their transition journey |
| Decarbonisation of UK  electricity grid | • Supporting our clients in the Power sector in their net zero transition  • Advocating for the UK Government to deliver on its ambitions to decarbonise the electricity grid |
| Phasing-out of fossil fuels in  heating | • Continue to offer education, products and services to incentivise customers switching to low-carbon heating |
| New homes built to net zero  standard | • Continue to promote energy efficiency in new builds through propositions such as Green Home Mortgages  • Continue supporting our Corporate Bank's real estate clients in their transition – for example through Barclays' Sustainable Residential Development Framework  • Continue supporting our Social Housing providers to provide energy-efficient, affordable new housing (to own and rent) |
| Behavioural change | • Continue to offer education to customers on energy efficiency and promote reduction of usage through tools, awareness and partnerships |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 97 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

UK Housing

Widened scope for UK Housing

Buildings contributed 17% of total UK GHG

emissions in 2022, of which residential buildings

represented 75% – primarily from the use of oil and

gas in  heating and  hot water. Decarbonising UK

homes is a complex challenge that will require

widespread engagement and systemic change.

In an effort to confront and quantify these

challenges we are expanding the scope of our

previously announced UK Residential Real Estate

convergence point. The expanded scope, renamed

to UK Housing sector, now includes Social Housing

and Business Banking Real Estate portfolios,

alongside the previous scope of Barclays UK

residential and Private Banking mortgage portfolios.

The real estate portfolios within the UK Housing

sector share similar underlying assets – 99% are UK

residential properties – thereby referencing the

same CCC BNZ pathway and sharing similar

decarbonisation levers. Barclays continues to

support the UK Housing sector through the

provision of mortgages, financing of social housing

providers and expanded product offerings designed

to support the decarbonisation of the UK Housing

stock.

|  |
| --- |
|  |
| Composition of UK Housing portfolio  Dec'23 |

![212755500105601]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| n | Barclays UK/Private bank Mortgages | | |
| n | Social Housing | n | Business Bank Real Estate |

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
|  | Financed emissions - UK Housing  Physical Intensity (kgCO2 e/m2 ) (Indexed December 2022 = 100) | | | | | |  |  |  |
|  |  |  |  |  |  |  |  |  |  |
|  |  | | | | | |  |  |  |
|  |  |  |  |  |  |  |  |  |  |
|  |  | CCC - Synthetic BNZP Scenario: UK | ▲ | Portfolio convergence point | // | Dec 2023 baseline for new UK Housing convergence point | | |  |
|  |  |  |
|  |  | Progress in 2023 for previously announced UK Residential Real Estate convergence point | | | | |  |  |  |
|  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |

|  |
| --- |
|  |
| Note:  Δ   2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can  be found within the ESG Resource Hub: home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/ |

Estimating our financed emissions

The decarbonisation of the UK Housing sector in

line with the CCC BNZ scenario depends mostly on

external changes and public policy interventions.

Without these external changes, Barclays cannot

materially decrease the emissions intensity of its UK

Housing portfolio. Barclays has therefore chosen to

identify the 2030 emissions intensity 'convergence

point' – and measure our progress towards it – but

not to set a formal target at this time. In 2022 we

estimated the financed emissions and emissions

intensity of our UK Residential Real Estate sector by

integrating the PCAF approach into BlueTrackTM.

|  |
| --- |
|  |
|  |

In 2023 the emissions intensity for that sector

increased by c.1% due to increased emissions

from the UK electricity grid – despite an

improvement in known EPC ratings for our

Barclays UK mortgage portfolio. Going forwards,

the additional portfolios making up the expanded

scope of the UK Housing sector will be tracked.

We continue to use the CCC BNZ scenario as the

benchmark for this sector as it is specific to the UK,

independent, developed by a credible institution and

aims to achieve net zero emissions for the UK by

2050. We are maintaining a convergence point of a

40% reduction in CO2e emissions intensity by the

end of 2030. However, to reflect the expanded

scope, this will now be against a 2023 baseline for

the UK Housing sector.

|  |  |
| --- | --- |
|  |  |
|  | Further details on our financed emissions methodology can  be found in our latest Financed Emissions Methodology paper  at: home.barclays/esg-resource-hub/reporting-and-  disclosures/ |
| + |
|  |

Drivers of reduction in emissions

in UK Housing

Key drivers in the transition to net zero in the UK

Housing sector are the decarbonisation of the

UK electricity grid and the phasing-out of fossil

fuels in domestic heating through the switch to

low-carbon heating – bringing cleaner energy

into our customers' homes. This will largely be

driven by the transition of the Power sector

alongside UK Government policy to drive the

decarbonisation of the UK electricity grid and

promote take up of low-carbon heating. Barclays

can play a role through supporting renewable

energy projects and clients in the Power sector,

through Sustainable and Transition Finance

activity and through Sustainable Impact Capital

investments.

Another key driver required to reach net zero in

the UK Housing sector is to improve the energy

efficiency of existing homes – which includes

improving the fabric of homes and adopting

other energy efficiency measures. Other key

contributors include new homes being built to

net zero standard, with low-carbon energy

sources and high energy efficiency ratings, and a

reduction in energy consumption through

changes in behaviour.

|  |  |
| --- | --- |
|  |  |
| + | Read more about the Barclays-commissioned report from  Ipsos UK on consumer retrofitting behaviour on  page [112](#i4be61753b7f243b19551b0bfbf3a2a0d_7746). |
|  |

As a mortgage lender to retail and business

banking clients, we can support customers who

choose to retrofit their properties, switch to low-

carbon heating, and explore ways to reduce their

energy consumption by providing financial

products, services and partner offers.

|  |  |
| --- | --- |
|  |  |
| + | Further details on our Greener Homes Propositions can be  found on page [111](#i4be61753b7f243b19551b0bfbf3a2a0d_7248). |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 98 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

![42880953483551]()

// Dec'23: 32.1 △

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| 2022 | 2023 | 2025 | 2030 | 2040 |

Our Social Housing business engages with clients

on ESG, including where they are on their

transition journey and what we can do to support

them. The sector is already demonstrating above-

average energy efficiency in portfolios and many

housing associations have a stated objective of

moving stock to EPC C or better by 2030. Aligned

to this objective the sector’s energy efficiency has

been improving – and we are seeing examples of

deep retrofit projects and newly delivered housing

schemes with properties rated EPC band A/B.

As an established lender to the Social Housing

sector, we continue to be an active market

participant, are structuring some of our loans with

sustainability metrics where this is within client

appetite, and have amended covenant terms we

are prepared to accept to support retrofit.

However, we expect the overall impact of our

actions to be low given the barriers to retrofitting

– such as high upfront costs and current low

customer demand due to low incentives to

change. Additionally, the potential management

actions available to Barclays are limited due to

this being a portfolio of customers or end users

who are retail in nature, and predominantly

consisting of residential properties.

To see more about Barclays actions with regards

to the drivers of net zero for UK Buildings, please

refer to the table on page [97](#i50d5ab8ef70741e386f1c4b1ec43a4bf_0-0-1-2-2552579) above for details of

Barclays' approach to drivers in UK buildings.

Our EPC ambition

Barclays is expanding its EPC ambition scope1 to

include Social Housing, Business Banking Real

Estate and Kensington Mortgage Company

Limited2, alongside the previous scope of the

Barclays UK mortgages portfolio.

In line with our efforts to improve the energy

efficiency of our UK Housing portfolio, Barclays

has set an updated EPC ambition of 55% of

properties and collateral in scope of our EPC

ambition – with a known EPC to be rated band C

or better by 2030.

As at the end of Q3 2023, 47.9%3 of Barclays

properties and collateral in scope of our EPC

ambition with a known EPC were rated band C or

better.

There are industry-wide challenges to ensure the

properties in our portfolio have EPC certificates,

given approximately one-third of housing stock

in England and Wales does not have a valid EPC

rating.

|  |
| --- |
|  |
| EPC   ratings of properties and collateral  in scope of EPC ambition4 |

2023 total: 744,098

|  |  |
| --- | --- |
|  |  |
| 18,051 |  |
|  |
|  |

![42880953625738]()

|  |  |
| --- | --- |
|  |  |
|  | 3,601 |
|  |
|  |  |
|  | 2,227 |

|  |  |
| --- | --- |
|  |  |
| n | EPC rating G |
| n | EPC rating F |
| n | EPC rating E |
| n | EPC rating D |
| n | EPC rating C |
| n | EPC rating B |
| n | EPC rating A |
|  |  |

|  |
| --- |
|  |
|  |
| 47.9%  of properties and collateral rated  A-C of available EPCs |

Notes

1 EPC ambition scope does not currently include Private Bank due

to EPC data reporting limitations.

2 Kensington Mortgage Company Limited is not currently included

in UK Housing sector emissions intensity convergence point due

to portfolio reporting limitations.

3 Metric based on number of properties and collateral in portfolios

that make up the EPC ambition scope as of 31 December 2023.

4 EPC data for Barclays UK mortgages and Kensington Mortgage

Company Limited are as of 30 September 2023. Matched EPC

data for Social Housing and Business Banking Real Estate are as

of 31 October 2023.

Ongoing work on portfolio alignment

As part of our commitment under the NZBA, we

have set targets for material1 high-emitting

sectors in our portfolio.

Using BlueTrackTM, we have assessed our

financed emissions and have targets for eight

high-emitting sectors. These targets cover our

Energy, Power, Cement, Steel, Automotive

manufacturing, Agriculture, Aviation, and CRE

portfolios. We have also set a convergence point

for UK Housing.

We previously assessed financed emissions for

Aluminium – and, during 2023, for Shipping – but

decided against setting targets. For Aluminium,

this was the result of a detailed review of our

Metals (Steel and Aluminium) portfolios, which

found that Barclays does not have a material

exposure to the Aluminium sector2. For Shipping,

as explained on page [85](#i4be61753b7f243b19551b0bfbf3a2a0d_16882) in relation to material

sectors and net-zero-aligned targets, our

assessment identified that due to our limited

financing volumes and financed emissions across

a small number of clients it would be difficult to

set a target at this time.

During 2023 we also developed a high-level

modelled assessment of the emissions

associated with our financing activities across

our portfolio, largely aligned to the PCAF

Standard – including undrawn commitments,

contingent liabilities and capital markets

financing.

|  |  |
| --- | --- |
|  |  |
| + | See section Reducing our financed emissions  on page  [80](#i4be61753b7f243b19551b0bfbf3a2a0d_283). |
|  |

We intend to build on this assessment to deepen

our understanding of the emissions associated

with our financing activities. Informed by this

work, we intend to consider the most appropriate

approach to extend our target coverage with the

aim of ensuring it covers relevant areas of the

value chain and/or our financing activities.

Together, our work to set financed emissions

reduction targets as part of our commitment to

the NZBA, and to establish a baseline

assessment of the emissions associated with our

financing activities consistent with the PCAF

Standard, will aid our understanding of the extent

to which our financing aligns with the goals and

timelines of the Paris Agreement.

During 2024 we intend to further develop our

approach to the implementation of the

Transition Plan Taskforce (TPT)'s

recommendations – and to include information

relating to transition planning in future climate

disclosures. As part of this, we intend to develop

Sector Transition Strategies aimed at

summarising our approach to support the

transition in a particular sector.

Notes:

1 As defined in Foundations of Climate Mitigation Target Setting

published by the UNEP Finance Initiative (unepfi.org/wordpress/

wp-content/uploads/2022/05/Foundations-for-climate-

mitigation-target-setting.pdf).

2 With the exception of diversified mining companies where

aluminium production is a small element of their overall activities,

and where it would therefore be difficult to set standalone

aluminium emissions intensity reduction targets.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 99 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

Restrictive policies

In addition to setting sector-specific emission

reduction targets, consistent with our Purpose

and driven by consideration of all relevant risks

and other factors, we have set explicit

restrictions to curtail or prohibit financing of

certain activities in sensitive sectors. These

policies are listed below and set out in detail

within our statements and policy positions.

Our restrictive policies are regularly reviewed and

updated in light of the rapidly changing external

environment and are informed by engagement

with our stakeholders, including shareholders,

clients, subject specialists and civil society

groups. In 2023 this included a review of nature-

related impacts and dependencies and social

risks of different technology types to help inform

our approach to due diligence.

Our Climate Change Statement sets out our

positions and approach to sensitive sectors with

tightening policy criteria and increasing

expectations over time. In 2024 we have updated

the Climate Change Statement to include new

requirements for upstream oil and gas and

restrictions on the type of exposures and risk we

will finance going forward, as well as additional

restrictions on financing in relation to the

Amazon Biome, ultra-deep water and extra

heavy oil).

For further details on the scope and application

of the updated positions please see page [63](#i1da7e4cdbdd3469288df15f121af8119_2-1-1-1-2557910).

Barclays will continue to support an energy

sector in transition, focusing on the diversified

energy companies investing in low carbon and

with greater scrutiny on those engaged in

developing new upstream oil and gas projects.

The experience of the last few years leads us to

recognise that client transition pathways will vary

and the ability of our clients to meet our

requirements may be affected (positively or

negatively) by external factors, including, for

example, the public policy and regulatory

environment, technological advancement,

geopolitical or regional developments, energy

security, cost of living and just transition factors.

We intend to continue to work with and support

our clients as they transition their business and

will monitor and engage with them on their

progress and the impact of external factors over

time, through our Enhanced Due Diligence and

Client Transition Framework.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  | Position and policy statements on sensitive sectors | | | |  |
|  |  |  |  |  |  |
|  | Climate change | |  | Forestry and Agricultural  commodities |  |
|  |  | |  |  |  |
|  | • ` | |  | • Timber, pulp and paper  • Palm oil  • Soy  • Beef (new) |  |
|  |  | |  |  |  |
|  | + | Further details can be found at:  [home.barclays/sustainability/esg-resource-hub/statements-and-policy-positions/](https://home.barclays/sustainability/esg-resource-hub/statements-and-policy-positions/) | | |  |
|  |  |  |
|  |  |  |  |  |  |

We anticipate that companies which are unable

or unwilling to reduce or eliminate their emissions

consistent with internationally accepted

pathways may find it increasingly difficult to

access financing, including through Barclays.

Further restrictions are set out in our Position

Statements relating to Forestry & Agricultural

Commodities as well as World Heritage Site and

Ramsar Wetlands, which were reviewed in April

2023. In the latter case only minor changes were

made.

We will continue to keep our policies, targets and

progress under review in light of the output of

both EDD and CTF reviews, the rapidly changing

external environment and the need to support

governments and clients, in our efforts to meet

our ambition of being a net zero bank by 2050.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Forestry and Agricultural  Commodities Statement |  |
|  |  |  |
|  | Barclays recognises the critical importance  of addressing deforestation in delivering on  global climate and biodiversity goals. A major  cause of deforestation is the production of  forestry and agricultural commodities such  as timber, beef, palm oil and soy, and we  have a position statement and due diligence  approach that applies to clients involved in  these activities (first published in 2019 for  forestry and palm oil and refreshed in 2020  to include soy).  We have engaged with investors, clients and  civil society organisations on this topic,  which has informed a review of our Forestry  and Agricultural Commodities Statement.  This was updated in April 2023 with a number  of significant changes.  The updated Statement now covers clients  involved in South American beef production  or primary processing, and enhances the  existing requirements for clients involved in  soy and palm oil. Among other criteria, the  Statement requires that these clients  commit to having fully traceable and  deforestation-free commodity supply chains  by the end of 2025 – a position aligned with  industry good practice guidance such as the  Accountability Framework Initiative¹ and  Agriculture Sector Roadmap for 1.5°C².  In addition, the Statement requires that  clients prohibit the production or primary  processing of soy or beef from deforested  areas of the Amazon, in recognition of the  critical nature of this biome to biodiversity  and climate objectives.  Notes:  1 accountability-framework.org/  2 tropicalforestalliance.org/en/collective-action-agenda/  cop27-roadmap/ |  |
|  |  |  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 100 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 2 |

|  |  |
| --- | --- |
|  |  |
| + | For further information, please see our Forestry and  Agricultural Commodities Statement:  [home.barclays/](https://home.barclays/content/dam/home-barclays/documents/citizenship/our-reporting-and-policy-positions/Forestry-and-Agricultural-Commodities-Statement.pdf)  [content/dam/home-barclays/documents/citizenship/our-](https://home.barclays/content/dam/home-barclays/documents/citizenship/our-reporting-and-policy-positions/Forestry-and-Agricultural-Commodities-Statement.pdf)  [reporting-and-policy-positions/Forestry-and-Agricultural-](https://home.barclays/content/dam/home-barclays/documents/citizenship/our-reporting-and-policy-positions/Forestry-and-Agricultural-Commodities-Statement.pdf)  [Commodities-Statement.pdf](https://home.barclays/content/dam/home-barclays/documents/citizenship/our-reporting-and-policy-positions/Forestry-and-Agricultural-Commodities-Statement.pdf) |
|  |

|  |  |
| --- | --- |
|  |  |
|  | Financing the transition |
|  |  |
|  | In light of the progress made against our  previously announced targets, and after a  strategic review of the Group's capabilities,  market demand and growth opportunities, in  December 2022 we announced a new target  to facilitate $1trn of Sustainable and  Transition Financing between 2023 and the  end of 2030. We also announced an  extension of our Sustainable Impact Capital  portfolio, with a new mandate to invest up to  £500m into global climate tech start-ups by  the end of 2027. |
|  |  |

Facilitating $1trn of Sustainable and

Transition Financing

At Barclays we are clear that addressing climate

change is a complex challenge that demands a

fundamental transformation of the global economy.

Low-carbon technologies, infrastructure and

capacity must be scaled up to meet growing energy

demands and for the world to reach net zero. The

financial sector has an important role to play in

supporting the transition and we are determined to

play our part. We are deploying financing to help

scale-up the necessary activities needed in the

transition to net zero.

|  |  |
| --- | --- |
|  |  |
| + | For further details on climate-related  opportunities see page  [70](#i4be61753b7f243b19551b0bfbf3a2a0d_256). |
|  |

In December 2022 we announced a new target,

to facilitate $1trn of Sustainable and Transition

Financing between 2023 and the end of 2030.

This followed our two previously announced

targets: to deliver £150bn of social,

environmental and sustainability-linked financing

by 2025, which we surpassed in 2021, and to

deliver £100bn of green financing by 2030, which

we surpassed in 2023.

Our $1trn target encompasses the green, social,

transition and broader sustainability-linked

financing requirements of clients including

corporates, governments and the public sector,

financial institutions and consumers. This

includes financing of climate and environmental

solutions including green mortgages, energy-

efficient technology and renewable energy, as well

as financing for broader social and sustainability

work – including sustainability-linked structures and

areas such as affordable housing. We are also

facilitating funding into green technologies and low-

carbon infrastructure projects, as well as using our

advisory capabilities, product sets and financial

expertise to help our customers and clients realise

their own transitions to a low-carbon economy.

The inclusion of transition financing in this target

reflects our recognition of the importance of

supporting the decarbonisation of hard-to-abate

sectors that are carbon intensive. In early 2024 we

announced our Transition Finance Framework

(TFF), which outlines the criteria for transactions to

qualify as transition financing and sits alongside our

Sustainable Finance Framework (SFF) to define

what can be included against this target.

|  |  |
| --- | --- |
|  |  |
| + | Examples of qualifying transactions can be seen in our case  studies on pages [30](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680602), [115](#i4be61753b7f243b19551b0bfbf3a2a0d_7590) and [116](#ie584fd4d4a7d4bcfbcaa397cd2ae9993_1-1-1-1-2521842). |
|  |

Our ability to meet the $1trn target and progress

towards it from year to year will be dependent on

a number of factors and variables outside our

control. Factors such as market conditions,

policy, laws, regulation, geopolitical

developments and stakeholder expectations -

including approaches to product labelling and

regulatory scrutiny of green, sustainability-linked

and social products - could impact lending and

capital markets appetite and our approach to risk

management, and therefore present a risk to our

progress against, and delivery of, the target.

Additionally, new climate and decarbonisation

technologies may scale at varying rates, including

being reliant on the supply and demand of raw

materials, which may impact financing volumes.

We will continue to review and adapt our approach

to Sustainable and Transition Financing in

response to the evolving market opportunities.

Progress against our $1trn target

During 2023 we facilitated $67.8bnΔ of Sustainable

and Transition Financing, of which $67.4bn was

sustainable financing, slightly up on 2022 of $65.3bn,

and $0.4bnΔ was transition financing that qualified

against our new Transition Finance Framework. Our

facilitation of $67.8bnΔ of Sustainable and Transition

Financing in a challenging market demonstrates our

continued focus on supporting our clients on their

sustainability journeys.

Bond issuance1 was the largest product category in

2023, accounting for 76% of total Sustainable and

Transition Financing while loans and equity

accounted for 19% and 3% respectively. This mix

showed a small shift towards bond activity and away

from loans compared to the mix of our 2022

sustainable financing of $65.3bn, which comprised

71% bond issuance, 26% loans and 2% equity.

Sustainable finance

Sustainable financing, aligned to our Sustainable

Finance Framework, consists of financing for

dedicated use of proceeds, financing for clients

with an eligible business mix in relevant

environmental and social categories, and

sustainability-linked financing which refers to

general purpose funding.

Social financing

Raising finance for clients including

supranational, national and regional development

institutions was a key driver of the $32.4bnΔ of

social financing facilitated in 2023 (2022:

$30.0bn). In 2023, we continued to see issuers

aligning their financing commitments to social

use of proceeds bonds which allocate funds to

categories such as access to healthcare,

affordable housing and essential services. As in

2022, we have also seen the use of social KPIs

within sustainability-linked financing such as

targets linked to gender diversity.

Environmental financing

In 2023, we facilitated $24.1bnΔ of environmental

financing (2022: $21.7bn). This performance

reflected continued demand from our clients and

our strategy to work with them to help facilitate

their transitions to a low-carbon economy.

Sustainability-linked financing

Sustainability-linked bonds (SLBs) and

sustainability-linked loans (SLLs) are forward-

looking, performance-based debt instruments

issued with specific sustainability performance

targets. Our sustainability-linked financing

totalled $10.9bnΔ in 2023 (2022: $13.7bn). The

sustainability-linked market continues to be of

importance to both investors and issuers alike

who use these instruments to embed their

sustainability targets into financing commitments

and we look forward to continuing to work with

our clients to innovate the product set.

Note

Δ    2023 data subject to independent limited assurance under ISAE

(UK) 3000 and ISAE 3410. Current limited assurance scope and

opinion can be found within the ESG Resource Hub:

home.barclays/sustainability/esg-resource-hub/reporting-and-

disclosures/

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 101 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

Transition financing

In 2023, we facilitated $0.4bnΔ of transition

financing under our new Transition Finance

Framework. While new technologies are still

emerging, we are identifying opportunities to

finance decarbonisation pathways across high-

emitting sectors, including energy, power,

chemicals, and metals. We are looking to play

a role in supporting a range of carbon and

emission reduction projects – from the

manufacturing of blue hydrogen and related

infrastructure for end-use sectors with limited

decarbonisation alternatives, to the

electrification of compressor units, resulting in

the elimination of natural gas use, as well as the

adoption of low-carbon technologies, As

emerging technologies scale and continue to

develop, we are committed to leveraging our

expertise to further identify opportunities for

transition financing.

|  |  |
| --- | --- |
|  |  |
| + | For further details on our Sustainable Finance Framework  and Transition Finance Framework see page [104](#i4be61753b7f243b19551b0bfbf3a2a0d_331). |
|  |

Facilitating £100bn of green financing

Since 2018 we have facilitated a total of

£113.7bnΔ green financing – exceeding our

target of £100bn well ahead of the 2030 target

date.

In 2023 we facilitated £ 25.9bnΔ (2022: £25.5bn),

comprising:

• Labelled use of proceeds and general purpose

financing in environmental categories of

£19.8bnΔ (2022: £18.0bn)

• Sustainability-linked financing that

incorporates environmental performance

targets of £6.2bnΔ (2022:£7.5bn).

Breaking down our green financing by product

type, the largest category in 2023 was bond

issuance – accounting for 63% of the total (2022:

61%). Loans and equity made up 30% (2022:

33%) and 6% (2022: 4%) respectively.

Notes

1 Bond issuance includes Bonds (DCM), CMBS, Securitization,

Munis and PCM Debt.

Δ    2023 data subject to independent limited assurance under ISAE

(UK) 3000 and ISAE 3410. Current limited assurance scope and

opinion can be found within the ESG Resource Hub:

home.barclays/sustainability/esg-resource-hub/reporting-and-

disclosures/

Sustainable Impact Capital portfolio:

Mandate to invest up to £500m into

global climate technology start-ups

We firmly believe that innovation is key to tackling

climate change and we are committed to

supporting transformative change by investing

our own capital in entrepreneurial companies. In

2020 Barclays announced that it would invest up

to £175m equity capital in environmentally

focused climate technology companies by 2025

– helping support our clients to transition

towards a low-carbon economy, scale solutions

to environmental challenges, and fill their

growth-stage funding gaps.

In evidence of the success of the investments, in

December 2022 we announced an increase of

the investment mandate to invest up to £500m

by the end of 2027.

To date we have invested £138m into 21

innovative companies. These investments have

supported many aspects of climate tech

innovation, from property retrofit solutions to

long-duration energy storage and hydrogen

technologies.

We continue to drive wider commercial and

strategic opportunities for Barclays UK,

Corporate Banking and Investment Banking with

those companies.

We continue to focus on decarbonisation

technologies supporting transition within

carbon-intensive sectors, particularly where

Barclays has meaningful client exposure – such

as Power, Industry, Transport, Agriculture and

Real Estate – including solutions delivering

carbon capture, carbon dioxide removal and

green hydrogen.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 102 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

|  |
| --- |
|  |
| Sustainable finance dashboard |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| $1trn Sustainable and Transition Financing facilitated  (2023-2030)\* |  | Achieved to date  $67.8bn Δ |

|  |
| --- |
|  |
| Annual breakdown by category  ($bn) |

|  |
| --- |
|  |
| 2023 |

![41231686041724]()

|  |
| --- |
|  |
| 2022 |

![41231686041728]()

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| n | Environmental | n | Social | n | Sustainability-linked | n | Transition |

|  |
| --- |
|  |
| Annual breakdown by region  ($bn) |

|  |
| --- |
|  |
| 2023 |

![41231686041735]()

|  |
| --- |
|  |
| 2022 |

![41231686041739]()

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| n | Americas | n | UK/Europe | n | Asia and Rest of World |

|  |
| --- |
|  |
| Annual breakdown by product  ($bn) |

|  |
| --- |
|  |
| 2023 |

![41231686041746]()

|  |
| --- |
|  |
| 2022 |

![41231686041750]()

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
| n | Bonds | n | Equity | n | Loans | n | Investments | n | Other (Contingent) |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| £100bn green financing facilitated  (2018-2030) |  | Achieved to date  £113.7bnΔ |

|  |
| --- |
|  |
| Breakdown by year  (£bn) |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |
| 2020 |
| 2019 |
| 2018 |

![41231686041759]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| n | Environmental | n | Sustainability-linked (green) |

|  |
| --- |
|  |
| Breakdown by region  (£bn) |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |
| 2020 |
| 2019 |
| 2018 |

![41231686041766]()

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| n | Americas | n | UK/Europe | n | Asia and Rest of World |

|  |
| --- |
|  |
| Breakdown by product  (£bn) |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |
| 2020 |
| 2019 |
| 2018 |

![41231686041773]()

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
| n | Bonds | n | Equity | n | Loans | n | Investments | n | Other (Contingent) |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Notes  Δ  2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub  \* FY 2022 financing figures are provided only to facilitate comparison and do not count towards the target. FY 2022 numbers are converted based on year-end FX closing (spot) rate. |  | + | Further details of the data provided, including further granularity of decimal points  can be found in the ESG Data Centre located within the ESG Resource Hub at  home.barclays/sustainability.esg-resource-hub/reporting-and-disclosures/ |
|  |  |

|  |  |
| --- | --- |
|  |  |
| + | For further details:  home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/ |
|  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 103 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

Barclays' Sustainable and Transition

Finance Frameworks

Sustainable Finance Framework

We seek to be transparent about our approach

to reporting against our sustainable finance

targets. Our sustainable financing is tracked

using the methodology set out in the Barclays

Sustainable Finance Framework (SFF). This

framework defines the criteria we use for social

financing, sustainable  financing , green financing

and sustainability-linked financing. This includes

‘dedicated purpose’ green and social financing,

‘general purpose’ financing based on eligible

company business mix and sustainability-linked

financing, and sets out applicable criteria drawing

on industry guidelines and principles.

It should be noted that the methodology is reliant

on a range of data sources including Dealogic

and Bloomberg transaction listings and league

tables, as well as other third-party data and

verification sources including company

disclosures to aid the classification of financing

into eligible green and social categories.

We recognise that the quality, consistency and

comparability of the data relied upon is not yet of

the same standard as more traditional financial

metrics and presents an inherent limitation to

the performance reported. We will continue to

review available data sources and enhance our

methodology and processes to improve the

robustness of the performance disclosed.

The legal and regulatory landscape relating to

sustainable financing – including the naming and

categorisation of products as ‘green’, ‘social’,

‘sustainability-linked’ and otherwise – is rapidly

evolving with differing regulations across

jurisdictions. We may wish to revisit our approach

in that context in the future.

There is currently no globally accepted

framework or definition (legal, regulatory or

otherwise) governing what constitutes 'ESG',

'green', 'sustainable', or similarly labelled products

– nor is there unanimous agreement on what

attributes a particular investment, product or

asset should have to be labelled as such.

Furthermore, no assurance can be given that a

globally accepted definition or consensus will

develop over time. We will continue to monitor

and comply with applicable jurisdictional

regulatory taxonomy definitions and product

labelling obligations as they emerge.

As innovation in sustainable finance continues to

accelerate, we will continue to review and update

our SFF, our measurement of our performance

against targets, and keep our general approach

under review.

We have updated our SFF to version 4.1,

published in February 2024, which will apply to

financing volumes from January 2024 tracked

against our target to facilitate $1trn of

Sustainable and Transition Financing between

2023 and the end of 2030.

|  |  |
| --- | --- |
|  |  |
| + | Barclays' Sustainable Finance Framework can be found  online in our ESG Resource Hub at: home.barclays/  sustainability/esg-resource-hub/reporting-and-disclosures/ |
|  |

Transition Finance Framework

Our transition financing is tracked using the

methodology set out in the Barclays Transition

Finance Framework (TFF).

Barclays has developed and published in February

2024 the first version of the TFF for classifying

financing as 'transition' for the purpose of

tracking and disclosing our performance against

our target to facilitate $1trn of Sustainable and

Transition Financing between 2023 and the end

of 2030.

The inclusion of transition financing in this target

reflects our recognition of the importance of

lending, facilitating funding and investing in

technologies and activities that support GHG

emissions reduction, directly or indirectly, in

high-emitting and hard-to-abate sectors.

The TFF is complementary to our Sustainable

Finance Framework, The TFF augments the

scope of Barclays' SFF and determines the

eligibility of transition activities that sit outside

the sustainable finance already covered by

the SFF.

As there is no universal consensus as to how to

define 'transition' activities, Barclays has

developed its own definition of transition finance

as follows:

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Our definition of transition finance |  |
|  |  |  |
|  | Transition finance is any financing including  lending, capital markets and other  financing solutions provided to clients for  activities – including technologies – that  support GHG emissions reduction directly  or indirectly in high-emitting and hard-to-  abate sectors towards a 1.5°C pathway. |  |
|  |  |  |

The TFF outlines the criteria for eligible

transactions with a set of defined principles to

guide us in the application of our definition of

transition finance as we support high-emitting

clients and finance real economy

decarbonisation.

As innovation and market principles in relation to

transition finance continue to accelerate and

evolve, we will continue to consider and develop

our definition of transition finance and the

coverage under the TFF.

|  |  |
| --- | --- |
|  |  |
| + | Barclays' Transition Finance Framework can be found online  in our ESG Resource Hub at: home.barclays/sustainability/esg-  resource-hub/reporting-and-disclosures/ |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 104 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Financing nature | | | | | | | |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | As we execute our sustainable finance strategy,  we aim to identify opportunities to play a role in  supporting the financing of nature – in particular  by bringing together our combined retail,  corporate and investment banking activities. In  2023 we identified the opportunity for Barclays  to contribute to the goal of a nature-positive  food system as one of three strategic themes  during the development of our Group  sustainable finance strategy. Although our  financing activities in relation to nature may still  be relatively nascent, we are aiming to expand  on these and have provided some examples of  progress made and initiatives developed in  2023 below. | |  | In Barclays UK we believe nature is a key area  where we can make an impact, due to our  prominent role in financing UK agriculture and  agricultural land purchases. During the past  year we have lent funds to customers to  purchase land for deployment under the  Biodiversity Net Gain scheme, and supported a  leading wilding estate in commercialising its  activities as it prepares for future sales from  nature-positive outcomes. We also support  farmers who seek to apply more sustainable  farming practices, and have been actively  investigating how we can support farmers to  safely access private nature markets. Finally,  Barclays Eagle Labs is supporting a Venture  Launchpad cohort run by Carbon13 – focused  on Land, Food and Nature. | |  | We are supporting environmentally focused  start-ups through our Sustainable Impact  Capital (SIC) portfolio, led by Barclays’ Principal  Investments team – which has a mandate to  invest up to £500m by the end of 2027 in the  equity of these companies, which target the  goals and timelines of the Paris Agreement.  We are also actively developing nature-related  products and solutions to support our clients in  the Corporate and Investment Bank. In 2023  we strengthened our coverage of Agriculture  and AgTech companies through a senior hire in  our Sustainable and Impact Banking team. | |  | We are also exploring other innovative financial  structures that can redirect financing at scale  towards nature, such as debt for nature swaps.  In addition to client offerings, we have also  identified the need to build institutional capacity  to enable us and the broader industry to tackle  the technical challenges involved in scaling  financing towards nature-based solutions. | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  | In 2023 SIC invested in Agricarbon, a UK-  based company that has developed market-  leading soil carbon measurement technology,  to support the growth of regenerative  agricultural practices.  Agricarbon’s end-to-end measurement  process – which involves automating lab-  based processes, including elemental analysis  – addresses the gap in the market for  scalable, high-accuracy soil carbon  measurement.  Agricarbon has grown rapidly since its  commercial launch in 2021, and the company  already serves an international client base  including some of the world’s largest food and  beverage companies, carbon project  developers, and natural capital asset  managers. With the proceeds from the  fundraising, Agricarbon is seeking to  accelerate its international expansion. |  |  |  | Financing coastal nature-based solutions  document  The Sustainable Markets Initiative (SMI)  Financial Services Task Force ( FSTF) is a  group of CEO-level executives from some of  the world’s largest banks. It brings together  financial services leaders to develop and  enable solutions that aim to help facilitate the  transition to sustainable markets and support  the rapid decarbonisation required across the  real economy.  Barclays is a member of the FSTF and this  year, alongside HSBC and with support from  Pollination, developed the Financing Coastal  Nature-based Solutions (NbS) document.  The document serves as a practitioner’s  guide to building awareness and addressing  key potential considerations for embedding  coastal NbS in financial structuring. |  | The guide identifies key considerations for  financing coastal NbS projects in terms of  commercial viability, risk mitigation and impact  reporting through practical case studies,  including a carbon credit project and debt  conversion structures. The guide was  produced as a foundational resource for  building institutional capacity to understand  coastal NbS within the context of the financial  services industry. We expect the points raised  in the guide, which includes the role of  different asset classes in shifting capital  towards coastal NbS, to evolve, incorporating  the latest trends in coastal NbS financing. |  |  |
|  |  | Supporting soil through technology  investment  Regenerative agricultural practices have  significant potential to support climate  change mitigation and enhance the resilience  of food value chains through improved soil  health. Accurate measurement of soil carbon  is a factor constraining the growth of  regenerative practices in UK agriculture,  where Barclays has a strong presence.  The market for scalable, high-accuracy soil  carbon measurement is nascent, with several  early-stage companies pioneering new  technologies. |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | BAR_NVI_S_304 (1).jpg |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 105 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

|  |  |
| --- | --- |
|  |  |
| + | The full Financing Coastal Nature-based solutions  document can be found at this link [a.storyblok.com/](https://a.storyblok.com/f/109506/x/6298e4ed77/2023-11-22_fstf-financing-coastal-nbs-report_final.pdf)  [f/109506/x/6298e4ed77/2023-11-22\_fstf-financing-](https://a.storyblok.com/f/109506/x/6298e4ed77/2023-11-22_fstf-financing-coastal-nbs-report_final.pdf)  [coastal-nbs-report\_final.pdf](https://a.storyblok.com/f/109506/x/6298e4ed77/2023-11-22_fstf-financing-coastal-nbs-report_final.pdf)  Further details on the SMI can be found  on page [127](#i4be61753b7f243b19551b0bfbf3a2a0d_7887) . |
|  |

![Img_19.png]()

How our sustainable financing

supports the Sustainable

Development Goals (SDGs)

The 2030 Agenda for Sustainable Development,

adopted by all United Nations Member States in

2015, provides a shared blueprint for peace and

prosperity for people and the planet – now and

into the future.  At its heart are the 17 SDGs,

which are a call for action by all countries –

developed and developing – in a global

partnership. Barclays is pleased to play its part,

working in partnership with our stakeholders to

support the delivery of the SDGs.

Since 2018 we have tracked our annual

contribution to the SDGs through our financing

activities. An illustrative breakdown of how our

social and environmental financing contributes to

the SDGs is provided in the chart opposite.

Our financing covers a range of activities

including debt and equity capital markets,

corporate lending, trade finance and consumer

lending. It helps to generate positive social and

environmental outcomes through financing of

activities such as, but not limited to, energy

efficiency, renewable energy, affordable housing,

basic infrastructure and services. Financing of

activities set out in our SFF in turn supports

progress towards achieving the SDGs.

For a full list of eligible social and environmental

activities see the SFF, which shows how eligible

social and environmental activities contribute to

individual SDGs – supported through an analysis

of the underlying SDG targets. As we evolve our

understanding of how our financing contributes

to the SDGs, we will refine our methodology

accordingly.

![10]()

Beyond our financing activities, our community

programmes contribute to Goal 8: decent work

and economic growth.

We also contribute to the SDGs through our

work implementing the UN Principles for

Responsible Banking (PRB), and continue to

analyse the potential positive and negative

impacts of our business through these principles.

Barclays has set targets in line with some of our

significant impact areas to drive alignment with

the goals and timelines of the Paris Agreement

and to contribute to the SDGs.

|  |  |
| --- | --- |
|  |  |
| + | For further details, our PRB disclosure can be found online in  our ESG Resource Hub at:  home.barclays/sustainability/esg-  resource-hub/reporting-and-disclosures/ |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 106 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

|  |
| --- |
|  |
| SDG illustrative breakdown of 2023 social and environmental financing |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  |  | | 0.2 | | 0.2 | | 0.1 | |
|  |  |  |  |  |  |  |  |  |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| E_SDG_PRINT-07.jpg |  | E_SDG_PRINT-01.jpg |  | E_WEB_09.png |  | E_SDG_PRINT-03.jpg |  | E_SDG_PRINT-11.jpg |
| 6.5bn |  | 4.1bn |  | 4.1bn |  | 4.0bn |  | 4.0bn |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| n | No poverty |  | n | Clean water and sanitation |  | n | Reduced inequalities |  | n | Climate action |
| n | Zero hunger |  | n | Affordable and clean  energy |  | n | Sustainable cities  and communities |  | n | Life below water |
| n | Good health and wellbeing |  | n | Decent work and  economic growth |  | n | Responsible consumption  and protections |  | n | Life on land |
| n | Quality education |  |  |  |  |  | n | Peace and Justice Strong  Institutions |
| n | Gender equality |  | n | Industry, innovation  and infrastructure |  |  |  |  |  |
|  |  |  |  |  |  |  |  | n | Partnerships for the goals |
| Note:  Includes 2023 social and environmental financing and excludes sustainability-linked financing. | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
|  | Working with our clients |
|  |  |
|  | We want to be by our clients' side as they  transition their businesses to operate in a  low-carbon economy. We are working on  expanding our sustainable finance offering  through our specialist teams to help clients  navigate this period of extraordinary  change. |
|  |  |

Engaging clients through business and

events

We believe the transition to a low-carbon

economy is a defining opportunity for innovation

and growth – and that we can make the greatest

difference by supporting and engaging with our

clients as they transition, using our advisory and

financial expertise to help them navigate this

period of extraordinary change.

As trusted advisers we continue to proactively

engage with our clients on the risks and

opportunities for their businesses arising from

the transition to a low-carbon economy. This

includes working with climate technology

companies across their stages of development,

and with larger, established and/or higher-

intensity clients on their transition journeys.

We support clients executing their climate

strategies, including supporting the facilitation of

initial public offerings for climate-focused growth

companies, acquisitions of emerging climate

technology start-ups to diversify incumbent

clients’ business models, and financing to

mobilise the decarbonisation of operational

activities.

By way of example of the extent of our

engagement, over the course of 2023 we had

over 17,500 (2022: 15,000) engagements with

clients within the Corporate Bank on ESG topics,

thanks to focused efforts by relationship teams

to raise ESG topics proactively.

We also held numerous client events on ESG and

sustainability topics, including our inaugural

flagship Sustainable Finance Conference in New

York with an attendance of over 400 people.

Engaging clients through our Client

Transition Framework

The CTF, as outlined on page [90](#i4be61753b7f243b19551b0bfbf3a2a0d_8287), supports us to

direct our engagement efforts towards clients

that are most exposed to the risk of failing to

transition in line with the sectoral pathways

reflected in our targets.

This is informed by the outcomes of CTF

assessments, allowing us to be targeted in our

engagement efforts and provide clients with

clear communication on our expectations for

transition planning. It also helps inform our advice

on how clients best take advantage of transition

finance opportunities.

|  |  |
| --- | --- |
|  |  |
| + | Further details on our Client Transition Framework on  page [90](#i4be61753b7f243b19551b0bfbf3a2a0d_8287). |
|  |

Engaging clients through research

We provide thought leadership to support our

clients using our in-house ESG Research

capability. Clients who have access to our

research publications tell us it prompts greater

evaluation of their business needs – and we have

seen a number of instances of this leading to

broader conversations about the transition to a

low-carbon economy, the ways investors can

support the transition, and the ways Barclays is

on hand to support. In 2023 we published over

475 ESG-focused research reports.

Products and services

We support a wide range of customers and clients

– from individuals and small businesses through

our consumer and business banking services, to

mid-sized and larger businesses and institutions,

including governments, through our corporate and

investment banking services.

Barclays' position in the market, offering retail,

corporate and investment banking services,

provides us the opportunity to deliver an end-to-

end proposition – offering innovative products and

solutions to meet our clients' needs using the

power of One Barclays. Through collaboration with

our colleagues across businesses, we have built

capabilities to help support the innovation needed

to make the transition a success. For example,

through our climate-technology escalator we

provide support for scaling early-stage companies

through tailored, specialist support at each stage

of their development from idea to IPO.

This helps to ensure these companies can access

capital as they grow, for example through our

Sustainable Impact Capital mandate and network

of accelerators, our corporate bank and via the

capital markets.

During 2023, reflecting on engagement with and

feedback from our clients, we continued to build

the expertise and knowledge that clients are

looking for as they scale their businesses and

transition to a low-carbon economy. This included:

• Continuing to strengthen our dedicated teams,

capabilities and propositions supporting

businesses developing and scaling the

technologies that will help the world reduce

emissions

• Providing the finance to scale-up the

infrastructure and capacity to deliver the

renewable energy the world requires

• Enhancing our teams through specialist hires in

areas including sustainable project finance, ESG

ratings advisory and carbon trading, as well as

tailored sector training focused on

decarbonisation pathways.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 107 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

|  |
| --- |
|  |
| Barclays Leaflets 2.jpg |

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|  | Products and services offered across our client base | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |  |  |
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|  | Consumer | | | | | |  |  |  |  | Small and growth stage | | | | | | | |  |  |  |  |  | Mid-size corporates | | | | |  |  |  |  | Large corporates  and governments | | |  |  |  |  | Investors |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  | | Entrepreneur and  Innovation programmes | | | | | | |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  | Barclays is working to champion innovation and enable sustainable growth – bringing new ideas  to life is central to the way we support people, businesses, communities and the wider economy. | | | | | | | | | | | | | | | | |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  | | Barclays UK Consumer  and Business Banking | | | | | | | | | | | |  |  |  | CorporateBank_Icon.png | | | Corporate and  Investment Bank | | | | | | |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Engaging with our retail customers and businesses to develop sustainability-related  solutions that meet the needs of our customers and clients. | | | | | | | | | | | | | |  |  |  | Blending the existing expertise and relationships in our coverage groups with new, specialised teams focused  on sustainable finance growth areas – providing enhanced and integrated solutions for our clients. | | | | | | | | | | | | | | | | | |  |  |  |  |  |  |  |
|  |  | Barclays UK Consumer Sustainability Hub Engages consumers through our online  Consumer Sustainability Hub to provide information on financial products, services  and partner offers that may support them in making more sustainable choices. | | | | | | | | | | | | | |  |  |  | Energy Transition Group Provides clients with integrated strategic advice and financing solutions through  the energy value chain as they transition to a low-carbon economy. The Group supports companies in their  energy transition through the adoption and implementation of renewables, biofuels, carbon capture,  hydrogen energy, renewable natural gas, sustainable aviation fuel, batteries and solar technologies. | | | | | | | | | | | | | | | | | |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Green Home and Buy-to-let Mortgages  Mortgage offering lower interest rates for  new-build properties with an EPC rating  of A or B. | | | | | |  | Greener Home Reward  Cash reward of up to £2,000 for eligible  residential mortgage customers who  install eligible energy-efficiency-  related measures in their homes. | | | | | | |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  | Sustainable Banking Group  Provides a tailored approach to sustainability coverage, advice and execution across M&A, risk  management, equity and debt. | | | | | | | | | | | | |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  | Sustainable Project Finance Group  Provides project financing solutions for clients aiming to decarbonise their businesses, accelerate  the deployment of low-carbon technologies and monetise the associated revenue. | | | | | | | | | | | | |  |  |  |  |  |  |  |
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|  |  | Green Asset Finance  Fixed rate on range of eligible green  assets, supporting clients to transition  their business towards net zero. | | | | |  | Green Barclayloan for Business  No arrangement fees on a range of  eligible green assets, supporting clients  to transition their business towards net  zero. | | | | | | | |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
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|  |  |  |  |  |  |  |  |  |  |  | Sustainable Product Group  Provides origination and structuring of green and sustainability-linked corporate banking products  across lending, trade finance and liquidity products. | | | | | | | | | | | | |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Global Markets  Provides ESG integration across a wide range of investment solutions, spanning Quantitative  Investment Strategies (QIS), Equity or Credit Structured Solutions and Funds. | | | | | | | | | | | | |  |  |  | Green & Social Notes programme  Issuance of green notes to fund assets  efficiently. | |  |  |
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|  |  | Private Bank and  Wealth Management | | |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
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|  |  | Responsible investing and sustainable  investing solutions  ESG integration and dedicated  sustainable investment strategies.  Barclays WM&I now offers most Global  Access Funds as Article 8 products in a  bid to promote sustainability as part of  SFDR. | | | | |  |  |  |  |  |  | | Treasury Green  Programmes | |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | Managing financial sustainability and advancing climate strategy through executing principal transactions. | | | | | | | | | | | | | | | | | | | | | | |  |  |  |  |  |  |  |  |  |
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|  |  |  |  |  |  |  | Sustainable Impact Capital  Investing up to £500m into global climate  technology companies by the end of  2027, helping accelerate our clients’  transition to a low-carbon economy. | | | | | | | | |  | Green Bond Investment portfolio  Purchase of green bonds through Barclays’  liquidity pool. | | | | | | |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 108 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Entrepreneur_Picto.jpg | Entrepreneur and  innovation programmes |

Through the Group Innovation Office, Barclays

works to collaborate with innovative start-ups –

bringing new ideas to life and enabling

sustainable growth, supporting individuals,

businesses, communities, and the wider

economy. Barclays' open financial technology

(fintech) innovation strategy is focused on

sourcing ideas, technology and talent outside the

Bank and supporting its adoption and

dissemination within Barclays.

Addressing climate change and the transition to

net zero is a complex challenge. It will require

innovation to drive real-world decarbonisation.

The Group Innovation Office works to leverage

its innovation capability and wider programmes

of fintech initiatives to support the delivery of the

Barclays Climate Strategy – and to contribute to

the growth of Climate FinTech as a sub-sector of

fintech under Rise, created by Barclays. The

Group Innovation Office believes Climate

FinTech has the potential to make the transition

to a low-carbon future simpler, easier to

implement and more affordable.

|  |  |
| --- | --- |
|  |  |
| Strategic initiatives | |
| Initiative | Goal |
| Rise Start-Up  Academy | 250 founders supported by  the end of 2025 |
| Rise Growth  Academy | 50 fintechs supported by the  end of 2025 |
| Experimentation  Hub | 30 rapid vendor evaluations by  2025 |
| Eagle Labs \* | Provide up to 1,500  mentorship hours, 17 Growth  Programmes and one  Ecosystem Partnership  Programme in 2024 |
| Unreasonable  Impact | Support an additional 200  businesses solving social and  environmental challenges  from 2023-27 |

|  |  |
| --- | --- |
|  |  |
| + | Further details on Barclays' Innovation can be found at:  home.barclays/who-we-are/innovation/ |
|  |

\* Further details on Eagle Labs found on page [112](#i4be61753b7f243b19551b0bfbf3a2a0d_7746).

Barclays Rise

Rise, Barclays' global fintech platform, seeks to

create the ultimate conditions for innovation and

growth in financial services, including Climate

FinTech. Since 2015 Rise has focused on building

a global community of the best minds in fintech

to disrupt, challenge and confront the way things

are done in our industry.

|  |  |
| --- | --- |
|  |  |
|  | Spotlight: Nossa Data |
|  |  |
|  | Rise Resident and Barclays Accelerator  Alumni Nossa Data is aiming to change ESG  reporting and data management by  providing technology for non-financial  corporate disclosure. This female-founded  Climate FinTech business is collectively  supporting companies in measuring and  improving their ESG performance in order to  meet increasing regulatory requirements. |
|  |  |

Barclays Rise Start-Up Academy

The Rise Start-Up Academy helps early-stage

fintechs, supporting emerging founders with skills

and tools to help them get from proposition to

launch. The programme supports refining their

minimum viable product (MVP) through weekly

activities and live workshops. A Climate FinTech

special edition of the Rise Start-Up Academy will

launch in 2024 to support this growing category

of fintech.

Our commitment to support 250 founders by the

end of 2025, compared to our original target of

750, reflects the challenging economic and

investment climate for start-ups, and also our

intention to focus our support on companies that

are more closely aligned to Barclays’ strategic

priorities, including climate and sustainability.

Barclays Rise Growth Academy

The Rise Growth Academy helps scale high-

growth fintechs, including Climate FinTechs, and

transition their founders into CEOs with a 10-

week, digital-first curriculum with coaching,

Managing Director/Director mentorship and

access to a community. Participants may also be

considered for a potential strategic investment.

|  |  |
| --- | --- |
|  |  |
| + | Further details on Barclays Rise and its programmes can be  found at: rise.barclays/ |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 109 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  |  |  |  |
|  | Barclays Annual Report Climate FinTech advert (10x7).jpg |  | Climate FinTech  Climate FinTech is a category of fintech  supporting climate change mitigation and  adaptation, and can be used to align and  strengthen incentives across all stakeholders.  Pioneering Climate FinTech start-ups have the  potential to help make low-carbon solutions  easier to adopt for individuals and businesses.  Our 'Climate FinTech: An Innovation Thesis' will  be published to showcase the role that Climate  FinTech can play in tackling the challenges  faced by consumers, businesses and industry –  outlining the opportunity identified to support  this sector to scale. |  |
|  |  |  |  |  |

|  |  |
| --- | --- |
|  |  |
|  | Spotlight: GreenArc |
|  |  |
|  | GreenArc, a participant of the Rise Growth  Academy 2023, is an impact analytics fintech  that uses advanced AI techniques to help  financial institutions measure and maximise  the social and environmental impact of their  investments. Investors are demanding  greater accountability and transparency to  address the growing concerns over the  validity of sustainable finance, an industry  concerned with claims of greenwashing, and  thus a robust, data-driven impact  measurement system will help enable  financial institutions to credibly assess and  report the impact of their investments. |
|  |  |

Barclays Experimentation Hub

The Barclays Experimentation Hub – a business and

technology sandbox-as-a-service offering –

enables business units across the globe to rapidly

test and evaluate third-party vendor solutions,

while also providing a platform to influence industry

through collaborative events and hackathons. Since

2022 the Experimentation Hub has enabled

Barclays to explore new technologies such as

Generative AI, while also bringing together industry

experts across topics such as digital currencies –

exploring the application and business benefits of

key innovations within technology and fintech.

Experimentation has also supported Barclays

teams in keeping pace with the rapidly changing

landscape within ESG technologies and will

continue to support Barclays' Climate Goals

throughout 2024.

Unreasonable Impact

Through its Unreasonable Impact programme, a

partnership between Barclays and Unreasonable

Group which was renewed in 2023, Barclays has

supported over 300 high-growth entrepreneurs

that seek to address pressing social and

environmental challenges by connecting them

with a network of mentors and industry

specialists, including experts from across

Barclays. Through regional accelerators, at which

the entrepreneurs can engage with this network,

and other virtual and in-person events, the

Unreasonable Impact programme is designed to

help participating entrepreneurs to build

strategic relationships and quickly solve key

challenges facing their business in order to help

them scale.

After achieving its goal to support 250 ventures

by the end of 2022, Barclays will support an

additional 200 entrepreneurs over five years

through the Unreasonable Impact programme.

With billions in financing already raised by the

companies that have participated in the

programme, the partnership’s momentum

continues to grow – and the ventures are driving

innovations in a variety of industries from food

and agriculture to energy and manufacturing.

Barclays has also invested its own capital into

eight Unreasonable Impact companies through

its Sustainable Impact Capital1 mandate,

including Airex – creators of a smart air brick –

and Brill Power, which has developed battery

management technology that aims to extend

battery life and throughput.

Note:

1 Further details on Sustainable Impact Capital found on page [117](#i4be61753b7f243b19551b0bfbf3a2a0d_364).

|  |  |
| --- | --- |
|  |  |
| + | Further details on Unreasonable Impact can be found at:  home.barclays/sustainability/supporting-our-communities/  unreasonable-impact/ |
|  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Van_Loading.jpg |  |
|  | Partnering with SaveMoneyCutCarbon  SaveMoneyCutCarbon (SMCC) is an organisation focused on simplifying energy, water and  carbon reduction. It seeks to save businesses time and money and help them achieve their  sustainability goals by providing a range of services. Alongside the installation of products,  these services include providing advice and education as well as performing building audits to  help uncover savings opportunities and developing project plans to help businesses realise  these savings.  Barclays is helping companies like SMCC to scale through its Unreasonable Impact partnership  – and by investing equity capital in SMCC through the Barclays Sustainable Impact Capital  mandate. In addition, Barclays Corporate Banking clients can utilise SMCC’s services to help  them pivot their own operations to more sustainable practices. |  |
|  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 110 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Barclays UK Consumer_picto.jpg | Barclays UK Consumer  and Business Banking |

We are engaging with our retail and business

customers  to better  understand the steps they

want to take to become more sustainable – and

the role finance can play. We are using this

insight-led approach to design and develop

sustainability-related products, offers and

initiatives that meet the needs of our customers.

Throughout 2023 we have used new digital

journeys in-app and online banking to support an

additional 1.9 million customers to become

paperless and reduce their paper waste by eight

million envelopes. In 2024 we will continue our

work to encourage further adoption of paperless

banking and digitisation of communications,

further reducing paper volumes.

In 2023 we made a number of important hires to

build our sustainability leadership team in

Barclays UK. These colleagues will help drive our

client propositions and position us well to drive

the strategy in 2024. We continue to upskill and

engage colleagues on sustainability issues to

build our capability, encouraging colleagues to

integrate sustainability considerations into their

work supporting customers. This includes

tailored training for our Consumer Bank and

Business Bank colleagues, introducing our

Sustainability Champions community to bring

together our most engaged colleagues and

launching our online Colleague Sustainability Hub

to share educational sustainability-related

content.

Consumer Bank

Barclays UK Consumer Sustainability Hub

Barclays UK engages consumers through our

online Consumer Sustainability Hub, which

provides information on financial products,

services and partner offers that may support

them in making more sustainable choices. In

2023 we began adding links to the Consumer

Sustainability Hub in the Barclays app to further

support customer engagement on this topic. We

plan to create a dedicated in-app Sustainability

Hub to host educational sustainability-related

content, products and offers.

|  |  |
| --- | --- |
|  |  |
| + | Further details on the consumer-facing Sustainability Hub  can be found at:  barclays.co.uk/sustainability/ |
|  |

Greener home propositions

Barclays UK is supporting retail mortgage

customers' transition to a more sustainable way

of living, providing products and propositions

focused on retrofitting. In 2023 we rolled out

training on home energy efficiency and climate

risk to our mortgage advisors, and hosted a

webinar for mortgage brokers with retrofitting

industry experts.

In collaboration with British Gas, we launched an

offer of 50% off the purchase of a Hive

Thermostat Mini for eligible residential mortgage

customers.

|  |  |
| --- | --- |
|  |  |
| + | Further details on Barclays Hive Thermostat Mini offer can  be found at: barclays.co.uk/sustainability/greener-homes/  hive-thermostat-mini/terms-and-conditions/ |
|  |

We continue to support customers purchasing

EPC A- and B-rated new-build homes with our

Green Home Mortgage, following its expansion

to include buy-to-let properties in 2022. In 2023

we lent £845m to Green Home Mortgage

customers. Since inception in 2018, Barclays UK

has lent over £3.5bn to Green Home Mortgage

customers.

|  |
| --- |
|  |
| Green Home Mortgage completions |

Number of completions

![1272]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| n | 2023 progress | n | Total since 2018 |

Value of completions (£m)

![1302]()

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| n | 2023 progress | n | Total since 2018 |

|  |  |
| --- | --- |
|  |  |
| + | Further details on Barclays Green Home Mortgages can be  found at: barclays.co.uk/mortgages/green-home-mortgage/  Further details on Barclays Green Buy-To-Let Mortgages  can be found at: barclays.co.uk/mortgages/green-buy-to-let-  mortgage/ |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 111 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  |  |  |  |
|  | British Gas.jpg |  | Exploring home energy efficiency with British Gas  In partnership with British Gas, we ran an energy efficiency exhibition in the  Plymouth city centre branch to help local customers explore ways they could make  their homes more energy efficient. The ‘Exploring Home Energy Efficiency  Exhibition’ ran for six weeks between October 2023 and December 2023,  showcasing some of the technology that could help customers improve the energy  efficiency of their home and potentially help lower their bills. Each week focused on  a different energy efficiency theme, including low-carbon technology, retrofitting  and the financial support available to households. Customers were able to learn and  engage through weekly interactive sessions and Q&A panels made up of speakers  from British Gas, Barclays and others. To coincide with National Green Careers  Week in November, Plymouth City Council ran a series of carbon literacy events for  career changers, job seekers and schools in the branch – and customers had the  opportunity to take part in a ‘green careers fair’ to understand what a net zero  career could look like for them. |  |
|  |  |  |  |  |

Barclays UK Greener Home Reward

In 2023 we extended registrations for the

Greener Home Reward scheme, which offers a

cash reward of up to £2,000 for eligible

residential mortgage customers who install

eligible energy-efficiency-related measures in

their homes using a registered TrustMark

installer. We have seen continuing interest in

microgeneration, with 45% of applications so far

for solar panels and solar battery storage.

However, demand for the offer remains limited.

This exemplifies the challenges the sector faces

to increase the take up of retrofitting.

|  |
| --- |
|  |
| Retrofit types at registration |

|  |
| --- |
|  |
| Solar energy |
| Doors and windows |
| Low-carbon  heating |
| Insulation |
| Solid wall insulation |

![164926744191015]()

|  |  |
| --- | --- |
|  |  |
| n | Solar energy |
| n | Doors and windows |
| n | Low-carbon heating |

|  |  |
| --- | --- |
|  |  |
| n | Insulation |
| n | Solid wall insulation |
|  |  |

|  |  |
| --- | --- |
|  |  |
| + | Further details on Barclays Greener Home Reward can be  found at:  barclays.co.uk/mortgages/greener-home-reward/ |
|  |

Barclays UK is also committed to working

collaboratively with the UK Government to

encourage and inform the development of

strategies and policies to drive more energy-

efficient homes and retrofitting – including

through industry groups where appropriate, and

through our own engagement with policymakers.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Customer retrofitting research  and parliamentary roundtable |  |
|  |  |  |
|  | image.png |  |
|  |  |  |
|  | Retrofitting homes with the aim of reducing  carbon emissions in line with UK net zero  targets is a challenge Barclays believes  requires a collaborative response. In  September 2023 we convened a roundtable  in Parliament with representatives from UK  Government, consumer groups, industry  and academia to discuss a Barclays-  commissioned report from Ipsos UK on  consumer retrofitting behaviour. The report  identified potential barriers to action among  ‘able to pay’ homeowners who could  potentially undertake retrofitting to increase  the energy efficiency of their property. The  report made a series of recommendations  to improve uptake of retrofitting due to  limited levels of this activity currently. There  was agreement among roundtable  representatives that there is a significant  awareness gap that could be addressed by  promoting the benefits of retrofitting and  improving access to practical guidance.  However, there were a range of views on  how to share the burden of responsibility for  these actions – with a number of attendees,  including Barclays, underlining the important  role for bolder UK Government leadership  and policy to drive behaviour change. |  |
|  |  |  |

Business Bank

Barclays continues to support Business Bank

clients to understand the case for sustainability,

recognising that clients are at varying stages of

their transition to net zero.

Embedding sustainability across the

Business Bank

We continue to build our net zero expertise to

give eligible businesses that bank with us the

chance to explore the options available to them

as part of transition plans towards net zero. In

2023 we provided sustainability training for

Business Bank colleagues, including Real Estate,

Agriculture and Specialist Client Solutions teams.

For clients that prefer to self-serve, we created a

series of educational videos to raise awareness

of themes relating to the transition to a low-

carbon economy.

In 2023 we launched an EPC dashboard to enable

Real Estate Relationship Managers to provide a

view of EPC ratings across a clients’ portfolio with

Barclays UK – and use it to discuss potential

benefits around EPC improvements.

In July 2023 we expanded our existing Asset

Finance proposition via our partner Propel to

offer fixed rates on a wider range of green assets

including new fully electric vehicles, solar

photovoltaic panels, battery storage units, LED

lighting, heat pumps and electric vehicle charging

points. In September 2023 we launched our

Green Barclayloan for Business, which offers no

arrangement fees for lending above £25,000 on a

range of eligible green assets – supporting our

business clients in their transition to net zero.

External  engagement

In 2023 we joined the Broadway Initiative and sit

on the advisory board for the UK Business

Climate Hub, which will help facilitate net zero

support for our clients.

To recognise the positive impact of ESG-

focused entrepreneurs on the wider economy,

the ‘Sustainability Award’ category for the

Barclays Entrepreneur Awards was awarded for

the second time in 2023 – attracting over 100

applications.

Barclays Eagle Labs

Barclays Eagle Labs look to help incubate, inspire

and educate UK founders, start-ups and scale-

ups and help them to succeed and grow. Its

growing network already supports businesses

through 37 physical sites, as well as virtually

across the UK.

|  |
| --- |
|  |
| 13,812¹  Total businesses supported by  Eagle Labs through propositions,  programmes, and businesses engaged  with the ecosystem since 2015 |

|  |  |
| --- | --- |
|  |  |
| + | Further details on Barclays Eagle Labs can be found at:  labs.uk.barclays |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 112 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

Eagle Labs climate tech

Eagle Labs is building a community of climate

tech startups working on disruptive technology

to deliver a more sustainable future.

In October 2023 the Cambridge Eagle Lab was

relaunched as a centre for climate tech start-ups

and scale-ups. The lab has been retrofitted to

improve energy efficiency in line with Barclays'

net zero ambition – including hybrid solar

technology generating both electricity and heat

provided by Naked Energy, a company supported

through our Unreasonable Impact programme

and Barclays’ Sustainable Impact Capital.

|  |  |
| --- | --- |
|  |  |
| + | Further details on our Unreasonable Impact programme can  be found here home.barclays/sustainability/supporting-our-  communities/unreasonable-impact/  Further details on our Sustainable Impact Capital  programme  can be found here home.barclays/sustainability/  addressing-climate-change/financing-the-transition/  sustainable-impact-capital/ |
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Digital Growth Grant

In 2022 Barclays Eagle Labs was awarded a c.

£12m Digital Growth Grant by the UK

Government, to support technology businesses

across the UK. Over a two-year period,

commencing from April 2023, the grant will

amplify Barclays Eagle Labs' overall ambition to

support the growth of up to 22,000 UK tech start-

ups and scale-ups. Since April’s launch, Barclays

Eagle Labs have opened applications for 12

dedicated growth programmes – including the

Black Venture Growth Programme, the Female

Founder Accelerator and the Sustainability Bridge.

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| 849²  Total businesses supported through  Digital Growth Grant Programmes as  of December 2023 |

Notes

1 Covering all businesses supported by Eagle Labs through

propositions, programmes, and ESE since 2015 (as of December

2023).

2 Sum of cohort sizes of the programme that have closed for

applications (as of December 2023).

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|  | Eagle Labs.jpg |  | Carbon13 Venture Launchpad  in partnership with Barclays  Eagle Labs  Carbon13 is a Cambridge-based, globally focused  venture builder. Eagle Labs have partnered with  Carbon13 to develop a Venture Launchpad to  help pre-seed and early-stage businesses launch  high-potential and global-impact climate tech  ventures. The first Carbon13 Venture Launchpad  programme brought together 22 companies  focused on innovation in the built environment.  From April 2023 to October 2023, founders were  supported to help set each of their businesses on  a trajectory to mitigate 10 million tonnes of CO2e  at scale. Seven programme participants each  received funding of £120,000 from Carbon13 –  including digital twins for building performance  optimisation and new systems for transporting  chilled goods. |  |
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|  | Advancing Net Zero in the built  environment with  Sustainability Bridge  Through our Sustainability Bridge programme,  we are bringing together 29 startups and nine  corporates to support the transition to net  zero in the built environment – with a specific  focus on retrofit and energy efficiency.  Corporates on the programme range from  national energy companies to social housing  providers. Start-ups in the cohort are driving  cutting edge innovation, ranging from drone  thermal imaging as an EPC alternative to  climate data aggregators and companies who  believe the buildings of the future will be grown,  not built. The programme is being delivered by  CodeBase, in partnership with Barclays Eagle  Labs, and is funded by the UK Government  through the Digital Growth Grant. |  | Sustainability Bridge.jpg |  |
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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 113 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

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| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

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|  | Corporate_Invest.Bank_Picto.jpg | Corporate and  Investment Bank |

How we serve our clients

We continue to evolve our model to support our

clients and capture the opportunities as they

transition to a low-carbon economy.

Following the appointment of the Global Head of

Sustainable Finance in November 2022, in early

2023 we established the CIB Sustainable Finance

Management Team (CIB SF MT) with

responsibility for driving the sustainable finance

strategy in the CIB. The CIB SF MT acts as a

consolidation point for the discussion and

decision-making of key matters relating to the

strategic direction of the CIB sustainable finance

business, reviews financial performance and

ensures a robust approach to climate risk

management and controls.

At Barclays we use the concept of the Power of

One Barclays, which brings our organisation

closer together to create synergies and provide

customers and clients with the full range of our

products and services. We have applied this

mindset to consider how we can best serve our

clients' needs relating to Sustainable and

Transition Financing through an integrated

approach across Barclays' products and services.

This has included the strengthening of our

sustainable finance teams, working together to

deliver for our clients and embedding

sustainability across our sector and industry

coverage teams.

Strengthening our sustainable finance teams

Through the continued investment in our team

we are able to deliver a fuller suite of products,

solutions and expertise to clients as they

transition towards a low-carbon economy.

During 2023 we invested significantly in our

sustainable finance capabilities through key

senior and specialist hires which have

strengthened our existing teams and expanded

our sustainable finance product offering. This

included hiring new Heads of Sustainable Project

Finance and Carbon & Environmental Products

Trading, facilitating the expansion of our product

reach into these areas in recognition of client

demand and the commercial opportunity.

We have also continued to strengthen our existing

sustainable finance teams with the hiring of senior

specialists including across ESG ratings advisory,

AgriTech and battery technologies, and regionally

focused sustainable finance specialists covering

the Middle East, North Africa and Asia Pacific.

Following growth in the team over the past few

years, at the end of 2023 we had in excess of 90

sustainable finance-focused bankers in the CIB,

supported by ongoing investment in expertise in

our sustainable finance and ESG-focused

functional teams.

Working together to deliver for our clients

We continue to facilitate collaboration across CIB

teams in order to work more closely together on

sustainable finance topics and solutions. In 2023

we created a Sustainable Finance Leadership

Group bringing together key 'champions' of

sustainable finance from across the CIB with a

view to creating more frequent and deeper

exchanges of ideas – which will help strengthen

our dialogue with clients and drive better

outcomes for them.

We believe that the strength of our franchise is

truly unlocked when we work closely together

across our teams. Examples of this included

collaborations between our ESG advisory,

industry coverage and Sustainable Impact

Banking teams on M&A opportunities, as well as

our industry teams bringing technical experts

into client meetings to discuss

decarbonisation options.

![Sustainable Finance ecosystems.jpg]()

Over the past year we continued to evaluate how

sectors and companies are best covered by the

Bank, and have adapted our model accordingly to

provide the support and resources required by

our clients. In January 2024 we announced the

creation of our new Energy Transition Group –

bringing together our Power, Energy and

Sustainable Impact Banking (SIB) teams so we

can better serve as lead advisers to clients in the

Energy and Power sectors exploring potential

energy transition opportunities.

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We also announced the creation of our new

Sustainable Banking Group within Capital

Markets, combining our Sustainable Capital

Markets and ESG Advisory team (previously part

of the SIB team).

Embedding sustainability in our business

Over the course of 2023 we continued to embed

sustainability across our sector and industry

coverage teams through a number of important

initiatives to upskill our bankers and develop their

expertise to engage with clients on the transition.

We ran our first sector-level client activation

programmes – focused on the Building Materials

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 114 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

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| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

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| CIB Sustainable Finance ecosystem |

and Power and Utility sectors – accelerating the

ability of our bankers to identify and capture

sustainable finance opportunities by helping

them focus on key decarbonisation levers in

these sectors and how to deploy Barclays'

products and services to help clients

unlock them.

We recognise the importance of continued

training and upskilling of our workforce,

particularly in the rapidly developing climate

technologies of the future, and ran a series of

seminars and workshops throughout the year

covering these key topics. In the second half of

2023 we also developed a detailed sustainable

finance training plan for colleagues across the

CIB, which we will roll-out in 2024.

During 2023 we continued to develop our

management information as it relates to our

sustainable finance business, including

appropriate KPIs and sustainable finance metrics

on our bankers' scorecards, which are tracked

monthly – increasing the visibility of our

performance. We will continue to evolve our

approach in this area in 2024.

As we see further growth in sustainable finance

and the ESG market space the focus on controls

remains imperative to enable our business to

operate in a precise and scalable way. Dedicated

ESG review and control fora are being stood up

at the CIB and individual business level to provide

oversight of greenwashing risks in the context of

financing of clients in high emitting sectors. In

addition, we have continued to strengthen our

approach to climate risk governance within the

CIB and review climate risk, financed emissions

and transition finance metrics at appropriate fora

and committees to provide financial and

operational risk oversight.

Energy Transition Group

The newly formed Energy Transition Group

provides clients with integrated strategic advice

and financing solutions through the energy value

chain as they transition to a lower-carbon future.

The Energy Transition Group comprises

specialist bankers drawn from the Bank's

previous global Natural Resources and Power

sector teams and Sustainable and Impact

Investment Banking team. It aims to be a centre

of excellence providing a broad spectrum of

expertise regarding the energy transition –

including hydrogen, energy transition finance,

carbon capture, renewables and renewable

natural gas.

Sustainable Banking Group

The newly formed Sustainable Banking Group

supports the sustainability needs of our clients

across all industries through a tailored approach

to coverage, advice and execution across M&A,

risk management, equity and debt.

The team will focus on covering the range of

sponsors and investors with dedicated

sustainability capital, advising clients on

sustainability matters and offering a broad range

of sustainable capital markets products –

originating, structuring and executing

sustainable-finance-labelled instruments

including green, social, sustainable, transition and

sustainability-linked solutions and vehicles.

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|  | BAR_NVI_S_NZ_232.jpg |  |
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|  | Federal Republic of Germany: Green Bonds  Barclays acted as Joint Lead Manager on the Federal Republic of Germany’s €5.25bn 10Y Green  Bond in April 2023, and €4.5bn 30Y Green Bond in June 2023. These transactions are intended to  support the country’s transition towards a low-carbon, resource-efficient and sustainable  economy. The funds raised from the bonds will be allocated towards eligible green expenditures  including all areas of the federal budget that support the overall climate and sustainability targets  set out in the Federal Republic of Germany’s Green Bond Framework. Furthermore, the eligible  expenditures are mapped to the six environmental objectives of the EU taxonomy for  environmentally sustainable economic activities. Barclays is pleased to support the German  government in continuing its strategy of establishing a green yield curve for the euro area. |  |
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Sustainable Project Finance

In 2023 we established our Global Sustainable

Project Finance team. The team provides project

financing solutions for clients aiming to

decarbonise their business, accelerate the

development of low-carbon technologies and

monetise the associated revenue opportunities.

The team builds on our existing experience and

expertise in project finance to offer integrated

and innovative solutions for clients including tax

equity, global debt arrangement and structuring,

alongside strategic M&A, rates and capital

markets expertise.

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Sustainable Product Group

The Sustainable Product Group delivers a broad

range of green and sustainability-linked

corporate banking products. The Sustainable

Product Group’s offering includes green and

sustainability-linked trade, corporate

lending, fund-financing products and deposit

solutions.

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 115 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

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| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

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|  | Ohmium International |  |
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|  | Ohmium.jpg |  |
|  | In April 2023, Ohmium International, a leading  green hydrogen company that designs,  manufactures and deploys advanced proton  exchange membrane electrolyzer systems  using renewable energy to produce  pressurised high-purity green hydrogen,  partnered with teams across Barclays’  Corporate and Investment Bank to help  successfully close a $250m Series C growth  equity financing round. Barclays served as  Placement Agent to Ohmium on the capital  raise. The funding will be used to support  Ohmium’s expansion to 2GW in annual  manufacturing capacity and the deployment  of projects for the company’s growing global  customer pipeline in key regions. The  investment will also provide significant capital  to scale Ohmium’s business, including  accelerating its pioneering research and  development programmes to reduce the  cost of green hydrogen production. At that  time, this transaction was the fifth hydrogen  deal in 13 months for Barclays’ Sustainable  and Impact Banking Group, now known as  the Energy Transition Group, highlighting our  deep sector knowledge across the entire  hydrogen technology value chain and  ecosystem. |  |
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Global Markets

Our Global Markets team provides ESG

integration across a wide range of investment

solutions spanning Quantitative Investment

Strategies, Equity or Credit Structured Solutions

and Funds. This includes our  Green & Social

Notes programme  issuance of green notes

against eligible assets, earmarked in line with our

Green & Social Notes Framework. Global Markets

also provides financing solutions such as clean

tech securitisation and can embed sustainability-

linked features into hedging solutions. Our Global

Markets team also provides market access to

ESG products and a range of Prime Services –

including clearing carbon and ESG futures.

During 2023, Barclays continued to grow its

financing business backed by assets that match

its Sustainable Finance Framework and support

the long-term green, transition and broader

sustainable financing requirements of our clients,

with a focus on securitised products in residential

and solar, heat pumps and electric vehicles.

Looking forward into 2024 we expect to expand

into other sustainable and energy-efficient

technologies and opportunities.

Barclays also grew its footprint in originating and

distributing social and sustainability-linked loans,

as well as structured financing with sustainable

use of proceeds instruments

Green & Social Notes programme

The Barclays Bank PLC Green & Social Notes

Programme covers Barclays-issued products in

the Equities and Rates space, leveraging use-of-

proceeds assets including renewable energy,

low-carbon transport and energy-efficient real

estate, in line with the requirements set out in

our Green & Social Notes Framework. All green

assets in the pool are verified by a third party and

aligned to industry standards.

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| + | Further details on our green notes programme can be found  at:  home.barclays/greenbonds/ |
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ESG across our research teams

Our approach to ESG research is differentiated

through broad-based engagement with ESG

issues and higher-quality insights with our

investor clients. The ESG Research team

collaborates with Equity and FICC research

teams to identify and analyse material ESG

opportunities and risks, and to integrate ESG into

their analysis and recommendations. The team

also analyses how investors measure and

consider ESG factors in the investment process,

helping asset managers structure their portfolios

and investment decisions.

Over 475 ESG-focused research reports were

published in 2023. Our expectation is that topics

such as climate change, decarbonisation and

biodiversity – as well as other sustainability

themes and specific ESG attributes – will

continue to grow in importance, and that the

global momentum behind ESG investing will

continue at pace, making it an essential requisite

for a large and growing number of investors.

During 2023 ESG Research hosted and

contributed content to client events around the

world – including Barclays' first Sustainable

Finance Conference in New York, its fourth

annual ESG Research conference in London, its

first Sustainable Finance Conference in

Singapore, its Sustainable Policy Forum in

Brussels and its ESG Emerging Market

Corporate Day.

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| + | Further details on ESG Research can be found at:  cib.barclays/research |
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Sustainable and Thematic Investing

The Sustainable and Thematic Investing

Research team at Barclays focuses on

sustainability and long-term thematic disruption.

Its reports are produced in conjunction with

sector analysts, with the aim of identifying multi-

year sector trends that could help shape the

future business environment. Typically the team

identify topics with a five- to 10-year horizon,

with investment opportunities spanning both

public and private companies.

To aid thematic and ESG investors, the team

maintains an investment framework known as

the ‘2030 Thematic Roadmap: 150 Trends’ – and

has published reports on various trends relating

to disruptive technology, sustainability and

demographic change. The team has also

developed a range of investment tools including

trend momentum scores, UN SDG mapping and

company revenue tagging.

Relevant 2023 publications include Advance

Chemical Recycling, Grid Infrastructure, Digital

Safety, Vehicle Grid Integration, Cultured Meat,

Gender & Social Inclusion, Human Capital and

VC Trends.

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| + | Further details on the Sustainable and Thematic  Investing Research team can be found at:   cib.barclays/  our-insights |
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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 116 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

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| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

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|  |  | Sustainable Impact Capital programme  by Barclays Principal Investments |

Barclays' Treasury plays a key role in helping

Barclays meet its climate goals by allocating,

managing and governing its financial resources

effectively and executing sustainable principal

investments and transactions, supporting

businesses to advance strategic climate

objectives in the transition towards a low-

carbon economy.

Sustainable Impact Capital

Our Sustainable Impact Capital portfolio,

managed by the Barclays Principal Investments

team in Treasury, has a mandate to invest up to

£500m into global climate technology companies

by the end of 2027 – helping support our clients’

transition towards a low-carbon economy.

![Sustainable Impact Capital graphic_p118.png]()

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| + | Further examples of our green innovation financing can be  found at:  [home.barclays/sustainability/our-position-on-](home.barclays/sustainability/addressing-climate-change/financing-the-transition/sustainable-impact-capital/)  [climate-change/accelerating-the-transition/sustainable-](home.barclays/sustainability/addressing-climate-change/financing-the-transition/sustainable-impact-capital/)  [impact-capital/](home.barclays/sustainability/addressing-climate-change/financing-the-transition/sustainable-impact-capital/) |
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We aim to drive change by strategically investing

in visionary early-stage climate tech companies

paving the way for solutions in clean energy and a

reduction in GHG emissions. The Sustainable

Impact Capital portfolio targets investments that

could potentially catalyse transformative

breakthroughs in technology, infrastructure and

scalable practices.

Our aim is to bridge financing gaps and support

the acceleration and scalability of solutions to

environmental challenges.

We have made meaningful progress towards

building a portfolio of strategic investments.

£138m of our £500m investment mandate has

been deployed since 2020, with £49m invested in

2023 – up 42% from 2022.

We continue to focus on decarbonisation

technologies supporting transition within

carbon-intensive sectors, particularly where

Barclays has meaningful client exposure – such

as Power, Industry, Transport, Agriculture and

Real Estate – including solutions delivering

carbon capture, carbon dioxide removal and

green hydrogen.

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| + | Further examples of our entrepreneur and innovation  programmes can be found on  page  [109](#i4be61753b7f243b19551b0bfbf3a2a0d_346). |
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| Achieved to date |

£138m

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| Our portfolio of investments since 2020  £m |

![1789]()

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| n | 2020 | n | 2021 | n | 2022 | n | 2023 | n | Mandate by end  of 2027 |

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|  | GeoPura-HPU.jpg |  |
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|  | GeoPura  The investment in GeoPura, a producer of Hydrogen Power Units (HPUs), demonstrates our  support for innovative technologies that enhance the energy transition. Established to make an  impact in decarbonising global industries using zero-emission fuels, GeoPura has grown rapidly  since delivering its first HPU. Its technology and end-to-end service is a multi-purpose  replacement for diesel power worldwide.  GeoPura generates hydrogen and transports the fuel to customers for use in its HPUs.  The company is targeting sectors with the highest diesel use today – including construction,  infrastructure, outdoor events, and back-up power for hospitals, data centres and critical  infrastructure. It is also providing a solution for commercial EV charging where the local  electricity network is not capable. Headquartered in Nottingham, with manufacturing capability  in Newcastle upon Tyne, the investment is enabling mass manufacturing of HPUs – increasing  the production of green hydrogen to fuel the units and driving green skills in the North East,  while supporting the technology's global deployment. |  |
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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 117 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

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| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

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|  | + | Further details can be found at: [home.barclays/news/press-releases/2023/02/](https://home.barclays/news/press-releases/2023/02/Giants-of-industry-manufacturing-finance-back-UK-green-hydrogen-pioneer-GeoPura-with-36m-investment/)  [Giants-of-industry-manufacturing-finance-back-UK-green-hydrogen-pioneer-](https://home.barclays/news/press-releases/2023/02/Giants-of-industry-manufacturing-finance-back-UK-green-hydrogen-pioneer-GeoPura-with-36m-investment/)  [GeoPura-with-36m-investment/](https://home.barclays/news/press-releases/2023/02/Giants-of-industry-manufacturing-finance-back-UK-green-hydrogen-pioneer-GeoPura-with-36m-investment/) |
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|  | Advanced Electric Machines  Barclays’ Sustainable Impact Capital investment in Advanced Electric Machines (AEM) – a UK-  based sustainable motors and powertrain systems developer and manufacturer – signifies its  support for innovative automotive technology. With the global transition to EVs there is growing  demand for key raw materials – especially rare-earth minerals for use in magnets essential for  EV motor production. However, the limited global production capacity of these materials poses  a significant challenge.  AEM’s next-generation electric motors and powertrain systems are designed without rare-  earth magnets and copper windings, while focused on performance, range and efficiency. This  breakthrough not only ensures a sustainable supply chain but also enhances recyclability –  contributing to a circular economy.  In an era where sustainable mobility solutions are crucial, Barclays’ investment in AEM  represents a significant step towards unlocking electric mobility’s potential while addressing  critical raw material challenges. |  |
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|  | Sustainable Ventures  Barclays' Sustainable Impact Capital led Sustainable Ventures' first-ever fundraising round, with  participation from angel investors. Sustainable Ventures is an active climate tech ecosystem in  the UK. Its model combines funding, workspaces and expert support services – providing access  to a pipeline of leading climate tech investment opportunities. Sustainable Ventures’ winning  concept has supported over 500 climate tech companies to rapidly scale their technologies,  drive increased returns, and directly create more than 5,500 jobs. Barclays understands that  scaling climate technology companies require much more than venture capital. The investment  in Sustainable Ventures affirms our commitment through providing access to the bespoke  support programmes, professional services, and community these companies need and  deserve – all designed to accelerate sustainable growth. Our investment will enable Sustainable  Ventures’ regional expansion, starting with Manchester in 2024 – assisting the region in meeting  its accelerated 2038 net zero target while delivering inclusive green jobs and boosting the  economy. |  |
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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 118 |
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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

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| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

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| --- | --- | --- |
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|  | + | Further details can be found at: [home.barclays/](https://home.barclays/news/2023/10/sic-advanced-electric-machines/)  [news/2023/10/sic-advanced-electric-machines/](https://home.barclays/news/2023/10/sic-advanced-electric-machines/) |
|  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | + | Further details can be found at: [barclays/news/2023/10/barclays-invests-in-sustainable-](https://home.barclays/news/2023/10/barclays-invests-in-sustainable-ventures-to-help-drive-uk-expans/)  [ventures-to-help-drive-uk-expans/](https://home.barclays/news/2023/10/barclays-invests-in-sustainable-ventures-to-help-drive-uk-expans/) |
|  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  | Treasury green  programmes |

Green bond investment portfolio

Treasury invests in green bonds as part of the

liquidity pool. As an investor we undertake work

to ascertain the ESG credentials of proposed

investments. We engage with green, social and

sustainability bond issuers to understand how

their frameworks and goals align with our

investment approach. The proceeds of our green

bond investments fund projects in areas such as

renewable energy and clean transport. We

continue to consider investments in new

supranational organisations and government-

issued bonds as they become available, with the

aim to invest £4bn over time.

|  |
| --- |
|  |
| Green bond investment portfolio  size by year  £bn |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![668]()

|  |
| --- |
|  |
| Green bond investment portfolio impact by  sector (%) |

![737]()

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| n | Renewable Energy and  Energy Efficiency | 30 |  | n | Water and Waste | 4 |
|  |  |  | n | Agriculture, Land Use | 5 |
| n | Transport | 45 |  |
| n | Other | 17 |  |  |  |  |

|  |
| --- |
|  |
| Green bond investment portfolio impact  by region (%) |

![42880953498312]()

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| n | Europe | 73 |  | n | Africa | 11 |
| n | Asia | 7 |  | n | North America | 3 |
| n | South America | 7 |  |  |  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Private bank_Picto.jpg | Private Bank and Wealth Management |

Responsible investing

Private Bank

In our Private Bank, responsible investing means

integrating material ESG considerations – among

others – into our investment decisions, and

fulfilling our stewardship responsibilities through

engagement and voting. This is an integral

element in meeting our fiduciary duties towards

our clients. Our Discretionary Portfolio

Management (DPM) services are offered across

the Private Bank and sit at the core of its long-

term strategy. Our DPM Traditional strategies

include the Global Multi-Asset Class Strategy,

Equity strategies and Fixed Income strategies.

Our DPM Sustainable strategies are the Multi-

Asset Class Sustainable Total Return Strategy

and the Sustainable Global Equity Strategy.

While we incorporate the same approach in each

of our discretionary strategies and in all

jurisdictions1 in which we operate, we may have

portfolios with specific requirements where we

need to vary our approach to our core strategies.

For our Traditional strategies we maintain a

standard set of exclusions that do not allow us to

invest in businesses we view as being involved in

the manufacture of controversial weapons, and

we consider material ESG risks as part of the

standard investment process.

Our Sustainable strategies seek to invest in

businesses that provide products and services to

support the transition to a more sustainable

economy. These identify businesses we believe

are able to mitigate ESG risks from an

investment perspective, demonstrate high

standards of non-financial ESG quality, and

address sustainability considerations through

their economic activities by aligning to at least

one of the UN SDGs. Our Sustainable strategies

also exclude certain companies that generate

revenues over our internally defined thresholds

from adult entertainment, alcohol, armaments,

gambling, fossil fuels, tobacco and controversial

weapons.

All our DPM strategies seek to deliver

competitive investment returns for our clients

and create long-term value for stakeholders.

We believe responsible investing helps us

achieve this.

|  |  |
| --- | --- |
|  |  |
| + | Further details on the Private Bank's approach to responsible  investing can be found at:  [privatebank.barclays.com/what-we-](https://privatebank.barclays.com/what-we-offer/investments/responsible-investing-engagement-and-voting-activities/)  [offer/investments/responsible-investing-engagement-and-](https://privatebank.barclays.com/what-we-offer/investments/responsible-investing-engagement-and-voting-activities/)  [voting-activities](https://privatebank.barclays.com/what-we-offer/investments/responsible-investing-engagement-and-voting-activities/) |
|  |

Barclays Investment Solutions Limited (BISL)

Just as in the Private Bank, responsible investing

for BISL means integrating material ESG

considerations – among others – into our

investment decisions, and fulfilling our

stewardship responsibilities through

engagement and voting. This is an integral

element in meeting our fiduciary duties towards

our clients. Our main ESG offering is the Multi-

Asset Sustainable Fund. We also have a range of

single-asset-class funds classified as Article 8

under the EU’s Sustainable Finance Disclosure

Regulation, which exclude certain companies

that generate revenues over our internally

defined thresholds from adult entertainment,

alcohol, armaments, gambling, fossil fuels,

tobacco and controversial weapons.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 119 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

BISL factors responsible investing into its

discretionary portfolio and fund investment

solutions. The vast majority of our clients’ assets

are managed by external fund managers. We aim

to assess each of those managers based on their

ESG credentials among other relevant factors.

Every manager’s offering is given a single

standalone score from A to C for ESG

considerations – reflecting both their intent and

their outcome. We focus on how ESG is

embedded across each of five key areas: the

parent company; the people managing the

assets; the investment philosophy employed; the

robustness of the process; and the performance

achieved. Ultimately, we award an ESG score for

every fund we recommend or invest in. The team

uses data from different sources, including

investment managers and MSCI ESG Manager,

and as such there may be some limitations in the

data we use.

|  |  |
| --- | --- |
|  |  |
| + | Further details on BISL's approach to responsible investing  can be found at:  barclays.co.uk/wealth-management/  important-information/responsible-investing-statement |
|  |

Industry initiatives

Private Bank

Barclays Private Bank Investment Management

became a signatory of the Principles for

Responsible Investment (PRI) in 2022,

completing its first reporting to the PRI on

responsible investing activities in 2023.

Being a signatory to the PRI allows us to publicly

demonstrate our commitment to responsible

investment. The PRI defines responsible

investment as a strategy and practice to

incorporate ESG factors in investment decisions

and active ownership. Its goal is to help

contribute to the creation of a sustainable

financial system, with signatories committing to

incorporate ESG issues via the six Principles in

their investment practice.

Barclays Investment Solutions Limited

BISL became a signatory to the PRI in 2023. Prior

to this, and since 2016, BISL’s subsidiary Barclays

Asset Management Limited was a signatory. BISL

also became a signatory to the UK Stewardship

Code in 2023, which sets high stewardship

standards for those investing money on behalf of

UK savers and pensioners and those that

support them. Stewardship is the responsible

allocation, management and oversight of capital

to create long-term value for clients and

beneficiaries with the aim of achieving

sustainable benefits for the economy, the

environment and society.

Engagement and voting

Private Bank and Barclays Investment Solutions

Limited (BISL)

Both the Private Bank and BISL undertake

engagement and voting in partnership with our

stewardship services provider, EOS at Federated

Hermes (EOS), in respect of certain holdings

relating to specific services2. We view

engagement and voting as an important

mechanism through which to hold management

to account and act as a lever to promote change

in investee companies on material ESG issues

where appropriate. We believe companies that

can better manage material ESG issues could be

less prone to severe incidents such as fraud,

litigation or reputational risks.

Voting forms an integral part of the Private Bank

and BISL's overall stewardship strategy and is

used as a tactical tool to achieve desired changes

on ESG issues. Based on various metrics, BISL

filters EOS's voting recommendations in relation

to company holdings and, if deemed necessary,

our portfolio managers may deviate from EOS's

recommendation.

At Private Bank, for our direct equity holdings, we

use our rights as shareholders to seek and drive

our desired changes. Following receipt of EOS’s

voting recommendations, our Equity portfolio

managers meet to discuss this information for a

select number of voting issues in advance of

making the voting decision on behalf of our

clients. Our Equity portfolio managers are

ultimately responsible for making voting

decisions.

All voting activities sit alongside engagement

practices, reflecting both the Private Bank and

BISL approach of promoting constructive

dialogue with investee companies by building

long-term relationships to seek to influence ESG

and other practices. This is mostly undertaken by

EOS, which engages on behalf of clients including

Barclays with a wide range of stakeholders –

including government authorities, trade bodies,

unions, investors and NGOs – to seek to identify

and respond to market-wide and systemic risks.

Both the Private Bank and BISL make their

engagement and voting activities publicly

available to all stakeholders on the Barclays

website. We believe such transparency is an

integral part of good governance.

|  |  |
| --- | --- |
|  |  |
| + | Further details on engagement and voting can be found at:  Private Bank: [privatebank.barclays.com/what-we-offer/](https://privatebank.barclays.com/what-we-offer/investments/responsible-investing-engagement-and-voting-activities/)  [investments/responsible-investing-engagement-and-voting-](https://privatebank.barclays.com/what-we-offer/investments/responsible-investing-engagement-and-voting-activities/)  [activities](https://privatebank.barclays.com/what-we-offer/investments/responsible-investing-engagement-and-voting-activities/)  BISL: barclays.co.uk/wealth-management/important-  information/responsible-investing-statement |
|  |

Responsible Lending

Private Bank

We have launched our Greener Mortgage

Discount3 for UK properties, offering a reduced

arrangement fee for new-build properties with an

EPC rating of A-B – incentivising clients to seek

energy-efficient properties and to encourage

homebuilders to achieve maximum energy

efficiency from their projects. Clients will also be

supported in improving the energy efficiency of

their existing properties – we have publications

available to encourage clients to consider

sustainably retrofitting their homes to improve

energy efficiency, and intend to enhance this

throughout 2024. This falls into the wider work

we have undertaken on creating educational

content and guidance4 for clients in relation to

ESG in the Real Estate space and beyond. For our

wider credit offering in this space we are

exploring opportunities to enhance our

proposition to support clients in making more

sustainable choices across the spectrum of

lending products throughout 2024 and 2025.

Notes:

1 The exception is India, where we offer strategies developed for

the local market. ESG integration and engagement and voting

are not undertaken.

2 Engagement on select material ESG issues and voting activities

are being exercised in relation to:

For Private Bank: Private Bank DPM investment strategies

globally with the exception of services provided in India.

Engagement activity is undertaken for our direct fixed income

and equity holdings in companies, while voting activity is only

undertaken for our equity holdings. Engagement and voting

activities are undertaken for portfolios managed in the UK,

Jersey, Ireland, Switzerland and Monaco. It is our intention to

exercise voting in all markets, although at times our ability to do

so may be hindered by regulatory and practical considerations as

well as internal restrictions.

For BISL: Direct holdings within BISL DPM investment strategies

and on holdings within segregated mandates that form part of

BISL funds.

3 This is how we are now describing the Green Private Bank

Mortgages referenced in the 2022 Barclays PLC Annual Report.

4 We are continuing to explore the creation of an online hub for

this content.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 120 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b)  |  Strategic Pillar 3 |

|  |  |
| --- | --- |
|  |  |
|  | Embedding climate and  sustainability into our business |
|  |  |
|  | We are embedding climate and sustainability  throughout Barclays, taking into account the  impact of climate-related risks and  opportunities on our businesses, strategy  and financial planning. |
|  |  |

Our Climate Strategy is underpinned by the way

we assess and manage our exposure to climate-

related risk, as well as by our Purpose to work

together for a better financial future for our

customers, clients and communities.

The risks associated with climate change are

subject to rapidly increasing societal, regulatory

and policy focus both in the UK and

internationally. In 2022, Climate risk became a

Principal Risk within our Enterprise Risk

Management Framework, aiming to ensure a

holistic approach to risk identification,

assessment and management.

Barclays' Climate Risk Framework facilitates the

structured integration of climate risk

considerations into the Bank's operations. It

undergoes regular reviews and updates –

including changes to risk taxonomy, definitions

and methodology – which align to align the

Framework with changing regulatory

expectations and external developments.

|  |  |
| --- | --- |
|  |  |
| + | Further details on climate risk identification, assessment  and management can be navigated via the Risk Review  contents section on  page [254](#i4be61753b7f243b19551b0bfbf3a2a0d_580). |
|  |

We continue to build on our inclusion of Climate

Strategy and climate-related risks and

opportunities in our financial planning, working to

further embed these considerations into our

products and services and operations.

We have continued to work on embedding

climate and sustainability considerations into the

culture of the organisation through training and

knowledge building. We have developed several

climate- and sustainability-related mandatory

and non-mandatory training initiatives across the

organisation and provided training to a number of

functions across the Group.

Impact of climate-related risks

and opportunities on our business,

strategy and financial planning

Barclays’ 2023 financial planning process

included a review of our strategy, its

implementation, and tracking of our progress

against climate-related targets – as well as

capturing a view of climate-related risks and

opportunities.

During 2023 we enhanced our monthly reporting

framework to cover a view of the balance sheet

and revenue from Sustainable Financing. This

supports our ability to review our sustainable

financing portfolio at greater granularity and

improve relevant business engagement through

the financial planning process. Enhancements

were made to help us further evaluate the

portfolio's performance and identify

opportunities to maximise revenue generation

activities.

These outputs have been incorporated in our

financial planning process for 2023. Our planning

process also considered current climate policies

to ensure they are included in the base scenario.

We also considered impairment over the horizon

of the financial plan. At this point in time, there

are no material amendments required to the

financial plan.

All key businesses and functions are involved in

integrating climate-related risks and

opportunities into our financial planning process.

Implementing our Climate Strategy is managed

through central Sustainable Finance teams under

the Heads of Sustainable Finance for both CIB

and Barclays UK. We are developing processes

and levers that we anticipate will allow us to

further engage and impact the businesses we

work with.

For example:

• The three pillars of our Climate Strategy, as

well as our Sustainable and Transition

Financing target of $1trn, are key drivers of our

finance planning process with a pathway to

achieve this as well as risks and opportunities

reviewed with business heads

• We continue to develop our green, sustainable

and transition finance banking product sets,

including for retail customers, (for example

green mortgages), bonds/loans (including

Project Finance for renewables) and

securitised products

• We strive to continue to decarbonise our own

operations, reducing our Scope 1 and 2

emissions and our Scope 3 operational

emissions

• We are tracking progress towards portfolio

alignment of our financed emissions with the

goals and timelines of the Paris Agreement

through BlueTrack™, which includes a number

of portfolio alignment metrics and levers

available to manage the portfolio against these

targets while understanding their financial

implications. The metrics are subject to

second-line review by the Climate Risk team to

assess the strategy against the targets. We

have developed an internal approach to track

and monitor progress against our targets and

how we govern these internally

• We conduct portfolio reviews to monitor

whether business activities are conducted

within Barclays’ mandate and aligned with our

expectations, and whether they are of an

appropriate scale relative to the risk and

reward of the underlying activities. Mandate &

Scale Exposure Controls form part of our

overall Risk Appetite Control Framework and

climate risks have been integrated into annual

credit portfolio reviews for elevated risk

sectors since 2020. Furthermore, we have

introduced mandate and scale limits linked to

scoring within our Client Transition

Framework.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 121 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b) |

The 2023 financial planning process used a five-

year climate baseline scenario to consider the

impacts of climate risks. The baseline scenario

considered the impact of current and agreed

climate policies across the UK, US and EU on

macroeconomic variables such as GDP and

Unemployment. This was done via a detailed

assessment of climate policy impacts, likelihood

of implementation and current level of policy

progress. The outcome of this assessment led to

a comparison between the climate baseline

scenario and the scenarios used for financial

planning, indicating a current de minimis impact

on the macroeconomic variables used to project

financial performance. We will continue to review

how climate risks manifest in the economy

through a baseline scenario – and, where these

impacts increase, will consider those within our

financial planning process.

Workstreams specifically related to finance have

been further embedded within our overall global

financial planning processes, including dedicated

climate management reporting information.

Further details of how this work has served as an

input in our five-year financial planning process

are set out below – including our approach to

sustainable financing, targets and capital

investments.

During the 2023 financial planning process we

assessed the financial impact of embedding

individual parts of our Climate Strategy, new

initiatives and targets across our businesses.

This includes the wholesale credit book,

sustainable financing and sustainable lending in

the CIB, and initiatives across our retail

businesses such as green mortgages and

sustainable investing. Build-out of new product

capabilities including Global Project Finance are

also captured.

A range of scenario analyses was undertaken this

year with the aim to further uncover areas of risk

and opportunity, as well as integrate climate

scenario analysis into our strategic and financial

planning. This included two climate stress-tests

with the results allowing Barclays to understand

resilience to Climate risk in those scenarios.

The strategic review of sustainable financing was

also refreshed during the year across Barclays UK

and the CIB. The review built upon both new and

previously identified commercial opportunities.

The output was considered in the financial

planning process, including incremental revenue,

cost and capital.

Key opportunities continue to reside within

Equity Capital Markets, Debt Capital Markets and

lending, and some smaller new markets.

The planning process included an assessment of

our financed emissions reduction targets for

some of our highest-emitting sectors: Energy,

Power, Cement, Automotive and Steel. Barclays

has set absolute emissions or emissions intensity

targets for these sectors and the impacts of

meeting them are integrated into the financial

planning process.

Barclays continues to engage with our clients to

support their transition to a low-carbon

economy. Our current emissions targets are not

forecasted to materially impact financial

performance over the next five years.

The financial planning process also covered a

review of our net zero operations strategy.

Building on the hiring of our Heads of Sustainable

Finance in CIB and Barclays UK, over the past

year we have continued to grow our existing

talent with several strategic hires – with a focus

on expanding our product capabilities as we

continue to drive performance against our

selected targets. Each hire will allow us to further

accelerate our Climate Strategy and increase co-

ordination, with a focus on how we can help our

customers and clients with their individual

transitions to a low-carbon economy.

We will continue to further enhance how our

Climate Strategy is embedded into the way we

think about financial planning over the coming

years – reflecting on the progress we made

during 2023.

Skills, culture and training

Building our expertise

We are aware that responding effectively to

climate and sustainability issues is one of the

greatest challenges facing businesses, investors,

and society today. In 2023 we continued to

educate colleagues on sustainability and climate

change risk and opportunities, their impact on

society and the Bank, and Barclays' strategy and

response.

As we strengthen our sustainability capability and

culture, our colleagues continue to build insights

and expertise to help execute our Climate

Strategy. We have made online learning available

to grow everyone’s knowledge, and created

upskilling for specific areas in line with strategic

priorities – including mandatory training and

targeted development for certain teams relevant

to their roles and responsibilities. This is

alongside investment in our future pipeline of

colleague skills through a newly created

apprenticeship programme. A communications

campaign informed colleagues of how Barclays is

responding to climate change and sustainability

more broadly, reinforcing how they can take

action – including building their knowledge and

skills in this area.

Our suite of Sustainability training resources is

supporting wider awareness across the

organisation, comprising of videos and e-

learning. We intend to evolve this during 2024.

The topics covered include addressing climate

change, principles of sustainability, how we

support our communities, and modern slavery.

During 2023 a mandatory online climate risk

training module was provided to 12,306

colleagues across Risk, Compliance, Internal

Audit, Markets Post Trade and Business Banking.

This training focused on the elevation of climate

to a Principal Risk.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 122 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b) |

In addition, a separate mandatory training

module on Sustainability, ESG and Climate Risk

was delivered to 15,319 colleagues in 2023

across the Corporate and Investment Bank,

Trade and Working Capital, Wholesale

Onboarding and Group FCO, Finance,

Compliance and Public Policy and Corporate

Responsibility – further developing colleagues'

knowledge of the core elements of ESG. This

module focused on how Barclays manages

climate risk, as well as covering the Group

sustainability-related statements and internal

standards and how they should be applied.

|  |
| --- |
|  |
|  |

|  |  |
| --- | --- |
|  |  |
| + | Further details on Barclays' sustainability statements and  policy positions can be found from page  [40](#i4be61753b7f243b19551b0bfbf3a2a0d_217) . |
|  |

We also collaborated with external suppliers to

deliver accredited development programmes

for teams seeking to build specialist

sustainability knowledge. For example, a

development programme began in 2023 for 300

Corporate Bank colleagues in our Sustainability

Academy pilot to develop their climate and

sustainability knowledge. We intend to support

more Corporate Banking colleagues through

the programme during 2024. In addition, we

delivered training to colleagues in the Business

Bank on strategies for supporting SME

customers on their transition to net zero.

In Barclays UK we launched our Sustainability

Champions community to bring together our

most engaged colleagues. In the Consumer

Bank specifically, we provided training on home

energy efficiency and climate risk for mortgage

advisors, and hosted a webinar for mortgage

brokers on retrofitting. We are continuing to

build a targeted learning proposition for our

Corporate and Investment Bank to support

their ongoing development on the client

transition strategy.

Training on greenwashing was delivered to

targeted colleagues in Barclays UK, Private Bank

and Wealth Management, Corporate Bank,

Legal, Compliance, Marketing and Corporate

Communications in EMEA, the US and APAC.

This covered topics including forthcoming

regulation and how to identify and mitigate

greenwashing risk.

In Q3 2023, Sustainability September –

a communications campaign across the

organisation – helped engage colleagues on key

sustainability-related topics. This included short

videos, a series of live recorded conversations

with senior leaders, and associated reading

materials.

To ensure our workforce of the future is well

positioned to understand climate risk, in

November 2023 we introduced a new

Sustainability Apprenticeship – targeting

internal colleagues and working in partnership

with an external provider. The apprenticeship is

one of six selected by industry experts to mark

His Majesty The King’s Coronation, gaining

recognition for educating people to understand

and develop ways to facilitate the transition to a

low-carbon economy. This will encourage the

building of a long-term pipeline of knowledge

throughout Barclays.

Incentives

For the Executive Directors of Barclays PLC,

an element of each of their annual bonus

awards and Long-Term Incentive Plan awards is

driven by non-financial performance measures

– including measures relating to climate and

sustainability.

Barclays’ performance against non-financial

measures, including ESG metrics, is also

explicitly considered in the determination of the

incentive pool – directly impacting pay levels of

the wider workforce.

Non-financial performance for the Executive

Directors’ 2023 annual bonus and the 2023

incentives pool was assessed against three

categories: Customers and clients; Colleagues;

and Climate and Sustainability. The latter

included climate-related measures such as

performance against our Sustainable and

Transition Financing target, financed emissions

reduction targets, carbon footprint reduction,

and increase in renewable energy usage – as

well as measures relating to our investment

in communities.

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| --- | --- |
|  |  |
| + | Further details can be found in our Remuneration report  from page [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) . |
|  |

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| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b) |

|  |  |
| --- | --- |
|  |  |
|  | Just transition and nature  and biodiversity |
|  |  |
|  | We have continued to develop our work on  just transition and nature and biodiversity,  which are intrinsically connected to efforts  to mitigate and adapt to climate change. |
|  |  |

Just transition

During 2023 we continued to see progress on

just transition, with efforts from policymakers,

industry initiatives, civil society and the private

sector.

Following the COP27 Implementation Plan, the

first Annual High-level ministerial roundtable on

just transition took place during COP28 to

discuss the work programme on just transition

pathways. In the UK, the Transition Plan

Taskforce (TPT) integrated the

recommendations of the Just Transition

Working Group in the Disclosure Framework,

encouraging companies to disclose whether –

and how – they have identified, assessed and

taken into account the impacts and

dependencies of the transition plans on

stakeholders, society, the economy and the

natural environment throughout their value

chain.

In turn, the Taskforce for Nature-related

Financial Disclosures (TNFD) Disclosure

Framework included recommendations to

disclose details of human rights policies and

engagement activities with respect to the

assessment and response to nature-related

dependencies, impacts, risks and opportunities.

In this context Barclays continues to

acknowledge the role financial institutions play in

supporting a just transition. We have also

continued our efforts to build an approach to just

transition that considers the social risks and

opportunities of the transition and seeks to

engage relevant stakeholders.

As we pilot our approach to just transition in our

Client Transition Framework, the findings of our

pilot show that 40% of the assessed clients have

committed to a just transition. We will consider

these findings in our engagement with clients.

We also intend to include social considerations as

we develop our transition plan.

Barclays UK has continued to identify

opportunities to address the social challenges of

the transition in the context of the energy crisis.

For example, in 2023 we launched a pilot with our

strategic partner British Gas, aiming to support

thousands of customers experiencing low

financial wellbeing in accessing support with their

energy bills and relevant grants to make energy-

efficiency-related improvements to their homes.

We have continued to contribute to the

development of a just transition approach for the

financial sector through our engagement with

initiatives and the organisation of thought

leadership events and discussions, as described

below:

• During New York Climate Week Barclays

hosted an event with UNEP FI, Ceres and

Boston Consulting Group (BCG), bringing

together leaders in the sustainability and

finance space to discuss the role finance can

play in ensuring an equitable climate transition.

• During COP28 Barclays co-hosted and

organised three events alongside its partners:

– an event with LSE discussing the barriers to

investing in emerging markets and

mobilising debt markets;

– an event with Ceres on the regional

approach to financing a just transition; and

– an event with BCG and Ceres discussing

whether financial institutions can facilitate a

just transition through cleantech financing

and green jobs.

• As part of our participation in the LSE

Financing a Just Transition Alliance (FJTA), we

contributed to the report 'Sowing seeds: How

finance can support a just transition in UK

agriculture', which was designed to increase

understanding across the financial sector of

how it can support a just transition in

agriculture by mobilising more finance towards

companies committed to and making

progress to support a just nature transition.

• Barclays is a Founding Funder of LSE's Just

Transition Finance Lab, which launches in

February 2024. The Lab plans to work on the

development of financial tools and

instruments for the just transition, metrics to

measure just transition performance; identify

appropriate policy reforms to help to mobilise

finance for the just transition, and develop

case studies that demonstrate how just

transition finance can be applied in practice.

Cognisant of the importance of local approaches

for just transition and the integration of the

voices of impacted stakeholders, we also

organised a stakeholder engagement, with the

support of Ceres, that allowed us to access the

perspectives of investors, non-profits, and

community leaders to help our understanding of

just transition in the US.

Our approach to nature

and biodiversity

Banks have an important role to play in

contributing to nature-positive  finance and

managing their nature-related risks.

Nature is a key sustainability focus for Barclays and

the wider industry going forward, given that nature

and its ecosystem services fundamentally

underpin economies and societies. Nature is also

important to the banking sector due to the

interlinkages with climate change and social

impacts, with disclosure requirements moving

towards a holistic approach to nature, climate and

social risks and opportunities. During 2023 nature

loss continued to be recognised within new and

emerging guidance and regulation. Significantly for

companies and financial institutions, the TNFD

finalised its framework for organisations to assess

and disclose nature-related risks and

opportunities. Upcoming disclosure requirements

on nature-related topics were confirmed under

the EU Corporate Sustainability Reporting

Directive, as well as within guidance published by

the TPT regarding incorporating nature-related

impacts and dependencies associated with

climate transition plans.

We continue to work to build an understanding of

the ways our activities and those of our clients

impact and depend on nature. This includes

engaging with industry and cross-sector groups

as detailed in the 'Engagement' section on the

following page. We continue to explore how to

integrate these considerations into policy and

process and reviewing the ways our financing

activities can contribute to nature.

Given the interdependencies across the climate,

nature and social agendas, reviewing ways we

can address these areas holistically is important.

For instance, drawing on the work of the TPT, we

are considering nature-related topics in our

sector approach for Agriculture. See page [93](#i4be61753b7f243b19551b0bfbf3a2a0d_1099511636004) for

details.

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 124 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b) |

During 2023 we worked on setting the

foundation to our approach on nature through

planning and preparation to understand nature-

related regulatory obligations and disclosure

frameworks, and build consensus for strategic

action in 2024. We recognise the need for

continuous improvement with regard to available

data and technologies, in particular noting the

complexity and challenge given the number of

nature attributes and their associated metrics.

During 2023 we engaged with a number of data

providers to better understand data availability

and capability. The following sets out a summary

of this work.

|  |  |
| --- | --- |
|  |  |
| + | Further information on our approach to nature can be found  throughout the report.  Nature-related risk - see pages [69](#i4be61753b7f243b19551b0bfbf3a2a0d_18684), [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720), and [276](#i4be61753b7f243b19551b0bfbf3a2a0d_12263)  Nature-related opportunity - see page [105](#i4be61753b7f243b19551b0bfbf3a2a0d_18024)  Nature-related governance - see page [232](#i4be61753b7f243b19551b0bfbf3a2a0d_9553)  Nature in our operations - see page [79](#i4be61753b7f243b19551b0bfbf3a2a0d_18002)  TNFD pilot - see page [276](#i4be61753b7f243b19551b0bfbf3a2a0d_12263) |
|  |

Nature-related risk in financing

We include financing restrictions that seek to

address nature-related risk within our position

statements on Forestry and Agricultural

Commodities, World Heritage Sites and Ramsar

Wetlands, and Climate Change. We continue to

review and monitor how we can strengthen our

approach. In 2023 we undertook a significant

update of our Forestry and Agricultural

Commodities Statement to  expand the scope to

include, for the first time, requirements for

clients involved in South American beef

production or primary processing and enhanced

the existing requirements for clients involved in

palm oil and soy. See page [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720).

We have continued to develop our approach to

evaluating nature-related risk in financing. This

included building on work across 2022-23 in

which we piloted the TNFD Framework on our

lending portfolio for Agriculture and Food in

Europe, with a focus on UK Farming – in which

Barclays has a significant presence. The results

informed development of new questions for the

Client Transition Tool (CTT) for UK farmers,

which are due to be incorporated in 2024. See

page [93](#i4be61753b7f243b19551b0bfbf3a2a0d_1099511636004) for details of our approach to the UK

Agriculture sector. In recognition of nature-

related impacts identified in the agricultural value

chain, we also strengthened our approach to

financing agricultural commodity sectors

exposed to significant deforestation risk.

We refined the work undertaken in 2022 to

develop a sectoral heatmap, refreshing the

industries included to align with the TNFD’s

priority sector list. Our proposed next steps

include consideration of the TNFD LEAP

framework to conduct further sector-level

analysis. See page [69](#i4be61753b7f243b19551b0bfbf3a2a0d_18684) for more details.

|  |  |
| --- | --- |
|  |  |
| + | Further details can be found in our position statements on  the Barclays ESG Resource Hub at: [home.barclays/](https://home.barclays/%20sustainability/esg-resource-hub/)  [sustainability/esg-resource-hub/](https://home.barclays/%20sustainability/esg-resource-hub/)  Further details on our position statements can be found in  the non-financial information statement from page  [40](#i4be61753b7f243b19551b0bfbf3a2a0d_217). |
|  |

Nature-related financing

Nature-related financing presents significant

future opportunities for the financial sector,

given the capital requirements to address and

reverse nature loss. The biodiversity financing

gap is estimated to be $700bn per year¹.

We will continue to work towards meeting our

green and sustainable finance targets, which

include financing relevant to nature.

Our Sustainable Finance Framework includes

categories such as Sustainable Food, Agriculture,

Forestry, Aquaculture and Fisheries, which we

have mapped to nature-related UN SDGs –

including SDG14, Life Under Water, and SDG 15,

Life on Land.

In Barclays UK we believe the nature transition is

a key area where we can make an impact due to

our prominent role in financing UK agriculture

and agricultural land purchases. In 2023

examples of nature-related financing have

included lending funds in relation to the

Biodiversity Net Gain scheme and support for

farmers who seek to apply more sustainable

farming practices.

We are supporting environmentally-focused

climate technology start-ups through our SIC

portfolio led by Barclays’ Principal Investments

team. We are also exploring nature-related

products and solutions for our clients in the CIB.

See page [105](#i4be61753b7f243b19551b0bfbf3a2a0d_18024) for details.

|  |  |
| --- | --- |
|  |  |
| + | For more details of our green and sustainable financing and  financing nature see the  ‘Financing the transition section  from page  [105](#i4be61753b7f243b19551b0bfbf3a2a0d_18024). |
|  |

Note:

1 cbd.int/doc/decisions/cop-15/cop-15-dec-04-en.pdf

Engagement

We  see appropriate  collaboration and

engagement across industry as essential for

sharing learnings across the sector and a

successful nature-related transition.

In 2023 we continued to provide feedback to the

TNFD  – both bilaterally, as part of our

membership of the TNFD Forum, and through

industry groups ahead of the finalisation of  the

TNFD Framework.

Barclays provided input into the nature

components of the TPT's disclosure guidance

for climate transition plans as part of the TPT’s

Nature Working Group. See page [61](#i76394ec5a9c94eba84518460501a2b5d_1-1-1-1-2512877) for details of

our wider engagement with TPT.

We continued engagement with a number of

industry and cross-sector groups, including the

UN Principles for Responsible Banking (PRB)

Nature Working Group – with which we fed into a

guide to setting targets relating to banks'

practices and processes on nature. We further

provided input into the LSE's FJTA's publication

on a just nature transition – see page [124](#i4be61753b7f243b19551b0bfbf3a2a0d_7854) for

details.

As part of the Sustainable Markets Initiative’s

Financial Services Task Force, Barclays co-led

the publication of a guide on Financing Coastal

Nature-based (NbS) Solutions - see page [105](#i4be61753b7f243b19551b0bfbf3a2a0d_18024) for

details.

Barclays completed the third and final year of our

partnership with the Blue Marine Foundation,

which had the aim of supporting them in seeking

to deliver their goal of ensuring that at least 30%

of the global ocean is effectively protected and

the other 70% sustainably managed by 2030.

Our donation contributed to conservation

outcomes including support for more than

445,000km of newly designated Marine

Protected Areas (MPAs), 900km2 of newly

proposed MPAs, and advocacy and educational

outreach to support the ongoing protection and

restoration of the ocean – including through the

award-winning 'The Sea We Breathe' educational

site.

|  |  |
| --- | --- |
|  |  |
| + | Further details on Blue Marine Foundation can be found at:  bluemarinefoundation.com  bluemarinefoundation.com/the-sea-we-breathe/ |
|  |

|  |  |
| --- | --- |
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| + | For more details, see:  unepfi.org/industries/banking/nature-target-setting-  guidance/  lse.ac.uk/granthaminstitute/publication/sowing-seeds-how-  finance-can-support-a-just-transition-in-uk-agriculture/  a.storyblok.com/f/109506/x/6298e4ed77/2023-11-22\_fstf-  financing-coastal-nbs-report\_final.pdf |
|  |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 125 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b) |

|  |  |
| --- | --- |
|  |  |
|  | Engaging with industry |
|  |  |
|  | We know that leveraging the relationships  we hold with stakeholders can support all of  us in achieving our objectives. |
|  |  |

Continued engagement in the financial sector

and other areas of the real economy and public

sector will be important in delivering the actions

necessary to meet our global sustainability goals.

At a minimum, strategic partnerships with key

stakeholders enables knowledge sharing and

supports informed decision making.

Collaborating with NGOs, academia, government

agencies, private sector peers and local

communities enhances our ability to understand,

assess and address the intricate issues

associated with climate change. These

partnerships have the potential to uncover

opportunities to deploy capital into areas that

suffer from existing financing gaps and scale

companies to disrupt markets and innovate for

impact. During 2023, Barclays contributed to

several workstreams across climate, nature, just

transition, and advancing data and reporting

standards.

Our involvements in these workstreams

highlighted the significant financing gaps that

exist across sectors and markets. This theme

was in full focus throughout our conversations at

London Climate Action Week, New York Climate

Week, and COP28 in Dubai, where we hosted and

co-hosted several action-oriented sessions. At

COP28 we sponsored the Start-Up Village

located in the Green Zone, which enabled over

100 start-ups to demonstrate their various

climate technologies on a world stage – including

three Barclays SIC portfolio companies:

ZeroAvia, GeoPura, and ECOncrete.

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|  | BAR_NVI_S_NZ_250.jpg | | | |  |
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|  | PCAF Capital Markets working group | | | |  |
|  | Barclays has been an active member of the Partnership for Carbon Accounting Financials (PCAF)  – an industry-wide initiative that aims to build consensus on approaches to carbon accounting,  disclosure and portfolio alignment – since 2020. In 2023, and for the third year running, Barclays  co-chaired the PCAF Capital Markets working group comprising eight other banks.  The working group has developed a standard to account for the facilitated emissions associated  with capital markets transactions, which was published in December 2023. The Standard (Part B)  builds on the extensive work carried out by the working group over the past three years and  follows on from the 2021 Discussion Paper, the 2022 Proposed Methodology document, and two  public consultations. | | | |  |
|  |  |  |  |  |  |
|  | + | Further details can be found at: carbonaccountingfinancials.com/files/  PCAF-PartB-Facilitated-Emissions-Standard-Dec2023.pdf |  |  |  |
|  |  |  |  |  |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 126 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b) |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Engaging with industry | |  |
| External initiatives, signatories or memberships |  | Additional information |
| Multi-thematic | |  |
| L_TC_SMI_Lockup_Horizontal_Multi_Dark (1).jpg | Sustainable  Markets Initiative | Barclays is a member of the Sustainable Markets Initiative's (SMI) Financial Services Task Force (FSTF). The Sustainable Markets Initiative was  launched in 2020 by His Majesty King Charles III, when he was Prince of Wales. Barclays has co-led the Net Zero working group since 2021 and  in 2023 co-led the Nature-based Solutions (NbS) working group. We co-hosted a series of FSTF workshops at London Climate Action Week  and New York Climate Week contributing towards the launch of the Coastal Nature-based Solutions Practitioner's guide in November 2023. |
|  | Transition Plan  Task Force | In 2023 Barclays contributed to the Transition Plan Taskforce (TPT)'s publication of sector-agnostic and sector-specific guidance  documents. This included taking part in the TPT Sandbox, participating in the Banking, Metals & Mining, Food & Beverage, Nature and Just  Transition working groups, and providing expert reviews for the Oil & Gas working group. |
| UNEP FI Logo_Blue Land.jpg | United Nations  Environment  Programme -  Finance Initiative | Barclays has been a member of United Nations Environment Programme – Finance Initiative (UNEP FI) for over 20 years and was a founding  signatory of the UN Principles for Responsible Banking (PRB) as well as joining the Net-Zero Banking Alliance in 2021. From 2021 Barclays' Group  Head of Sustainability has been a member of the global UNEP FI Banking Board and the European Regional Board, and our CEO joined the  Leadership Council in 2022. Throughout 2023 Barclays has contributed to the PRB 2030 process, a strategic project to further develop the UN  PRB framework, and participated in the Nature Target Setting Working Group – helping build guidance and inputting on case studies. |
| Just transition | |  |
| GRI-LSE lockup.jpg | LSE/Grantham  Research Institute | Barclays joined over 40 financial institutions and stakeholders to form the Financing a Just Transition Alliance in 2021. In 2023 we contributed  to a report titled 'Sowing seeds: How finance can support a just transition in UK agriculture', which was designed to increase understanding  across the financial sector of how it can support a just transition in agriculture by mobilising more finance towards companies committed to  and making progress to support a ‘just nature transition’. Barclays became a Founding Funder of the Just Transition Finance Lab, launched on  20 February 2024. |
| Ceres.jpg | Ceres | Barclays has been an active member of the Ceres Company Network since 2019. In 2023 we partnered with Ceres to conduct a stakeholder  engagement as a follow up to the research Ceres conducted in 2022 on our just transition strategy. We additionally co-hosted a series of  just-transition-focused workshops at both New York Climate Week and COP28. |
| Nature and biodiversity | |  |
| TNFD Forum Member logo 1 Blue.png | Taskforce on  Nature-related  Financial  Disclosures Forum | Barclays is a member of the Taskforce on Nature-related Financial Disclosures (TNFD) Forum, a consultative network of institutional  supporters who share the vision and mission of the TNFD. Throughout 2023 we actively provided feedback on the draft TNFD disclosure  guidance, which was officially launched in September 2023. |
| Climate and sustainability | |  |
| GFANZ_Logo_SM-2_K (002).png | Glasgow Financial  Alliance for Net  Zero | In 2023 Barclays contributed to the GFANZ Decarbonization Methodology working group, which at COP28 in December 2023 published a  'Technical Review Note on Scaling Transition Finance and Real-economy Decarbonization, a Supplement to the 2022 Net-Zero Transition  Plan Report'. |
| NZBA PRB logo_Cloudy blue.jpg | Net-Zero Banking  Alliance | Barclays became a founding member of the Net-Zero Banking Alliance in 2021 and contributed to the development of NZBA guidelines throughout  2023. Barclays co-leads the NZBA Autos and Trucking Working Group, which published a white paper on emerging practice in climate target setting  for automotive sector financing, and contributed to the NZBA Real-Estate Working Group – which published a similar paper in December 2023. |

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 127 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b) |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Engaging with industry | |  |
| Industry collaboration | | Additional information |
| Climate and sustainability | |  |
| 5.a.Oxford SFG.jpg  5.b.CFGFI.jpg | Oxford Sustainable  Finance Group  & the UK Centre for  Greening Finance  and Investment | As part of Barclays' three-year partnership with Oxford University, we made progress on developing new datasets and methodologies for  measuring emissions in the agriculture sector – which Barclays will leverage moving forward as it enhances its work in this area. |
| 6. PCAF.jpg | Partnership for  Carbon  Accounting  Financials | Barclays has been a member of PCAF since 2020. During 2023 we co-chaired the Capital Markets Working Group of eight global banks – the  work from which resulted in the publication of the PCAF Facilitated Emissions Standard (The Standard, Part B), which outlines how financial  institutions should account for the emissions associated with the facilitation of capital markets activities. |
| 7.CFRF.jpg | PRA/FCA Climate  Financial Risk  Forum | The Climate Financial Risk Forum (CFRF) brings together UK regulators and senior financial sector representatives to share their experiences  in managing climate-related risks and opportunities. During 2023, Barclays chaired the Climate Financial Resilience Working Group. |
| Large_PNG-RMI_logo_PrimaryUse (1) (002).png | RMI's Center for  Climate Aligned  Finance | Barclays became a Strategic Partner of the RMI (formerly Rocky Mountain Institute) Center for Climate-Aligned Finance, which acts as an  implementation partner to banks to align their investments with a net zero future, in 2022. In 2023 we participated in and hosted one of RMI's  Alignment Forum in-person workshops, seeking to identify best practices within the financial sector. In Q3 2023 Barclays became a Founding  Consortium Collaborator to support the expansion of RMI’s Oil Climate Index plus Gas – a public tool that uses a transparent, standardised  methodology to estimate methane and other GHG emissions from equivalent barrels of oil and gas. RMI has currently modelled two-thirds of  the world’s oil and gas assets. We also joined the joint RMI and UK Finance Transition Finance Alignment Forum. |
| image.png | World Business  Council for  Sustainable  Development | Barclays became a member of the Banking for Impact on Climate in Agriculture (B4ICA) in 2021 – an initiative convened by the World Business  Council for Sustainable Development that brings together banks and expert partners to develop technical recommendations and practical  solutions to align banks’ financial portfolios in the food, agriculture, and land-use space towards net zero and Paris Agreement goals. In 2023  we contributed to B4ICA's 'Foundational Practices for Banks: Base lining, net-zero target-setting and reporting financed emissions across  the agriculture and food value chain'. |
| C2ES logo final right text RGB (1) (002).png | Center for Climate  and Energy  Solutions (C2ES) | Barclays joined the Center for Climate and Energy Solutions (C2ES) Business Environmental Leadership Council (BELC) in 2022. In 2023 we  collaborated with C2ES on a range of issues, including participating in their technology working group and co-hosting an event at COP28 on  supporting the global climate technology momentum. |
| UKBCH logo colour on transparent (002).png | UK Business  Climate Hub | In the final quarter of 2023, Barclays partnered with the UK Business Climate Hub – an online portal supporting SMEs on their journey to net  zero. Barclays is helping shape and enhance the resources the Hub provides to UK business, ensuring our SME clients' voices are heard and  their needs met. This new partnership will help each SME client understand why sustainability is important for their business and what 'good'  looks like in the context of their industry. |

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| --- | --- |
|  |  |
| + | Barclays' register of our engagement with industry  initiatives, working groups and memberships can be  found at:  [home.barclays/sustainability/esg-resource-hub/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [reporting-and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/) |
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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 128 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b) |

|  |  |
| --- | --- |
|  |  |
|  | Barclays' approach to public policy |
|  |  |
|  | We have a responsibility to engage with  governments and policymakers  constructively, while remaining politically  neutral. |
|  |  |

Transparency and governance

As a major economic and societal contributor to the

communities in which we operate – whether via the

products we offer, the customers and clients we

serve, the colleagues we employ, or the contribution

we make through our community investment

programme – we believe it is also important to

contribute to relevant public policy debates. We

seek to engage constructively with policymakers in

jurisdictions where the firm operates, including with

governments, legislatures, regulators and other

organisations.

In our discussions we seek to make contributions

that are accurate, honest and evidence-based.

Barclays’ advocacy and engagement activities,

including direct and indirect lobbying, must also be

undertaken in line with our internal controls –

including Barclays’ code of conduct (The Barclays

Way), which requires that "where we engage with

governments and regulators on issues relevant to

our business, we are honest and transparent in our

communication with them". The Barclays Way also

provides detailed guidance on speaking up and

raising concerns, directing employees to speak up if

they see "behaviours and practices that are not in

line with our Barclays Values" – making clear that

speaking up, whether formally or informally, will not

come at a consequence to them. We also believe

that Barclays should only engage on issues where

we have a legitimate interest – for example where

there is a consequence for our business, our

customers and clients, or our colleagues. Barclays’

Group Head of Strategic Policy is responsible for the

co-ordination and oversight of public policy

advocacy.

Barclays retains the services of public affairs

agencies in certain jurisdictions. These agencies

primarily assist with political monitoring and

strategic advice. We work very closely with these

agencies on a day-to-day basis, to help ensure that

the Strategic Policy Group has oversight of the work

being undertaken for Barclays.

Advocacy with public officials in the US is publicly

reported, as required by the Lobbying Disclosure

Act. Barclays also discloses its EU advocacy

activities on the European Commission’s

Transparency Register.

In addition, Barclays is a member of a number of

trade associations globally. These associations work

to represent their members, and for many this

involves undertaking work to shape industry’s

collective response to various public policy issues.

We seek to be an engaged and productive member

of all associations in which Barclays participates,

predominantly through the committees and

working groups formed by each. Active participation

in the discussions and working groups facilitated by

these trade associations helps encourage the

adoption of policy positions consistent with

Barclays’ public policy objectives. Where we identify

divergence on key policy matters we seek to engage

and influence these positions. The Strategic Policy

Group also supports senior executives occupying

trade association board positions, as appropriate.

As part of our commitment to transparency we

publish a range of information on our Public Policy

Engagement website, including certain details

regarding the aforementioned agencies and trade

association memberships. We also publish details of

Barclays’ bilateral responses to material

government and public policy consultations on

certain issues with which we are principally engaged,

in the UK and EU, either in full summary or part. In

other jurisdictions, including across Asia and the US,

responses to public consultations are published on

the respective government websites.

|  |  |
| --- | --- |
|  |  |
| + | Our Public Policy Engagement website can be found at:  [home.barclays/sustainability/esg-resource-hub/reporting-](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/public-policy-engagement/)  [and-disclosures/public-policy-engagement/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/public-policy-engagement/) |
|  |

Climate policy engagement

Barclays seeks to proactively engage in climate and

sustainable finance-related public policy

conversations and development, directly and

indirectly, consistent with our business strategy –

including our ambition to be a net zero bank by

2050 and our commitment to aligning our

financing with the goals and timelines of the Paris

Agreement.

We proactively pursue opportunities for senior-

level dialogue with policymakers to demonstrate

private sector leadership on sustainable finance

and the energy transition. We provide feedback, as

an individual institution and via trade associations

to relevant consultation processes launched by

standard setters, multilateral organisations and

NGOs, including those that could inform future

policy recommendations. We also engage with

governments and other key stakeholders to

promote policies that facilitate greater investment

in climate solutions. This includes participating in

key international and domestic forums – such as

the United Nations Climate Change Conference

(COP28) and the UK’s Global Investment Summit

2023 – to promote net-zero-aligned public policy

at senior levels.

Barclays endeavours to support the development

of public policy positions that facilitate sustainable

finance and the broader energy transition through

proactive engagement in relevant trade

association working groups, where we seek to

promote positions consistent with our ambition to

be a net zero bank by 2050. We engage with many

trade associations on climate issues and will

continue to do so to promote our net zero

objectives. Reflective of the pace of developments

and regional differences in approaches to

sustainability, there can be diverging views within

trade associations. Many of these trade

associations also do not focus exclusively on

sustainability, but rather engage across the full

breadth of financial services-related policy – and do

not have stated positions in relation to net zero.

Where misalignment between an association’s

advocacy position and Barclays’ own net zero

ambitions is identified, we seek to manage this

appropriately by addressing it through proactive

engagement where possible. Where there is a

material and ongoing difference identified through

our routine engagement, Barclays may publicly

dissent from a trade association’s position. Should

a trade association adopt a material position that,

following engagement, remains irreconcilable with

our Values or strategy, we can exercise the option

to end our membership.

In 2023 we undertook another internal review of

the climate policy positions of certain material

trade associations, including their alignment with

our ambition to be a net zero bank by 2050 and our

commitment to aligning our financing with the

goals and timelines of the Paris Agreement. A list

of these trade associations in scope can be found

on our Public Policy Engagement web page. This

review was informed by publicly available

information on each trade association’s website,

which could include climate policy position

statements and, where directly related to climate,

consultation responses, commission reports and

statements from an association’s senior

leadership. For a number of trade associations in-

scope of the review, we were unable to identify a

clearly articulated position on net zero. Of those

with a clear position, the majority were considered

to be aligned or partially aligned with our net zero

by 2050 ambition. In 2023 we began to proactively

engage with trade associations to better

understand their climate policy positions and

activities, and we will continue to keep our

approach under review.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 129 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Implementing our Climate Strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (b) |

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Resilience of our strategy | | | | | | | | | | | |  |  |  |
|  |  |  | | | | | | | | | | |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | TCFD Strategy Recommendation A: |  |  |  |  | TCFD Strategy Recommendation B: |  |  |  |  | TCFD Strategy Recommendation C: |  |  |  |
|  |  | Describe the climate-related risks and  opportunities the organisation has identified  over the short, medium, and long term. |  |  |  |  | Describe the impact of climate-related risks and  opportunities on the organisation’s businesses,  strategy, and financial planning. |  |  |  |  | Describe the resilience of the organisation’s  strategy, taking into consideration different climate-  related scenarios, including a 2°C or lower scenario. |  |  |  |
|  |  | [Risks and opportunities](#i4be61753b7f243b19551b0bfbf3a2a0d_250) | [66](#i4be61753b7f243b19551b0bfbf3a2a0d_250) |  |  |  | [Implementing our climate strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_259) | [72](#i4be61753b7f243b19551b0bfbf3a2a0d_259) |  |  |  | [Resilience of our strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_406) | [130](#i4be61753b7f243b19551b0bfbf3a2a0d_406) |  |  |
|  |  | [Risks](#i4be61753b7f243b19551b0bfbf3a2a0d_253) | [67](#i4be61753b7f243b19551b0bfbf3a2a0d_253) |  |  |  | [Achieving net zero operations](#i4be61753b7f243b19551b0bfbf3a2a0d_262) | [73](#i4be61753b7f243b19551b0bfbf3a2a0d_262) |  |  |  | Scenario analysis | [131](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061446) |  |  |
|  |  | [Opportunities](#i4be61753b7f243b19551b0bfbf3a2a0d_256) | [70](#i4be61753b7f243b19551b0bfbf3a2a0d_256) |  |  |  | Operational footprint dashboard | [75](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686060018) |  |  |  | Barclays’ resilience to climate scenarios | [132](#i4be61753b7f243b19551b0bfbf3a2a0d_16082) |  |  |
|  |  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_271) | [76](#i4be61753b7f243b19551b0bfbf3a2a0d_271) |  |  |  | Climate stress tests | [132](#i4be61753b7f243b19551b0bfbf3a2a0d_16082) |  |  |
|  |  |  |  |  |  |  | [Reducing our financed emissions](#i4be61753b7f243b19551b0bfbf3a2a0d_283) | [80](#i4be61753b7f243b19551b0bfbf3a2a0d_283) |  |  |  | 2023 Enhancements and beyond | [134](#ib4213872474249fd834c9b5748668ac3_2-1-1-1-2543322) |  |  |
|  |  |  |  |  |  |  | BlueTrackTM  dashboard | [88](#i4be61753b7f243b19551b0bfbf3a2a0d_12116) |  |  |  | Challenges and limitations | [135](#ic42a2c24620a4a25a4eb81cde6bc5f7a_2-1-1-1-2582708) |  |  |
|  |  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_289) | [89](#i4be61753b7f243b19551b0bfbf3a2a0d_289) |  |  |  | Macro-dependencies and objectives | [136](#i4be61753b7f243b19551b0bfbf3a2a0d_16064) |  |  |
|  |  |  |  |  |  |  | [Financing the transition](#i4be61753b7f243b19551b0bfbf3a2a0d_319) | [101](#i4be61753b7f243b19551b0bfbf3a2a0d_319) |  |  |  | [Important information/disclaimers](#i4be61753b7f243b19551b0bfbf3a2a0d_427) | [137](#i4be61753b7f243b19551b0bfbf3a2a0d_427) |  |  |
|  |  |  |  |  |  |  | [Sustainable finance dashboard](#i4be61753b7f243b19551b0bfbf3a2a0d_328) | [103](#i4be61753b7f243b19551b0bfbf3a2a0d_328) |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [All other narrative](#i4be61753b7f243b19551b0bfbf3a2a0d_331) | [104](#i4be61753b7f243b19551b0bfbf3a2a0d_331) |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Working with our clients](#i4be61753b7f243b19551b0bfbf3a2a0d_334) | [107](#i4be61753b7f243b19551b0bfbf3a2a0d_334) |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Embedding Climate and Sustainability into our](#i4be61753b7f243b19551b0bfbf3a2a0d_379)  [business](#i4be61753b7f243b19551b0bfbf3a2a0d_379) | [121](#i4be61753b7f243b19551b0bfbf3a2a0d_379) |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Just transition and nature and biodiversity](#i4be61753b7f243b19551b0bfbf3a2a0d_388) | [124](#i4be61753b7f243b19551b0bfbf3a2a0d_388) |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Engaging with industry](#i4be61753b7f243b19551b0bfbf3a2a0d_397) | [126](#i4be61753b7f243b19551b0bfbf3a2a0d_397) |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | [Barclays' approach to public policy](#i4be61753b7f243b19551b0bfbf3a2a0d_400) | [129](#i4be61753b7f243b19551b0bfbf3a2a0d_400) |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Scenario analysis |  |
|  | Climate scenario analysis forms a key part of  Barclays' approach to assessing and  quantifying the impact of physical and  transition climate risks on the Bank's  portfolios¹. It represents a tool in better  understanding the significant uncertainty  that arises from how climatic weather  patterns will change, as well as the rapidly  evolving nature of the climate transition  from government policies, new technologies  and changing individuals' sentiment. |  |
|  |  |  |

Through climate scenario analysis, these risks

and uncertainties can be translated into financial

impacts to the Bank, allowing Barclays to better

understand the resilience of its business

strategy.

History and evolution

Since 2018 Barclays has progressively developed

its internal scenario analysis capabilities,

developing new climate assessment

methodologies, running internal targeted

exercises with external subject matter experts,

and participating in regulatory climate stress-

testing.

Barclays continues to build its use of scenario

analysis to explore and further understand the

evolving landscape – identifying areas of risks and

opportunities – to challenge existing

assumptions of future climate pathways and

measure and size of the risks of climate change

to the Bank.

Note

1 Informed by the Basel Committee on Banking Supervision's 2021

'Climate-related financial risks - measurement methodologies'

report, Barclays considers climate scenario analysis as forward-

looking projections of climate risk outcomes, with climate stress-

testing a subset of this where the exercise is designed to

evaluate financial resiliency to a severe but plausible scenario.

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  | Internal short-term  transition scenario  • Short-term assessment exploring the  potential transition risk impact of a  ‘Climate Minsky Moment’ with a rapid  market correction, followed by broader  macroeconomic shocks.  • Scenario narrative and shocks  informed by external publications such  as the RA insurance climate stress and  DNB energy transition stress test. | | | |  |  | Exploratory climate scenarios by  the Bank of England (BoE)  • Barclays participated in the BoE’s  Climate Biennial Exploratory Scenario.  • Stress test covers three long-term  scenarios: Early Action, Late Action and  No Action.  • Assessments focused on credit risk  impacts to wholesale and retail  portfolios. | | | |  |  | Stress-testing and integration  • Quantitative integration of stress-  testing results into internal capital  adequacy and CET1 assessments.  • Conduction of two short-term climate  stress tests, including a physical tipping  point (H1) and full macroeconomic  expansion (H2).  • Development of new climate-aware  models and methodologies. | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 2018 | |  | 2019 | |  | 2020 | |  | 2021 | |  | 2022 | |  | 2023 | |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | External case studies through  UNEP FI  • Case study exercises covering Power,  Utilities, Oil and Gas and Residential Real  Estate.  • Scenario assessment based on REMIND  2°C scenario, assessing a specific client  set in each sector.  • Judgement-led and simplistic approach  to calculate climate probabilities of  default. | | | |  |  | Internal climate scenarios  informed by NGFS  • Long-term climate internal stress test.  • Scenario narrative and shocks informed  by NGFS Disorderly Transition,  combined with internal scenario of  comparable sensitivity (pre-COVID  IFRS 9 Downside 1).  • Second assessment considered  incremental physical risk impact from  the Hot House World scenario. | | | |  |  | Framework, regulatory and  internal scenario analysis  • Barclays participated in regulatory  stress-tests such as ECB CRST.  • Conduction of bespoke internal  scenario analysis exercise.  • Development of an internal framework  to structure scenario-based climate  risk measurement exercises. | | | |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 131 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Resilience of our strategy | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Barclays' resilience to climate  scenarios |  |
|  |  |  |
|  | Based on the exercises undertaken to date,  our understanding is that Barclays' strategy  remains resilient to climate scenarios. This  assessment includes consideration of two  climate stress tests completed in 2023,  with further details included in subsequent  sections of this chapter.  In addition Barclays considers the impact of  climate scenarios within its financial  planning process, including the use of a  baseline climate scenario within the  Medium Term Planning process and the  financial impacts from Barclays meeting its  sectoral BlueTrackTM targets, aligned to  1.5°C scenario pathways. Finally, Barclays  has considered the impact of climate  scenarios within its assessment of  Expected Credit Losses reported under  IFRS9, for year-end 2023. More detail on  these two elements can be found on page  [121](#i4be61753b7f243b19551b0bfbf3a2a0d_382) and [310](#i4be61753b7f243b19551b0bfbf3a2a0d_12647) respectively.  Nevertheless, given the evolving climate  landscape, we seek to further enhance our  capabilities and modelling in order to refine  our understanding of the Bank's resilience  to various climate scenarios, particularly  given high uncertainty within climate  scenario analysis. |  |
|  |  |  |

The aims of our two climate stress tests, each

with their own scenario, were to assess Barclays'

financial resiliency to climate risks over and above

the financial impact of existing macroeconomic

internal stress tests – and the extent to which

Barclays would remain within risk appetite.

Both stress tests were designed as Bank-wide

exercises, conducted over a five-year time period,

to assess an accelerated transition and specific

climate vulnerabilities to the Bank's business plan.

These exercises include an assessment of the

financial impact to our clients of a structural

decline in fossil fuel demand and consumption and

shift towards low-carbon products and services.

The two scenarios have been internally designed

with consideration of Barclays' specific portfolio

vulnerabilities. External scenarios such as those

provided by the Network for Greening the

Financial System (NGFS), while offering granular

and detailed scenario information for financial

institutions, tend to focus on longer trends and

display limited volatility, with assumptions that

may be less relevant to our specific businesses.

As such we have designed scenarios with a

greater focus on short-term tail risks and

volatility to assess Barclays' resiliency.

Results of the two exercises indicate a c.10%

drag on the Bank’s profitability, falling in the range

projected for the UK banking sector by the Bank

of England's 2021 Climate Biennial Exploratory

Scenario (CBES). In addition the exercises

represent a c.10-20% uplift in losses incurred in

existing macroeconomic internal stress tests. In

order to manage and mitigate these potential

risks, Barclays has for the first time quantitatively

integrated the results of its stress tests into its

internal capital adequacy assessments, ensuring

the Bank remains appropriately capitalised for

climate risks, and to ensure business resilience.

The results of our exercises have highlighted

risks within our key businesses to either Physical

Risk, Transition Risk or both. We have aggregated

results for Barclays' three main business units,

Barclays International, Retail and SME Banking,

and Head Office, in the heatmap on the right for

the stress test most recently completed.

The assessment indicates the relative impact

from the climate scenario against Barclays'

medium-term plan, calculated as the additional

losses compared to the expected business cycle.

Losses appear highest in the Barclays

International segment relative to the baseline.

This is predominantly attributed to our Global

Banking & Markets business, driven by exposure

to more carbon intensive sectors that are most

impacted from the fast transition scenario, such

as the introduction of carbon pricing schemes. In

addition, cascading transitional impacts drive up

unemployment, stressing our cards portfolios.

Meanwhile, within Retail, UK residential real

estate exposures face increased acute physical

events and additional energy remediation costs.

Further detail of these exercises is included in

subsequent sections.

|  |  |
| --- | --- |
|  |  |
| Business | Impacts |
| Barclays International | Medium |
| Retail and SME Banking | Low |
| Head Office | Low |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Climate stress tests |  |
|  |  |  |
|  | Two climate stress tests have been  conducted during 2023, each with their  own short-term scenario, to assess the  Bank's financial resiliency to transition and  physical risks. The H2 exercise builds upon  the learnings from H1, enhancing climate  stress testing design, integration, and  execution as part of the Bank's planning  and stress-testing framework. Key  developments include full macroeconomic  scenario expansion, the broadening of  assessment scope, and the refinement of  climate methodologies. |  |
|  |  |  |

Climate stress test (H1)

In the first half of 2023 Barclays performed a Bank-

wide climate stress test, which tested the impact

of a tipping point event, with subsequent shifts in

consumer behaviour and financial market activity.

The scenario began with a substantial weakening

of the Atlantic Meridional Overturning Circulation,

leading to a disruption in heat transfer and

changes in atmospheric circulation – resulting in

direct physical risk events across the globe.

Structural changes in weather patterns drive

indirect physical risks, and industries reliant on a

stable climate begin to deteriorate. As climate

disasters manifest, societal actors including

governments, markets, consumers and NGOs

take action in attempts to curb further

materialisation of climate risks. This exercise was

used to test the Bank's resilience to credit, market,

operational, liquidity, and reputational risks arising

from climate change. The scenario was developed

internally, based on the latest scientific research

from the IPCC, with review by Oxford University.

Results and insights

Overall, losses represent a c.10% drag on profits,

falling in the range projected in the Bank of

England's CBES. Climate impacts were driven

notably by fossil-fuel-intensive industries and

assets, and those sectors where consumers

'vote with their feet' and change spending

patterns to more sustainable options. While

physical risks losses represented a lower portion

of overall losses across businesses, physical risks

are significant and concentrated in industries

with high reliance on buildings and infrastructure.

Climate internal stress test (H2)

During the second half of 2023 Barclays

undertook a climate stress test, part of an annually

scheduled climate stress-testing programme, in

line with existing internal macroeconomic stress

tests. The formal integration of climate stress-

testing into the Bank's Stress Testing Framework

is an important development and further embeds

ongoing management of climate risks, enables

consistent analysis of how these risks change

through time, and incorporates into assessments

of the Bank's risk appetite. In order to

appropriately assess Barclays' resiliency to

climate-related changes, we assess scenarios

against our internal climate risk register, to select

those most relevant to both self-identified areas

of risk and those that require further exploration.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 132 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Resilience of our strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (c) |

Scenario

The scenario narrative was designed over a five-year

timeframe aligned with the Bank's Medium Term

Planning and Internal Stress Testing scenarios.

Specific variables were expanded using a

combination of models and Subject Matter Expert

(SME) judgement by Barclays' internal Scenario

Expansion Team to assess both physical and

transition Climate Risks. The exercise is designed to

complement conventional Barclays macroeconomic

stress-testing, and seeks to understand:

1)How climate can influence conventional

macroeconomic stressed environment

pathways and severity; and

2)The incremental impact of climate above

macroeconomic stressed pathways.

The climate scenario involves initial policy

announcements that trigger immediate asset

repricing, while more stringent policy

requirements unfold over a longer time horizon –

dampening recovery in the outer years as

depicted in the below chart through stages 1, 2,

and 3. Against this backdrop the scenario also

includes consideration of physical risk, notably

hazards of which Barclays' clients are most

susceptible to such as flood and drought.

Implications and policies of the three stages are

outlined below:

Stage 1:

a) Consumer preferences shift toward greener

products and practices while consumption is cut

to cope with the recessionary environment.

Behavioural shifts are pronounced at sector level

as consumers turn away from firms who finance

carbon-heavy industries.

b) Investors reassess their participation with certain

firms. Those with heavy exposure to brown income

and/or assets, combined with poor transition plans,

are negatively impacted in equity markets – with

capital reallocated to greener firms.

c) In the UK, existing proposals to tighten EPC

minimum standards are accelerated, bringing

forward the compliance date for Buy-to-Let,

Social Housing, and Commercial Real Estate

buildings to be at EPC C or above.

|  |
| --- |
|  |
| Scenario impact (Illustrative only) |

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Number_1.png | A series of risk events lead to a  drastic shift in public sentiment,  demanding a policy response.  Faced with a severe economic  recession, impactful policies are  announced to take effect during  economic recovery. However it  leads to an immediate repricing  of assets. | |  | Number_2.png | Existing government climate  policies come into affect and  contribute to the recovery, as  these policies are largely  investment and funding which  will spur on economic activity. | |  | Number_3.png | More stringent government climate policies - the  expansion of the Emissions Trading Scheme (ETS) and  the rapid introduction of a Carbon Border Adjustment  Mechanism (CBAM) - come into effect. This induces a  carbon price shock and leads to a dampened recovery. |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  | —  Economic Stress Scenario  —  Climate Stress Scenario | |  |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Jump-off | | | Year 1.5 | | |  | Year 2.5 | | |  |  |  |  |
| Stress | | | | Recovery | | | | Dampened recovery | | | | |  |

Stage 2:

a) As the economy moves past peak recession,

large parts of it start to consider how it can build

back greener. Under continued behavioural

pressure from consumers and investors, large-

scale plans for transitioning to a more

sustainable business model occur where

possible.

The return of capital on these plans and the

associated delay to recovery leads to a slight

prolonging of the stress, but the creation of a

transition plan leads to confidence in financial

markets by investors.

b) Additional policies in the UK and US are

accelerated or announced. For example, the

Government will rapidly increase the investment

and deployment of EV charging infrastructure to

support faster transition in the automotive

sector.

Stage 3:

a) The EU and UK governments ramp up their

existing emissions trading schemes to achieve

1.5C, with a carbon price shock increasing $150/

tCO2 within 12 months from 2026 and

continuously increasing. This dampens

economic recovery and leads to prolonged

higher inflation as production costs are higher

due to increased energy costs. However, to

some extent, this is offset by both public and

private investment to enable faster transition.

b) Introduction of Carbon Border Adjustment

Mechanisms, resulting in supply-side shocks, a

reduction in exports, and other trading frictions.

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 133 |
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| Resilience of our strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (c) |

|  |
| --- |
|  |
|  |

![Lines.png]()

|  |
| --- |
|  |
| + |
| - |

The scenario will have significant impacts on

Barclays, including:

1) Amplified market shocks: additional to

existing macroeconomic shocks, there will be

further equity and credit shocks for brown

industries and financiers, as a result of

immediate repricing.

2) Amplified credit deterioration: additional

credit risk on brown industries as a result of

lower earnings expectations and refinancing

risks.

3) Increase in frequency of physical risk events:

throughout the time horizon, there is an

increase in the occurrence of physical hazards

such as flood, hurricanes and droughts.

Following the above narrative, scenario variables

are provided with varying levels of granularity. For

example, global variables – notably demand in

climate-sensitive sectors such as Energy, Power

and Automotive – national variables – including

unemployment rates, GDP, HPI, CPI,

government legislation on EPC with further

distinction between commercial and residential

real estate – and property level variables,

including subsidence and flood. Calibration is

guided by the narrative with consideration for

compounding effects of existing economic

downturn and climate stresses, informing the

shape and magnitude of variable calibration over

the scenario horizon.

Material technological development has not

been assumed within the economic projections,

given the immediate and short time horizon of

the scenario. Variables are leveraged to assess

impacts on Credit Risk, Market Risk,

Counterparty Credit Risk, Underwriting, Non-

traded Market Risk, Income and Balance Sheet,

Expenses, Pension, Liquidity, and Capital across

Barclays – with a focus on UK, US, and EU regions.

Results and insights

Overall, losses are comparable with those seen in

H1, also representing a c.10% drag on profits.

While losses are significant, they remain

manageable within the Bank's existing risk profile.

Within Barclays International, losses were driven

mostly by companies operating in heavily

emission-intensive industries due to rising carbon

prices over the scenario, or those within sectors

where demand for products and services rapidly

fall due to consumer behaviour shifts or wider

decarbonisation of the economy. In addition,

market pressures and government policies on

low-energy-efficiency Commercial Real Estate

leads to deterioration in these markets both in the

UK and US.

In addition, rising unemployment rates across

Barclays' major operating geographies cause

negative impacts on consumer affordability

through the loss of jobs and a weakened

macroeconomic environment. Nevertheless,

Barclays remains resilient to these additional

losses, and current risk management mitigates

these macroeconomic drivers.

Retail and SME segment is impacted by higher

frequency of acute events with real estate and

agricultural assets susceptible to physical risks

such as drought and flood. Despite this, the

portfolios remain resilient due to availability of

household insurance and the strong loan-to-

value profile of the lending. Sensitivity analysis was

conducted to severely constrained household

insurance availability, with Barclays remaining

resilient, albeit noting small populations would be

impacted significantly.

We will continue to refine and adapt our insurance

assumptions to reflect ongoing changes in

market expectations. In addition, while transition

policies on emissions reduction and energy

efficiency improvements do yield greater impacts,

especially as customers begin to price energy

performance more explicitly in their decisions, the

resultant drag on annual profits remains

manageable.

We acknowledge, however, that further advances

in modelling capability and data availability are

needed to fully understand the extent of these

losses, given high uncertainty in climate scenario

analysis. For example, the scenario does not

capture compounding and interaction effects

between physical and transition risks that could

potentially amplify such loss.

As such, Barclays' annual climate stress-testing

cycle is in place to address these uncertainties, by

testing our business resilience under different

climate scenarios and continuously refining our

climate methodologies.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 Enhancements and beyond |  |
|  |  |  |
|  | During 2023 Barclays made several key  enhancements across climate scenario  development, climate risk modelling, and  the ways we embed climate learnings into  our risk management. |  |
|  |  |  |

• Climate scenarios are designed and developed

with our internal specialist scenario expansion

team, leveraging the tools and approaches of

the existing scenario expansion processes and

supplementing these with specific climate

analysis. This ensures consistency in climate

scenario design alongside existing regulatory

internal scenarios, as well as detailed and

granular climate scenario expansion.

• Climate risk models are developed according

to Barclays' Climate Credit Risk Adjustment

Framework, such that model execution across

our suite of climate models follows a

consistent process – adhering to defined

principles and integrated strategically with our

existing model suite whilst still having the

flexibility to include portfolio-specific

constraints and characteristics. Although for

stress-testing purposes Barclays' focus

remains on five-year scenarios aligned with

our usual planning horizon, models in

development are designed to enable

assessment of longer horizons – 10 years or

longer – should we decide to explore these in

the future.

Climate Credit Risk Adjustment Framework

Further design and piloting of Barclays' climate

risk model methodology is underway, focusing on

integrating new climate modelling techniques

into the Bank's existing financial analysis

processes. The target state is a flexible and

adaptable process that can support various

modelling techniques and allow us to test a wide

range of possible future scenarios. Estimates of

incremental credit risk spreads will be integrated

with Capital, Impairment and Stress Testing

Models to quantify climate risk.

Residential Real Estate

We have continued to improve our

understanding of how physical and transition

risks could impact our Mortgages portfolio in the

UK, reflecting on learnings in previous scenario

analysis exercises such as the Bank of England's

Climate Biennial Exploratory Scenario, engaging

with specialist data providers, and undertaking

quantitative analysis of the impacts of

climate risks.

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 134 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Resilience of our strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (c) |

|  |
| --- |
|  |
|  |

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  | Climate scenario | |  |  | Property data | |  |  | Customer data | | |  |
|  | BARCLAYS_AR2023_SR_CHART (2).png | | | | | | | | | | | | | | | |  |
|  | Insurance | | |  |  | Flood | |  |  | Subsidence | |  |  | EPC upgrade | | |  |
|  | corner.png | | | | | BARCLAYS_AR2023_SR_CHART (2)2.png | | | | | | | | | | |  |
|  | Additional costs | |  |  |  |  |  |  | Value shock | | |  |
|  |  |  |  |  |  |  | | | | | | | | | | |  |
|  |  |  |  |  |  | Loan to Income | |  |  |  |  |  |  | Loan to Value | | |  |
|  |  |  |  |  |  |  | | | | | | | | | | |  |
|  |  |  |  |  |  | PD spread | |  |  |  |  |  |  | LGD spread | | |  |
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| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| n | Modelled | n | Input data | n | Feeders/Scenarios |

The focus of physical risk analysis has been on

understanding the impacts of flood and

subsidence, and considering these at a property-

specific level – including the interaction of these

risks and insurance provision, and how impacts

may lead to changes in property values and our

customers' affordability.

For transition risks, the potential costs from

energy remediation action taken by customers

are considered – such as upgrading their

properties' EPC rating in favour of more energy

efficient homes in consideration of energy costs

and accounting for changes in property valuation

across the market.

The uncertainty around the regulatory landscape

for these risks is high, and Barclays continues to

try and improve its understanding of how EPC

regulation could feed through to customer

impacts. The schematic below outlines the

Climate Mortgage model.

|  |
| --- |
|  |
|  |

The impact of climate physical and transition

drivers at a customer level are assessed, yielding

probability of default (PD) and loss given default

(LGD) spreads that are fed downstream into our

existing stress-testing models.

The Residential Real Estate Model will act as a

pilot implementation for the Climate Credit Risk

Adjustment Framework. Over time, we intend to

incorporate additional climate risk drivers such as

coastal flooding and storm damage, and refine

modelling of customer behaviour in this market

as the evidence on how customers respond to

climate-related risks becomes apparent.

Corporates

The Barclays Corporate Transition Forecast

Model was first published in 2021. We will be

doing further work during 2024 to update and

enhance this model. Enhancements will include

improving geographical granularity by leveraging

asset-level data, incorporating sub-sector

specific drivers, considering interaction of

physical and transition risks as one, and

addressing the known enhancements as

published in 2021.

|  |  |
| --- | --- |
|  |  |
| + | Further details on The Barclays Corporate Transition  Forecast can be found at: home.barclays/content/dam/  home-barclays/documents/citizenship/ESG/2021/Corporate-  Transition-Forecast-Model-2021.pdf |
|  |

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| --- | --- | --- |
|  |  |  |
|  | Challenges and limitations |  |
|  |  |  |
|  | Having undertaken a number of climate  scenario analysis exercises, Barclays has  gained a greater understanding of the  challenges and nuances of climate  modelling and continues to develop new  and enhance existing tools for scenario  analysis and stress-testing. |  |
|  |  |  |

Data

There exist inherent challenges in climate

modelling due to limitations in data quality and

availability, given the short history of climate

assessments within the financial services industry.

• Data coverage is often lacking, where a subset

of assets may not have the appropriate

information publicly disclosed. Climate

scenario risk analysis requires approaches and

tools that are more granular (e.g. focus on

company-level analysis), which differs from

more traditional stress-testing exercises

conducted at portfolio or sector level. This

creates a need for more granular data that

Barclays may not typically have maintained

• While high data granularity is desirable to model

client specific features, the balances between

high data granularity and the additional insights

provided must be investigated to assess the

appropriate level of modelling

• Data coherence issues may present

inconsistencies in modelling. Emissions data is

often one-year lagged, thus where the latest

quarter/year financials are available, the

emissions data may not be reflective of the

company's operations, especially where there

has been substantial growth or decline,

mergers and acquisitions or other special

activities.

Scenario

There exist inherent uncertainties with scenario

design largely attributed to limited history of the

interactions between climate risks and the

economy.

• Timing and interactions of physical and

transition risks can greatly impact the Bank's

assessment of capital adequacy and resilience.

Assumptions around such compounding

effects, while nuanced, are critical to our loss

assessment and subsequently risk

management processes and business

strategy

• There is a significant level of uncertainty with

climate stress-testing projections in (i) how

the scenario will manifest; (ii) how customers

and clients will react; and (iii) the final loss

quantification

• An understanding of compounding risks and

feedback loops between financial systems, the

economy, and climate risks remains a

challenge, given the lack of historical

precedent of such interactions. Over longer

time horizons, it becomes increasingly difficult

to capture the range of second-order effects

as physical and transition risks evolve, assess

the rate in which risks manifest or subside, or

identify inflection points.

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 135 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Resilience of our strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (c) |

|  |
| --- |
|  |
|  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Macro-dependencies and objectives |  |
|  | We consider the following areas to  represent some of the macro-  dependencies that may impact our clients,  customers and suppliers, and thus our  ability to deliver our Climate Strategy. |  |
|  |  |  |

• Enhancing policy clarity in the real economy:

Comprehensive, economy-wide

decarbonisation policies are required across

sectors and regions. The absence of clearly

defined milestones for full decarbonisation at a

national level introduces ambiguity over the

channelling of financial resources to ensure an

orderly and just transition

• Optimising carbon-pricing mechanisms:

A comprehensive carbon-pricing scheme is

a key lever to address the current market

failure of externalities from GHGs emissions.

The UK and EU announcements for a carbon

border adjustment mechanism (CBAM) will go

some way to addressing this dependency.

However, IMF research¹ shows prices (avg $6/

tCO2) are currently insufficient to achieve

1.5°C or 2°C targets

Note:

1 imf.org/en/Blogs/Articles/2022/07/21/blog-more-countries-

are-pricing-carbon-but-emissions-are-still-too-cheap

• Enhancing attractiveness of technological

innovations for lenders: A key commercial

constraint on the scalability of climate

technologies is access to cost-competitive

capital. Improving risk-adjusted returns is

required to incentivise private financial flows

towards nascent technologies and developing

nations – essential to limit global warming to

1.5°C. Blended finance mechanisms have

potential to unlock large quantities of private

investment when both public and philanthropic

funds provide first loss tranches. The

subsequent adjusted risk-return profiles can

make previously high-risk investments

marketable

|  |  |
| --- | --- |
|  |  |
| + | Barclays is committed to scaling climate solutions through  our Sustainable Impact Capital portfolio, with a mandate to  invest up to £500m in global climate tech start-ups by the  end of 2027. For further information see page [117](#i4be61753b7f243b19551b0bfbf3a2a0d_364). |
|  |

• Addressing sector-specific challenges:

Myriad sector-specific challenges persist. This

year a backlog of grid connectivity requests for

new renewable power projects highlighted the

complexity of a transition to net zero. Delays

to approval for low-carbon projects impacts

investor confidence, slowing the transition

|  |  |
| --- | --- |
|  |  |
| + | For more information on sector-specific challenges and  dependencies, see BlueTrackTM sector pages [92](#i4be61753b7f243b19551b0bfbf3a2a0d_16479) to [99](#i8541443843b7407ba0e29372591006e8_86955). |
|  |

• Cultivating consumer confidence and

investment incentives: Increased confidence

in the multi-faceted and potential financial

benefits of decarbonisation among society

would help spur action. Clear messaging and

incentives for households and businesses to

generate tangible returns on investment in

low-carbon products is critical for driving the

transition towards net zero, particularly in

sectors reliant on consumer behaviour such as

Housing and Agriculture

• Improving access to sustainability-related

risk and impacts data: Accurate assessments

of client data, including Scope 3 emissions, is

needed to enable a data-driven approach

required to mitigate non-financial risks and

plot the path to net zero. The evolving nature

of corporate and financial sector reporting,

and the persistent challenges stemming from

data gaps, can hinder progress towards these

goals

|  |  |
| --- | --- |
|  |  |
| + | Barclays remains engaged in the development of  mechanisms to bridge these gaps, highlighted by our work  with the Transition Plan Taskforce to set out transition plan  disclosure guidance. For further details see page [61](#i76394ec5a9c94eba84518460501a2b5d_1-1-1-1-2512877). |
|  |

• Global harmonisation of regulation:

To date, an increasing number of [countries](https://stacs.io/governments-eye-mandatory-esg-disclosures/#:~:text=At%20present%2C%2029%20countries%20maintain,Hong%20Kong%2C%20and%20the%20Philippines.)

and territories have some degree of

mandatory ESG disclosure. Non-financial

regulatory requirements are necessary for

investors to accurately assess climate-related

risks – however, major jurisdictions risk

hindering the transition through regulatory

fragmentation. As a bank with a global

presence, interoperability of regulatory

frameworks is essential to enable focused

progress towards net zero.

In addition to the risks arising from our clients'

and suppliers' transitions, we are also dependent

on wider market and geopolitical developments

outside our control. For example, progress may

be impacted by geopolitical developments that

result in energy supply pressures or the varying

pathways individual companies take to transition.

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|  |  |  |  |  |  |  |  |  |  |  |
| Resilience of our strategy (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| TCFD Strategy Recommendation (c) |

|  |
| --- |
|  |
|  |

Information provided in climate and

sustainability disclosures

What is important to our investors and

stakeholders evolves over time, and we aim to

anticipate and respond to these changes.

Disclosure expectations in relation to climate

change and sustainability matters are particularly

fast moving, and differ from more traditional

areas of reporting including in relation to the level

of detail and forward-looking nature of the

information involved and the consideration of

impacts on the environment and other persons.

We have adapted our approach in relation to the

disclosure of such matters. Our climate and

sustainability disclosures take into account the

wider context relevant to these topics, which

may include evolving stakeholder views, the

development of our climate strategy, longer

timeframes for assessing potential risks and

impacts, international long-term climate- and

nature-based policy goals and evolving

sustainability-related policy frameworks. Our

climate and sustainability disclosures are subject

to more uncertainty than disclosures relating to

other subjects, given market challenges in

relation to data reliability, consistency and

timeliness – the use of estimates, judgements

and assumptions which are likely to change over

time, the application and development of data,

models, scenarios and methodologies, the

change in regulatory landscape, and variations in

reporting standards.

These factors mean disclosures may be

amended, updated, and recalculated in future as

market practice and data quality and availability

develops, and could cause actual achievements,

results, performance or other future events or

conditions to differ, in some cases materially,

from those stated, implied and/or reflected in

any forward-looking statements or metrics

included in our climate and sustainability

disclosures. We give no assurance as to the

likelihood of the achievement or reasonableness

of any projections, estimates, forecasts, targets,

commitments, ambitions, prospects or returns

contained in our climate and sustainability

disclosures and make no commitment to revise

or update any such disclosures to reflect events

or circumstances occurring or existing after the

date of such statements.

Disclaimers

In preparing the climate and sustainability

content within the Barclays PLC Annual Report

wherever it appears, we have:

• Made certain key judgements, estimations and

assumptions. This is, for example, the case in

relation to financed emissions, portfolio

alignment, classification of environmental and

social financing, operational emissions and

sustainability metrics, measurement of climate

risk and scenario analysis

• Used climate and sustainability data, models,

scenarios and methodologies we consider to

be appropriate and suitable for these purposes

as at the date on which they were deployed.

This includes data, models, scenarios and

methodologies made available by third parties

(over which we have no control) and which may

have been prepared using a range of different

methodologies, or where the basis of

preparation may not be known to us.

Methodologies, interpretations or

assumptions may not be capable of being

independently verified and may therefore be

inaccurate. Climate and sustainability data,

models, scenarios and methodologies are

subject to future risks and uncertainties and

may change over time. Climate and

sustainability disclosures in this document,

including climate and sustainability-related

data, models and methodologies, are not of

the same standard as those available in the

context of other financial information and use

a greater number and level of judgements,

assumptions and estimates, including with

respect to the classification of climate and

sustainable financing activities. Climate and

sustainability disclosures are also not subject

to the same or equivalent disclosure

standards, historical reference points,

benchmarks or globally accepted accounting

principles. Historical data cannot be relied on

as a strong indicator of future trajectories in

the case of climate change and its evolution.

Outputs of models, processed data, scenario

analysis and the application of methodologies

will also be affected by underlying data quality,

which can be hard to assess, or challenges in

accessing data on a timely basis

• Continued (and will continue) to review and

develop our approach to data, models,

scenarios and methodologies in line with

market principles and standards as this subject

area matures. The data, models, scenarios and

methodologies used (including those made

available by third parties) and the judgements,

estimates and/or assumptions made in them

or by us are rapidly evolving, and this may

directly or indirectly affect the metrics, data

points, targets, convergence points and

milestones contained in the climate and

sustainability content within the Annual

Report. Further, changes in external factors

which are outside of our control such as

accounting and/or reporting standards,

improvements in data quality, data availability,

or updates to methodologies and models and/

or updates or restatements of data by third

parties, could impact – potentially materially –

the performance metrics, data points, targets,

convergence points and milestones contained

in the climate and sustainability content within

the Annual Report. In future reports we may

present some or all of the information for this

reporting period (including information made

available by third parties) using updated or

more granular data or improved models,

scenarios methodologies, market practices or

standards. Equally, we may need to re-

baseline, restate, revise, recalculate or

recalibrate performance against targets,

convergence points or milestones on the basis

of such updated data.

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| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 137 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Important information/Disclaimers | | | | | | | | | | |

Such updated information may result in

different outcomes than those included in the

Annual Report. It is important for readers and

users of the Annual Report to be aware that

direct, like-for-like comparisons of each piece

of information disclosed may not always be

possible from one reporting period to another.

The “Implementing our climate strategy”

section of the Annual Report highlights where

information in respect of a previous reporting

period has been updated. Our principles-

based approach to reporting financed

emissions data (see page 84) sets out when

financed emissions information in respect of a

prior year will be identified and explained

• Included in the Annual Report a number of

graphics, infographics, text boxes and

illustrative case studies and credentials which

aim to give a high-level overview of certain

elements of the climate and sustainability

content within the Annual Report and improve

accessibility for readers. These graphics,

infographics, text boxes and illustrative case

studies and credentials are designed to be

read within the context of the Annual Report

as a whole.

KPMG LLP has performed limited independent

assurance over selected climate and

sustainability content, which has been marked

with the symbol Δ. The assurance engagement

was planned and performed in accordance with

the International Standard on Assurance

Engagements (UK) 3000 Assurance

Engagements Other Than Audits or Reviews of

Historical Financial Information and the

International Standard on Assurance

Engagements 3410 Assurance of Greenhouse

Gas Statements. A limited assurance opinion was

issued and is available at the website link below.

This includes details of the scope, reporting

criteria, respective responsibilities, work

performed, limitations and conclusion. No other

information in the Annual Report has been

subject to this external limited assurance.

There are a variety of internal and external

factors which may impact our reported metrics

and progress against our targets, convergence

points and milestones.

|  |  |
| --- | --- |
|  |  |
| + | The limited assurance opinion is available at:  [home.barclays/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)  [sustainability/esg-resource-hub/reporting-and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/) |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 138 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Important information / Disclaimers (continued) | | | | | | | | | | |

This document contains certain forward-looking

statements within the meaning of Section 21E

of the US Securities Exchange Act of 1934,

as amended, and Section 27A of the US

Securities Act of 1933, as amended, with respect

to the Group. Barclays cautions readers that

no forward-looking statement is a guarantee

of future performance, and that actual results

or other financial condition or performance

measures could differ materially from those

contained in the forward-looking statements.

Forward-looking statements can be identified by

the fact they do not relate only to historical or

current facts. Forward-looking statements

sometimes use words such as ‘may’, ‘will’, ‘seek’,

‘continue’, ‘aim’, ‘anticipate’, ‘target’, ‘projected’,

‘expect’, ‘estimate’, ‘intend’, ‘plan’, ‘goal’, ‘believe’,

‘achieve’ or other words of similar meaning.

Forward-looking statements can be made in

writing but may also be made verbally by

directors, officers and employees of the Group,

including during management presentations,

in connection with this document. Examples

of forward-looking statements include, among

others, statements or guidance regarding or

relating to the Group’s future financial position,

business strategy, income levels, costs, assets

and liabilities, impairment charges, provisions,

capital, leverage and other regulatory ratios,

capital distributions – including policy on

dividends and share buybacks – return on

tangible equity, projected levels of growth in

banking and financial markets, industry trends,

any commitments and targets – including ESG

commitments and targets – plans and objectives

for future operations, and other statements that

are not historical or current facts. By their nature,

forward-looking statements involve risk and

uncertainty because they relate to future events

and circumstances. Forward-looking statements

speak only as at the date on which they are made.

Forward-looking statements may be affected by

a number of factors, including, without limitation:

changes in legislation; regulations, governmental

and regulatory policies, expectations and actions,

voluntary codes of practices, and the

interpretation thereof; changes in International

Financial Reporting Standards and other

accounting standards, including practices with

regard to the interpretation and application

thereof and emerging and developing ESG

reporting standards; the outcome of current and

future legal proceedings and regulatory

investigations; the Group’s ability along with

governments and other stakeholders to

measure, manage and mitigate the impacts of

climate change effectively; environmental, social

and geopolitical risks and incidents, pandemics

and similar events beyond the Group’s control;

the impact of competition in the banking and

financial services industry; capital, liquidity,

leverage and other regulatory rules and

requirements applicable to past, current and

future periods; UK, US, Eurozone and global

macroeconomic and business conditions,

including inflation; volatility in credit and capital

markets; market-related risks such as changes in

interest rates and foreign exchange rates;

reforms to benchmark interest rates and indices;

higher or lower asset valuations; changes in

credit ratings of any entity within the Group or

any securities issued by it; changes in

counterparty risk; changes in consumer

behaviour; the direct and indirect consequences

of the conflicts in Ukraine and the Middle East on

European and global macroeconomic conditions,

political stability and financial markets; political

elections; developments in the UK’s relationship

with the European Union (EU); the risk of

cyberattacks, information or security breaches,

technology failures or other operational

disruptions and any subsequent impacts on the

Group’s reputation, business or operations; the

Group’s ability to access funding; and the

success of acquisitions, disposals and other

strategic transactions. A number of these

factors are beyond the Group’s control.

As a result, the Group’s actual financial position,

results, financial and non-financial metrics or

performance measures or its ability to meet

commitments and targets may differ materially

from the statements or guidance set forth in the

Group’s forward-looking statements. In setting

its targets and outlook for the period 2024-2026,

Barclays has made certain assumptions about

the macro-economic environment, including,

without limitation, inflation, interest and

unemployment rates, the different markets and

competitive conditions in which Barclays

operates, and its ability to grow certain

businesses and achieve costs savings and other

structural actions. Additional risks and factors

that may impact the Group’s future financial

condition and performance are identified in the

description of material existing and emerging

risks beginning on page [258](#i4be61753b7f243b19551b0bfbf3a2a0d_610) of this

Annual Report.

Subject to Barclays PLC’s obligations under the

applicable laws and regulations of any relevant

jurisdiction – including, without limitation, the

UK and the US – in relation to disclosure and

ongoing information, we undertake no obligation

to update publicly or revise any forward-looking

statements, whether as a result of new

information, future events or otherwise.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information |  | Climate and  sustainability report | Governance | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 139 |
|  |
|  |  |  |  |  |  |  |  |  |  |  |
| Forward-looking statements | | | | | | | | | | |

### Creating positive outcomes

### for our stakeholders

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Our  Purpose | | Working together for  a better financial future | | | | | | | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Our  Vision | | The UK-centred leader in global finance  A comprehensive and pre-eminent UK consumer,  corporate, wealth and private banking franchise  The leading non-US based investment bank  A strong, specialist US consumer bank | | | | | | | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Our  Values | | Respect  We harness  the power  of diversity and  inclusion in our  business, trust  those we work  with, and value  everyone’s  contribution. | Integrity  We operate  with honesty,  courage,  transparency  and fairness  in all we do. | |  | Service  We act with  empathy and  humility,  putting the people  and businesses  we serve at  the centre of  what we do. | | Excellence  We set high  standards  for what we do,  championing  innovation  and using  our energy,  expertise  and resources to  make a positive  difference. | Stewardship  We prize  sustainability,  and are passionate  about leaving  things better  than we  found them. | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Customers and clients | | |  |  |  | Colleagues |  |  |  |  |
|  |  | BAR_NVI_S_270_P.jpg | | |  |  |  | BAR_NVI_S_161_P.jpg | | |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Society |  |  |  |  |  | Investors |  |  |  |  |
|  |  | BAR_NVI_S_204_P.jpg | | |  |  |  | BAR_NVI_S_022_P.jpg | | |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 141 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  | | | | | | | | | | |

Parts 1, 2 and 3 of Barclays PLC 2023 Annual Report

together comprise Barclays PLC’s annual accounts and report

for the purposes of Section 423 of the Companies Act 2006.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Inside Part 1 | |  |
|  |  |  |
| [Strategic report](#i4be61753b7f243b19551b0bfbf3a2a0d_13) | | [1](#i4be61753b7f243b19551b0bfbf3a2a0d_13) |
| Welcome to Barclays | | [1](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686055746) |
| The Group at a glance | | [2](#i4be61753b7f243b19551b0bfbf3a2a0d_63221918607682) |
| Chairman’s introduction | | [4](#i4be61753b7f243b19551b0bfbf3a2a0d_62672162794689) |
| Chief Executive's review | | [7](#i4be61753b7f243b19551b0bfbf3a2a0d_62672162794841) |
| Our business model | | [10](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686056057) |
| Our strategy | | [11](#i4be61753b7f243b19551b0bfbf3a2a0d_10551) |
| The world in which we operate | | [12](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686057137) |
| Our plan and targets | | [13](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061823) |
| Our new divisional structure | | [14](#i4be61753b7f243b19551b0bfbf3a2a0d_50577534898522) |
| 2023 divisional review | | [15](#i4be61753b7f243b19551b0bfbf3a2a0d_10360) |
| About Barclays | | [16](#i4be61753b7f243b19551b0bfbf3a2a0d_10384) |
| Barclays UK | | [17](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686056221) |
| Barclays International: Corporate and Investment Bank | | [19](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686056362) |
| Barclays International: Consumer, Cards and Payments | | [21](#i4be61753b7f243b19551b0bfbf3a2a0d_50577534888647) |
| Our stakeholders | | [23](#i4be61753b7f243b19551b0bfbf3a2a0d_10994) |
| Customers and clients | | [24](#i4be61753b7f243b19551b0bfbf3a2a0d_42880953494305) |
| Colleagues | | [27](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680650) |
| Society | | [30](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680602) |
| Investors | | [34](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680747) |
| Additional disclosure | | [37](#i4be61753b7f243b19551b0bfbf3a2a0d_11664) |
| Section 172(1) statement | | [38](#i4be61753b7f243b19551b0bfbf3a2a0d_17101) |
| Non-financial and sustainability information statement | | [40](#i4be61753b7f243b19551b0bfbf3a2a0d_217) |
| Climate-related financial disclosures summary | | 44 |
| ESG Ratings and Benchmarks | | [49](#i4be61753b7f243b19551b0bfbf3a2a0d_220) |
| ESG-related reporting and disclosures | | [50](#i4be61753b7f243b19551b0bfbf3a2a0d_223) |
| Managing risk | | [51](#i4be61753b7f243b19551b0bfbf3a2a0d_11690) |
| Viability statement | | 54 |
| Shareholder information | | [56](#i4be61753b7f243b19551b0bfbf3a2a0d_232) |
| Important information | | [58](#i4be61753b7f243b19551b0bfbf3a2a0d_238) |
| Inside Part 2 | | |
|  |  |  |
| [Climate and sustainability report](#i4be61753b7f243b19551b0bfbf3a2a0d_244) | | [59](#i4be61753b7f243b19551b0bfbf3a2a0d_244) |
| Introduction | | [60](#i4be61753b7f243b19551b0bfbf3a2a0d_17257) |
| [Risks and opportunities](#i4be61753b7f243b19551b0bfbf3a2a0d_250) | | [66](#i4be61753b7f243b19551b0bfbf3a2a0d_250) |
| [Implementing our climate strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_259) | | [72](#i4be61753b7f243b19551b0bfbf3a2a0d_259) |
| [Resilience of our strategy](#i4be61753b7f243b19551b0bfbf3a2a0d_406) | | [130](#i4be61753b7f243b19551b0bfbf3a2a0d_406) |
|  |  |  |
| Please note that throughout the document, graphical representation  of component parts may not cast due to rounding | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Inside Part 3 | | |
|  |  |  |
| [Governance](#i4be61753b7f243b19551b0bfbf3a2a0d_442) | | [143](#i4be61753b7f243b19551b0bfbf3a2a0d_442) |
| [Governance contents](#i4be61753b7f243b19551b0bfbf3a2a0d_445) | | [143](#i4be61753b7f243b19551b0bfbf3a2a0d_442) |
| [Board Governance](#i4be61753b7f243b19551b0bfbf3a2a0d_448) | | [144](#i4be61753b7f243b19551b0bfbf3a2a0d_448) |
| [Directors’ report](#i4be61753b7f243b19551b0bfbf3a2a0d_451) | | [145](#i4be61753b7f243b19551b0bfbf3a2a0d_451) |
| [Remuneration report](#i4be61753b7f243b19551b0bfbf3a2a0d_520) | | [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) |
| [Other Governance](#i4be61753b7f243b19551b0bfbf3a2a0d_550) | | [230](#i4be61753b7f243b19551b0bfbf3a2a0d_550) |
| [Risk review](#i4be61753b7f243b19551b0bfbf3a2a0d_580) | | [254](#i4be61753b7f243b19551b0bfbf3a2a0d_580) |
| [Risk review contents](#i4be61753b7f243b19551b0bfbf3a2a0d_583) | | [254](#i4be61753b7f243b19551b0bfbf3a2a0d_580) |
| [Risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_799) | | [256](#i4be61753b7f243b19551b0bfbf3a2a0d_589) |
| [Material existing and emerging risks](#i4be61753b7f243b19551b0bfbf3a2a0d_613) | | [258](#i4be61753b7f243b19551b0bfbf3a2a0d_610) |
| [Principal risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_655) | | [272](#i4be61753b7f243b19551b0bfbf3a2a0d_655) |
| [Risk performance](#i4be61753b7f243b19551b0bfbf3a2a0d_694) | | [284](#i4be61753b7f243b19551b0bfbf3a2a0d_694) |
| [Supervision and regulation](#i4be61753b7f243b19551b0bfbf3a2a0d_802) | | [363](#i4be61753b7f243b19551b0bfbf3a2a0d_802) |
| [Financial review](#i4be61753b7f243b19551b0bfbf3a2a0d_805) | | [373](#i4be61753b7f243b19551b0bfbf3a2a0d_805) |
| [Financial review contents](#i4be61753b7f243b19551b0bfbf3a2a0d_805) | | [373](#i4be61753b7f243b19551b0bfbf3a2a0d_805) |
| Key performance indicators | | [374](#i4be61753b7f243b19551b0bfbf3a2a0d_808) |
| [Consolidated summary income statement](#i4be61753b7f243b19551b0bfbf3a2a0d_811) | | [376](#i4be61753b7f243b19551b0bfbf3a2a0d_811) |
| [Income statement commentary](#i4be61753b7f243b19551b0bfbf3a2a0d_814) | | [377](#i4be61753b7f243b19551b0bfbf3a2a0d_814) |
| [Consolidated summary balance sheet](#i4be61753b7f243b19551b0bfbf3a2a0d_823) | | [378](#i4be61753b7f243b19551b0bfbf3a2a0d_823) |
| [Balance sheet commentary](#i4be61753b7f243b19551b0bfbf3a2a0d_826) | | [379](#i4be61753b7f243b19551b0bfbf3a2a0d_826) |
| [Analysis of results by business](#i4be61753b7f243b19551b0bfbf3a2a0d_832) | | [380](#i4be61753b7f243b19551b0bfbf3a2a0d_832) |
| [Non-IFRS performance measures](#i4be61753b7f243b19551b0bfbf3a2a0d_853) | | [387](#i4be61753b7f243b19551b0bfbf3a2a0d_853) |
| [Financial statements](#i4be61753b7f243b19551b0bfbf3a2a0d_862) | | [394](#i4be61753b7f243b19551b0bfbf3a2a0d_862) |
| [Financial statements contents](#i4be61753b7f243b19551b0bfbf3a2a0d_862) | | [394](#i4be61753b7f243b19551b0bfbf3a2a0d_862) |
| [Consolidated financial statements](#i4be61753b7f243b19551b0bfbf3a2a0d_877) | | [413](#i4be61753b7f243b19551b0bfbf3a2a0d_880) |
| [Notes to the financial statements](#i4be61753b7f243b19551b0bfbf3a2a0d_910) | | [421](#i4be61753b7f243b19551b0bfbf3a2a0d_913) |
|  | | |
|  | | |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 142 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Contents | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  |  | |  |  | |  |  |  |
|  |  | |  |  |  |  |
|  | Governance | | | | | |  |  |
|  | Our governance framework facilitates  the effective management of the Group  across its diverse businesses. | | | | | |  |  |
|  |  | |  |  | |  |  |  |
|  | Board Governance | |  | Other Governance |  |  |
|  | Directors’ report | |  | [Climate and sustainability governance](#i4be61753b7f243b19551b0bfbf3a2a0d_553) | [231](#i4be61753b7f243b19551b0bfbf3a2a0d_553) |  |
|  | [Board of Directors](#i4be61753b7f243b19551b0bfbf3a2a0d_451) | | [145](#i4be61753b7f243b19551b0bfbf3a2a0d_451) | [Managing impacts in lending and financing](#i4be61753b7f243b19551b0bfbf3a2a0d_559) | [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559) |  |
|  | Group Executive Committee | | [149](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686057926) | Our supply chain | [238](#i4be61753b7f243b19551b0bfbf3a2a0d_172) |  |
|  | Our g overnance  f ramework | | [150](#i4be61753b7f243b19551b0bfbf3a2a0d_12686) | Human rights/Modern slavery | [239](#i4be61753b7f243b19551b0bfbf3a2a0d_9166) |  |
|  | Key Board a ctivities | | [153](#i4be61753b7f243b19551b0bfbf3a2a0d_7146825599531) | Supporting our customers | [242](#i4be61753b7f243b19551b0bfbf3a2a0d_124) |  |
|  | Board Nominations Committee report | | [156](#i4be61753b7f243b19551b0bfbf3a2a0d_42880953500748) | [The Barclays Way](#i4be61753b7f243b19551b0bfbf3a2a0d_562) | [245](#i4be61753b7f243b19551b0bfbf3a2a0d_12486) |  |
|  | Board Audit Committee report | | [166](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686054584) | [Whistleblowing](#i4be61753b7f243b19551b0bfbf3a2a0d_565) | [246](#i4be61753b7f243b19551b0bfbf3a2a0d_565) |  |
|  | [Board Risk Committee report](#i4be61753b7f243b19551b0bfbf3a2a0d_487) | | [174](#i4be61753b7f243b19551b0bfbf3a2a0d_487) | [Tax](#i4be61753b7f243b19551b0bfbf3a2a0d_568) | [247](#i4be61753b7f243b19551b0bfbf3a2a0d_568) |  |
|  | Board Sustainability Committee r eport | | [180](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686051773) | [Financial crime](#i4be61753b7f243b19551b0bfbf3a2a0d_571) | [249](#i4be61753b7f243b19551b0bfbf3a2a0d_571) |  |
|  | [How we comply](#i4be61753b7f243b19551b0bfbf3a2a0d_493) | | [183](#i4be61753b7f243b19551b0bfbf3a2a0d_493) | [Health and safety](#i4be61753b7f243b19551b0bfbf3a2a0d_574) | [250](#i4be61753b7f243b19551b0bfbf3a2a0d_574) |  |
|  | [Other statutory and regulatory information](#i4be61753b7f243b19551b0bfbf3a2a0d_508) | | [185](#i4be61753b7f243b19551b0bfbf3a2a0d_508) | [Managing data privacy, security and resilience](#i4be61753b7f243b19551b0bfbf3a2a0d_577) | [251](#i4be61753b7f243b19551b0bfbf3a2a0d_577) |  |
|  | [Remuneration report](#i4be61753b7f243b19551b0bfbf3a2a0d_520) | | [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) |  |  |  |
|  |  | |  |  |  |  |

### Board Governance

Welcome to our 2023 Board Governance report. The report sets out  the

#### composition of our Board and explains how

#### our Board governance f

#### ramework

#### operates, alongside the key areas of focus of our Board and Board

#### Committees in 2023.

Aim of our governance

The primary aim of our governance is that it:

• seeks to ensure that our decision-making is aligned to our

Purpose, Values and Mindset

• creates long-term sustainable value for our shareholders,

having regard to the interests of all our stakeholders

• is effective in providing constructive challenge, advice and

support to management

• provides checks and balances and drives informed,

collaborative and accountable decision-making.

Compliance with the Code

• Our Board Governance report reflects the requirements of the

2018 UK Corporate Governance Code (the Code).

• To view how we comply with the Code,

please see pages [183](#i4be61753b7f243b19551b0bfbf3a2a0d_493) to [184](#i7473e870055a49b092c1366c6fcaa851_1-5-1-3-1841111).

Certain additional information, signposted throughout this report,

is available at [home.barclays/corporategovernance](https://home.barclays/who-we-are/our-governance/)

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| --- | --- |
|  |  |
| Directors’ report |  |
| [Board of Directors](#i4be61753b7f243b19551b0bfbf3a2a0d_451) | [145](#i4be61753b7f243b19551b0bfbf3a2a0d_451) |
| Group Executive Committee | [149](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686057926) |
| Our governance framework | [150](#i4be61753b7f243b19551b0bfbf3a2a0d_12686) |
| Key Board activities | [153](#i4be61753b7f243b19551b0bfbf3a2a0d_7146825599531) |
| Board Nominations Committee report | [156](#i4be61753b7f243b19551b0bfbf3a2a0d_42880953500748) |
| Board Audit Committee report | [166](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686054584) |
| [Board Risk Committee report](#i4be61753b7f243b19551b0bfbf3a2a0d_487) | [174](#i4be61753b7f243b19551b0bfbf3a2a0d_487) |
| Board Sustainability Committee report | [180](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686051773) |
| [How we comply](#i4be61753b7f243b19551b0bfbf3a2a0d_493) | [183](#i4be61753b7f243b19551b0bfbf3a2a0d_493) |
| [Other statutory and regulatory information](#i4be61753b7f243b19551b0bfbf3a2a0d_508) | [185](#i4be61753b7f243b19551b0bfbf3a2a0d_508) |
| [Remuneration report](#i4be61753b7f243b19551b0bfbf3a2a0d_520) | [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) |

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 144 |
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| Leading the Group, driven by  our Purpose, Values and Mindset |

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|  | Audit Committee  member |  | Nominations  Committee member |  | Remuneration  Committee member |  | Risk Committee  member |  | Sustainability  Committee member | Governance report icons3.png | Committee  Chair |

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|  | Nigel Higgins  Group Chairman | |  | Skills, experience and contribution:  • seasoned business leader with extensive  experience in, and understanding of,  banking and the financial services industry  • strong track record in leading and chairing  organisations  • significant experience in providing  strategic advice to major international  organisations and governments  • keenly focused on culture and corporate  governance. |  | Nigel spent 36 years at Rothschild & Co.  where he was most recently Deputy  Chairman. Prior to that he was Chairman of  the Group Executive Committee and  Managing Partner of Rothschild & Co.  Key current appointments:  Chairman, Sadler’s Wells; Non-Executive  Director, Tetra Laval Group |  |
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|  | C.S. Venkatakrishnan  Group Chief Executive | |  | Skills, experience and contribution:  • highly regarded leader with significant  global banking experience  • extensive background in financial markets  and risk management  • deep understanding of the business and  the areas within which the Group  operates.  Prior to his appointment as Group Chief  Executive, Venkat served as Head of Global  Markets and Co-President of Barclays Bank  PLC from October 2020 and Group Chief  Risk Officer from 2016 to 2020. |  | Before joining Barclays in 2016, Venkat  worked at JPMorgan Chase from 1994,  holding senior roles in Asset Management,  Investment Banking, and in Risk.  Key current appointments:  Board Member, Institute of International  Finance; Advisory member to the Board,  Massachusetts Institute of Technology  Golub Centre for Finance and Policy;  Member of the UN Environment Programme  Finance Initiative Leadership Council; Chair,  Corporate Partnerships Board, The Royal  Marsden Cancer Charity; Member, CNBC  ESG Council |  |
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|  | Appointed:  November 2021 | |  |  |  |
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|  | Brian Gilvary  Senior Independent Director (SID) | |  | Skills, experience and contribution:  • extensive senior level experience of  management, finance and strategy  • deep experience of US and UK  shareholder engagement  • significant experience with, and  understanding of, the challenges and  opportunities inherent in advancing a  sustainable energy future.  Brian spent much of his career with BP p.l.c.  in senior leadership roles, where he was most  recently Chief Financial Officer. |  | His other senior-level experience includes  serving on the boards of various commercial  and charitable organisations. Brian was Chair  of The 100 Group of FTSE 100 Finance  Directors, a member of the UK Treasury  Financial Management Review Board and has  served on various Business in the  Community Leadership Teams.  Key current appointments:  Non-Executive Chair, INEOS Energy, an  INEOS group company; Non-Executive  Director, Defence Board, Ministry of Defence |  |
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|  | Appointed:  February 2020 (Board), January 2021 (SID) | |  |  |  |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 145 |
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| Directors’ report: Board of Directors | | | | | | | | | | |

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|  | Robert Berry  Independent Non-Executive Director | |  | Skills, experience and contribution:  • proven track record of management of  risk exposure for a global financial  institution and building a modern group-  wide risk management organisation  • strong record of integrating risk  management with strategy  • significant experience in finance, model  development and trading. |  | Robert has deep risk management expertise  having had a 28-year career at Goldman  Sachs, where, prior to his retirement in 2018,  he held the role of Co-Deputy Chief Risk  Officer.  Key current appointments:  Trustee, High Watch Recovery Center  (incorporating President, Alina Lodge) |  |
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| Appointed:  February 2022 | |
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|  | Tim Breedon CBE  Independent Non-Executive Director | |  | Skills, experience and contribution:  • significant experience in strategic planning  • extensive financial services experience  • detailed knowledge of risk management  and UK and EU regulation.  Tim is a member of the Board and is also  Chair of Barclays Bank Ireland PLC (also  referred to as Barclays Europe). |  | He had a distinguished career with Legal &  General where, among other roles, he was  the Group Chief Executive Officer until June  2012. Tim also served as Chair of the  Association of British Insurers.  Key current appointments:  Chairman, Apax Global Alpha Limited; Non-  Executive Director, Quilter PLC |  |
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|  | Appointed:  November 2012 | |  |  |  |
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|  | Anna Cross  Group Finance Director | |  | Skills, experience and contribution:  • extensive accounting and financial  services expertise  • deep understanding of banking and retail  sectors  • significant financial leadership experience  of financial institutions.  Anna is a chartered accountant and Group  Finance Director with responsibility for  Finance, including Tax, Treasury, Investor  Relations and Strategy. |  | Prior to joining Barclays, Anna worked in both  banking and retail and held various roles at  Asda, HBOS and Lloyds Banking Group.  Since joining Barclays in 2013, Anna was  appointed Chief Financial Officer of Barclays  Bank UK PLC in 2016, Group Financial  Controller in 2019 and Deputy Group  Finance Director in 2020. She joined the  Group Executive Committee in February  2022, before taking up the role of Group  Finance Director in April 2022.  Key current appointments:  Chair, The 100 Group of the FTSE Finance  Directors |  |
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|  | Appointed:  April 2022 | |  |  |  |
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|  | Mohamed A. El-Erian  Independent Non-Executive Director | |  | Skills, experience and contribution:  • highly respected economist and investor  • extensive experience in the asset  management industry and multilateral  institutions  • deep knowledge and understanding of  international economics and financial  services sector.  Mohamed currently serves as President of  Queens' College, Cambridge University. He is  Chief Economic Advisor at Allianz SE, the  corporate parent of PIMCO (Pacific  Investment Management Company LLC)  where he formerly served as Chief Executive  and Co-Chief Investment Officer. |  | Mohamed is a regular columnist for  Bloomberg Opinion and a contributing editor  at the Financial Times. He spent 15 years at  the IMF where he served as Deputy Director  before moving to the private sector and  financial services.  Key current appointments:  Lead Independent Director, Under Armour  Inc.; Chief Economic Adviser, Allianz SE;  Chairman, Gramercy Funds Management;  Senior Advisor, Investcorp Bank BSC |  |
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|  | Appointed:  January 2020 | |  |  |  |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 146 |
|  | Governance |  |
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| Directors’ report: Board of Directors (continued) | | | | | | | | | | |

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|  | Dawn Fitzpatrick  Independent Non-Executive Director | |  | Skills, experience and contribution:  • extensive management experience of  international financial institutions  • strong financial and strategic leadership  experience  • detailed knowledge of the markets in  which the Group operates.  Dawn holds the role of Chief Executive  Officer and Chief Investment Officer at  Soros Fund Management LLC. |  | Her previous experience includes 25 years  with UBS, most recently as Head of  Investments for UBS Asset Management.  Key current appointments:  Chief Executive Officer and Chief Investment  Officer, Soros Fund Management LLC;  Member, Advisory Board and Investment  Committee of the Open Society  Foundations’ Economic Justice Programme;  Advisory Council Member, The Bretton  Woods Committee; Chair, Financial Sector  Advisory Council, Federal Reserve Bank of  Dallas |  |
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|  | Appointed:  September 2019 | |  |  |  |
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|  | Mary Francis CBE  Independent Non-Executive Director | |  | Skills, experience and contribution:  • extensive board-level experience across a  range of industries  • strong focus on reputation management  and promoting board governance values  • detailed understanding of the interaction  between public and private sectors.  Mary's previous appointments include Non-  Executive Directorships at the Bank of  England, Alliance & Leicester, Aviva, Centrica  and Swiss Re Group. |  | In her executive career, Mary held senior  positions with both HM Treasury and the  Prime Minister's Office and served as  Director General of the Association of British  Insurers.  Key current appointments:  Senior Independent Director, PensionBee  Group PLC; Member, UK Takeover Appeal  Board |  |
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|  | Appointed:  October 2016 | |  |  |  |
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|  | Sir John Kingman  Independent Non-Executive Director | |  | Skills, experience and contribution:  • deep background in financial services  • strong leadership qualities and chair  experience  • extensive expertise providing strategic  advice to Government  John is Chair of Barclays Bank UK PLC. He  had a long Whitehall career, where he was  Second Permanent Secretary to HM  Treasury and was also closely involved in the  UK response to the financial crisis, handling  the resolution of Northern Rock and leading  negotiations with RBS, Lloyds and HBOS on  their £37bn recapitalisation. |  | John was also the first Chief Executive of UK  Financial Investments Ltd (UKFI); and from  2010-2012, he was Global Co-Head of the  Financial Institutions Group at Rothschild.  From 2016-2021 John was the first Chair of  UK Research & Innovations, which oversees  Government science funding of c£8bn a  year. Between 2020 and January 2023, he  was Chair of Tesco Personal Finance plc.  Key current appointments:  Chair, Legal & General Group plc; Trustee &  Deputy Chair of the Board of Trustees, The  National Gallery |  |
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|  | Appointed:  June 2023 | |  |  |  |
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|  | Marc Moses  Independent Non-Executive Director | |  | Skills, experience and contribution:  • strong technical finance background in  accounting and audit-related matters  • significant board and senior executive-  level risk management experience  • extensive knowledge of banking and  financial services.  Marc is a chartered accountant and his  financial services experience extends over  43  years, initially as a trader and then in senior  executive roles as an audit partner at PwC,  and Chief Financial Officer of JPMorgan  Europe. |  | He joined HSBC in 2005 where he was Group  Chief Risk Officer for nine years and joined  the group board as an executive director in  2014. He retired from HSBC in 2019.  Key current appointments:  None |  |
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|  | Appointed:  January 2023 | |  |  |  |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 147 |
|  | Governance |  |
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| Directors’ report: Board of Directors (continued) | | | | | | | | | | |

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|  | Diane Schueneman  Independent Non-Executive Director | |  | Skills, experience and contribution:  • significant experience of managing global,  cross-discipline business operations and  client services in the financial services  industry  • strong transformational programme  experience  • extensive technology and information  security expertise.  Diane is Chair of Barclays Execution Services  Limited and a member of the Board of  Barclays US LLC. |  | Diane was previously Global Chief  Infrastructure Officer of Merrill Lynch, where  she was responsible for all technology and  operations across retail, corporates and  banking.  Key current appointments:  None |  |
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|  | Appointed:  June 2015 | |  |  |  |
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|  | Julia Wilson  Independent Non-Executive Director | |  | Skills, experience and contribution:  • significant board and executive-level  strategic and financial leadership  experience  • extensive accounting, audit and financial  services expertise  • strong UK regulatory experience.  Julia is a chartered accountant and was the  Group Finance Director of 3i Group plc, having  served on its board from 2008 until she  stepped down in June 2022. Prior to joining 3i  she was Group Director of Corporate Finance  at Cable & Wireless where she also held a  number of finance-related roles. |  | Julia was appointed as a Non-Executive  Director at Legal & General Group plc in  2011. She chaired L&G’s Audit Committee  between 2013 and 2016 and was Senior  Independent Director from 2016 until she  stepped down from L&G in March 2021. Julia  previously served as the Chair of The 100  Group of FTSE 100 Finance Directors.  Key current appointments:  None |  |
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|  | Appointed:  April 2021 | |  |  |  |
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|  | Hannah Ellwood  Group Company Secretary |  |  | Relevant skills and experience:  Hannah is an experienced lawyer and company  secretary with significant experience in  corporate governance, regulatory, disclosure  and market conduct matters.  Career:  Hannah joined Barclays in September 2012 as  Chief of Staff to the Investment Bank General  Counsel. Having moved from the Legal  function to Barclays Corporate Secretariat in  2016, she was subsequently appointed Deputy  Company Secretary of Barclays PLC in 2018. In  February 2023, Hannah was appointed Group  Company Secretary. |  | Prior to joining Barclays, Hannah was a Senior  Associate in the London Corporate practice  of Clifford Chance LLP. |  |
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|  | Appointed:  February 2023 | |  |  |  |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 148 |
|  | Governance |  |
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| Directors’ report: Board of Directors (continued) | | | | | | | | | | |

Leading the delivery of

### Barclays'

### strategy

As the most senior management committee for the Group,

our Group Executive Committee (ExCo) supports the

Group Chief Executive in executing the Group’s strategy.

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|  |  |  |  |  |  |  |  |  |  |  |  | Changes in ExCo during 2023  • Alistair Currie was appointed Group Chief  Operating Officer and Chief Executive of  Barclays Execution Services Limited (BX),  having previously served on ExCo as  Global Head of Consumer Banking and  Payments  • Kirsty Everett joined as Group Chief  Compliance Officer  • Vim Maru joined as Global Head of  Consumer Banking and Payments  We are grateful for the contributions made  by the ExCo members who stepped down  in 2023:  • Mark Ashton-Rigby stepped down as  Group Chief Operating Officer and Chief  Executive of BX  • Matt Fitzwater stepped down as Interim  Group Chief Compliance Officer  Standing attendees  The Group Chief Executive extends invites  to a number of standing attendees to ExCo:  • Craig Bright, Chief Information Officer  • Adeel Khan and Stephen Dainton, Co-  Heads of Global Markets  • Cathal Deasy and Taylor Wright, Co-  Heads of Investment Banking  ExCo meetings are also attended on a  regular basis by the Group Chief Internal  Auditor, Lindsay O’Reilly.  Ex-officio posts  ExCo continues to utilise ex-officio  positions on the Committee to broaden the  scope of perspectives and contributions  made, as well as to provide specialist input.  During 2023, the following attended ExCo  meetings as an ex-officio member, with  each appointee serving for a four-month  rotation:  • Ingrid Hengster, CEO Barclays Germany  and Global Chair, Investment Bank  • Antoinette O'Neill, Chief Information  Officer, Corporate and Investment Bank  (CIB)  • Betty Gee, Americas Head of Equities  Distribution within the CIB |
|  | C.S. Venkatakrishnan  Group Chief Executive |  |  |  | Anna Cross  Group Finance Director |  |  |  | Paul Compton  Global Head of the Corporate  and Investment Bank and  President of BBPLC |  |  |
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|  | Alistair Currie  Group Chief Operating Officer  and Chief Executive, BX |  |  |  | Kirsty Everett  Group Chief Compliance  Officer |  |  |  | Matt Hammerstein  Chief Executive Officer,  Barclays UK |  |  |
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|  | Vim Maru  Global Head of Consumer  Banking and Payments |  |  |  | Tristram Roberts  Group Human  Resources Director |  |  |  | Taalib Shaah  Group Chief Risk Officer |  |  |
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|  | Stephen Shapiro  Group General Counsel |  |  |  | Sasha Wiggins  Group Head of Public Policy  and Corporate Responsibility |  |  |  |  |  |  |
| Stephen Shapiro.jpg | Stephen Shapiro Barclays_Crop.jpg |  |  |  | LynnMargolisPhotography-282_Crop.jpg |  |  |  |  |  |  |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 149 |
|  | Governance |  |
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| Directors’ report: Group Executive Committee | | | | | | | | | | |

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| A Group-wide governance framework  facilitating effective decision-making  Driving long-term sustainable value for our shareholders, with regard to  the interests of our stakeholders. |

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|  | Group structure |  |
|  | Barclays PLC (BPLC) is the Group’s  parent company and has a premium  listing on the London Stock Exchange.  Each of the Group’s key operating  entities - Barclays Bank PLC (BBPLC),  Barclays Bank UK PLC (BBUKPLC),  Barclays Europe, Barclays US LLC and  Barclays Bank Delaware - has its own  board (with Executive and Non-  Executive Directors) and board  committees.  These main operating companies are  supported by our Group-wide service  company, BX, which provides  technology, operations and functional  services to businesses across the  Group. |  |
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|  | Barclays PLC |  |
|  | Arrow_BrightBlue.png |  |
|  | BBPLC |  |
|  | Barclays Europe |  |
|  | Barclays US LLC |  |
|  | Barclays Bank Delaware |  |
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|  | BX |  |
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Our governance framework

The Board recognises that effective

governance is key to the successful

development and execution of the Group’s

strategy. We think of governance as how

the Board makes decisions and provides

oversight to promote Barclays’ success for

the long-term sustainable benefit of our

shareholders, having regard to the

interests of our stakeholders (including our

clients, customers, colleagues and the

society and wider environment in which we

operate).

Our Group-wide governance framework

is constructed to:

• facilitate the effective management of

the Group by our Group Chief Executive

and his ExCo across our

diverse businesses

• support and provide oversight and

constructive challenge of the Group’s

major subsidiary boards in the UK,

Ireland and the US, consistent with the

legal, regulatory and independence

requirements applicable to

those entities.

Generally, there is one set of rules for the

Group. Group-wide frameworks, policies

and standards are adopted throughout the

Group unless local laws or regulations (for

example, the ring-fencing obligations

applicable to BBUKPLC) require otherwise,

or ExCo deems that it would otherwise be

appropriate in a specific instance.

Corporate Governance

Operating Manual

Our Corporate Governance Operating

Manual outlines how the Group’s significant

subsidiaries (and their respective boards

and board committees) should interact

with each other. It also provides guidance

and clarity for management and Directors

as to how these relationships and

processes should work in practice. This is a

dynamic document that evolves with the

changing nature of the Group.

The role of the Board

The BPLC Board sets the Purpose,

strategic direction and risk appetite for the

Group and is the ultimate decision-making

body for matters of Group-wide strategic,

financial, regulatory or reputational

significance.

We partially consolidated and streamlined

the membership of the BPLC and BBPLC

Boards in 2019, to improve efficiency and

co-ordination while reducing complexity

and unnecessary duplication.

As a result, membership of the BBPLC

Board is a subset of the BPLC Board. All

members of the BPLC Board (except the

Senior Independent Director, Chair of

BBUKPLC and at least one other Non-

Executive Director) also serve on the

Board of BBPLC.

We believe that having members of the

BPLC Board serving as the Chairs of some

of the Group’s main subsidiaries supports

improved efficiency, escalation and co-

ordination while ensuring an appropriate

focus is given to matters relevant to each

entity.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 150 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Our governance framework | | | | | | | | | | |

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|  | Board governance framework | | | | | | | | | | | | | | | | | | | | | | | |  |
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|  |  |  | | Barclays PLC Board  Responsible for the overall leadership of the Group  (with direct oversight of matters relating to strategy, reputation and culture) | | | | | | | | | | | | | | | | | |  | |  |  |
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|  |  | Board  Nominations  Committee  Reviews the composition  of the appointments to the  Board, Board Committees  and ExCo. | |  |  |  | Board  Audit  Committee  Reviews financial reports  and monitors the internal  control environment. | |  |  |  | Board  Risk  Committee  Monitors financial,  operational and legal  risk appetite. | |  |  |  | Board  Sustainability  Committee  Oversees climate and  sustainability matters. | |  |  |  | Board  Remuneration  Committee  Sets principles and  parameters of  remuneration policy. | |  |  |
|  |  | + | For more information,  see page  [156](#i4be61753b7f243b19551b0bfbf3a2a0d_42880953500748) . |  |  |  | + | For more information,  see page  [166](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686054584) . |  |  |  | + | For more information,  see page  [174](#i4be61753b7f243b19551b0bfbf3a2a0d_487) . |  |  |  | + | For more information,  see page  [180](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686051773) . |  |  |  | + | For more information,  see page  [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520). |  |  |
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Matters reserved to the Board

Matters reserved solely for the decision-

making power of the Board are set out in

our bespoke Matters Reserved to the Board.

Those matters include material decisions

relating to:

• strategy

• risk appetite

• medium term plans

• capital and liquidity plans

• risk management and controls

frameworks

• approval of financial statements

• approval of large transactions

• approval of share allotments, dividends

and share buybacks.

Responsibility for the Group’s business on

a day-to-day basis has been delegated by

the Board to the Group Chief Executive,

supported by his ExCo, to make and

implement operational decisions.

Information provided to

the Board

The Group Chairman is responsible for

setting the Board’s agenda, primarily

focused on strategy, performance, value

creation, culture, stakeholders and

accountability. The Chairman also ensures

that Board members receive timely and

high-quality information to enable them to

make sound decisions and promote the

success of BPLC.

The Group Company Secretary, working in

collaboration with the Group Chairman, is

responsible for ensuring good governance

and information flow, to support the

Board’s effectiveness. In 2023, we

continued to strive for balanced papers

which clearly identify substantive issues

and key points for the Board’s attention,

continuing the momentum created in

previous years.

The Board is kept informed of key business

developments throughout the year

through regular updates from the

Executive Directors and senior

management, in addition to the

presentations delivered to the Board and

the Board Committees as part of formal

meetings.

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| --- | --- |
|  |  |
| + | Details of key Board activities for 2023 are set  out on pages [153](#i4be61753b7f243b19551b0bfbf3a2a0d_7146825599531) to [155](#i66ff12c94ccf45638f2b03e922fbf213_6-0-1-1-2511538). |
|  |

Directors are able to seek independent

and professional advice at Barclays’

expense, where required, to enable them

to fulfil their obligations to the Board.

Attendance at Board meetings

Directors are expected to attend every

Board meeting. Where a Director is not

able to attend a Board meeting, the

relevant Director’s views are made known

to the Group Chairman in advance of the

meeting. The Chairman also meets

privately, on a regular basis, with each

Non-Executive Director.

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| --- | --- |
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| + | Details of Director attendance at Board  meetings in 2023 are shown  on the next page. |
|  |

Board Committees

The Board is supported in its work by its

Committees - the Board Nominations

Committee, Board Audit Committee,

Board Risk Committee, Board

Remuneration Committee and the Board

Sustainability Committee - each of which

has its own terms of reference clearly

setting out its remit and decision-making

powers. This structure enables the Board

to spend a significant proportion of its time

focusing on the Group’s strategy.

The Board Committees are comprised

solely of Non-Executive Directors, with the

exception of the Board Sustainability

Committee of which the Group Chief

Executive is an Executive member.

The Chairs of each Committee report on

their Committee’s work at every scheduled

Board meeting.

Board effectiveness

The effectiveness of the Board, its

Committees and individual Directors are

assessed on an annual basis. We carried

out an internally facilitated effectiveness

review for 2023, which was led by the SID

and supported by the Group Company

Secretary. In line with the requirements of

the Code, we intend to conduct an

externally-facilitated review of the Board,

Board Committees and individual

Directors in 2024.

|  |  |
| --- | --- |
|  |  |
| + | You can read more about the 2023 effectiveness  review, and progress against recommendations  from the 2022 review, in the Board Nominations  Committee report  on page  [164](#id6f86b9feb8d4bb290582a02d22ac8cc_152440). |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 151 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Our governance framework (continued) | | | | | | | | | | |

Division of responsibilities

Roles on the Board and attendance at Board meetings

In line with the provisions of the Code, a clear division of responsibilities has been established between Executive and Non-Executive

Directors. Our Charter of Expectations sets out the individual role profiles and required behaviours and competencies for the Chair,

Senior Independent Director, Non-Executive Directors, Executive Directors and Committee Chairs.

The table below shows the role profiles for our Board members, along with details of their attendance at Board meetings in 2023. The

aggregate attendance for Board and relevant Board Committee meetings in 2023 did not fall below 75% for any Director.

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| Role on Board | Meetings  attended/  eligible to  attend 1 | Ad hoc  meetings  attended/  eligible to  attend 2 |  | Responsibilities |
| Chair  Nigel Higgins 3 | 7/7 | 1/1 |  | The Chair is responsible for:  • leading the Board and its overall effectiveness in directing the Company  • promoting a culture of openness and inclusion, and facilitating and encouraging open constructive  challenge and debate between all Directors  • ensuring the Board has a clear understanding of shareholder views. |
| Group Chief  Executive  C.S.  Venkatakrishnan | 7/7 | 1/1 |  | The Group Chief Executive, supported by his ExCo, leads the Executive Directors in:  • running the Group’s business on a day-to-day basis and making and implementing operational decisions  • leading Barclays towards the achievement of its strategic objectives and implementing the strategy  decisions taken by the Board  • promoting and demonstrating the appropriate culture, values and behaviours of the boardroom,  including Barclays’ Values and Mindset. |
| Group Finance  Director  Anna Cross | 7/7 | 1/1 |  | The Group Finance Director is responsible for:  • together with the Group Chief Executive, the achievement of financial targets for the Group  • providing strategic and functional leadership of the Finance functions  • managing and responding to feedback on Barclays' business performance from investors, financial  institutions, regulators and auditors. |
| Senior  Independent  Director (SID)  Brian Gilvary | 7/7 | 1/1 |  | The SID is responsible for:  • providing a sounding board for the Chair; serving as a trusted intermediary for the other Directors and  shareholders when necessary  • maintaining contact with major shareholders to understand their issues and concerns, and ensures the  Board is aware of their views  • leading the appraisal of the Chair’s performance, at least annually. |
| Non-Executive  Directors |  |  |  | Non-Executive Directors are responsible for:  • providing effective oversight, strategic guidance and constructive challenge  • helping to develop proposals on strategy and empowering the Executive Directors to implement the  Group’s strategy while scrutinising and holding to account the performance of management and  Executive Directors against agreed performance objectives  • with the support of the Board Nominations Committee, the appointment and removal and succession  planning for Executive Directors.  Notes  Notes:  1 Each Board meeting is held over the course of two days. In the 2022 Annual Report, these were reported as two separate Board  meetings. For the 2023 attendance figures, one Board meeting which was held over two days has been reported as one Board  meeting.  2 The ad hoc meeting was called at short notice.  3 As required by the Code, the Group Chairman was independent on appointment.  4 Sir John Kingman was appointed to the Board with effect from 1 June 2023.  5 Marc Moses was appointed to the Board with effect from 23 January 2023.  6 Julia Wilson was unable to attend due to a prior commitment.  7 Mike Ashley stepped down from the Board with effect from 3 May 2023.  8 Crawford Gillies stepped down from the Board with effect from 31 May 2023. |
| Robert Berry | 7/7 | 1/1 |  |
| Tim Breedon | 7/7 | 1/1 |  |
| Mohamed A. El-Erian | 7/7 | 1/1 |  |
| Dawn Fitzpatrick | 7/7 | 1/1 |  |
| Mary Francis | 7/7 | 1/1 |  |
| Sir John Kingman4 | 5/5 | 1/1 |  |
| Marc Moses5 | 7/7 | 1/1 |  |
| Diane Schueneman | 7/7 | 1/1 |  |
| Julia Wilson | 7/7 | 0/16 |  |
| Former  Directors |  |  |  |
| Mike Ashley7 | 2/2 | 0/0 |  |
| Crawford Gillies8 | 2/2 | 0/0 |  |

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| --- | --- |
|  |  |
| + | You can find a copy of our Charter of Expectations , which sets out the role profiles and required competencies for our Board members , at:  [home.barclays/who-we-are/our-governance/board-responsibilities](https://home.barclays/who-we-are/our-governance/board-responsibilities/) |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 152 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Our governance framework (continued) | | | | | | | | | | |

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| --- |
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| Key Board activities in 2023 |
| Keenly focused on strategy to drive the long-term success of Barclays. |

Throughout 2023, the Board devoted

significant attention to Barclays’ strategy,

working closely with the Group Chief

Executive and his ExCo both to drive

forward the implementation of the Group’s

strategy as set by the Board and to

challenge itself on Barclays' strategic

ambitions.

Against a backdrop of geopolitical

tensions, together with high interest rates

and inflationary pressures, the Board

remained focused on driving sustainable

long-term value for the benefit of all of our

stakeholders. You can read about how the

Board has taken into account stakeholder

interests in our Section 172(1) statement

in the Strategic report from page [38](#i4be61753b7f243b19551b0bfbf3a2a0d_17101).

Within the overarching consideration of

Group strategy matters, the Board

continued to give significant consideration

to our climate and sustainability strategy.

Given the importance of the work to

address the climate challenge, the Board

approved the establishment of the Board

Sustainability Committee in March 2023.

The Board Sustainability Committee

supports the Board's oversight of the

Group's climate strategy and sustainability

agenda, including our ambition to be a net

zero bank by 2050. Please see the Board

Sustainability Committee report on page

[180](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686051773) for further detail.

You can read more about the key areas

of Board focus in 2023 in the rest of

this section.

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|  | Spotlight |  |  |  |  |
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|  | Board engagement with  colleagues  The Board strongly believes in the  importance of engaging with our  stakeholders and hearing their views,  which brings valuable outside  perspectives to the Board. In particular,  the Board recognises that our  colleagues are critical to our success.  Ensuring that Board members have an  opportunity to engage directly with  colleagues is an important part of our  method of workforce engagement and  helps the Board take the issues of  interest to our colleagues into account  in its decision-making. During 2023,  Board engagement with colleagues  included:  • The Group Chairman and Mary  Francis visited our contact centre in  Wavertree, Liverpool, to experience  the Consumer Duty 'in action',  meeting with customer-facing  colleagues and learning about how  Barclays is addressing vulnerable  customer needs.  • The Group Chief Executive and  Group Finance Director hosted  quarterly all-colleague town halls on  Barclays' financial performance. | |  | • Robert Berry and Sir John Kingman  visited Barclays branches in London  where they met colleagues.  • The Group Chief Executive hosted  the Citizenship and Diversity Awards  to celebrate colleagues who have  made a positive impact in their  communities and have helped to  strengthen the diversity, equity and  inclusion (DEI) culture within  Barclays.  • Julia Wilson participated in a  celebration event to congratulate  newly promoted Managing Directors  from across the Group.  • The Group Chairman, along with  other Board members, visited the  new trading floors at our head office  in London, meeting colleagues in the  Markets business and experiencing  the trading floors first-hand.  • Board members spent time with  Barclays UK colleagues based in the  UK and India.  • The Group Finance Director met  colleagues during visits to our New  York, Glasgow and Northampton  Campuses, and hosted other  colleague events including an event  to mark International Women's Day. |  |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 153 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Key Board activities | | | | | | | | | | |

Key focus areas

The following two pages highlight the key

areas of focus for the Board during 2023

and the key stakeholder groups central to

the matters considered and decisions

taken.

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| Stakeholder groups | | | |
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| C&c_Dot.png | Customers and clients | Society_Dot.png | Society |
| Colleagues_Dot.png | Colleagues | Investors-Dot.png | Investors |

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| Strategy, including Climate | | | | | |
| Topic | Board activity |  | Key decisions | | |
| Strategy and  business  review | • Held regular corporate and business strategy discussions  at meetings throughout the year, including a Strategy day  in September.  • Reviewed and discussed the 2023 Medium Term Plan  ahead of its approval by the Board in early 2024.  • Received business and function reviews throughout the  year to understand key risks and opportunities, including  in relation to the Investment Bank, Consumer, Cards and  Payments and Barclays UK.  • Participated in focus sessions on 'horizontal topics' to  deepen the Board's understanding on key areas of  impact/focus across the Group, such as resilience and  cybersecurity, reputation risk, and financial crime. |  | ü Endorsed the announcement in October 2023 as part of  our Q3 Interim results of an Investor Update to be held on  20 February 2024. | | |
|  |  |  |  |  |  |
| Climate and  sustainability | • Received and discussed updates on the Group's climate  and sustainability strategy, including in relation to our  sustainable finance strategy, energy transition and client  transition plans.  • Reviewed climate and sustainability metrics and progress  against targets.  • Received updates on sustainability matters, including  nature, deforestation and biodiversity. |  | ü Approved the establishment of the Board Sustainability  Committee.  ü Approved new restrictions on oil and gas financing.  ü Approved targets for three additional sectors – Aviation,  Agriculture and Commercial Real Estate. | | |
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| --- | --- | --- | --- | --- | --- |
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| Culture, colleague and DEI | | | | | |
| Topic | Board activity | Key decisions | | | |
| Culture and  colleague  engagement | • Received updates on Group culture and colleague  engagement, including by way of the 'Your View' survey  results.  • Received regular updates from the Group Chief  Executive on the Group-wide cultural change  programme aimed at ensuring we deliver to a  consistently excellent standard.  • Considered Barclays' workforce engagement  mechanisms to ensure they remain effective in delivering  meaningful, regular two-way dialogue with colleagues. | ü Confirmed that Barclays' method of workforce engagement  has been effective in 2023.  ü Confirmed that Barclays’ workforce policies and practices  are consistent with Barclays’ Values and support Barclays’  long-term sustainable success. | | | |
| DEI | • Received an update on Barclays’ DEI ambitions and the  actions required to achieve those ambitions, with a focus  on progress against our Gender Ambition.  • Received updates on external developments in the DEI  space, including the PRA and FCA consultations aimed at  improving diversity and inclusion in the financial sector. | ü Requested future reviews/deep dives with respect to other  aspects of diversity (in addition to Gender).  ü Adopted a revised Board Diversity and Inclusion Policy in  early 2024. | | | |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 154 |
|  | Governance |  |
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| Directors’ report: Key Board activities (continued) | | | | | | | | | | |

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| + | You can read more about how Barclays  engages with stakeholders in the  Strategic report from page [23](#i4be61753b7f243b19551b0bfbf3a2a0d_10994). |
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| + | You can read more about the 'Consistently Excellent'  programme in our Section 172(1) statement in the Strategic  report on page [38](#i4be61753b7f243b19551b0bfbf3a2a0d_17101). |
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| + | Details of the Board Diversity and Inclusion Policy can be found in  the Board Nominations Committee report  on page [158](#id6f86b9feb8d4bb290582a02d22ac8cc_225152). |
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| + | For further information on Barclays' workforce engagement  mechanisms, please see the Colleagues section in the  Strategic report on page  [42](#i4be61753b7f243b19551b0bfbf3a2a0d_8036) . |
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| Finance | | |
| Topic | Board activity | Key decisions |
| Financial  reporting | • Through regular updates from the Group Finance  Director, assessed the financial performance of the  Group and business divisions and received investor  feedback following publication of the Group's financial  results. | ü Approved the Group’s Annual Report and Accounts for the  year ended 31 December 2022.  ü Approved Q1 2023, HY 2023 and Q3 2023 financial results  announcements. |
| Capital position  and distributions | • Considered the Group’s capital position and  distributions policy. | ü Approved a full year dividend for the year ended  31 December 2022 of 5.0p per ordinary share and a share  buyback of up to £500m.  ü Approved a half year dividend for the period ended  30 June 2023 of 2.7p per ordinary share and a share  buyback of up to £750m. |
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| Risk, including resilience | | | | |  |
| Topic |  | Board activity | | Key decisions |  |
| Risk framework |  | • Considered the Group's risk profile and emerging risk  themes, particularly in the context of macroeconomic  factors such as inflationary pressures and high interest  rates, as well as geopolitical matters. | | ü Approved an update to the Enterprise Risk Management  Framework relating to the framework and governance for  compliance with laws, rules and regulations. | |
| Resilience and  cybersecurity |  | • Considered the Group Resilience Self-Assessment and  management actions to increase resilience.  • Received a briefing from the Group Chief Security  Officer on cybersecurity risk and controls and the  outcome of an independent external assessment of  Barclays' cybersecurity and resilience maturity and  position compared to industry peers. | | ü Approved the Group Resilience Self-Assessment.  ü Agreed that a Board simulation in relation to a cyber-related  incident be conducted (to be run in 2024). | |
| Resolution and  recovery |  | • Considered the Group Resolvability Self-Assessment  ahead of its submission to the Bank of England and the  Group Recovery Plan, which sets out the actions  available in a severe financial stress scenario.  • Received a briefing from management on the lessons  learned from a resolution simulation exercise. | | ü Approved the Group Resolvability Self-Assessment.  ü Approved the Group Recovery Plan. | |
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| Governance and regulatory matters | | | | | | |  |  |
| Topic |  | Board activity | |  | Key decisions | | | |
| Succession |  | • Together with the Board Nominations Committee,  considered succession planning and proposed  appointments for the Board and Board Committees,  having regard to the diversity targets adopted by the  Board and wider Group. | |  | ü Approved the appointments of Marc Moses and Sir John  Kingman to the Board.  ü Approved changes to Board Committee membership as  detailed in the report of the Board Nominations  Committee.  ü Approved the appointment of Hannah Ellwood as the  Group Company Secretary. | | | |
|  |  | + | For further information, please refer to the Board Nominations  Committee report on the next page. |  |
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| Regulatory  engagement and  oversight |  | • Invited representatives from key regulators to join  meetings to hear first-hand their feedback and  observations, in addition to meetings held between  individual Directors (including the Group Chairman and  Group Chief Executive) with regulatory stakeholders  during the year. | |  |  |  |  |  |
| Consumer Duty |  | • Received updates on the Group's implementation of the  FCA's Consumer Duty in the lead up to the  implementation deadline of 31 July 2023, and a  subsequent update post-July, including in relation to  embedment of the Consumer Duty. | |  | ü Approved an amendment to the Matters Reserved to the  Board to provide that responsibility for overseeing the  application of the Consumer Duty regime across the  Group rests with the Board. | | |  |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 155 |
|  | Governance |  |
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| Directors’ report: Key Board activities (continued) | | | | | | | | | | |

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| + | Further details on the Board's oversight of Consumer Duty  are set out in our Section 172(1) statement in the Strategic  report from page  [38](#i4be61753b7f243b19551b0bfbf3a2a0d_17101). |
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| Effective composition and robust  succession plans, with a continued  focus on diversity |
| Ensuring that we continue to have the right balance of skills, experience  and diversity on the Board, Board Committees and ExCo. |

Introduction

In 2023, the Committee continued to

perform a key role in supporting the

delivery of the Group’s strategy through

effective oversight of Board, Board

Committee and ExCo composition, robust

succession planning and evaluating Board

performance.

Through its work, the Committee ensures

that the Board has the right balance of

skills, experience and diversity of

background and thought to be able to

provide informed and constructive

challenge to management while acting

fairly in the interests of our stakeholders.

Committee membership

and activity during 2023

The Committee is chaired by our Group

Chairman, with membership composed

solely of Non-Executive Directors.

Committee membership and meeting

attendance during the year is set out

opposite, and the Committee's activities

during 2023 are described in this report.

In discharging its responsibilities, the

Committee takes into account feedback

from key stakeholders, and from Board

discussions more widely. You can read

more about the Board’s engagement with

stakeholders within our Section 172(1)

statement in the Strategic report from

page [38](#i4be61753b7f243b19551b0bfbf3a2a0d_17101).

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|  |  |
| + | The Committee’s terms of reference are available at  [home.barclays/who-we-are/our-governance/board-](https://home.barclays/who-we-are/our-governance/board-committees/)  [committees/](https://home.barclays/who-we-are/our-governance/board-committees/) |
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|  | Board Nominations Committee | | | | | | | |  |
|  | Nigel Higgins  Chair, Board Nominations Committee | |  |  |  | Committee membership and  meeting attendance during 2023 1 | | |  |
|  | N HIGGINS 0016_Crop_Mint.jpg | |  |  |  | Member | Meetings attended/eligible to attend  (including ad hoc meetings) | |  |
|  |  |  |  | Nigel Higgins | | 3/3 |  |
|  |  |  |  | Mohamed A. El-Erian | | 3/3 |  |
|  |  |  |  | Brian Gilvary | | 3/3 |  |
|  |  |  |  | Diane Schueneman | | 3/3 |  |
|  |  |  |  | Julia Wilson | | 3/3 |  |
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|  | Note:  1    There were two scheduled meetings and one ad  hoc meeting of the Committee in 2023. | | | |  |  |  |  |  |
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| --- | --- | --- |
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| Changes to Board and Board Committee composition in 2023 | | |
| Non-Executive Director | Appointments | Resignations |
| Mike Ashley |  | Audit (Chair) - 31 March 2023  Board - 3 May 2023  Audit (Committee) - 3 May 2023  Risk - 3 May 2023 |
| Crawford Gillies |  | Board - 31 May 2023 |
| Brian Gilvary |  | Risk - 1 June 2023 |
| Sir John Kingman | Board - 1 June 2023  Risk - 16 June 2023  Remuneration - 16 June 2023 |  |
| Marc Moses | Board - 23 January 2023  Audit - 23 January 2023  Risk - 23 January 2023 |  |
| Julia Wilson | Audit (Chair) - 1 April 2023  Remuneration - 1 July 2023 |  |
| A new Board Sustainability Committee was established by the Board on 23 March 2023.  The following Directors were appointed to the Committee: Nigel Higgins (Chair), Robert  Berry, Dawn Fitzpatrick, Mary Francis, Brian Gilvary, C.S. Venkatakrishnan and  Julia Wilson. | | |

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 156 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Nominations Committee report | | | | | | | | | | |

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|  | Composition | |  |
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|  | Through considering the skills,  experience, knowledge and diversity  required for effective Board, Board  Committee and ExCo composition, as  well as overseeing the annual Board,  Board Committee and individual  Director effectiveness evaluations  (outlined later in this report), the  Committee regularly reviews  composition and succession planning  and Non-Executive Director  recruitment priorities.  You can find biographies for each  Director, including details of the skills,  experience and knowledge they bring  to the Board, their Board Committee  memberships and other principal  appointments on pages [145](#i4be61753b7f243b19551b0bfbf3a2a0d_451) to [148](#i4ffc8b21a2004984a69a097ac1c5c011_1-1-2-2-1841111). | |  |
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Changes to Board composition

in 2023

The Committee oversaw a series of

changes to Board and Board Committee

composition during the course of 2023,

building on the progress made in 2022.

Board and Board Committee changes are

set out in the table on the previous page of

this report.

The Board considers that these changes

have enhanced the effectiveness of the

Board and relevant Committees, providing

valuable input and support to their work as

well as bringing new and diverse

perspectives to discussions.

We continued to strengthen the

composition of the Board with the addition

of two Non-Executive Directors in 2023.

Marc Moses, appointed with effect from 23

January 2023, brings to the Board a strong

technical finance background and

extensive knowledge of banking and

financial services. Sir John Kingman has a

deep background in financial services,

gained from his executive and non-

executive career, and joined as a Non-

Executive Director with effect from

1 June 2023, upon taking up his role as

Chair of BBUKPLC.

Mike Ashley retired from the Board at the

conclusion of our AGM on 3 May 2023 and

Crawford Gillies retired shortly thereafter

on 31 May 2023, each having served on the

Board for around nine years. Both Mike and

Crawford made a significant contribution

to the Group during the course of their

tenure, for which the Committee and the

Board are very grateful.

Board size

As at 31 December 2023, the size of the

Board was 13.

Continuing to review the optimal size of

the Board is an important part of the

Committee’s medium and longer-term

succession planning. As part of this, the

Committee takes into account the need

for the Board to be small enough to

operate in an efficient and collaborative

manner yet large enough to ensure an

appropriate mix of skills and diversity, to

support succession planning and to

accommodate the additional roles and

responsibilities of some of our Directors

on Board Committees, and on the Boards

of BBPLC, BBUKPLC, Barclays Europe,

Barclays US LLC and BX.

The Committee considers that the size of

the Board contributes to its effectiveness.

Board composition as at 31 December 2023

|  |
| --- |
|  |
| Length of tenure (Chairman and Non-Executive Directors)  (number of Directors) |
|  |

|  |
| --- |
|  |
| 0-3 years |
| 3-6 years |
| 6-9 years |
| 9+ years1 |

![3657]()

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| --- |
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| International experience3  (number of Directors) |
|  |

|  |
| --- |
|  |
| UK |
| US |
| Rest of the World |

![3663]()

|  |
| --- |
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| Industry and leadership experience²  (number of Directors) |
|  |

|  |
| --- |
|  |
| Financial services |
| Political/Regulatory  experience |
| Current/recent  Chair/CEO |
| Accountancy/  Auditing |
| Operations/  Technology |
| Retail/  Marketing |

![3670]()

Notes

1 Please refer to the section entitled ‘Succession’ later in this report in relation to Tim

Breedon’s tenure and continued independence.

2 Individual Directors may fall into one or more categories.

3 International experience is based on the location of the headquarters/registered office

of a company.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 157 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Nominations Committee report (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Diversity |  |
|  |  |  |
|  |  |  |
|  | The Committee and the Board  recognise the benefits of diversity in all  its forms, including in relation to  gender, ethnicity, age, sexual  orientation, disability and socio-  economic background.  Having due regard for the benefits of  diversity - at Board, Board Committee  and ExCo level - is a vital part of the  Committee’s role in leading  appointments and succession planning  for these key roles. |  |
|  |  |  |

Gender and ethnic diversity

reporting

Disclosures in the form prescribed by the

new UK Listing Rules requirements relating

to gender and ethnic diversity of the Board

and executive management can be found

in this section.

Data relating to the gender and ethnic

diversity of the Board was collected by way

of a questionnaire. This questionnaire

asked all individual Board members to

disclose their gender identity and ethnic

background, on a voluntary self-reporting

basis, by selecting options aligned with

those in the left-hand columns of the

tables to the right (and therefore included

the option not to specify an answer).

Barclays’ employees (including executive

management, as defined in the table to the

right) are asked to confirm their gender

and ethnicity at the onboarding stage, on a

voluntary self-reporting basis, by selecting

options (which include the option not to

specify an answer). Data relating to the

gender and ethnic diversity of executive

management (as defined) was sourced

from this existing data, which is held within

Barclays’ secure HR system.

Board Diversity and Inclusion

Policy

On the recommendation of the

Committee, the Board adopted a revised

version of the Board Diversity and Inclusion

Policy on 8 February 2024.

The policy confirms the Board is

supportive of the Group’s culture in which

Barclays is committed to continuing to

build a diverse, equitable and inclusive

workplace, and that the Board recognises

the benefits of a diverse, equitable and

inclusive Board, reflective of the

communities in which we operate, in

driving effective decision-making.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Gender diversity reporting as at 31 December 2023 | | | | |
| Board  members |  | Senior positions on Board  (CEO, CFO, SID and Chair) |  | Executive  management 1 |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| n | Women |  | n | Women |  | n | Women |
| n | Men |  | n | Men |  | n | Men |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  | Board members | | Number of senior  positions on the Board  (CEO, CFO, SID and Chair) | Executive management1 | |
|  | Number | Percentage | Number | Percentage |
| Men | 8 | 62% | 3 (75%) | 8 | 67% |
| Women | 5 | 38% | 1 (25%) | 4 | 33% |
| Other categories |  |  |  |  |  |
| Not specified/prefer not to say |  |  |  |  |  |
| 1 In accordance with the requirements of the Listing Rules and for the purposes of this table only, 'executive  management' comprises the Group Executive Committee and the Group Company Secretary. | | | | | |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Ethnic diversity reporting as at 31 December 2023 | | | | |
| Board  members |  | Senior positions on Board  (CEO, CFO, SID and Chair) |  | Executive  management 1 |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| n | White British or other White  (including minority-white  groups) |  | n | White British or other White  (including minority-white  groups) |  | n | White British or other White  (including minority-white  groups) |
| n | Asian/British Asian |  | n | Asian/British Asian |  | n | Asian/British Asian |
| n | Other ethnic group,  including Arab |  |  |  |  |  |  |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  | Board members | | Number of senior  positions on the Board  (CEO, CFO, SID and Chair) | Executive management1 | |
|  | Number | Percentage | Number | Percentage |
| White British or other White  (including minority-white groups) | 10 | 77% | 3 (75%) | 9 | 75% |
| Mixed/Multiple Ethnic Groups |  |  |  |  |  |
| Asian/British Asian | 1 | 8% | 1 (25%) | 3 | 25% |
| Black/African/Caribbean/  Black British |  |  |  |  |  |
| Other ethnic group, including  Arab | 2 | 15% |  |  |  |
| Not specified/prefer not to say |  |  |  |  |  |
| 1 In accordance with the requirements of the Listing Rules and for the purposes of this table only, 'executive  management' comprises the Group Executive Committee and the Group Company Secretary. | | | | | |

It confirms Barclays’ commitment to

ensuring that Board appointments and

succession plans are based on merit and

objective criteria, recognising the benefits

that diversity, in all its forms, brings to the

Board, and that due regard will be also

given to diversity and inclusion

characteristics when considering Board

Committee appointments.

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| --- |
|  |
|  |

The policy sets out the Board’s existing

gender and ethnic diversity targets

detailed in the table on the following page,

which are aligned with the targets

recommended by the FTSE Women

Leaders Review on gender diversity and

the Parker Review Committee Report into

Ethnic Diversity of UK Boards, which are

reflected in the Listing Rules.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 158 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Nominations Committee report (continued) | | | | | | | | | | |

![41231686041601]()

![41231686041624]()

![41231686041642]()

![42331197669436]()

![42331197669448]()

![42331197669460]()

In addition, the policy also confirms the

Board's ongoing commitment to operating

in a way that supports diversity, equity and

inclusion, where Directors’ views are both

encouraged and heard.

As set out in the table within this section,

at 31 December 2023, the proportion of

women on the Board was 38%. While this

fell short of the 40% target set out in the

Listing Rules, FTSE Women Leaders

Review and our Board Diversity and

Inclusion Policy, the Board satisfied the

target of having at least one woman in a

senior Board role.

As we reported in our 2022 Annual Report

and as set out in our Board Diversity and

Inclusion Policy (as described above), the

Committee and the Board remain

committed to ensuring that all Board

appointments and succession plans are

based on merit and objective criteria, with

due regard given to diversity, and focused

on meeting our gender diversity targets as

set out in our Board Diversity and Inclusion

Policy by 2025 while continuing to bring the

very best, diverse talent we can attract to

the Board. You can read more about the

Board appointment process and

succession planning in the sections that

follow.

We also recognise and embrace the

benefits of diversity at Board Committee

level. As at 31 December 2023, Board

Committee gender diversity was

as follows:

• Board Nominations Committee

– 40% women

• Board Audit Committee

– 50% women

• Board Risk Committee

– 43% women

• Board Sustainability Committee

– 43% women

• Board Remuneration Committee

– 60% women

Gender diversity within ExCo,

ExCo direct reports and the

wider workforce

Group-wide, Barclays remains committed

to its DEI vision and strategy, which was

refreshed in 2022, and includes a series of

principles and strategic priorities designed

to support Barclays make progress against

the six DEI agendas including its Gender

Ambition, which is focused on improving

gender diversity in senior leadership across

Barclays.

The Board received an update during the

year on Barclays' DEI ambitions, including a

focus on the Gender Ambition, as

described in the Key Board activities

section on page [153](#i4be61753b7f243b19551b0bfbf3a2a0d_7146825599531).

In 2022, Barclays announced its refreshed

Gender Ambition of 33% representation of

women in senior leadership roles -

Managing Directors and Directors - by the

end of 2025, having achieved its initial

target of 28% representation of women in

these roles by the end of 2021.

To achieve this ambition, Barclays focuses

on the retention, development,

progression and hiring of diverse talent at

all levels. Regular reporting on progress

against ambitions is shared with senior

management. As at 31 December 2023,

representation of women among

Managing Directors and Directors was at

30%Δ globally, and Barclays is focused on

continuing its efforts to identify diverse

talent in the market and develop existing

diverse talent within Barclays.

The Committee is also mindful of the

voluntary target recommended by the

FTSE Women Leaders Review of 40%

representation of women for ExCo and

their direct reports by the end of 2025.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | Board Diversity and Inclusion Policy - Targets | |  |
|  | Gender diversity target | To ensure that by 2025:  • the proportion of women on the Board is at least 40%; and  • at least one of the following senior Board positions is held  by a woman: Chair, Chief Executive, Senior Independent  Director or Chief Financial Officer,  and that this is maintained going forward. |  |
|  | Ethnic diversity target | To ensure that at least one Board member is from a minority  ethnic background excluding white ethnic groups and that  this is maintained going forward. |  |

As at 31 December 2023, representation

of women among ExCo and their direct

reports stood at 27%Δ, remaining level with

the 2022 year end position.

While this fell short of the FTSE Women

Leaders Review recommendation,

increasing gender diversity within both

ExCo and their direct reports, to ensure

a diverse pipeline for ExCo succession,

remains a key priority for Barclays and the

Committee.

In 2023, Barclays continued to have one

ex-officio position on ExCo, with each

appointee serving for a four-month

rotation. This initiative, first introduced in

2016, broadens the scope of perspectives

and contributions made to ExCo, while also

providing appointees with exposure to

matters of Group-wide significance and

further leadership experience. In 2023,

all three holders of this position

were women.

There are additional initiatives and actions

being taken across our businesses to

further strengthen the senior leadership

pipeline; these include using the ex officio

position at business unit executive

committees, sponsorship programmes to

support individual development and

working with senior recruitment partners

to strengthen our external pipeline.

Note

Δ  2023 data subject to independent Limited Assurance

under ISAE(UK)3000 and ISAE3410. Current limited

assurance scope and opinion can be found within the

ESG Resource Hub: [home.barclays/sustainability/esg-](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)

[resource-hub/reporting-and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)

|  |  |
| --- | --- |
|  |  |
| + | You can find details of ExCo membership,  including ex-officio appointees during the course  of 2023 , on page  [149](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686057926) . |
|  |

|  |  |
| --- | --- |
|  |  |
| + | You can read more about Barclays' DEI vision and  strategy and gender diversity at Barclays,  including data on the percentage of women in  Barclays’ wider workforce, in our Diversity,  Equity and Inclusion report , which will be made  available on our website later in 2024. |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 159 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Nominations Committee report (continued) | | | | | | | | | | |

Ethnic diversity reporting as at

31 December 2023

As at 31 December 2023, 23% of the

Board (three members) were from a

minority ethnic background (excluding

minority white ethnic groups), meeting the

targets set out in the Listing Rules, the

recommendations contained within the

Parker Review Committee Report into the

Ethnic Diversity of UK Boards and the

ethnic diversity target in the Board

Diversity and Inclusion Policy.

Alongside the Board, the Committee

continues to support the Group’s

Multicultural agenda, including Barclays'

Underrepresented Race and Ethnicity

Ambition. Venkat, our Group Chief

Executive, has made a significant

contribution to Barclays’ diversity agenda.

Having achieved our Race at Work

ambition to double the number of Black

Managing Directors globally from nine to

18 by 2022, in January 2023, we set a new

ambition to increase the population of

Managing Directors from

underrepresented ethnicities by at least

50% by the end of 2025.

You can find more information on Barclays’

continued commitment to its Multicultural

agenda, including information regarding

our ethnic minority percentage target for

ExCo and their direct reports and data

relating to ethnic diversity in Barclays'

wider workforce, in our Diversity, Equity

and Inclusion report, which will be available

on our website later in 2024.

|  |  |
| --- | --- |
|  |  |
| + | You can read more about Barclays' approach to DEI  within the Colleagues section in the Strategic  report from page [27](#i4be61753b7f243b19551b0bfbf3a2a0d_42331197680650). |
|  |

|  |  |
| --- | --- |
|  |  |
| + | You can find a copy of our Board Diversity and  Inclusion Policy  at  [home.barclays/who-we-are/](https://home.barclays/who-we-are/our-governance/our-framework-code-and-rules/)  [our-governance/our-framework-code-and-rules](https://home.barclays/who-we-are/our-governance/our-framework-code-and-rules/) |
|  |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | Process for  appointments | |  |
|  |  |  |  |
|  |  |  |  |
|  | The Committee leads the process for  Board appointments, ensuring that all  appointments are based on merit and  objective criteria - focusing on the  skills, experience and knowledge  required for the Board’s effectiveness  and to support the continued delivery  of the Group’s strategy - while also  promoting diversity of background  and opinion.  Appointments to the Board are made  following a formal, rigorous and  transparent procedure, facilitated by  the Committee with the aid of  external search consultancy firms, as  outlined in further detail below. | |  |
|  |  |  |  |

Non-Executive

Director recruitment

The Committee regularly reviews and

updates a series of skills-based Non-

Executive Director recruitment priorities.

These priorities underpin the searches

required for the Board to ensure orderly

succession as Non-Executive Directors

approach the end of their tenure and to

ensure an optimum balance of skills and

experience on the Board.

The Committee considered and refreshed

the priorities in 2023, in light of Non-

Executive Director recruitment activity,

including the appointments of Marc Moses

and Sir John Kingman during 2023 and two

Non-Executive Directors having stepped

down from the Board in 2023 at the end of

their tenure. The Committee has agreed

that all Board members should have the

opportunity to meet leading candidates,

and that diversity should remain a priority

in all searches.

Based on the agreed priorities, the

Committee has set rigorous criteria for the

roles it is seeking to fill, both in terms of

experience and personal qualities.

Independent search firms Spencer Stuart

and Egon Zehnder supported our targeted

external mapping and search processes

for additional Non-Executive Directors to

complement the range of skills on the

Board in 2023, based on the agreed

criteria. Diversity of background and

experience remain at the forefront of

those searches.

Spencer Stuart and Egon Zehnder do not

have any connection to Barclays or any of

the Directors other than to assist with

searches for executive and non-executive

talent. Open advertising for Board

positions was not used in 2023.

The Committee will continue to review the

Board’s recruitment priorities and give

further consideration to the desired skills

and experience for potential candidates, to

ensure that due consideration continues

to be given to strong potential candidates

who would enhance the effectiveness of

the Board.

Non-Executive Director

independence

In line with the requirements of the Code,

a majority of our Board comprises

independent Non-Executive Directors.

The independence of our Non-Executive

Directors is considered by the Committee

on an annual basis, having regard to the

independence criteria set out in the Code.

As part of this process, the Committee

reviews the length of tenure of all

Directors, which can affect independence,

and makes any recommendations to the

Board accordingly.

The Committee reviewed the

independence of all Non-Executive

Directors serving on the Board as at 31

December 2023. The independence of

those who had served on the Board for

more than six years (Diane Schueneman

and Mary Francis) and more than nine

years (Tim Breedon) was subject to a more

rigorous review. The Committee remains

satisfied that the length of their tenure has

no impact on their respective levels of

independence or the effectiveness of their

contributions. The Committee and the

Board consider all of the Non-Executive

Directors to be independent.

For further details of the Committee’s

review of the independence of Tim

Breedon, please refer to the Succession

section below.

During 2023, Mike Ashley and Crawford

Gillies stepped down from the Board. Mike

and Crawford did not raise any concerns

about the operation of the Board or

management.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 160 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Nominations Committee report (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Director appointments and reappointments | |
|  | Board and executive  appointments process | In 2023, the Committee reviewed and endorsed a refresh of the process for Board and Board Committee  memberships, appointments and removals, and management appointments and removals.  Searches for potential candidates have due regard to the clear benefits of diversity and are co-ordinated across the  Group’s significant subsidiaries where appropriate. We aim to ensure that all Board members have the opportunity to  meet leading candidates where possible. |
|  | Director term | Our standard practice is to appoint any new Non-Executive Director or Chair to the Board for an initial three-year  term, subject to annual re-election at the AGM (as outlined below). This may be extended for a further term of up to  three years.  As such, our Non-Executive Directors typically serve up to a minimum of six years, although this period may be  extended where considered appropriate by the Committee. |
|  | Director appointment  and reappointment  at the AGM | All Directors are subject to appointment or reappointment (as appropriate) each year by shareholders at the AGM. |

Time commitment

All new Directors are asked to disclose

their other significant commitments, which

are then taken into account by the

Committee when considering any

proposed appointment to ensure that

Directors can discharge their

responsibilities to Barclays effectively.

Expected time commitments are agreed

with each Non-Executive Director on an

individual basis, and include time to

understand the business and complete

training as well as time to attend and

prepare for formal Board and Board

Committee meetings. In considering

whether a Director has sufficient time to

commit to their role, the Committee has

regard to regulatory and Code

requirements, as well as key investor and

proxy advisor guidelines. Details of the

external executive and non-executive

directorships held within listed companies

for each of the Directors are set out in the

table on this page. You can find details of

other principal appointments for each

Director in the Board of Directors section

from page [145](#i4be61753b7f243b19551b0bfbf3a2a0d_451).

The Committee reviewed the existing

commitments disclosed by each of Marc

Moses and Sir John Kingman ahead of their

respective appointments to the Board, and

was comfortable that these would not

impact their ability to devote such time as

is necessary to discharge their duties to

Barclays effectively.

Before accepting any significant new

commitment outside of Barclays, all

Directors must seek approval from the

Board (providing an indication of expected

time commitment). Prior to approving any

significant new external commitment for a

Director, the Board reviews all relevant

facts and circumstances (including the

expected role and time commitment, as

well as the nature of the external

organisation).

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Barclays PLC Board – Listed company external directorships1  As at 31 December 2023 | | | | |
| Director | Executive | Non-Executive | Non-Executive Chair | Total |
| Nigel Higgins |  |  |  | None |
| C.S. Venkatakrishnan |  |  |  | None |
| Anna Cross |  |  |  | None |
| Robert Berry |  |  |  | None |
| Tim Breedon |  | 12 | 14 | 2 |
| Mohamed A. El-Erian |  | 13 |  | 1 |
| Dawn Fitzpatrick |  |  |  | None |
| Mary Francis |  | 12 |  | 1 |
| Brian Gilvary |  |  |  | None |
| Sir John Kingman |  |  | 12 | 1 |
| Marc Moses |  |  |  | None |
| Diane Schueneman |  |  |  | None |
| Julia Wilson |  |  |  | None |
| Notes  1 For the purposes of this table, 'listed company' means companies whose shares are listed and traded on a regulated  stock exchange, excluding appointments within the Barclays Group, and directorships held with the same group or  within undertakings (including non-financial entities) in which the relevant firm holds a qualifying holding.  2 UK public listed company.  3 US public listed company.  4 UK listed closed-ended investment company. | | | | |

All Directors are expected to commit

additional time as necessary to their work

on the Board, where circumstances

require. For the year ended 31 December

2023 and as at the date of publication, the

Board is satisfied that none of the

Directors is over-committed and that each

of the Directors allocates sufficient time to

their role in order to discharge their

responsibilities effectively. A record of

each Director’s time commitments is

maintained.

|  |
| --- |
|  |
|  |

Conflicts of interest

The Board has the authority to authorise

Director conflicts of interest, in

accordance with the Companies Act 2006

and BPLC’s articles of association. This

ensures that the influence of third parties

does not compromise the independent

judgement of the Board. Directors are

required to declare any potential or actual

conflicts of interest that could interfere

with their ability to act in the best interests

of the Group.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 161 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Nominations Committee report (continued) | | | | | | | | | | |

A conflicts register recording actual and

potential conflicts of interest, together

with any Board authorisations of conflicts,

is maintained. Authorisations are for an

indefinite period but are reviewed on an bi-

annual basis by the Board. The Board also

considers the effectiveness of the

conflicts authorisation process.

The Board retains the power to vary or

terminate conflicts authorisations at any

time.

Director training and

development

The Committee supports the Group

Chairman in developing and monitoring

effective induction, training and

development for the Board in accordance

with its Terms of Reference (available at

[home.barclays/who-we-are/our-](https://home.barclays/who-we-are/our-governance/board-committees/)

[governance/board-committees](https://home.barclays/who-we-are/our-governance/board-committees/) ).

Directors are provided with the

opportunity to take part in ongoing training

and development, but can also request

specific training, as required.

All Directors receive a comprehensive

induction tailored to their individual

requirements on appointment, designed

to provide them with an understanding of

the operation of the Group and its strategy

and key business areas and functions.

The Group Company Secretary consults

the Group Chairman when designing each

bespoke induction schedule, taking into

account the particular needs of the new

Director.

When a Director is joining a Board

Committee, their induction schedule will

also include an induction to the operation

of that Committee.

An overview of training and development

delivered to the Board during 2023 is

described in the table below.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Training, development and updates for the Board in 2023 | | | | | |
| Topic | Description | Areas covered included | | |  |
| Business and function  reviews | Updates from key business areas and Group  functions, to deepen and broaden the Board’s  understanding of the Group’s businesses, including  key risks and opportunities. | Compliance, Internal Audit, Barclays UK, Barclays Europe,  Markets, Legal, Transaction Banking, UK Corporate, Private  Bank and Wealth Management, Investment Bank, BX  and HR. | | |  |
| 'Horizontal topics' | Focus sessions to deepen the Board's  understanding on key areas of impact/focus  across the Group. | Resilience and Cybersecurity, Consumer Duty, Conduct,  Corporate Strategy, Barclays UK Complaints, Strategic  Policy, Regulatory and Financial Crime. | | |  |
| Public Policy and  Corporate Responsibility | Regular updates on Public Policy and Corporate  Responsibility matters. | Reputation risk matters (for which the Board has direct  oversight) and a broad range of topics including regulatory  engagement and oversight, and climate and  sustainability matters. | | |  |
| Regulatory  responsibilities | Annual briefing on regulatory responsibilities. | Senior Managers Regime and Barclays’ conduct and  financial crime policies and standards. | | |  |
| Corporate governance | Regular updates on developments in corporate  governance matters. | DEI matters, legal and regulatory developments,  cybersecurity disclosure obligations, Directors' duties and  the Economic Crime and Corporate Transparency  Act 2023. | | |  |
| External speakers | External input to the Board. | External briefing to the Board Sustainability Committee on  policy and regulatory developments relating to biodiversity  and nature. | | |  |
| Board engagement  with stakeholders | Various events enabling the Board to engage  directly with stakeholders. |  |  |  |  |
|  | + | You can read more about the Board’s engagement with  stakeholders (including colleagues) within our Section 172(1)  statement in the Strategic report from page [38](#i4be61753b7f243b19551b0bfbf3a2a0d_17101) and the Key Board  activities section on page [153](#i4be61753b7f243b19551b0bfbf3a2a0d_7146825599531). |  |
|  |  |  |
| New Director inductions | Tailored Non-Executive Director inductions for  Marc Moses and Sir John Kingman, following their  respective appointments as Non-Executive  Directors. | Sessions covering the Group’s strategy and culture,  stakeholder landscape and relationships, Board and Board  Committee structure and other governance matters.  Meetings with various senior executives from across the  business including from Finance, Treasury, BX and  Operations, BBUKPLC, CIB, Consumer Banking and  Payments, Risk, Compliance, Public Policy and Corporate  Responsibility, Regulatory Relations, HR, Internal Audit,  Legal and the Group’s external auditor. | | |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 162 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Nominations Committee report (continued) | | | | | | | | | | |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Committee-specific  induction sessions | Committee-specific induction sessions for Marc  Moses and Sir John Kingman. | Sessions providing an introduction to the relevant Board  Committee, including meetings with relevant executives  and briefings on topics relevant to the work of that  Committee. | | |  |
| Handover in accordance  with requirements of the  Senior Managers Regime  (SMR) | Formal SMR handovers from Mike Ashley (as  outgoing Board Audit Committee Chair) to  Julia Wilson (as incoming Board Audit Committee  Chair), and from Crawford Gillies (as outgoing  BBUKPLC Chair and BBUKPLC Board Nominations  Committee Chair) to Sir John Kingman (as  incoming BBUKPLC Chair and BBUKPLC Board  Nominations Committee Chair) . | Series of handover meetings between Mike Ashley and  Julia Wilson, and Crawford Gillies and Sir John Kingman,  relevant to the responsibilities being handed over  (including, for Julia, the role of Group Whistleblowers’  Champion), as well as various meetings with senior  executives as part of Julia's and John's inductions and  transition to their new roles. | | |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Succession |  |
|  |  |  |
|  |  |  |
|  | Through robust succession planning  throughout the year, the Committee  ensures that we will continue to strike  the right balance of skills, experience,  diversity and effectiveness on the  Board, Committees and ExCo, as well  as accounting for current and  anticipated future business needs.  The Committee’s vital work in this area  includes both medium-term planning  (orderly refreshing of the Board,  Committees and ExCo) and long-term  planning (looking ahead to the skills  that may be required on the Board and  the ExCo in the future). |  |
|  |  |  |

Committee consideration of

succession

As at 1 November 2023, Tim Breedon had

served on the Board for 11 years. In early

2024, the Committee undertook a

rigorous assessment of Tim’s continued

independence, as it had done in the two

previous years. Following careful

consideration, the Committee concluded

that it remained appropriate for Tim to

continue to serve on the Board beyond his

11-year tenure.

In reaching this conclusion, the Committee

recognises the significant value that Tim

continues to bring to Board discussions,

particularly given his breadth of financial

services sector experience and deep

knowledge of risk and regulatory issues.

Both the Committee and the Board

continue to believe that it is advantageous

for Group-wide decision-making to have

the Chairs of the Group’s significant

subsidiaries sit on the BPLC Board,

considering that this provides connectivity

with the Group's significant subsidiaries,

bringing with it important insight into Board

discussions. With these factors in mind,

and in light of Tim’s ongoing role as Chair

of Barclays Europe, the Group’s principal

European subsidiary, the Committee and

the Board consider it is appropriate for Tim

to continue as an independent Non-

Executive Director on the BPLC Board in

the near-term.

Given the Board's preference for the

Chairs of the Group's significant

subsidiaries to also be represented on the

Board, in light of Tim's tenure, the

Committee is giving due consideration to

potential successors for his roles on the

Board and as Chair of Barclays Europe.

Diane Schueneman will have been on the

Board for nine years in June 2024, and the

Committee is also giving due

consideration to potential successors for

her roles on the BPLC Board and as Chair

of BX.

Tenure

The Committee and the Board consider

that length of tenure is only one of the

factors to be considered with respect to

Director independence, and accordingly,

that tenure alone should not result in a loss

of independence. The Committee and the

Board are confident that Tim remains

independent and continues to provide

effective challenge, advice and support to

management on business performance

and decision-making. Having undertaken a

rigorous review of Tim’s performance as a

Non-Executive Director and taking into

account other relevant factors that might

be considered likely to impair, or could

appear to impair, his independence

including as set out in Provision 10 of the

Code, the Committee and the Board

consider Tim to be independent.

ExCo succession

The Committee approves all changes to

ExCo composition prior to announcement,

taking into account executive succession

plans.

In 2023, the Committee received updates

regarding succession planning and

proposed appointments for ExCo,

including in relation to the review of the

balance of skills and diversity on ExCo and

for key successors. The Committee

approved the ExCo changes in 2023, as set

out on page [149](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686057926), prior to implementation.

|  |  |
| --- | --- |
|  |  |
| + | You can read more about gender diversity  within ExCo and their direct reports in the  Diversity section of this Board  Nominations Committee report. |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 163 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Nominations Committee report (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Evaluation |  |
|  |  |  |
|  |  |  |
|  | The Committee ensures that a formal  and rigorous review of the  performance of the Board, Board  Committees and individual Directors is  undertaken each year, in line with the  requirements of the Code.  The 2023 effectiveness review was  conducted internally, as permitted by  the Code, following the process  illustrated in the diagram on the right.  The reviews concluded that the Board,  Board Committees and individual  Directors continue to be effective. |  |
|  |  |  |

Progress against the 2022 Board

effectiveness review

As reported in last year's Annual Report,

the 2022 Board effectiveness review was

facilitated internally, in line with the Code.

The 2024 Board effectiveness review is

expected to be externally facilitated, in line

with Code requirements that the Board

effectiveness review be conducted by

an external facilitator at least every

three years.

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  | Board, Committee and individual Director evaluation process | | | | | | |  |
|  |  |  |  |  |  |  |  |  |
|  | Board Nominations Committee approval of approach to evaluation for 2023 | | | | | | |  |
|  | Bright Blue 2_Down.png |  |  |  |  |  |  |  |
|  | Board  evaluation |  | CURRENT HEV WORKING DRAFT - 2023 AR NOMCO REPORT6.png |  |  | |  |  |
|  |  |  | Interviews held  by SID with  Board members |  | Findings discussed with  Group Chairman and  Board Nominations  Committee | | Board discussion  and agreed  action plan for 2024 |  |
|  |  |  |  |  |
|  | Committee  evaluation |  | CURRENT HEV WORKING DRAFT - 2023 AR NOMCO REPORT4.png |  |  | | CURRENT HEV WORKING DRAFT - 2023 AR NOMCO REPORT7.png |  |
|  |  |  | Questionnaires  completed by  Committee members  and senior management |  | Findings discussed  with Committees |  | Agreed action  plan for 2024 |  |
|  |  |  |  |  |  |
|  | Individual Director  evaluation |  | CURRENT HEV WORKING DRAFT - 2023 AR NOMCO REPORT8.png |  | CURRENT HEV WORKING DRAFT - 2023 AR NOMCO REPORT8.png | |  |  |
|  |  |  | Group Chairman held  meeting with each  Director |  | SID held meeting  with the Group Chairman | | Confirmation of each  Director’s continuing  effectiveness |  |
|  |  |  |  |  |  |  |  |  |

Recommendations arising out of the 2022 Board effectiveness review, together with actions taken during the course of the year to

address them, are shown in the table below.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | Areas | Recommendations  from the 2022 evaluation | Actions taken during the year |
|  | Discussion of key  areas of focus | In the context of what is understandably a structured  meeting agenda, Board members would welcome the  opportunity for more unstructured discussion of key areas  of focus for the Board - whether in regard to particular  matters on the agenda or other macro or external  developments since the previous meeting. | Introduction of standing Board agenda item for open  discussion of major current topics with Board members. |
|  | Board agendas | Consideration should continue to be given to the  structure of Board agendas to ensure that time allocations  are appropriate. | The format of certain standing Board agenda items  continued to evolve, with positive Board feedback  received on changes made.  Additional time allocated on the Board agenda for  discussion of material items. |
|  | Board materials | Continued focus on ensuring balanced papers which  clearly identify substantive points and key issues for the  Board’s attention. | The Group Chairman and Group Chief Executive  continued to work with management to ensure that  substantive points and key issues for discussion by the  Board were as clear and concise as possible within papers  presented to the Board. |
|  | Committee reporting  to Board | Continued focus on Committee reporting to the Board, to  ensure the Board has the right level of visibility on key  areas of focus. | Inclusion of written reports of certain Committee  meetings within Board papers, in addition to thematic,  forward-looking reports. |
|  | Engagement with  senior executives | Continue to identify opportunities for more informal  engagement between the Non-Executive Directors and  senior executives outside the boardroom. | More informal engagement included engagement with  management on Board papers, Board and Committee  dinners with relevant senior executives, Board support for  certain client events and Board engagement with  colleagues as described in the Key Board activities section. |
|  | Outside perspectives | Continue to identify opportunities to bring external  perspectives into the Board. | External perspectives included the external briefing  provided to the Board Sustainability Committee on policy  and regulatory developments in relation to biodiversity  and nature. |

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 164 |
|  | Governance |  |
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| Directors’ report: Board Nominations Committee report (continued) | | | | | | | | | | |

2023 Board effectiveness review

Feedback provided by interviewees as part

of the 2023 Board effectiveness review

provides important insight into the Board’s

performance, including areas in which the

Board could be more effective.

Following consideration of the findings of

the 2023 Board effectiveness review, the

Committee remains satisfied that the

Board is operating effectively.

Feedback from 2023 review

Feedback from this review indicated that

the Board is operating well and effectively,

with Board members commenting

favourably on the culture of the Board,

where members feel able to share their

different perspectives and views. Board

members emphasised how this culture is

supported by the inclusive style of the

Group Chairman and his values-driven

approach. The review indicated that Board

composition is considered to be a

strength, bringing together a range of

diverse and complementary backgrounds,

including deep financial services expertise.

The interaction between the Board and

the Board Committees was commented

upon favourably, with regular reporting

ensuring the Board has good visibility on

key areas of focus. The review highlighted

the positive relationship between the

Board and management, and an

appropriate level of support and challenge.

Recommendations from 2023 review

The 2023 review outlined the following key

recommendations:

• consider how Board agendas might be

structured to (i) allow for deeper

discussion of business performance;

and (ii) create more flexibility for

discussion of key topics and reflections

within the agenda

• identify opportunities for more open and

wide-ranging discussions on big picture

issues

• continue to focus on ensuring balanced

papers which clearly identify substantive

points and key issues for the Board’s

attention

• continue to identify opportunities to

bring external perspectives into the

Board.

2023 Board Committee

effectiveness review

The Board Committee reviews are an

important part of the way Barclays

monitors and improves Committee

performance and effectiveness,

maximising strengths and highlighting

areas for further development.

The results of the 2023 Board

Nominations Committee effectiveness

review are reported below, and the results

of the reviews of the effectiveness of the

other Board Committees are reported

within their individual reports elsewhere in

this Board Governance report.

Following consideration of the findings of

the 2023 Board Committee effectiveness

reviews, the Committee remains satisfied

that each of the Board Committees are

operating effectively.

Review of Board Nominations

Committee effectiveness

The results of the 2023 review confirm the

Committee is operating effectively. It is

considered well constituted and chaired,

providing high-quality oversight and

constructive challenge to management in

the areas within its remit. The review

highlights that the Committee is

considered to have the right level of skills

and experience.

Feedback indicates that the allocation of

time between agenda items in Committee

meetings is appropriate, with sufficient

time for discussion and challenge, and

focus on the right areas.

The Committee’s interaction with the

Board, Board Committees and senior

management is considered effective,

noting that sufficient time is allocated at

Board meetings for the Chair to report to

the Board on the work of the Committee.

Feedback indicated that concurrent

meetings of the BPLC and BBPLC Board

Nominations Committee continue to be

effective, with coverage of BBPLC matters

within concurrent meetings considered

appropriate.

Interaction with the BBUKPLC Board

Nominations Committee was also

considered effective, confirming that the

Committee continues to exercise

sufficient oversight of issues relevant to

the Committee’s remit relating to

BBUKPLC.

Individual Director effectiveness

All Directors in office at the end of 2023

were subject to an individual effectiveness

review. The Group Chairman considered

each Director’s individual contribution to

the Board as well as any feedback received

as part of the broader Board and Board

Committee effectiveness reviews.

Based on these reviews, the Board

accepted the view of the Committee that

each Director to be proposed for election

or re-election at the 2024 AGM continues

to be effective and contributes to Barclays’

long-term sustainable success.

All of the current Directors of the

Company intend to submit themselves for

election or re-election at the 2024 AGM

and will be unanimously recommended by

the Board for election or re-election as

appropriate.

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| Directors’ report: Board Nominations Committee report (continued) | | | | | | | | | | |

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| Focused on a robust internal control  environment |
| Overseeing the integrity of our financial disclosures and the effectiveness  of the internal control environment. |

Dear Fellow Shareholders

I was appointed as Chair of the Committee

in April 2023 and so this is my first report of

the Board Audit Committee as Committee

Chair.

I would like to extend my thanks to my

predecessor, Mike Ashley, for his careful

stewardship of the Committee and

diligence in handing it over to me. We also

welcomed Marc Moses to the Committee

on 23 January 2023, bringing his strong

technical finance background with a deep

knowledge of banking and financial

services.

During the year, the Committee has had a

significant focus on management’s

initiatives to drive sustainable

improvements in the Group’s internal

control environment. Specifically, the

Committee received regular updates on

the internal control environment from the

business heads, Group Chief Internal

Auditor, Group Chief Controls Officer and

KPMG, identifying any thematic trends

which may be arising across the Group and

encouraging management to take a pro-

active approach in identifying areas for

enhancement.

The Committee also maintained close

oversight of an internal programme

established by the Group Chief Executive

at the end of 2022, and led by the Group

Chief Operating Officer, to improve senior

oversight of the more material regulatory

remediation programmes with a view to

enhancing controls in order to achieve a

consistently excellent operating

environment across the Group. This

programme operates in parallel with the

broader cultural change programme led by

our Group Chief Executive, which you can

read more about in the Section 172(1)

statement in the Strategic report.

The Committee recognises that

maintaining a robust system of internal

control is a continuous journey and there

will always be programmes in train to

ensure that ongoing improvements are

made. As part of this, the Committee has

been receiving reports on an internal

programme to enhance the system

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|  | Board Audit Committee | | | | | | |  |
|  | Julia Wilson  Chair, Board Audit Committee |  |  |  | Committee membership  and meeting attendance in 2023 1 | | |  |
|  | J WILSON 0031_Crop_Mint.jpg |  |  |  | Member | Meetings attended/eligible to attend | |  |
|  |  |  |  | Julia Wilson | | 12/12 |  |
|  |  |  |  | Robert Berry | | 12/12 |  |
|  |  |  |  | Marc Moses2 | | 12/12 |  |
|  |  |  |  | Diane Schueneman | | 8/12 |  |
|  |  |  |  | Mike Ashley3 | | 6/6 |  |
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|  | Notes  1 There were 12 scheduled meetings of the  Committee in 2023. Owing to prior commitments,  Diane Schueneman was unable to attend four  meetings (with both sets of meetings in February and  October being held in short succession). | | |  | Committee membership in 2023  2 Appointed with effect from 23 January 2023.  3 Retired with effect from 3 May 2023. | | |  |
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of risk management and internal control

for compliance with laws, rules and

regulations. Financial crime controls also

continue to be an area of significant focus

for the Group and the Committee is

closely following management’s progress

in this area to ensure that the control

framework is robust. Previous reports of

the Committee also highlighted significant

work by management on control

remediation and enhancement

programmes in relation to trading controls.

While that work remains ongoing, the

Committee was pleased to see significant

progress made during 2023, with key

remediation programmes in those areas

scheduled to achieve significant

milestones or complete during 2024.

To decide whether any control issues

required specific disclosure in this Annual

Report, the Committee continued to apply

similar concepts to those used for

assessing internal control over financial

reporting for the purposes of the US

Sarbanes-Oxley Act (SOx). The

Committee is satisfied that there are no

control issues which are considered to be a

material weakness and which merit specific

disclosure.

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In overseeing the integrity of our financial

disclosures, the Committee was mindful

that the macroeconomic environment

during the year remained challenging with

continuing high interest rates, inflationary

pressures and geopolitical uncertainty.

The Committee received regular updates

from the Group Finance Director and

Group Chief Accounting Officer, focusing

on key areas including credit impairment

and coverage, provisions, valuations and

tax. The Committee will continue to closely

monitor management’s judgements in

these areas and their disclosure.

The Committee works closely with the

Board Risk Committee and Board

Sustainability Committee, ensuring a

streamlined view of matters of relevance

across the Committees. The Committee

welcomed enhanced reporting by

management with the incorporation of

operational risk dashboards to provide a

more holistic view across the controls and

risk space. This is expected to support the

effective and efficient consideration by the

Board Audit Committee and Board Risk

Committee of matters relevant to both

committees.

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| Directors’ report: Board Audit Committee report | | | | | | | | | | |

With respect to climate matters, the

Committee received input from the Board

Sustainability Committee on our external

climate and sustainability narrative

disclosures. Best practice and regulation

regarding climate and sustainability

reporting and related assurance are still

evolving, while investor and other

stakeholder appetite for information

continues to grow, and this is an area to

which the Committee will continue to have

close regard. Barclays’ climate strategy

remains a key focus of the Group and the

Committee continues to monitor that the

impact of climate change has been

addressed in preparing the Group’s

financial statements.

The independent assurance and challenge

provided by both Barclays Internal Audit

(BIA) and KPMG as statutory auditor are

critical to the Committee’s oversight role

in relation to internal controls and financial

reporting. For this reason, the Committee

continues to hold regular separate private

sessions with each of the Group Chief

Internal Auditor and the lead KPMG audit

engagement partner without

management present.

The Committee has oversight of Barclays’

whistleblowing programme and I took over

the role of Group Whistleblowers'

Champion upon my appointment as

Committee Chair. During 2023, I met with

the FCA and also held regular meetings

with the Whistleblowing team to

understand their key areas of focus and

the Committee continues to receive

detailed semi-annual whistleblowing

updates.

Throughout the year I also held regular

meetings with a number of other

colleagues and stakeholders to discuss

any material and emerging key issues

impacting the Group (including its key

subsidiaries) and of relevance to the

Committee. This included regular

meetings with the Chair of the BBUKPLC

Board Audit Committee, the Group

Finance Director, Group Chief Internal

Auditor and lead KPMG audit partner. As

Committee Chair, throughout the year I

also engaged regularly with the Group’s

key regulators, including meeting with

representatives of the PRA, FCA and

FRBNY.

Committee effectiveness

The results of the Committee

effectiveness review for 2023 confirm the

Committee is operating effectively. It is

considered well constituted and chaired,

providing an effective and appropriate level

of challenge and oversight of the areas

within its remit. Feedback recognised the

effective transition of the Chair in April

2023. The review highlights that the

Committee is considered to have the right

level of skills and experience, including

recent and relevant financial experience,

and is of an appropriate size. Feedback

indicates that the Committee is

considered to operate at the right level of

debate, and confirms that the allocation of

time between agenda items in Committee

meetings is appropriate, with sufficient

time for discussion and challenge.

The Committee’s interaction with the

Board, Board Committees and senior

management is considered effective,

noting that sufficient time is allocated at

Board meetings for the Chair to report to

the Board on the work of the Committee.

Feedback indicated that concurrent

meetings of the BPLC and BBPLC Board

Audit Committee continue to be effective,

with coverage of BBPLC matters within

concurrent meetings considered

appropriate.

Interaction with the BBUKPLC Board Audit

Committee was also considered effective,

confirming that the Committee continues

to exercise sufficient oversight of issues

relevant to the Committee’s remit relating

to BBUKPLC.

Please see the report of the Board

Nominations Committee for details on the

process for conducting the 2023

Committee effectiveness review.

Looking ahead

Management has made some significant

progress on remediation during the course

of 2023; maintaining that momentum in

2024 will be a key focus of the Committee.

Finally, after some five years in the role,

and having made significant progress in

the operation and methodologies used by

BIA, Lindsay O’Reilly will be stepping down

as Group Chief Internal Auditor during

2024. The Committee will be looking to

approve the appointment of a new Group

Chief Internal Auditor in the coming

months and would like to extend its thanks

to Lindsay for her invaluable support, which

is continuing through this transition period.

Julia Wilson

Chair, Board Audit Committee

19 February 2024

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|  | Governance |  |
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| Directors’ report: Board Audit Committee report (continued) | | | | | | | | | | |

Committee composition and

meetings

The Committee is composed solely of

independent Non-Executive Directors.

Membership of the Committee is designed

to provide the breadth of financial expertise

and commercial acumen that the

Committee needs to fulfil its responsibilities.

Its members as a whole have recent and

relevant experience of the banking and

financial services sector, in addition to

general management and commercial

experience; and are financially literate. Julia

Wilson, the Committee Chair, and who is the

designated financial expert on the

Committee for the purposes of SOx, has

significant corporate finance, tax and

accounting experience including serving as

the Group Finance Director of 3i plc from

2008 to 2022 and as Chair of the board audit

committee at Legal & General Group plc.

In 2023, the Committee met 12 times, with

no ad hoc meetings held during the year

(2022: 14 times, including four ad hoc

meetings). Attendance by members at

Committee meetings is shown on page [166](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686054584).

Committee meetings were attended by

representatives from management,

including the Group Chief Executive,

Group Finance Director, Group Chief

Internal Auditor, Group Chief Controls

Officer, Group Chief Risk Officer, Group

Chief Operating Officer, Group General

Counsel and Group Chief Compliance

Officer, as well as representatives from the

businesses and other functions, and from

BBPLC senior management reflecting the

partially consolidated operation of the

BPLC and BBPLC Committee meetings.

The lead audit engagement partner of

KPMG also attended Committee

meetings.

The Board, together with the Committee,

is responsible for ensuring the

independence and effectiveness of the

internal audit function and external

auditors. The appointment and removal of

the Group Chief Internal Auditor is a

matter reserved to the Committee, and

the appointment and removal of the

external auditor is a matter reserved to the

Board based on the recommendation of

the Committee. Neither task is delegated

to management.

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|  | Role of the Committee  The role of the Committee is to  review and monitor, among other  things:  • the integrity of the Group’s financial  statements and related  announcements  • the effectiveness of the Group’s  internal controls  • the independence and  effectiveness of the internal and  external audit processes  • the Group’s relationship with the  external auditor  • the effectiveness of the Group’s  whistleblowing procedures.  The Committee’s terms of reference  are available at [home.barclays/who-](https://home.barclays/who-we-are/our-governance/board-committees/)  [we-are/our-governance/board-](https://home.barclays/who-we-are/our-governance/board-committees/)  [committees/](https://home.barclays/who-we-are/our-governance/board-committees/) |  |
|  |  |  |

Primary activities

The Committee discharged its responsibilities in 2023 through monitoring the effectiveness of the internal control environment and

internal and external audit processes, as well as the integrity of financial statements and related announcements having regard to the

current macroeconomic environment.

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| Areas of focus | Role of Committee / Key issues considered | Conclusion/action taken |
| Financial reporting | | |
| Fair, balanced and  understandable  reporting  (including Country- by-  Country Reporting and  Modern Slavery  Statement) | In light of the Board’s obligation under the  Code, the Committee assesses external  reporting to ensure it is fair, balanced and  understandable. | In addition to this Annual Report and associated year-end reports, the  Committee also reviewed the Group’s half-year and quarterly results  announcements and the presentations to analysts. The Committee informed  these reviews through:  • consideration of reports of the Group Disclosure Committee  • direct questioning of management on the transparency and accuracy of  disclosures  • consideration of the results of management’s processes relating to financial  reporting matters, including the output of the Group’s internal control  assessments and the SOx s404 internal control processes.  The Committee closely considered the Group's financial disclosures and  provided feedback, including on areas where disclosures could be enhanced.  Recognising the increasing focus on, and prominence of, ESG reporting, the  Committee considered the governance and assurance framework for such  disclosures. The Committee emphasised the importance of management  continuing to review and enhance the processes and controls around the  disclosures (particularly in relation to the underlying data) as the disclosure  framework and expected use of the information evolves.  Having evaluated all of the available information, the assurances by  management and underlying processes used to prepare the published financial  information, the Committee concluded and recommended to the Board that  the 2023 Annual Report and Accounts are fair, balanced and understandable. |

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 168 |
|  | Governance |  |
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| Directors’ report: Board Audit Committee report (continued) | | | | | | | | | | |

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| Areas of focus | Role of Committee / Key issues considered | Conclusion/action taken |
| Significant accounting judgements | | |
| Conduct  provisions  (refer to Note 23 to the  financial statements) | Barclays makes certain assumptions and  estimates, analysis of which underpins  provisions made for the costs of customer  redress. The Committee analyses the  judgements and estimates made by  management to evaluate the adequacy of  the provisions, including with regards to  Barclays' provisioning for legacy conduct  issues. | The Committee reviewed and challenged management’s approach to conduct  provisions throughout the year and was satisfied that management's  judgement and approach resulted in an adequate and appropriate level of  provision in relation to the various conduct matters. |
| Impairment of  financial  instruments  (refer to Note 8 to the  financial statements) | The Committee monitors management's  judgements in relation to expected credit  losses (ECLs), which are modelled using a  range of forecast economic scenarios. They  use forward-looking models which require  judgements to be made over modelling  assumptions, including:  • the determination of macroeconomic  scenarios to be used  • the methodology for weighting of  scenarios  • the criteria used to determine significant  deterioration in credit quality  • the application of management  adjustments to the ECL modelled output. | As part of its monitoring, the Committee considered regular reports from  management on:  • the impact of the macroeconomic environment, including high interest  rates, inflationary pressures and unemployment levels  • model changes and model validation, and the impact of this on the use of  post-model adjustments  • the refresh of macroeconomic variables and associated weighting.  The Committee closely considered management’s judgement on impairment  coverage levels, including the impact of increasing delinquency levels in certain  areas of the portfolio.  Having considered and scrutinised the reports, the Committee agreed with  management’s conclusion that the impairment provision was appropriate. |
| Impairment of  goodwill and  intangibles  (refer to Note 21 to the  financial statements) | The Committee considers management's  judgement in relation to goodwill and  intangibles. The carrying value of goodwill  and intangible assets is assessed on the  basis of discounted forecast future earnings.  Given the significant component of earnings  attributable to net interest income, such  forecasts are particularly sensitive to the  level of long-term interest rates and  assumed levels of future lending. The period  over which intangible assets are amortised  appropriately reflects the useful economic  life. | The Committee considered management's reports on its assessment of the  Group's goodwill balances and intangibles to identify any indicators of  impairment, including the methodology and controls applied to the process.  The Committee was satisfied with management's determination on the  indicators of impairment and quantum of the impairment amount identified. |
| Legal,  competition and  regulatory  provisions  (refer to Note 25 to the  financial statements) | Barclays is engaged in various legal,  competition and regulatory matters which  may give rise to provisioning based on the  facts.  The level of provisioning is subject to  management judgement on the basis of  legal advice and is, therefore, an area of  focus for the Committee. | The Committee received regular reports on the status of current legal,  competition and regulatory matters and considered the impact of those  matters on the Group’s provision levels. It also oversaw enhancements in the  reporting to the Committee on these matters. It considered management’s  judgements on the level of provision to be taken and accompanying  disclosures and agreed that the level of provision at the year end was  appropriate.  The Committee also reviewed the disclosures made in respect of legal,  competition and regulatory matters, and concluded that they provided  appropriate information for investors. |
| Valuations  (refer to Notes 13 to  17 to the financial  statements) | Barclays exercises judgement in the  valuation and disclosure of financial  instruments, derivative assets and certain  portfolios, particularly where quoted market  prices are not available. | The Committee scrutinised management's approach to valuations, including in  respect of pensions and the leveraged finance portfolio.  The Committee was satisfied with the accounting treatment in respect of the  various matters. |
| Tax  (refer to Note 9 to the  financial statements) | The Committee is responsible for  considering the Group's tax strategy and  overseeing compliance with the Group's Tax  Principles. Barclays is subject to taxation in a  number of jurisdictions globally and makes  judgements with regard to provisioning for  tax at risk and to the recognition and  measurement of deferred tax assets. | The Committee:  • received reports from the Global Head of Tax, including updates on the work  of the Tax Management Oversight Committee  • reviewed the appropriateness of provisions made for uncertain tax  positions and management’s approach to the tax treatment of index-linked  gilts and its impact on the Group’s effective tax rate  • considered the impact of the UK Government’s implementation of the  OECD’s global minimum tax rules  • monitored the Group’s interactions with tax authorities and the material tax  risks for the Group.  The Committee approved the UK Tax Strategy statement published in the  Country Snapshot report and recommended the Country Snapshot to the  Board for approval. |

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 169 |
|  | Governance |  |
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| Directors’ report: Board Audit Committee report (continued) | | | | | | | | | | |

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| Areas of focus | Role of Committee / Key issues considered | Conclusion/action taken |
| Going concern and viability | | |
| Going concern  and long-term  viability  (refer to the Viability  Statement on page  [54](#i4be61753b7f243b19551b0bfbf3a2a0d_214)) | Barclays is required to assess whether it is  appropriate to prepare the financial  statements on a going concern basis. In  accordance with the Code, Barclays must  provide a statement of its viability. To  support this, the Committee considers both  the going concern assumption and the form  and content of the Viability Statement. | The Committee considered both the going concern assumption and the form  and content of the Viability Statement taking into account:  • the MTP and Working Capital Report  • the forecast capital, liquidity and funding profiles  • the results of stress tests based on internal and regulatory assumptions.  The Committee recommended to the Board that the financial statements  should be prepared on a going concern basis and that there were no material  uncertainties that would impact the going concern statement which required  disclosure.  The Committee recommended the Viability Statement to the Board for  approval. |
| Distributions | | |
| Distributions and  return of capital  to shareholders | The Committee assesses the distributable  reserves position in considering  management’s proposals for distributions  (dividends and share buy-backs) for the full  year ended 31 December 2022 and for the  half year ended 30 June 2023. | Having regard to the distributable reserves available to the Company, the  Committee reviewed and reported to the Board on proposals for (i) a dividend  for the financial year ended 31 December 2022 of 5.0p per share along with a  share buy-back of up to £500m; and (ii) a dividend for the half year ended  30 June 2023 of 2.7p per share along with a share buy-back of up to £750m.  In early 2024, the Committee reviewed and reported to the Board on the  distributable reserves position for the full year dividend for the year ended  31 December 2023 along with a proposed share buy-back. |
| Internal controls |  |  |
| Internal controls  and business  control  environment  (read more about  Barclays' internal  control and risk  management  processes on page  [184](#i4be61753b7f243b19551b0bfbf3a2a0d_496)) | The Committee considers the effectiveness  of the overall control environment, including  the status of any significant control issues  and the progress of specific remediation  plans. | The Committee:  • considered feedback received from regulatory stakeholders on the Group’s  internal control environment and management’s response  • evaluated and tracked the status of the more significant control matters  through regular reports from the Group Chief Controls Officer  • discussed reports from heads of key businesses (including Barclays UK and  BBPLC) on their control environment, together with views from the second  and third lines of defence.  The Committee received regular deep dive reports on the more material  remediation programmes across the Group, keeping a close eye on  management’s progress and delivery against key milestones, including  through to closure of a programme and validation by BIA. The Committee  challenged management’s approach to measuring progress and emphasised  the importance of qualitative factors such as the embedment and  sustainability of programmes. |
| Whistleblowing |  |  |
| Raising concerns | The Committee considers the adequacy of  the Group’s arrangements to allow  colleagues to raise concerns in confidence  and anonymously without fear of retaliation,  and the outcomes of any substantiated  case. | The Committee received detailed semi-annual reports on whistleblowing from  management. It monitored key whistleblowing metrics, the 'speak up' culture  across the Group (and key metrics underpinning this) and any potential  whistleblowing trends which might emerge.  The Committee also monitored the implementation of enhancements to the  whistleblowing process following the external benchmarking review conducted  in 2022. |

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 170 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Audit Committee report (continued) | | | | | | | | | | |

|  |  |  |
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| Areas of focus | Role of Committee / Key issues considered | Conclusion/action taken |
| Internal audit |  |  |
| Internal audit | The Committee monitors and assesses the  performance of BIA and delivery of the  internal audit plan, including scope of work  performed, the level of resources, and the  methodology and coverage of the internal  audit plan. | Through regular reports from BIA, the Committee:  • reviewed and agreed internal audit plans, methodology and deliverables for  2023, including consideration of how regulatory priorities and required  regulatory coverage has been reflected in the plan  • reviewed BIA's audit reports in relation to specific audits, key areas of focus  and themes  • tracked the levels of adverse audits and issues raised by BIA and monitored  related remediation plans  • received regular updates on BIA colleague matters, including colleague  engagement and resourcing  • discussed BIA's assessment of the control environment and management  control approach in Group companies and functions.  The Committee noted the independence of the BIA function, and through  reviewing BIA's quality assurance updates was pleased to see the reports  demonstrating the independence of BIA’s quality assurance function.  The Committee considered and was comfortable with the approach by BIA to  embed the UK Consumer Duty into the BIA framework.  The Committee conducted a performance assessment of BIA for 2023 and  concluded it was satisfied with BIA's performance against its objectives agreed  with the Committee Chair at the beginning of the year.  At the end of the year, the Committee approved the 2024 audit plan, detailing  the number of audits to be undertaken and the focus areas. It also approved  BIA's Audit Charter following the annual review. |
| External audit |  |  |
| External audit | The Committee monitors the work and  performance of KPMG. | The Committee:  • met with key members of the KPMG audit team to discuss the 2023 audit  plan and KPMG’s areas of focus  • approved the 2023 audit plan and the main areas of focus for the year  • assessed regular reports from KPMG on the progress of the 2023 audit and  any material accounting and control issues identified  • discussed KPMG’s draft reports on control areas of focus and the control  environment ahead of the 2023 year end  • approved the terms of the audit engagement letter and associated fees for  2023, on behalf of the Board.  The Committee sought KPMG's views on a number of specific matters,  including management's approach to critical accounting judgements and  estimates, and sought to understand where KPMG had challenged  management's assessment prior to reaching a conclusion. This included  considering KPMG challenge in relation to key controls matters and the  approach to disclosures in the Group's full year, half-year and interim financial  results.  The Committee considered KPMG’s response to the PRA Written Auditor  Reporting for 2022, and discussed with KPMG the questions in scope for the  2023 Written Auditor Reporting. |

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 171 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Audit Committee report (continued) | | | | | | | | | | |

External auditor

Following an external audit tender in 2015, KPMG was appointed as Barclays’ statutory auditor with effect from the 2017 financial year.

Stuart Crisp, Barclays’ lead audit engagement partner, has been in the role since 2022 and attends all meetings of the Committee.

Assessing external auditor effectiveness, objectivity and independence and non-audit services

The Committee is responsible for assessing the effectiveness, objectivity and independence of the Group’s statutory auditor. This

responsibility was discharged by the Committee throughout the year at formal meetings, during private meetings with KPMG and

through discussions with key Group executives. In particular, the Committee assessed KPMG’s effectiveness, objectivity and

independence in the following ways:

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|  | Throughout the year  • Met with senior members of the KPMG audit team from  the UK, Ireland and US to discuss the approach to the 2023  audit.  • Reviewed regular reports from management on the non-  audit services provided by KPMG to Barclays.  • Reviewed regular reports from management detailing any  employees or workers hired from KPMG.  • Discussed with KPMG their consideration of internal  controls over financial reporting.  • Considered areas in which KPMG had challenged  management’s assumptions in areas of key judgement.  • Assessed any potential threats to independence that were  self-identified and reported by KPMG, all of which were  regarded by the Committee as being adequately  addressed. |  |  |  | Annual assessment, audit quality  and external findings  • The Group undertakes an annual formal assessment of  KPMG’s performance, independence and objectivity. The  assessment for 2023 was conducted in early 2024, by way  of a questionnaire completed by key stakeholders across  the Group who have regular interaction with KPMG. The  questionnaire was designed to evaluate KPMG’s audit  process, its effectiveness and overall output.  • Consistent with previous years, in 2023 KPMG nominated  a senior partner of the audit team to have specific  responsibility for ensuring audit quality. The Committee  received reports from him during the year on his  assessment of audit quality.  • The findings of the FRC’s Audit Quality Report on KPMG  published in July 2023, including its inspection of the  Barclays audit for the year ended 31 December 2021,  provided further comfort to the Committee on the quality  and effectiveness of KPMG’s audit, acknowledging that  there remains areas for improvement. |  |
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|  | Arrow light blue.png |  |  |  | Arrow light blue.png |  |
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|  | Outcome  Taking into account the result of all of the above, the Committee considered that KPMG maintained its independence and  objectivity, exercised robust challenge and demonstrated professional scepticism in the audit process. The Committee was  therefore satisfied that the audit process was effective. | | | | |  |
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Non-audit services

In order to safeguard the auditor’s

independence and objectivity, Barclays has

in place the Group Policy on the Provision

of Services by the Group Statutory Auditor

(the Policy) setting out the circumstances

in which the auditor may be engaged to

provide non-audit services. The Policy

applies to all Barclays subsidiaries and

other material entities over which Barclays

has significant influence. The core principle

of the Policy is that non-audit services

(other than those legally required to be

carried out by the Group’s auditor) should

be performed by the auditor only in certain

controlled circumstances. A summary of

the Policy can be found at [home.barclays/](https://home.barclays/who-we-are/our-governance/auditor-independence/)

[who-we-are/our-governance/auditor-](https://home.barclays/who-we-are/our-governance/auditor-independence/)

[independence/](https://home.barclays/who-we-are/our-governance/auditor-independence/)

The Policy sets out the type of services

that the auditor is permitted to carry out

and pre-approves certain of these services

provided the fee is below a certain

threshold, except for specific categories of

permitted services that require explicit

Committee approval. All other permitted

services must be approved in advance by

the Committee. The Policy requires that all

proposed work must be sponsored by a

senior executive who is not involved in any

work to which the proposed engagement

relates. The audit assignment partner

must also confirm that the engagement

has been approved in accordance with the

auditor’s own internal ethical standards

and does not pose any threat to the

auditor’s independence or objectivity.

The Policy is reviewed by the Committee

on an annual basis to ensure that it is fit for

purpose and that it reflects applicable rules

and guidelines. The Policy is aligned with

both the FRC’s requirements and KPMG’s

own internal policy on non-audit services

for FTSE 350 companies, which broadly

restricts non-audit work to services that

are ‘closely related’ to the audit.

In early 2023, KPMG advised the

Committee that, following on from an

event notified to the Committee in late

2022, a further instance had been

identified of a KPMG member firm having

provided services in connection with the

preparation of local statutory accounts of

a small overseas subsidiary not in scope for

the Group audit. KPMG assured the

Committee, having made appropriate

enquiries of their member firms providing

services to the Group, that these were

isolated instances. In these circumstances,

the Committee agreed with KPMG’s

assessment that this had not impaired

their integrity or objectivity.

In view of the events notified by KPMG, the

Committee reviewed the Policy in early

2023 to determine whether any revisions

were required to ensure such events did

not arise again. While it was determined

that the Policy provided sufficiently clear

guidance in terms of prohibited non-audit

service work, certain enhancements were

made to the Policy to further support the

operation of the Policy including by

specifying examples of the type of work

prohibited under each headline service.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 172 |
|  | Governance |  |
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| Directors’ report: Board Audit Committee report (continued) | | | | | | | | | | |

The fees payable to KPMG for the year

ended 31 December 2023 amounted to

£78m (2022: £71m), of which £14m (2022:

£13m) was payable in respect of non-audit

services. A breakdown of the fees payable

to the auditor for statutory audit and non-

audit work can be found in Note 39 of the

financial statements. Of the £14m of non-

audit services provided by KPMG during

2023, the significant categories of

engagement, i.e. services where the fees

amounted to more than £500,000,

included:

• audit-related services: services in

connection with CASS (Client Assets

Sourcebook) audits

• other services in connection with

regulatory, compliance and internal

control reports and specific audit

procedures, required by law or

regulation to be provided by the

statutory auditor

• other attestation and assurance

services, such as ongoing attestation

and assurance services for treasury

and capital markets transactions to

meet regulatory requirements, including

regular reporting obligations and

verification reports.

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|  | The Statutory Audit Services for Large Companies Market  Investigation (Mandatory Use of Competitive Tender Processes  and Audit Committee Responsibilities) Order 2014  An external audit tender was conducted in 2015 and the decision was made to  appoint KPMG as Barclays’ external auditor with effect from the 2017 financial year.  Barclays is in compliance with the requirements of The Statutory Audit Services for  Large Companies Market Investigation (Mandatory Use of Competitive Tender  Processes and Audit Committee Responsibilities) Order 2014, which relates to the  frequency and governance of tenders for the appointment of the external auditor  and the setting of a policy on the provision of non-audit services.  As explained in previous Committee reports, provided that KPMG continues to  maintain its independence and objectivity, and the Committee remains satisfied  with its performance, the Board does not intend to tender for an alternative external  auditor to be appointed before the end of the current required period of 10 years.  Accordingly, any tender is expected to be in respect of the 2027 financial year  onwards and is likely to take place in 2025. The Committee has reconfirmed that it  would not be appropriate to tender before this date. The Committee observed that  there has been significant rotation of the senior members of the audit team since  2017 and more recent changes in certain members of the Barclays senior finance  team, both of which have reduced any potential familiarisation threat. |  |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 173 |
|  | Governance |  |
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| Directors’ report: Board Audit Committee report (continued) | | | | | | | | | | |

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| --- |
|  |
| Providing considered risk oversight  through challenging times |
| Proactive risk management in a dynamic risk environment. |

Dear Fellow Shareholders

During 2023, the Committee focused on

the financial and operational challenges

arising from ongoing macroeconomic

uncertainty and geopolitical tensions,

overseeing management’s proactive

approach to positioning the Group

appropriately for the uncertain

environment.

The macroeconomic outlook was defined

by central bank efforts to contain inflation

through higher interest rates, balanced

against the desire to protect economic

growth and employment. As the year

came to a close, market participants

remained focused on the expected turn of

the rates cycle and the implications for

asset prices and the credit cycle. The

Committee remained watchful of these

events and other risks, such as the

potential for disorderly market corrections

and economic slowdowns across the

globe; alongside wider geopolitical

tensions and their impact on Barclays’

portfolios and businesses. Throughout the

year the Committee heard from and

challenged senior business leaders, in

addition to second line risk and compliance

colleagues, about how they consider and

manage risks as they execute their

business strategies, including any

mitigating actions being taken.

2023 was undoubtedly a challenging year

for the banking sector with significant

market volatility, particularly in the first half

of the year, coupled with the collapse of a

number of US regional banks and the

takeover of a distressed global bank. In

addition to overseeing Barclays’

management of its liquidity and capital

positions, the Committee reviewed

management’s learnings from these

events to help ensure that Barclays

remains resilient through periods of stress.

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|  | Board Risk Committee | | | | | | |  |
|  | Robert Berry  Chair, Board Risk Committee |  |  |  | Committee membership  and meeting attendance in 2023 1 | | |  |
|  | R BERRY 0066_Crop_Mint.jpg |  |  |  | Member | Meetings attended/eligible to attend  (including ad hoc meetings) | |  |
|  |  |  |  | Robert Berry | | 11/11 |  |
|  |  |  |  | Mohamed A. El-Erian | | 9/11 |  |
|  |  |  |  | Dawn Fitzpatrick | | 11/11 |  |
|  |  |  |  | Sir John Kingman2 | | 5/5 |  |
|  |  |  |  | Marc Moses3 | | 11/11 |  |
|  |  |  |  | Diane Schueneman | | 9/11 |  |
|  |  |  |  | Julia Wilson | | 11/11 |  |
|  |  |  |  | Mike Ashley4 | | 4/4 |  |
|  |  |  |  | Brian Gilvary5 |  | 4/5 |  |
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|  | Notes  1 There were nine scheduled meetings and two ad hoc  meetings of the Committee in 2023. Owing to prior  commitments and ad hoc meetings being called at  short notice, Mohamed A. El-Erian was unable to  attend two scheduled meetings, Diane Schueneman  was unable to attend one scheduled meeting and  one ad hoc meeting and Brian Gilvary was unable to  attend one ad hoc meeting. | | |  | Committee membership in 2023  2 Appointed with effect from 16 June 2023.  3 Appointed with effect from 23 January 2023.  4 Retired  with effect from 3 May 2023.  5 Retired  with effect from 1 June 2023.  Notes | | |  |
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Alongside financial risks, the Committee

oversaw management’s work to drive

robust operational risk management

across Barclays; in this regard, the

Committee considered the risks of cyber-

related attacks and their potential impact

on customers and clients, and heard from

management about ongoing work to

strengthen the bank’s cybersecurity

defences. In addition, the Committee

monitored work in Barclays UK designed to

reduce risk by improving the control

environment and drive efficiencies.

The Committee tracked Barclays' progress

towards ensuring it can recover its most

important business services in the event of

material service disruption within tolerance

by the regulatory deadline of March 2025.

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|  |

Financial crime risk across the financial

services sector has grown as a result of the

increasing sophistication of bad-actors. In

recognition of the growing risks, the

Committee closely monitored

management’s work to identify and

mitigate financial crime risk across the

Group, in line with increased regulatory

expectations.

Conduct risk remains a key area of

oversight. The Committee oversaw

management’s preparations for the

implementation of the Financial Conduct

Authority’s (FCA) ‘Consumer Duty' in July

2023, and continues to monitor

management's efforts to ensure good

outcomes for retail customers.

During the year, the Committee reviewed

changes to the Group’s Enterprise Risk

Management Framework (ERMF), to

underpin work to strengthen how the

Group manages the risks of non-

compliance with laws, rules and regulations

(LRR). As part of this a new LRR risk was

established alongside conduct risk under a

new Principal Risk called Compliance risk.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 174 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Risk Committee report | | | | | | | | | | |

The Committee continued to oversee how

climate change is driving financial and

operational risks, the materiality of their

impact and how Barclays is managing them

through the Climate Principal Risk

Framework. The Committee received

updates on the Bank’s ongoing

advancements to its climate risk

management approach, including the

development of a risk appetite, monitored

through a range of quantitative metrics.

The Committee also heard from senior

business leaders about how climate risks

are being integrated into their business

strategies and plans.

The Committee approved the results of

the 2023 internal climate stress test (CST)

and considered lessons learned that will

enable Barclays to better assess specific

climate vulnerabilities as well as the impact

that climate factors can have on the

financial stresses used to calibrate overall

risk appetite. The Committee will continue

to maintain close oversight of the annual

CST as it is further integrated into the

Group’s planning and stress testing

framework.

As part of its work overseeing climate risk,

the Committee worked closely with the

Board Audit Committee and Board

Sustainability Committee, ensuring a

streamlined view of matters of relevance

across the Committees.

The Group uses models and data to

support a broad range of business

decisions and risk management activities

across the Group. This is an area impacted

by rapid technological change and

increasing regulatory scrutiny and the

Committee continued to focus on the

Bank’s approach to managing the

associated risks, including its approach to

developing and validating models, and

monitoring of their performance through a

volatile macro environment.

The volume of regulatory change across

the global financial services industry is

significant. The Committee heard from

management about the impact of these

changes for Barclays and the work

necessary to ensure compliance. This is an

area to which the Committee expects to

devote attention in 2024 and beyond.

By way of a final word, in 2023, the

Committee oversaw a change to the

senior management of the Compliance

function, with the appointment of a new

Group Chief Compliance Officer, Kirsty

Everett, who took up the role in July 2023.

In 2023 we also welcomed both Marc

Moses and Sir John Kingman (Chair of

Barclays UK) to the Committee, both of

whom bring with them a deep knowledge

of financial services.

Committee effectiveness

The results of the Committee

effectiveness review for 2023 confirm the

Committee is operating effectively; it is

considered well constituted and chaired,

providing an effective and appropriate level

of challenge and oversight of the areas

within its remit. Feedback noted members’

wide and diverse skills and experience,

recognising that recent additions to

Committee composition had been positive

in providing the Committee with a deeper

retail perspective. Feedback indicates that

the Committee is considered to operate at

the right level of debate. It also confirms

that the allocation of time between agenda

items in meetings is appropriate, with

sufficient time for discussion and

challenge.

The Committee’s interaction with the

Board, Board Committees and senior

management is also considered effective,

noting that sufficient time is allocated at

Board meetings for the Chair to report to

the Board on the work of the Committee.

Feedback indicated that concurrent

meetings of the BPLC and BBPLC Board

Risk Committee continue to be effective,

with coverage of BBPLC matters within

concurrent meetings considered

appropriate.

Interaction with the BBUKPLC Board Risk

Committee was also considered effective,

confirming that the Committee continues

to exercise appropriate oversight of issues

relevant to the Committee’s remit relating

to BBUKPLC.

Please see the report of the Board

Nominations Committee for further details

on the process for conducting the 2023

Committee effectiveness review.

Looking ahead

The Committee actively encourages

management to be alert to areas of

emerging risk, particularly in light of the

rapidly evolving macroeconomic,

geopolitical and technological

environments. As we move into 2024,

geopolitical tensions, macroeconomic

uncertainty and inflationary pressures are

expected to continue, with further

uncertainty on the horizon in light of the

upcoming election cycles in many of our

key markets, including the US and UK. The

Committee will continue to work with

management to anticipate, stress test and

prepare for periods of volatility to prevent

outsized or unexpected losses

materialising and to manage emerging

risks as they arise.

Robert Berry

Chair, Board Risk Committee

19 February 2024

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 175 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Risk Committee report (continued) | | | | | | | | | | |

Committee meetings

In 2023, the Committee met 11 times

(including two ad hoc meetings) and the

attendance by members at these

meetings is shown on page [174](#i4be61753b7f243b19551b0bfbf3a2a0d_487). In addition

to its members, Committee meetings

were attended by representatives from

senior management, including the Group

Chief Executive, Group Chief Risk Officer,

Group Finance Director, Group Chief

Internal Auditor, Group Treasurer, Group

Chief Compliance Officer and Group

General Counsel, as well as

representatives from the businesses and

additional colleagues from the Risk

function. The Committee held regular

private sessions with the Group Chief Risk

Officer and the Group Chief Compliance

Officer; these were not attended by other

members of management. The lead audit

engagement partner of KPMG also

attended Committee meetings.

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|  | Committee roles and responsibilities  The Committee is responsible for reviewing, on behalf of the Board, management’s  recommendations on the Principal Risks as set out in the ERMF (with the exception of  reputation risk, which is a matter reserved to the Board), and in particular:  • reviewing, on behalf of the Board, the management of those Principal Risks in the  ERMF  • considering and recommending to the Board the Group’s risk appetite and  tolerances for those Principal Risks  • reviewing, on behalf of the Board, the Group’s risk profile for those Principal Risks  • commissioning, receiving and considering reports on key risk issues  • safeguarding the independence, and overseeing the performance, of Barclays’ Risk  and Compliance functions.  The Committee’s terms of reference are available at [home.barclays/who-we-are/our-](https://home.barclays/who-we-are/our-governance/board-committees)  [governance/board-committees](https://home.barclays/who-we-are/our-governance/board-committees)/ |  |
|  |  |  |

Primary activities

The Committee discharged its responsibilities in 2023 through reviewing and monitoring Group exposures in the context of the current

and emerging risks facing the Group. The Committee seeks to promote a strong culture of disciplined risk management.

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|  |  |  |
| Areas of focus | Key role of Committee | Conclusion/action taken |
| Risk framework and  governance | • To review the design of the ERMF and  recommend to the Board for approval any  relevant changes.  • To track the progress of significant risk  management projects.  • To consider risk management matters raised by  Barclays’ regulators and monitor the actions  being taken by management to respond.  • To review the effectiveness of the Company's  risk management systems. | • The Committee reviewed an update to the ERMF to  clarify roles and responsibilities of Legal, Compliance  and Risk, particularly relating to the framework and  governance for compliance with LRRs. The  Committee recommended the updated ERMF to the  Board for approval.  • The Committee reviewed reports from management  on guidance, letters and reviews received from  regulators. The Committee examined management’s  responses to the matters raised by regulators and  received updates on key remediation programmes. |
| Risk appetite and stress  testing  i.e. the level of risk the Group  chooses to take in pursuit of  its business objectives,  including testing whether the  Group’s financial position and  risk profile provide sufficient  resilience to withstand the  impact of severe but plausible  economic scenarios. | • To propose to the Board an appropriate risk  appetite and tolerance for the Principal Risks,  including an overall Group risk appetite and  limits.  • To review and approve the methodology used  to establish the Group’s risk appetite and  associated stress testing.  • To discuss and agree stress loss and mandate  and scale limits for credit risk, market risk,  operational risk and treasury and capital risk.  • To consider and approve internal stress test  (IST) themes, and consider the financial  constraints and scenarios, for stress testing risk  appetite for the Medium Term Plan (MTP).  • To consider and approve the results of stress  tests required by regulatory bodies. | • The Committee discussed and approved the mandate  and scale limits as well as the stress loss limits for the  Group. Subsequent changes were reviewed and  approved during the course of the year.  • The Committee considered and approved stress test  results, including those of the 2023 IST and reverse  IST, as well as the associated risk appetite for the  MTP.  • The Committee reviewed and approved the results of  the internal CST, and received a report on the lessons  learned from the exercise.  • The Committee considered feedback from the FRB  on Barclays US LLC’s Comprehensive Capital Analysis  and Review (CCAR) following the submission of the  CCAR stress test results. |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 176 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Risk Committee report (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Areas of focus | Key role of Committee | Conclusion/action taken |
| Risk profile  i.e. the impact on the Group’s  risk profile of geopolitical and  macroeconomic  developments and conditions. | • To evaluate and report to the Board on the  Group’s risk profile and monitoring of the  Principal Risks in the ERMF.  • To consider proposed material changes to the  Group’s risk profile. | • The Committee received regular updates on the  Group's risk profile from the Group Chief Risk Officer.  • The Committee examined key risk themes in order to  monitor the evolving risk environment in which  Barclays operates, the response of management, and  the changing risk profile of the Group.  • The Committee considered macroeconomic  developments, including economic slowdown across  several major economies, inflationary pressures,  market volatility, higher energy costs and supply chain  constraints, the path of interest rates, and the  associated consumer affordability stresses.  • The Committee monitored the Group's exposures to  geopolitical risks and considered longer-term and  emerging risk themes. |
| Credit risk and Market risk  i.e. the risk of financial loss if  customers, clients or  counterparties fail to fully  honour their obligations; or  due to market movements. | • To review and consider vulnerabilities to credit  losses in the bank’s lending and banking  transactions which expose the firm to credit risk.  • To review and consider the risk of loss arising  from potential adverse changes in the value of  the firm’s assets and liabilities from fluctuation in  market variables. | • The Committee considered a report from  management following market events in relation to  the distress of a number of financial institutions and  takeover of a global bank and lessons learned for  process and operational improvements.  • In light of the challenging inflationary and rates  environment throughout 2023, the Committee  considered updates on the impact on consumer  indebtedness and Barclays consumer portfolios.  • The Committee received regular updates on credit  risk and market risk within the CIB, with a particular  focus on the structured lending and finance and  leveraged finance portfolios.  • The Committee received reports on enhancements  to regulatory reporting. |
| Treasury and Capital risk  i.e. having sufficient capital and  financial resources to meet  the Group’s regulatory  requirements and its  obligations as they fall due, to  maintain its credit rating, to  support growth and strategic  option. | • To review capital performance against plan,  tracking the capital trajectory, any challenges  and opportunities and regulatory policy  developments.  • To assess liquidity performance against both  internal and regulatory requirements, and review  any challenges and opportunities.  • To monitor capital and funding requirements.  • To consider the ICAAP and ILAAP scenario  review. | • The Committee reviewed capital and liquidity  performance and the forecast capital and funding  trajectory, including the actions identified by  management to manage the Group's capital position,  taking into account relevant macroeconomic factors.  • The Committee received a preliminary assessment of  the ICAAP and the ILAAP in May 2023. The  Committee subsequently discussed and approved the  Group's 2023 ICAAP and the Group's 2023 ILAAP  prior to their submission to the PRA.  • The Committee recommended to the Board for  approval the Group Recovery Plan, which forms part of  the Group’s capital and liquidity risk management  framework.  • The Committee reviewed the Resolvability  Assessment Framework (RAF), along with lessons  learned from a Recovery and Resolution Simulation  Exercise and recommended the RAF to the Board for  approval.  • The Committee monitored preparations for  compliance with Trading Wind Down capabilities in the  context of recovery planning and post resolution  restructuring. |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 177 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Risk Committee report (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Areas of focus | Key role of Committee | Conclusion/action taken |
| Climate risk  i.e. the impact on financial and  operational risks arising from  climate change through  physical risks, risks associated  with transitioning to a lower-  carbon economy and  connected risks. | • To consider and assess the impact of climate  risk on the Group’s activities. | • The Committee received regular updates on climate  risk including areas of elevated climate risk and  progress against sector targets.  • The Committee considered progress and plans  around integration of climate into business actions  and the development of quantitative climate risk  appetite and an additional climate stress as a  secondary test for the MTP.  • The Committee reviewed how climate change is  driving financial and operational risks and how Barclays  is managing them. |
| Operational risk  i.e. the risk of loss arising from  inadequate or failed processes  and systems, human factors or  due to external events. | • To review the Group’s operational risk profile  and consider specific areas of operational risks,  including fraud, conduct risk, operational  recovery planning, cybersecurity risk, execution  risk, technology and data, including the controls  that are in place for managing and mitigating  such risks.  • To track operational risk key indicators. | • The Committee received regular reporting on key  operational risk indicators and was briefed by  management on a number of operational risks topics,  including those relating to technology risk, fraud, third  party risk management, cyber and information  security and the risks associated with new business  activities.  • The Committee oversaw and provided feedback on  work to redesign the new and amended products  process, including a new governance framework.  • The Committee considered operational resilience,  including reviewing and recommending to the Board  for approval the 2023 Resilience Self-Assessment  report, detailing the resilience risks which may impact  Barclays’ ability to recover within impact tolerance,  and to ensure plans align to enhanced expectations  intended to reduce the risk of customer/client harm.  • The Committee received updates on cyber resilience  and reviewed the results of an external benchmarking  exercise to test cybersecurity and resilience.  • The Committee considered operational risks in the  context of work in Barclays UK to upgrade its  technology platform to improve the control  environment and drive efficiencies. |
| Model risk  i.e. the potential for adverse  consequences from decisions  based on incorrect or misused  model outputs and reports. | ▪ To evaluate the appropriateness of the Model  Risk Management Framework, including  receiving updates on findings in relation to  specific modelling processes. | • The Committee reviewed and discussed regular  updates on model risk, including progress in  developing the Model Risk Management Framework,  and in relation to the continued focus and momentum  required to address increasing regulatory  expectations and the development of an uncertainty  framework for large models frameworks.  • The Committee continued its oversight of the new  independent Model Strategy and Oversight team,  particularly with respect to review of and  enhancements made to key models and  developments and remediations. |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 178 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Risk Committee report (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Areas of focus | Key role of Committee | Conclusion/action taken |
| Compliance risk  i.e. Compliance risk is  comprised of (i) LRR risk and (ii)  conduct risk, which is the risk  of poor outcomes to  customers, clients and  markets, arising from the  delivery of the Group's  products and services. | • To receive updates from management on  conduct risk and consider performance against  key conduct risk indicators and the status of  initiatives in place to address those risks to  further strengthen the culture of the business.  • To review the effectiveness of the Conduct Risk  Framework.  • To oversee how Barclays mitigates the risk of  non-compliance with LRR risk. | • The Committee received regular updates on conduct  risk and assessments of potential risks to the Group  following market events.  • The Committee received updates on lessons learned  reviews undertaken in response to industry  developments and events, and continued to monitor  ongoing remediation activities.  • The Committee received regular updates on the  management of the Group’s financial crime risk.  • The Committee received briefings on the Group’s  preparations for commencement of the FCA’s new  Consumer Duty. |
| Legal risk  i.e. the risk of loss or  imposition of penalties,  damages or fines from the  failure of the firm to meet its  legal obligations, including  regulatory or contractual  requirements. | • To monitor the Group’s legal risk profile, including  considering potential material emerging legal risks. | • The Committee received regular updates on the legal  risks faced by the Group, including horizon scanning  for key areas of emerging legal risk and Barclays’ ability  to manage these and other risk trends. |
| Remuneration | • To make a recommendation to the Board  Remuneration Committee on the financial and  operational risk factors to be taken into account  in annual remuneration decisions. | • The Committee considered the 2023 ex-ante risk  adjustment methodology including input from the  Group Chief Risk Officer and the Group Chief  Compliance Officer. |
| Oversight of the Risk and  Compliance functions | • To safeguard the independence of, and oversee  the performance of, Barclays' Risk and  Compliance functions.  • To satisfy itself that the Barclays Compliance  and Risk functions are adequately resourced,  and have appropriate access to information so  as to be able to perform their functions  effectively.  • To review the Compliance function’s Annual  Compliance Plan.  • To oversee the Group’s compliance and  risk culture. | • The Committee considered assessments of the  performance of the Risk and Compliance functions.  • The Committee met privately with the Chief Risk  Officer and Chief Compliance Officer on a regular  basis.  • The Committee approved the Annual Compliance  Plan.  • The Committee received updates on the compliance  and risk culture within the Group. |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 179 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Risk Committee report (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| Driving forward our net zero ambition |
| Overseeing our climate and sustainability strategy. |

Dear Fellow Shareholders

I am delighted to present to you the first

report of the Board Sustainability

Committee.

In March 2020, Barclays announced its

ambition to be a net zero bank by 2050,

becoming one of the first banks to do so. In

2023, we continued to pursue

opportunities and support our clients as

they transition their businesses to a low-

carbon economy.

When I wrote to you ahead of our 2023

AGM, I highlighted that a key commitment

for Barclays over the subsequent 12

months was to help finance this transition

and in December 2022 we announced a

new target to facilitate $1trn of Sustainable

and Transition Financing between 2023

and 2030, and increased our investment

mandate to £500m of capital to invest in

early-stage climate-tech companies by the

end of 2027. Today we are reporting

$67.8bn financing facilitated towards the

$1trn Sustainable and Transition Financing

target and £138m invested since March

2020 in 21 climate-tech companies.

A second key priority was to assess

baseline emissions for the four remaining

high-emitting sectors in our portfolio, as

well as developing a high-level modelled

assessment of our overall balance sheet,

consistent with the approach outlined by

the Partnership for Carbon Accounting

Financials (PCAF). We have announced

new targets for Aviation, Commercial Real

Estate and Agriculture, and published our

first high-level modelled assessment under

PCAF. We have also published our updated

Climate Change Statement which includes

new restrictions on oil and gas financing. In

particular, we will stop directly financing

new oil and gas projects, and have set clear

expectations for our energy clients to

produce transition or decarbonisation

plans and set near-term targets to reduce

emissions.

The final key priority was to refine our

Client Transition Framework so as to

improve our ability to work with clients in

high-emitting sectors on their individual

transition plans. This will allow us to

measure and monitor our clients’

decarbonisation progress and assess the

implications for our targets, and to offer

more tailored support to clients’ transition

requirements.

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|  | Board Sustainability Committee | | | | | | |  |
|  | Nigel Higgins  Chair, Board Sustainability Committee |  |  |  | Committee membership  and meeting attendance in 2023 1 | | |  |
|  | N HIGGINS 0016_Crop_Mint.jpg |  |  |  | Member | Meetings attended/eligible to attend | |  |
|  |  |  |  | Nigel Higgins | | 4/4 |  |
|  |  |  |  | Robert Berry | | 4/4 |  |
|  |  |  |  | Dawn Fitzpatrick | | 3/4 |  |
|  |  |  |  | Mary Francis | | 4/4 |  |
|  |  |  |  | Brian Gilvary | | 2/4 |  |
|  |  |  |  | C.S. Venkatakrishnan | | 4/4 |  |
|  |  |  |  | Julia Wilson | | 4/4 |  |
|  |  |  |  |  |  |  |  |
|  | Note  1 There were four scheduled Committee meetings  held in 2023. Owing to prior commitments, Brian  Gilvary was unable to attend two meetings and Dawn  Fitzpatrick was unable to attend one meeting. | | |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |

The Board has direct oversight of and

responsibility for the Group’s climate and

sustainability strategy. However, given the

importance of this work and the growing

importance of other sustainability areas,

including nature and biodiversity, in March

2023 the Board approved the

establishment of a new Board

Sustainability Committee to support and

advise the Board in its oversight of climate

and sustainability matters.

The Committee receives presentations

into the challenges and opportunities in

this area (including external input on

specific areas of focus), undertakes

detailed reviews and discussions and

makes recommendations to the Board on

key topics. The table on page [182](#i25db8d30af674bad9e37dd02eb19c373_262191) provides

an overview of the Committee’s work in

2023 supporting the Board in overseeing

the activities to meet our climate priorities.

In addition to myself, the members of the

Committee are Robert Berry, Dawn

Fitzpatrick, Mary Francis, Brian Gilvary, C.S.

Venkatakrishnan and Julia Wilson. Tracy

Corrigan also attends Committee

meetings as a non-executive

representative of the BBUKPLC Board.

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|  |  |  |
|  |  |  |
|  | As an Executive member of the Committee, our Group Chief Executive brings  invaluable climate and sustainability insight to the Committee’s discussions,  including the views of key external stakeholders. He is also a member of the UNEP  FI Leadership Council and a member of the CNBC ESG Council, and through those  roles he is able to bring external perspectives of key climate/sustainability matters  to the Committee’s discussions. |  |
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| --- |
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|  |

Having cross-membership on the

Committee with the Chairs of our Board

Audit, Remuneration and Risk Committees,

as well as connectivity with the BBUKPLC

Board, helps to ensure a streamlined

approach to Board-level oversight of all

climate and sustainability related matters.

Committee effectiveness

The results of the Committee

effectiveness review for 2023 confirm the

Committee is operating effectively. It is

considered well constituted and chaired,

providing high-quality oversight and

constructive challenge to management in

the areas within its remit. The review

highlights that the Committee is

considered to have the right level of skills

and experience, including climate/

sustainability expertise, and is of an

appropriate size. The review noted the

benefits of having cross-membership

between the Committee and the Board Risk

Committee and the Board Audit

Committee, and having the Group Chief

Executive as a member of the Committee

in the context of the development of

Barclays’ climate strategy as well as the

skills and experience he brings to the

Committee.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 180 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Sustainability Committee report | | | | | | | | | | |

Feedback indicates that the Committee is

considered to operate at the right level of

debate, and that the allocation of time

between agenda items in Committee

meetings is appropriate, with sufficient time

for discussion and challenge, and focus on

the right matters.

The review concluded that the

Committee’s interaction with the Board,

Board Committees and senior

management is considered effective,

noting that sufficient time is allocated at

Board meetings for the Chair to report to

the Board on the work of the Committee

and to provide feedback on key

sustainability policy matters in support of

the Board’s continued oversight. Feedback

indicated that concurrent meetings of the

BPLC and BBPLC Board Sustainability

Committee are effective, with coverage of

BBPLC matters within concurrent

meetings considered appropriate. The

addition of a representative to the

Committee from the BBUKPLC Board at

the beginning of 2024 was considered to

support ongoing BBUKPLC Board

engagement in respect of sustainability

matters impacting the Group.

Please see the report of the Board

Nominations Committee for further details

on the process for conducting the 2023

Committee effectiveness review.

Looking ahead

Looking ahead to 2024, a key focus for the

Committee will be oversight of

management’s development of Barclays'

transition plan, informed by the work of the

UK's Transition Plan Taskforce, in

conjunction with ongoing work to

implement the Group’s climate strategy by

supporting clients with their transition

plans.

A critical component of the work

undertaken to addressing the climate

challenge is the approach by governments

with respect to climate and sustainability

policy and financing. The importance of

having clear requirements for the

transition, and clarity and consistency in

respect of government policy and

financing, are key in supporting all those

committed to transitioning to a low carbon

economy. This is an area to which the

Committee will have close regard this year.

Finally, as indicated above, nature and

biodiversity are areas of growing

importance on the sustainability agenda.

The Committee is looking forward to

building on the work done in 2023 and the

external briefing it received on this subject

by having a greater focus on the impact of

these areas, including how they can be

reflected in Barclays’ own ambition to be a

net zero bank.

Nigel Higgins

Chair, Board Sustainability Committee

19 February 2024

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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | The role of the Board and its Committees in overseeing climate-related matters | | | | | | | | | | | | | |  |  |
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|  |  | Board | | | | | | | | | | | | |  |  |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Sets and oversees the Group's climate and sustainability strategy | | | | | | | | | | | | |  |  |
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|  |  | Board Audit  Committee |  |  |  | Board Risk  Committee |  |  |  | Board Sustainability  Committee |  |  |  | Board Remuneration  Committee |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | “Best practice and  regulation regarding  climate and sustainability  reporting and related  assurance are still evolving  … and this is an area to  which the Committee will  continue to have close  regard.” |  |  |  | “The Committee...heard  from senior business  leaders about how climate  risks are being integrated  into their business  strategies and plans.” |  |  |  | “In 2023, we continued to  pursue opportunities and  support our clients as they  transition their businesses  to a low-carbon  economy.” |  |  |  | "When we set the  incentive pool and  Executive Directors’  incentive outcomes for  2023, we incorporated  consideration of progress  against our climate  strategy, as we will for  2024." |  |  |
|  |  | Julia Wilson  Chair |  |  |  | Robert Berry  Chair |  |  |  | Nigel Higgins  Chair |  |  |  | Brian Gilvary  Chair |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Considers the impact of  climate on the Group’s  financial statements and  reviews key climate-  related narrative  reporting. |  |  |  | Oversees Barclays’  progress in its climate  risk management  approach, including  a focus on developing  quantitative  risk appetites. |  |  |  | Supports the Board in  its oversight of climate  matters and the  sustainability agenda. |  |  |  | Reflects progress  against climate-related  measures in  remuneration. |  |  |
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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 181 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Sustainability Committee report (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | See the Board Audit  Committee report on  page [166](#i857fd15103294fc381237ff8624656b2_230730). |
|  |

|  |  |
| --- | --- |
|  |  |
| + | See the Board Risk  Committee report on  page [174](#i4be61753b7f243b19551b0bfbf3a2a0d_487). |
|  |

|  |  |
| --- | --- |
|  |  |
| + | See the Board  Sustainability Committee  report on page [180](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686051773). |
|  |

|  |  |
| --- | --- |
|  |  |
| + | See the Remuneration  report on page [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520). |
|  |

Committee composition and

meetings

During 2023, the Committee met four

times and the attendance by members at

these meetings is shown on page [180](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686051773).

Committee meetings were also attended

by representatives from management,

including the Group Head of Public Policy

and Corporate Responsibility, the Group

Head of Sustainability, the Global Head of

Sustainable Finance and the Head of Legal,

Public Policy and Corporate Responsibility.

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|  |  |  |
|  |  |  |
|  | Role of the Committee  The role of the Committee is to provide oversight of climate matters and the  sustainability agenda, and in particular to:  • support and advise the Board on its oversight of climate and sustainability matters  relating to (i) the services and products provided to Barclays’ clients and  customers, (ii) particular sectors, and (iii) its own corporate activities  • support the Board in monitoring the implementation of the Group’s climate and  sustainability strategy  • review and make recommendations to the Board on the suitability of the Group’s  climate and sustainability strategy, position statements, frameworks, ambitions,  metrics, and targets  • report to the Board on the climate and sustainability matters for which it is  responsible, escalating issues and making recommendations to the Board where  appropriate.  The Committee’s terms of reference are available at [home.barclays/who-we-are/](https://home.barclays/who-we-are/our-governance/board-committees/)  [our-governance/board-committees/](https://home.barclays/who-we-are/our-governance/board-committees/) |  |
|  |  |  |

Primary activities

During 2023, the Committee received updates from management in relation to the Group’s climate and sustainability strategy, as well

as internal and external briefings and reports on climate and sustainability matters. Set out below are the key areas of focus for the

Committee's work in 2023.

|  |  |
| --- | --- |
|  |  |
| Areas of focus | Conclusion/action taken |
| Climate and sustainability  strategy | The Committee:  • Considered management's sustainable finance strategy proposals, which focused on the actions required to  accelerate support for our clients as they transition and for the Group to achieve its sustainable financing  target and ambition to be a net zero bank.  • Considered areas where the Group could focus, providing the greatest opportunity to support global  endeavours to transition to a low carbon economy and help the Group achieve its strategic ambitions.  • Reviewed proposals for the Group’s updated oil and gas policy and endorsed new restrictions on oil and gas  financing. |
| Target setting and progress  against targets | The Committee:  • Considered management’s proposals for new targets and endorsed new targets for three additional sectors  – Aviation, Agriculture and Commercial Real Estate.  • Monitored the Group’s progress against its climate and sustainability targets. As part of this, the Committee  received updates on progress towards the target to facilitate $1trn of Sustainable and Transition Financing  by the end of 2030, and considered initiatives that were underway to provide further capability to achieve the  target. |
| Investor feedback | The Committee considered investor feedback and the perspectives of both our institutional investors as well  as our retail shareholder base. During the year, members of the Committee engaged with institutional investors  on climate-related matters, helping inform the development of our climate strategy. |
| Client Transition Framework  (CTF) | The Committee received updates on the Group’s work on the CTF, including management’s approach to  working with clients going through CTF assessments, expected outcomes following the assessments and  proposed expansion of the application of the framework following further targets set by the Group. |
| External briefing: Nature | The Committee received an external briefing on policy and regulatory developments in relation to biodiversity  and nature and the work done by Barclays as part of the UNEP-FI pilot on nature-related risks and opportunities  assessment. |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 182 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Board Sustainability Committee report (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | You can read more about Barclays’ sector targets and  progress against them in the Strategic report on page [89](#i4be61753b7f243b19551b0bfbf3a2a0d_289). |
|  |

|  |  |
| --- | --- |
|  |  |
| + | You can read more about the CTF in the Strategic report  on page [90](#i4be61753b7f243b19551b0bfbf3a2a0d_8287). |
|  |

### Reporting against the Code's principles

### and provisions

As  Barclays PLC is listed on the London Stock Exchange, the principles and provisions of the Code apply, a copy of which can be found

at [frc.org.uk](https://www.frc.org.uk/)

For the year ended 31 December 2023, and as at the date of this report, we are pleased to confirm that Barclays PLC has complied in

full with the requirements of the Code. This section and our Board Governance report sets out how we complied with the Code in 2023.

By virtue of the information included in the Annual Report, we comply with the corporate governance statement requirements of the

FCA’s Disclosure and Transparency Rules (DTRs). The information required to be disclosed pursuant to DTR 7.2.6 is located on pages

[185](#i4be61753b7f243b19551b0bfbf3a2a0d_508) to [190](#if12c0f422fcf4cb1b9f192a343108dff_91934). Information in relation to the Board Diversity and Inclusion Policy, as required to be disclosed pursuant to DTR 7.2.8A, can

be found on pages [158](#id6f86b9feb8d4bb290582a02d22ac8cc_225153) to [160](#id6f86b9feb8d4bb290582a02d22ac8cc_225155).

Barclays is permitted by NYSE rules to follow UK corporate governance practices instead of those applied in the US. Any significant

variations must be explained in Barclays' Form 20-F filing, found at the Securities and Exchange Commission’s EDGAR database or on

our website, [home.barclays](https://home.barclays/)

The way in which Barclays has applied the principles and provisions of the Code during 2023 is summarised below and on the next page.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Board Leadership  and Company Purpose |  |
|  |  |  |
|  | Our Board governance is designed to  deliver an effective and entrepreneurial  Board, which discharges its role effectively  and efficiently. Details can be found on  pages  [150](#i4be61753b7f243b19551b0bfbf3a2a0d_12686) to [152](#i110fbe8b5f02464eac2c7cacd817935c_59467), including our Group-wide  governance framework and the Board's  responsibilities. Key Board activities for  2023 are set out on pages  [153](#i4be61753b7f243b19551b0bfbf3a2a0d_7146825599531) to [155](#i66ff12c94ccf45638f2b03e922fbf213_6-0-1-1-2511538).  The Board is fully supportive of The Barclays  Way , which sets out our Purpose, Values  and Mindset, and is our Code of Conduct,  providing a path for achieving a dynamic and  positive culture in the Group. Refer to page  [245](#i4be61753b7f243b19551b0bfbf3a2a0d_12486) for further detail.  Our Group Whistleblowing Standard  enables colleagues to raise any matters of  concern anonymously and is embedded  into our business. Further information can  be found on page [246](#i62d66d293eac484eb138a917d573357e_3101).  Throughout 2023, we engaged with our  stakeholders through a variety of means.  Refer to page [23](#i4be61753b7f243b19551b0bfbf3a2a0d_10994) of the Strategic report for  further detail about how Barclays engages  with our stakeholders. You can read about  how the Board engages with stakeholders in  our Section 172(1) statement in the  Strategic report from page [38](#i4be61753b7f243b19551b0bfbf3a2a0d_17101) and  examples of the Board's engagement with  colleagues during 2023 can be found on  page [153](#i4be61753b7f243b19551b0bfbf3a2a0d_7146825599531). |  |
|  |  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Division of  Responsibility |  |
|  |  |  |
|  | The majority of the Board comprises  independent Non-Executive Directors.  The Group Chairman and Group Company  Secretary work in collaboration to ensure an  effective and efficient Board, as further  described in Our governance framework  from page [150](#i4be61753b7f243b19551b0bfbf3a2a0d_12686). All Directors have access to  the advice of the Group Company  Secretary.  The roles of Chair, Group Chief Executive,  SID and Non-Executive Directors are  defined within the Barclays Charter of  Expectations , along with the behaviours and  competencies for each role, as outlined on  page [152](#i110fbe8b5f02464eac2c7cacd817935c_59467). Directors are expected to  commit sufficient time to ensure they can  discharge their obligations to Barclays  effectively, as detailed in our Board  Nominations Committee report on  page [161](#id6f86b9feb8d4bb290582a02d22ac8cc_39023).  The Board is responsible for setting the  strategy for the Group. The day-to-day  management of the Group is delegated by  the Board to the Group Chief Executive who  is supported by his ExCo, the composition  of which is outlined on page [149](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686057926).  Details of the number of meetings of the  Board and its Committees, and the  individual attendance by Directors, can be  found in Our governance framework on  page [152](#i110fbe8b5f02464eac2c7cacd817935c_59467) and in each respective Board  Committee report. |  |
|  |  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Composition, Succession  and Evaluation |  |
|  |  |  |
|  | All Board and senior management  appointments are viewed through a diversity  lens and are based on merit and objective  criteria, which focus on the skills and  experience required for the Board's  effectiveness and the delivery of the Group's  strategy.  A revised Board Diversity and Inclusion Policy  was adopted on 8 February 2024. For further  detail, refer to the Board Nominations  Committee report on page [158](#id6f86b9feb8d4bb290582a02d22ac8cc_225152).  Board appointments are made following a  rigorous and transparent process facilitated  by the Board Nominations Committee, with  the aid of external search consultancy firms.  All Directors are subject to annual re-election  at the AGM. See page [185](#i41d6d578edc844e2b2e5cda5034c1261_98449) for further detail.  Each year, we carry out an effectiveness  review to evaluate the performance of the  Board, Board Committees and individual  Directors. In line with the Code, the review  was conducted internally for 2023, and is  expected to be conducted externally in 2024.  Refer to the Board Nominations Committee  report on page [164](#id6f86b9feb8d4bb290582a02d22ac8cc_152440) for details of the 2023  effectiveness review as well as progress  against the findings from the 2022 review. |  |
|  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 183 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: How we comply | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |
|  | Audit, Risk and  Internal Control | | |  |  |  | Remuneration |  |
|  |  |  |  |  |  |  |  |  |
|  | The Board, together with the Board Audit  Committee, is responsible for ensuring the  integrity of this Annual Report and that the  financial statements as a whole present a fair,  balanced and understandable assessment of  Barclays' performance, position and  prospects.  The Board, together with the Board Audit  Committee, is responsible for ensuring the  independence and effectiveness of the  internal audit function and external auditors.  The Directors are responsible for ensuring  that management maintains an effective  system of risk management and internal  control and for assessing its effectiveness.  Such a system is designed to identify,  evaluate and manage, rather than eliminate,  the risk of failure to achieve business  objectives and can only provide reasonable,  and not absolute, assurance against material  misstatement or loss.  Processes are in place for identifying,  evaluating and managing the Principal Risks  facing the Group. A key component of The  Barclays Guide is the ERMF. The purpose of  the ERMF is to identify and set minimum  requirements of the main risks to the  strategic objectives of the Group. |  | The Group is committed to operating within  a strong system of internal control. The  Barclays Guide contains the overarching  framework setting out the approach of the  Group to internal governance.  Key controls are assessed on a regular basis  for both design and operating effectiveness.  Issues arising out of these assessments,  where appropriate, are reported to the  Board Audit Committee.  The Board Audit Committee oversees the  control environment (and remediation of  related issues). It also reviews annually the  risk management and internal control  system.  The Board Audit Committee has concluded  that throughout the year ended 31  December 2023 and to date, the Group has  operated an effective system of internal  control that provides reasonable assurance  of financial and operational controls and  compliance with laws and regulations.  You can read more about the Board Audit  Committee and its work, including its  oversight of the internal control framework  and areas of ongoing enhancement, from  page [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520). |  |  |  | The Remuneration report from page [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520)  sets out the purpose and activities of the  Board Remuneration Committee, a  summary of the remuneration policy for the  Executive Directors and how it is aligned  with the policy for the wider workforce, as  well as the Directors’ remuneration  outcomes for 2023.  The remuneration policies and procedures  support the Group's strategy and enable us  to reward sustainable performance, which is  a key element of our Remuneration  Philosophy, in line with our Values, Mindset  and risk expectations.  All Executive Director and senior  management remuneration policies are  developed in accordance with the Group's  formal and transparent procedures  (ensuring that no Director is involved in  deciding their own remuneration outcome)  and are, where possible, aligned to wider  workforce policies.  Board Remuneration Committee members  exercise independent judgement and  discretion when determining remuneration  outcomes, considering the company and  individual performance, wider workforce  and other relevant stakeholder  considerations. |  |
|  |  |  |  |  |  |  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 184 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: How we comply (continued) | | | | | | | | | | |

#### The Directors present their report together with the audited

#### accounts for the year ended 31 December 2023.

Other statutory and

### regulatory information

|  |  |
| --- | --- |
|  |  |
| Other information that is relevant to the Directors’ report, and which is incorporated by  reference into this report, can be located as follows: | |
|  | Page |
| Remuneration policy, including details of the remuneration of each Director and  Directors’ interests in shares | [201](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686053725), [207](#i8958dfd3d5354840a56a1ffea7aeb8fe_320811),  [225](#i4be61753b7f243b19551b0bfbf3a2a0d_547) to  [227](#ib01da1214883469b9277e40a6a94babb_109090) |
| Corporate Governance Statement | [183](#i4be61753b7f243b19551b0bfbf3a2a0d_493) to [184](#i4be61753b7f243b19551b0bfbf3a2a0d_496) |
| Risk review | [254](#i4be61753b7f243b19551b0bfbf3a2a0d_580) |

|  |  |
| --- | --- |
|  |  |
| Disclosures required pursuant to Large and Medium-sized Companies and Groups (Accounts and  Reports) Regulations 2008 as updated by Companies (Miscellaneous Reporting) Regulations 2018  can be found on the following pages: | |
|  | Page |
| Engagement with employees (Sch. 7, Para 11 and 11A 2008/2018 Regs) | [27](#i57cc5612cb4544d591df3020a106622d_96403) to  [29](#i20ee8c6fe6664d3990aede1709d1ef59_1-1-1-1-2196888) |
| Engagement with suppliers, customers and others in a business relationship (Sch.  7, Para 11 B 2008/2018 Regs) | [24](#i735d6107ec704dde96738f6400db244b_102760) to  [26](#ibbf817da39c2484a987f90df3c4aad1b_1-1-1-1-2196881) ,  [30](#i841004e2fbaa4d1d9555ef0fab534d50_255167)  to  [33](#i2a7098f2c0af4871ab483e7bc0ad1e02_1-1-1-1-2196891)  and  [238](#i4be61753b7f243b19551b0bfbf3a2a0d_172) to [244](#i4be61753b7f243b19551b0bfbf3a2a0d_17416) |
| Financial instruments (Sch. 7, para 6 2008 Regs) | [441](#i4be61753b7f243b19551b0bfbf3a2a0d_952) |
| Hedge accounting policy (Sch. 7, para 6 2008 Regs) | [441](#i4be61753b7f243b19551b0bfbf3a2a0d_952) |

|  |  |
| --- | --- |
|  |  |
| Disclosures required pursuant to Listing Rule 9.8.4R can be found on the following pages: | |
|  | Page |
| Allotment for cash of equity securities | [477](#i4be61753b7f243b19551b0bfbf3a2a0d_997) |
| Waiver of dividends | [185](#i4be61753b7f243b19551b0bfbf3a2a0d_508) |

Sectio n 414A of the Companies Act 2006

requires the Directors to present a

Strategic report in the Annual Report and

Financial Statements. This report can be

found on pages [3](#i4be61753b7f243b19551b0bfbf3a2a0d_40) to [55](#i6127f61949ef438ca49641294c729b45_27960).

The Company has chosen, in accordance

with section 414C(11) of the Companies

Act 2006, and as noted in this Directors’

report, to include certain matters in its

Strategic report that would otherwise be

disclosed in this Directors’ report:

• an indication of likely future

developments may be found in the

Strategic report

• the particulars of important events

affecting the Company since the

financial year end can be found in the

Strategic report and Note 25 (Legal,

competition and regulatory matters) to

the financial statements.

|  |
| --- |
|  |
|  |

Profit and dividends

Statutory profit after tax for 2023 was

£5,323m (2022: £5,973m). The 2023 full

year dividend of 5.3p per ordinary share will

be paid on 3 April 2024 to shareholders

whose names are on the Register of

Members at the close of business on 1

March 2024. With the 2023 half year

dividend totalling 2.7p per ordinary share,

paid in September 2023, the total dividend

for 2023 is 8.0p (2022: 7.25p) per ordinary

share. The half year and full year dividends

for 2023 amounted to £1,210m (2022:

£1,028m). BPLC also completed share

buy-back programmes during 2023,

further details of which can be found later

in this section.

Shareholders may have their dividends

reinvested in Barclays by joining the

Barclays Dividend Reinvestment Plan

(DRIP). Further details regarding the DRIP

can be found at [home.barclays/dividends](https://home.barclays/investor-relations/shareholder-information/dividends/)

and [shareview.co.uk/info/drip](https://www.shareview.co.uk/4/Info/Portfolio/Default/en/Home/Pages/Home.aspx)

The nominee company of certain

Employee Benefit Trusts (EBTs) holding

shares in Barclays in connection with the

operation of our employee share plans has

lodged evergreen dividend waivers on

shares held by it that have not been

allocated to employees. The total amount

of dividends waived during the year ended

31 December 2023 was £1.70m (2022:

£6.28m).

Board of Directors

The names of the current Directors of

BPLC, along with their biographical details,

are set out on pages [145](#ife5003b89811499dabdd197479852bb9_1-1-2-2-1841111) to [148](#i4ffc8b21a2004984a69a097ac1c5c011_1-1-2-2-1841111) and are

incorporated into this Directors’ report by

reference. Changes to Directors during

the year and up to the date of this report

are set out below.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Name | Role | Effective  date |
| Marc Moses | Non-  Executive  Director | Appointed  23 January  2023 |
| Mike Ashley | Non-  Executive  Director | Resigned 3  May 2023 |
| Crawford  Gillies | Non-  Executive  Director | Resigned 31  May 2023 |
| Sir John  Kingman | Non-  Executive  Director | Appointed 1  June 2023 |

Appointment and retirement of

Directors

The appointment and retirement of

Directors is governed by our Articles, the

Code, the Companies Act 2006 and

related legislation.

The Articles may be amended only by a

special resolution of the shareholders. The

Board has the power to appoint additional

Directors or to fill a casual vacancy among

the Directors and any Director so

appointed holds office only until the next

AGM and may offer themselves for re-

election. The Code recommends that all

directors of FTSE 350 companies should

be subject to annual re-election. All

Directors intend to offer themselves for

election or re-election at the 2024 AGM.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 185 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Directors’ report: Other statutory and regulatory information | | | | | | | | | | |

Directors’ indemnities

Qualifying third party indemnity provisions

(as defined by Section 234 of the

Companies Act 2006) were in force during

the course of the financial year ended

31 December 2023 for the benefit of the

then Directors of the Company and the

then Directors of certain of the Company's

subsidiaries and, at the date of this report,

are in force for the benefit of the Directors

of the Company and the directors of

certain of the Company's subsidiaries in

relation to certain losses and liabilities

which they may incur (or have incurred) in

connection with their duties, powers or

office. The Group also maintains Directors’

and Officers’ Liability Insurance which gives

appropriate cover for legal action brought

against its Directors.

Qualifying pension scheme indemnity

provisions (as defined by Section 235 of

the Companies Act 2006) were in force

during the course of the financial year

ended 31 December 2023 for the benefit

of the then Directors, and at the date of

this report are in force for the benefit of

directors of Barclays Pension Funds

Trustees Limited as trustee of the Barclays

Bank UK Retirement Fund, and Barclays

Executive Schemes Trustees Limited as

Trustee of Barclays Capital International

Pension Scheme (No.1) and Barclays PLC

Funded Unapproved Retirement Benefits

Scheme. The directors of the trustees are

indemnified against liability incurred in

connection with the trustees’ activities in

relation to the Barclays Bank UK

Retirement Fund, Barclays Capital

International Pension Scheme (No.1) and

Barclays PLC Funded Unapproved

Retirement Benefits Scheme.

Political donations

The Group did not give any money for

political purposes in the UK or outside the

UK, nor did it make any political donations

to political parties or other political

organisations or to any independent

election candidates, nor did it incur any

political expenditure during the year. In

accordance with the US Federal Election

Campaign Act, Barclays provides

administrative support to a federal Political

Action Committee (PAC) in the US, funded

by the voluntary political contributions of

eligible employees.

The PAC is not controlled or funded by

Barclays and all decisions regarding the

amounts and recipients of contributions

are directed by a steering committee

comprising employees eligible to

contribute to the PAC.

Contributions to political organisations

reported by the PAC during the calendar

year 2023 totalled $60,159 (2022:

$105,000).

Country-by-Country reporting

The Capital Requirements (Country-by-

Country reporting) Regulations 2013

require the Company to publish additional

information in respect of the year ended

31 December 2023. This information is

included in the Barclays Country Snapshot

available on the Barclays website:

[home.barclays/annualreport](https://home.barclays/investor-relations/reports-and-events/annual-reports/)

Support for candidates and colleagues

with disabilities and long-term

conditions

Barclays is committed to attracting and

retaining a diverse workforce, and our

commitment to inclusion means we want

to ensure that candidates with disabilities

and long-term health conditions receive

support and adjustments in the application

process and beyond. Barclays welcomes

applications from all candidates and is

committed to ensuring reasonable

adjustments (accommodations) are put in

place to ensure a fair and inclusive

recruitment process. Barclays is

committed to providing all colleagues with

the support and tools they need to have a

productive and fulfilling career. We can

consider making adjustments to remove

or reduce barriers colleagues might face if

they have a disability, health concern or

mental health condition We also ensure

opportunities for training, career

development and promotion are available

to all.

Research and development

In the ordinary course of business, the

Group develops new products and services

in each of its business divisions.

Greenhouse gas emissions,

energy consumption and energy

efficiency action

Although financed emissions account for

the greatest proportion of our climate

impact, we have also continued addressing

our operational emissions – an important

factor in meeting our ambition to be a net

zero bank by 2050.

Progress to date

In 2023 we achieved our milestone1 of

50% reduction of our Scope 1 and 2

location-based GHG emissions ahead of

2030 – reducing these emissions by 51%Δ.

We continued to source 100% renewableΔ

electricity2 for our global real estate

portfolio3 and continued to meet our 90%

Scope 1 and 2 market-based emissions

reduction target4 – reducing these

emissions by 93%Δ.

Key contributors to our progress include

global real estate portfolio right-sizing5

and energy efficiency programmes, as well

as company vehicles electrification, and

our continued focus on renewable

electricity sourcing.

For our Scope 3 operational emissions our

focus remained on engaging with our key

stakeholders and making data

enhancements, particularly by acquiring

primary supplier data and evolving our

accounting methodology in line with

industry standards and best practice. We

also continued to pursue the integration of

ESG considerations and expectations into

processes throughout the procurement

lifecycle.

We expect that our progress against our

net zero operations targets and

milestones is likely to be variable and non-

linear. Our net zero operations strategy is

dependent on broader industry,

technological and regulatory changes that

are outside Barclays’ control and may

affect our ability to achieve our targets and

milestones. Further, as the accounting

standards and data underlying our net zero

operations strategy continue to evolve

and be refined, this could impact our

metrics, targets and milestones.

Note

Δ    2023 data subject to independent limited assurance

under ISAE (UK) 3000 and ISAE 3410. Current limited

assurance scope and opinion can be found within the

ESG Resource Hub: [home.barclays/sustainability/esg-](home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)

[resource-hub/reporting-and-disclosures/](home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)

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| Directors’ report: Other statutory and regulatory information (continued) | | | | | | | | | | |

Progress against our targets and

milestones may also be impacted by

management decisions based on key

drivers unrelated to climate, for example

prudent risk management practices. Our

intent is to enhance data collection and

accuracy to help identify key contributors

to our impact, determine opportunities for

improvement, and support the integration

of sustainability into our business

operations.

These measures build on those taken

during 2022 to implement our net zero

operations strategy. Further information is

available on page 191 of the Barclays PLC

Annual Report 2022.

We have disclosed global GHG emissions

and energy use data as required by the

Large and Medium-sized Companies and

Groups (Accounts and Reports) Regulations

2008. See the ESG Data Centre for further

details on our annual operational GHG

emissions since 2018, including our Scope 1,

Scope 2 (location and market based) and

Scope 3 operational emissions. We further

provide insights on our annual waste

production, energy, water consumption and

renewable electricity consumption by

region. For further information about

Barclays’ net zero operations strategy, see

page [73](#i4be61753b7f243b19551b0bfbf3a2a0d_262) of the Barclays PLC Annual

Report 2023.

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| + | The ESG Data Centre within the ESG Resource Hub  can be found  at [home.barclays/sustainability/esg-](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures)  [resource-hub/reporting-and-disclosures](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures) |
|  |

Notes

1 In this section, a reference to a 'milestone' denotes an

indicator we are working towards and report against.

2 We maintained 100% renewable electricity sourcing for

our global real estate portfolio through instruments

including green tariffs (55%) and energy attribute

certificates (EACs)(45%).

3 Global real estate portfolio includes offices, branches,

campuses and data centres.

4 In this section, a reference to a 'target' denotes an

indicator linked to our executive remuneration.

5 By right-sizing we are optimising our space and

associated resources for our operational needs.

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| GHG Emissions Table and Notes | | | | |
|  | Current Reporting Year  2023 1 | | Previous Reporting Year  2022 | |
|  | UK &  Offshore Area | Global  GHG Emissions | UK &  Offshore Area | Global  GHG Emissions |
| Group Operational GHG Emissions2  (tCO2 e) |  |  |  |  |
| Total Scope 1, Scope 2 location-based, Scope 3 operational GHG emissions (000'  tonnes) | 91.6 | 183.5 | 94.8 | 177.2 |
| Scope 1 CO2 e emissions (000' tonnes) 3 | 9.4 | 15.3Δ | 12.8 | 20.2 |
| Scope 2 location-based CO2 e emissions (000' tonnes) 4 | 35.7 | 87.2Δ | 47.3 | 99.8 |
| Scope 3 CO2 e emissions (000' tonnes) 5 | 46.5 | 81.0 | 34.7 | 57.2 |
| Category 3 Fuel and Energy Related Activities CO2e emissions (000' tonnes) | 12.9 | 13.4Δ | 14.7 | 15.7 |
| Category 5 Business Waste in Operations CO2e emissions (000' tonnes) | 0.19 | 0.36Δ | 0.21 | 0.35 |
| Category 6 Business Travel CO2e emissions (000' tonnes) | 15.3 | 39.5Δ | 9.0 | 19.9 |
| Category 8 Upstream Leased Assets CO2e emissions (000' tonnes) | 18.1 | 27.0Δ | 10.8 | 20.7 |
| Category 13 Downstream Leased Assets CO2e emissions (000' tonnes) | 0 | 0.72Δ | 0 | 0.57 |
|  |  |  |  |  |
| Energy consumption used to calculate operational GHG emissions (MWh) | 208,564 | 375,087Δ | 285,874 | 463,973 |
| Intensity Ratio |  |  |  |  |
| Total Full-Time Employees (FTE) | 45,300 | 92,900 | 44,000 | 87,400 |
| Total CO2 e per FTE (tonnes) 6 | 2.02 | 1.97Δ | 2.15 | 2.03 |
| Market-based emissions |  |  |  |  |
| Scope 2 market-based CO2 e emissions (000' tonnes) 7 | 0 | 1.6Δ | 0 | 2.0 |
| Total Scope 1 and 2 market-based CO2 e emissions (000' tonnes) | 9.4 | 16.9 | 12.8 | 22.1 |

Notes

1 The carbon reporting year for our GHG emissions is 1 October to 30 September. The carbon reporting year is not fully aligned to the financial reporting year covered by this Directors’

report. Details of our approach to assurance over the data is set out in the 2023 Barclays Strategic report.

2 The methodology used to calculate our GHG emissions follows the 'Greenhouse Gas Protocol (GHG): A Corporate Accounting and Reporting Standard (Revised Edition)', defined by the

World Resources Institute/World Business Council for Sustainable Development. We have adopted the operational control approach to define our reporting boundary. For 2023, we

have applied the latest emission factors as of 31 December 2023. Reported emissions for Scope 2 location and market-based have been recalculated back to the 2018 baseline, due to

updated internal and external data. The associated emissions have also been re-classified from Scope 2 electricity to Scope 3 Category 8 (Upstream Leased Assets) as these emissions

are currently outside of our operational control. In 2022 we reported Scope 2 location-based emissions of 103,422 tCo2e; the recalculated figure is 99,782 tCO2e. In 2022 we reported

Scope 2 market-based emissions of 1,883 tCo2e; the recalculated figure is 1,963 tCO2e. In 2022 we reported energy use of 467,939 MWh; the recalculated figure is 463,973 MWh.

3 Scope 1 emissions include our direct GHG emissions from natural gas, fuel oil, company cars and HFC refrigerants. In the case of company-owned vehicles, emissions are limited to UK

vehicles only as this is the only country in which expense data is available.

4 Scope 2 GHG emissions include our indirect GHG emissions from purchased electricity, purchased heat, cooling and steam . Market-based emissions have been reported for 2023 and

2022. We have used a zero emission factor where we have green tariffs or energy attribute certificates in place globally.

5 Scope 3 category 1, 2 and 4 emissions are excluded as these emissions cannot be broken down by country. Scope 3 category 1, 2 and 4 emissions can be found in the Operational

Footprint tab of the ESG Data Centre.

6  Intensity ratio calculations have been calculated using location-based emission factors only.

7 Energy consumption data is captured through utility billing; meter reads or estimates. Principal measures we have undertaken in 2023 to improve energy efficiency include the following:

• Right-sized our global real estate portfolio, therefore optimising our space and associated resources for our operational needs.

• Deployed our global energy optimisation programme by adjusting corporate offices' settings and systems during periods of low or no occupancy to reduce our demand for energy

while keeping our buildings running. In 2023 the programme contributed to approximately 9.1 GWh in energy savings at our UK sites – equivalent to the annual electricity

consumption of approximately 2,600 UK households.

Δ  2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current and previous limited assurance scope and opinions can be found within the ESG

Resource Hub for further details: [home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/](https://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)

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| Directors’ report: Other statutory and regulatory information (continued) | | | | | | | | | | |

Share capital

Share capital structure

The Company has ordinary shares in issue.

The Company’s Articles also allow for the

issuance of sterling, US dollar, euro and

yen preference shares (preference

shares). No preference shares have been

issued as at 16 February 2024 (the latest

practicable date for inclusion in this report).

Ordinary shares therefore represent 100%

of the total issued share capital as at

31 December 2023 and as at 16 February

2024 (the latest practicable date for

inclusion in this report).

Details of the movement in ordinary share

capital during the year can be found in

Note 27 to the financial statements.

The rights and obligations attaching to the

Company's ordinary shares and

preference shares are set out in the

Company's Articles, copies of which are

available on the Company's website at

[home.barclays/corporategovernance](https://home.barclays/who-we-are/our-governance/)

Voting

Every member who is present in person or

represented at any general meeting of the

Company, and who is entitled to vote, has

one vote on a show of hands. Every proxy

present has one vote. The proxy will have

one vote for, and one vote against, a

resolution if he/she has been instructed to

vote for, or against, the resolution by

different members or in one direction by a

member while another member has

permitted the proxy discretion as to how

to vote.

On a poll, every member who is present in

person or by proxy and who is entitled to

vote has one vote for every share held. In

the case of joint holders, only the vote of

the senior holder (as determined by the

order in the share register) or his/her proxy

may be counted. If any sum payable

remains unpaid in relation to a member’s

shareholding, that member is not entitled

to vote that share or exercise any other

right in relation to a meeting of the

Company unless the Board otherwise

determines.

If any member, or any other person

appearing to be interested in any of the

Company’s ordinary shares, is served with

a notice under Section 793 of the

Companies Act 2006 and does not supply

the Company with the information

required in the notice, then the Board, in its

absolute discretion, may direct that that

member shall not be entitled to attend or

vote at any meeting of the Company.

The Board may further direct that, if the

shares of the defaulting member

represent 0.25% or more of the issued

shares of the relevant class, dividends or

other monies payable on those shares

shall be retained by the Company until the

direction ceases to have effect and no

transfer of those shares shall be registered

(other than certain specified ‘excepted

transfers’). A direction ceases to have

effect seven days after the Company has

received the information requested, or

when the Company is notified that an

excepted transfer of all of the relevant

shares to a third party has occurred, or as

the Board otherwise determines.

Transfers

Ordinary shares may be held in either

certificated or uncertificated form.

Certificated ordinary shares may be

transferred in writing in any usual or other

form approved by the Group Company

Secretary and executed by or on behalf of

the transferor. Transfers of uncertificated

ordinary shares must be made in

accordance with the Companies Act 2006

and the CREST Regulations.

The Board is not bound to register a

transfer of partly paid ordinary shares or

fully paid shares in exceptional

circumstances approved by the FCA.

The Board may also decline to register an

instrument of transfer of certificated

ordinary shares unless (i) it is duly stamped,

deposited at the prescribed place and

accompanied by the share certificate(s)

and such other evidence as reasonably

required by the Board to evidence right to

transfer, (ii) it is in respect of one class of

shares only, and (iii) it is in favour of a single

transferee or not more than four joint

transferees (except in the case of

executors or trustees of a member).

The Company is not aware of any

agreements between holders of securities

that may result in restrictions on the

transfer of securities or voting rights.

Variation of rights

The rights attached to any class of shares

may be varied either with the consent in

writing of the holders of at least 75% in

nominal value of the issued shares of that

class, or with the sanction of a special

resolution passed at a separate meeting of

the holders of the shares of that class. The

rights of shares shall not (unless expressly

provided by the rights attached to such

shares) be deemed varied by the creation

of further shares ranking equally with them

or subsequent to them.

Limitations on foreign shareholders

There are no restrictions imposed by the

Articles or (subject to the effect of any

economic sanctions that may be in force

from time to time) by current UK laws

which relate only to non-residents of the

UK and which limit the rights of such non-

residents to hold or (when entitled to do

so) vote the ordinary shares.

Exercisability of rights under an

employee share scheme

EBTs operate in connection with certain of

the Group’s Employee Share Plans (Plans).

The trustees of the EBTs may exercise all

rights attached to the shares in

accordance with their fiduciary duties,

other than as specifically restricted in the

documents governing the Plans. The

trustees of the EBTs have informed the

Company that their normal policy is to

abstain from voting in respect of the

Barclays shares held in trust. The trustees

of the Global Sharepurchase EBT and UK

Sharepurchase EBT may vote in respect of

Barclays shares held in the EBTs, but only

as instructed by participants in those Plans

in respect of their partnership shares and

(when vested) matching and dividend

shares. The trustees will not otherwise

vote in respect of shares held in the

Sharepurchase EBTs.

Special rights

There are no persons holding securities

that carry special rights with regard to the

control of the Company.

Major shareholders

Major shareholders do not have different

voting rights from those of other

shareholders. Information provided to the

Company by substantial shareholders

(holding voting rights of 3% or more in the

financial instruments of the Company)

pursuant to the DTRs are published via a

Regulatory Information Service and is

available on the Company’s website. As at

31 December 2023, the Company had

been notified under Rule 5 of the DTRs of

the following holdings of voting rights in

its shares.

Between 31 December 2023 and

16 February 2024 (the latest practicable

date for inclusion in this report), the

Company has not received any additional

notifications pursuant to Rule 5 of

the DTRs.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Person interested | Number of  Barclays Shares | % of total voting rights attaching to  issued share capital 1 | Nature of holding (direct or  indirect) |
| BlackRock, Inc.2 | 944,022,209 | 5.78 | indirect |

Notes

1 The percentage of voting rights detailed above was calculated at the time of the relevant disclosures made in accordance with Rule 5 of the DTRs.

2 Total shown includes 6,687,206 contracts for difference to which voting rights are attached. Part of the holding is held as American Depositary Receipts. On 25 January 2024, BlackRock, Inc.

disclosed by way of a Schedule 13G filed with the SEC beneficial ownership of 1,303,920,163 ordinary shares of the Company as at 31 December 2023, representing 8.6% of that class of shares.

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| Directors’ report: Other statutory and regulatory information (continued) | | | | | | | | | | |

Powers of Directors to issue and allot or

buy back the Company’s shares

The powers of the Directors are

determined by the Companies Act 2006

and the Company’s Articles. The Directors

are authorised to issue and allot shares

and to buy back shares subject to, and on

the terms of, the annual shareholder

approval at the AGM. Such authorities

were granted by shareholders at the 2023

AGM. It will be proposed at the 2024 AGM

that the Directors be granted new

authorities to issue and allot and buy back

shares.

Repurchase of shares

On 13 March 2023 and 28 July 2023 the

Company commenced share buy-back

programmes to purchase its ordinary

shares of £0.25p each up a maximum

consideration of £500m and £750m,

respectively. The first share buy-back

programme concluded on 14 April 2023

and the second share buy-back

programme concluded on 23 October

2023. The Company repurchased for

cancellation 343,041,720 ordinary shares

at a volume weighted average price of

145.7549 pence per ordinary share during

the first buy-back programme and

493,603,770 ordinary shares at a volume

weighted average price of 151.9437 pence

per ordinary share during the second buy-

back programme. The purpose of the buy-

back programmes was to reduce the

Company’s number of outstanding

ordinary shares.

In aggregate, the Company purchased

836,645,490 ordinary shares during 2023

with an aggregate nominal value of

approximately £209m (this represented

approximately 5.5% of the Company's

issued share capital as at 31 December

2023) for an aggregate consideration of

£1,250m excluding taxes and expenses.

All of the repurchased ordinary shares

have been cancelled.

No further shares have been repurchased

since the completion of the second share

buy-back programme on 23 October

2023. The maximum number of ordinary

shares which could be repurchased by the

Company as part of any share buy-back

under the authority for on-market share

buy-backs granted at the 2023 AGM is

1,093,533,143 ordinary shares (being

1,587,136,913 less the 493,603,770

shares repurchased as part of the second

share buy-back programme).

Distributable reserves

As at 31 December 2023, the distributable

reserves of the Company were £21,162m

(2022: £21,701m).

Change of control

There are no significant agreements to

which the Company is a party that take

effect, alter or terminate on a change of

control of the Company following a

takeover bid. There are no agreements

between the Company and its Directors or

employees providing for compensation for

loss of office or employment that occurs

because of a takeover bid.

Controls over financial reporting

A framework of disclosure controls and

procedures is in place to support the

approval of the financial statements of the

Group.

Specific governance committees are

responsible for examining the financial

reports and disclosures to help ensure that

they have been subject to adequate

verification and comply with applicable

standards and legislation.

Where appropriate, these committees

report their conclusions to the Board Audit

Committee, which debates such

conclusions and provides further

challenge. Finally, the Board scrutinises and

approves results announcements and the

Annual Report to ensure that appropriate

disclosures have been made. This

governance process is designed to ensure

that both management and the Board are

given sufficient opportunity to debate and

challenge the financial statements of the

Group and other significant disclosures

before they are made public.

Management’s report on internal control

over financial reporting

Management is responsible for

establishing and maintaining adequate

internal control over financial reporting

under the supervision of the principal

executive and financial officers, to provide

reasonable assurance regarding the

reliability of financial reporting and the

preparation of financial statements, in

accordance with (a) UK-adopted

international accounting standards; and (b)

International Financial Reporting

Standards (IFRS) as issued by the

International Accounting Standards Board

(IASB), including interpretations issued by

the IFRS Interpretations Committee.

Internal control over financial reporting

includes policies and procedures that

pertain to the maintenance of records

that, in reasonable detail:

• accurately and fairly reflect transactions

and dispositions of assets

• provide reasonable assurances that

transactions are recorded as necessary

to permit preparation of financial

statements in accordance with UK-

adopted international accounting

standards and IFRS and that receipts

and expenditures are being made only in

accordance with authorisations of

management and the respective

Directors

• provide reasonable assurance regarding

prevention or timely detection of

unauthorised acquisition, use or

disposition of assets that could have a

material effect on the financial

statements.

Internal control systems, no matter how

well designed, have inherent limitations

and may not prevent or detect

misstatements. Also, projections of any

evaluation of effectiveness to future

periods are subject to the risk that internal

control over financial reporting may

become inadequate because of changes in

conditions or that the degree of

compliance with the policies or procedures

may deteriorate.

Management has assessed internal

control over financial reporting as at 31

December 2023. In making its

assessment, management utilised the

criteria set out in the 2013 COSO

framework. Management has concluded

that, based on its assessment, internal

control over financial reporting was

effective as at 31 December 2023.

The system of internal financial and

operational controls is also subject to

regulatory oversight in the UK and

overseas. Further information on

supervision by financial services regulators

is provided under Supervision and

Regulation in the Risk review section on

pages [363](#i4be61753b7f243b19551b0bfbf3a2a0d_802) to [372](#i7d14e033e5b94859948b1dda818e15c5_653668).

Changes in internal control over financial

reporting

There have been no changes that

occurred during the period covered by this

report, which have materially affected or

are reasonably likely to materially affect the

Group’s internal control over financial

reporting.

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| Directors’ report: Other statutory and regulatory information (continued) | | | | | | | | | | |

Disclosure of information to the auditor

Each Director confirms that, so far as he/

she is aware, there is no relevant audit

information of which our auditor is

unaware and that each of the Directors

has taken all the steps that he/she ought

to have taken as a Director to make

himself/herself aware of any relevant audit

information and to establish that our

auditor is aware of that information. This

confirmation is given pursuant to Section

418 of the Companies Act 2006 and

should be interpreted in accordance with,

and subject to, those provisions.

Directors’ responsibilities

The following statement, which should be

read in conjunction with the Auditor’s

report set out on pages [396](#i4be61753b7f243b19551b0bfbf3a2a0d_871) to [412](#i2721d0ea60414affb9c1022cd6bf5906_55816), is

made with a view to distinguishing for

shareholders the respective

responsibilities of the Directors and of the

auditor in relation to the accounts.

Going concern

The Group’s business activities and factors

likely to affect its future development and

performance are disclosed in the Strategic

report and Risk review sections of this

report. The financial performance is

disclosed within the Financial review with

funding, liquidity and capital details

contained within the Risk performance

section. The Group’s objectives and

policies in managing the financial risks to

which it is exposed are discussed in the

Risk management section.

The Directors considered it appropriate to

prepare the financial statements on a

going concern basis.

In preparing each of the Group and

company financial statements, the

Directors are required to:

• assess the Group and Company’s ability

to continue as a going concern,

disclosing, as applicable, matters related

to going concern

• use the going concern basis of

accounting unless they either intend to

liquidate the Group or the Parent

company or to cease operations, or

have no realistic alternative but to do so.

Preparation of accounts

The Directors are required by the

Companies Act 2006 to prepare Group

and Company accounts for each financial

year and, with regard to Group accounts, in

accordance with UK-adopted international

accounting standards. The Directors have

prepared these accounts in accordance

with (a) UK-adopted international

accounting standards; and (b) IFRS as

issued by the IASB, including

interpretations issued by the IFRS

Interpretations Committee. Pursuant to

the Companies Act 2006, the Directors

must not approve the accounts unless

they are satisfied that they give a true and

fair view of the state of affairs of the Group

and the Company and of their profit or loss

for that period.

The Directors consider that, in preparing

the financial statements, the Group and

the Company have used appropriate

accounting policies, supported by

reasonable judgements and estimates,

and that all accounting standards which

they consider to be applicable have been

followed.

The Directors are satisfied that the Annual

Report and financial statements, taken as a

whole, are fair, balanced and

understandable, and provide the

information necessary for shareholders to

assess the Group and Company’s position

and performance, business model and

strategy.

The Directors are responsible for such

internal controls as they determine are

necessary to enable the preparation of

financial statements that are free from

material misstatement, whether due to

fraud or error.

Directors’ responsibility statement

The Directors have responsibility for

ensuring that the Company and the Group

keep accounting records which disclose

with reasonable accuracy the financial

position of the Company and the Group

and which enable them to ensure that the

accounts comply with the Companies Act

2006.

The Directors are also responsible for

preparing a Strategic report, Directors’

report, Directors’ remuneration report and

Corporate Governance Statement in

accordance with applicable law and

regulations.

The Directors are responsible for the

maintenance and integrity of the Annual

Report and Financial Statements as they

appear on our website. Legislation in the

UK governing the preparation and

dissemination of financial statements may

differ from legislation in other jurisdictions.

The Directors have a general responsibility

for taking such steps as are reasonably

open to them to safeguard the assets of

the Group and to prevent and detect fraud

and other irregularities.

The Directors, whose names and functions

are set out on pages [145](#ife5003b89811499dabdd197479852bb9_1-1-2-2-1841111) to [148](#i4ffc8b21a2004984a69a097ac1c5c011_1-1-2-2-1841111), confirm

to the best of their knowledge that:

(a) the financial statements, prepared in

accordance with (i) UK-adopted

international accounting standards; and (ii)

IFRS as issued by the IASB, including

interpretations issued by the IFRS

Interpretations Committee, give a true and

fair view of the assets, liabilities, financial

position and profit or loss of the Company

and the undertakings included in the

consolidation taken as a whole; and

(b) the management report, on pages [4](#i4be61753b7f243b19551b0bfbf3a2a0d_62672162794689) to

[58](#i4be61753b7f243b19551b0bfbf3a2a0d_238), which is incorporated in the Directors’

report, includes a fair review of the

development and performance of the

business and the position of the Company

and the undertakings included in the

consolidation taken as a whole, together

with a description of the Principal Risks and

uncertainties that they face.

Auditor’s report

The Auditor’s report on the Financial

Statements of Barclays PLC for the year

ended 31 December 2023 was unmodified

and its statement under Section 496 of the

Companies Act 2006 was also unmodified.

By order of the Board

Hannah Ellwood

Group Company Secretary

19 February 2024

Registered in England.

Company No. 48839

Registered office: 1 Churchill Place,

London E14 5HP

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| Directors’ report: Other statutory and regulatory information (continued) | | | | | | | | | | |

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| Annual statement from the Chair of  the Board Remuneration Committee |

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| Contents | |
| Annual statement | [191](#i4be61753b7f243b19551b0bfbf3a2a0d_155031139533387) |
| Executive Director remuneration  outcomes at a glance | [195](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686057702) |
| Wider workforce remuneration | [197](#i4be61753b7f243b19551b0bfbf3a2a0d_15379) |
| Directors’ Remuneration Policy | [201](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686053725) |
| Annual report on Directors’  remuneration | [207](#i4be61753b7f243b19551b0bfbf3a2a0d_541) |

Dear fellow shareholders

On behalf of the Board, I am pleased to

present the Remuneration report for 2023.

Over the next few pages, we set out our

key considerations and the remuneration

decisions we took as a result – both for the

Executive Directors of Barclays PLC and

for the wider workforce.

Since last year’s report, Sir John Kingman

and Julia Wilson have joined the

Committee – bringing new perspectives

and a wealth of experience. I would like

formally to welcome them both.

I would also like to thank you, our

shareholders, for the support you showed

at our 2023 Annual General Meeting,

approving both our current Directors’

Remuneration Policy to apply for three

years from the date of that meeting –

supported by 97% of shareholder votes –

and the implementation during 2022 of our

previous Directors' Remuneration Policy.

Performance in 2023

As always, our remuneration approach is

rooted in our commitment to reward

sustainable performance. As the Group

Chief Executive sets out in his review, our

diversified income approach has enabled

us to continue to deliver well in 2023

despite an external backdrop of persistent

uncertainty – with heightened volatility

across asset classes, some significant

market disruption, and escalating

geopolitical tensions. In this testing

environment, we took deliberate, proactive

steps to protect the Group: maintaining a

prudent approach to risk management;

managing our balance sheet with care; and

continuing to invest in talent and

technology in sustainable growth areas,

while maintaining our focus on costs.

Barclays demonstrated its sound footing in

2023 and continued to see solid income

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|  | Board Remuneration Committee | | | | | | |  |
|  | Brian Gilvary  Chair, Board Remuneration Committee |  |  |  | Committee membership and meeting  attendance1 | | |  |
|  | B GILVARY 0027._Crop2.jpg | |  |  | Member | Meetings attended/eligible to attend  (including ad hoc meetings) | |  |
|  |  |  | Brian Gilvary | | 6/6 |  |
|  |  |  | Dawn Fitzpatrick | | 5/6 |  |
|  |  |  | Mary Francis | | 6/6 |  |
|  |  |  | Sir John Kingman2 | | 3/3 |  |
|  |  |  | Julia Wilson3 | | 2/2 |  |
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|  | Notes:  1 There were five scheduled meetings and one ad hoc  meeting of the Committee in 2023. Owing to a prior  commitment, Dawn Fitzpatrick was unable to attend  one scheduled meeting of the Committee. | | |  | Committee membership in 2023  2 Appointed with effect from 16 June 2023.  3 Appointed with effect from 1 July 2023. | | |  |
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performance across all three of our

operating businesses – resulting in Group

income of £25.4bn, up 2% on 2022.

Operating expenses for 2023 were

£16.9bn, a 1% increase on 2022, reflecting

business growth, investment spend and

inflation – delivering statutory profit before

tax of £6.6bn (2022: £7.0bn), down 6%.

This included £927m of structural cost

actions taken in the fourth quarter to help

drive future returns, having reviewed the

shape, efficiency and focus of our

businesses. Excluding these costs, profit

before tax was £7.5bn (2022: £7.7bn,

excluding the Over-issuance of Securities)

and RoTE was 10.6%, achieving our

greater-than-10% target. Our primary

frame of reference was financial outcomes

on this basis1, to understand the

underlying performance of the business

separate from the costs associated with

the decisions we made to shape its future.

We ended the year with a CET1 ratio of

13.8%, within our target range of 13% to

14%. We will deliver increased capital

distributions to shareholders, up c.37% on

2022, via a total dividend for the year of

8.0p per share and £1.75bn of announced

share buybacks – equivalent to a total

payout of c.19.4p per share.

Although income is down for some

business areas, those reductions are from

a starting point of strong 2022

performance for most business areas.

The Corporate and Investment Bank in

2023 saw income down slightly, a resilient

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performance given the unsettled

macroeconomic backdrop and the lowest

investment banking wallet in the last

decade2. Global Markets continued to

grow its income from our top 100 clients

and maintained its revenue ranking of

sixth3. Investment Banking also maintained

its sixth rank globally, despite the subdued

dealmaking environment, and returned to

first in the UK4, up from fourth in 2022. For

Consumer, Cards and Payments, income

was up 18%, reflecting the expansion and

deepening of our client relationships –

including our latest partnership launch with

Microsoft and Mastercard. Income was

also up in Barclays UK, supported by the

higher interest rate environment, partially

offset by competition in mortgage and

savings products.

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| + | Find more about our approach to pay fairness in our  Fair Pay Report 2023 at: [home.barclays/annualreport](https://home.barclays/investor-relations/reports-and-events/annual-reports/) |
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| + | Our UK pay gap figures for 2023 and narrative  explaining them are at:  [home.barclays/diversity](https://home.barclays/who-we-are/our-strategy/diversity-and-inclusion/) |
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Notes:

1 Page [390](#i0c3b612a6c5c40828e53fffbfc70d095_1128) includes a reconciliation of financial results

excluding the impact of Q423 structural cost actions for

2023 and the impact of the Over-issuance of Securities

for 2022.

2 Source: Dealogic.

3 Global Markets rank and revenue share based on

Barclays’ calculations using peer-reported financials.

Top 10 peer group includes Barclays, Bank of America,

Citigroup, Goldman Sachs, JPMorgan Chase & Co,

Morgan Stanley, BNP Paribas, Credit Suisse, Deutsche

Bank, and UBS.

4 Source: Dealogic for period covering 1 January 2023 to

31 December 2023. UK rank based on UK investment

bank revenue by bank for full year 2023.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 191 |
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| Remuneration report | | | | | | | | | | |

The Committee has maintained its focus

on ensuring we reward performance that is

sustainable. During 2023 the management

team has been embedding a new

operating standard – Consistently

Excellent – which aims to transform the

operational resilience of Barclays. Raising

our operating standards and reducing the

impact on financial performance of

unexpected issues will strengthen our

foundation to deliver sustainable

performance. This was reflected in our

objective setting, performance

assessment and reward processes for

senior colleagues for 2023, and in our

recognition platform for all colleagues, and

will be embedded more deeply and widely

during 2024. Striving to achieve a

consistently excellent standard is

becoming part of our culture, and initial

feedback suggests our work to equip all

colleagues with the right skills to achieve

this resonates as a way of driving

long-term success.

Colleague remuneration

Alongside rewarding sustainable

performance, our Fair Pay Agenda

continues to underpin all our remuneration

decisions – ensuring we are paying

colleagues fairly for the work they do and

recognising the contributions of all, within

the resources available to us. This is

especially pertinent given the challenges

colleagues continue to face – particularly

those who are lower-paid, given higher-

than-normal increases in the cost of living

over recent years. You can read more in

the 'Wider workforce remuneration'

section on page [204](#i4be61753b7f243b19551b0bfbf3a2a0d_15379) and in our sixth annual

Fair Pay Report published alongside this

Annual Report. We have also published our

pay gap figures for employees in the UK

and in Ireland.

Paying at least a living wage to all our

colleagues is a central element of our Fair

Pay Agenda. We continue to ensure we

meet or exceed living wage benchmarks in

every jurisdiction in which our employees

are based. In the UK our employees

already received more than the Living

Wage Foundation’s benchmarks, and we

are further increasing our minimum UK

full-time equivalent salary to £24,000. We

continue to meet or exceed Fair Wage

Network living wage benchmarks in all

other countries.

We have continued our work to be simpler,

more transparent and more consistent in

how we pay our more-junior colleagues.

For more junior roles in Barclays UK and

the support functions in the UK, we publish

starting salaries by role – providing

transparency for job candidates and

existing staff alike. From 2023, the

performance rating of each individual

across this population consistently drives

their annual bonus outcome as a

percentage of their salary. In previous

years a range of different approaches were

used and the annual bonus outcomes for

many of these roles were discretionary.

In setting this year's incentive pool we

considered Barclays’ financial and non-

financial performance, and the

performance of the individual businesses

that make up the Group, in both absolute

and relative terms. We considered each

business's contribution to the

achievement of our strategic targets and

its importance to our future success. The

Committee also wanted to recognise the

resilience across our operating businesses,

delivered against a backdrop of

macroeconomic uncertainty, as well as the

support our colleagues provided to

customers and clients. Taking all of this

into account, the Committee has

approved a Group incentive pool for 2023

performance of £1,745m (2022: £1,790m),

down 3% compared to the final incentive

pool for 2022, which included a c.£500m

reduction for risk and control issues that

came to light during 2022. Risk and

conduct adjustments to the 2023

incentive pool are materially less than

those for 2022, so the incentive pool

before risk adjustments each year fell by

c.15% from 2023 to 2022.

This level of incentive funding for 2023

reflects the lower year-on-year financial

outcomes in some business areas, while

also enabling us to reward colleagues for

the performance delivered – recognising

the progress made towards our strategic

priorities and our ambition to be

consistently excellent in our operations.

We also considered the competitive

market for hiring and retaining the talent

we need to achieve those priorities in the

future. In doing so, we weighed the views

and expectations of you as shareholders,

of our customers and clients, of our

colleagues, and of our stakeholders in

wider society. Consistent with our Fair Pay

Agenda, we have chosen to protect the

incentive outcomes for our more junior

colleagues – so, in business areas where

incentive spend was down year on year,

more senior colleagues experienced

greater reductions in annual bonus awards.

As always, a significant portion of the pool

will be delivered in shares, most of which

will be deferred over a number of years.

Group income

£25,378m

2022: £24,956m

Group profit before tax

£6,557m

2022: £7,012m

Group profit before impairment

(excluding adjusting items)1

£9,365m

2022: £8,906m

Group profit before tax

(excluding adjusting items)1

£7,484m

2022: £7,686m

Group RoTE

(excluding adjusting items)1

10.6%

2022: 11.6%

Group cost: income ratio

(excluding adjusting items)1

63%

2022: 64%

Group CET1 ratio

13.8%

2022: 13.9%

Group compensation to income ratio

34.4%

2022: 33.5%

Group incentive pool

£1,745m

2022: £1,790m

Note:

1 Adjusting items: Q423 structural cost actions in 2023

and the impact of the Over-issuance of Securities in

2022.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 192 |
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| Remuneration report (continued) | | | | | | | | | | |

Executive Director remuneration

Determining Executive Directors' pay

outcomes

The Committee considered the Executive

Directors’ annual bonus outcomes in the

context of the Group’s performance and

the performance of each Executive

Director during 2023.

The 2023 annual bonus outcome for C.S.

Venkatakrishnan (known as Venkat) was

53.3% of maximum, and for Anna Cross

was 54.3% of maximum (2022: 75.4% for

both). Profit before tax provided a 21.1%

outcome out of a possible 50%, and the

cost: income ratio provided a 2.7%

outcome out of a possible 10%.

Performance against the strategic non-

financial measures was good, which

resulted in a 16.5% outcome out of a

possible 25% and the performance of each

of the Executive Directors against their

personal objectives was also assessed and

taken into account (13.0% for Venkat and

14.0% for Anna out of a possible 15%).

Before finalising those outcomes, the

Committee reflected on their

appropriateness. We reviewed the

underlying financial health of the Group,

which is strong and well-capitalised. We

considered the bonus outcomes in the

context of those for the wider workforce,

ensuring suitable alignment both this year

and over a multi-year period, and also

compared to historical outcomes for the

Executive Directors in the context of

performance each year. We concluded

that the outcomes are appropriate in the

context of the performance achieved and

that no further discretionary adjustment

was warranted.

Neither Venkat nor Anna Cross

participated in the 2021-2023 LTIP cycle,

as neither was an Executive Director at the

time those awards were granted. The

Committee did, however, assess

performance against the measures for this

LTIP cycle to determine the vesting

outcome for the previous Group Finance

Director, who is the sole remaining

participant. This was 53.2% of the

maximum, as outlined later in this report.

The Committee decided to grant awards

under the 2024-2026 LTIP cycle with a

face value at grant of 140% of Fixed Pay

for Venkat and 134% of Fixed Pay for Anna

Cross, reflecting the personal contribution

made by each to a solid 2023 performance

– and to provide each with a significant

incentive award subject to forward-looking

performance conditions during 2024 to

2026.

The Executive Directors' pay in 2024

The Committee carefully considered the

performance measures for the Executive

Directors’ 2024 annual bonus and the

2024-2026 LTIP, and updated elements of

both the financial and non-financial

measures in each plan to better reflect the

revised targets set out under 'Our

strategy' from page [11](#i4be61753b7f243b19551b0bfbf3a2a0d_10551), and our long-term

climate strategy.

For the 2024 annual bonus, a total

operating expenses measure replaces

cost: income ratio – reflecting the

continued importance of cost discipline

while providing a more focused and simpler

measure of cost control within the year.

Other financial measures and weightings in

the bonus are unchanged.

For the 2024-2026 LTIP we have

increased slightly the weighting of RoTE,

from 25% to 30%, given the focus on

improving RoTE within the Group's 2026

targets. This is accommodated via a small

reduction to the weighting of the relative

total shareholder return measure from

25% to 20%. All other financial measures in

the LTIP remain unchanged from the

previous year's award, including the

continued use of cost: income ratio as a

longer-term cost measure.

We also reviewed the non-financial

measures for both the 2024 annual bonus

and 2024-2026 LTIP, to ensure they

reflect the Group’s shorter- and longer-

term priorities. Our commitment to align

our financing with the goals and timelines

of the Paris Climate Agreement has been

and remains a key component of our

climate strategy. Many of our climate and

sustainability targets are longer term,

including through to 2050, and progress

towards these is expected to be non-

linear. As such, we have retained the

Climate & sustainability category within the

Strategic non-financial assessment for the

annual bonus and LTIP, but increased its

weighting in the LTIP from 10% to 15% –

accommodating this by reducing the

weighting of the LTIP risk-related

measures (which this year also incorporate

assessment of operational excellence)

from 10% to 5%.

At the same time the ways we approach

and monitor risk, and ensure a high

standard of operational performance, are

fundamental to delivering sustainable

performance every year. To reflect our

focus on this across Barclays, we have

included a Risk & operational excellence

category within the Strategic non-financial

element of the 2024 annual bonus, with a

weighting of 10% – accommodated via a

slight reduction in the weighting of other

Strategic non-financial bonus measures.

The Climate & sustainability, Customers &

clients, and Colleagues categories are

each weighted 5%.

The Committee will continue to review the

measures and weightings for the Executive

Directors' incentives each year, to ensure

they appropriately support the delivery of

our strategy and reflect our priorities.

In early 2024, the Committee reviewed the

level of Fixed Pay for Venkat and Anna

Cross, in the same way and at the same

time as fixed pay was reviewed for the

wider workforce. The Committee

increased Fixed Pay by 2.5% for both

Venkat and Anna, resulting in Fixed Pay of

£2,947,000 and £1,845,000 respectively,

effective from 1 March 2024. These

percentage increases are significantly

lower than the average across the wider

workforce, in particular for other UK

employees within the scope of the 2024

UK pay deal with the union Unite – with a

5.55% budget for salary increases for

junior employees and a 3.75% budget for

other union-recognised employees. Even

following these Fixed Pay increases, the

total compensation opportunity for each

Executive Director remains well behind the

median opportunity for equivalent roles

across our international banking peer

group.

Shareholder alignment

Of the total variable pay awards to Venkat

and Anna Cross in respect of 2023

performance (2023 annual bonus plus

2024-2026 LTIP), 96% and 94%

respectively will be in shares that must be

retained for a period of between one and

eight years from grant – aligning the

Executive Directors' interests with those

of our shareholders. Both Venkat and Anna

Cross already have significant

shareholdings.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 193 |
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| Remuneration report (continued) | | | | | | | | | | |

Group Chair and Non-Executive

Director fees

The Committee periodically reviews the

Group Chair's fee, and the Directors'

Remuneration Policy allows for increases

of up to 20% during the policy's three-year

term. The Committee last increased the

Group Chair's fee with effect from 1

January 2023, having considered the fee in

the context of the Chair fees paid across

our international banking peer group – with

a particular focus on the UK banks, given

the regional differences in both the role

and pay for non-executive directors

including chairs. Prior to that, this fee had

remained at the same level since 2015.

Early in 2024, the Committee approved a

2% increase in the Group Chair's fee, from

£840,000 to £856,800, effective 1 January

2024. Each year £100,000 of the fee will

continue to be used to purchase Barclays

shares that will be retained on the Group

Chair's behalf until he retires from the

Board. No other changes were made to

the Group Chair's remuneration

arrangements or benefits.

In January 2024 the Board reviewed the

other Non-Executive Directors' fees,

which were also last increased with effect

from 1 January 2023, and approved 2%

increases to those fees effective

1 January 2024 (with the relevant Non-

Executive Directors having recused

themselves from those discussions).

Update in respect of Jes Staley's

remuneration

As outlined in the 2021 Annual Report,

Jes Staley stepped down from the role of

Group Chief Executive on

31 October 2021 and his unvested awards

were suspended pending further

developments in respect of the regulatory

and legal proceedings related to the FCA

and PRA investigation regarding Mr Staley.

In October 2023, the FCA issued a

Decision Notice in relation to Mr Staley.

The Committee considered the detailed

findings in this Decision Notice and

concluded that Mr Staley should be

ineligible for or forfeit a number of his

awards, including the bonus award in

respect of the 2021 performance year, all

of his unvested LTIP awards – both those

for which the performance had already

been assessed and those still subject to

performance conditions – and his other

unvested deferred bonus awards from

earlier years. The total value of the lapsed

LTIP awards and forfeited deferred bonus

awards at that time was £17.8m.

Looking ahead

As we move into 2024, the Committee

maintains its commitment to rewarding

sustainable performance.

We will use our remuneration policies and

practices to incentivise the Executive

Directors and the management team to

deliver our three year plan, improving

operational and financial performance, and

improving shareholder returns.

We will support the management team to

use performance management and pay:

– to align the wider workforce to those

same priorities

– to reinforce the importance of good

conduct, strong controls and risk

management and

– to support Barclays' Purpose, Values

and Mindset, and our ambition to

achieve a standard of being consistently

excellent.

We will continue to engage with our

shareholders and other stakeholders on

pay and will be meeting with our largest

shareholders to discuss our pay outcomes

for 2023.

Beyond this, we will maintain focus on our

Fair Pay Agenda, continuing to support our

colleagues and ensuring the way we pay

our people supports the long-term health

and success of the Group.

Brian Gilvary

Chair, Board Remuneration Committee

February 2024

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|  | Removal of the regulatory  requirement to operate  a 2:1 'bonus cap'  With effect from 31 October 2023,  the PRA and FCA removed the UK  regulatory requirement for certain  banks, including Barclays, to apply a  maximum 1:1 ratio of variable to fixed  remuneration for employees who are  deemed to have a material risk impact  on their firm – known as Material Risk  Takers (MRTs) – or up to a 2:1 ratio if  shareholders approve the adoption of  that higher maximum. Our  shareholders approved the adoption  of a 2:1 maximum ratio for Barclays  MRTs around the time that these  regulations first came into effect.  Going forward, such banks – including  Barclays – will be permitted to set their  maximum variable pay ratios to be  greater than 2:1.  As the new regulations were published  close to the end of 2023, the  Committee determined that the 2:1  cap would continue to apply in  Barclays for the 2023 performance  year. The Committee will consider this  further in respect of 2024 and future  years.  A relatively small number of our  employees are potentially impacted  by this regulatory change. Our  Executive Directors’ maximum  variable pay opportunity is governed  by the Directors' Remuneration Policy  that shareholders approved at our  2023 AGM, and therefore is  unchanged by these new regulations.  The Directors' Remuneration Policy  will continue to apply until a new policy  is approved by shareholders. No new  Directors' Remuneration Policy is  proposed for 2024. |  |
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| Remuneration report (continued) | | | | | | | | | | |

![177]()

![189]()

![201]()

![213]()

At a glance – Executive Director remuneration for 2023

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| Fixed  Pay | + | Pensions  and  benefits | + | Annual  bonus | + | LTIP | = | Total  remuneration |

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| Total remuneration outcomes (£000) 1 | | | |  |
| C.S. Venkatakrishnan (Group Chief Executive) | |  | Proportion in shares |  |

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| 2023 max |
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| 2023 actual |
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| 2022 actual |

![62]()

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|  | 96% | of 2023  variable pay 3 |  |
|  | 80% | of maximum total  remuneration  (2023 max) |  |
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| Anna Cross (Group Finance Director) | |  | Proportion in shares | |

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| 2023 max |
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| 2023 actual |
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| 2022 actual2 |

![69]()

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|  | 94% | of 2023  variable pay 3 |  |
|  | 80% | of maximum total  remuneration  (2023 max) |  |
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| 1 The LTIP values shown for C.S. Venkatakrishnan's and Anna Cross's 2022 actual and 2023 actual total remuneration are nil as neither participated in the 2020-2022 or 2021-2023  LTIP cycles. The LTIP values shown for 2023 maximum represent the maximum LTIP award value that could have been granted under the current Directors' Remuneration Policy.  2 Anna Cross was appointed as Group Finance Director on 23 April 2022.The values shown for 2022 are part-year values for the time she served as an Executive Director during 2022.  3 2023 variable pay comprises the actual 2023 annual bonus and the grant-date face value of the 2024-2026 LTIP award that will be granted in respect of 2023 performance. |

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| + | See single total figure for 2023  remuneration on page [207](#i4be61753b7f243b19551b0bfbf3a2a0d_541) |
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| --- | --- | --- | --- |
|  |  |  |  |
| Annual bonus outcomes | | |  |
| Annual bonus measures | Weighting (proportion  of bonus opportunity) | Outcome  C.S. Venkatakrishnan | Outcome  Anna Cross |
| Financial4 | 60.0% | 23.8% | 23.8% |
| • Profit before tax | 50.0% | 21.1% | 21.1% |
| • Cost: income ratio | 10.0% | 2.7% | 2.7% |
| Strategic non-financial | 25.0% | 16.5% | 16.5% |
| Personal | 15.0% | 13.0% | 14.0% |
| Total | 100.0% | 53.3% | 54.3% |
| Final outcome approved  by the Committee |  |  |  |
| 4 The financial measures are defined as excluding material items, which for 2023 consist of Q423 structural cost actions of £927m. | | | |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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| Delivery of remuneration5 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |  |  |
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|  | Performance year | |  | Year 1 | | | Year 2 | | | Year 3 | | | Year 4 | | | Year 5 | | | Year 6 | | | Year 7 | | | Year 8 | | | Year 9 | | |
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| Fixed  Pay | 50% in cash  paid monthly | Annual Report arrows2.png |  | 50% in shares with restrictions lifting over five years | | | | | | | | | | | | | Annual Report arrows2.png |  |  |  |  |  |  |  |  |  |  |  |  |  |
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| Pension | Cash in lieu  of pension  contributions | Annual Report arrows3.png |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
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| Annual  bonus | Performance  period |  |  | Max.  50%6  in cash | Annual Report arrows5.png |  | Remainder in shares  vesting over two years | | | |  |  | Holding  period |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| LTIP | Preliminary  performance  period | Annual Report arrows.png |  | Three-year post-grant performance period | | | | | | |  |  | Deferral in shares over five years | | | | | | | | | | | | |  |  | Holding  period |  |  |
| 5 Illustrative timing that the different elements of remuneration are normally received. Fixed Pay shares are granted quarterly and released in five equal annual instalments on the first five anniversaries of  grant. All tranches of annual bonus and LTIP shares typically vest in March of the relevant year and are subject to a 12-month holding period from the date they vest.  6 In recent years, less than 50% of annual bonus has been delivered in cash in year one, and a greater proportion of annual bonus has been delivered in shares over years one, two and three. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 195 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

![225]()

![237]()

![249]()

9,915

4,641

5,197

5,926

2,773

2,057

|  |  |
| --- | --- |
|  |  |
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| • |  |
| • |  |
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| • |  |
| • | • |
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|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Remuneration policy for the Executive Directors – implementation for 2024 | | | |
| Delivery of remuneration is intended to be the same as for the 2023 performance year, as outlined on the previous page. | | | |
| Element | | C.S. Venkatakrishnan | Anna Cross |
|  | Fixed  Pay | 2.5% increase to £2,947,000 effective  1 March 2024 | 2.5% increase to £1,845,000 effective  1 March 2024 |
|  | Pensions  and benefits | Pension: £147,350 effective 1 March 2024,  equivalent to 5% of Fixed Pay  Benefits: entitlement as per the policy | Pension: £92,250 effective 1 March 2024,  equivalent to 5% of Fixed Pay  Benefits: entitlement as per the policy |
|  | Annual  bonus | Up to 93% of year-end Fixed Pay, based on forward-  looking performance measures set near  the start of  the year | Up to 90% of year-end Fixed Pay, based on forward-  looking performance measures set near  the start of  the year |
|  | LTIP | Up to 140% of year-end Fixed Pay, based on forward-  looking performance measures set shortly before the  time of grant | Up to 134% of year-end Fixed Pay, based on forward-  looking performance measures set shortly before the  time of grant |
|  | Shareholding  requirement | Holding requirement: 233% of Fixed Pay  Post-employment shareholding requirements  apply for two years | Holding requirement: 224% of Fixed Pay  Post-employment shareholding requirements  apply for two years |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
| Alignment of performance measures and strategy | | | | | | | |
| Performance measures | Weighting in annual  bonus and LTIP | | Alignment to strategy | Alignment to  stakeholder groups | | | |
| Financial |  |  |  |  |  |  |  |
| Profit before tax (with a  CET1 ratio underpin) | 50% |  | A measure of annual financial performance and a key factor  that drives RoTE |  |  |  | • |
| Total operating  expenses (at specific FX) | 10% |  | A measure of the ability to effectively manage costs (measured at fixed  foreign exchange rates to reduce impacts outside of management control) |  |  |  | • |
| Return on tangible  equity (RoTE) |  | 30% | A measure of our ability to generate returns for shareholders that underpins  the Group’s capital allocation and performance management processes |  |  |  | • |
| Cost: income ratio |  | 10% | A measure of the productivity of our business operations over time |  |  |  | • |
| CET1 ratio |  | 10% | A measure of capital strength and resilience, determined in accordance with  regulatory requirements |  |  |  | • |
| Relative total  shareholder return |  | 20% | A measure of Barclays' share performance (comprising share price  appreciation and dividends paid) relative to those of a basket of  comparable firms |  |  |  | • |
| Personal | 15% |  | Individual objectives for each Executive Director, aligned to our  strategic priorities | • | • | • | • |
| Strategic non-  financial | 25% | 30% | Includes the Group's non-financial key performance indicators, including  Climate & sustainability as a strategic priority, Customers & clients and  Colleagues as key stakeholder groups, and Risk & operational excellence,  which is fundamental to operating at a consistently excellent standard to  deliver sustainable performance | • | • | • | • |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | l | 2024 annual bonus | l | 2024-2026 LTIP |  | l | Customers & clients | l | Colleagues | l | Society | l | Investors |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Share ownership (£000) | | |
| Shareholding shown as at 31 December 2023, using Q4 2023 average share price of £1.4374. | | |
| C.S. Venkatakrishnan |  | Anna Cross |

![158879430217517]()

![50027779070885]()

Based on 31 December 2023 Fixed Pay of £2,875k.

C.S. Venkatakrishnan has until 31 October 2026 (five years from

the date of his appointment as Group Chief Executive) to meet

this shareholding requirement.

![155031139521727]()

![50027779070902]()

Based on 31 December 2023 Fixed Pay of £1,800k.

Anna Cross has until 22 April 2027 (five years from the date of her

appointment as Group Finance Director) to meet this

shareholding requirement.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 196 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| ¢ | Actual shareholdings (including the estimated after-tax value of unvested  shares not subject to performance conditions) | ¢ | Unvested shares subject to performance conditions (which do not count  towards the requirement) | ¢ | Shareholding  requirement |

Wider workforce remuneration

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Our remuneration philosophy |  |
|  |  |  |

Our remuneration philosophy applies to all employees and sets out

the way we approach remuneration. Its aim is to be as simple and

clear as possible, while ensuring strong alignment with risk and

conduct as well as our Values and Mindset. It is also closely aligned

with Provision 40 of the FRC's UK Corporate Governance Code.

The remuneration decisions set out in this report are a result of the

application of our remuneration philosophy in respect of 2023.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Philosophy | | |
| Attract and retain  talent needed to  deliver Barclays’  strategy |  | Long-term success depends on the talent of our  employees. This means attracting and retaining  an appropriate range of talent to deliver against  our strategy, and paying the right amount for that  talent. |
| Align pay with  investor and other  stakeholder  interests |  | Remuneration should be designed with  appropriate consideration of the views, rights and  interests of stakeholders. This means listening to  our shareholders, other investors, regulators,  government, customers and employees and  ensuring their views are appropriately  represented in remuneration decision-making. |
| Reward sustainable  performance |  | Sustainable performance means making a  positive and enduring difference to investors,  customers and communities, delivering good  customer outcomes, taking pride in leaving things  better than we found them and playing a valuable  role in society. |
| Support Barclays’  Values and culture |  | Results must be achieved in a manner consistent  with our Values. Our Values, culture and Mindset  should drive the way that business is conducted. |
| Align with risk  appetite, risk  exposure and  conduct  expectations |  | Designed to reward employees for achieving  results in line with the Group’s risk appetite and  conduct expectations. |
| Be fair, transparent  and as simple  as  possible |  | We are committed to ensuring pay is fair, simple  and transparent for all our stakeholders. All  employees and stakeholders should understand  how we reward our employees, and fairness  should be a lens through which we make  remuneration decisions. |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Diversity ambitions and pay gaps |  |
|  |  |  |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | Diversity ambitions | |  |
|  | 33% | 33% females at Managing Director  and Director level by 2025 |  |
|  | 50% | 50% increase in Managing Directors  from underrepresented ethnicities in  the UK and US combined by 2025  (from 2022 baseline) |  |
|  | 12.5% | Increase underrepresented minority  representation in the UK by 12.5% by  2025 (from 2023 baseline) |  |
|  | 5% | Increase underrepresented minority  representation in the US by 5% by  2025 (from 2023 baseline) |  |
|  |  |  |  |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | Our Fair Pay Agenda | |  |
|  |  |  |  |
|  | Paying people fairly is an essential element of our pay philosophy.  We have developed our fair pay approach over a number of years,  and we continue to ensure that fairness is a key and explicit  consideration in the way we make all of our pay decisions. | |  |
|  | Our fair pay principles | |  |
|  |  |  |  |
|  | FairPayPPle_icon_1.png | Fair pay for the lowest paid  Paying fairly for work done, in a simple and transparent way. |  |
|  |  |  |  |
|  | FairPayPPle_icon_2.png | Equal opportunities to progress  Providing equal employment opportunities to all, so everyone can  enjoy a successful career at Barclays. |  |
|  |  |  |  |
|  | FairPayPPle_icon_3.png | Engaging with colleagues  Engaging with colleagues to understand their views on the  culture of the organisation and enabling the representation of  employees in our remuneration decision-making process. |  |
|  |  |  |  |
|  | FairPayPPle_icon_5.png | Alignment of employee and Executive Director pay  Linking both Executive Director and employee pay to sustainable  business performance. |  |
|  |  |  |  |
|  | FairPayPPle_icon_4.png | Equal pay commitment  Rewarding employees fairly for their contribution and making  sure pay and performance decisions never take into account any  protected characteristics. |  |
|  |  |  |  |
|  | Supporting our colleagues | |  |
|  |  |  |  |
|  | We provided higher salary increase budgets for junior  employees, including under the UK pay deal with Unite | |  |
|  | In business areas where the incentive spend was reduced, we  protected incentive outcomes for junior employees | |  |
|  | Over 97% of employees globally are eligible for private  medical cover | |  |
|  | We continued to enhance our wellbeing provision,  including the addition of a new wellbeing training module | |  |
|  | We offer dedicated menopause support through our  healthcare providers across all our large locations as well as  training for people leaders | |  |
|  |  |  |  |

|  |  |
| --- | --- |
|  |  |
| + | More information on our fair pay approach can be found in our Fair Pay Report 2023 at:  home.barclays/annualreport |
|  |

|  |
| --- |
|  |
| Pay gaps |

We disclose our pay gaps for locations including the UK, Ireland

and France.

• Our gender and ethnicity pay gaps are due to

underrepresentation of females and certain ethnic minority

groups in senior and other higher-paying roles.

• Being transparent about this, and the resulting  pay gaps,

is important as it helps us track where we are in the pursuit

of our goals and understand what tangible actions we can take

to improve representation over time.

|  |  |
| --- | --- |
|  |  |
| + | For information on our progress against our diversity ambitions,  see page  [210](#i8958dfd3d5354840a56a1ffea7aeb8fe_278487) |
|  |

|  |  |
| --- | --- |
|  |  |
| + | More information on our diversity ambitions and pay gaps can be found at:  home.barclays/diversity |
|  |

|  |  |
| --- | --- |
|  |  |
| + | UK gender and ethnicity pay gaps for 2023 are shown in our UK Pay Gaps 2023  disclosure, which can be found at:  home.barclays/diversity |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 197 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Alignment of remuneration policy for the wider workforce and Executive Directors |  |
|  |  |  |

Most elements of remuneration policy are aligned for the wider workforce and the Executive Directors. Differences in policy

implementation between seniority levels reflect our remuneration philosophy. For example, the balance between fixed and variable pay

is shifted toward fixed pay for employees in more-junior roles and towards variable pay for those in more-senior roles. A large

proportion of variable pay for senior employees, or the majority of variable pay and half of Fixed Pay for the Executive Directors, is

delivered in shares over multiple years – aligning their interests more closely with those of shareholders – whereas pay is primarily in

cash for more-junior employees. Aligned with our Fair Pay Agenda, UK employer pension contributions are also higher for our junior

employees.

The table below provides a summary of remuneration arrangements for the wider workforce and the Executive Directors.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Element | | Junior employees | Senior employees | How Executive Director policy aligns |
|  | Fixed pay | Reflects the individual’s role, skills and experience and is reviewed annually. Fixed pay is  increased where justified by role change, increased responsibility or a change in the  market rate for the role. Salaries may also be increased in line with local statutory  requirements and with union and works council commitments. | | Reflects the individual’s role, skills and  experience, set to provide a market-  competitive total compensation  opportunity, and is reviewed annually.  Annual increases are typically no more than  the average increase for UK employees. |
|  | Delivery | All in salary for most, paid in cash. Some  roles are also entitled to receive certain  cash allowances. | All in salary for most. For a small number of  senior employees (2% globally) a  proportion is delivered in Role Based Pay  (RBP), in cash or shares, to recognise the  seniority, scale and complexity of their role.  The RBP value may change, for example,  where justified by a role or responsibility  change or a change in the market rate for  the role. | 50% is delivered in cash (paid monthly), and  50% in shares. The shares are delivered in  four equal quarterly instalments and are  then subject to a holding period, with  restrictions lifting over five years. |
|  | Pensions | Competitive pension offering set by  location. Minimum of 12% of salary for more  junior colleagues in the UK. | Competitive pension offering set by  location. Minimum of 10% of salary in the  UK. | The Executive Directors receive cash in lieu  of pension equal to 5% of Fixed Pay  (equivalent to 10% of the cash element of  Fixed Pay). |
|  | Benefits | Market-aligned benefits offering  appropriate to the role and reflecting local  market practice to support with health and  wellbeing. | Market-aligned benefits offering, but  typically a lower proportion of total pay  than for junior employees. | Market-aligned benefits offering, but  typically a lower proportion of total pay than  for the wider workforce. |
|  | Annual bonus | Annual bonuses incentivise and reward the achievement of Group, business and  individual objectives, and reward employees for demonstrating individual behaviours in  line with Barclays’ Values and Mindset. All employees are considered, subject to eligibility  criteria. | | Assessed against predetermined targets  and measures to align with financial  performance, strategic non-financial  performance and personal performance. |
|  | Delivery | In cash following the performance year. | For many a proportion of annual bonus is  deferred to future years. Deferred  bonuses are generally delivered half in  deferred cash and half in deferred shares,  released in equal annual instalments over  three, four, five or seven years, with a  further six or 12-month holding period for  some roles. | The majority of annual bonus is generally  deferred in shares and then subject to a  further 12-month holding period. Across  the annual bonus and any LTIP award  combined, deferral will always at least meet  regulatory requirements. |
|  | Long Term  Incentive Plan  (LTIP) award | Not applicable to the wider workforce. | | The value received from LTIP awards  depends on assessment of performance  over a three-year period against Group-  wide financial and non-financial measures.  Delivery is in shares between the third and  seventh year from grant, with each release  subject to a further 12-month holding  period. |
|  | All-employee  share plans | Provide an opportunity for all employees to acquire Barclays shares, in some locations on beneficial terms. Barclays operates all-  employee share plans in locations representing 99% of employees globally. | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Role of the Remuneration Committee in wider workforce remuneration |  |
|  |  |  |

The Committee considers the overarching objectives, principles and parameters of remuneration policy across the Group, ensuring a

coherent approach in respect of all employees. In discharging this responsibility the Committee seeks to ensure the policy is fair and

transparent, avoids complexity, and assesses – among other things – the impact of pay arrangements in supporting the Group’s culture,

Values and strategy and on all elements of risk management. The Committee performs the following activities in relation to wider

workforce remuneration:

– Ensures alignment of remuneration with the remuneration philosophy, Fair Pay Agenda and Barclays' Purpose, Values, Mindset,

conduct expectations and long-term success

– Ensures alignment of wider workforce and Executive Director remuneration policies

– Approves the bonus pool across the wider workforce and reviews wider workforce pay outcomes

– Reviews the annual Group fixed pay budgets.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 198 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Performance management |  |
|  |  |  |

Performance management plays a key role

both in supporting colleagues to progress

their careers and in making Barclays a

consistently excellent organisation.

Our performance management approach

centres on continuous performance

management principles.

This encourages people leaders to discuss

performance throughout the year,

|  |
| --- |
|  |
|  |

including reviewing progress made against

‘what’ has been achieved (performance

versus individual objectives) and ‘how’ it

has been achieved (behaviours in line with

our Values and Mindset, in addition to our

leadership behaviours for senior leaders).

At year-end, colleagues are assessed

separately on the ‘what’ and the ‘how' of

their performance.

|  |
| --- |
|  |
|  |

This assessment is reflected in colleague

performance ratings and bonus outcomes.

For 2023, our aspiration to be a

consistently excellent organisation was

reflected in performance management for

senior colleagues – and will be embedded

more deeply and widely during 2024.

|  |  |
| --- | --- |
|  |  |
| + | For more details see our Fair Pay Report 2023 at:  home.barclays/annualreport |
|  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Engaging with stakeholders on remuneration |  |
|  |  |  |

We seek to consider the views of all of our stakeholders in remuneration decision-making, including colleagues, investors and regulators.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Colleagues  We engage with colleagues to understand their  views through our Your View surveys, union and  works council engagements, and townhalls. We  also engage with colleagues through our  Employee Resource Groups, webcasts,  workshops and events.  Our ongoing engagement with the union Unite  in the UK covers a range of topics, such as fair  pay and the increasing cost of living, and this is  another opportunity for the views of colleagues  to inform decision-making. For information on  our 2024 pay deal with Unite see 'Salary budget  for 2024', below.  We publish information to explain to colleagues  how the Group’s performance and pay  approach aligns to the Fair Pay Agenda, and to  help them understand the employee benefits  Barclays provides – so they can make the most  of what is on offer. To communicate pay in a  clear way, each colleague receives a  Compensation Profile detailing their fixed pay  and incentives for the previous year and their  fixed pay for the following year. |  |  |  | Investors  We recognise that remuneration is an area of  particular interest to some shareholders. We  listen to their views and take these into account  when setting remuneration or considering  changes to remuneration policies. Accordingly,  the Group Chair or Remuneration Committee  Chair hold meetings each year with major  shareholders and representative groups to  understand their views, accompanied by senior  Barclays employees. In 2023, we discussed our  remuneration policies and our 2022 pay  outcomes with representatives of some of our  institutional shareholders and proxy voting  agencies.  This kind of engagement helps inform the  Committee's work and contributes directly to  the decisions it makes in relation to Executive  Directors' remuneration. For example,  shareholder views were a key consideration in  the Committee's decision to increase the  weighting of the Climate & sustainability  category from 10% to 15% for the 2024-2026  LTIP cycle. |  |  |  | Other stakeholders  Each year, the Barclays Internal Audit or Chief  Controls Office teams review our remuneration  policies and how we've operated our  remuneration processes, to provide assurance  to the management team and the Committee  that we are compliant with regulatory  requirements.  Whenever regulations on remuneration are  changed, we review our remuneration policies  and practices to ensure they are compliant –  and make changes if necessary.  In 2023 we continued to engage with our  regulators to ensure we understand their  perspectives, and to explain our performance,  pay priorities and decision-making. We took  their views into consideration when making our  remuneration decisions for 2023, and continue  to ensure we have ongoing regulatory dialogue  on remuneration. |  |
|  |  |  |  |  |  |  |  |  |  |  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Fixed pay decisions for 2024 |  |
|  |  |  |

Living wage employer

We continue to ensure that we at least

meet the living wage benchmarks for each

location, and are an accredited Living

Wage employer in the UK.

Salary budget for 2024

We targeted our salary increase budgets

so there are higher increases for the most

junior colleagues. In the UK, with the union

Unite, we have agreed a salary increase

budget of 5.55% for our junior employees

and 3.75% for other union-recognised

employees. For junior employees in India

and the US salary increase budgets are 8%

and 3.25% respectively.

The percentage Fixed Pay increases for

the Executive Directors are below the

average percentage increases for the

wider workforce; the Group Chief

Executive and Group Finance Director will

each receive a 2.5% increase in Fixed Pay.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | Exceeding the living wage in key locations | | |  |
|  | We pay at least the living wage in all locations. Below are our minimum hourly rates  from 1 March 2024 for the UK, USA and India, where 90% of employees are based. | | |  |
|  | £13.19  UK  2023: £12.23 | $22.50  USA  2023: $22.50 | ₹150.00  India  2023: R143.00 |  |
|  |  |  |  |  |

Pay transparency

We have continued to simplify our pay

approach for junior colleagues, making it

easier for them to understand how their

pay is set and managed.

Pay levels and annual salary increases for

our most junior roles in Barclays UK and

support functions in the UK are based on

role type, and starting salaries are published.

|  |
| --- |
|  |
|  |

Annual bonus approaches for those

populations have also been harmonised.

Previously, bonus outcomes were fully

discretionary for many of these roles. From

2023, annual bonus outcomes are a set

percentage of salary, differentiated by each

employee's performance rating.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 199 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

![7146825583038]()

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Incentive pool and annual bonus outcomes for 2023 |  |
|  |  |  |

Determining the Group incentive pool

In determining the 2023 Group incentive pool,

the Committee considered:

• The Group's financial and non-financial

performance during 2023 (both absolute and

relative)

• The performance of individual businesses

within the Group and their contributions to

our strategic targets and vision

• The Group’s capital position and current and

future risks

• The need to reward strong performers

appropriately, as well as recognising

colleagues who have exemplified the

Barclays Values and Mindset

• Compensation market data and expected

market trends, to maintain competitiveness

where performance warrants.

The Committee used its judgement to establish

the right balance between annual bonus

outcomes that reflect the performance of the

Group and managing the Group's cost base,

while supporting its ability to attract, retain and

reward colleagues who will drive the delivery of

the Group’s strategy and sustainable growth for

shareholders in the future, in line with our

remuneration philosophy.

On that basis, the Committee approved a Group

incentive pool for 2023 performance of

£1,745m (2022: £1,790m), down 3% compared

to the final incentive pool for 2022, which itself

incorporated a c.£500m reduction for risk and

control issues that came to light during 2022.

The risk and conduct adjustments to the 2023

incentive pool are materially less than those for

2022, so the incentive pool before risk

adjustments each year fell by c.15% from 2023

to 2022 – as seen in the chart on the right.

The Group incentive pool and Group

Chief Executive bonus outcomes

The incentive approach for our Executive

Directors is significantly more structured than

for other employees, as required by institutional

shareholders for directors of UK-listed

companies. This more-structured approach,

with a need for direct alignment to financial

performance metrics, leads to greater year-on-

year volatility in incentive outcomes – both up

and down – for the Executive Directors

compared to other employees.

For 2023, like every year, the Committee

considered the Executive Director bonus

outcomes in the context of the bonus

outcomes for the wider workforce, ensuring

appropriate alignment both this year and over a

multi-year period. It also reviewed the historical

outcomes for the Executive Directors in the

context of performance each year and

concluded they were appropriate in the context

of the performance achieved.

Consistent with our Fair Pay Agenda, incentive

outcomes for junior employees are largely

protected, so, in business areas where incentive

spend was down year on year, more senior

colleagues experienced greater reductions in

annual bonus awards.

|  |
| --- |
|  |
| Group incentive pool and Group Chief Executive bonus outcomes over the years |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| Key performance metrics | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 |  |
| Profit before  impairment (ex.  adjusting items)1 | 7,169m | 8,118m | 8,056m | 7,761m | 8,906m | 9,365m |  |
| Profit before tax  (ex. adjusting items)1 | 5,701m | 6,206m | 3,218m | 8,414m | 7,686m | 7,484m |  |
| RoTE (ex. adjusting  items)1 | 8.5% | 9.0% | 3.4% | 13.5% | 11.6% | 10.6% |  |
| CET1 ratio | 13.2% | 13.8% | 15.1% | 15.1% | 13.9% | 13.8% |  |
| Group compensation  to income ratio 2 | 34.1% | 33.9% | 34.2% | 34.7% | 33.5% | 34.4% |  |

|  |  |
| --- | --- |
|  |  |
| < | Group incentive pool (£m) |
|  | Group Chief Executive bonus outcome (% of maximum) |
|  |
| < | Risk and conduct adjustments (£m) |

|  |
| --- |
|  |
| Notes:  1 Figures exclude the following adjusting items (pre-tax for profit and post-tax for RoTE): 2023: Q423 structural cost  actions (£927m pre-tax and £739m post-tax); 2022: impact of Over-issuance of Securities (£674m pre-tax and  £552m post-tax); 2021: impact of Over-issuance of Securities (£220m pre-tax and £170m post-tax); 2020: litigation  and conduct (£153m pre-tax and £112m post-tax); 2019: litigation and conduct (£1,849m pre-tax and £1,733m post-  tax); 2018:  litigation and conduct (£2,207m pre-tax and £2,136m post-tax).  2 2018 Group compensation to income ratio excludes £140m relating to GMP charge post-retirement benefits. |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  |  |  |  |
|  | Annual percentage change in remuneration of Directors and  employees  • The annual percentage change in fixed pay earned in 2023, compared to 2022, is  3% for the Group Chief Executive and 9% for the median UK employee –  reflecting the Fixed Pay and salary increases awarded in early 2023. | | |  |
|  |  |  |  |  |

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| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  |  |  |  |
|  | Group Chief Executive pay ratio: 83:1  • Our Group Chief Executive median pay ratio for 2023 is down in comparison to  2022 (101:1) .  • This is due to a decrease in the CEO single total figure for remuneration from  2022 to 2023 and an increase in median total pay of UK employees over the same  period. | | |  |
|  |  |  |  |  |

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 200 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

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| --- | --- |
|  |  |
| + | Full details and supporting narrative  See page [223](#ica393c12f6224fdba10fdea73c5bf0b0_132674) |
|  |

|  |  |
| --- | --- |
|  |  |
| + | Full details and supporting narrative  See page [222](#ica393c12f6224fdba10fdea73c5bf0b0_132673) |
|  |

#### Directors’ Remuneration Policy

The Directors' Remuneration Policy was approved at the AGM

held on 3 May 2023 and applies for three years from that date.

The Committee reviewed the Directors' Remuneration Policy and

concluded that it has been operating effectively and is well aligned

with our remuneration philosophy.

A summary of the policy for the Executive Directors, including key

remuneration elements and its implementation for 2023 and

2024, is set out below.

The full policy, including arrangements for recruitment and leaver

provisions, and the remuneration policy for Non-Executive

Directors, can be found on pages 209 to 217 of the 2022 Annual

Report, which is available at [home.barclays/annualreport](https://home.barclays/investor-relations/reports-and-events/annual-reports/).

Remuneration policy summary – Executive Directors

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| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | Element and purpose |  | Operation |  | 2023 pay outcomes |  | Implementation for 2024 |
|  | Fixed Pay  To reward skills and  experience appropriate  for the scale, complexity  and responsibilities of  the role and to provide  the basis for a  competitive  remuneration package. |  | • Determined based on the individual’s role,  skills and experience and set at a level that  aims to provide an appropriately competitive  total compensation opportunity, which is  benchmarked against similar roles within the  international banking peer group used by the  Committee when considering the Executive  Directors' pay.  • Delivered 50% in cash (paid monthly) and  50% in shares quarterly (subject to a holding  period of five years, with 20% released  annually).  • Reviewed annually. Increases will normally  be no more than the average annual  increase for UK employees. |  | Effective 1 March 2023:  C.S. Venkatakrishnan  £2,875,000  Anna Cross  £1,800,000 |  | Effective 1 March 2024:  C.S. Venkatakrishnan  2.5% increase to  £2,947,000  Anna Cross  2.5% increase to  £1,845,000  For comparison, the 2024  UK pay deal provides a  salary increase budget of  5.55% for junior  employees and a 3.75%  budget for other union-  recognised employees. |
|  | Pension  To support Executive  Directors to build long-  term retirement savings. |  | • Delivered as an annual cash allowance in lieu  of participation in a pension arrangement.  • The maximum is currently 5% of Fixed Pay  (equivalent to 10% of the cash element of  Fixed Pay). |  | Effective 1 March 2023:  C.S. Venkatakrishnan  £143,750  Anna Cross  £90,000  (5% of Fixed Pay for each) |  | Effective 1 March 2024:  C.S. Venkatakrishnan  £147,350  Anna Cross  £92,250  Pension will remain at  5% of Fixed Pay |
|  | Benefits  To provide a competitive  and cost-effective  benefits package  appropriate to the role  and reflecting local  market practice, and to  support the health and  wellbeing of the  Executive Directors. |  | • A range of benefits is provided including  private medical cover, annual health check,  life insurance and ill health income protection,  and use of a Company vehicle and driver  when required for business purposes  (including any tax liabilities that may arise  from these benefits).  • If an Executive Director relocates to perform  their role, additional support may be provided  for a defined and limited period of time, in line  with Barclays’ general employee mobility  policies and practices. |  | Benefits as per policy |  | Benefits as per policy |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 201 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

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| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | Element and purpose |  | Operation |  | 2023 pay outcomes |  | Implementation for 2024 |
|  | Annual bonus  To reward delivery of  short-term financial  targets and strategic  objectives, and the  individual performance  of the Executive  Directors in achieving  those. |  | • Annual bonus awards are discretionary and  determined by the Committee based on  performance in the year.  • Performance is measured against Group and  personal objectives set towards the start of  the year, covering financial and non-financial  measures (at least 60% of the bonus  opportunity normally being based on financial  factors).  • Delivered in cash and shares, which may be  deferred and/or subject to a holding period.  • The maximum annual bonus opportunity is  93% of Fixed Pay for the Group Chief  Executive and 90% of Fixed Pay for the  Group Finance Director.  • Although the Committee takes a structured  approach to considering the level of bonus  outcome each year, any bonus award is  discretionary and awards can be from zero to  the maximum.  • Awards are subject to malus and clawback  provisions (described in the risk and conduct  section). |  | In respect of 2023  performance year:  C.S. Venkatakrishnan’s  annual bonus was  £1,425,000 (53.3% of  maximum)  Anna Cross’s annual  bonus was £879,000  (54.3% of maximum) |  | C.S. Venkatakrishnan up  to 93% of Fixed Pay  Anna Cross up to 90% of  Fixed Pay  Performance measures  and weightings  unchanged from 2023,  save for the following:  In the Financial measures,  a total operating  expenses measure  replaces cost: income  ratio.  In the Strategic non-  financial measures, the  weightings for Customers  & clients, Colleagues and  Climate & sustainability  categories are reduced to  5%.  A new Risk &  operational excellence  category added with a  weighting of 10%. |
|  | Long Term Incentive Plan  (LTIP) award  To incentivise execution  of Barclays’ strategy  over a multi-year period,  encourage a long-term  view and align Executive  Directors’ interest with  those of shareholders. |  | • Awards are discretionary and determined by  the Committee based on satisfactory  performance in the year.  • Performance is measured over three years  against measures set by the Committee (at  least 70% of each award normally being  based on financial factors).  • Delivered in shares and subject to a holding  period, vesting no faster than permitted by  regulations (currently in five equal tranches,  from the third to the seventh anniversary of  grant).  • The maximum LTIP opportunity is 140% of  Fixed Pay for the Group Chief Executive and  134% of Fixed Pay for the Group Finance  Director.  • Although the Committee takes a structured  approach to considering the level of LTIP  outcome, any LTIP award is discretionary and  awards can be from zero to the maximum.  • Awards are subject to malus and clawback  provisions (described in the risk and conduct  section). |  | In respect of 2023  performance year:  C.S. Venkatakrishnan will  be granted a 2024-2026  LTIP award with a grant-  date face value of 140%  of Fixed Pay  Anna Cross will be  granted a 2024-2026  LTIP award with a grant-  date face value of 134%  of Fixed Pay  Performance measures  and weightings for the  2024-2026 LTIP cycle  have changed slightly  from those for the  2023-2025 LTIP cycle –  more information is  provided on page  [219](#i8958dfd3d5354840a56a1ffea7aeb8fe_320184)-[220](#i8958dfd3d5354840a56a1ffea7aeb8fe_320712).  In respect of the  2021-2023 LTIP cycle,  neither C.S.  Venkatakrishnan nor  Anna Cross were  participants. |  | C.S. Venkatakrishnan up  to 140% of Fixed Pay  Anna Cross up to 134% of  Fixed Pay  Performance weightings  and targets for the  2025-2027 LTIP will be  determined in early 2025. |
|  | All-employee share plans  To help increase the  number of employee  shareholders and  increase their  participation as  shareholders. |  | • Executive Directors are entitled to participate  in our UK all-employee share plans: Barclays  Sharesave and Barclays Sharepurchase. |  | Eligible to participate |  | Eligible to participate |
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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 202 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | Element and purpose |  | Operation |  | 2023 pay outcomes |  | Implementation for 2024 |
|  | Shareholding requirement  To further enhance the  alignment of  shareholders’ and  Executive Directors’  interests in long-term  value creation. |  | • Executive Directors are required to hold  shares with a value equivalent to their  maximum annual variable pay opportunity  (233% of Fixed Pay for the Group Chief  Executive and 224% of Fixed Pay for the  Group Finance Director), to be built up within  five years from their date of appointment.  • Post-employment shareholding  requirements apply for two years after  stepping down as an Executive Director. The  amount to be held is as described above, or if  lower the actual number of shares held on  the date the Executive Director steps down. |  | As at 31 December 2023:  C.S. Venkatakrishnan’s  shareholding was 227% of  his year-end Fixed Pay  (requirement to be met by  31 October 2026)  Anna Cross’s  shareholding was 118% of  her year-end Fixed Pay  (requirement to be met by  22 April 2027) |  | Shareholding  requirements remain  unchanged |
|  | Risk and conduct  adjustment – malus and  clawback  Malus and clawback  provisions discourage  excessive risk-taking and  inappropriate  behaviours. |  | • Annual bonus and LTIP awards are subject to  malus and clawback provisions.  • More detail is set out below. |  | Annual bonus and LTIP  awards granted in respect  of 2023 performance will  be subject to malus and  clawback provisions |  | Annual bonus and LTIP  awards granted in respect  of 2024 performance will  be subject to malus and  clawback provisions |

Risk and conduct (including malus and clawback)

Risk and conduct are taken seriously at Barclays. The Committee

ensures there are in-year adjustments, malus or clawback applied

to individual remuneration where appropriate.

All Executive Director annual bonus and LTIP awards are subject

to malus and clawback provisions. The purpose of these

provisions is to discourage excessive risk-taking and inappropriate

behaviours.

The malus provisions enable the Committee to reduce the

amount of unvested bonus or LTIP (including to nil) prior to

vesting in specified circumstances, including but not limited to:

– The individual in question deliberately misleading Barclays, the

market and/or shareholders in relation to the financial

performance of the Barclays Group

– The individual causing harm to Barclays’ reputation or where

his/her actions have amounted to misconduct, incompetence

or negligence

– A material restatement of the financial statements of the

Barclays Group or any subsidiary, or the Group or any business

unit suffering a material downturn in its financial performance

– A material failure of risk management in the Barclays Group

– A significant deterioration in the financial health of the Barclays

Group.

The clawback provisions enable amounts to be recovered after

they have vested, for a period in line with applicable regulations –

currently seven years from grant (which can be extended to up to

10 years in circumstances where a relevant investigation is

ongoing at the end of the initial seven-year period), in

circumstance where:

– The individual in question’s actions or omissions have

amounted to misbehaviour or material error, and/or

– Barclays or the relevant business unit has suffered a material

failure of risk management.

In addition to individual adjustments, the Committee considers

and makes collective adjustments to the incentive pool for risk

and conduct events. The Committee also adjusts the incentive

pool to take account of an assessment of future risks, including

conduct, non-financial factors that can support the delivery of a

strong risk management, control and conduct culture, and other

factors including reputation and impact on customers, markets

and other stakeholders. The Committee is supported in its

consideration of this by the Board Risk Committee. For 2023, the

total impact of risk and conduct-related collective adjustments is

a reduction of c.£185m (2022: c.£500m).

Discretion

In addition to the various operational discretions the Committee

can exercise in the performance of its duties (including those

discretions set out in the Company’s share plan rules), the

Committee reserves the right to make either minor or

administrative amendments to the Directors' Remuneration

Policy to benefit its operation or to make more material

amendments in light of new laws, regulations and/or regulatory

guidance. The Committee would only exercise this right if it

believed it was in the best interests of the Company, and where it

is not possible, practicable or proportionate to seek or await

shareholder approval at the next AGM.

In relation to the Executive Directors' annual bonus, the

Committee has discretion to determine the appropriate

performance conditions applying each year – provided that

financial factors will normally guide at least 60% of the bonus

opportunity.

Although the Committee takes a structured approach to

considering the level of annual bonus outcome for the Executive

Directors each year, any bonus award is discretionary and the

Committee has discretion to award any amount from zero to the

maximum value.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 203 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

In relation to the LTIP, the Committee again has discretion to

determine the appropriate performance conditions – provided

that financial measures will normally be at least 70% of the total

opportunity. In exceptional circumstances the Committee has

discretion to amend performance targets, measures or the

number of shares under awards, if circumstances occur that

cause the Committee to consider such adjustment to be

reasonable. The Committee also has the discretion to reduce the

vesting of any award, including to nil, if it deems the outcome

inconsistent with the performance delivered.

For 2023, the Committee did not exercise discretion to adjust the

variable pay outcomes as outlined on page [208](#i8958dfd3d5354840a56a1ffea7aeb8fe_320717).

Performance measures and targets

Measures

The performance measures and targets are set annually by the

Committee to align with our strategic priorities, ensuring the

measures support delivery of the Group’s strategy.

The Committee selects financial performance measures that are

fundamental to delivery against the Group’s strategy and are

considered to be the most important financial measures used by

the Executive Directors and the Board to oversee the direction of

the business. The non-financial performance measures are

chosen to represent key indicators of the success of our strategy,

and to provide a balanced view of our performance during the

period, which are robustly monitored and reported on to the

management team and the Board.

Targets

Targets for both the annual bonus and LTIP are calibrated to be

stretching but achievable, and are aligned with creating value for

shareholders and other stakeholders.

In respect of the annual bonus, the financial measures and

weightings are disclosed at the start of the relevant performance

year. The Committee considers the specific annual bonus targets

to be commercially sensitive, and that it would be detrimental to

disclose the targets at the start of the relevant performance year.

On that basis, the targets and performance against those targets

are disclosed at the end of the relevant performance year, in that

year’s Annual Report on Directors’ remuneration, provided that

commercial sensitivity is no longer an issue at that time.

In respect of the LTIP, the financial measures, weightings and

targets are disclosed in the Remuneration report published

immediately before the awards are granted – which is shortly after

at the start of the relevant performance period.

The Committee selects non-financial performance measures

that support the delivery of our strategy and reflect our priorities

over the next year or over a multi-year period.

ESG and remuneration

The Committee reviews the Executive Directors' incentive

measures each year to ensure they continue to support the

delivery of our strategic priorities, including ESG priorities.

The Executive Directors' annual bonus and LTIP have included

Climate & sustainability measures for over a decade. The

Committee aligns these measures each year with the Group's

evolving climate and sustainability ambitions, metrics and targets.

Most of our climate-related measures and targets are longer

term, including those relating to financing the transition and

financed emissions, and progress towards these targets is

expected to be variable and non-linear. This is reflected in a higher

weighting of Climate & sustainability measures in the LTIP,

compared to the annual bonus, as follows:

– For the 2024-2026 LTIP, 15% of the total opportunity will be

determined based on performance measures relating to

Climate & sustainability, measuring progress against each of

the three pillars of our climate strategy – including our ambition

to be a net zero bank by 2050 and our commitment to align our

financing with the goals and timelines of the Paris Climate

Agreement.

– For the 2024 annual bonus, 5% of the total opportunity will be

determined based on Climate & sustainability measures.

A further 5% of each of the 2024 bonus and the 2024-2026 LTIP

will be determined on Colleagues measures, including diversity,

inclusion and engagement. Risk & operational excellence

measures are weighted at 10% in the 2024 bonus and 5% in the

2024-2026 LTIP, as the management of risk underpins delivery

against our strategy and is a key part of the governance of the

Group. Outcomes will be determined based on an assessment of

performance against a range of measures of our risk culture,

operational precision and controls.

In recent years, the weighting of the Climate & sustainability

category in both the LTIP and annual bonus was equal, at 10%.

As described earlier, for this year's forward-looking incentives the

Committee increased the weighting to 15% in the 2024-2026

LTIP and decreased it to 5% in the 2024 annual bonus. Given the

higher maximum opportunity under the LTIP compared to  the

annual bonus, these changes equate to an increase in the total

value of remuneration that will be determined based on climate-

related measures.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 204 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

Illustrative scenarios for Executive Directors'

remuneration

The charts below show the potential value of the current

Executive Directors’ 2024 total remuneration in four scenarios:

‘Minimum’ (i.e. Fixed Pay, pension and benefits), ‘Mid-point’ (i.e.

Fixed Pay, pension, benefits and 50% of the maximum variable pay

that may be awarded), ‘Maximum’ (i.e. Fixed Pay, pension, benefits

and the maximum variable pay that may be awarded) and

‘Maximum with illustrative share price increase applied to

LTIP’ (the Maximum scenario, assuming share price appreciation

of 50% on the LTIP).

The value of benefits in these charts is based on an estimated

annual value for regular contractual benefits provision during

2024. Additional ad hoc benefits may arise but will always be

provided in line with the Directors' Remuneration Policy.

A significant proportion of the potential remuneration of the

Executive Directors is performance-related, delivered in Barclays

shares and subject to deferral, additional holding periods, malus

and clawback. These charts assume a constant share price, other

than for the share price appreciation applied to the LTIP value in

the 'Maximum with illustrative share price increase' scenario.

|  |
| --- |
|  |
| Group Chief Executive  £m |

![62672162794788]()

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| 0 | | 2 | | 4 | | 6 | | 8 | | 10 | | 12 | |

|  |
| --- |
|  |
| Group Finance Director  £m |

![62672162794825]()

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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| 0 | | 2 | | 4 | | 6 | | 8 | | 10 | | 12 | |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| n | Fixed Pay | n | LTIP |
| n | Pension and benefits1 | n | Potential outcome of a 50% share price  increase on the LTIP |
| n | Annual bonus |

Note:

1 Pension and benefits include the value of cash in lieu of pension and the anticipated value of taxable benefits.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 205 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Minimum | Total: 3.15 |  |  |  |  | |
| 93% | 7% |  |  |  |  |  |
| Mid-point |  |  | Total: 6.59 | |  |  |
| 45% | 3% | 21% |  | 31% |  |  |
| Maximum |  |  |  |  | Total: 10.02 |  |
| 29% | 2% |  | 28% |  | 41% |  |
| Maximum with illustrative share price increase applied to LTIP | | | | |  | Total: 12.08 |
| 24% | 2% |  | 23% |  | 34% | 17% |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Minimum | Total: 1.96 |  |  |  |  | |
| 94% | 6% |  |  |  |  |  |
| Mid-point |  |  | Total: 4.02 | |  |  |
| 46% | 3% | 20% |  | 31% |  |  |
| Maximum |  |  |  |  | Total: 6.09 |  |
| 30% | 2% |  | 27% |  | 41% |  |
| Maximum with illustrative share price increase applied to LTIP | | | | | | Total: 7.33 |
| 25% | 1% |  | 23% |  | 34% | 17% |

Alignment with Provision 40 of the UK Corporate Governance Code

|  |  |
| --- | --- |
|  |  |
| Code requirements | How the Committee has addressed the requirement |
| Clarity – remuneration arrangements should  be transparent and promote effective  engagement with shareholders and the  workforce | • A clear remuneration philosophy with aligned policies and practices for Executive Directors and  the wider workforce  • Our Fair Pay Report, which sets out how pay fairness is central to what we stand for, is used to  engage with our shareholders and our colleagues  • Regular engagement on remuneration with our largest institutional shareholders |
| Simplicity – remuneration structures should  avoid complexity and their rationale and  operation should be easy to understand | • Clear disclosure of rationale for and operation of each element of the Directors' Remuneration  Policy  • Executive Directors incentivised via annual bonus with deferral and LTIP  • Prospective disclosure of bonus metrics and LTIP targets, and full retrospective disclosure of  outcomes against financial and non-financial targets and criteria, with full supporting  commentary |
| Risk – remuneration arrangements should  ensure reputational and other risks from  excessive rewards, and behavioural risks that  can arise from target-based incentive plans,  are identified and mitigated | • Assessment of 'What' and 'How' performance is achieved  • Ex-ante and ex-post risk factored into the assessment of business performance  • Significant deferral into shares, to align with shareholder experience  • Committee discretion to adjust all variable remuneration outcomes  • Malus and clawback provisions apply to all elements of variable remuneration |
| Predictability – the range of possible values of  rewards to individual Directors and any other  limits or discretions should be identified and  explained at the time of approving the policy | • Maximum incentive outcomes set out in the Directors' Remuneration Policy  • Scenario charts illustrate potential payouts under each element of the Policy  • Key areas of Committee discretion clearly outlined in the Policy |
| Proportionality – the link between individual  awards, the delivery of strategy and the long-  term performance of the company should be  clear. Outcomes should not reward poor  performance | • Annual bonus and LTIP measures reviewed each year to maintain alignment to strategic  priorities and KPIs  • Very significant deferral into shares, to align with shareholder experience  • Committee discretion, malus and clawback provisions apply to all elements of variable  remuneration, to ensure outcomes do not reward poor performance |
| Alignment to culture – incentive schemes  should drive behaviours consistent with  company Purpose, Values and strategy | • The Committee reviews all policies and practices, including incentive schemes, ensuring  alignment to the Group's Purpose, Values, Mindset and conduct expectations  • A key aspect of remuneration philosophy is rewarding sustainable performance  • Executive Directors' bonus and LTIP based on a balanced scorecard of financial and non-  financial measures, with financial measures aligned to external financial targets and non-  financial measures aligned to supporting Customers & clients, Colleagues, and to the Group's  Climate & sustainability ambitions  • Commitment to pay fairness across the workforce  • Executive Director remuneration outcomes considered in the context of outcomes across the  wider workforce |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 206 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

#### Annual report on Directors’ remuneration

This section explains how our Directors’ Remuneration Policy was implemented for 2023

#### Executive

#### Directors

#### Single total figure for 2023 remuneration (audited)

The following table shows a single total figure for 2023 remuneration in respect of qualifying service for each Executive Director,

together with comparative figures for 2022.

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
|  |  | 1) Fixed Pay  £000 | 2) Pension  £000 | 3) Taxable  benefits  £000 | Total  fixed pay  £000 | 4) Annual  bonus  £000 | 5) LTIP  £0001 | Total  variable pay  £000 | Total  £000 |
| C.S. Venkatakrishnan | 2023 | 2,860 | 143 | 213 | 3,216 | 1,425 | — | 1,425 | 4,641 |
|  | 2022 | 2,767 | 138 | 343 | 3,248 | 1,949 | — | 1,949 | 5,197 |
| Anna Cross2 | 2023 | 1,788 | 89 | 17 | 1,894 | 879 | — | 879 | 2,773 |
|  | 2022 | 1,185 | 59 | 10 | 1,254 | 803 | — | 803 | 2,057 |

Notes:

1 No LTIP values are shown as neither C.S. Venkatakrishnan nor Anna Cross were participants in the 2020-2022 LTIP or the 2021-2023 LTIP cycle.

2 Anna Cross was appointed to the Board and as Group Finance Director on 23 April 2022. The remuneration shown for 2022 is in respect of her services as Group Finance Director during

2022.

#### Additional information in respect of each element

#### of pay for the Executive Directors (audited)

1) Fixed Pay

Fixed Pay is delivered 50% in cash, paid monthly, and 50% in shares, delivered quarterly. The shares are subject to a holding period, with

restrictions lifting over five years (20% each year).

More information on the Committee's considerations in respect of the Executive Directors' Fixed Pay is set out on page [217](#i8958dfd3d5354840a56a1ffea7aeb8fe_292855).

2) Pension

Executive Directors are paid cash in lieu of pension contributions equal to 5% of their Fixed Pay (equivalent to 10% of the cash element

of Fixed Pay). The pension cash allowance paid during 2023 was £142,958 for C.S. Venkatakrishnan and £89,375 for Anna Cross. No

other benefits were received by Executive Directors from any Barclays' pension plan.

3) Taxable benefits

Taxable benefits include private medical cover, life assurance, income protection, tax advice and the use of a Company vehicle and

driver when required for business purposes.

For C.S. Venkatakrishnan, the benefits figure also includes the cost to the Company of providing him with relocation support during

2023. This is in line with the Directors' Remuneration Policy and includes immigration assistance, home search support in London, and

temporary accommodation in London (which ended on 31 October 2023). Those costs came to c.£148,000, including the cost to

Barclays of paying the income tax and social security resulting from the provision of that relocation support. As referenced in the 2021

Remuneration report, temporary accommodation in London was provided to him for a period of up to two years, following his

appointment in November 2021 as Group Chief Executive.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 207 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

4) 2023 annual bonus

The bonus amounts included in the single total remuneration figures are the value awarded or scheduled to be awarded in Q1 following

the financial year to which it relates.

In determining the bonus in respect of 2023 performance, the Committee considered the performance achieved against the Financial

(60% weighting) and Strategic non-financial (25% weighting) performance measures that had been set to reflect Group priorities for

2023. Performance against each Executive Director's Personal objectives (15% weighting) for 2023 was assessed on an individual basis.

The outcome for each of the Financial measures was determined on a straight-line basis, between the outcome for threshold

performance – which was nil for the profit before tax measure or 20% for the cost: income ratio measure – and 100% for achievement

of maximum performance. A summary of the assessment is provided in the following table.

2023 annual bonus outcomes

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Measures | Weighting | Threshold | Maximum | 2023 actual | Outcome | | | |
| C.S. Venkatakrishnan |  | Anna Cross |  |
| Profit before tax (excluding  material items), with CET1 ratio  underpin | 50% | £5.8bn | £9.8bn | £7.484bn1 | 21.1% |  | 21.1% |  |
| Cost: income ratio (excluding  material items) | 10% | 63.5% | 59.0% | 63.1%1 | 2.7% |  | 2.7% |  |
| Strategic non-financial | 25% | Performance against strategic measures, organised around  three main categories: Customers & clients, Colleagues and  Climate & sustainability | | | 16.5% |  | 16.5% |  |
| Personal | 15% | Individual performance against the respective Executive  Director's personal objectives, assessed by the Committee | | | 13.0% |  | 14.0% |  |
| Total | | | | | 53.3% |  | 54.3% |  |
| Final 2023 annual bonus outcome approved by the Committee | | | | | 53.3% |  | 54.3% |  |

Note:

1 Material items excluded from the above measures consist of Q423 structural cost actions of £927m.

Based on the assessment outlined above, the Committee determined an overall formulaic bonus outcome for C.S. Venkatakrishnan

and Anna Cross that equates to £1,425,000, and £879,000 respectively. The Committee reflected on the appropriateness of these

outcomes for the 2023 annual bonus, in the context of the performance achieved against the Financial measures, Strategic non-

financial measures and Personal objectives. The Committee considered the underlying financial health of the Group, which is strong

and well-capitalised, and more holistically the performance and contribution of each Executive Director during 2023. The bonus

outcomes were considered in the context of those for the wider workforce – ensuring appropriate alignment both this year and over a

multi-year period – and also by comparing to historical outcomes for the Executive Directors in the context of performance each year.

The Committee believes that the overall 2023 bonus outcomes above are aligned appropriately with stakeholder considerations and

with the performance achieved. Based on this, the Committee concluded that no discretionary adjustment was warranted.

In line with the Directors' Remuneration Policy, and due to the regulations prohibiting dividend equivalents being paid on unvested

deferred share awards, the number of shares awarded to each Executive Director under the Share Value Plan (the Group's main

employee share plan for granting deferred bonus shares to employees) will be calculated using the share price at the date of award,

discounted to reflect the absence of dividends or dividend equivalents during the vesting period. The valuation will be aligned to IFRS 2,

with the market expectations of dividends during the deferral period being assessed by an independent adviser.

The table below details how the 2023 annual bonus award for each Executive Director will be delivered, along with the face value of the

2024-2026 LTIP award that will be granted alongside the deferred elements of the bonus. This shows the percentage that is in Barclays

shares for the annual bonus, and also for variable pay overall (the annual bonus and LTIP combined). Of the annual bonus award for C.S.

Venkatakrishnan, 86% will be delivered in Barclays shares, and 77% for Anna Cross. Including the 2024-2026 LTIP awards, a total of 96%

of C.S. Venkatakrishnan’s 2023 variable pay will be in Barclays shares, and 94% for Anna Cross.

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | Upfront cash bonus  £000 | Upfront bonus  shares  £000 | Deferred bonus  shares  £000 | Total annual bonus  £000 | Percentage of bonus  in shares | 2024-2026  LTIP award  £000 | Percentage of 2023  variable pay  in shares |
| C.S. Venkatakrishnan | 200 | 200 | 1,025 | 1,425 | 86% | 4,025 | 96% |
| Anna Cross | 200 | 200 | 479 | 879 | 77% | 2,412 | 94% |

The deferred bonus shares in respect of the 2023 annual bonus awards will vest in two equal tranches on the first and second

anniversaries of grant. All shares (both the upfront bonus shares and the deferred bonus shares) are also subject to a one-year holding

period from the point of vesting. All of the 2023 variable pay is subject to clawback provisions, which allow the Committee to recover

amounts that have been paid in certain circumstances, and the deferred elements are subject to malus provisions, which enable the

Committee to delay or reduce the vesting of unvested amounts (including reducing to nil) in certain circumstances.

Further detail follows on the assessment of the Strategic non-financial measures, and performance against Personal objectives where

applicable.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 208 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

Assessment of the Strategic non-financial measures for the 2023 annual bonus

The weighting of the Strategic non-financial element was 25%, within which the Customers & clients and Colleagues sections are each

weighted at 7.5% and the Climate & sustainability section is weighted at 10%. Progress in relation to each of the Strategic non-financial

measures was assessed by the Committee. The overall assessment was based on the following scale:

|  |  |  |
| --- | --- | --- |
|  |  |  |
| For Customers & clients and  Colleagues (max weighting 7.5%) | For Climate & sustainability  (max weighting 10%) | Overall outcome |
| 0% to 1% | 0% to 2% | Behind track on most measures |
| 1.5% to 3.0% | 2.5% to 4.5% | Slightly behind track on most measures |
| 3.5% to 6.0% | 5.0% to 7.5% | On track or slightly ahead of track for most measures |
| 6.5% to 7.5% | 8% to 10% | Ahead of track on most measures |

On this basis, the Committee agreed an overall outcome for the Strategic non-financial measures of 16.5% out of a maximum of 25%.

The detail supporting this assessment is provided in the table that follows. The measures used in the Strategic non-financial

assessment for bonus reflect key strategic priorities of the Group. Most outcomes are either measured by an external provider, such as

NPS or Investment Banking fee ranking and share, or are subject to independent ‘limited assurance’ by KPMG (indicated by the 'Δ'

symbol)1,  including Climate & sustainability measures.

Customers & clients

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Measure | Criteria | Performance | Commentary | Outcome |
| Global Markets  revenue ranking  and share | Maintain client rankings and  market share | 6th (maintained since 2022)  Revenue share decreased  to 6.5% (from 7.3% in 20222 | • Global Markets revenue ranking maintained with a slight  decrease in revenue share amidst a challenging  intermediation environment and compressed financing  spreads  • Share of wallet with our Global Markets top 100 clients  increased with income up 5%, despite lower client activity in  markets across the industry | Slightly behind  track |
| Investment  Banking fee  ranking and  share | 6th (maintained since 2022)  Fee share maintained  at 3.1%3 | • Maintained sixth ranking despite a year of suppressed  dealmaking  • In the UK, topped the investment banking league table –  in fees earned – for the first time in six years4 | On track |
| Net Promoter  Scores (NPS) | Improve | Barclays UK: +17  (2022: +11)  Barclaycard UK: +13  (2022: +12)  US Consumer Bank Digital  tNPS5: 61.3 (2022: 59.8) | • NPS score for Barclays UK increased to +17, up six points.  Personal customers with Blue or Premier accounts feel  more positive about their experience, but a decline in  Business Banking NPS means that improving these  relationships is a priority  • Barclaycard NPS continued to trend upward  • US Consumer Bank Digital tNPS increased with several  enhancements made to the customer digital experience,  including functionality for replacing lost and stolen cards  and the ease of user login | On track |
| Complaints | Reduce Barclays UK  customer complaints and  improve resolution time | BUK Total Complaints  (% movement year on year):  +18% | • Complaint volumes increased during 2023, driven by  specific issues encountered by customers and rising levels  of fraud and scams experienced across industry. A rigorous  plan is in place to address this and improve our proposition  and execution to best-in-class service  • 64% of complaints resolved within three days (2022: 61%) | Behind track |
| Digital | Increase digital engagement | Percentage of customer  journeys digitally enabled:  80% (2022: 76%)  Mobile active customers:  11.0m (2022: 10.5m)  CC&P US customer digital  engagement: 76.0%6 (2022:  74.1%) | • The number of active digital users has surpassed all other  UK banks 7  • Further improvements made to navigation and  functionality within the Barclays app  • The US Consumer business continued to invest in the  digital servicing model, including the introduction of new  and enhanced digital engagement features and technology  advancements. Digital active user rate increased  versus 2022 | On track |
| Total Customers & clients: 3.5% | | | | |

Notes:

1 2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410 Current and previous limited assurance scope and opinions can be found within the ESG

Resource Hub for further details <home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/>

2 Global Markets rank and revenue share based on Barclays’ calculations using peer-reported financials. Top 10 peer group includes Barclays, Bank of America, Citigroup, Goldman Sachs,

JPMorgan Chase & Co, Morgan Stanley, BNP Paribas, Credit Suisse, Deutsche Bank and UBS. Where any of the peer group has not published results by the time we report, we use the

consensus estimate for their quarterly performance.

3 Data from Dealogic for the period covering 1 January to 31 December 2023.

4 Data from Dealogic, UK Investment Bank revenue by bank, full year 2023.

5 USCB digital tNPS is a newly tracked metric measuring USCB customer experience at the digital journey level.

6 Excluding Gap customers.

7 The number one for digital users score is from Curinos – eBenchmarkers Analyser and internal analysis, and is from its April 2023 report .

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 209 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

Colleagues

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Measure | Criteria | Performance | Commentary | Outcome |
| Diversity | 33% females at Managing  Director and Director level  by 2025 | 30%Δ in 2023, increasing  from 29% in 2022 | • Continued to make progress towards 2025 Gender and  Underrepresented Race and Ethnicity Ambitions  • Achieved our Ambition to increase overall  underrepresented minority representation by 25% in the  UK and 20% in the US two years early. As at the end of  2023, underrepresented minorities represent 5.1% of the  total population in the UK and 21% of the total population in  the US. Ambition reset to achieve a further 12.5% increase  in the UK and 5% increase in the US by the end of 2025  • The number of Managing Directors from  underrepresented ethnicities largely unchanged versus  2022 | Slightly behind  track |
| Increase underrepresented  minority1 representation in  the UK to 5% and in the US  to 21% by 2025 | UK: 5.1% (2020 baseline of  4.0%)  US:  21.0% (2020 baseline of  18.1%) |
| 50% increase in the number  of Managing Directors from  underrepresented  ethnicities in the UK and the  US combined by 2025  (measured from 2022  baseline) | 55 Managing Directors  (2022 baseline of 56) |
| Inclusion | Improve inclusion indicators | Inclusion Index  from Your View survey  83% (2022: 82%) | • 90% of employees in Your View survey told us they feel  included in their team (2022: 88%)  • 85% of employees in Your View survey told us they believe  that senior leaders are truly committed to building a diverse  workforce (2022: 84%) | On track |
| Engagement | Maintain engagement at  healthy levels | Employee Engagement  score from Your View  survey 86% (2022: 84%)  86% of employees in  Your View survey would  recommend Barclays to  people they know as a  great place to work  (2022: 85%) | • Overall Wellbeing Index score from Your View survey of  88% (2022: 86%)  • Highest Engagement and Wellbeing index scores to date2  • 89% of employees in Your View survey told us that their line  managers are supporting their efforts to maintain their  wellbeing (2022: 90%) | Ahead of track |
| Culture | Maintain culture indicators | 94% of employees in  Your View survey believe  that they and their team  do a good job of role-  modelling the Values  every day (2022: 92%)  93% of employees in  Your View survey  believe that they and  their team do a good  job of role-modelling our  Mindset every day  (2022: 92%) | • As part of the culture change programme, Consistently  Excellent, the higher operating standard was incorporated  into our existing Values and Mindset behaviours and as part  of an enhanced set of leadership behaviours  • In the first Your View survey where we included questions  related to Consistently Excellent, 89% of employees told  us that they felt their peers “have a good understanding of  what it means to be a consistently excellent organisation”  • 83% of employees in Your View survey said they feel “it is  safe to speak up at Barclays” (2022: 83%)  • 62% of colleagues said it was “simple and straightforward  to get things done at Barclays”, a concept in line with one of  our key Consistently Excellent focus areas – although this  result shows that there is still more to be done in making  Barclays more efficient (2022: 60%) | Slightly ahead  of track |
| Total Colleagues: 5.5% | | | | |

Notes:

Δ    2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub: [home.barclays/](home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)

[sustainability/esg-resource-hub/reporting-and-disclosures/](home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)

1 Underrepresented minorities refer to individuals who are Black and Multiracial in the UK, and African American/Black, multiracial, Hispanic/Latinx, Native Alaskan/Native American, or

Native Hawaiian/Pacific Islander in the US.

2 On a comparable basis since the current measurement framework has been used (since 2019 for Engagement and since the introduction of the Wellbeing index in 2021).

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 210 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

Climate & sustainability

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Measure | Criteria | Performance | Commentary | Outcome |
| Sustainable and  Transition  Financing | Facilitate $1trn of  Sustainable and Transition  Financing between 2023  and end of 2030 | $67.8bnΔ | • Progress made towards Barclays' target to facilitate $1trn  of Sustainable and Transition Financing between 2023 and  end of 2030  • In 2023, developed a Group sustainable finance strategy  setting out the strategic focus for the Group in delivering  the $1trn target and our Transition Finance Framework,  which outlines the criteria for transactions to qualify as  transition financing | On track |
| Reducing our  financed  emissions | Deliver progress on our  commitment to align our  financing with goals and  timelines of the Paris  Climate Agreement:  30% reduction in power  portfolio emissions intensity  (Scope 1) by the end of  2025, from a 2020 baseline  15% reduction in energy  portfolio absolute emissions  (Scope 1, 2 and 3) by the end  2025, from a 2020 baseline | Power portfolio emissions  intensity: 241Δ KgCO2e/MWh,  26% down versus 2020  Energy portfolio absolute  emissions: 42.5Δ MtCO2e,  44% down versus 2020 | • Ahead of 2025 energy target and broadly on-track for  2025 power target  • Eight high-emitting sectors now covered by 2030 financed  emissions reduction targets, including the three sectors for  which new targets are being announced : Aviation, UK  Commercial Real Estate and UK Agriculture  • Future progress against these targets will be non-linear and  may be volatile due to the many external dependencies and  variables beyond Barclays’ control that may determine the  pace of transition and impact our ability to achieve our  targets | On track |
| Reducing our  greenhouse gas  (GHG) emissions | 90% reduction in Scope 1  and 2 GHG emissions  (market-based, against a  2018 baseline by end of  2025) | 93%Δ reduction | • Continued to reduce emissions in 2023, having achieved  our 90% GHG market-based emissions reduction target  for Scope 1 and Scope 2 in 2022 | Ahead of track |
| Renewable  electricity | 100% renewable electricity  sourcing for our global real  estate portfolio by end of  2025 | 100%Δ | • Continued to source 100% renewable electricity for our  global real estate portfolio operations1  • Maintained focus on improving energy efficiency and  replacing fossil-fuel-powered infrastructure with lower-  emission alternatives | Ahead of track |
| LifeSkills –  people upskilled | Upskill 8.7 million people  from 2023 to  end of 2027  with 2.6 million people  upskilled in 2023 | 2.6mΔ upskilled in 2023 | • From 2023, new investment through LifeSkills is focused  on targeted support for people in the most underserved  communities and underrepresented groups  • In 2023, the number of people upskilled was in line with our  per annum target | On track |
| LifeSkills –  people placed  into work | Place 250,000 people into  work (2023 to the end of  2027) | 53,500Δ people placed into  work in 2023 | • Exceeded our per annum target of 50,000 people placed  into work in 2023 | Slightly ahead  of track |
| Unreasonable  Impact  (partnership  with the  Unreasonable  Group) | Support an additional 200  businesses solving social  and environmental  challenges (2023 to the end  of 2027) | 41Δ ventures supported | • After achieving our goal to support 250 ventures by the  end of 2022, this strategic global partnership with  Unreasonable Group was renewed in 2023 to enable  Barclays to support an additional 200 entrepreneurs over  five years. More than 300 ventures have been  supported so far  • In 2023, the number of ventures supported met our per  annum target | On track |
| Total Climate & sustainability: 7.5% | | | | |
| Overall strategic non-financial outcome (out of a maximum possible 25%) | | | | 16.5% |

Notes:

Δ    2023 data subject to independent limited assurance under ISAE (UK) 3000 and ISAE 3410. Current limited assurance scope and opinions can be found within the ESG Resource Hub: [home.barclays/](http://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)

[sustainability/esg-resource-hub/reporting-and-disclosures/](http://home.barclays/sustainability/esg-resource-hub/reporting-and-disclosures/)

1 Global real estate portfolio includes offices, branches, campuses and data centres.

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| + | Further details on our approach to Key Performance Indicators are included in the Strategic report.  Refer to <home.barclays/sustainability/esg-resource-hub/> for more information on the ESG measures. |
|  |

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 211 |
|  | Governance |  |
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| Remuneration report (continued) | | | | | | | | | | |

Assessment of performance against the Personal objectives set for the 2023 annual bonus (15% weighting)

Individual performance against each of the Executive Directors’ personal objectives for 2023 (15% weighting overall) was assessed by

the Committee. Performance for C.S. Venkatakrishnan and Anna Cross was assessed against both the individual objectives set for their

respective roles and their shared personal objectives.

The table below summarises performance against the shared personal objectives.

Shared personal objectives for C.S. Venkatakrishnan and Anna Cross

|  |  |
| --- | --- |
|  |  |
| Objective | Outcomes |
| Deliver improving shareholder  returns, with a focus on RoTE | • Excluding Q423 structural cost actions, Group RoTE for 2023  remained aligned with our medium-term target  of greater than 10%, for the third consecutive year  • Group income of £25.4bn, up 3% year-on-year excluding the impact in 2022 of the Over-issuance of Securities,  against a challenging macroeconomic backdrop and significant market-wide declines for some business areas  • Total shareholder distributions in respect of 2023 equivalent to c.19.4p per share  • During 2023 a three-year plan was developed, through to 2026, designed to deliver further value for  shareholders and improve operational and financial performance; this is now being implemented |
| Maintain robust capital ratios  across the Group and within the  main operating entities | • Strong capital position maintained, with Group CET1 of 13.8%, within our target range of 13% to 14%  • Similarly strong capital ratios prevail in all main operating entities: at the end of 2023, Barclays Bank PLC’s CET1  ratio was 12.1% and Barclays Bank UK PLC’s CET1 ratio was 14.8%, well in excess of regulatory minimums |
| Continue to invest in capabilities  to deliver next-generation,  digitised consumer financial  services | • Number of active digital users is higher than for any other UK bank1  • Maintained focus on ensuring that digital banking with Barclays UK is smooth, easy and rewarding by making  further improvements to the navigation and functionality within the app and enabling 80% of customer  transactions across all Barclays UK channels to be completed digitally  • Improvements made to our digital offering for USCB customers helped boost the Android app star rating to 4.7  out of 5 in 2023, up from 4 in 2022, and increased our USCB Digital tNPS2  from 59.8 in 2022 to a full year  average of 61.3 in 2023 |
| Continue to deliver sustainable  growth in the Corporate and  Investment Bank | • Share of wallet with our top 100 Global Markets clients grew, with income from these clients up 5% year on year,  despite lower client activity in markets across the industry  • Despite a decline in fee income due to the reduced fee pool across the industry, Investment Banking continued  to deliver for clients - including leadership in high profile IPOs, e.g. ARM, the largest IPO to price in 2023.  Investment Banking maintained its sixth rank globally and improved its ranking in the UK to #13  • Corporate Banking revenues grew off the back of elevated deposits income which continued to benefit from a  strong net interest margin, and increased deposit balances with clients |
| Actively deploy the range of  Barclays’ businesses and  capabilities to support customers  and clients and capture  opportunities as we collectively  transition to a low-carbon  economy | • Facilitated $67.8bn of Sustainable and Transition Financing in 2023, against our target to facilitate $1trn by the  end of 2030, and published a Transition Finance Framework for Barclays  • In support of our Sustainable and Transition Financing target, formed a new Energy Transition Group,  comprising our Energy, Power and Sustainable Impact Banking teams  • Advised and helped companies raise capital for emerging climate technology, including Nextracker’s IPO and  first Follow-on Offering  • Continued to develop green and sustainable banking products for business clients, including the new Green  Barclayloan and, in partnership with Propel, a reduced fixed rate to business clients who take out finance on  environmentally friendly purchases  • Extended the Greener Home Reward to 2024, enabling eligible residential mortgage customers to make energy  efficiency-related home improvements  • Named Best Bank for Environment, Social and Governance (ESG) in the UK for 2023 by Euromoney |
| Continue to drive our data  strategy and technology agenda  across the Group to support  improving customer and client  services and experience | • Continued to use and enhance data and insights to ensure our strategy, products and services for retail  customers deliver the intended outcomes, with a focus on meeting the needs of people with vulnerable  characteristics  • Barclaycard Payments introduced new digital features – including the launch of Smartpay Anywhere and  Smartpay Fuse, enabling small business customers to take online payments as part of a seamless experience  • Continued to invest in enhancing our Corporate Banking digital capabilities globally to provide our clients with  seamless access to our transaction banking product set |

Notes:

1 The number one for digital users score is from Curinos – eBenchmarkers Analyser and internal analysis, and is from its April 2023 report.

2 A newly tracked metric for USCB measuring customer experience at digital journey level.

3 Data from Dealogic, global data based on full-year 2023, UK data based on full-year 2023 UK Investment Bank revenue by bank.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 212 |
|  | Governance |  |
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| Remuneration report (continued) | | | | | | | | | | |

In addition to the shared personal objectives described above, the table below summarises performance against the personal

objectives for C.S. Venkatakrishnan.

Personal objectives for C.S. Venkatakrishnan

|  |  |
| --- | --- |
|  |  |
| Objective | Outcomes |
| Ensure a continued focus on  customer and client outcomes | • Continued to transform our physical support model in 2023, including by expanding Barclays Local (the largest  network of alternative branch formats in the UK, for Barclays UK customers who need in-person support) by  more than 159 new sites, to a total of 351 sites, as well as continuing to provide services through innovative new  Shared Banking Hubs  • Broadened the Group’s UK mortgages proposition through the acquisition of Kensington Mortgage Company,  the UK’s leading residential specialist mortgage lender, known for its support of specialist customer groups and  the intermediary market  • Engaged extensively with customers to get regular insights to inform our design principles and the  transformation of our customer journeys, including 1.4 million pieces of customer feedback obtained in Barclays  UK in 2023  • Some progress made in addressing the volume of Barclays UK customer complaints with more work to do to  improve the overall customer experience and address and remove the root causes of customer complaints  • Successfully completed the transfer of UK Wealth Management & Investments business to sit alongside the  Private Bank, with the transition of 300,000 clients and 1,000 colleagues  • Improved  support to financially vulnerable customers by enhancing tools, training, support and systems |
| Continue to embed the Mindset  across the organisation in support  of our Purpose | • Increased the number of colleagues who believe that they and their team do a good job of role modelling our  Mindset every day (2023: 93%; 2022: 92%; 2021: 89%)  • Continued the design, delivery and embedment of the Group-wide cultural change programme, Consistently  Excellent, which challenges colleagues to address five key areas – Precision, Service, Focus, Efficiency and  Diversity of Thought – and ensured delivery to this standard is incorporated into our key processes for  attracting, retaining and developing talent, planning for succession, and recognising and rewarding performance |
| Continue to develop a high-  performing culture in line with our  Values, with a focus on employee  engagement, succession  planning, talent and diversity | • Colleague engagement increased across the Group to 86%, an increase of 2% points versus 2022, with the  annual Your View survey also showing positive results across most other measures  • Inclusion Index score for 2023 was 83%, continuing its upward trajectory since it was launched in 2020, with 90%  of colleagues telling us that they feel included in their team  • Continued to make progress towards our 2025 Gender and Underrepresented Race and Ethnicity Ambitions,  increasing senior female representation globally and representation of underrepresented minority groups in the  UK and the US |
| Effectively manage relationships  with key external stakeholders,  including societal stewardship | • Venkat has built strong connections and proactively collaborated with UK and US regulators throughout the  year, working to support the broader UK economy  • In 2023, our societal programmes reached more than 3.27 million people around the world, helping to unlock the  skills and employment opportunities people need to progress |
| Drive leadership accountability to  further strengthen our risk  management and controls culture | • Continued the design, delivery and embedment of the Group-wide cultural change programme, Consistently  Excellent, which includes a focus on risk awareness and operational excellence  • Consistently Excellent workshops have been delivered to senior leaders during 2023, and in 2024 all other  colleagues will be invited to attend, to ensure that there is a common understanding of what it means to deliver  to a consistently excellent standard  • Progress in embedding the new operating standard with colleagues has been reflected in the results from the  Autumn 2023 Your View survey, where 89% of colleagues felt their peers “have a good understanding of what it  means to be a consistently excellent organisation” |

Recognising C.S. Venkatakrishnan's very strong performance against both his individual and shared personal objectives, and his

leadership of the organisation through 2023 – including the embedment of a new operating standard, Consistently Excellent – the

Committee assessed that an outcome of 13% out of a maximum of 15% was appropriate.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 213 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

The table below summarises performance against the personal objectives for Anna Cross.

Personal objectives for Anna Cross

|  |  |
| --- | --- |
|  |  |
| Objective | Outcomes |
| Support the business to grow  sustainably, in line with the  Group’s strategy, with specific  focus on climate, capital and costs | • Maintained cost discipline. Excluding the Q423 structural cost actions in 2023 and the impact in 2022 of the  Over-issuance of Securities, the 2023 cost: income ratio was 63%, as the Group delivered positive cost: income  jaws of 1%  • Strong capital position maintained, with Group CET1 of 13.8% at the end of 2023, balanced with delivering total  cash returns to shareholders and investment in the business  • Instrumental in defining the future strategic priorities in the lead up to the Investor Update |
| Continue to optimise financial  management reporting  (particularly through technology)  to drive benefits across the Group  and to ensure a smooth transition  to new rules and regulations | • Leveraged technology to enhance the delivery of financial management reporting, including Group Balance  Sheet reporting and Internal Reporting, increasing efficiency and automation  • The Basel IV programme is on track to be completed in required timeframes |
| Continue to progress the  transformation of the Treasury  function, including strategic  treasury and liquidity platforms | • Continued improvements in Liquidity Reporting Infrastructure, including migration of additional reporting onto  core architecture, resulting in improved controls  • Progress made in the strategic transformation of Asset and Liability Management and Hedge Accounting  infrastructure to improve precision in our operations, risk management and controls |
| Oversee the effective  management of the risk and  controls agenda across Group  Finance, and transform for the  future where necessary | • Control Environment and Management Control Approach overall rated satisfactory in 2023 |
| Retain focus on the colleague  agenda across Group Finance –  driving employee engagement,  continuing to improve diversity,  developing senior talent and  succession planning | • High level of colleague engagement across Finance, at 85% (2022: 85%)  • Continued focus on embedding the Barclays Mindset with high scores on all three indices: Empower at 87%  (2022:89%); Challenge at 84% (2022:85%); and Drive at 88% (2022:87%)  • Senior female representation increased to 34% in Group Finance with half the roles on the Finance  Management Team occupied by females as at the end of 2023 |
| Effectively manage relationships  with key external stakeholders  including regulators and investors | • Established effective and open relationships with regulators and the investment community |
| In addition to the personal objectives set for Anna Cross at the start of 2023, at times during the year she carried out some responsibilities (both  internally and externally) that are usually performed by the Group Chief Executive, due to his illness. | |

The Committee recognised the high level of achievement during 2023 against these objectives, and also the additional responsibility

taken on at times due to the Group Chief Executive's illness, as outlined in the table above. Based on Anna Cross's strong performance

against both her individual and shared personal objectives, and her strong leadership through 2023, the Committee assessed that an

outcome of 14% out of a maximum of 15% was appropriate.

5) Vesting of the 2021-2023 LTIP cycle for the current Executive Directors

No LTIP awards were granted to C.S. Venkatakrishnan and Anna Cross in 2021 as they were not Executive Directors at that time.

Vesting of the 2021-2023 LTIP cycle for other participants

Former Group Finance Director Tushar Morzaria is the only remaining participant in the 2021-2023 LTIP cycle, having been granted an

award in March 2021 while he still served as an Executive Director.

The Committee assessed performance against the performance conditions for that LTIP award, based on performance over the

period from 1 January 2021 to 31 December 2023, with straight-line vesting applied between the threshold and maximum targets

shown for the financial measures. The Committee determined that 53.2% of the award will vest, as detailed in the table that follows.

Before finalising the vesting, the Committee considered whether this outcome was appropriate in the context of the performance

achieved, and concluded that it was – and that no further discretionary adjustment was warranted.

The vesting portion of the award will be released in five equal annual tranches, starting from March 2024. After release, each tranche of

shares is subject to an additional 12-month holding period.

The value that Tushar Morzaria is expected to receive from the vesting of this award is £1,174,634, estimated (as this 2023 Annual

Report will be finalised prior to the vesting date) using the Q4 2023 average share price of £1.4374 (which includes 18% share price

depreciation since the date of grant). The performance achieved against the performance targets is shown in the table that follows.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 214 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

2021-2023 LTIP outcomes

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Performance measure | Weighting | Threshold | Maximum vesting | Actual | % of award  vesting |
| 2023 return on tangible  equity (RoTE) (excluding  material items)1, 2 | 25% | 0% of award vests for RoTE of 6.0%,  rising on a straight-line basis | 25% of award vests for RoTE of 12.0% | 10.8% | 20.0% |
| Average cost: income ratio  (excluding material items)3 | 10% | 0% of award vests for average cost:  income ratio of 65.0%, rising on a  straight-line basis | 10% of award vests for average cost:  income ratio of 62.0% | 64.1% | 3.0% |
| Maintain CET 1 ratio within  the target range | 10% | If CET1 is below MDA hurdle4+180bps  during the period, the Committee will  consider what portion of this element  should vest, based on the causes of the  CET1 reduction  If CET1 is above MDA hurdle +280bps  but does not make progress towards  the range over the period, the  Committee will consider what portion of  this element should vest, based on the  reasons for the elevated levels of CET1  versus target range and the associated  impacts | CET1 ratio between 180bps and 280bps  above MDA hurdle throughout the period,  or CET1 ratio more than 280bps above  MDA hurdle but making progress towards  the target range during the period | Within  range | 10.0% |
| Relative total shareholder  return5 | 25% | 6.25% of award vests for performance  at median of the peer group6, rising on  a straight-line basis | 25% of award vests for performance at or  above the upper quartile | Below  median | 0.0% |
| Risk scorecard | 10% | The Risk scorecard captures a range of risks and reflects the considerations within the incentive  risk alignment framework shared with regulators. The current framework measures  performance against three broad categories – Capital & liquidity, Control environment and  Conduct – using a combination of quantitative and qualitative metrics | | | 6.0% |
| Climate | 10% | Performance is measured on progress towards our ambition to be a net zero bank by 2050  including:  • our commitment to align our financing with the goals of the Paris Climate Agreement  • our commitment to facilitate £100bn of green financing by 2030  The Committee determined the percentage of the award that may vest between 0% and 10% | | | 7.5% |
| Strategic non-financial | 10% | Performance is measured against the Strategic non-financial measures. The Committee  determined the percentage of award that may vest between 0% and 10%. The measures are  organised around three categories: Customers & clients, Colleagues, and Society (Citizenship).  Each of the three main categories has equal weighting | | | 6.7% |
| Total |  |  | |  | 53.2% |
| Final  2021-2023 LTIP vesting outcome approved by the Committee | | | |  | 53.2% |

Notes:

1 Using average tangible shareholders’ equity based on a CET1 ratio of 13.5%.

2 Material items consist of Q423 post-tax structural cost actions (2023: £739m).

3 Material items consist of certain structural cost actions (2023: £927m taken in Q423; 2022: £151m, 2021: £648m). The litigation and conduct impacts from the Over-issuance of

Securities and the devices settlements are not excluded.

4 Currently 12%.

5 Performance assessed over the period from 1 January 2021 to 31 December 2023. Start and end total shareholder return data is the Q4 average for 2020 and 2023 respectively and is

measured in GBP for each company.

6 The peer group is comprised of banks in Europe and North America of comparable size to Barclays and whose weekly returns have a high degree of correlation with Barclays'. The peer

group for the 2021-2023 LTIP award was Banco Santander, Bank of America, BBVA, BNP Paribas, Citigroup, Credit Agricole, Credit Suisse, Deutsche Bank, HSBC, ING Group, Lloyds

Banking Group, Morgan Stanley, NatWest Group, Societe Generale, Standard Chartered, UBS, and UniCredit.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 215 |
|  | Governance |  |
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| Remuneration report (continued) | | | | | | | | | | |

LTIP awards granted during 2023

Awards were granted to C.S. Venkatakrishnan and Anna Cross on 8 March 2023 under the 2023-2025 LTIP, based on a value per share

of £1.32067, which was derived from the share price less a discount to reflect the absence of dividends or equivalents during the

vesting period, in accordance with the Directors' Remuneration Policy. This is the value used to calculate the number of shares below.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | % of Fixed Pay | Number of shares | Face value at grant | Performance period |
| C.S. Venkatakrishnan | 140% | 2,946,989 | £3,892,000 | 2023-2025 |
| Anna Cross | 134% | 1,750,247 | £2,311,499 | 2023-2025 |

The performance measures for the 2023-2025 LTIP awards are as follows:

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Performance measure | Weighting | Threshold | Maximum vesting |
| Average return on tangible  equity (RoTE) (excluding  material items)1 | 25% | 0% of award vests for RoTE of 8.0%, rising on a straight-line basis | 25% of award vests for RoTE of 12.5% or  higher |
| Average cost: income ratio  (excluding material items) | 10% | 0% of award vests for average cost: income ratio of 62.5%, rising on a  straight-line basis | 10% of award vests for average cost:  income ratio of 58.0% or lower |
| Maintain CET 1 ratio within the  target range2 | 10% | If CET1 is below the target range during the period, the Committee  will consider what portion of this element should vest, based on the  reasons for the CET1 shortfall  If CET1 is above the range and does not make progress towards the  range over the period, the Committee will consider what portion of  the element should vest, based on  the reasons for the elevated  levels of CET1 versus target range and the associated impacts | 10% vests if either:  •  CET1 is within the range during the  period  or  • CET1 is above but making progress  towards the target range |
| Relative total shareholder  return 3 | 25% | 6.25% vests for performance at the median of the peer group4, rising  on a straight-line basis | 25% of award vests for performance at or  above the peer group4 upper quartile |
| Strategic non-financial | 20% | The evaluation will focus on key performance measures, w ith a detailed retrospective narrative on progress  against each category throughout the period. Performance against the strategic non-financial measures will be  assessed by the Committee to determine the percentage of the award that may vest between 0% and 20%. The  measures are organised around three main categories and measures will likely include, but not be limited to, the  following:  Climate & sustainability (weighted 10%) – progress to be measured against four key objectives: progress towards  our Sustainable and Transition Financing target; reduce our financed emissions; reduce our operational  emissions; and support our communities  Customers & clients (weighted 5%) – drive world-class outcomes for customers and clients; Improve Net  Promoter Scores; reduce Barclays UK customer complaints and improve resolution time; maintain client  rankings and market share within CIB; and increase digital engagement  Colleagues (weighted 5%) – protect and strengthen our culture through our Purpose, Values and Mindset;  Continue to improve diversity in leadership roles; improve inclusion indicators; maintain engagement at healthy  levels; and maintain culture and conduct indicators | |
| Risk scorecard | 10% | The Risk scorecard captures a range of risks and reflects the considerations within the incentive risk alignment  framework shared with regulators. The current framework measures performance against three broad  categories – Capital & liquidity, Control environment and Conduct – using a combination of quantitative and  qualitative metrics. The framework may be updated from time to time in line with the Group’s risk strategy.  Specific targets within each of the categories are deemed to be commercially sensitive. Retrospective narrative  on performance will be disclosed in the 2025 Remuneration report, subject to commercial sensitivity no longer  remaining | |

Notes:

1 Using average tangible shareholders’ equity based on a CET1 ratio at the mid-point of the Group target range 13% to 14%.

2 Currently 13.8%.

3 Performance assessed over the period from 1 January 2023 to 31 December 2025. Start and end total shareholder return data will be the Q4 average for 2022 and 2025 respectively

and will be measured in GBP for each company.

4 The peer group is comprised of banks in the UK, Europe and North America of comparable size to Barclays and whose weekly returns have a high degree of correlation with Barclays’.

The peer group for the 2023–2025 LTIP award is: Banco Santander, Bank of America, BBVA, BNP Paribas, Citigroup, Credit Agricole, Credit Suisse, Deutsche Bank, HSBC, ING Group,

Lloyds Banking Group, Morgan Stanley, NatWest Group, Societe Generale, Standard Chartered, UBS, and UniCredit.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 216 |
|  | Governance |  |
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| Remuneration report (continued) | | | | | | | | | | |

Executive Directors:

#### Statement of implementation of remuneration policy in 2024

An overview of how the Directors' Remuneration Policy will be implemented in 2024 is provided alongside the summary of the policy on

page [201](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686053725).

2024 Fixed Pay and market competitiveness of the Executive Directors’ total compensation opportunity

Pay benchmarking data is used as a reference point to ensure that the total compensation opportunity provided to the Executive

Directors is appropriately positioned compared to other similar large and complex international banks.

Comparing the Executive Directors' pay solely with other UK-listed banks would not recognise the Group's global footprint and

diversified universal banking model, which includes significant corporate banking, investment banking and global markets businesses.

The international banking peer group used by the Committee when considering the Executive Directors' pay therefore includes other

large universal banks from continental Europe, and the large US universal and investment banks. Around half of the peer group are US-

based, as these are among the most relevant comparators given their business mix and also form part of the peer group used internally

when comparing the Group's performance. Barclays actively competes with those US-based peers for talent, which is reflected in

several current and former Executive Directors having been recruited into Barclays from those firms. The Committee also recognises

that some of those peers are larger than Barclays, and that market pay levels for executive directors of US companies are often higher

than those of UK companies. To help maintain balance, the international banking peer group also includes the larger UK-listed banks

most comparable to Barclays.

An annual review of the Executive Directors' Fixed Pay, in the same way and at the same time as for the wider workforce, is a feature of

the Directors' Remuneration Policy approved by shareholders in 2023. In February 2024 the Committee reviewed the Fixed Pay for each

Executive Director as part of the year-end pay review process for colleagues across the Group. The Committee considered the

maximum total compensation opportunity of each Executive Director, driven by their respective levels of Fixed Pay, and noted that in

each case the total compensation opportunity is materially less than the median of that offered for comparable roles in our

international banking peer group. The Committee considered this relative market positioning in the context of the robust performance

and significant personal contribution made by each of the Executive Directors, and determined that Fixed Pay would be increased by

2.5% for both C.S. Venkatakrishnan and Anna Cross – to £2,947,000 and  £1,845,000 respectively, effective 1 March 2024. The

Committee noted that these are lower percentage increases than the average fixed pay increase for the wider workforce, and in

particular for UK employees within the scope of the 2024 UK pay deal with the union Unite – with a 5.55% budget for salary increases for

junior UK employees and a 3.75% budget for other union-recognised employees. To align the Executive Directors' interests with those

of shareholders, half of Fixed Pay for each Executive Director is delivered in shares, which are granted quarterly and released in

instalments over five years. The other half of their Fixed Pay is delivered in cash, paid monthly via payroll in the same way as salary for

other employees.

The following charts compare each Executive Director's maximum total compensation opportunity for 2024 against the equivalent

opportunity across international banking peers. This shows that, even after these Fixed Pay increases, the maximum total

compensation opportunity is significantly behind international banking peers, falling between the market lower quartile and median for

C.S. Venkatakrishnan and slightly below lower quartile for Anna Cross.

The charts also show a comparison of the maximum total compensation opportunity of each Executive Director with the equivalent

roles at the companies that make up the FTSE 30 (i.e. the 30 largest FTSE 100 constituents by market capitalisation). This shows that

the Executive Directors’ maximum total compensation opportunity is more competitive, but not inappropriate, compared to the FTSE

30 group. The Committee noted that it would be unlikely for the Group to fill either of the Executive Director roles by recruiting from the

other FTSE 30 companies, recognising the necessity for candidates for these roles to have the right breadth and depth of banking

knowledge and experience – particularly given Barclays’ mix of businesses, as outlined above. However, this comparison is provided

alongside the international banking peer group to provide additional UK context.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 217 |
|  | Governance |  |
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| Remuneration report (continued) | | | | | | | | | | |

Executive Director maximum total compensation opportunity relative to market benchmarks

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| --- | --- |
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| Group Chief Executive  C.S. Venkatakrishnan | |

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| International banking peer group | |

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| FTSE 30 | |

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| n | | Bottom quartile | n | 3rd quartile | n | 2nd quartile | n | Top quartile |
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|  |  | Positioning of maximum total compensation opportunity at Barclays relative to market benchmarks | | | | | | |
|  |  |  |  |  |  |  |  |  |

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| --- | --- |
|  |  |
| Group Finance Director  Anna Cross | |

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| --- | --- |
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| International banking peer group | |

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|  |

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| --- | --- |
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| FTSE 30 | |

Notes

• Barclays and market benchmark data reflect maximum total compensation opportunity, excluding pensions and benefits.

• Benchmark data for the international banking peer group and FTSE 30 was provided by Willis Towers Watson, based on publicly disclosed data in respect of each company's 2022 or

2022/23 financial years, incorporating assumptions where companies do not disclose a maximum total compensation opportunity.

• Barclays’ international banking peer group currently comprises the following international banks: Bank of America, BNP Paribas, Citigroup, Deutsche Bank, Goldman Sachs, HSBC

Holdings, JPMorgan Chase & Co, Lloyds Banking Group, Morgan Stanley, Standard Chartered, and UBS Group.

2024 annual bonus performance measures

Performance measures with appropriately stretching targets were selected to cover a range of financial and non-financial goals that

support the key strategic objectives of the Group.

For the 2024 annual bonus, slight amendments were made to the performance measures compared to the 2023 annual bonus:

–Within the Financial measures, total operating expenses replaces cost: income ratio, reflecting the continued importance of cost

discipline while providing a more focused and simpler measure of cost control within the year.

–Within the Strategic non-financial measures, the weightings for the Customers & clients and Colleagues categories are each reduced

from 7.5% to 5%, and the weighting for the Climate & sustainability category is reduced from 10% to 5%. Those reductions

accommodate the introduction of a Risk & operational excellence measure, weighted at 10% – reflecting the focus on risk, control

and operational excellence.

The other measures were largely unchanged. Performance measures and weightings are shown below:

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Performance measure | Weighting | Metrics |
| Financial measures | | |
| Profit before tax (excluding  material items)1 | 50% | A performance target range has been set for this financial measure, which will be disclosed in the next  Remuneration report. Pay-out of this element will also depend on the CET1 ratio at the end of the  performance year. In line with regulatory requirements, if the CET1 ratio is below the MDA hurdle at the  end of the performance year, the Committee will consider what part if any of this element should pay  out. |
| Total operating expenses at  specific FX (excluding material  items)1 | 10% | A performance target range has been set for this financial measure, which will be disclosed in the next  Remuneration report. The measure is tied to a specific USD:GBP exchange rate to minimise the impact  of FX volatility. |
| Strategic non-financial measures  The evaluation will focus on a range of key metrics, with a detailed retrospective narrative on progress against each during the year. Performance  against the measures will be assessed by the Committee to determine the percentage of the award that may vest between 0% and 25%. The  measures are organised around four main categories and measures will likely include the following: | | |
| Climate & sustainability | 5% | Progress to be measured against four key objectives:  • Progress towards our Sustainable and Transition Financing target  • Reduce our financed emissions  • Reduce our operational emissions  • Support our communities |
| Customers & clients | 5% | Drive world-class outcomes for customers and clients:  • Improve Net Promoter Scores  • Reduce Barclays UK customer complaints and improve resolution time  • Maintain rankings and market share within Barclays Investment Bank  • Increase digital engagement |
| Note  1 Material items are defined as those large atypical one-offs that are called out in the financial reporting. As in previous years, the exclusion is not automatic, and the Committee will  determine whether each item should be treated as material for these purposes at the time that outcomes are determined. | | |

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 218 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

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| Performance measure | Weighting | Metrics |
| Colleagues | 5% | Protect and strengthen our culture through our Purpose, Values and Mindset:  • Continue to improve diversity in leadership positions  • Improve inclusion indicators  • Maintain engagement at healthy levels  • Maintain culture indicators |
| Risk & operational excellence | 10% | Support a consistently excellent operating standard, risk management and controls  Performance measured against two categories – Operational excellence and Risk & conduct – using a  combination of quantitative and qualitative metrics |
| Personal objectives | | |
| Personal objectives | 15% | Joint personal objectives:  • Deliver new financial targets including RoTE and capital distributions  • Maintain robust capital ratios across the Group and within the main operating entities  • Continue to simplify the organisation in terms of its operations and financial reporting  • Deliver better customer outcomes, income quality and investment priorities across our businesses  • Demonstrate progress towards reallocating capital to the highest returning businesses  • Continue to drive the sustainability strategy of the bank to achieve our ambition to be a net zero bank  by 2050  C.S. Venkatakrishnan:  • Continued focus on customer and client outcomes  • Drive delivery to a consistently excellent standard  • Continue to develop a high-performing culture in line with our Values and Mindset, with a focus on  employee engagement, succession planning, talent and diversity  • Effectively manage relationships with key external stakeholders  • Drive leadership accountability to further strengthen our risk management and controls culture  Anna Cross:  • Continue to simplify, standardise and automate Finance and Treasury processes to improve  effectiveness and efficiency  • Appropriate management of capital and resources using oversight committees to ensure we comply  with governance and regulatory requirements  • Effectively manage relationships with key external stakeholders, including regulators and investors  • Oversee the effective management of the risk and control across Group Finance, ensuring we take  full ownership of our end-to-end processes  • Retain focus on the colleague agenda across Group Finance - driving employee engagement,  continuing to improve diversity & inclusion, developing senior talent and succession |

2024-2026 LTIP awards and performance measures

The Committee decided to grant awards under the 2024-2026 LTIP cycle to C.S. Venkatakrishnan and Anna Cross with face values at

grant equal to 140% and 134% of Fixed Pay respectively – which will be based on Fixed Pay before applying the 1 March 2024 increases

outlined earlier in this Remuneration report. Those maximum award multiples are in line with those for 2023. These share-based awards

ensure alignment with future performance over the three-year assessment period, as well as share price alignment over the long

release period (up to eight years from initial date of grant).

For the 2024-2026 LTIP, changes were made to the financial and non-financial performance measures, compared to the 2023-2025

LTIP cycle granted early in 2023. Within the Financial measures, the weighting of RoTE was increased slightly, from 25% to 30%, given

that improving RoTE is a key part of the Group's priorities and revised targets, as set out in the 'Our strategy' section from page [11](#i4be61753b7f243b19551b0bfbf3a2a0d_10551). This

was accommodated via a small reduction to the weighting of relative total shareholder return from 25% to 20%. The RoTE measure is

based on RoTE performance achieved in 2026, aligned with the Group's revised targets. This is underpinned by a requirement based on

average RoTE across the performance period, to ensure an appropriate level of RoTE is maintained throughout.

Within the Strategic non-financial measures, the Climate & sustainability weighting is increased from 10% to 15%. To accommodate

this, the weighting of the risk-related measure – which this year also incorporates assessment of operational excellence – is reduced

from 10% to 5%. The other measures are largely unchanged.

The Group's Climate & sustainability targets are longer term, through to 2050, and progress towards these targets is expected to be

variable and non-linear – hence the increased weighting of Climate & sustainability in the 2024-2026 LTIP and reduced weighting in the

2024 annual bonus.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 219 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

The 2024-2026 LTIP award will be subject to the following forward-looking performance measures.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Performance measure | Weighting | Threshold | Maximum vesting |
| Financial measures | | | |
| 2026 RoTE, with an underpin  based on average RoTE over  the performance period (RoTE  excluding material items in  each case)1 | 30% | 6% of award vests for 2026 RoTE of 10.0%, rising  on a straight-line basis | 30% of award vests for 2026 RoTE of 14.0% or  higher |
| This element is also subject to an underpinning requirement that average RoTE over the performance  period is at least 10%. If average RoTE over the period is less than 10%, the Committee will consider the  reasons why and determine what portion of this element of the LTIP award should vest, if any | |
| Average cost: income ratio  (excluding material items)1 | 10% | 0% of award vests for average cost: income ratio  of 62.5%, rising on a straight-line basis | 10% of award vests for average cost: income ratio  of 58.0% or lower |
| Maintain CET1 ratio within the  target range2 | 10% | If CET1 is below the target range during the period,  the Committee will consider what portion of this  element should vest, based on the reasons for the  CET1 shortfall  If CET1 is above the range and does not make  progress towards the range over the period, the  Committee will consider what portion of the  element should vest, based on the reasons for the  elevated levels of CET1 versus target range and  the associated impacts | 10% vests if either:  • CET1 is within the range during the period or  • CET1 is above but making progress towards the  target range |
| Relative total shareholder  return3 | 20% | 5% vests for performance at the median of the  peer group4, rising on a straight-line basis | 20% of award vests for performance at or above  the peer group4 upper quartile |
| Strategic non-financial measures  The evaluation will focus on a range of key metrics, with a detailed retrospective narrative on progress against each during the year. Performance  against the measures will be assessed by the Committee to determine the percentage of the award that may vest between 0% and 30%. The  measures are organised around four main categories and measures will likely include the following: | | | |
| Climate & sustainability | 15% | Progress to be measured against four key objectives:  Progress towards our Sustainable and Transition Financing target; reduce our financed emissions; reduce our  operational emissions; and support our communities | |
| Customers & clients | 5% | Drive world class outcomes for customers and clients:  Improve Net Promoter Scores; reduce Barclays UK customer complaints and improve resolution time;  maintain client rankings and market share within Barclays Investment Bank; and increase digital engagement | |
| Colleagues | 5% | Protect and strengthen our culture through our Purpose, Values and Mindset:  Continue to improve diversity in leadership roles; improve inclusion indicators; maintain engagement at  healthy levels; and maintain culture indicators | |
| Risk & operational excellence | 5% | Support a consistently excellent operating standard, risk management and controls:  Performance measured against two categories – Operational excellence and Risk & conduct – using a  combination of quantitative and qualitative metrics | |

Notes

1 Material items are defined as those large atypical one-offs that are called out in the financial reporting. The exclusion is not automatic, and the Committee will determine whether each

item should be treated as material for these purposes at the time that outcomes are determined.

2 Currently 13-14%.

3 Performance assessed over the period from 1 January 2024 to 31 December 2026. Start and end total shareholder return will be the Q4 average for 2023 and 2026 respectively and will

be measured in  GBP for each company.

4 The peer group is comprised of banks in the UK, Europe and North America of comparable size to Barclays and whose weekly returns have a high degree of correlation with  Barclays.

The peer group for the 2024-2026 LTIP award is Banco Santander, Bank of America, BBVA, BNP Paribas, Citigroup, Credit Agricole,  Deutsche Bank, HSBC, ING Group, Lloyds Banking

Group, Morgan Stanley, NatWest Group, Societe Generale, Standard Chartered, UBS, and Unicredit.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 220 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

#### Additional remuneration disclosures

Group performance graph and Group Chief Executive remuneration

The performance graph below compares the total shareholder return of Barclays shares with the total shareholder return of the FTSE

100 index over the 10 years ended 31 December 2023. The FTSE 100 index has been selected because it represents a cross-section of

leading UK companies, of which Barclays is a long-standing constituent.

Total shareholder return – rebased to 100 in 2013

Year ended 31 December

![511]()

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Year |  | 2014 |  | 2015 | | |  | 2016 | 2017 | 2018 | 2019 | 2020 |  | 2021 | |  | 2022 | 2023 |
| Group Chief Executive |  | Antony  Jenkins |  | Antony  Jenkins | John  McFarlane | Jes  Staley |  | Jes  Staley1 | Jes  Staley1 | Jes  Staley1 | Jes  Staley1 | Jes  Staley1 |  | Jes  Staley2 | C.S.  Venkata-  krishnan3 |  | C.S.  Venkata-  krishnan | C.S.  Venkata-  krishnan |
| Single total remuneration  figure for Group Chief  Executive |  | 5,467 |  | 3,399 | 305 | 277 |  | 4,233 | 3,873 | 3,362 | 5,929 | 4,220 |  | 2,121 | 866 |  | 5,197 | 4,641 |
| Annual bonus award as  a % of maximum |  | 57.0% |  | 48.0% | n/a | n/a |  | 60.0% | 48.5% | 48.3% | 75.0% | 38.6% |  | n/a2 | 92.6% |  | 75.4% | 53.3% |
| Long-term incentive plan  vesting as a % of  maximum |  | 30.0% |  | 39.0% | n/a4 | n/a4 |  | n/a4 | n/a4 | n/a4 | 48.5% | 23.0% |  | n/a2 | n/a4 |  | n/a4 | n/a4 |

Notes:

1 Jes Staley's remuneration figures for performance years 2016 to 2020 reflect the single total figures of remuneration as disclosed at the time. These have not been restated for the

decision made by the Committee during 2023 that Jes Staley's unvested bonus and LTIP awards should be forfeited, as outlined earlier in this Remuneration report.

2 Jes Staley stepped down as Group Chief Executive on 31 October 2021. The remuneration shown for 2021 is in respect of his services as an Executive Director between 1January 2021

and 31 October 2021.  This figure does not include variable remuneration as the Committee determined that Jes Staley should be ineligible for 2021 bonus and should forfeit his

unvested LTIP awards.

3 The 2021 remuneration shown is in respect of C.S. Venkatakrishnan's services during 2021 following his appointment as Group Chief Executive on 1 November 2021.

4 Not applicable as the individual was not a participant in a long-term incentive cycle that vested in the period.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 221 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

Group Chief Executive pay ratios

The table below shows, for each year since 2019, the ratios of the Group Chief Executive’s total remuneration to the total remuneration

of UK employees. The change in these pay ratios for 2023 is explained below the table.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | Option | 25th percentile | Median | 75th percentile |
| 2023 | A | 122 x | 83 x | 49 x |
| 2022 | A | 154 x | 101 x | 58 x |
| 2021 1 | A | 95 x | 62 x | 35 x |
| 2020 2 | A | 144 x | 95 x | 53 x |
| 2019 2 | A | 213 x | 140 x | 77 x |

Notes:

1 2021 pay ratios reflect the sum of the 2021 single total figures for remuneration for C.S. Venkatakrishnan and Jes Staley, for their respective periods of service as Group Chief Executive

in 2021. Jes Staley was ineligible for an annual bonus in respect of 2021 after he stepped down as Group Chief Executive.

2 The 2020 and 2019 ratios reflect the disclosed 2020 and 2019 single total figures for remuneration for Jes Staley and have not been restated for the decision made by the Committee in

2023 that Jes Staley's unvested bonus and LTIP awards should be forfeited, as outlined earlier in the report.

The Directors' Remuneration Report regulations provide three options that companies may use to calculate total pay for the

employees at the 25th percentile, median and 75th percentile. Option A was selected as this is the most robust methodology,

calculating total pay for all employees on the same basis that the single total figure for remuneration is calculated for Executive

Directors. Total pay for each employee includes earned fixed pay, which is made up of salary, any role-based pay and relevant

allowances, annual incentives awarded for the 2023 calendar year, and an estimate of pension and benefits for 2023 (based on what

new UK hires at each corporate grade currently receive). Other elements of pay such as overtime and shift allowances have been

excluded. Calculations use full-time equivalent pay data taken from our HR systems for all UK employees, for each year using the

employee population on 31 December 2023.

Total pay and fixed pay for the UK employees at the 25th percentile, median and 75th percentile are set out in the table below.

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  | 25th percentile | |  | Median | |  | 75th percentile | |
|  | Total pay | Fixed pay |  | Total pay | Fixed pay |  | Total pay | Fixed pay |
| 2023 | £38,194 | £31,897 |  | £55,801 | £45,230 |  | £95,341 | £75,583 |
| 2022 | £33,711 | £28,300 |  | £51,493 | £41,608 |  | £89,911 | £71,071 |
| 2021 | £31,404 | £26,035 |  | £48,253 | £39,461 |  | £85,407 | £67,408 |
| 2020 | £29,380 | £24,706 |  | £44,631 | £37,460 |  | £79,324 | £64,272 |
| 2019 | £27,875 | £23,348 |  | £42,362 | £35,158 |  | £77,488 | £62,263 |

The Group Chief Executive pay ratios for 2023 are lower than those for 2022, primarily driven by the lower 2023 annual bonus for

C.S. Venkatakrishnan as outlined in the 2023 annual bonus outcomes section of this Remuneration report. Higher-than-normal

employee salary increases in early 2023 as part of that year’s UK pay deal, which were weighted towards more-junior employees, also

contributed to the lower pay ratios for 2023.

Barclays' remuneration philosophy is set out earlier in this report, and all remuneration decisions for the Executive Directors and the

wider workforce are made within this framework. The Group Chief Executive pay ratios are the outcomes of all of these decisions, which

are explained in more detail in the Committee Chair’s annual statement. To ensure Executive Director remuneration outcomes are

commensurate with those of the wider workforce, each year, when considering whether a discretionary adjustment should be made to

the Executive Directors’ incentive outcomes, the Committee specifically considers whether the bonus and LTIP outcomes for the

Executive Directors appropriately reflect the Group’s performance and the remuneration outcomes for the wider workforce.

It should be noted that the ratios for 2024 are expected to increase, all other things being equal, as it will be the first year in which

C.S. Venkatakrishnan is a participant in the LTIP cycle due to vest and be included in the single total figure for remuneration.

C.S. Venkatakrishnan’s single total remuneration figure for 2023 does not include any LTIP value as he was not an Executive Director at

the time of the relevant LTIP grant3.

Note:

3 The LTIP that would be included in the 2023 single total figure for remuneration is the 2021-2023 LTIP cycle, under which awards were granted in March 2021, with vesting based on

performance over the performance period 2021 to 2023.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 222 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

Annual percentage change in remuneration of Directors and employees

The table below shows the percentage change in the Executive Directors’ Fixed Pay, benefits and bonus each year between 2019 and

2023, compared with the percentage change in each of those components of pay for UK-based employees of Barclays Group and for

employees of Barclays PLC, the Group’s parent company.

For the Executive Directors, year-on-year percentage change figures are calculated using the single total figures for remuneration,

annualised to a full-year equivalent where the individual served as an Executive Director for only part of the year.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  | Fixed pay | Benefits | Annual bonus |
| 2022/2023 | C.S. Venkatakrishnan1 | 3% | (38%) | (27%) |
| Anna Cross2 | 4% | 17% | (25%) |
| Median UK employee | 9% | 11% | (5%) |
| Median employee of Barclays PLC3 | 1% | 10% | (43%) |
| 2021/2022 | C.S. Venkatakrishnan1 | 2% | 853% | (16%) |
| Anna Cross2 | n/a | n/a | n/a |
| Tushar Morzaria | 2% | 82% | (20%) |
| Median UK employee | 5% | 10% | 3% |
| Median employee of Barclays PLC3 | 10% | 15% | (2%) |
| 2020/2021 | C.S. Venkatakrishnan1 | n/a | n/a | n/a |
| Tushar Morzaria | 2% | (10%) | 152% |
| Jes Staley4 | 1% | (12%) | n/a |
| Median UK employee | 5% | 6% | 42% |
| Median employee of Barclays PLC3 | 11% | 0% | 38% |
| 2019/2020 | Tushar Morzaria | 0% | 9% | (49%) |
| Jes Staley4 | 0% | 10% | (49%) |
| Median UK employee | 7% | 20% | (16%) |
| Median employee of Barclays PLC3 | 7% | 26% | (16%) |

Notes:

1 C.S. Venkatakrishnan was appointed as Group Chief Executive with effect from 1 November 2021. His remuneration figures for 2021 are annualised to a full-year equivalent for the

purpose of this comparison. The value of his benefits includes the cost to the Group of providing him with relocation support, including immigration assistance, home search support in

London, and payments (which ended on 31 October 2023) for temporary accommodation in London. No percentage change figures can be calculated for 2020/21 as he did not receive

any remuneration in respect of services provided as an Executive Director in 2020.

2 Anna Cross was appointed as Group Finance Director with effect from 23 April 2022. Her remuneration figures for 2022 are annualised to a full-year equivalent for the purpose of this

comparison. No percentage change figures can be calculated for 2021/22 as she did not receive any remuneration in respect of services provided as an Executive Director in 2021.

3 The Barclays PLC comparison is included because this is a statutory requirement, though Barclays PLC employs only a very small number of Head Office employees (51 in 2023).

4 Jes Staley's bonus figures reflect the disclosed figures and have not been restated for the decision made by the Committee in 2023 that Jes Staley should be ineligible for 2021 bonus

and should forfeit his unvested bonus awards, as outlined earlier in this Remuneration report.

For C.S. Venkatakrishnan and Anna Cross, the 2022 to 2023 Fixed Pay changes reflect the 3.4% and 4.3% increases agreed respectively

for each, effective 1 March 2023. The annual bonus outcome for C.S. Venkatakrishnan is down 27% and the outcome for Anna Cross is

down 25% (on a full-time equivalent basis) – the 2023 annual bonus outcomes section of this Remuneration report provides more

information. The reduction in the value of benefits for C.S. Venkatakrishnan in 2023 primarily reflects his temporary accommodation in

London ending during the year and some relocation-related benefits costs in 2022 that were not repeated in 2023.

For UK employees across the Group, the 9% increase in median fixed pay primarily reflects higher-than-normal salary increases in early

2023 as part of that year's UK pay deal. The 5% decrease in median bonus in respect of 2023 performance reflects the change in pay

structure during 2023 to simplify pay for junior employees in Barclays UK and support functions in the UK. For some employees, a

portion of previous bonus opportunity was transferred into fixed pay – leading to lower 2023 bonus outcomes for those employees.

The 11% increase in benefits is largely due to increased life assurance and private medical insurance costs.

Barclays PLC only employs a very small number of Head Office employees (51 in 2023), and there is frequent movement of employees

between Barclays PLC and other entities within the Barclays Group. For comparison purposes the Barclays PLC figures are therefore

based only on the 40 individuals who were employed by Barclays PLC in both years.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 223 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

The table below shows the percentage change in fee each year between 2019 and 2023 for the Chairman and the Non-Executive

Directors serving on the Barclays PLC Board during 2023, including fees for Board Committee memberships and/or subsidiary board

positions. The changes in fees shown relate to changes in responsibilities of the Non-Executive Directors. The Non-Executive

Directors appointed to the Barclays PLC Board during 2023 are not shown, as they did not receive relevant fees prior to 2023 so no

percentage change figures can be calculated.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | 2022/2023 fees1,2 | 2021/2022 fees1 | 2020/2021 fees1 | 2019/2020 fees1 |
| Nigel Higgins | 5% | 0% | 0% | 0% |
| Mike Ashley | 1% | (2%) | 0% | 19% |
| Robert Berry | 9% | n/a | n/a | n/a |
| Tim Breedon | 1% | (19%) | 64% | 24% |
| Mohamed A. El-Erian3 | 12% | 3% | 11% | n/a |
| Dawn Fitzpatrick4 | 11% | 18% | 14% | 36% |
| Mary Francis5 | 24% | 5% | 8% | (3%) |
| Crawford Gillies | 5% | (2%) | 108% | 4% |
| Brian Gilvary | 2% | 3% | 95% | n/a |
| Diane Schueneman6 | 12% | 4% | (4%) | 3% |
| Julia Wilson7 | 107% | 13% | n/a | n/a |

Notes:

1 In the year that a Non-Executive Director was appointed to or stepped down from the Barclays PLC Board, fees for that year are annualised to a full-year equivalent. Additional

information has been provided in the notes that follow where 2022/2023 percentage changes in fees, which excludes benefits, were greater than 10%.

2 Fees for the Group Chairman and Non-Executive Director roles on the Board and Board Committees of Barclays PLC were increased by 5%, with effect from 1 January 2023. This

excluded the Board Sustainability Committee, which was established on 23 March 2023.

3 Mohamed A. El-Erian joined the Board Nominations Committee with effect from 1 September 2022 and received pro-rata fees for that year. For 2023, the full-year fees were paid,

therefore increasing the fees paid from 2022 to 2023.

4 Dawn Fitzpatrick joined the Board Sustainability Committee with effect from 23 March 2023 and received pro-rata fees for that year, therefore increasing the fees paid from 2022 to

2023.

5 Mary Francis was appointed the BBPLC Consumer Duty Champion with effect from 10 November 2022 and received pro-rata fees for that year. For 2023, full-year fees for that role

were paid. She  also joined the Board Sustainability Committee with effect from 23 March 2023 and received pro-rata fees for that year, therefore increasing the fees paid from 2022 to

2023.

6 The increase in fees paid from 2022 to 2023 for Diane Schueneman was primarily driven by an increase in fees for her role as Chair of Barclays Execution Services Limited and as a Non-

Executive Director of Barclays US LLC.

7 Julia Wilson joined the Board Nominations Committee and Board Risk Committee with effect from 1 September 2022 and received pro-rata fees for that year. For 2023, the full-year

fees for that role were paid. She also joined the Board Sustainability Committee with effect from 23 March 2023, the Barclays Bank PLC Board with effect from 1 April 2023, and the

Board Remuneration Committee with effect from 1 July 2023. She was appointed Chair of the Board Audit Committee with effect from 1 April 2023 and Chair of the Barclays Capital

Securities Limited Board with effect from 24 April 2023, and received pro-rata fees for that year – therefore increasing the fees paid from 2022 to 2023.

Relative importance of spend on pay

A year-on-year comparison of Group compensation costs and of distributions to shareholders is shown below. The distributions shown

relate to dividends paid and share buyback programmes completed during the year. The distributions for 2023 do not include the

dividends and share buyback programme announced on 20 February 2024.

Group compensation costs

£m

|  |
| --- |
|  |
| 2023 |
| 2022 |

![15269]()

|  |  |
| --- | --- |
|  |  |
| n | Other compensation-related income statement charges8 |
| n | Income statement charge for performance costs |

Distributions to shareholders9

£m

|  |
| --- |
|  |
| 2023 |
| 2022 |

![15306]()

|  |  |
| --- | --- |
|  |  |
| n | Share buybacks |
| n | Dividends |

Notes:

8 Relates to costs arising from salaries and other elements of fixed pay, social security costs, post-retirement benefits and other compensation costs.

9 The chart shows dividends paid and share buyback programmes completed during the year. For example, for 2023, the figure represents the 2022 full-year dividend paid, the share

buyback programme announced with the 2022 results, the 2023 half-year dividend, and the share buyback programme announced with the half-year results. The shareholder

distributions announced on 20 February 2024 are not reflected in this chart.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 224 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

#### Chairman and Non-Executive Directors

Remuneration for Non-Executive Directors reflects their responsibilities and time commitment, and the fees paid are comparable with

those paid in Barclays' international peer group, with a particular focus on the UK banks. Fees shown reflect actual fees paid for periods

of service on the Board, any Board Committees and, where applicable, subsidiary Boards and Board Committees.

Non-Executive Directors are reimbursed expenses that are incurred for business reasons. Any tax that arises on these reimbursed

expenses is paid by Barclays.

Chairman and Non-Executive Directors: Single total figure for 2023 remuneration (audited)

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  |  | Fees |  |  | Benefits |  |  | Total |
|  | 2023 | 2022 |  | 2023 | 2022 |  | 2023 | 2022 |
|  | £000 | £000 |  | £000 | £000 |  | £000 | £000 |
| Chairman |  |  |  |  |  |  |  |  |
| Nigel Higgins1 | 840 | 800 |  | 8 | 7 |  | 848 | 807 |
| Non-Executive Directors |  |  |  |  |  |  |  |  |
| Mike Ashley2 | 85 | 260 |  | — | — |  | 85 | 260 |
| Robert Berry | 273 | 213 |  | — | — |  | 273 | 213 |
| Tim Breedon | 396 | 392 |  | — | — |  | 396 | 392 |
| Mohamed A. El-Erian | 173 | 155 |  | — | — |  | 173 | 155 |
| Dawn Fitzpatrick | 221 | 200 |  | — | — |  | 221 | 200 |
| Mary Francis3 | 210 | 173 |  | — | — |  | 210 | 170 |
| Crawford Gillies4 | 214 | 490 |  | — | — |  | 214 | 490 |
| Brian Gilvary | 246 | 241 |  | — | — |  | 246 | 241 |
| Sir John Kingman5 | 334 | — |  | — | — |  | 334 | — |
| Marc Moses6 | 178 | — |  | — | — |  | 178 | — |
| Diane Schueneman | 433 | 388 |  | — | — |  | 433 | 388 |
| Julia Wilson | 279 | 135 |  | — | — |  | 279 | 135 |

Notes:

1 Nigel Higgins does not receive a fee in respect of his role as Chairman of Barclays Bank PLC.

2 Mike Ashley stepped down from the Board with effect from 3 May 2023.

3 Mary Francis was appointed the BBPLC Consumer Duty Champion with effect from 10 November 2022 and received pro-rata fees for that year as a retrospective payment in 2023. The

2022 fees have been updated to reflect that payment, which is therefore not included in the 2023 fees.

4 Crawford Gillies stepped down from the Board with effect from 31 May 2023.

5 Sir John Kingman was appointed to the Board with effect from 1 June 2023.

6 Marc Moses was appointed to the Board with effect from 23 January 2023.

Chairman and Non-Executive Directors: Statement of implementation of remuneration policy in 2024

The fees for the Chairman and Non-Executive Directors (including Board and Board Committee roles) were reviewed in early 2024 and

increased by 2% with effect from 1 January 2024, as set out in the table below.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 1 January 2024 | 1 January 2023 |
|  | £ | £ |
| Chairman7 | 856,800 | 840,000 |
| Board member | 96,400 | 94,500 |
| Additional responsibilities |  |  |
| Senior Independent Director | 38,600 | 37,800 |
| Chair of Board Audit or Risk Committee | 85,700 | 84,000 |
| Chair of the Board Remuneration Committee | 75,000 | 73,500 |
| Membership of Board Audit, Remuneration or Risk Committee | 32,100 | 31,500 |
| Membership of Board Nominations Committee | 16,100 | 15,750 |
| Membership of Board Sustainability Committee8 | 15,300 | 15,000 |

Notes:

7 The Chairman does not receive any fees in addition to the Chairman fees shown above.

8 The Board Sustainability Committee was established on 23 March 2023 and the 2023 fees in respect of membership of this Committee commenced from that date.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 225 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

#### Directors

#### ’ shareholdings and share interests

Interests in Barclays PLC shares (audited)

The table below shows the number of shares owned beneficially by each person who served as a Director during 2023 (including any

shares owned beneficially by their connected persons). For the Executive Directors, it shows the number of shares over which each

holds awards that are subject to either deferral terms or to deferral terms plus performance measures, and the number of shares

owned outright includes shares purchased by the Director as well as shares received in relation to remuneration. All Barclays

employees, including the Executive Directors, are prohibited from investment activities that may create conflicts of interest, and in

particular from using personal hedging strategies to undermine the risk alignment effects embedded in remuneration, or any other

hedging in respect of Barclays securities. The numbers shown for shares that are subject to performance measures represent the

maximum number of shares that may be released if those performance measures were to be satisfied in full.

The total share interests at 16 February 2024 were the same as shown below for all Directors in service as at 31 December 2023.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Interests in Barclays PLC shares as at 31 December  (or date of retirement from the Board, if earlier) | Owned outright | Unvested deferred awards | | Total |
| Subject to  performance  measures | Not subject to  performance  measures |
| Executive Directors |  |  |  |  |
| C.S. Venkatakrishnan | 2,943,614 | 5,972,199 | 3,326,049 | 12,241,862 |
| Anna Cross | 878,859 | 1,750,247 | 1,139,575 | 3,768,681 |
| Chairman |  |  |  |  |
| Nigel Higgins | 1,852,564 | — | — | 1,852,564 |
| Non-Executive Directors |  |  |  |  |
| Mike Ashley1 | 388,187 | — | — | 388,187 |
| Robert Berry | 15,138 | — | — | 15,138 |
| Tim Breedon | 217,374 | — | — | 217,374 |
| Mohamed A. El-Erian | 153,289 | — | — | 153,289 |
| Dawn Fitzpatrick | 957,323 | — | — | 957,323 |
| Mary Francis | 81,889 | — | — | 81,889 |
| Crawford Gillies2 | 226,332 | — | — | 226,332 |
| Brian Gilvary | 257,482 | — | — | 257,482 |
| Sir John Kingman3 | 1,798 | — | — | 1,798 |
| Marc Moses4 | 5,454 | — | — | 5,454 |
| Diane Schueneman | 126,557 | — | — | 126,557 |
| Julia Wilson | 31,628 | — | — | 31,628 |

Notes:

1 Mike Ashley stepped down from the Board with effect from 3 May 2023 and as a result his shareholdings are shown as at that date.

2 Crawford Gillies stepped down from the Board with effect from 31 May 2023 and as a result his shareholdings are shown as at that date.

3 Sir John Kingman was appointed to the Board with effect from 1 June 2023.

4 Marc Moses was appointed to the Board with effect from 23 January 2023.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 226 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

Executive Directors’ shareholdings and share interests (audited)

The charts below show the value of Barclays shares held as at 31 December 2023 by C.S. Venkatakrishnan and Anna Cross, in each case

using the Q4 2023 average Barclays ordinary share price of £1.4374.

For C.S. Venkatakrishnan, the shareholding requirement is 233% of year-end Fixed Pay and for Anna Cross it is 224% of year-end Fixed

Pay. C.S. Venkatakrishnan and Anna Cross have five years from their respective dates of appointment as Executive Directors to meet

this requirement. Barclays shares held beneficially by each Executive Director count towards the shareholding requirement, as well as

unvested shares that are not subject to performance conditions (net of estimated tax and social security).

Unvested shares that are still subject to performance conditions do not count towards the shareholding requirements, but contribute

to aligning the Executive Directors' interests with those of shareholders through share price exposure – and are therefore shown below

after deduction of estimated income tax and social security withholding. For the unvested shares subject to performance conditions,

the proportion that is ultimately released may range from 0% to 100% depending on the achievement of the performance measures

for each award, and on continued employment in accordance with the relevant plan rules and the Directors' Remuneration Policy.

Executive Directors are issued a shareholding statement twice yearly, informing them of the shareholding requirement and the level of

shareholding they are required to meet and maintain. After an Executive Director has stepped down, the shareholding requirement is

monitored and maintained through self-certification, to the extent it is not met via shares held within the Group’s employee share plans

and nominee accounts.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| C.S. Venkatakrishnan |  | Anna Cross |
| £000 |  | £000 |

![63221918638437]()

![63221918638439]()

![63221918638457]()

![63221918638459]()

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Based on 31 December 2023 Fixed Pay of £2,875k.  C.S. Venkatakrishnan has until 31 October 2026  to meet this  shareholding requirement, five years from the date of his  appointment as Group Chief Executive. |  | Based on 31 December 2023 Fixed Pay of £1,800k.  Anna Cross has until 22 April 2027 to meet this shareholding  requirement, five years from the date of her appointment as  Group Finance Director. |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| n | Actual shareholdings (including estimated after-tax value of unvested shares  not subject to performance conditions) | n | Unvested shares subject to performance conditions (which do not count  towards the requirement) | n | Shareholding  requirement |

#### Payments to former Directors (audited)

Former Group Finance Director: Tushar Morzaria

As disclosed in the 2022 Remuneration report, Tushar Morzaria was provided with UK and US tax compliance services during 2023 in

respect of Barclays employment income.

Former Group Chief Executive: Jes Staley

As disclosed in the 2022 Remuneration report, Jes Staley was provided with UK and US tax compliance services during 2023 in respect

of Barclays employment income. As he is receiving no further Barclays employment income, these services ended in 2023.

Former Group Finance Director: Chris Lucas

In 2023, Chris Lucas continued to be eligible to receive life assurance cover, private medical cover and payments under the Executive

Income Protection Plan (EIPP). Full details of his eligibility under the EIPP were disclosed in the 2013 Remuneration report (page 115 of

the 2013 Annual Report). He did not receive any other payment or benefit in 2023.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 227 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| Actual |
| Requirement |

|  |
| --- |
|  |
| Actual |
| Requirement |

#### Previous AGM voting outcomes

The table below shows the shareholder voting result in respect of our 2022 Remuneration report  and Directors’ Remuneration Policy

(approved by shareholders at the AGM held on 3 May 2023).

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | For (% of votes cast and total  number) | Against (% of votes cast and  total number) | Withheld (total number) |
| Vote on the 2022 Remuneration report at the 2023 AGM | 87.76% | 12.24% |  |
|  | 8,531,247,575 | 1,189,880,467 | 19,393,115 |
| Vote on the Directors’ Remuneration Policy at the 2023 AGM | 96.69% | 3.31% |  |
|  | 9,402,353,401 | 322,148,965 | 16,010,604 |

#### Barclays Board Remuneration Committee

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Committee responsibilities  The Board Remuneration Committee is responsible for overseeing Barclays’ remuneration. The role of the Committee, as set out in  the Terms of Reference, is to:  • Set the overarching principles and parameters of remuneration policy across the Group  • Consider and approve the remuneration arrangements of (i) the Group Chair, (ii) the Executive Directors, (iii) members of the  Barclays Group Executive Committee and any other senior executives specified by the Committee from time to time, and (iv) all  other Group employees whose total annual compensation is equal to or exceeds an amount determined by the Committee  from time to time  • Exercise oversight of remuneration issues (including retirement benefits). |  |
|  |  |  |

Advisers to the Committee

The Committee appointed PricewaterhouseCoopers (PwC) as its independent adviser in October 2017. The Committee considered

the advice provided by PwC to the Committee during the year and was satisfied that the advice is independent and objective. PwC is a

signatory to the voluntary code of conduct in relation to executive remuneration consulting in the UK. PwC was paid £142,000

(excluding VAT) in fees for its advice to the Committee in 2023 relating to the remuneration of the Directors (either exclusively or along

with other employees within the Committee’s Terms of Reference). In addition to advising the Committee, PwC provided unrelated

consulting advice to the Group in respect of strategic advice on business, regulation, risk and controls, operational models and cost,

taxation, technology, pensions, HR and sustainability issues.

Throughout 2023, Willis Towers Watson (WTW) provided the Committee with market data on compensation, as context when

considering incentive levels and remuneration packages. WTW was paid £78,500 (excluding VAT) in fees for these services. In addition

to the services provided to the Committee, WTW also provides market data on compensation for other roles below Board level,

pensions and benefits advice and brokerage services to the Barclays Group, and administration services to a number of the Group's

pension funds.

In the course of its deliberations, the Committee also considered the views of the Group Chairman, the Group Chief Executive, the

Group Human Resources Director and the Group Reward and Performance Director. The Group Finance Director and the Group Chief

Risk Officer provided regular updates on Group and business financial performance and risk profiles respectively. The Head of

Corporate Communications attended when requested, to advise on reward communications and disclosures. The Group General,

Counsel or other representatives from the Legal function, and the Company Secretary advised on legal and governance-related

matters. No Barclays employee or Director participated in decisions of the Committee relating to his or her own remuneration. No

other advisers provided services to the Committee in the year.

Committee effectiveness in 2023

The results of the Committee effectiveness review for 2023 confirm the Committee is operating effectively. It is considered to be well

constituted and chaired, providing an effective and appropriate level of constructive challenge and oversight of the areas within its

remit, including in respect of areas of judgement and discretion. The review highlights that the Committee is considered to have the

right level of skills and experience, and is of an appropriate size, having benefited from the addition of new members during the year.

Feedback indicates that the Committee is considered to operate at the right level of debate, and confirms that the allocation of time

between agenda items in Committee meetings is appropriate, with sufficient time for discussion and challenge.

The Committee’s interaction with the Board, Board Committees and senior management is considered effective, noting the strong

level of support provided to the Committee by senior management, and that sufficient time is allocated at Board meetings for the Chair

to report to the Board on the work of the Committee. The Committee’s interaction with the BBPLC and BBUKPLC Board Remuneration

Committees was also considered effective, and operates in line with regulatory requirements.

|  |  |
| --- | --- |
|  |  |
| + | More information on the 2023 Committee effectiveness review  process can be found in the Board Nominations Committee report  page [164](#id6f86b9feb8d4bb290582a02d22ac8cc_240140) |
|  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 228 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| + | The Committee’s terms of reference are available at [home.barclays/](https://home.barclays/who-we-are/our-governance/board-committees/)  [who-we-are/our-governance/board-committees](https://home.barclays/who-we-are/our-governance/board-committees/) |
|  |  |

Committee activity in 2023 and early 2024

The following table summarises the Committee’s activity during 2023, and at the January and February 2024 meetings at which

remuneration decisions reported in this Remuneration report were finalised. The Committee is also provided with updates at each

scheduled meeting on: the operation of the Committee’s Remuneration Control Framework on hiring, retention and termination;

headcount and employee attrition; and extant LTIP performance.

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  |  | January  2023 | February  2023 | June  2023 | October  2023 | December  2023 | January  2024 | February  2024 |
| Overall  remuneration | Finance and Risk updates | ▪ | ▪ | ▪ | ▪ | ▪ | ▪ | ▪ |
| Incentive funding proposals including risk  and control adjustments | ▪ | ▪ |  | ▪ | ▪ | ▪ | ▪ |
| Remuneration report 2022 | ▪ | ▪ |  |  |  |  |  |
| Group budgets for fixed pay increases | ▪ | ▪ |  | ▪ | ▪ | ▪ | ▪ |
| Wider workforce considerations | ▪ | ▪ | ▪ | ▪ | ▪ | ▪ | ▪ |
| Incentive funding approach |  |  | ▪ |  |  |  |  |
| Barclays’ Fair Pay Agenda and Report | ▪ | ▪ |  | ▪ |  | ▪ | ▪ |
| Directors' Remuneration Policy | ▪ | ▪ |  |  |  |  |  |
| Remuneration report 2023 |  |  |  |  | ▪ | ▪ | ▪ |
| Executive  Directors’ and  senior  executives’  remuneration | Executive Directors’ and senior  executives’ bonus outcomes | ▪ | ▪ |  |  | ▪ | ▪ | ▪ |
| Annual bonus and LTIP performance  measures and target calibration | ▪ | ▪ |  |  | ▪ | ▪ | ▪ |
| Governance | Regulatory and stakeholder matters | ▪ | ▪ | ▪ | ▪ | ▪ | ▪ | ▪ |
| Discussion with independent adviser | ▪ | ▪ | ▪ | ▪ | ▪ | ▪ | ▪ |
| Remuneration Review Panel update |  |  | ▪ | ▪ | ▪ | ▪ |  |
| Review of Committee effectiveness |  | ▪ |  |  |  |  | ▪ |

One ad-hoc Committee meeting was called during 2023.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 229 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Remuneration report (continued) | | | | | | | | | | |

### Other Governance

This section aims to provide an overview of certain governance matters of

particular relevance to ESG ratings agencies and investors across a range of

ESG matters. It covers topics such as our Code of Conduct, Whistleblowing,

Tax, Financial crime, Health and Safety and how we manage our Data privacy

and Security as well as Resilience. This section also includes our approach to

managing social and environmental impacts as well as our Governance

disclosures as part of the TCFD recommendations.

This section does not discuss general corporate governance

matters. Refer to the Board Governance report from page [144](#i4be61753b7f243b19551b0bfbf3a2a0d_448) in

the Annual Report for information relating to the Board, ExCo and

Board Committees, our Board governance framework and how

we complied with the requirements of the 2018 UK Corporate

Governance Code during 2023.

|  |  |
| --- | --- |
|  |  |
| [Climate and sustainability governance](#i4be61753b7f243b19551b0bfbf3a2a0d_553) | [231](#i4be61753b7f243b19551b0bfbf3a2a0d_553) |
| Managing impacts in lending and financing | [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559) |
| Our supply chain | [238](#i4be61753b7f243b19551b0bfbf3a2a0d_172) |
| Human rights / Modern slavery | [239](#i4be61753b7f243b19551b0bfbf3a2a0d_9166) |
| Supporting our customers | [242](#i4be61753b7f243b19551b0bfbf3a2a0d_124) |
| The Barclays Way | [245](#i4be61753b7f243b19551b0bfbf3a2a0d_12486) |
| Whistleblowing | [246](#i4be61753b7f243b19551b0bfbf3a2a0d_565) |
| Tax | [247](#i4be61753b7f243b19551b0bfbf3a2a0d_568) |
| Financial crime | [249](#i4be61753b7f243b19551b0bfbf3a2a0d_571) |
| Health and safety | [250](#i4be61753b7f243b19551b0bfbf3a2a0d_574) |
| Managing data privacy, security and resilience | [251](#i4be61753b7f243b19551b0bfbf3a2a0d_577) |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 230 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  | | | | | | | | | | |

#### Climate and sustainability governance

Oversight and management of climate-related issues are embedded within our governance structure.

Barclays’ governance structure consists of the Barclays PLC Board (Board) and its Committees along with Executive and Management

Committees which span across both business and legal entity lines. The Board sets the Group’s climate-related strategy and oversees

its implementation by senior management.

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Governance structure | | | | | | | | | | | | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Barclays PLC Board | | | | | | | | | | | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Group Executive Committee (Group ExCo) | | | | | | | | | | | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Business / Legal Entity Functions / Committees & Forums | | | | | | | | | | | | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Group  Chief  Compliance  Officer |  | Group  Chief Operating  Officer |  | Group  Chief Risk  Officer |  | Group  Head of  PPCR |  | CEOs -  Corporate  & Investment  Bank and  Barclays UK |  | Group  Finance  Director |  | BX Risk and  Finance Chief  Operating  Officer |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Group  Sustainability  Chief  Information  Officer |  | Group  Head of  Climate Risk |  | Group  Head of  Sustainability |  | Group Head  of Sustainable  Finance -  Corporate &  Investment  Bank |  | Head of Social  Purpose and  sustainable  Finance -  Barclays UK |  | Group Head of  Finance -  Sustainability  and ESG |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

Note

1 The presentation of senior management is not directly aligned to the committees / forums upon which they reflect.

Climate and Sustainability Governance changes during 2023

During 2023 a number of changes were made to the governance of Climate and Sustainability related matters. In particular the Board

Sustainability Committee and the Group Sustainability Committee (GSC) were established to provide oversight of climate matters and

the Group's sustainability agenda. The GSC has incorporated the work of the Climate and Sustainable Finance Council and oversees the

activity of the Financed Emissions Programme, one of the three pillars of our Climate Strategy. Further details on these Committees

can be found below. For transaction-related oversight and approval, the Transaction Review Committee has absorbed the

responsibilities of the Climate Transaction Review Committee and reflects the business-as-usual approach to reviewing transactions.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 231 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance | | | | | | | | | | |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Board Sustainability  Committee |  | Board Risk Committee |  | Board Audit  Committee |  | Board Remuneration  Committee |

![p254_Climate and Sustainability-related Governance2.png]()

![p254_Climate and Sustainability-related Governance3.png]()

![p254_Climate and Sustainability-related Governance4.png]()

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Operational Sustainability  Steering Committee |  | BBplc Transaction  Review Committee |  | Principal Investments  Equity Committee |  | Financed Emissions  Programme |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Group Reputation Risk  Committee |  | Group Risk  Committee |  | Group Sustainability  Committee |  | Disclosure  Committee |
|  |  |  |  |  |  |  |
|  |  | Climate Risk  Committee |  |  |  |  |

![Senior Management1.png]()

Roles and responsibilities of the Board and Board Committees with respect to climate-related matters

|  |  |
| --- | --- |
|  |  |
| Board / Board Committee | Roles and responsibilities |
| Board | Responsible for the overall leadership of the Group (with direct oversight of matters relating to strategy,  reputation and culture). The Board sets the Group’s strategy, including in respect of climate. |
| Board Sustainability  Committee | Responsible for oversight of climate matters and the Group’s sustainability agenda, and supports the  Board in considering the suitability of the Group’s climate and sustainability strategy, position  statements, frameworks, ambitions, metrics, and targets and monitoring the implementation of the  Group’s climate and sustainability strategy. |
| Board Risk  Committee | Responsible for monitoring Principal Risks (including Climate risk), considering the Group’s risk appetite  and tolerances, along with reviewing the Group’s risk profile and commissioning, receiving and  considering reports on key risk issues. |
| Board Audit  Committee | Responsible for overseeing the integrity of the Group's financial disclosures, the effectiveness of the internal  control environment and consideration of non-financial reporting. This Committee oversees financial and  narrative reporting which encompasses ESG and climate disclosures within the Annual Report. |
| Board Remuneration  Committee | Responsible for setting the overarching principles and parameters of remuneration policy across the  Group. This Committee has responsibility for aligning Executive Director remuneration with strategic  priorities, including in relation to climate and sustainability matters. |

Board and Board Committee

oversight of climate-related risks

and opportunities

Barclays PLC Board

The Board and, as appropriate, its

Committees are responsible for the

oversight of climate and sustainability

matters, including climate-related risks

and opportunities.

During 2023, the Board received six

climate-related updates. These covered

matters such as progress against our

climate strategy, progress against targets

and target setting, and stakeholder

engagement. Outside of formal Board

briefings, the Group Head of Public Policy

and Corporate Responsibility also engaged

with Board members on matters relating

to the Group’s climate strategy. Please see

the Key Board activities section on page

[153](#i4be61753b7f243b19551b0bfbf3a2a0d_7146825599531) for further detail about what the Board

considered in relation to climate and

sustainability matters in 2023.

The Board is supported in its work by its

Committees, each of which has its own

Committee terms of reference setting out

its remit and decision-making powers. The

Chairs of each of the Board Committees

provide a report on the work of their

Committee at every scheduled Board

meeting.

Board Sustainability Committee

During 2023, the Board Sustainability

Committee met four times. It reviewed

significant climate and sustainability

updates and proposals prior to Board

consideration and received regular

progress updates from management in

relation to the Group’s climate and

sustainability strategy, as well as internal

and external briefings on climate and

sustainability matters. Please refer to page

[180](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686051773) for further detail on the work of the

Board Sustainability Committee.

Board Risk Committee

During 2023, the Board Risk Committee

received quarterly reports from the

businesses (including the Corporate and

Investment Bank and Barclays UK) on their

climate strategy and also received an

update from the Head of Climate Risk. The

Committee received a teach-in from the

Risk function, providing an overview of how

climate change was driving financial and

operational risks, the materiality of their

impact and how Barclays was managing

them through the Climate Principal Risk

Framework. The Committee also received

three Climate risk dashboards during the

year, updating the Committee with key

Climate risk metrics. Please refer to page

[174](#i4be61753b7f243b19551b0bfbf3a2a0d_487) for further detail on the work of the

Board Risk Committee.

Board Audit Committee

The Board Audit Committee provides

oversight of the climate and sustainability

disclosures within the Group's narrative

reporting, receiving input also from the

Board Sustainability Committee on those

disclosures. The Committee continues to

monitor that the impact of climate change

has been addressed in preparing the

Group’s financial statements. Please refer

to page [166](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686054584) for further detail on the work

of the Board Audit Committee.

Board Remuneration

Committee

The Board Remuneration Committee is

responsible for setting the overarching

principles and parameters of remuneration

policy across the Group. The Committee

has responsibility for aligning Executive

Director remuneration with strategic

priorities, including in relation to climate

and sustainability matters.

The performance measures for the 2024

annual bonus and 2024-2026 Long Term

Incentive Plan awards for the Executive

Directors include a 'Climate and

sustainability' category , focusing on

climate-related measures reflecting our

ambition to be a net zero bank by 2050,

including our commitment to align our

financing with the goals and timelines of

the Paris Climate Agreement. The

measures include progress towards our

Sustainable and Transition Financing

target, reducing financed emissions and

operational emissions, and supporting our

communities. Please refer to the

Remuneration report from page [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520) for

further detail on the work of the Board

Remuneration Committee.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  |  |  |  |
|  | Nature-related governance  The Board Sustainability Committee  provides formal oversight of climate  and sustainability matters, including  nature and biodiversity.  During 2023, the Board Sustainability  Committee and Group Sustainability  Committee, a sub-committee of the  Group Executive Committee, each  received a briefing on nature and  biodiversity delivered by an external  organisation. The sessions covered  nature-related policy and regulatory  developments, and work conducted by  Barclays as part of the UNEP FI pilot to  test the draft TNFD framework risk  assessment process (LEAP FI) on our  agriculture and food portfolio in the UK  and Europe. | | |  |
|  |  |  |  |  |
|  | + | You can read more about our approach to nature  and biodiversity on page [124](#i4be61753b7f243b19551b0bfbf3a2a0d_391). | | |
|  |  |  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 232 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

Management's role in assessing

and managing climate-related

risks and opportunities

Oversight and management of Barclays'

climate strategy is increasingly embedded

in business-as-usual management

structures, including a number of

executive committees. These committees

are mandated and form part of Barclays’

formal governance architecture. They are

convened to oversee a specific attribute of

the Barclays control framework. Each

committee is itself governed by Terms of

Reference that lay out the duties,

decision-making authority and escalation

route of any material issues.

The executive management committees

receive regular briefings on matters

including climate change. Both risks and

opportunities are considered by

management. Climate-related risks are

assessed and escalated as appropriate

through the various risk forums. In 2023

the Group Sustainability Committee was

established as a dedicated forum to

identify and discuss climate-related

matters across the Group with a specific

mandate to review and propose

amendments to the Group Climate

strategy prior to consideration by Group

ExCo.

Group Executive Committee

(Group ExCo)

Throughout 2023 Group ExCo has been

provided with regular updates on our

climate strategy, including progress on our

commitments, stakeholder engagement

and expectations, and target-setting.

The Group Head of PPCR is a member of

Group ExCo and is accountable for

ensuring the Group’s societal purpose is

present in strategic decision-making at the

highest levels in the organisation. The

Group Head of PPCR, and their team,

regularly updates Group ExCo on a range

of Public Policy and Corporate

Responsibility matters, covering key

government and regulatory policy,

regulator engagement and ESG matters,

including climate. In particular, the Group

Head of PPCR provided updates on the

Climate strategy including proposed

amendments to the oil and gas policy and

the establishment of new targets for

aviation, agriculture and commercial real

estate. Updates were also provided on a

range of other matters, such as

greenwashing, deforestation and

biodiversity.

The Chief Risk Officer is a member of

Group ExCo and is accountable for the

approach to managing climate-related

financial and operational risks to Barclays;

this is implemented within the Group's

Enterprise Risk Management Framework

(ERMF).

During 2023, Group ExCo established the

Group Sustainability Committee to advise

and provide recommendations on a broad

range of sustainability issues as further

described in the Climate and Sustainability

Governance section of this report. Group

ExCo was presented with updates on the

proposed policy for upstream oil & gas

financing.

Capturing the opportunity as we transition

towards a low-carbon economy was

identified as a key strategic growth pillar for

Barclays in 2022 and informed the setting

of a $1trn Sustainable and Transition

Financing target by the end of 2030. In

2023, a Group sustainable finance strategy

was developed by the new CIB Global Head

of Sustainable Finance and the BUK Head

of Social Purpose & Sustainable Finance,

setting out areas of strategic focus for the

group in delivering the $1trn target. The

strategy was presented to Group ExCo

and Group Board.

All submissions to the Barclays PLC Board

on Climate Strategy and climate-related

matters are reviewed either by Group

ExCo or the relevant Group ExCo member

in advance.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  |  |  |  |
|  | Executive Remuneration  Annual bonus outcomes and Long  Term Incentive Plan (LTIP) award  outcomes for the Executive Directors  of Barclays PLC are assessed against a  framework of measures set by the  Remuneration Committee at the start  of the performance period for each  award. A proportion of both annual  bonus and LTIP is driven by non-  financial performance measures,  including measures relating to climate  and sustainability.  The weighting of the Climate and  sustainability category is 15% in the  2024-2026 LTIP and 5% in the 2024  annual bonus. The climate-related  measures reflect our ambition to be a  net zero bank by 2050, including our  commitment to align our financing with  the goals and timelines of the Paris  Climate Agreement. The measures  include progress towards our  Sustainable and Transition Financing  target, reducing financed emissions  and operational emissions, and  supporting our communities. | | |  |
|  |  |  |  |  |
|  | + | Further details can be found in our Remuneration  report from page [191](#i4be61753b7f243b19551b0bfbf3a2a0d_520). | | |
|  |  |
|  |  |  |  |  |

Group Sustainability Committee (GSC)

The Group Sustainability Committee

(GSC), a sub-committee of Group ExCo, is

chaired by the Group Head of PPCR with

senior representation from the Group

Head of Sustainability, Head of Sustainable

Finance  for CIB and Head of Social

Purpose and Sustainable Finance for

Barclays UK, as well as members

representing key functions across the

Group.

The GSC is responsible for recommending

the overall Group sustainability strategy for

approval by Group ExCo, and ensuring

alignment of business unit climate

strategies to the overall strategy. The GSC

is also responsible for determining,

agreeing or recommending position

statements, frameworks, targets, relevant

disclosures and advocacy areas necessary

to support strategy delivery and agreeing

the strategic change priorities to support

overall sustainability strategy.

Group Risk Committee (GRC)

The GRC is the designated forum to review

and recommend, where necessary,

submissions to the BRC. The GRC is the

most senior risk executive body, and it

monitors Principal Risks and key topics

material to Barclays such as climate

change. In 2023, in relation to climate, the

GRC reviewed:

• key regulatory, global policy and

geopolitical themes and management

action proposed and taken

• physical and transition risk metrics,

including portfolio alignment progress

against net zero sector targets and

mitigation plans

• the Climate Risk Framework and Climate

Risk Appetite constraints

• scenario theme, severity and results of

the climate stress test and internal

stress test, including implications on

stress loss limits

In relation to Principal Risks, the GRC

undertakes the following:

• review and monitor the risk profile of

material nature for each Principal Risk

• approve for consideration by Barclays

PLC Board and BBPLC Board Risk

Committee the Risk Appetite

Statement for each Principal Risk

• annually review and approve the

Principal Risk Framework for

consideration by the Barclays PLC Board

and BBPLC Board Risk Committee.

The GRC receives escalations from the

Climate Risk Committee, noting none were

received in 2023

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 233 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

Climate Risk Committee (CRC)

To support the oversight of Barclays'

climate risk profile, the CRC was

established in 2021 as a sub-committee of

GRC. The authority of the CRC is

delegated by the GRC, and the Group

Head of Climate Risk is the Chair of CRC.

The CRC has reviewed and approved a

range of updates including the climate risk

appetite and plans for embedding climate

risk into business activities. Additionally,

quantitative and qualitative metrics,

emerging climate risk trends and progress

against targets are presented and

discussed at the CRC.

Disclosure Committee (DisCom)

DisCom, which is chaired by the Group

Finance Director, has been set up as a sub-

committee of the Group ExCo. DisCom is

convened to review and monitor the

integrity of the Group’s financial and

narrative statements and other

information provided to stakeholders,

whether by means of announcement or

otherwise. In addition to reporting to the

Group ExCo, DisCom also reports to the

BAC.

DisCom is convened to undertake a

number of specific duties, including:

• financial reporting: to review and

monitor the integrity of the Group’s

financial statements, interim

management statements, preliminary

announcements (if prepared), and any

other formal announcements relating to

the Group’s financial performance.

• narrative reporting: to review and

monitor the integrity of the Group’s

narrative statements, including but not

limited to the Country Snapshot, ESG

disclosures, the TCFD disclosures and

the Modern Slavery Statement.

Group Reputation Risk Committee

(GRRC)

The Group Reputation Risk Committee

(GRRC) is a sub-committee of the Group

ExCo which reviews and challenges, and

directs as appropriate, the management

and mitigation of Reputation Risk matters

in the Barclays Group as they are brought

to the attention of the Committee via

relevant Reputation Risk assessment and

escalation processes. This includes

Reputation Risk associated with climate-

related matters. The GRRC is chaired by

the Group Chief Compliance Officer, as

the Principal Risk owner for Reputation

Risk in the Bank, and members include the

Group CRO and Group Head of PPCR. In

2023 the GRRC considered certain

transactions in scope of the bank's

Sustainability Standards to evaluate their

alignment with the bank's climate change

and sustainability strategy.

Group Chief Executive Officer (Group

CEO)

The Group CEO is responsible for driving

Barclays’ focus on external societal and

environmental stewardship, and

overseeing progress towards Barclays’

ambition to be a net zero bank by 2050.

The Group CEO is Chair of Group ExCo.

The Group CEO is closely involved in

identifying, accelerating and promoting the

development of Barclays’ climate and

sustainable finance growth opportunities

as we transition towards a low-carbon

economy.

The Group CEO has been an active

member of the Sustainable Markets

Initiative's Financial Services Taskforce and

both attended and spoke at the Autumn

CEO Summit during New York Climate

Week in September 2023. In 2023, the

Group CEO co-led the Nature-based

Solutions (NbS) workstream which

published the Coastal NbS Practitioners

Guide in November 2023. The Group CEO

has also been a Leadership Council

member of the United Nations

Environment Programme Finance Initiative

(UNEP FI) since 2022 and attended the

annual council meeting in December 2023.

The Group CEO also participated in

London Climate Action week, hosting a

roundtable discussion with company CEOs

from Barclays' Sustainable Impact Capital

Portfolio.

Chief Risk Officer (CRO)

The Group CRO is accountable for the

approach to managing climate-related

financial and operational risks to Barclays.

This encompasses the measurement,

monitoring and limit setting for Climate risk

and the supporting governance.

Group Head of PPCR

The Group Head of PPCR leads the

Group’s overall sustainability and

citizenship agendas. Specifically, the role is

responsible for leading Barclays’ efforts in

tackling climate change, and for integrating

our ambition to help embed the transition

towards a low-carbon economy into the

business.

Group Head of Sustainability

The Group Head of Sustainability leads the

Sustainability and ESG team, and the

strategic direction and execution of

Barclays’ policies and practices across a

broad range of sustainability and ESG

matters, including climate change. The role

also oversees the development of

standards and metrics to advance green

and sustainable finance and support

innovation in sustainable product

development.

This role is responsible for Reputation risk

issues arising from climate change,

although the Board has overall

responsibility for reputation matters

generally. The Group Head of Sustainability

reports directly to the Group Head of

PPCR.

Group Head of Climate Risk

The Group Head of Climate Risk is the

Climate Principal Risk owner accountable

for the management and oversight of the

climate risk profile. The Group Head of

Climate Risk reports directly to the Group

CRO and is the Chair of CRC.

The Group Head of Climate Risk is

responsible for the development and

implementation of climate risk

governance, including ownership of

Barclays’ Climate Risk Framework and

Policy. The Group Head of Climate Risk is

also responsible for integrating climate risk

considerations into existing risk

management processes and overseeing

climate risk management activities,

including identifying, assessing, and

monitoring climate risk drivers and

proposing climate risk appetite, limits and

controls. The Group Head of Climate Risk

also leads the development of climate risk

methodologies and Barclays’ approach to

carbon modelling, including the

BlueTrack™ methodology.

Group Sustainability Chief Information

Officer

Created in 2023, the Group Sustainability

Chief Information Officer (CIO) brings

together technology, data  and change

execution expertise. The Group

Sustainability CIO works in partnership with

the business and functions to deliver new

capabilities that enable and accelerate

delivery against the Group's sustainability

strategy.

Group Head of Finance - Sustainability

and ESG

The Group Head of Finance - Sustainability

and ESG was appointed in January 2022.

The role encompasses leading Barclays'

global external, internal and regulatory

reporting capabilities relating to

sustainability and ESG, and tracking

progress made across our businesses to

meet our climate targets, which is

fundamental to support our ambition to be

a net zero bank by 2050. This includes

embedding climate-related disclosures

such as the TCFD into our framework of

disclosure procedures, governance and

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 234 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

controls  supporting the creation, review

and approval of the Group’s financial

statements. Further responsibilities

include embedding climate-related risks

and opportunities into financial planning.

Global Head of Sustainable Finance -

Corporate & Investment Bank

The Global Head of Sustainable Finance for

the Corporate and Investment Bank (CIB)

is a member of the CIB Management

Team, reporting to the Global Head of the

CIB and the Group Head of PPCR. The role

was created in 2022 to develop a centre of

excellence for sustainable finance to

support Barclays’ clients navigate the

opportunities and challenges of

transitioning towards a low-carbon

economy. The Group Head of Sustainable

Finance for CIB is also a member of the

Barclays Sustainable Impact Capital

portfolio Investment Committee, which

has a mandate to invest up to £500m in

global climate technology companies by

the end of 2027. The role partners closely

with Barclays’ Sustainability & ESG team on

our net zero ambition and environmental

and social risk management and with the

Head of Social Purpose and Sustainable

Finance for Barclays UK to deliver change

across the Group.

Head of Social Purpose and Sustainable

Finance - Barclays UK

The role of  Head of Social Purpose and

Sustainable Finance  for Barclays UK was

created in 2022 with responsibility for the

strategic direction and execution of the

Barclays UK sustainability strategy. The

role oversees the development and

delivery of Barclays UK products and

propositions to enable our retail and small

business customers to adopt more

sustainable practices – covering finance,

tools, education and partnerships. The role

also partners closely with the Barclays UK

Government Relations team to develop

advocacy positions, as well as Legal, Risk

and Compliance functions to embed

sustainability into processes and

frameworks.

Implementation - business

working level committees,

forums and reports

Business / Legal Entity committees /

forums

Oversight and management of climate-

related risks and opportunities occur at a

number of levels in the organisation and

across business lines and legal entities.

Barclays operates through a combination

of formal mandated committees and

governance bodies/forums. The

mandated committee structure operates

on a legal entity basis and will oversee

climate-related issues relevant to that

entity.

These are supported by Subcommittees/

other governance bodies/forums which

can operate on a legal entity basis or

across the Group and oversee climate-

related issues, risks and opportunities

within their remit and escalate material

issues as appropriate. These committees

and forums follow the established

escalation process for climate-related

items, bringing updates first to the relevant

Group ExCo member, then the Group

ExCo, and ultimately to the Board.

Operational Sustainability Steering

Committee (OSSCo)

Barclays’ Operational Sustainability

Steering Committee (OSSCo) is

responsible for the development and

implementation of the Group’s net zero

operations strategy.

OSSCo is chaired by the Barclays

Execution Services (BX) Chief Operating

Officer and comprises leadership from

Corporate Real Estate Solutions (CRES) &

Location Strategy, Barclays UK,

Procurement and Sourcing, Group

Technology Infrastructure Services (GTIS),

Corporate Communications, Group

Sustainability & ESG, and Legal. OSSCo

reviews and approves environmental

operational targets, reviews operational

sustainability programmes and mitigates

risks to the delivery of the net zero

operations strategy. OSSCo also facilitates

coordination and alignment across the

functions responsible for implementing

the net zero operations strategy.

OSSCo provides updates to the GSC every

quarter, which then reports to the Barclays

PLC Board twice a year.

BBplc Transaction Review Committee

The BBplc Transaction Review Committee

(TRC) is convened for senior management

to review all BBplc Transactions that

contain material Reputation Risk and

escalates directly to the Group Reputation

Risk Committee. The TRC has

responsibility to ensure alignment with

local entity and regulatory expectations

and requirements when making decisions

that impact the various subsidiaries of

BBplc, including Barclays Bank Ireland PLC

('Barclays Europe') and the US

Intermediate Holding Company.

Transactions reviewed include

transactions, relationships, agreements,

strategies and other business activities.

Principal Investments Equity Committee

The Principal Investments Equity

Committee (the “Committee”) undertakes

the senior approval responsibilities relating

to the execution and management of all

principal strategic equity and workout

equity transactions managed on behalf of

Barclays PLC and all other Barclays Group

entities. The formation and authority of

this Committee comes from the Group

CEO, acting through the Group ExCo. The

Committee consists of senior

stakeholders who meet on a regular basis

which, when considering the ‘Sustainable

Impact Capital’ portfolio, includes the

Global Head of Sustainable Finance and

Group Head of Sustainability for CIB.

Financed Emissions Programme

The Group change programme on climate

('the programme') is focused on driving the

execution of one of the three pillars of our

Climate Strategy, ‘Reducing our Financed

Emissions’, within which Barclays is

committed to aligning its financing with the

goals and timelines of the Paris

Agreement, consistent with scenarios

limiting the increase in global

temperatures to 1.5°C. The programme is

set up in line with the Barclays Change

Delivery Management standard, with

established governance and regular

reporting at the GSC. The overall

Accountable Executive of the programme

is the Group Head of Sustainability, also

the chair of its governance body

represented by key businesses and

functions across the Group, such as

Sustainability & ESG, Risk, Business

(Corporate and Investment Bank and

Barclays UK), Finance and Technology.

Key focus areas of the programme since

its inception include setting targets for

some of our highest emitting sectors,

establishing Climate risk as a new Principal

Risk (as part of the Enterprise Risk

Management Framework), embedding

required processes and frameworks within

the business to implement and manage

sector targets, evaluating absolute

emissions across the in-scope balance

sheet, and delivering to a technology

roadmap to meet climate data

requirements.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 235 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

#### Managing impacts in lending and financing

Appropriate management of environmental and social impacts helps to

#### ensure the longevity of our business and our ability to serve our clients.

At Barclays, we recognise the importance

of risk identification and management in

the provision of financial services to our

customers and clients.

Our assessment of environmental and

social risks informs our wholesale credit

risk management and helps safeguard our

reputation. This supports the longevity of

our business and also enhances our ability

to serve our clients and support them in

improving their own sustainability practices

and disclosures.

Managing environmental and

social risks

Environmental and social risks are

governed and managed through our

Enterprise Risk Management Framework

(ERMF), setting our strategic approach for

risk management by defining standards,

objectives and responsibilities for all areas

of Barclays. The ERMF is complemented

by a number of other frameworks, policies

and standards, all of which are aligned to

individual Principal Risks.

Our Climate Change Statement sets out

our current restrictions on business

appetite and includes restrictions in

respect of certain sensitive energy

subsectors (thermal coal mining, coal-fired

power generation, mountain-top coal

removal, upstream oil & gas and

unconventional oil & gas including oil

sands, Arctic oil & gas, hydraulic fracturing

('fracking'), Amazon oil & gas, ultra-deep

water and extra heavy oil), as well as

referencing new enhanced due diligence

requirements for biomass which will be

introduced during 2024.

We have also established positions on

Forestry and Agricultural Commodities,

World Heritage and Ramsar Wetlands and

on the Defence and Security sector. In

addition, we have developed internal

standards for each of these which reflect

these positions in more detail.

These standards, which sit under the

management of Reputation risk in the

ERMF, determine our approach to climate

change and relevant sensitive sectors and

are considered as part of our existing

transaction origination, review and

approval process.

Enhanced Due Diligence

Our standards currently include an

enhanced due diligence approach for

certain clients operating in the following

energy sub-sectors covered by our

Climate Change Statement:  thermal coal

mining, coal-fired power generation,

mountain-top coal removal, oil sands,

Arctic oil & gas  and hydraulic fracturing

('fracking')  and clients in-scope of our

Forestry and Agricultural Commodities,

World Heritage Sites and Ramsar Wetlands

and Defence and Security standards where

a similar approach is taken.  This approach

will be extended to cover the additional

sectors brought into scope of the updated

Climate Change Statement.

All clients in-scope of the above

mentioned  standards must be assessed

annually via a detailed Sustainability

enhanced due diligence questionnaire,

which is used to evaluate their

performance on a range of environmental

and social issues and may be

supplemented by a review of client

policies / procedures, further client

engagement and adverse media checks as

appropriate. This annual review either

generates an Environmental and Social

Impact (ESI) risk rating (low, medium, high),

or in the case of Defence and Security an

assessment against risk appetite, which in

turn determines whether further review

and client engagement may be required

throughout the year.

High and certain medium ESI rated clients

would require further risk assessment prior

to execution of transactions with those

clients.

We undertook 593 (2022:597) reviews in

2023, being a combination of Sustainability

annual due diligence reviews and individual

transaction reviews. Environmental risk

reviews are captured within the business-

as-usual credit process and are therefore

no longer included within this number.

Monitoring

As part of our management of

environmental and social risks, we may

require further client engagement in

relation to the specific environmental and

social risks that we have identified as part

of our enhanced due diligence process.

We have used this engagement as an

opportunity to gain a more detailed

understanding of the risks and challenges

that the client is facing and to better

understand any climate transition plan that

they may have.

Escalation and decision-making

Where client relationships or transactions

are assessed as higher-risk (high or

medium ESI rating) or outside appetite (in

the case of Defence and Security)

following a Sustainability enhanced due

diligence review, they are then considered

for escalation to the appropriate business

unit review committee (e.g. BBplc

Transaction Review Committee) for

consideration and a decision on whether to

proceed if transaction related. Business

unit review committees comprise of

Business management and

representatives from the control

functions, including Reputation risk.

Should the front office business team or

the Sustainability and ESG team believe

the issues are sufficiently material, these

clients/relationships would be escalated to

the Group Reputation Risk Committee

(GRRC) for more senior consideration and

decision.

GRRC includes representation from the

Group Executive Committee.

These Committees may make the

following determinations:

• approve the transaction or relationship

• reject the transaction or relationship

• approve the transaction or relationship,

subject to prescribed modifications

• escalate the review of the transaction or

relationship to the Barclays Group CEO.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 236 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

Training

Barclays continues to expand the range

and coverage of training to educate

colleagues on ESG and climate change

risk, its impact on society and Barclays'

strategy and response.

|  |  |
| --- | --- |
|  |  |
| + | Further details on Barclays skills, culture & training  can be found on page [122](#i4be61753b7f243b19551b0bfbf3a2a0d_385). |
|  |

|  |
| --- |
|  |
| Transactions and client relationships  reviewed by Group Sustainability |

![58823872126677]()

![58823872126635]()

|  |  |
| --- | --- |
|  |  |
| n | Agriculture |
| n | Chemicals |
| n | Commodity  Traders |
| n | Defence,  Aerospace &  Security |
| n | Infrastructure &  Transportation |
| n | Manufacturing |
| n | Metals & Mining |
| n | Oil & Gas |
| n | Paper &  Forestry |
| n | Power & Utilities |
| n | Waste |
| n | Other |
|  |  |

|  |
| --- |
|  |
| 2023 |
| Total 593 |

|  |
| --- |
|  |
| 2022 |
| Total 597 |

Equator Principles

For project-related finance, we conduct

assessments for environmental and social

risks in line with the Equator Principles and

relevant International Finance Corporation

(IFC) Performance Standards. Barclays was

one of the four banks that contributed to

developing the Principles ahead of their

launch in 2003. During 2023, 4

transactions (2022: 1 transaction) were

reviewed for social and environmental risks

under the scope of the Equator Principles.

|  |  |
| --- | --- |
|  |  |
| + | Further details can be found at:  [equator-principles.com/](https://equator-principles.com/) |

Equator Principles Transactions in 2023

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | Category | | |
| Sector | A | B | C |
| Mining |  |  |  |
| Infrastructure |  |  |  |
| Oil & Gas |  |  |  |
| Power |  | 3 |  |
| Others | 1 |  |  |
| Region | A | B | C |
| Americas |  |  |  |
| EMEA | 1 | 3 |  |
| APAC |  |  |  |
| Country designation | A | B | C |
| Designated | 1 | 3 |  |
| Non-designated |  |  |  |
| Independent review | A | B | C |
| Yes | 1 | 3 |  |
| No |  |  |  |
| Finance type | A | B | C |
| Project finance | 1 | 3 |  |

Category A: Projects with potentially significant adverse

social or environmental impacts that are diverse,

irreversible or unprecedented.

Category B: Projects with potentially limited adverse social

and environmental impacts that are few in number,

generally site-specific, largely reversible and readily

addressed through mitigation measures.

Category C: Projects with minimal or no social or

environmental impacts.

Country Designation is based on the World Bank's income

criteria. Projects in designated countries (High Income

OECD members) are assessed only according to local laws.

Projects in 'non-designated' countries are assessed

according to local laws and the IFC's standards.

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| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 237 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| 9 |
| 2 |
| 1 |
| 8 |
| 1 |

|  |
| --- |
|  |
|  |
| 1 |
| 3 |
| 9 |
| 12 |

|  |
| --- |
|  |
|  |
| 5 |
|  |
| 1 |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Supporting our supply chain |  |
|  | With nearly 9,0001 companies  coming from 29 countries supplying  us, our supply chain helps our  businesses deliver for our  customers, clients and colleagues. |  |
|  |  |  |

Though our businesses are geographically

diverse, more than 92% 2 of our third-party

spending is concentrated in the UK and the

US with many of them having their own

extensive supply chains.

Our supply base is diverse across scale,

ownership type and structure from

privately-held start-ups to publicly-listed

multinational corporations. Over the past

several years, Barclays has sought to

reduce the size of its supply chain while at

the same time creating opportunities for

diverse suppliers3 which encompass micro,

small or medium-sized enterprises and

diverse-owned4 businesses.

|  |  |
| --- | --- |
|  |  |
| + | Please see further details on our requirements of  external suppliers at:  [home.barclays/who-we-are/](https://home.barclays/who-we-are/our-suppliers/our-requirements-of-external-suppliers/)  [our-suppliers/our-requirements-of-external-](https://home.barclays/who-we-are/our-suppliers/our-requirements-of-external-suppliers/)  [suppliers/](https://home.barclays/who-we-are/our-suppliers/our-requirements-of-external-suppliers/) |
|  |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Highlights |  |
|  | 8.5%  Global spend with micro, small  and medium-sized enterprises  and diverse-owned suppliers  (2022: 8.5%) |  |
|  | 93%  Prompt payment rate  (2022: 93%) |  |

Third party operational and

reputational risk management

Barclays Directors, via management, must

effectively manage, monitor and mitigate

risks in our supply chain. We expect our

Third Party Service Providers (TPSP) to

make responsible decisions that, where

relevant, take our stakeholders` needs into

account in both the short and long term.

Barclays expects the TPSPs to comply with

applicable laws, regulations and standards

within the geographies in which they

operate. Barclays` standard approach5 to

new TPSP on-boarding and renewal begins

by assessing the services that are being

provided and ascertaining the level of risk.

TPSPs that are assessed as being above a

low risk of exposure from a business risk

perspective (at the point of onboarding

and on an ongoing basis) are subject to

Barclays` Supplier Control obligations

(SCOs). TPSPs to whom the SCOs apply

become managed TPSPs and are subject

to ongoing management and controls

assurance during the term of service. Prior

to contractual agreement and service go

live, these TPSPs are required to complete

a pre-contractual questionnaire which

captures their adherence to the SCOs and

Barclays` TPSP Code of Conduct (TPSP

CoC). The TPSP CoC encourages our

TPSPs to adopt our approach to doing

business and details our expectations for

matters including environmental

management, human rights, diversity and

inclusion and also for living the Barclays

Values.

Managed TPSPs are subject to controls

assurance on an annual basis to assess

whether the controls required of them

under the SCOs are maintained and

operating effectively. They are also asked

to complete an annual self-certification

against the individual topics contained

within the TPSP CoC. Where TPSPs are

unable to meet our expectations under the

TPSP CoC and SCOs, the issue will be

escalated and we will look for options to

manage the risk, which may include

additional oversight, heightened Barclays

controls or electing not to do business with

the TPSP. The TPSP CoC and SCOs are

published on the Barclays public website

for all new and existing suppliers to view

and are refreshed periodically.

Notes

1 Includes non-addressable spend and One Time

Vendors (OTV).

2 92% by invoice value

3 Spending between Barclays and diverse suppliers is

considered first-tier spending. Spending between

Barclays’ first-tier suppliers that can trace

subcontracted spend with diverse suppliers on

Barclays-specific work is considered second-tier direct

spending.

4 For Barclays, diverse suppliers are defined as either size

diverse (small and medium sized enterprises) or

ownership diverse (majority owned, controlled and

operated by protected class groups, such as women,

ethnic minorities, LGBT+, persons with disabilities,

military veterans and for-profit social enterprises)

5  We do have relationships with financial institutions and

market counterparties which, because of the nature of

the services being provided (such as international

account holding services), are not subject to our usual

TPSP on-boarding procedures and which are therefore

not subject to the TPSP CoC.

|  |  |
| --- | --- |
|  |  |
| + | Please see further details on our climate change initiatives  in our supply chain within our Achieving net zero  operations section from page [73](#i4be61753b7f243b19551b0bfbf3a2a0d_262)  within the  [Climate and](#i4be61753b7f243b19551b0bfbf3a2a0d_244)  [Sustainability report](#i4be61753b7f243b19551b0bfbf3a2a0d_244). |
|  |

Payment on time

Prompt payment is critical to the cash flow

of every business, and especially to smaller

businesses within the supply chain as cash

flow issues are a major contributor to

business failure. We aim to pay our TPSPs

within clearly defined terms, and to help

ensure there is a proper process for

dealing with any issues that may arise. We

measure prompt payment globally by

calculating the percentage of TPSP spend

paid within 45 days following invoice date.

The measurement applies against all

invoices by value over a three-month

rolling average period for all entities where

invoices are managed centrally. At the end

of 2023, we achieved 93% on-time

payment to our TPSPs compared to 93%

at the end of 2022, exceeding our public

commitment to pay 85% of TPSPs on time

(by invoice value).

The need to promptly pay our diverse

TPSPs became even more important

during the COVID-19 pandemic. Barclays

established a process to expedite the

payments for diverse TPSPs at this critical

time. This process remained in place

during 2023.

Barclays is proud to be a signatory of the

Prompt Payment Code in the UK and we

also work closely with the Small Business

Commissioner and other organisations,

including Good Business Pays, to educate

the public on late payments and the impact

they can have on businesses and business

owners, and to raise the social conscience

of larger businesses who do not pay on

time.

Diversity, Equity and

Inclusion in our supply chain

Barclays believes that diversity across our

supply chain expands our ability to attract

and harness innovative solutions in the

market that complement our own

capabilities, while simultaneously creating

value for customers and clients, and

economic opportunities for wider, under-

represented segments of society. This is

why we launched our first Global Supplier

Diversity (GSD) initiative, now celebrating

10 years of impact since 2013. The GSD

initiative aims to position Barclays as a

leader in providing inclusive procurement

opportunities and driving economic impact

to diverse businesses – diverse in size,

ownership make-up or mission.

As part of our GSD initiative in 2023, 8.5%

of our global addressable spend1 was

placed with small and medium-sized

enterprises and diverse-owned

businesses as measured by first- and

second-tier direct spending. First-tier

suppliers are contracted directly by

Barclays and second-tier direct suppliers

are subcontractors to first-tier suppliers

on Barclays-specific work. Ownership-

diverse businesses are majority owned,

controlled and operated by protected

class groups, such as women, ethnic

minorities, LGBT+, persons with

disabilities, military veterans and for-profit

social enterprises. In 2023, we added a new

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 238 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

diverse supplier category of mission-

diverse, also known as social enterprises.

Though a small segment of our diverse

supplier spend, we will recognise and

account for spend with businesses that are

driven primarily by a social mission where

they do not already qualify as small or

ownership-diverse.

In support of the GSD initiative, Barclays is

a corporate member of, and plays an

important role with, several of the most

prominent domestic and international

diverse supplier certification organisations

including National Minority Supplier

Development Council (nmsdc.org),

Minority Supplier Development UK

(msduk.org.uk), Women’s Business

Enterprise National Council (wbenc.org),

WeConnect International

(weconnectinternational.org), National

LGBTQ Chamber of Commerce

(nglcc.org), OutBritain (outbritain.co.uk),

National Veteran Owned Businesses

Association (NaVoba.org) and Disability:IN

(disabilityIn.org).

In 2021, we pledged to double our spend

with Black and women-owned businesses

by 2025, with 2020 as the baseline year,

and to grow overall spend with SMEs and

diverse-owned businesses to 10% of

Barclays annual global addressable spend.

As of 2023, we are tracking to plan to

double spend with Black and women-

owned businesses by 2025 and to meet

the overall 10% diverse supplier spend

goal.

As we institutionalise DEI across our supply

chain, the aim is for service providers,

which make up 70% of our addressable

spend to have a diversity and inclusion

policy or standard in place by 2025. We are

continuing to engage and assess our

suppliers and will report against our

progress in the future.

Note

1 Addressable spend is defined as external costs incurred

by Barclays in the normal course of business where

Procurement has influence over where the spend is

placed. It excludes costs such as regulatory fines or

charges, exchange fees, taxation, employee expenses

or litigation costs, property rent.

Modern slavery in our supply

chain

Barclays is committed to trying to identify

and seeking to address modern slavery

risks in our supply chain.

Regardless of the industry or geography in

which our Third Party Service Providers

(TPSP) operate, we require them to

comply with applicable laws and

regulations. We describe our standard

process of TPSP onboarding and renewal

in the "Third Party operational and

reputational risk management" section

above.

TPSPs that are assessed as being above a

low risk of exposure from a business risk

perspective become managed TPSPs and

are requested to complete an annual self-

attestation against topics contained within

our TPSP Code of Conduct (TPSP CoC).

The TPSP CoC identifies our expectations

with regards to respecting human rights

through areas such as occupational health

and safety, freely chosen employment,

avoidance of child labour and practices

which could lead to exploitation of workers,

freedom of religion and belief in the

workplace, freedom of association and

collective bargaining, zero tolerance for

discrimination, harassment and abuse,

accessible grievance and whistleblowing

mechanisms. These expectations (which

relate to human rights topics) are an

important part of our efforts to meet our

responsibility to respect human rights.

We continue to strengthen the way we

identify and assess modern slavery and we

describe the ways we aim to do this in our

Modern Slavery Statement.

We are continuing to work with our TPSPs

to support our ambition that those making

up 70% of our addressable spend1 will have

a modern slavery policy or standard in

place by 2025.

Note

1 Addressable spend is defined as external costs incurred

by Barclays in the normal course of business where

Procurement has influence over where the spend is

placed. It excludes costs such as regulatory fines or

charges, exchange fees, taxation, employee expenses

or litigation costs, property rent.

Human rights

Barclays continues to take action to

enhance and further embed our approach

to respecting human rights.

During 2023 we worked towards two

important milestones for our human

rights work.

We completed a saliency assessment of

human rights risks in our Corporate and

Investment Bank (CIB) financing portfolio to

guide our next steps in enhancing the CIB

approach to managing human rights risks.

Insights from the saliency assessment

informed updates to Barclays' Statement

on Human Rights, which we published

alongside this Annual Report. The

Statement seeks to reflect our evolving

approach to human rights and align with the

relevant normative frameworks, in particular

the UN Guiding Principles on Business and

Human Rights (UNGPs).

The Statement reiterates our commitment

to respecting human rights as defined in the

International Bill of Human Rights and the

International Labour Organization’s (ILO)

Declaration on Fundamental Principles and

Rights at Work (ILO Declaration). Our

approach is guided by the UNGPs and the

OECD Guidelines for Multinational

Enterprises on Responsible Business

Conduct. It also incorporates our Focus

Areas for Progress, which set out our plans

to enhance our approach to respecting

human rights.

In addition, during 2023 we continued our

efforts to monitor issues and developments

globally that may present new or elevated

human rights risks and worked to evaluate

our potential involvement and consider our

responsibilities to seek to address,

these risks.

We also continued to embed human rights

considerations into our position statements

and related enhanced due diligence

approach. For example, in our Forestry and

Agricultural Commodities Statement we

have introduced a requirement for in-scope

clients to have a policy commitment to

respect human rights across their

operations and supply chain and the

expectation that they undertake human

rights due diligence across their operations

and supply chain.

|  |  |
| --- | --- |
|  |  |
| + | For further information of our management of  environmental and social impacts in our lending  please  see page [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559). |
|  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 239 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

Saliency Assessment for CIB

Barclays worked with Shift, a non-profit and

leading centre of expertise on business and

human rights, and gathered a range of

perspectives through engagement with

both internal and external stakeholders, to

seek to understand the most salient human

rights risks to people connected to the CIB

financing portfolio.

We recognise that engagement, including

with credible proxies for affected

stakeholders, is essential to developing our

understanding of the actual and potential

human rights risks and enhancing the

robustness and legitimacy of the process.

In our external engagement, we engaged

with ten civil society organisations (CSOs),

selected by reference to their previous

contact with Barclays in relation to human

rights issues, and/or their recognised

expertise, in particular, on the intersection

between financial institutions and human

rights. Engagement took place through a

series of focused discussions, mostly

facilitated by Shift.

Our internal engagement included a series

of workshops with colleagues from a range

of functions including Sustainability, Risk,

Compliance, Legal and the business and

across the US, UK and APAC, followed by

deep dive interviews with some of these

colleagues.

The insights gathered during this proactive

engagement, complemented by insights

from previous relevant engagement with

CSOs, as well as desk-based research by

the Barclays Social Policy team and Shift,

informed the identification of a long list of

human rights impacts.

These impacts were then prioritised,

through consideration of the relative

severity of the impacts on people and their

likelihood of occurrence, to produce a

shortlist. This list and related analysis were

presented to core stakeholders to review

and test the application of the severity and

likelihood criteria to finalise our five salient

human rights issues, as set out in the table

at right.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Salient Issue | |  | What is the issue? |
|  | Human  impacts of  climate  change and  the energy  transition |  | Climate change presents a number of physical risks and its impacts are varied and  multifaceted. For example, sea level rise and extreme weather can threaten the  rights to housing, to adequate standard of living, to food and water; and predicted  increases in disease impact right to health. The transition from fossil fuels to low  carbon energy is not without its own risks and challenges, climate change  mitigation activities can contribute to impacts such as job losses and energy  scarcity for communities who depend on fossil fuels. The development of clean  energy sources can also have human rights impacts including exploitative land  and labour practices as well as impact vulnerable communities like Indigenous  Peoples. |
|  | Indigenous  Peoples |  | International law guarantees the rights of Indigenous Peoples, including traditional  lands, cultural preservation, livelihoods, knowledge,  security and their right to give  or withhold their consent for any action that would affect their lands, territories or  rights (Free Prior and Informed Consent (FPIC)).Indigenous Peoples' rights are  increasingly being threatened, particularly in relation to the activities of certain  sectors such as extractive, energy, and agriculture. The transition to renewable  energy could exacerbate these impacts; recent research suggests that over half  of energy transition metals and minerals projects are located on or near  Indigenous Peoples' lands1. |
|  | Land  Rights |  | Business practices such as community relocation and resettlements are not  uncommon in certain sectors, such as mining and agriculture, and can impact a  range of human rights, including the right to adequate housing, food, water,  health, education, and decent work. Resistance and protest against resettlement  or other potential infringements of land-related rights by human rights defenders  and local communities could also expose people to risk of additional adverse  impacts such as suppression of freedom of association, detention or even  physical harm. |
|  | Modern  Slavery |  | An estimated 50 million people were living in situations of modern slavery on any  given day in 2021, according to the latest Global Estimates of Modern Slavery 2.  Modern slavery violates all human rights relating to decent work. However,  modern slavery can also impact a multitude of other rights, for example to health,  family life, freedom of movement, and even freedom from torture, cruel, inhuman  or degrading treatment. The impacts of modern slavery can be severe and lasting,  and this issue is prevalent in all geographies and most sectors. |
|  | Weapons and  dual-use  technology  exports |  | Technologies associated with the Defence and Security sector are continuously  developing. This includes advancements such as autonomous weapons and dual-  use technology which could be used in a multitude of applications including in  weapons and surveillance technology. Weapons and dual use technologies, if  misused, have the potential to cause some of the most severe human rights  violations, in particular, in the context of repressive state action or conflict. |
| Notes:  1 nature.com/articles/s41893-022-00994-6  2 cdn.walkfree.org/content/uploads/2022/09/12142341/GEMS-2022\_Report\_EN\_V8.pdf | | | |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 240 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

We have subsequently identified our Focus Areas for Progress, setting out the actions we intend to undertake over time to enhance our

approach to the management of our salient issues across the Barclays Group. We will report our progress in these Focus Areas in future

Annual Reports.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Focus Areas for Progress | | | | | | | | |  |
|  |  |  | Arrow_BrightBlue.png |  | Arrow_BrightBlue.png |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Corporate  Culture |  | Saliency  Assessments |  | Policies  and EDD |  | Just  Transition |  | Remedy |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Strengthen a culture of  respect for human  rights  • Build capacity to  support colleagues’  understanding of  human rights risks  and responsibilities |  | Identify salient issues  beyond CIB  • Extend saliency  assessment to other  areas of the bank,  looking to engage  with internal and  external stakeholders |  | Enhance sustainability  policies and EDD to  reflect salient issues for  CIB  • Review existing  sustainability policies  and EDDs and work to  integrate salient issues  • Evolve our approach to  engaging with clients  when responding to  salient issues |  | Support a transition to a  low-carbon economy  which accounts for the  social risks as well as the  opportunities  • Work to consider just  transition in our  Transition Plan and  Client Transition  Framework  • Continue engagement  to help shape the way  just transition is defined  and implemented in  practice |  | Develop our approach to  remedy  • Explore approach to  remedy in engagement  with clients |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |

Corporate culture

We aim to take steps to build capacity to

support colleagues' understanding of

human rights risks and responsibilities by

providing tailored training and guidance.

Saliency assessments

Taking an approach based on a risk-to-

people lens, we prioritised CIB as an area

for review. Our aim is to continue to

identify the salient human rights impacts

we may be connected to through our

operations and value chain. We aim to

initiate further saliency assessments,

incorporating engagement with

appropriate stakeholders.

Policies and enhanced due

diligence

Our aim is to enhance our existing position

statements and associated enhanced due

diligence processes to better reflect the

salient human rights issues identified

through our assessment of CIB.

Additionally, in response to analysis of our

exposure to salient issues through our CIB

financing portfolio, we may consider the

development of additional position

statements. To build on our risk

identification and assessment, we aim to

develop a pilot for engaging with clients in

response to the salient risks identified.

Just transition

Barclays seeks to support a just transition

which accounts for the potential social

risks as well as opportunities of the energy

transition and seeks effective dialogue

with relevant stakeholders.

We have taken steps to pilot the approach

to just transition in our Client Transition

Framework, and will consider the findings

of the pilot in our engagement with clients.

We also intend to include social

considerations as we develop our

transition plan.

We believe that industry engagement is

essential to advance our collective

understanding and strategy to ensure a

just transition. As such we intend to

continue to work with peers and industry

groups, and we have become founding

members of the LSE Just Transition

Finance Lab to help shape the way just

transition is defined and implemented in

the financial sector.

|  |  |
| --- | --- |
|  |  |
| + | For more information on our approach to just  transition, please see page [124](#i4be61753b7f243b19551b0bfbf3a2a0d_7854). |
|  |

Remedy

We recognise the importance of remedy in

the context of human rights and aim to

develop our understanding of good

practice in this area. We will look to explore

approaches to remedy through our

engagement with our clients.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 241 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Supporting customers  through Barclays UK |  |
|  |  |  |
|  | Barclays has a large retail presence  in the UK, offering a wide range of  products and services to c.20 million  customers through Barclays UK. |  |
|  |  |  |

We recognise that there is a heightened

need to help customers who may be

experiencing financial vulnerability due to

the inflationary pressures on household

budgets and increased interest rates. We

are endeavouring to support customers

during these challenging times, and during

2023 have continued to focus on four key

areas:

1.using data analytics to determine which

customers are in need of support and

the appropriate type of support;

2.engaging those customers impacted to

increase awareness of products, tools

and support available;

3.understanding customers’ needs and

developing solutions to provide greater

support; and

4.ensuring colleagues have, and are aware

of, the financial health tools to enable

them to support customers.

To better support financially vulnerable

customers, we have enhanced our

Barclays' tools, training, support and

systems, continuing to improve our

ongoing support when customers need us

the most.

In July 2023 Barclays implemented support

measures following the introduction of the

Mortgage Charter by HMT. These

measures provided residential mortgage

customers, who are up to date with their

payments, with a range of support options

which included:

• The ability to apply to extend the term of

their mortgage to reduce their monthly

payment amount .

• Apply to switch their mortgage from

repayment to interest only for a period

of 6 months to temporarily reduce their

monthly payment amount.

Barclays continued a nationwide

engagement campaign into 2023,

providing practical support and guidance

to the cost of living crisis. Launching at the

end of 2022 and reaching across 254 local

and national commercial radio stations; in

print across 12 major national dailies and

26 major regional titles. In Q1/Q2 2023,

the campaign extended with additional AV

campaign across TV, cinema and VOD

reaching 99% of our core audience with

practical support and guidance.

We delivered content targeted to the

needs of our most vulnerable audiences

with content across video, social media

and owned channels.

In the second half of the year, we launched

new content marketing activity in

collaboration with influencers to engage

consumers around topics of everyday

money management, travel and

remortgaging. Guiding people on how to

make money work better for them through

the rising pressures of inflation, with this

activity targeted at both low financial

wellbeing and broader audiences. This was

supported with marketing across our

branches and locals that provided

guidance on the benefits of the Barclays

app to support with everyday money

management and travel.

Provided ongoing Cost of living support by

proactively contacting over 1.38m

customers with proactive SMS offering a

conversation to provide support and

guidance on managing their finances and

offering them help ranging from budgeting

to direct financial support, where required

guiding them towards dedicated functions

such as Barclays Financial Assistance (BFA)

or external agencies such as Step Change.

Providing knowledge and expertise

through our colleagues with the aim to

offer our customers more tools and

features to educate them on managing

their money, including by giving them

guidance on how to use our digital

platforms via the Digital Eagles, or

supporting them in their understanding of

financial products, how to build financial

plans, and save money through budgeting

via our Barclays Money Mentors®.

Our early intervention strategies assess all

customers who hold a retail product to

determine if we think they would benefit

from our support. These customer

engagement strategies are bank-initiated

and largely focused around proactive

communications, based on sets of

customer behavioural triggers, whilst we

also support customers who initiate

contact with us.

Our primary focus is to support customers

whose account behaviours are showing

signs of possible early financial difficulty,

and look to help customers maintain or

regain control of their finances.

|  |  |
| --- | --- |
|  |  |
| + | Further details can be found on page  [39](#i530136ace7c34ac8be78be235606a81b_1-1-1-1-2357619)  in relation to  Consumer Duty within the Strategic Report  in Part 1  of the Annual Report |
|  |

Access to banking

Customers are looking for more

convenient, simpler ways to bank that fit

their lives, including banking digitally: our

mobile app has over 11.0 million active

users. We are continuing to help deliver

these solutions at pace.

Alongside our investment in technology

enabling digital customers to access tools

and products whenever they need them,

we’re aiming to transform the role of

physical locations across the UK to ensure

non digitally engaged customers can still

access banking. We are working with other

banks, the Post Office and LINK, to keep

Barclays at the heart of the community.

We have launched our own initiatives,

including a cashback without purchase

service and Barclays Local - the largest

network of alternative branch formats in

the UK, with a presence in over 300

locations.

Alongside these changes, we are investing

in multi-skilled training for our colleagues

so they are better able to serve customers

in ways that meet their needs today as well

as breaking down internal barriers to

enable quicker resolution of customer

queries.

|  |  |
| --- | --- |
|  |  |
| + | Further details on mobile banking vans and how to  book an appointment can be found at:  [events.uk.barclays/barclaysvan/](https://events.uk.barclays/barclaysvan/) |
|  |

Economic crime and scams

We take our responsibility to protect our

customers’ money very seriously and are

proud to have one of the lowest scam rates

and highest reimbursement rates in the

industry. This is due to our continued

investment in robust security systems and

our established programme to educate

customers and prevent them from falling

victim to scams.

We have a dedicated Fraud and Scams hub

on the Barclays website, which hosts a

variety of content and resources to help

the public learn how to keep themselves

safe.

Additionally, for each of the 50 million+

payments our UK customers make every

month, our fraud detection systems and

machine learning models determine in less

than a second if it is likely to be a fraudster

rather than the customer, or if our

customer appears at risk of being

scammed. If the transaction seems risky,

the customer is presented with additional

checks prior to the payment being

released.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 242 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

We continue to invest in security features

that protect against fraud and scams,

including ‘App ID’, which allows customers

to verify they’re speaking to a Barclays

colleague and not an impersonator.

We are also part of the ‘Do not originate’

scheme, created in partnership with the

telecommunications industry, UK Finance

and Ofcom, to prevent our most common

inbound helpline phone numbers from

being used in a scam.

We are proud signatories of the

Contingent Reimbursement Model Code,

providing measures to help prevent

Authorised Push Payments scams taking

place and building increased consumer

protection standards for customers of

signatory firms.

We are founding members of Stop Scams

UK, a cross-industry group made up of

banks, telecoms and tech firms that have

come together to seek to put an end to

scams by collaborating, sharing best

practices and engaging with the

government and regulators to make it

harder for scammers to operate.

We have published a series of policy

recommendations to tackle the spread of

scams.

If you suspect that you have been approached by

fraudsters please tell the FCA using the share fraud

reporting form at  fca.org.uk/scams

You can also call the FCA Helpline on 0800 111 6768

or through Action Fraud on 0300 123 2040

|  |  |
| --- | --- |
|  |  |
| + | Frontier Economics report on Tacking Fraud and  Scams:  home.barclays/news/press-releases/2023/08/eight-  in-ten-brits-feel-unsafe-on-social-media-due-to-  scammers/ |
|  |

Digital accessibility

We aim to ensure that our digital services

are easy to see, hear, understand and use

for all customers, including those with

disabilities.

Collectively we seek to deliver digital

services and workplace tools that promote

disability inclusion and meet accessibility

requirements set out in the Web Content

Accessibility Guidelines (WCAG) 2.2 AA

level.

|  |  |
| --- | --- |
|  |  |
| + | The Barclays Accessibility statement  [barclays.co.uk/accessibility/statement/](https://www.barclays.co.uk/accessibility/statement/) |
|  |

Building financial wellbeing

As part of our aim to deliver a world-class

money management experience and help

money work for our customers, particularly

through the cost of living crisis, we are

delivering more tools and features to

educate them on managing their money.

We are providing knowledge and expertise

through our colleagues, whether that be

helping customers to use our digital

platforms via the Digital Eagles, or

supporting customers in their

understanding of financial products, to

build financial plans, and save money

through budgeting via our Barclays Money

Mentors®. The Barclays Money

Management Hub gives us the ability to

provide proactive money management

information directly to customers, giving

them a better grasp on their spending

behaviours and steps they can take to

improve their financial wellbeing and

provide customers greater control over

their finances.

We also have a range of early intervention

strategies which aim to support customers

whose account behaviours may be

showing signs of lacking financial resilience.

These strategies largely focus on pro-

active communication with the customer,

based on sets of customer behavioural

triggers, and look to support customers to

help them maintain or regain control of

their finances. Where customers engage

with these contact strategies, our BFA

colleagues provide broad money

management advice and, where

appropriate, may suggest a range of

solutions to manage their financial

situation. This suite of solutions includes

forbearance and non-forbearance options.

Gambling

Barclays understands that gambling and

financial difficulty can often go hand in

hand and that customers may sometimes

find it hard to ask for help. We have

dedicated training available for colleagues

to help them understand and support

customers impacted by problematic

gambling. Our Specialist Colleagues are

available to help customers in complex

situations and sign post where needed to

external support charities and

organisations.

|  |  |
| --- | --- |
|  |  |
| + | Further details can be found at:  [barclays.co.uk/gambling-support/](https://www.barclays.co.uk/gambling-support/) |
|  |

Domestic abuse

To support customers impacted by

domestic abuse, we have partnered with

Refuge, a national charity providing

specialist support for women and their

children experiencing domestic abuse.

This enables us to direct those impacted

by domestic abuse to expert advice and

assist survivors with the opening of bank

accounts and gaining access to banking

services in situations where they may not

have the requisite documentation. In 2023,

the Barclays Refuge Partnership was

recognised at the Business Charity Awards

for Addressing Economic and Tech Abuse.

We are a committed signatory to the

revised UK Finance Domestic Abuse Code

of Practice, which sets out how

participating banks and building societies

should support customers who are victims

and survivors of economic or financial

abuse.

Homelessness

We continue to support those with limited

documentation such as homeless people

to open a basic current account. Barclays

has partnered with charities to help those

most impacted by the current

environment through dedicated financial

inclusion support.

Bereavement

We continue to prioritise making this

extremely difficult time in people’s lives a

little easier. Our programme of work to

enhance the customer experience across

all of our channels, including physical

locations and online remains front of mind.

Highlights this year, include: delivery of an

automated, online bereavement

notification and document upload

capability and a new email confirmation,

providing real time acknowledgment of the

bereavement notification. We’ve also

made it easier for colleagues to help

customers needing probate support with a

referral to Co-op Legal Services, who we

have a partnership with. Further

enhancements are planned for 2024.

|  |  |
| --- | --- |
|  |  |
| + | Further details can be found at:  [barclays.co.uk/what-to-do-when-someone-dies/](https://www.barclays.co.uk/what-to-do-when-someone-dies/notify-us/)  [notify-us/](https://www.barclays.co.uk/what-to-do-when-someone-dies/notify-us/) |
|  |

Authorised users

Since launching Authorised User in 2022,

we’ve continued to give customers the

ability to effectively manage their finances

with support of other trusted persons.

In October 2023, we’ve made this even

easier by removing the monthly service fee

for customers to add someone they trust

to spend on their account.

|  |  |
| --- | --- |
|  |  |
| + | Further details can be found at:  [barclays.co.uk/ways-to-bank/authorised-users/](https://www.barclays.co.uk/ways-to-bank/authorised-users/manage-account/)  [manage-account/](https://www.barclays.co.uk/ways-to-bank/authorised-users/manage-account/) |
|  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 243 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

Specialist support team

We have a dedicated specialist team who

receive in-depth training on a wide variety

of vulnerable scenarios. They are available

to support colleagues and customers in

complex and heightened vulnerable

circumstances.

Accessibility & Vulnerability

(A&V) Indicators Platform

Over 2023 we have enhanced our

Accessibility & Vulnerability framework,

giving colleagues within Barclays the ability

to record disclosed customer vulnerability

on our systems. This allows us to provide

customers with the correct level of service

based on their particular needs and/or

adjustments. We have focused on

improving the colleague journey to include

support on soft skills, internal & external

sign posting and escalations to specialist

teams. This ensures colleagues have the

best available support in the moment when

dealing with customers in vulnerable

circumstances.

Training for colleagues

Over 20,000 Barclays UK colleagues

completed the mandatory Customers in

Vulnerable Circumstances annual e-

learning modules. The training improves

awareness and understanding of

vulnerability for our frontline and head

office colleagues.

We also this year launched ‘Threat to Life’

training materials for our colleagues to

help further support colleagues when

liaising with customers who are suicidal. In

addition we rolled out new induction

training to equip new colleagues with how

to identify and support customers who

may be vulnerable or going through a life

event.

Barclays UK Performance

Framework

Within Barclays UK, the Performance

Framework is in place to ensure a

sustainable commercial performance. The

framework looks to mitigate the risks of

inappropriate practices, such as ensuring

there is no undue pressure on colleagues

to sell products, which can result in mis-

selling.

Alongside the Performance Framework we

have introduced Performance Standards

to set clear expectations, identify

development opportunities, and deliver

sustainable performance for our

customers and clients.

Basic current account

Since 2015, we have been offering our

basic current account to individuals who

may not be eligible for a standard account

access to banking, including over the

counter services, access to ATMs, and

digital banking and free text alerts to

manage finances. There were over

650,000 Barclays basic current accounts

open at the end of 2023.

Access to a transactional bank account

enables consumers to benefit from bill

reductions through paying by direct debit

and access to cheaper goods and services

on the internet, to help them along their

financial journey. If their circumstances

change, customers on the basic current

account are able to apply for a standard

Barclays current account at any time.

Periodically we also review accounts to

upgrade customers from Basic Current

Account to Barclays Bank Account where

eligible.

|  |
| --- |
|  |
| Number of basic current accounts  (#) |

|  |
| --- |
|  |
| 2023 |
| 2022 |
| 2021 |

![41231686053776]()

Barclays mortgages and

first-time buyers

2023 has been a year of change in the

mortgages market. There were eight

successive increases in the Bank of

England Base Rate, which led to significant

increases in the cost of borrowing for

mortgage customers. Our commitment

has remained to support customers

through this period. In late 2022 we

changed our policy for customers reaching

the end of their fixed rate period, to allow

them to rate switch earlier, helping over

200,000 customers in 2023 secure a new

product up to 180 days in advance when

their existing rate is ending. The Mortgage

Charter mandated participating banks to

implement 180 day switching in June 2023,

by which time we had already been live with

the 180 day switching for over eight

months.

Despite the challenges with the market in

2023, we still helped almost 22,000 first-

time buyers get onto the property ladder.

We have continued to support customers

buying their first home with 95% loan-to-

value mortgages through the UK

Government Mortgage Guarantee

Scheme, and Barclays Family Springboard

Mortgage.

The Mortgage Guarantee Scheme offers

95% LTV mortgages which are backed by

a UK Government guarantee. Customers

can apply for the scheme with a minimum

deposit of 5% of the property purchase

price, and it is available for first-time

buyers and those looking to make their

next move on the property ladder.

Financial inclusion in our US

consumer business

The Community Reinvestment Act (CRA)

is a US federal law designed to encourage

financial institutions to help meet the

needs of borrowers in all segments of their

communities, including low and moderate-

income neighbourhoods. Barclays meets

the CRA requirement by supporting and

investing in local Community Development

Financial Institutions (CDFIs), small-

medium businesses and non-profits.

The success of CDFIs, small-medium

businesses and non-profits are key to a

thriving community. Barclays has

predefined goals with specific

performance targets that we must meet

each year in order to be considered in

compliance with CRA guidelines. Barclays

has met its CRA goals for 2023, evidencing

that we are continuing to invest in the

communities where we live, work and

serve.

Barclays Bank Delaware (BBDE) is

committed to fair and equitable treatment

of all prospective and existing customers

without regard to race, sex, colour,

national origin, religion, age, marital status,

disability, sexual orientation, military

status, gender identity, familial status,

Limited English Proficiency, receipt of

public assistance income, and good faith

exercise of rights under the Consumer

Credit Protection Act.

We believe Barclays’ core Values of

Respect, Integrity, Service, Excellence, and

Stewardship reflect our commitment to

fair lending and fair treatment principles

and practices. We strive to develop long-

term relationships by providing products

and services that meet prospective and

existing customer needs, avoid causing

prospective and existing customer

detriment or harm, and place our

prospective and existing customers'

interests at the heart of our strategy,

planning, and decision-making processes.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 244 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

#### The Barclays Way

The Barclays Way is our Code of Conduct. Together with more formal

policies and practices, this provides a clear path towards achieving a

positive and dynamic culture within the Group.

Our commitment to being a responsible

business includes seeking to ensure that:

• we conduct ourselves in line with The

Barclays Way, our Code of Conduct, to

create the best possible working

environment for our colleagues

• we treat our customers fairly and the

products and services we deliver are

transparent and responsible

• we operate in line with relevant laws and

regulations including those applicable to

financial crime

• we safeguard the data that has been

entrusted to us.

Our Code of Conduct reflects the trust

that millions of people place in us every

day. We know that trust is earned by

repeatedly doing the right thing. We

believe the best way to build that trust is to

invest in our culture and support our

people in the choices they make every day,

with guidance and policies that help them

do this.

That starts with our Purpose, Values and

Mindset, and is locked into our

organisation through The Barclays Way,

the touchstone for everyone in Barclays on

the standard of conduct we expect, setting

an unequivocal tone from the top about

who we are and what we stand for.

|  |
| --- |
|  |
|  |
| “In challenging times such as these, it is more important  than ever that we conduct ourselves in the right way.  The Barclays Way sets out the standards of behaviour  we should all aspire to in our professional lives.  It is a guiding light for everyone in Barclays, helping us  to make the right decisions every day.” |

The Barclays Way was launched in 2013,

replacing a number of existing codes of

conduct with a single document. Endorsed

by our Chairman, it governs our way of

working across our business globally and

constitutes a reference point covering all

aspects of colleagues’ working

relationships, specifically but not

exclusively with other Barclays employees,

customers and clients, governments,

regulators, business partners, suppliers,

competitors and the broader community.

It is aligned to the Code of Professional

Conduct, published by the Chartered

Banker Professional Standards Board,

which sets out the ethical and professional

attitudes and behaviours expected of

bankers. Barclays subscribes to this code

and is committed to embedding its broad

principles into our business.

The Barclays Way includes information and

guidance on how employees are expected

to behave and take personal accountability

for making decisions. We apply a range of

criteria, over and above financial

considerations, aimed at building a

sustainable, strong and profitable business

for the long term and adding value to our

business relationships and the broader

communities in which we live and work. We

provide guidance across all key

stakeholder groups, including servicing our

customers and clients, promoting respect,

diversity and performance in the workplace

and maintaining strong governance,

robust controls and strict ethical

standards.

The Barclays Way also includes advice and

guidance on speaking up and raising

concerns. It is important for the success of

Barclays, and for the safety and wellbeing

of our customers, clients and colleagues,

that we encourage a culture that supports

speaking up when things aren’t as they

should be. All colleagues are required to

undertake training on The Barclays Way.

We know that our success over the long

term is based not just on how well we run

the organisation commercially, but also on

how well we manage it to protect the

environment, support positive social

progress and make responsible, well-

governed decisions. We are focused on

the areas where we can have the greatest

long-term impact: making growth ‘green’,

sustainable and inclusive; managing the

environmental and social impacts of our

business; running a responsible business;

and investing in our communities.

|  |
| --- |
|  |
| Employee survey results  % |

"I believe that my team and I do a good job

of role modelling the Values every day"

|  |
| --- |
|  |
| 2023 |
| 2022 |

![4002]()

|  |
| --- |
|  |
| % of colleagues completing mandatory  training on The Barclays Way |

99%

|  |  |
| --- | --- |
|  |  |
| + | The Barclays Way Code of Conduct is available at:  [home.barclays/citizenship/the-way-we-do-business/](https://home.barclays/sustainability/esg-resource-hub/statements-and-policy-positions/)  [code-of-conduct/](https://home.barclays/sustainability/esg-resource-hub/statements-and-policy-positions/) |
|  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 245 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

#### Whistleblowing

#### We support a culture

#### where colleagues feel

#### safe to speak up.

Barclays is committed to providing a

respectful and inclusive environment to

work in and colleagues are encouraged to

speak up about actions and behaviours

that have no place in the organisation. 83%

of global respondents of the 2023 Your

View survey said it was 'safe to speak up' at

Barclays.

Colleagues are encouraged to speak up

directly to their management, Compliance,

HR or Legal. However, where they do not

feel comfortable using these avenues, the

Raising Concerns process is available.

The Raising Concerns team carefully

assess concerns and refer them to the

most appropriate team for review and,

where appropriate, investigation. All

concerns are taken seriously and managed

sensitively and confidentially. Details about

the Raising Concerns reporting channels

are available both internally and externally.

One of the channels to which concerns

may be referred is the whistleblowing

programme. Information about the

whistleblowing programme is provided to

colleagues globally, including through

annual mandatory training.

Whistleblowing relates to concerns which

fall within the wider public interest. This

may include a breach of our policies or

procedures, breaches of law and regulation

or other behaviour that harms or is likely to

harm the reputation or financial wellbeing

of the Group.

Concerns assessed by Raising Concerns

as whistleblowing are directed to a

dedicated impartial team within the

Compliance function. All whistleblowing

concerns are taken seriously, and controls

are in place to protect the confidentiality

and identity of whistleblowers.

Barclays has a zero-tolerance approach to

retaliation against any whistleblower or any

individual who has provided information as

part of an investigation. Any act of

retaliation by a colleague may result in

disciplinary action, including dismissal.

In 2023, the whistleblowing team received

a total of 67 whistleblowing concerns

including 19 retaliation concerns.

25% of whistleblowing concerns closed in

2023 were found to have some level of

substantiation and other issues were

identified in a further 38% of concerns.

None of the retaliation concerns closed in

2023 were substantiated.

In addition, 54 actions arising from

concerns raised in 2023 were

implemented to address issues identified

during the course of investigation

concerns . This includes

recommendations to enhance processes

and controls.

The Chair of the Group Board Audit

Committee is the Group Whistleblowers’

Champion and the Chair of the Barclays

Bank UK PLC (BBUKPLC) Board Audit

Committee is the BBUKPLC

Whistleblowers’ Champion. In 2023, Julia

Wilson became the Group Whistleblowers’

Champion on her appointment as Chair of

the Group Board Audit Committee.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Whistleblowing cases closed by region |  |
|  | Whistleblowing_MAP.jpg |  |

|  |
| --- |
|  |
| Whistleblowing cases opened by (top 4) categories |

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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| 1 Breach of controls,  process or other | 21 | | | | | | | | | | | | | | | | | | | | |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| 2 Retaliation | 19 | | | | | | | | | | | | | | | | | | |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| 3 Fraud | 15 | | | | | | | | | | | | | | |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| 4 Market misconduct | 5 | | | | |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| 5.  Other | 7 | | | | | | |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

The Whistleblowers’ Champions have

responsibility for ensuring and overseeing

the integrity, independence and

effectiveness of Barclays’ whistleblowing

programme across their respective

entities. Their oversight is supported by

periodic impartial reviews and assurance of

the whistleblowing process.

Barclays also works with Protect, the UK

Whistleblowing Charity. The

whistleblowing programme has

benchmarked highly under Protect’s best

practice benchmark framework.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 246 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

60

Cases closed

in 2023

#### Tax

#### Barclays supports a fair and transparent tax system.

|  |
| --- |
|  |
| “We received the PwC Building Public Trust  Award 2023 for Tax Reporting in the FTSE 350  (Multinationals) Group.” |

Barclays takes a responsible approach to

tax. We have strong governance and risk

management over tax risk and are

committed to transparency around tax.

We know that it is important for our

investors, customers and clients,

regulators, tax authorities and other

stakeholders to understand our approach

to tax and our tax contribution in the

countries in which we operate.

In recognition of the clear explanations we

provide of our tax affairs and our

responsiveness to both stakeholder

interest and the continually changing tax

transparency landscape, we received the

PwC Building Public Trust Award 2023 for

Tax Reporting in the FTSE 350

(Multinationals) Group. This award reflects

the transparency of both our 2022

Country Snapshot and the tax reporting in

our 2022 Annual Report.

|  |  |
| --- | --- |
|  |  |
| + | For further details, see our Country Snapshot Report  at:   [home.barclays/annualreport](http://home.barclays/annualreport) |
|  |

|  |
| --- |
|  |
| Taxes paid globally |

£2,505m

|  |
| --- |
|  |
| Taxes paid globally  £m |

![219]()

|  |  |
| --- | --- |
|  |  |
| n | Corporation tax and  withholding taxes |
| n | Employer payroll  taxes |
| n | Irrecoverable VAT |
| n | Bank levy |
| n | Other taxes including  business rates |
| 2022 taxes paid globally  £2,255m | |

Tax contribution

We continue to make substantial tax

contributions across the jurisdictions in

which we operate, both in terms of taxes

paid and taxes collected. Our total tax

contribution for 2023 was £5,899m. This

includes taxes paid of £2,505m which

represent a cost to us, and taxes collected

on behalf of governments of £3,394m.

|  |
| --- |
|  |
|  |

Barclays was ranked as the sixth-largest

UK taxpayer, in terms of taxes paid, in the

most recent PwC Total Tax Contribution

survey of the One Hundred Group (‘100

Group’). The 100 Group represents

members of the FTSE 100 along with

several large UK private companies. Over

the last decade we have paid over £14bn of

taxes in the UK alone.

Approach to tax

Barclays’ Purpose is to deploy finance

responsibly to support people and

businesses, acting with empathy and

integrity, championing innovation and

sustainability, for the common good and

the long term. Our approach to taxation,

also known as our tax strategy, is aligned

with this Purpose as well as our Values of

Respect, Integrity, Service, Excellence and

Stewardship.

Our approach to tax has three core

objectives:

• responsible approach to tax,

• effective interaction with tax authorities

and

• transparency in relation to our tax

affairs.

We manage our tax affairs in accordance

with our Tax Principles, Tax Code of

Conduct and HMRC’s Code of Practice on

Taxation for Banks and aim to file our

returns on time and pay the correct

amount of tax. We make clear disclosures

to tax authorities and we are committed to

only dealing with customer and client

assets that have been appropriately

declared to the relevant tax authority.

We are also committed to being a leader in

tax transparency. We have published

details of the taxes we pay by country and

our approach to tax since 2013, and have

chosen to expand our external publications

such as the Country Snapshot.

Our Country Snapshot is publicly available,

it sets out our approach to tax in detail,

including our Tax Principles, and is

reviewed and approved annually by the

Barclays PLC Board.

Key highlights from our approach to

tax include:

• we follow clear Tax Principles that we

have published. These allow us to

balance the needs of all our

stakeholders and make clear that tax

planning must support genuine

commercial activity,

• as a result of this approach, transactions

which artificially transfer profits into a

low tax jurisdiction would not be

consistent with our Tax Principles,

• we seek to comply with the spirit as well

as the letter of the law and we take

account of established practice in the

territories in which we operate. We are

transparent in both the disclosure of our

tax affairs to tax authorities as well as

our tax reporting to other stakeholders,

and

• we aim to comply with all of our tax

obligations in the territories in which we

operate and where there is uncertainty

we may seek external tax advice in order

to help ensure our tax filings are

appropriate.

Tax governance, control and

risk management

As a Global Systemically Important Bank,

our Group-wide risk and governance

procedures are subject to continuous

review and scrutiny. More details on our

approach to tax governance, control and

risk management can be found in our

Country Snapshot, the key highlights of

which include:

• our Board has ultimate responsibility for

tax matters and the Board Audit

Committee oversees our approach

to tax,

• at Barclays, risks are identified and

managed through our ERMF, which

supports the business in its aim to

embed effective risk management and a

strong risk management culture. Under

the ERMF all risks, including tax risk, are

managed in accordance with a ‘three

lines of defence’ model,

• as part of the ‘first line of defence’ the

tax department identifies and manages

tax risk by developing appropriate

policies, standards and controls to apply

across our organisation. Risk and

Compliance comprise the ‘second line

of defence’, and Barclays Internal Audit

are the ‘third line of defence’, and these

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 247 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

functions review, challenge and provide

assurance to the Board in relation to the

effectiveness of governance, risk

management and controls including

those relating to tax risk,

• we are subject to the Sarbanes-Oxley

Act control requirements in relation to

financial statements disclosures

including those related to tax,

• our tax department comprises

appropriately qualified in-house

professionals who are subject to clear

standards including that they uphold our

Tax Principles and follow our Tax Code

of Conduct, which is an integral part of

how we operate,

• our governance requires that suitably

qualified people are involved in decisions

related to tax, tax is fully taken into

account when making business

decisions and tax risk is identified,

assessed and kept under review, and

• we have no tolerance for tax evasion and

have well-established mechanisms for

raising concerns about unethical or

unlawful behaviour through our

‘Whistleblowing’ policy, which applies

equally to tax matters.

Stakeholder engagement and

management of concerns

related to tax:

Our reputation is very important to us and

we take our external stakeholders’

expectations into account when we make

decisions in relation to our tax affairs. More

details on our approach to stakeholder

engagement and managing stakeholder

concerns related to tax can be found in our

Country Snapshot, and key highlights

include:

• we believe that it is important to be

transparent in the disclosure of our tax

affairs both to tax authorities and

stakeholders more broadly,

• our dealings with tax authorities are

handled proactively, constructively and

transparently, in real-time where

possible,

• we recognise that early resolution of our

tax affairs is in everyone’s interest. We

have ongoing engagement with tax

authorities to discuss their inquiries and

material issues in relation to our tax

affairs, and we respond to feedback

from tax authorities,

• where we face significant uncertainty in

relation to the application of tax law, we

may seek to agree with the tax authority

how the tax law should apply,

• where relevant we seek to reach

agreement with tax authorities using

mechanisms available to all taxpayers

including Advance Pricing Agreements

and Mutual Agreement Procedures to

clearly establish in which territories our

profits should be taxed,

• we engage with governments, tax

authorities and NGOs through public

consultations and other discussions to

assist with the development of tax policy

and the improvement of tax systems,

and maintain our transparency with

these stakeholders, and

• we cooperate with tax authorities

globally to reduce the scope for

individuals and companies to evade tax,

and have met all of our 2023 information

reporting obligations under the

Common Reporting Standard and

Foreign Account Tax Compliance Act.

|  |  |
| --- | --- |
|  |  |
| + | The BPLC Board Audit Committee is responsible for  considering the Group's tax strategy and overseeing  compliance with the Group's Tax Principles. Please  refer to  page  [169](#i33b3f2f534e9480dbae9932301c15a85_9-0-1-1-1841111)   for details of BPLC Board Audit  Committee oversight of tax related matters |
|  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 248 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

#### Financial crime

Barclays recognises that economic crimes have an adverse effect on

individuals and communities wherever they occur. Endemic economic crime

can threaten laws, democratic processes and basic human freedoms,

impoverishing states and distorting free trade and competition.

Barclays recognises that financial crime

has an adverse effect on individuals and

communities wherever it occurs. Endemic

financial crime can threaten laws,

democratic processes, and basic human

freedoms, impoverishing states and

distorting free trade and competition.

Barclays is committed to conducting its

global activities with integrity and

respecting its regulatory, ethical, and social

responsibilities to:

a. Protect employees, customers, and

others with whom we do business, and

a. Support governments, regulators, and

law enforcement in wider financial crime

prevention.

Barclays does not tolerate any deliberate

breach of financial crime laws and

regulations that apply to our business and

the transactions we undertake.

We have adopted a holistic approach to

financial crime risk management and have

one group-wide Financial Crime Policy.

The Financial Crime Policy applies to all

businesses, legal entities and employees. It

is designed to ensure that Barclays has

adequate systems, procedures, and

controls in place to manage the risk of

being used to facilitate financial crime and

to manage the legal, regulatory, and

reputational risks associated with financial

crime. Employees are made aware that

failure to comply with the Financial Crime

Policy may give rise to disciplinary action,

up to and including dismissal.

The Financial Crime Policy sets control

obligations to manage four key risks: anti-

bribery & corruption (ABC); anti-money

laundering & counter-terrorist financing

(AML); anti-tax evasion facilitation (ATEF)

and sanctions, including proliferation

financing. This combined approach allows

us to identify and manage relevant

synergies and connections between these

risks.

Anti-Bribery & Corruption

Bribery and corruption constitutes of:

a. improperly obtaining or retaining

business; and/or

b. improperly securing a business or

personal advantage; and/or

c. inducing another person to perform

their role in breach of an expectation of

good faith, impartiality or trust.

Barclays and its employees are prohibited

from engaging in or facilitating any form of

bribery and corruption (giving and

receiving, directly or indirectly). The

Financial Crime Policy contains the

minimum risk-based control requirements

that all our businesses, legal entities and

employees must follow. The Financial

Crime Policy is designed to ensure that

Barclays’ employees know how to identify

and manage the legal, regulatory and

reputational risks associated with all forms

of bribery and corruption.

Anti-Money Laundering

Money laundering has been identified as

major threats to the international financial

services community and therefore to

Barclays. The Barclays Financial Crime

Policy includes the requirement for

Barclays businesses and legal entities to

have adequate systems, procedures, and

controls in place to manage the risk of

Barclays being used to facilitate money

laundering. The requirements of UK

legislation apply to Barclays globally. As a

transatlantic bank, the Financial Crime

Policy also takes into account EU and US

anti-money laundering requirements, as

well as guidance issued by bodies such as

the Wolfsberg Group and the European

Banking Authority.

Anti-Tax Evasion Facilitation

Tax evasion is a financial crime and a

predicate offence to money laundering in

the UK and many other countries in which

we operate. Barclays takes a zero-

tolerance approach to deliberate

facilitation of tax evasion in any country

and has procedures in place to prevent it.

We also expect the same from our

employees and third parties providing

services for or on our behalf. Barclays is

committed to:

a. dealing only with customers who have

appropriately declared their assets to

the relevant tax authorities; and

b. preventing tax evasion facilitation by our

employees or third parties acting for or

on our behalf.

Sanctions

Sanctions are restrictions on activity with

targeted countries, regions, governments,

entities, individuals and industries that are

imposed by bodies such as the European

Union, the United Nations, groups of

countries, or individual countries, such as

the United Kingdom and the United States.

In order to protect its reputation and other

legitimate business interests, in certain

circumstances Barclays sanctions risk

appetite may be stricter than its legal

obligations.

The Financial Crime Policy is designed to

ensure that Barclays and its employees

know how to identify and manage the risks

associated with sanctions, including the

risk that activity is undertaken through

Barclays in breach of sanctions regulations.

|  |  |
| --- | --- |
|  |  |
| + | For further details of the Barclays approach to  Financial Crime compliance and prevention, please  see our  Financial Crime Compliance Statement in the  ESG Resource Hub at [home.barclays/esg-resource-](https://home.barclays/esg-resource-hub/reporting-and-disclosures/)  [hub/reporting-and-disclosures/](https://home.barclays/esg-resource-hub/reporting-and-disclosures/) |
|  |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 249 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

#### Health and Safety

Barclays has a comprehensive Health and

Safety Management System operating

globally, which is independently certified to

the international standard ISO45001 in the

USA, UK, India, Singapore, Hong Kong and

Japan.

Barclays has a suite of Health and Safety

(H&S) policies and standards that combine

together under a single high-level

statement of commitment endorsed by

the Group ExCo. H&S policies are owned

by three risk Horizontals – Premises,

People and Physical Security. Each

Horizontal manages specific hazards

through the Group policies and standards,

with quantitative targets set through key

indicators (KIs) and control environment

characteristics (CECs). A program of

internal control testing ensures that our

KIs and CECs continue to perform

satisfactorily, and that any opportunity for

improvement identified can be acted upon.

Performance is reported on at the Group

Health & Safety Forum which oversees

effective management of health and

safety across Barclays.

Barclays has in place global risk

assessments which identify the hazards

and control measures needed to reduce

risks to as low as reasonably practicable,

these are underpinned by local regulatory

requirements and procedures. The global

risk assessments are published on the H&S

intranet site.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Measure | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 |
| Number of High or Exceptional Accidents | 0 | 0 | 0 | 0 |
| Lost Time Incidents (per 100 employees) | 0.023 | 0.02 | 0.024 | 0.025 |
| % Completion Mandatory Training | 99.9% | 99.9% | 99.9% | 99.9% |

Barclays suppliers are subject to a supplier

risk evaluation during onboarding, a

minimum of annually thereafter and when

they notify of a change in service delivery.

In addition, they will complete an annual

control obligation review.

The Barclays H&S team, who operate

globally, provide support, competent

advice and assurance where required.

There is a programme of H&S assurance

and technical risk assessments to ensure

the hazard and risk controls remain

relevant and to identify emerging themes

and trends.

Onsite monitoring is undertaken across

our portfolio by the Barclays H&S team,

supported by the customer care leads for

retail sites or by our building facilities

management partners for corporate sites.

Working with the Chief Security Office

(CSO), there are processes and

procedures in place to cover terrorism,

disasters, fire and other emergency

evacuations. These are tested on a

programme schedule as required by the

risk assessment or local regulatory

requirements.

|  |
| --- |
|  |
|  |

Barclays has an incident reporting system

to ensure incidents are recorded and

investigated appropriately. Review of

incident data is completed by each region

to identify themes and trends, which are

then reviewed at the Group H&S Forum

and lessons learned shared. Incidents are

reported and escalated as required by local

regulatory statute and as per Barclays’ risk

framework for risk issues and events.

Information and knowledge is available

through our H&S safety intranet, which

provides key information on the hazard

register, risk assessments, training and

templates (for personal emergency

evacuation plans, Display Screen

Equipment (DSE) assessments, manual

handling, occupational stress

assessments, lone working assessments

etc).

Barclays operates a reward and

recognition scheme where colleagues are

recognised for improving our risk controls

and supporting our health and safety

management system.

The Health and Safety Risk Management Framework over view is as follows:

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Health and Safety Forum | | | | | | |
|  |  |  |  |  |  |  |
| Leadership | Statement of Commitment for Health and Safety | | | | |  |
|  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |
| H&S Data | Data: Performance against commitment | | | | |  |
|  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |
| Horizontal | Premises |  | People |  | Physical Security |  |
|  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |
| Risks | Harm to people through physical injury  (excluding injuries caused by Physical  Security related incidents) |  | Harm to people related to mental health  or mismanagement of employees  impacting personal welfare L.3 |  | Physical security incidents resulting in  harm to staff or external parties L3 |  |
|  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |
| Policies | Health and Safety  (Premises & Infrastructure) Policy |  | People Risk  Health & Wellbeing Policy |  | Group Physical Security Policy |  |
|  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |
| Standards | Health and Safety  (Premises & Infrastructure) Standard |  | People Risk  Health & Wellbeing Standard |  | Group Physical Security Standard |  |
|  |  |  |  |  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 250 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

Managing data privacy,

#### security and resilience

#### We have strict policies to protect privacy and keep data secure.

Data privacy

Most of the jurisdictions in which Barclays

operates have privacy and data protection

laws in effect. While these may vary in

detail, generally they reflect internationally

recognised privacy principles found in the

UN’s Universal Declaration of Human

Rights, the European Convention on

Human Rights and the European Union’s

Charter of Fundamental Rights.

We strive to operate in accordance with

these standards and recognise that

respect for privacy rights is a key element

of good corporate governance and social

responsibility. We strive to be transparent

about our use of personal information

when delivering our products and services

and acknowledge the responsibility we

have for safeguarding privacy.

As Barclays increasingly adopts digital

solutions to deliver next-generation

consumer financial services, we appreciate

our clients, customers and others may

wish to understand how this may impact

the use of their personal information. A

globally applicable Barclays Data Privacy

Standard sets out what is expected of all

Barclays businesses and functions when

collecting, using and sharing personal

information.

To promote clear accountability, the

Standard includes the requirement for

each business to appoint an accountable

executive who has ultimate responsibility

for the processing of personal data within

that business. An agreed assurance

programme measures compliance with

the Data Privacy Standard. Barclays

colleagues must complete annual privacy

training which is reviewed and refreshed

each year, with additional tailored training

provided as necessary. The Group Data

Protection Officer (DPO) reports on data

privacy issues to the highest level of

management.

Through customer and employee privacy

notices, we endeavour to explain clearly

and openly how and why we use personal

information and the legal grounds we rely

on. When we receive complaints we seek

to address them fairly. Several jurisdictions

also provide individuals with specific rights,

such as the right to have access to or

request deletion of their personal

information.

Barclays provides a public mailbox and

secure channels via its website to enable

individuals to make their privacy requests

and receive responses from a dedicated

team.

Barclays requires its suppliers to comply

with data protection and privacy laws,

regulations and standards relevant to the

jurisdictions in which they operate and

relevant to any transferred personal data.

Our requirements are set out and

managed through the Barclays Supplier

Control Obligations, available online, which

look to provide assurance that all new and

existing suppliers commit to ensuring

personal data shared with them is

safeguarded and respected throughout

the supply chain.

Data security

Barclays deploys automated controls to

protect its sensitive information and the

data that has been entrusted to us by

customers and clients, in line with our

standards, taking into account findings

from internal and external reviews of our

controls. As Barclays accelerates the

migration of digital services to the cloud,

we apply the same design principles that

underpin our existing control environment.

We have controls and monitoring in place

designed to secure cloud-hosted data and

maintain its integrity.

Barclays seeks to protect the security of

data we share with third parties, including

by conducting remote and on-site

inspections with certain suppliers to review

their controls against contractual

obligations and industry standards. A Third

Party Service Provider Framework is in

place which sets out control requirements

for business units to manage the

operational, reputational, conduct and

legal risks to Barclays through its supply

chain.

As we have transitioned to a more hybrid

working model, we have educated

colleagues on cybersecurity risks in order

to help minimise the risk of data

exploitation or leakage.

Data resilience

Barclays' CSO operates key controls that

mitigate cybersecurity-related risks. CSO

focuses on understanding internal and

external threats and delivering on our

capabilities to counteract them.

As part of our efforts to continuously

review and improve our response and

recovery plans in preparation for evolving

threats, Barclays works with industry

bodies to learn from risk events in other

organisations. Our teams use intelligence

to create plausible cybersecurity and data

compromise scenarios which we simulate

to help us focus on continuous

improvement.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 251 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

Operational resilience

Customers and clients have increased

expectations for us to be ‘Always On’, and

the interconnectivity of the financial sector

means the stability and resilience of our

systems, workforce and the continued

provision of third-party services, all of

which have a direct impact on the quality of

our service.

Resilience and Security is a focus for the

board. Barclays continues to invest in a

multi-year resilience programme which is

focused on our ability to recover from

‘severe but plausible’ scenarios which

could cause detriment to our customers

and clients and the broader financial

market. To enable this, we define Group-

wide business services and their

interdependencies across the Group,

including technology, third-party services

and our workforce, and develop the

recovery plans and business response

plans for disruption events, such as cyber

or data integrity disruptions. We review

and validate these recovery plans through

regular testing which supports our aim to

reduce the volume and impact of

operational incidents year on year. We also

conduct regular assurance on third parties

to assess their capability, as defined by our

contractual Information & Cyber Security

Supplier Control Obligations.

Resilience and security is the responsibility

of everyone within the Group. All

permanent employees are required to

complete mandatory training on these

topics at regular intervals across the year.

|  |  |
| --- | --- |
|  |  |
| + | Please refer to pages [178](#i823b684a5d6442708dc36f3751a22518_6-0-1-1-1841111) for details of Barclays PLC  Board Risk Committee oversight relating to  operational resilience.  Please refer to the 'Material existing and emerging  risks' section in our Risk review on pages [266](#ieb8684554fcd4b19ba286a4483dc6ad6_42146) to [267](#ieb8684554fcd4b19ba286a4483dc6ad6_42147)  for further details on cyberattacks, data  management and information protection.  Please refer to the 'Supervision and regulation'  section in our Risk review on pages [370](#i7d14e033e5b94859948b1dda818e15c5_655630) for further  details on our regulatory approach to managing such  risks. |
|  |

Chief Security Office

Barclays' CSO exists to keep the bank, its

customers, clients, and colleagues safe

and secure, and to maintain the resilience

of our operations. CSO supports Barclays'

business to operate in a protected and

secure environment, and actively

promotes the culture that security is

everyone's responsibility.

The Chief Security Officer for the Group

heads Barclays' CSO and reports up

through the Chief Operating Officer, who

sits on the Group Executive Committee.

The Group CISO reports directly to the

Chief Security Officer and is supported by

a team of CISOs for individual business

units and jurisdictions, as well as other

teams of cybersecurity experts and

analysts. Barclays' Group Chief Security

Officer combines 10 years of law

enforcement experience with over 20

years of experience serving in senior

leadership roles managing security at

global financial institutions. The Group

CISO and supporting leadership team

collectively have advanced degrees and

senior level experience managing security

risks in a variety of sectors, including those

that represent critical national

infrastructure, such as

telecommunications and peer financial

institutions. They are supported by

analysts and subject matter experts in a

variety of specialisations, such as

intelligence, penetration testing,

cyberforensic investigations, security

engineering, and vulnerability

management.

CSO leadership manages Barclays’

cybersecurity activities and is accountable

for the day-to-day monitoring of residual

risk, identification of gaps, oversight of

remedial actions and implementation of

strategy. As described below, the Chief

Security Officer and CISO for the Group

provide updates to the Board and Board

Risk Committee about cybersecurity risks

facing the Group.

Within its oversight of Operational risk as a

Principal Risk, the Board Risk Committee is

responsible for oversight of risks arising

from cybersecurity threats. As part of this

oversight, the Board Risk Committee

receives periodic updates from Barclays'

Chief Security Officer or CISO for the

Group on cybersecurity matters. In 2023,

such updates addressed topics that

included the shifting cybersecurity threat

landscape, measurement of Barclays' risk

and control posture, cybersecurity incident

trends and Barclays' response, Barclays'

ability to recover from a material

cyberattack scenario, third party control

and assurance monitoring, privileged

access to Barclays' systems, regulatory

developments, and Barclays' technology

and resource investment strategy.

Barclays assesses its cybersecurity

activities against the industry-recognised

National Institute of Standards and

Technology (NIST) security maturity

framework, and we periodically engage

external security consultants to conduct

independent benchmarking assessments.

In 2023, findings from such an assessment

conducted in late 2022 were briefed to the

Board and Board Risk Committee.

Barclays' CSO partners with third-party

security providers throughout the Group's

cybersecurity activities, including for cyber

recovery, penetration testing, software

vulnerability scanning, distributed denial of

service (DDoS) attack prevention, phishing

simulations, third-party risk management,

incident response, intelligence, fraud

prevention, and industry benchmarking.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 252 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

Under Barclays' Enterprise Risk

Management Framework, there is an

Information and Cyber Security Policy

supported by ten Standards which define

the minimum requirements for

cybersecurity matters across the entire

Barclays Group. These Standards cover

the following topics: Cryptography,

Network Security, Security Configuration,

Data Loss Prevention, Vulnerability

Management, Data Security, Incident

Response & Threat Intelligence, Threat

Management, Governance, and Identity &

Access Management.

An important part of Barclays’

cybersecurity environment is its Joint

Operations Centres (JOCs), which operate

24x7x365 from three globally strategic

locations, linking CSO’s security

professionals and incident response

managers with control functions and

business unit representatives. The JOCs

deliver security responsiveness by uniting

core security functions and providing a

central information and coordination point

for security incident management.

To manage security risk related to our

third-party suppliers, many of which

perform critical services for Barclays and

handle sensitive Barclays data, we have a

set of contractual Information & Cyber

Security Supplier Control Obligations that

are based off of the requirements of our

internal standards. We conduct assurance

over our third and fourth parties against

those obligations through a dedicated

External Cyber Assurance & Monitoring

team (ECAM) and a set of control

indicators.

This is achieved through our own

assurance capabilities and use of a third

party assurance utility. Activity is

structured on a risk-based approach that

prioritises suppliers that underpin our most

important business services.

Identified issues are managed formally, but

we also engage proactively with third-party

suppliers to help them strengthen their

security and resilience posture. To

recognise the changing risk presented by

third-party suppliers, which are

increasingly targeted by threat actors, we

regularly alert third-party suppliers where

we anticipate that they may be more

vulnerable and should take preventative

action.

Notwithstanding such third-party risk

management efforts, Barclays does not

have direct control over the cybersecurity

of the systems of its third parties, limiting

the Group’s ability to effectively protect

and defend against certain threats.

Certifications

Barclays holds three ISO27001

certifications (i.e., the international

standard on how to manage information

security), Cyber Essentials / Cyber

Essentials Plus Certification, and has a UK

certification for Digital Banking.

Reporting phishing

CSO performs a number of key activities

related to identifying, investigating,

responding to and containing phishing /

malicious email incidents. CSO has

embedded an operational process that

provides education and awareness

content via email to colleagues who click a

malicious link or attachment in a phishing

email, with escalating training exercises

and management interventions for

repeated instances. To report suspected

phishing to Barclays' JOC for further

investigation, colleagues have a tool

integrated into their email account, and

colleagues receive feedback on whether

the reported email was suspect or

genuine. CSO also runs monthly phishing

simulations to understand colleagues'

susceptibility to real attacks, using the

analysis to refine education and training.

Training

Barclays has adopted a 65-day window for

mandatory training completion to allow

colleagues sufficient time to complete

training. The consequence of non-

completion is a breach which can lead to

disciplinary action and impact

compensation.

The 65-day window covers many different

colleague situations, including new joiners,

returners from sick leave or parental leave

and internal movers. Some of these

situations are required by law to have a

reasonable adjustment time to enable the

successful completion of training. This

process is managed by Barclays HR and

Compliance.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report |  |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 253 |
|  | Governance |  |
|  |  |  |  |  |  |  |  |  |  |  |
| ESG Governance (continued) | | | | | | | | | | |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  | Risk review | |  |  |  |
|  | The management of risk is a critical underpinning to  the execution of Barclays’ strategy. The material risks  and uncertainties the Group faces across its  business and portfolios are key areas of  management focus. | |  |  |  |
|  |  | | |  |  |
|  |  |  |  |  |  |
|  |  |  | Page | Pillar 3  Report |  |
|  | Risk management strategy  Overview of Barclays’ approach to risk  management. A detailed overview  together with more specific information  on policies that the Group determines  to be of particular significance in the  current operating environment can be  found in the Barclays PLC Pillar 3 Report  2023 or at barclays.com | [Enterprise Risk Management](#i4be61753b7f243b19551b0bfbf3a2a0d_592) Framework (ERMF) | [256](#i4be61753b7f243b19551b0bfbf3a2a0d_592) | 106 |  |
|  | [Segregation of duties – the ‘Three Lines](#i4be61753b7f243b19551b0bfbf3a2a0d_595)  [of Defence’ model](#i4be61753b7f243b19551b0bfbf3a2a0d_595) | [256](#i4be61753b7f243b19551b0bfbf3a2a0d_595) | 106 |  |
|  | [Principal risks](#i4be61753b7f243b19551b0bfbf3a2a0d_607) | [257](#i4be61753b7f243b19551b0bfbf3a2a0d_598) | 106 |  |
|  | [Risk appetite](#i4be61753b7f243b19551b0bfbf3a2a0d_610) | [257](#i4be61753b7f243b19551b0bfbf3a2a0d_601) | 107 |  |
|  | [Risk committees](#i4be61753b7f243b19551b0bfbf3a2a0d_613) | [257](#i4be61753b7f243b19551b0bfbf3a2a0d_604) | 109 |  |
|  | [Barclays’ risk culture](#i4be61753b7f243b19551b0bfbf3a2a0d_616) | [257](#i4be61753b7f243b19551b0bfbf3a2a0d_607) | 111 |  |
|  | Material existing and emerging risks  Insight into the level of risk across our  business and portfolios, the material  existing and emerging risks and  uncertainties we face and the key areas  of management focus. | [Material existing and emerging risks potentially](#i4be61753b7f243b19551b0bfbf3a2a0d_622)  [impacting more than one principal risk](#i4be61753b7f243b19551b0bfbf3a2a0d_622) | [258](#i4be61753b7f243b19551b0bfbf3a2a0d_613) | N/A |  |
|  | Climate risk | [262](#i4be61753b7f243b19551b0bfbf3a2a0d_616) | N/A |  |
|  | [Credit risk](#i4be61753b7f243b19551b0bfbf3a2a0d_619) | [263](#i4be61753b7f243b19551b0bfbf3a2a0d_619) | N/A |  |
|  | [Market risk](#i4be61753b7f243b19551b0bfbf3a2a0d_622) | [265](#i4be61753b7f243b19551b0bfbf3a2a0d_622) | N/A |  |
|  |  | [Treasury and Capital risk](#i4be61753b7f243b19551b0bfbf3a2a0d_625) | [265](#i4be61753b7f243b19551b0bfbf3a2a0d_625) | N/A |  |
|  |  | [Liquidity risk](#i4be61753b7f243b19551b0bfbf3a2a0d_628) | [265](#i4be61753b7f243b19551b0bfbf3a2a0d_628) | N/A |  |
|  |  | [Capital risk](#i4be61753b7f243b19551b0bfbf3a2a0d_631) | [265](#i4be61753b7f243b19551b0bfbf3a2a0d_631) | N/A |  |
|  |  | Interest rate risk in the banking book (IRRBB) | [266](#i4be61753b7f243b19551b0bfbf3a2a0d_634) | N/A |  |
|  |  | [Operational risk](#i4be61753b7f243b19551b0bfbf3a2a0d_637) | [266](#i4be61753b7f243b19551b0bfbf3a2a0d_637) | N/A |  |
|  |  | [Tax risk](#i4be61753b7f243b19551b0bfbf3a2a0d_640) | [268](#i4be61753b7f243b19551b0bfbf3a2a0d_640) | N/A |  |
|  |  | [Model risk](#i4be61753b7f243b19551b0bfbf3a2a0d_643) | [269](#i4be61753b7f243b19551b0bfbf3a2a0d_643) | N/A |  |
|  |  | Compliance [risk](#i4be61753b7f243b19551b0bfbf3a2a0d_790) | [269](#i4be61753b7f243b19551b0bfbf3a2a0d_646) | N/A |  |
|  |  | [Legal risk](#i4be61753b7f243b19551b0bfbf3a2a0d_652) | [270](#i4be61753b7f243b19551b0bfbf3a2a0d_652) | N/A |  |
|  |  |  |  |  |  |

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| --- | --- | --- | --- | --- | --- |
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|  |  |  |  |  |  |
|  |  |  | Page | Pillar 3  Report |  |
|  | Principal risk management  Barclays’ approach to risk management  for each principal risk with focus on  organisation and structure and roles  and responsibilities. | Climate risk management | [272](#i4be61753b7f243b19551b0bfbf3a2a0d_655) | 116 |  |
|  | [Credit risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_664) | [276](#i4be61753b7f243b19551b0bfbf3a2a0d_664) | 119 |  |
|  | [Market risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_667) | [278](#i9950dfc0c56d43d0bc1580e340540c9e_4221) | 153 |  |
|  | [Treasury and capital risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_673) | [278](#i4be61753b7f243b19551b0bfbf3a2a0d_673) | 171 |  |
|  |  | [Model risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_676) | [280](#i4be61753b7f243b19551b0bfbf3a2a0d_676) | 184 |  |
|  |  | [Operational risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_679) | [280](#i4be61753b7f243b19551b0bfbf3a2a0d_679) | 180 |  |
|  |  | [Compliance risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_682) | [281](#i4be61753b7f243b19551b0bfbf3a2a0d_682) | 187 |  |
|  |  | [Reputation risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_688) | [282](#i4be61753b7f243b19551b0bfbf3a2a0d_688) | 189 |  |
|  |  | [Legal risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_691) | [283](#i4be61753b7f243b19551b0bfbf3a2a0d_691) | 191 |  |
|  | Climate risk performance | [Carbon-related assets](#i4be61753b7f243b19551b0bfbf3a2a0d_697) | [284](#i4be61753b7f243b19551b0bfbf3a2a0d_697) | N/A |  |
|  |  | [Elevated risk sectors](#i4be61753b7f243b19551b0bfbf3a2a0d_697) | [284](#i4be61753b7f243b19551b0bfbf3a2a0d_697) | N/A |  |
|  |  | [Financing (capital markets)](#i4be61753b7f243b19551b0bfbf3a2a0d_700) | [287](#i4be61753b7f243b19551b0bfbf3a2a0d_700) | N/A |  |
|  | Credit risk performance | Credit risk | [291](#i4be61753b7f243b19551b0bfbf3a2a0d_706) | N/A |  |
|  |  | [Maximum exposure and effects of netting,](#i4be61753b7f243b19551b0bfbf3a2a0d_709)  [collateral and risk transfer](#i4be61753b7f243b19551b0bfbf3a2a0d_709) | [293](#i4be61753b7f243b19551b0bfbf3a2a0d_709) | N/A |  |
|  |  | [Expected Credit Losses](#i4be61753b7f243b19551b0bfbf3a2a0d_712) | [295](#i4be61753b7f243b19551b0bfbf3a2a0d_712) | N/A |  |
|  |  | [Movement in gross exposures and impairment](#i4be61753b7f243b19551b0bfbf3a2a0d_715)  [allowance including provisions for loan commitments](#i4be61753b7f243b19551b0bfbf3a2a0d_715)  [and financial guarantees](#i4be61753b7f243b19551b0bfbf3a2a0d_715) | [298](#i4be61753b7f243b19551b0bfbf3a2a0d_715) | N/A |  |
|  |  | [Management adjustments to models](#i4be61753b7f243b19551b0bfbf3a2a0d_718)  [for impairment (audited)](#i4be61753b7f243b19551b0bfbf3a2a0d_718) | [307](#i4be61753b7f243b19551b0bfbf3a2a0d_718) | N/A |  |
|  |  | [Measurement uncertainty and sensitivity analysis](#i4be61753b7f243b19551b0bfbf3a2a0d_721) | [311](#i4be61753b7f243b19551b0bfbf3a2a0d_721) | N/A |  |
|  |  | [Analysis of the concentration of credit risk](#i4be61753b7f243b19551b0bfbf3a2a0d_724) | [320](#i4be61753b7f243b19551b0bfbf3a2a0d_724) | N/A |  |
|  |  | [The approach to management](#i4be61753b7f243b19551b0bfbf3a2a0d_727)  [and representation of credit quality](#i4be61753b7f243b19551b0bfbf3a2a0d_727) | [322](#i4be61753b7f243b19551b0bfbf3a2a0d_727) | N/A |  |
|  |  | [Analysis of specific portfolios and asset types](#i4be61753b7f243b19551b0bfbf3a2a0d_730) | [329](#i4be61753b7f243b19551b0bfbf3a2a0d_730) | N/A |  |
|  |  | [Forbearance](#i4be61753b7f243b19551b0bfbf3a2a0d_736) | [332](#i4be61753b7f243b19551b0bfbf3a2a0d_736) | N/A |  |
|  | Market risk performance | [Market risk overview and summary of performance](#i4be61753b7f243b19551b0bfbf3a2a0d_739) | [336](#i4be61753b7f243b19551b0bfbf3a2a0d_739) | 92 |  |
|  | Treasury and capital risk performance | [Treasury and Capital risk](#i4be61753b7f243b19551b0bfbf3a2a0d_760) | [338](#i4be61753b7f243b19551b0bfbf3a2a0d_760) | N/A |  |
|  |  | [Capital risk overview and summary of performance](#i4be61753b7f243b19551b0bfbf3a2a0d_769) | [350](#i4be61753b7f243b19551b0bfbf3a2a0d_769) | N/A |  |
|  |  | [Interest rate risk in the banking book](#i4be61753b7f243b19551b0bfbf3a2a0d_775) | [357](#i4be61753b7f243b19551b0bfbf3a2a0d_775) | N/A |  |
|  | Operational risk performance | [Operational risk overview and summary](#i4be61753b7f243b19551b0bfbf3a2a0d_781)  [of performance](#i4be61753b7f243b19551b0bfbf3a2a0d_781) | [359](#i4be61753b7f243b19551b0bfbf3a2a0d_781) | 102 |  |
|  |  | [Operational risk profile](#i4be61753b7f243b19551b0bfbf3a2a0d_784) | [359](#i4be61753b7f243b19551b0bfbf3a2a0d_784) | 104 |  |
|  | Model risk performance | [Model risk overview](#i4be61753b7f243b19551b0bfbf3a2a0d_787) | [361](#i4be61753b7f243b19551b0bfbf3a2a0d_787) | N/A |  |
|  | Compliance risk performance | [Compliance risk overview](#i4be61753b7f243b19551b0bfbf3a2a0d_790) | [361](#i4be61753b7f243b19551b0bfbf3a2a0d_790) | N/A |  |
|  | Reputation risk performance | [Reputation risk overview](#i4be61753b7f243b19551b0bfbf3a2a0d_793) | [362](#ibc08c791052a425b954cd2044ef04b55_1902) | N/A |  |
|  | Legal risk performance | [Legal risk overview](#i4be61753b7f243b19551b0bfbf3a2a0d_796) | [362](#i4be61753b7f243b19551b0bfbf3a2a0d_796) | N/A |  |
|  | Supervision and regulation |  | [363](#i4be61753b7f243b19551b0bfbf3a2a0d_802) | N/A |  |
|  |  |  |  |  |  |

## Barclays’

## risk

## management strategy

#### This section introduces the Group’s approach to managing and identifying

#### risks, and for fostering a sound risk culture.

Enterprise Risk Management

Framework (ERMF)

The ERMF outlines the highest level

principles for risk management by setting

out standards, objectives and key

responsibilities of different groups of

employees of the Group.

It is approved by the Barclays PLC Board

on recommendation of the Group Board

Risk Committee and the Group Chief Risk

Officer.

The ERMF sets out:

▪ principal risks faced by the Group, which

guide the organisation of risk

management processes

▪ risk appetite requirements. This helps

define the level of risk we are willing to

undertake in our business

▪ risk management and segregation of

duties: The ERMF defines a Three Lines

of Defence model

▪ roles and responsibilities for key risk

management and governance: The

accountabilities of the Group CEO,

Group CRO and other senior managers,

as well as an overview of Barclays PLC

committees.

The ERMF is complemented by frameworks,

policies and standards which are mainly

aligned to individual principal risks:

▪ frameworks cover high level principles

guiding the management of principal

risks, and set out details of which policies

are needed, and high level governance

arrangements

▪ policies set out the control objectives

and  high level requirements to address

the key principles articulated in their

associated frameworks. Policies state

‘what’ those within scope are required to

do

▪ standards set out the detail of the

control requirements to ensure the

control objectives set by the policies are

met.

Segregation of duties – the ‘Three Lines

of Defence’ model

The ERMF sets out a clear lines of defence

model. All colleagues are responsible for

understanding and managing risks within

the context of their individual roles and

responsibilities, as set out below.

▪ The first line comprises all employees

engaged in the revenue-generating and

client-facing areas of the Group and all

associated support functions, including

Finance, Operations, Treasury and

Human Resources. The first line is

responsible for identifying and managing

the risks in which they are engaged,

operating within applicable limits, and

escalating risk events or issues as

appropriate. Employees in the first line

have primary responsibility for their risks

and their activities are subject to

oversight from the relevant parts of the

second and third lines.

▪ The second line is comprised of the Risk

and Compliance functions. The role of

the second line is to establish the limits,

rules and constraints, and the

frameworks, policies and standards

under which all activities shall be

performed, consistent with the risk

appetite of the Group, and to oversee

the performance of the Group against

these limits, rules and constraints.

Controls for first line activities will

ordinarily be established by the control

officers operating within the control

framework of the firm. These will remain

subject to oversight by the second line.

▪ The third line of defence is Internal

Audit, who are responsible for providing

independent assurance over the

effectiveness of governance, risk

management and controls over current,

systemic and evolving risks.

▪ The Legal function provides support to

all areas of the bank and is not formally

part of any of the three lines of defence,

The Legal function is responsible for

proactively identifying, communicating

and providing legal advice on applicable

laws, rules and regulations. Except in

relation to the legal advice it provides or

procures, it is subject to second line

oversight with respect to its own

operational and compliance risks, as well

as with respect to the legal risk to which

the bank is exposed.

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|  | Board Committees |  | Annual Report arrows_Risk management.png | | Barclays PLC Board | | | | |  |
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|  |  |  | Barclays PLC Board  Risk Committee |  | Barclays PLC Board  Audit Committee |  | Barclays PLC Board  Remuneration  Committee |  |
|  |  |  |  |  |  |  |  |  |
|  | Management Level  Committees/Forums |  | Barclays Group  ExCo |  | Group Risk Committee | | |  | Group  Remuneration  Review Panel |  |
|  |  |  |  |  |  | | |  |  |  |
|  | Business Level  Committees/Forums |  |  |  | Barclays Risk Committees  (aligned to product/risk type or business) | | |  |  |  |
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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 256 |
|  |  |
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| Risk management | | | | | | | | | | |

Principal risks

The ERMF identifies nine principal risks

namely: credit risk, market risk, treasury

and capital risk, climate risk, operational

risk, model risk, compliance risk, reputation

risk and legal risk. Note that "compliance

risk" replaced "conduct risk" in 2023 with

an expanded definition. See page [269](#i4be61753b7f243b19551b0bfbf3a2a0d_646) for

more information.

Each of the principal risks is overseen by an

accountable executive within the Group

who is responsible for overseeing and/or

assigning responsibilities for the

framework, policies and standards that set

out associated responsibilities and

expectations and detail the related

requirements around risk management. In

addition, certain risks span across more

than one principal risk.

Risk appetite

Risk appetite is defined as the level of risk

which the Group is prepared to accept in

carrying out its activities. It provides a basis

for ongoing dialogue between

management and Board with respect to

the Group’s current and evolving risk

profile, allowing strategic and financial

decisions to be made on an informed

basis.

Risk appetite is approved by the Barclays

PLC Board in aggregate and disseminated

across legal entities and businesses,

supported by limits to enable and control

specific exposures and activities that have

material concentration risk implications.

Risk committees

Barclays various risk committees consider

risk matters relevant to their business, and

escalate as required to the Group Risk

Committee (GRC), whose Chair, in turn,

escalates to the  Barclays PLC Board Risk

Committees  and the Barclays PLC Board.

In addition to setting the risk appetite of

the Group, the Board is responsible for

approving the ERMF, and reviewing

reputation risk matters. It receives regular

information on the risk profile of the

Group, and has ultimate responsibility for

risk appetite and capital plans.

Further, there are two Board-level

committees which oversee the application

of the ERMF and implementation of key

aspects, the Barclays PLC Board Risk

Committee (BRC) and the Barclays PLC

Board Audit Committee (BAC).

Additionally, the Barclays PLC Board

Remuneration Committee oversee pay

practices focusing on aligning pay to

sustainable performance.

• The Barclays PLC Board Risk

Committee (BRC): the BRC monitors

the Group’s risk profile against the

agreed appetite. Where actual

performance differs from expectations,

the actions taken by management are

reviewed to ascertain that the BRC is

comfortable with them. The BRC also

reviews certain key risk methodologies,

the effectiveness of risk management,

and the Group’s risk profile, including the

material issues affecting each business

portfolio and forward risk trends. The

committee also commissions in-depth

analysis of significant risk topics, which

are presented by the Group CRO or

senior risk managers.

• The Barclays PLC Board Audit

Committee (BAC): the BAC receives

regular reports on the effectiveness of

internal control systems, quarterly

reports on material control issues of

significance, quarterly papers on

accounting judgements (including

impairment), and a quarterly review of

the adequacy of impairment allowances.

• The Barclays PLC Board Remuneration

Committee (RemCo): the RemCo

receives proposals on ex-ante and ex-

post risk adjustments to variable

remuneration based on risk

management performance including

events, issues and the wider risk profile.

These inputs are considered in the

setting of performance incentives.

The terms of reference and additional

details on membership and activities for

each of the principal Board committees

are available from the corporate

governance section of the Barclays

website at: [home.barclays/who-we-are/](https://home.barclays/who-we-are/our-governance/board-committees/)

[our-governance/board-committees/](https://home.barclays/who-we-are/our-governance/board-committees/)

The GRC is the most senior executive

body responsible for reviewing and

monitoring the risk profile of the Group.

This includes coverage of all principal risks,

and any other material risks, to which the

Group is exposed. The GRC reviews and

recommends the proposed risk appetite

and relative limits to the BRC. The

committee covers all business units and

legal entities of the Group and

incorporates specific coverage of Barclays

Bank Group.

Barclays’ risk culture

Risk culture can be defined as the norms,

attitudes and behaviours related to risk

awareness, risk taking and risk

management. This is reflected in how the

Group identifies, escalates and manages

risk matters.

Barclays is committed to maintaining a

robust risk culture in which:

• management expect, model and reward

the right behaviours from a risk and

control perspective

• colleagues identify, manage and

escalate risk and control matters, and

meet their responsibilities around risk

management.

The Group CEO works with the Executive

Management to embed a strong risk

culture within the firm, with particular

regard to the identification, escalation and

management of risk matters, in

accordance with the ERMF. This is

supported by our Purpose, Values and

Mindset, as well by as by setting a standard

of consistent excellence. Specifically, all

employees regardless of their positions,

functions or locations must play their part

in the Group’s risk management.

Employees are required to be familiar with

risk management policies which are

relevant to their responsibilities, know how

to escalate actual or potential risk issues,

and have a role-appropriate level of

awareness of the risk management

process as defined by the ERMF.

Our Code of Conduct – the Barclays Way

Globally, all colleagues must attest to the

‘Barclays Way’, our Code of Conduct, and

comply with all frameworks, policies and

standards applicable to their roles. The

Code of Conduct outlines the Purpose,

Values and Mindset which govern our

‘Barclays Way’ of working across our

business globally. It constitutes a

reference point covering all aspects of

colleagues’ working relationships, and

provides guidance on working with other

Barclays employees, customers and

clients, governments and regulators,

business partners, suppliers, competitors

and the broader community. See

[home.barclays/sustainability/esg-](https://home.barclays/sustainability/esg-resource-hub/statements-and-policy-positions/)

[resource-hub/statements-and-policy-](https://home.barclays/sustainability/esg-resource-hub/statements-and-policy-positions/)

[positions/](https://home.barclays/sustainability/esg-resource-hub/statements-and-policy-positions/) for more details.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 257 |
|  |  |
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| Risk management (continued) | | | | | | | | | | |

Material existing and emerging

risks to the Group’s future

performance

The Group has identified a broad range of

risks to which its businesses are exposed.

Material risks are those to which senior

management pay particular attention and

which could cause the delivery of the

Group’s strategy, results of operations,

financial condition and/or prospects to

differ materially from expectations.

Emerging risks are those which have

unknown components, the impact of

which could crystallise over a longer time

period. In addition, certain other factors

beyond the Group’s control, including

escalation of global conflicts, acts of

terrorism, natural disasters, pandemics

and similar events, although not detailed

below, could have a similar impact on the

Group.

Material existing and emerging

risks potentially impacting more

than one principal risk

i) Business  conditions , general economy

and geopolitical issues

The Group’s operations are subject to

changes in global and local economic and

market conditions, as well as geopolitical

developments, which may have a material

impact on the Group’s business, results of

operations, financial condition and

prospects.

A deterioration in global or local economic

and market conditions may result in

(among other things): (i) deteriorating

business, consumer or investor

confidence and lower levels of investment

and productivity growth, which in turn may

lead to lower customer and client activity,

including lower demand for borrowing; (ii)

higher default rates, delinquencies, write-

offs and impairment charges as borrowers

struggle with their debt commitments; (iii)

subdued asset prices, which may impact

the value of collateral held by the Group

and require the Group and its customers

to post additional collateral in order to

satisfy margin calls; (iv) mark-to-market

losses in trading portfolios resulting from

changes in factors such as credit ratings,

share prices and solvency of

counterparties; and (v) revisions to

calculated ECLs leading to increases in

impairment allowances. In addition, the

Group’s ability to borrow from other

financial institutions or raise funding from

external investors may be affected by

deteriorating economic conditions and

market disruption. Geopolitical events can

also cause financial instability and affect

economic growth.

In particular:

• Global GDP growth in 2023 was severely

hampered by inflationary pressures

resulting from: (i) restricted labour

markets, industrial disputes, and upward

pressure on employment costs; (ii) high

energy prices intensified by the conflicts

in Ukraine and the Middle East; and (iii)

resilient consumer spending, particularly

on services, funded by drawing

household savings. High inflation has led

to the on-going 'cost of living' pressures

in much of the world, including in the UK.

• In response to persistent inflation, 2023

saw central banks continue to tighten

monetary policy through raising interest

rates and exercising quantitative

tightening. While markets are

forecasting that rates are at or near their

cycle peak and inflation has begun to

ease back (albeit remaining well above

central banks' targets), economies in

which the Group operates are vulnerable

to recession risk in 2024. Such risk is

heightened by the turbulent geopolitical

outlook and volatile market conditions

with these factors acting as a drag on

potential global economic growth.

Higher mortgage rates, rising taxes,

elevated bond yields, depleted

household savings, higher corporate

insolvencies, and rising unemployment

have potentially negative implications

for the Group's performance, including

increased impairment allowances.

• The loss of ‘the presumption of

compliance’ is widely reported to have

raised costs for UK customers exporting

to the European Union (EU) which,

together with the risk of regulatory

divergence between the UK and the EU,

could adversely impact both the Group's

EU and UK operations.

• Further, any trading disruption between

the EU and the UK may have a significant

impact on economic activity in the EU

and the UK which, in turn, could have a

material adverse effect on the Group’s

business, results of operations, financial

condition and prospects.

• Unstable economic conditions could

result in (among other things):

– a deeper slowdown in the UK and/or

one or more member states of the EU

in which the Group operates, with

lower growth, higher unemployment

and a greater fall in property prices,

which could lead to increased

impairments in relation to a number of

the Group’s portfolios (including, but

not limited to, the UK mortgage

portfolio, unsecured lending portfolio

(including credit cards) and

commercial real estate exposures).

– increased market volatility (in

particular in currencies and interest

rates), which could impact the

Group’s trading book positions and

affect the underlying value of assets in

the banking book and securities held

by the Group for liquidity purposes. In

addition, depositor perceptions of

banking fragility as seen in certain

institutions in 2023 could increase the

severity and velocity of deposit

outflows, impacting the Group’s

liquidity position;

– a credit rating downgrade for one or

more members of the Group (either

directly or indirectly as a result of a

downgrade in the UK sovereign credit

ratings), which could significantly

increase the Group’s cost of funding

and/or reduce its access to funding,

widen credit spreads and have a

material adverse impact on the

Group’s interest margins and liquidity

position and/or

– a market-wide widening of credit

spreads or reduced investor appetite

for the Group’s debt securities, which

could negatively impact the Group’s

cost of and/or access to funding.

• A significant proportion of the Group’s

portfolio is located in the US, including a

major credit card portfolio and a range

of corporate and investment banking

exposures. Political instability and/or

increased polarisation ahead of the

2024 elections together with the

possibility of significant changes in US

policy in certain sectors may negatively

impact the Group’s associated

portfolios. Stress in the US economy,

weakening GDP and associated

exchange rate fluctuations, heightened

political and/or trade tensions (such as

between the US and China), and

increased unemployment could lead to

higher levels of impairment, which may

have a material adverse effect on the

Group's results of operations and

profitability.

• An escalation in geopolitical tensions or

increased use of protectionist measures

(such as the US and China implementing

reciprocal trade tariffs and/or outright

export bans on specific products and/or

in specific sectors) may have a material

adverse effect on the Group’s business

in the affected regions.

• In China, a significant global economy,

the property market slump, shrinking

exports, and weakened currency (and

resulting capital outflows) have caused

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 258 |
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| Material existing and emerging risks | | | | | | | | | | |

an economic slowdown, with deflation a

real risk. The high levels of debt,

particularly in the property sector,

remain a concern given the high

leverage multiples, despite government

and regulatory action. Any property

shock risks contaminating the financial

sector and precipitating a wider banking

crisis. A shift away from market-based

reforms towards state led initiatives to

stimulate the economy could damage

private-sector confidence and

economic growth.

• High US interest rates and a potential

global slow-down in demand for natural

resources, means an economic

deterioration in emerging markets still

remains a risk. This could have a material

adverse effect on the Group's results

from operations if these stresses lead to

higher impairment charges from a

deterioration in sovereign or corporate

creditworthiness.

• New strains of COVID-19 (or reduced

vaccine efficacy) could impact the

Group's ability to conduct business in

the jurisdictions in which it operates

through disruptions to: (i)) infrastructure

and supply chains, (ii) business

processes and technology services

provided by third parties and (iii), the

availability of staff due to illness. These

interruptions to business may be

detrimental to customers (who may

seek reimbursement from the Group for

costs and losses incurred as a result of

such interruptions), and result in

potential litigation costs (including

regulatory fines, penalties and other

sanctions), as well as reputational

damage. It may also have the effect of

increasing the likelihood and/or

magnitude of other risks described

herein (with consequential impairment

charge volatility) or may pose other risks

which are not presently known to the

Group or not currently expected to be

significant to the Group’s profitability,

capital and liquidity.

Any and all such events mentioned above

could have a material adverse effect on the

Group’s business, results of operations,

financial condition, prospects, liquidity,

capital position and credit ratings (including

potential credit rating agency changes of

outlooks or ratings), as well as on the

Group’s customers, employees and

suppliers.

ii) The impact of interest rate changes on

the Group’s profitability

Changes to interest rates are significant for

the Group, especially given the uncertainty

as to the size and frequency of such

changes, particularly in the Group’s main

markets of the UK, the US and the EU.

Interest rate rises result in higher funding

costs either due to higher refinancing

costs or due to deposit balance mix

changes as customers prefer higher rate

deposits. Interest rate rises however could

positively impact the Group’s profitability

as retail and corporate business net

interest income increases due to margin

decompression, as observed for the

interest rate rises in 2023. However,

increases in interest rates, if larger or more

frequent than expected, could lead to

generally weaker than expected growth,

reduced business confidence and higher

unemployment. This, combined with the

impact interest rate rises may have on the

affordability of loan arrangements for

borrowers (especially when combined with

inflationary pressures), could cause stress

in the lending portfolio and underwriting

activity of the Group. This could result in

higher credit losses driving increased

impairment charges which would most

notably impact retail unsecured portfolios

and wholesale non-investment grade

lending and could have a material effect on

the Group’s business, results of

operations, financial condition and

prospects.

Interest rate cuts may affect, and put

pressure on, the Group’s net interest

margins (the difference between its

lending income and borrowing costs) and

could adversely affect the profitability and

prospects of the Group.

In addition, changes in interest rates could

have an adverse impact on the value of the

securities held in the Group’s liquid asset

portfolio. Consequently, this could create

more volatility than expected through the

Group’s fair value through other

comprehensive income (FVOCI) reserve

and could adversely affect the profitability

and prospects of the Group.

iii) Competition in the banking and

financial services industry

The Group operates in a highly

competitive environment in which it must

evolve and adapt to significant changes as

a result of regulatory reform, technological

advances, increased public scrutiny,

prevailing market environment and

changes to economic conditions. The

Group expects that competition in the

financial services industry will continue to

be intense and may have a material

adverse effect on the Group’s future

business, results of operations, financial

condition and prospects.

New competitors in the financial services

industry continue to emerge.

Technological advances and the growth of

e-commerce have made it possible for

non-banks to offer products and services

that traditionally were banking products

such as electronic securities trading,

payments processing and online

automated algorithmic-based investment

advice. Furthermore, payments

processing and other services could be

significantly disrupted by technologies,

such as blockchain (used in cryptocurrency

systems) and 'buy now pay later' lending,

both of which are currently subject to

lower levels of regulatory oversight

compared to many activities undertaken

by banks. Furthermore, the introduction of

central bank digital currencies could have

significant impact on the banking system

and the role of commercial banks by

disrupting the current provision of banking

products and services. This disruption

could allow new competitors, some

previously hindered by banking regulation

(such as certain FinTechs), to provide

customers with access to banking facilities

and increase the disintermediation of

banking services.

New technologies and changing consumer

behaviour have previously required, and

could continue to require, the Group to

incur additional costs to modify or adapt its

products or make additional capital

investments in its businesses to attract

and retain clients and customers or to

match products and services offered by its

competitors, including technology

companies.

Ongoing or increased competition and/or

disintermediation of banking services may

put pressure on the pricing of the Group’s

products and services, which could reduce

the Group’s revenues and profitability, or

may cause the Group to lose market share,

particularly with respect to traditional

banking products such as deposits, bank

accounts and mortgage lending. This

competition may be on the basis of the

quality and variety of products and services

offered, transaction execution, innovation,

reputation and/or price. These factors

may be exacerbated by further industry

wide initiatives to address access to

banking. The failure of any of the Group’s

businesses to meet the expectations of

clients and customers, whether due to

general market conditions,

underperformance, a decision not to offer

a particular product or service, branch

closures, changes in client and customer

expectations or other factors, could affect

the Group’s ability to attract or retain

clients and customers. Any such impact

could, in turn, reduce the Group’s

revenues.

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| Material existing and emerging risks (continued) | | | | | | | | | | |

iv) Regulatory change agenda and impact

on business model

The Group’s businesses are subject to

ongoing regulation and associated

regulatory risks, including the effects of

changes in the laws, regulations, policies,

voluntary codes of practice and

interpretations of the foregoing in the UK,

the US, the EU and the other markets in

which it operates. Many regulatory

changes that are relevant to the Group’s

business may have an effect beyond the

country in which they are enacted, either

because the Group’s regulators

deliberately enact regulation with extra-

territorial effect or its global operations

mean that the Group gives effect to local

laws and regulations on a wider basis.

In recent years, regulators and

governments have focused on reforming

both the prudential regulation of the

financial services industry and the ways in

which the business of financial services is

conducted. Measures taken include

enhanced capital, liquidity and funding

requirements, the structural separation or

prohibition of certain activities by banks,

changes in the operation of capital

markets activities, the introduction of tax

levies and transaction taxes, changes in

compensation practices and more detailed

requirements on how business is

conducted and customers are treated.

The governments and regulators in the

UK, the US, the EU or elsewhere may

intervene further in relation to areas of

industry risk already identified, or in new

areas, which could adversely affect the

Group.

Current and anticipated areas of particular

focus for the Group’s regulators, where

regulatory changes could have a material

effect on the Group’s business, financial

condition, results of operations, prospects,

capital position, and reputation, include,

but are not limited to:

• the increasing focus by regulators,

international bodies, organisations and

unions on how institutions conduct

business, particularly with regard to the

delivery of fair outcomes for customers,

promoting effective competition in the

interests of consumers and ensuring the

orderly and transparent operation of

global financial markets, including the

new Consumer Duty in the UK and

measures resulting from ongoing

thematic reviews into the workings of

the retail, small and medium enterprises

and wholesale banking sectors and the

provision of financial advice to

consumers;

• the implementation of any conduct

measures as a result of regulators’ focus

on organisational culture, employee

behaviour and whistleblowing;

• the demise of certain benchmark

interest rates and the transition to new

risk-free reference rates (as discussed

further under ‘v) Impact of benchmark

interest rate reforms on the Group’

below);

• reviews of regulatory frameworks

applicable to the wholesale financial

markets, including reforms and other

changes to conduct of business, listing,

securitisation and derivatives related

requirements;

• the focus globally on technology

adoption and digital delivery, including

the use of artificial intelligence (AI),

digital assets and digital money

(including central bank digital

currencies), financial technology risks,

payments and related infrastructure,

operational resilience, and

cybersecurity. This also includes the

introduction of new and/or enhanced

regulatory standards in these areas,

underpinned by customer protection

principles;

• increasing regulatory expectations of

firms around governance and risk

management frameworks, particularly

for the management of climate change

and other ESG risks, enhanced ESG

disclosure and reporting obligations, and

proposals for a new regulatory

framework on diversity and inclusion in

the UK;

• the continued evolution of the UK’s

regulatory framework following the UK's

withdrawal from the EU, particularly

following the introduction of the

Financial Services and Markets Act 2023

(FSMA 2023) which provides for the

revocation of retained EU law relating to

financial services and the UK financial

services regulatory reform agenda

announced in December 2022, and

similarly regarding the access of UK and

other non-EU financial institutions to EU

markets;

• the implementation of the reforms to

the Basel III package, which includes

changes to the RWA approaches to

credit risk, market risk, counterparty risk,

operational risk, and credit valuation

adjustments and the application of RWA

floors and the leverage ratio;

• the implementation of more stringent

capital, liquidity and funding

requirements;

• the incorporation of climate change

within the global prudential framework,

including the transition risks resulting

from a shift to a low-carbon economy

and its financial effects;

• the increased regulatory focus in the UK

on the introduction of potential

measures designed to maximise access

to cash for consumers (including

retention of specific branches) and,

separately, regulatory scrutiny of the

reasons for refusing to open or

decisions to close customer bank

accounts;

• proposed reforms to the UK ring-

fencing regime, which requires the

separation of core banking operations

for retail and small and medium

enterprise depositors from other

wholesale and investment banking

operations;

• the reform of corporate criminal liability

in the Economic Crime and Corporate

Transparency Act 2023, which includes

a failure to prevent fraud offence;

• requirements to detail management

accountability within the Group (for

example, the requirements of the Senior

Managers and Certification Regime in

the UK and similar regimes elsewhere

that are either in effect or under

consideration/implementation), as well

as requirements relating to executive

remuneration;

• changes in national or supra-national

requirements regarding the ability to

offshore or outsource the provision of

services and resources or transfer

material risk or data to companies

located in other countries, which could

impact the Group’s ability to implement

globally consistent and efficient

operating models;

• financial crime, fraud and market abuse

standards and increasing expectations

for related control frameworks, to

ensure firms are adapting to new threats

and are protecting customers from

cyber-enabled crime and in the UK,

reforms relating to authorised push

payment fraud reimbursements;

• the application and enforcement of

economic sanctions including those with

extra-territorial effect and those arising

from geopolitical tensions;

• requirements flowing from

arrangements for the resolution

strategy of the Group and its individual

operating entities that may have

different effects in different countries;

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• the increasing regulatory expectations

and requirements relating to various

aspects of operational resilience,

including an increasing focus on the

response of institutions to operational

disruptions and reviews of the role of

critical third party providers;

• continuing regulatory focus on data

privacy, including the collection and use

of personal data, and protection against

loss and unauthorised or improper

access;

• the regulatory focus on policies and

procedures for identifying and managing

cybersecurity risks, cybersecurity

governance and the corresponding

disclosure and reporting obligations; and

• continuing regulatory focus on the

effectiveness of internal controls and

risk management frameworks, as

evidenced in regulatory fines and other

measures imposed on the Group and

other financial institutions.

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|  |

v) Impact of benchmark interest rate

reforms on the Group

Global regulators have driven international

efforts to reform benchmarks and indices,

used to determine the amounts payable

under a wide range of transactions to

increase reliability and robustness. These

reforms have resulted in significant

changes to the methodology and

operation of certain benchmarks and

indices, the adoption of alternative risk-

free reference rates (RFRs), the

discontinuation of certain benchmarks,

and the introduction of implementing

legislation and regulations. Specifically,

certain London Interbank Offered Rate

(LIBOR) tenors either ceased at the end of

2021 or became permanently

unrepresentative, with synthetic 3-month

GBP LIBOR ceasing to be published at the

end March 2024 and synthetic 1-, 3- and

6-month USD LIBOR settings intended to

cease being published at the end of

September 2024. Notwithstanding these

developments, given the unpredictable

consequences of benchmark reform, any

of these developments could have an

adverse impact on market participants,

including the Group, in respect of any

financial instruments linked to, or

referencing, any of these benchmarks.

Uncertainty associated with such potential

changes, including the availability and/or

suitability of alternative RFRs, the

participation of customers and third party

market participants in the transition

process, challenges with respect to

required documentation changes, and the

impact of legislation to deal with certain

legacy contracts that cannot convert into

or add fall-back RFRs before cessation of

the benchmark they reference, may

adversely affect a broad range of

transactions (including any securities,

loans and derivatives which use an

affected benchmark to determine an

amount payable which are included in the

Group’s financial assets and liabilities) that

use these benchmarks and indices, and

present a number of risks for the Group,

including but not limited to:

• Compliance risk: in undertaking actions

to transition away from using certain

benchmarks to new alternative RFRs,

the Group faces conduct risks. These

may lead to customer complaints,

regulatory sanctions or reputational

impact if the Group is considered to be

(among other things): (i) undertaking

market activities that are manipulative

or create a false or misleading

impression; (ii) misusing sensitive

information or not identifying or

appropriately managing and mitigating

conflicts of interest; (iii) providing

customers with inadequate advice,

misleading information, unsuitable

products or unacceptable service; (iv)

not taking a consistent approach to

remediation for customers in similar

circumstances; (v) unduly delaying the

communication and migration activities

in relation to client exposures, leaving

them insufficient time to prepare; or (vi)

colluding or inappropriately sharing

information with competitors.

• Litigation risk: members of the Group

may face legal proceedings, regulatory

investigations and/or other actions or

proceedings regarding (among other

things): (i) the conduct risks identified

above, (ii) the interpretation and

enforceability of provisions in contracts

and securities linked to a relevant

benchmark, and (iii) the Group’s

preparation and readiness for the

replacement of benchmarks which have

ceased or will shortly cease to be

published with alternative RFRs.

• Financial risk: the valuation of certain of

the Group’s financial assets and liabilities

may change. Moreover, transitioning to

alternative RFRs may impact the ability

of members of the Group to calculate

and model amounts receivable by them

on certain financial assets and determine

the amounts payable on certain financial

liabilities (such as debt securities issued

by them) because certain alternative

RFRs (such as the Sterling Overnight

Index Average (SONIA) and the Secured

Overnight Financing Rate (SOFR)) are

look-back rates, which means that the

amount of interest payable is only known

after the period has finished because it is

calculated by reference to observed

historical rates. In contrast, forward-

looking term rates (such as LIBOR) allow

borrowers to calculate at the start of any

interest period exactly how much is

payable at the end of such interest

period. This may have a material adverse

effect on the Group’s cash flows.

• Pricing risk: changes to existing

benchmarks and indices,

discontinuation of any benchmarks or

index and transition to alternative RFRs

may impact the pricing mechanisms

used by the Group on certain

transactions.

• Operational risk: changes to existing

benchmarks and indices, the

discontinuation of any benchmark or

index and transition to alternative RFRs

may require changes to the Group’s IT

systems, trade reporting infrastructure,

operational processes, and controls. In

addition, if any benchmark or index is no

longer available to calculate amounts

payable, the Group may incur expenses

in amending documentation for new and

existing transactions and/or effecting

the transition from the original

benchmark or index to a new one.

• Accounting risk: an inability to apply

hedge accounting in accordance with

IAS 39 could lead to increased volatility

in the Group’s financial results and

performance.

Any of these factors may have a material

adverse effect on the Group’s business,

results of operations, financial condition,

prospects and reputation.

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| Material existing and emerging risks (continued) | | | | | | | | | | |

vi) Change delivery and execution risks

The Group constantly adapts and

transforms the way it conducts business in

response to changing customer behaviour

and needs, technological developments,

regulatory expectations, increased

competition and cost management

initiatives. Accordingly, effective

management of transformation projects is

required to successfully deliver the

Group's strategic priorities, involving

delivering both on externally driven

programmes, as well as key business

initiatives to deliver revenue growth,

product enhancement and operational

efficiency outcomes. The magnitude,

complexity and, at times, concurrent

demands of the projects required to meet

these priorities can result in heightened

execution risk.

The ability to execute the Group’s strategy

may be limited by operational capacity and

the increasing complexity of the regulatory

environment in which the Group operates.

In addition, whilst the Group continues to

pursue cost management initiatives, they

may not be as effective as expected and

cost saving targets may not be met.

The failure to successfully deliver or

achieve any of the expected benefits of

these strategic initiatives and/or the failure

to meet customer and stakeholder

expectations could have a material

adverse effect on the Group’s business,

results of operations, financial condition,

customer outcomes, prospects and

reputation.

vii) Holding company structure of

Barclays PLC and its dependency on

distributions from its subsidiaries

Barclays PLC is a holding company and its

principal sources of income are, and are

expected to continue to be, distributions

(in the form of dividends and interest

payments) from operating subsidiaries

which also hold the principal assets of the

Group. As a separate legal entity, Barclays

PLC relies on such distributions in order to

be able to meet its obligations as they fall

due (including its payment obligations with

respect to its debt securities) and to

create distributable reserves for capital

distributions (such as dividends to ordinary

shareholders and share buybacks).

The ability of Barclays PLC’s subsidiaries to

pay dividends and interest and Barclays

PLC’s ability to receive such distributions

from its investments in its subsidiaries and

other entities will be subject not only to the

financial performance of such subsidiaries

and entities and prevailing macroeconomic

conditions but also to applicable local laws,

capital regulations (including internal MREL

requirements) and other restrictions

(including restrictions imposed by

governments and/or regulators, which

limit management’s flexibility in managing

the business and taking action in relation

to capital distributions and capital

allocation). These laws and restrictions

could limit the payment of dividends and

distributions to Barclays PLC by its

subsidiaries and any other entities in which

it holds an investment from time to time,

which could restrict Barclays PLC’s ability

to meet its obligations and/or to make

capital distributions (such as dividends to

ordinary shareholders and share

buybacks).

viii) Application of resolution measures

and stabilisation powers under the UK

Banking Act

Under the UK Banking Act 2009, as

amended (Banking Act), substantial

powers are granted to the Bank of England

(or, in certain circumstances, HM

Treasury), in consultation with the PRA, the

FCA and HM Treasury, as appropriate, as

part of the UK's special resolution regime

(SRR). These powers enable the relevant

UK resolution authority to implement

resolution measures and stabilisation

options with respect to a UK bank or

investment firm and certain of its affiliates

(currently including Barclays PLC) (each, a

relevant entity) in circumstances in which

the relevant UK resolution authority is

satisfied that the resolution conditions are

met.

The SRR consists of five stabilisation

options: (i) private sector transfer of all or

part of the business or shares of the

relevant entity; (ii) transfer of all or part of

the business of the relevant entity to a

‘bridge bank’ established by the Bank of

England; (iii) transfer to an asset

management vehicle wholly or partly

owned by the Bank of England; (iv) the

cancellation, transfer or dilution of the

relevant entities’ equity (including Barclays

PLC’s ordinary share capital) and write-

down or conversion of the relevant entity’s

capital instruments and liabilities (the bail-

in tool); and (v) temporary public ownership

(i.e. nationalisation).

In addition, the relevant UK resolution

authority may, in certain circumstances, in

accordance with the Banking Act require

the permanent write-down or conversion

into equity of any outstanding Tier 1 capital

instruments, Tier 2 capital instruments and

internal MREL prior to, or together with,

the exercise of any stabilisation option.

Any such action could result in the dilution,

transfer or cancellation of Barclays PLC’s

ordinary share capital, restrict Barclays

PLC’s ability to meet its obligations and/or

to pay dividends to ordinary shareholders.

Shareholders should assume that, in a

resolution situation, public financial

support will only be available to a relevant

entity as a last resort after the relevant UK

resolution authorities have assessed and

used, to the maximum extent practicable,

the resolution tools, including the bail-in

tool (the Bank of England’s preferred

approach for the resolution of the Group is

a bail-in strategy with a single point of

entry at Barclays PLC). The exercise of any

of such powers under the Banking Act or

any suggestion of any such exercise could

materially adversely affect the value of

Barclays PLC ordinary shares and could

lead to shareholders losing some or all of

their investment.

The ‘no creditor worse off’ safeguard

within the Banking Act requires that no

shareholder or creditor must be left worse

off from the use of resolution powers than

they would have been if the relevant entity

entered insolvent liquidation. Whilst

shareholders may be entitled to

compensation where there is determined

to have been a shortfall following a

valuation, there can be no assurance that

shareholders would recover any such

compensation promptly or that such

compensation will be equivalent to the full

losses incurred in resolution.

Material existing and emerging

risks impacting individual

principal risks

i) Climate risk

Climate risk is the impact on Financial

(Credit, Market, Treasury & Capital) and

Operational Risks arising from climate

change through physical risks and risks

associated with transitioning to a lower

carbon economy.

The effects of climate change may be

highly significant in their breadth and

magnitude and could affect a large number

of firms operating in different sectors and

geographies, leading to potential

downstream effects to the financial

system.

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| Material existing and emerging risks (continued) | | | | | | | | | | |

There is potential direct impact on banks

and other financial institutions through

their operations, as well as indirectly

through customers and clients. Given this

context and to support the Group’s

ambition to be a net zero bank by 2050,

Climate Risk is a Principal Risk under

Barclays’ ERMF.

Scientific research suggests that physical

risks arising due to climate change such as

acute events (e.g. cyclone, hurricanes and

floods) and chronic events (longer term

shifts in climate patterns) may occur in

increasing frequency and severity,

Potential tipping points can cause

unprecedented damage to particular

geographies. Some regions are expected

to be more severely affected than others if

they are more exposed and/or more

vulnerable to certain events.

The potential impact of physical risk

events on the economy may include lower

GDP growth, higher unemployment,

shortage of raw materials and products

due to supply chain disruptions and

significant changes in asset prices. These

factors could subsequently impact

business model and profitability of Barclays

and its clients. Damage to the properties

and operations of the Group's clients could

decrease their production capacity,

increase operating costs, affect insurability

and decrease value of those properties.

This in turn would lead to a decline in the

creditworthiness of clients, which may

result in higher defaults, delinquencies,

write-offs and impairment charges in the

Group's portfolios. Physical hazards may

also impact the creditworthiness of the

sovereigns of countries in which they

occur. The deterioration in the credit

ratings of sovereign bonds could affect

their access to capital and their eligibility

for inclusion in banks' liquidity buffers.

These hazards may also impact the value

of investments which the Group holds.

A transition to a low-carbon economy

requires policy and regulatory changes,

new national or regional commitments,

new technological innovations and

changes to supply and demand systems

within industries. The transition to a low-

carbon economy may also trigger changes

in consumer behaviour and market

sentiment. These changes may result in

increased costs and reduced demand for

the products and services of a company

including early retirement and impairment

of assets, or decreased revenue and

profitability.

The Group's clients that are more

susceptible and exposed to these changes

may face financial difficulties which in turn

may impact their creditworthiness. In

addition, impacts to the creditworthiness

of the Group's clients, customers and

counterparties (particularly in high carbon

sectors), can also arise a result of climate-

related legal actions or investigations,

where outcomes of such actions have

material financial impacts. This in turn can

increase credit risk within group portfolios

(for further details on credit risk, refer to ii)

Credit Risk on page [263](#i4be61753b7f243b19551b0bfbf3a2a0d_619)). Both transition

and physical risk drivers may lead to

increased price volatility and repricing of

market instruments, which in turn may

impact the value of market instruments

held by the Group.

The Group's own premises may also suffer

physical damage due to weather events

leading to increased costs for the Group.

As the economy transitions to a lower

carbon economy, financial institutions also

face significant and rapid developments in

stakeholder expectations, policy, law and

regulation, which could impact lending

activities and the risks associated with

lending portfolios as well as asset values.

Failure to adequately embed climate risk

management into the risk framework may

have a material and adverse impact on the

Barclays' brand, competitiveness,

profitability, capital requirements, cost of

funding, financial condition and ability to

expand its business.

In March 2020, the Group announced its

ambition to become a net zero bank by

2050 and its commitment to align all of its

financing activities with the goals and

timelines of the Paris Agreement. In order

to reach these ambitions and targets, and

any other climate-related ambitions or

targets the Group may commit to in

future, the Group will continue to

incorporate climate considerations into its

strategy, business model, the products

and services it provides to customers and

its financial and non-financial risk

management processes. These include

processes to measure and manage the

various financial and non-financial risks the

Group faces as a result of climate change.

The Group also needs to ensure that its

strategy and business model adapt to

changing national and international

standards, industry and scientific

practices, regulatory requirements and

market expectations regarding climate

change, which remain under continuous

development.

There remains a possibility that these

standards, practices, requirements and

expectations could change in a manner

that substantially increases the cost or

effort for the Group to achieve such

ambitions and targets. In addition, the

Group’s ambitions and targets may prove

more challenging to achieve due to

changing circumstances and external

factors which are beyond the Group’s

control, including geopolitical issues,

energy security, energy poverty and other

considerations such as a just transition to a

low-carbon economy. This may be

exacerbated if the Group chooses or is

required to accelerate its climate-related

ambitions or targets as a result of (among

other things) international regulatory

developments or stakeholder

expectations in the UK, the US, the EU or

other markets.

Achieving Barclays’ climate-related

ambitions and targets will also depend on a

number of factors outside the Group’s

control, including reliable forecasts of

hazards from the physical climate models

and availability of data/models to

measure/assess climate impact on clients.

The pathway to net zero is uncertain,

complex and dependent on progress in

various areas such as advances in low-

carbon technologies, collective action by

clients to meet their own net zero goals,

and supportive public policies in markets

where Barclays operates. If there is a lack

of progress in the aforementioned areas,

Barclays may fail to achieve its climate-

related ambitions and targets, and this

could have a material adverse effect on

Barclays’ business, operations, financial

condition, prospects and reputation.

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| --- | --- |
|  |  |
| + | For further details on the potential legal risk from  failing to achieve our climate-related ambitions and  targets, refer to [page](#i4be61753b7f243b19551b0bfbf3a2a0d_652) [270](#ieed9f272f3364f86baf2084fac980501_13925). |
|  |

ii) Credit risk

Credit risk is the risk of loss to the Group

from the failure of clients, customers  or

counterparties, including sovereigns, to

fully honour their obligations to members

of the Group, including the whole and

timely payment of principal, interest,

collateral, and other receivables. Credit risk

is impacted by a number of factors outside

the Group’s control, including wider

economic conditions.

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| Material existing and emerging risks (continued) | | | | | | | | | | |

a) Impairment

Impairment is calculated in line with the

requirements of IFRS9. Loss allowances,

based on ECLs, are measured on a

forward-looking basis using a broad range

of financial metrics and application of

complex judgements. Accordingly,

impairment charges are potentially volatile

and may not successfully predict actual

credit losses, particularly under stressed

conditions. Failure by the Group to

accurately estimate credit losses through

ECLs could have a material adverse effect

on the Group's business, results of

operations, financial condition, and

prospects.

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| --- | --- |
|  |  |
| + | For further details, refer to  [Note 8](#i4be61753b7f243b19551b0bfbf3a2a0d_934) . |
|  |

b) Specific portfolios, sectors and

concentrations

The Group is subject to risks arising from

changes in credit quality and recovery rates

for loans and advances due from borrowers

and counterparties. Additionally, the Group

is subject to a concentration of those risks

where it has significant exposures to

borrowers and counterparties in specific

sectors, or to particular types of borrowers

and counterparties. Any deterioration in

the credit quality of such borrowers and

counterparties could lead to lower

recoverability from loans and advances,

and higher impairment charges.

Accordingly, any of the following areas of

uncertainty could have a material adverse

impact on the Group's business, results of

operations,  financial condition, and

prospects:

• Consumer affordability:  this remains a

key area of focus, particularly in

unsecured lending, as cost of living

pressures persist. Macroeconomic

factors, such as unemployment, high

interest rates or broader inflationary

pressures, which impact a customer’s

ability to service debt payments, could

lead to increased arrears in both

unsecured and secured products.

• UK Retail, Hospitality and Leisure:

despite holding up reasonably well during

most of 2023, continuing cost of living

pressures, falling consumer confidence,

or other macroeconomic factors

adversely affecting consumers could

trigger a contraction in demand which,

together with rising business costs and,

for UK retail, a structural shift to online

shopping, would add pressure to sectors

heavily reliant on consumer discretionary

spending during 2024. This represents a

potential risk in the Group’s UK

corporate portfolio as a higher

probability of default exists for retailers,

hospitality providers and their landlords

while these pressures remain.

• Real Estate: UK property represents a

significant portion of the Group's overall

retail and corporate credit exposure, and

the Group remains at risk of increased

impairment from a material fall in

property prices. During 2023 rising

mortgage interest rates and increasing

economic concerns have reduced both

housing market activity and customer

borrowing capacity, resulting in modest

house price declines year on year. These

challenging market conditions are likely

to continue in 2024 as the effect of

higher interest rates continues to feed

through to disposable incomes,

especially in London and the South East

of the UK where the Group has a high

exposure. Additionally, as mortgages roll

off existing rates onto new higher rates,

there is a risk of increased borrower

defaults. This could put further

downward pressure on property prices

and, in turn, impact the Group’s

impairment and capital position.

Furthermore, certain segments of the

housing market could be subject to

specific valuation impacts (for example,

certain properties within the Group's

residential loan portfolio may be subject

to remediation activities relating to fire

safety standards). The Group’s

corporate exposure is conservatively

positioned with low LTVs but remains

vulnerable to a deteriorating economic

environment, and moderate stress has

been experienced in the Group's

(predominantly) US office commercial

real estate exposure during 2023. As

structural shifts in working patterns, such

as the normalisation of ‘hybrid’ working,

mature, the Group remains exposed to

further stress. Landlords serving

business tenants whose income is based

on discretionary consumer spending are

also at risk from reduced rent collection.

• Leveraged Finance Underwriting:the

Group takes on non-investment grade

underwriting exposures, including single

name risk, particularly in the US and the

UK. The subdued investor appetite in the

underwriting market during 2023

exposed the Group to extended

underwriting periods and negative

movements in marks, which could

deteriorate further and result in losses

for the Group (and higher capital

charges) if market conditions remain

challenging during 2024 and exposures

remain on book for further extended

periods.

• Oil & Gas sector: high market energy

prices during 2023 have helped restore

balance sheet strength to companies

operating in this sector. However, in the

longer term, costs associated with the

transition towards renewable sources of

energy may place greater financial

demands on oil and gas companies.

• Air Travel: the sector returned to profit in

2023 as lower margin (tourist) demand

for air travel recovered to pre-pandemic

levels. That said, there remains a

heightened risk to the revenue streams

of the Group’s clients and,

consequentially, their ability to service

debt obligation. These risks stem from

the structural decline in higher margin

business travel, consolidation within the

European airline market, reputational

damage and/or costs associated with

the emerging ‘fake parts’ scandal, volatile

oil prices, increasingly extreme weather

patterns and concerns about the impact

of air travel on climate change.

• Information Technology sector: while

dominated by well-known US firms,

many companies struggle to monetise

their product offerings and face

increasing reputational risk particularly as

regulatory scrutiny increases. Given the

nature of their activities, the Group’s

clients in this sector face heightened risk

from data security breaches and

ransomware and/or cyber attacks as well

as from the malicious use of Artificial

Intelligence, all of which could negatively

impact their ability to service debt

obligations.

The Group also has large individual

exposures to single name counterparties

(such as brokers, central clearing houses,

dealers, banks, mutual and hedge funds,

and other institutional clients) in both its

lending and trading activities, including

derivative trades. The default of one such

counterparty could cause contagion across

clients involved in similar activities and/or

adversely impact asset values should

margin calls necessitate rapid asset

disposals by that counterparty to raise

liquidity. In addition, where such

counterparty risk has been mitigated by

taking collateral, credit risk may remain high

if the collateral held cannot be monetised

or has to be liquidated at prices which are

insufficient to recover the full amount of

the loan or derivative exposure.

Any such defaults could have a material

adverse effect on the Group’s results due

to, for example, increased credit losses and

higher impairment charges.

Impact to the creditworthiness of the

Group's clients, customers and

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| Material existing and emerging risks (continued) | | | | | | | | | | |

counterparties (particularly in high carbon

sectors), can also arise out of climate-

related legal actions or investigations

commenced against the Group's clients,

customers and counterparties (particularly

in high carbon sectors), where outcomes

of such actions have material financial

impacts, which can in turn increase credit

risk within Group portfolios.

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| --- | --- |
|  |  |
| + | For further details on the Group’s approach to credit  risk, refer to the [credit risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_664)  and  [credit risk](#i4be61753b7f243b19551b0bfbf3a2a0d_706)  [performance](#i4be61753b7f243b19551b0bfbf3a2a0d_706)  sections. |
|  |

iii) Market risk

Market risk is the risk of loss arising from

potential adverse changes in the value of

the Group’s assets and liabilities from

fluctuation in market variables including,

but not limited to, interest rates,  foreign

exchange rates , equity prices, commodity

prices, credit spreads, implied volatilities

and asset correlations.

Economic and financial market

uncertainties remain elevated, driven by

elevated inflation and tightening monetary

policy, both of which are exacerbated by

geopolitical conflicts and idiosyncratic

market events. A disruptive adjustment to

higher or lower interest rate levels and

deteriorating trade and geopolitical

tensions could heighten market risks for

the Group’s portfolios.

In addition, the Group’s trading business

could be vulnerable were there to be

prolonged period of elevated asset price

volatility, particularly if it adversely affects

market liquidity. Such a scenario could

impact the Group’s ability to execute client

trades and may also result in lower client

flow-driven income and/or market-based

losses on its existing portfolio of assets.

These can include higher hedging costs

from rebalancing risks that need to be

managed dynamically as market levels and

their associated volatilities change.

Changes in market conditions could have a

material adverse effect on the Group’s

business, results of operations, financial

condition and prospects.

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| --- | --- |
|  |  |
| + | For further details on the Group’s approach to  market risk,  refer to the [market risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_667)  and  [market risk performance](#i4be61753b7f243b19551b0bfbf3a2a0d_739)  sections. |
|  |

iv) Treasury and capital risk

There are three primary types of treasury

and capital risk faced by the Group:

a) Liquidity risk

Liquidity risk is the risk that the Group is

unable to meet its contractual or

contingent obligations or that it does not

have the appropriate amount, tenor and

composition of funding and liquidity to

support its assets. This could cause the

Group to fail to meet regulatory and/or

internal liquidity requirements, make

repayments of principal or interest  as they

fall due or to support day-to-day business

activities. Key liquidity risks that the Group

faces include:

• Stability of the Group’s deposit funding

profile: deposits which are payable on

demand or at short notice could be

adversely affected by the Group failing

to preserve the current level of

customer and investor confidence or as

a result of competition in the banking

industry.

• Ongoing access to wholesale funding:

the Group regularly accesses the money

and capital markets to provide short-

term and long-term unsecured and

secured funding to support its

operations. A loss of counterparty

confidence, or adverse market

conditions (such as the recent rises in

interest rates) could lead to a reduction

in the tenor, or an increase in the costs,

of the Group’s unsecured and secured

wholesale funding or affect the Group’s

access to such funding.

• Impacts of market volatility: adverse

market conditions, with increased

volatility in asset prices could: (i)

negatively impact the Group’s liquidity

position through increased derivative

margin requirements and/or wider

haircuts when monetising liquidity pool

securities; and (ii) make it more difficult

for the Group to execute secured

financing transactions.

• Intraday liquidity usage: increased

collateral requirements for payments

and securities settlement systems could

negatively impact the Group’s liquidity

position, as cash and liquid assets

required for intraday purposes are

unavailable to meet other outflows.

• Off-balance sheet commitments:

deterioration in economic and market

conditions could cause customers to

draw on off-balance sheet

commitments provided to them, for

example revolving credit facilities,

negatively affecting the Group’s liquidity

position.

• Credit rating changes and impact on

funding costs: any reductions in a credit

rating (in particular, any downgrade

below investment grade) may affect the

Group’s access to money or capital

markets and/or the terms on which the

Group is able to obtain market funding

(for example, this could lead to

increased costs of funding and wider

credit spreads, the triggering of

additional collateral or other

requirements in derivative contracts and

other secured funding arrangements, or

limits on the range of counterparties

who are willing to enter into transactions

with the Group).

b) Capital risk

Capital risk is the risk that the Group has an

insufficient level or composition of capital

to support its normal business activities

and to meet its regulatory capital

requirements under normal operating

environments and stressed conditions

(both actual and as defined for internal

planning or regulatory stress testing

purposes). This also includes the risk from

the Group’s pension plans. Key capital risks

that the Group faces include:

• Failure to meet prudential capital

requirements: this could lead to the

Group being unable to support some or

all of its business activities, a failure to

pass regulatory stress tests, increased

cost of funding due to deterioration in

investor appetite or credit ratings and

restrictions on distributions (including in

respect of its shares and/or additional

tier 1 instruments), leading to an inability

to comply with the Group's distribution

policy and/or the need to take additional

measures to strengthen the Group’s

capital or leverage position.

• Adverse changes in FX rates impacting

capital ratios: the Group has capital

resources, risk weighted assets and

leverage exposures denominated in

foreign currencies. Changes in foreign

currency exchange rates may adversely

impact the sterling equivalent value of

these items. As a result, the Group’s

regulatory capital ratios are sensitive to

foreign currency movements. Failure to

appropriately manage the Group’s

balance sheet to take account of foreign

currency movements could result in an

adverse impact on the Group’s

regulatory capital and leverage ratios.

• Adverse movements in the pension

fund: adverse movements in pension

assets and liabilities for defined benefit

pension schemes could result in deficits

on a technical provision and/or IAS 19

accounting basis. This could lead to the

Group making substantial additional

contributions to its pension plans and/or

a deterioration in its capital position. The

market value of pension fund assets

might decline or investment returns

might reduce. Under IAS 19, the

liabilities discount rate is derived from

the yields of high-quality corporate

bonds. Therefore, the valuation of the

Group’s defined benefits schemes

would be adversely affected by a

prolonged fall in the discount rate due to

a persistent low interest rate and/or

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| Material existing and emerging risks (continued) | | | | | | | | | | |

credit spread environment. Inflation is

another significant risk driver to the

pension fund as the liabilities are

adversely impacted by an increase in

long-term inflation expectations.

c) Interest rate risk in the banking book

Interest rate risk in the banking book is the

risk that the Group is exposed to capital or

income volatility because of a mismatch

between the interest rate exposures of its

(non-traded) assets and liabilities. The

Group’s hedging programmes for interest

rate risk in the banking book rely on

behavioural assumptions and, as a result,

the effectiveness of the hedging strategy

cannot be guaranteed. A potential

mismatch in the balance or duration of the

hedging assumptions could lead to

earnings deterioration if there are interest

rate movements which are not adequately

hedged. A decline in interest rates may

also compress net interest margin on retail

and corporate portfolios. In addition, the

Group’s liquid asset portfolio is exposed to

potential capital and/or income volatility

due to movements in market rates and

prices which may have a material adverse

effect on the capital position of the Group.

|  |  |
| --- | --- |
|  |  |
| + | For further details on the Group’s approach to  treasury and capital risk,  refer to the  [treasury and](#i4be61753b7f243b19551b0bfbf3a2a0d_673)  [capital risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_673)  and  [treasury and capital risk](#i4be61753b7f243b19551b0bfbf3a2a0d_769)  [performance](#i4be61753b7f243b19551b0bfbf3a2a0d_769) sections. |
|  |

v) Operational risk

Operational risk is the risk of loss to the

Group from inadequate or failed processes

or systems, human factors or due to

external events where the root cause is

not due to credit or market risks. Examples

include:

a) Operational resilience

The Group functions in a highly

competitive market, with customers and

clients that expect consistent and smooth

business processes. The loss of or

disruption to business processing is a

material inherent risk  within the Group and

across the financial services industry,

whether arising through failures in the

Group’s technology systems, cyber and/or

data integrity disruptions, unavailability of a

Group site, closure of real estate services

provided through its retail branch network,

or unavailability of personnel or services

supplied by third parties, and there are

particular challenges with recovering from

a major cyberattack. Failure to build

resilience and recovery capabilities into

business processes, or into the services on

which the Group’s business processes

depend, may result in significant customer

detriment, costs to reimburse losses

incurred by the Group’s customers and

clients, and reputational damage.

b) Cyberattacks

Cyberattacks continue to be a global

threat inherent across all industries, with

the number and severity of attacks

continuing to rise. The financial sector

remains a primary target for

cybercriminals, hostile nation states,

opportunists and hacktivists. The Group,

like other financial institutions, experiences

numerous attempts to compromise its

cybersecurity protections. In 2023,

cybersecurity incidents experienced by

Barclays included distributed denial of

service (DDoS), phishing, credential

stuffing, and exploitation of software

vulnerabilities.

The Group cannot provide absolute

security against cyberattacks. Malicious

actors, who are increasingly sophisticated

in their methods, tactics, techniques and

procedures, seek to steal money, gain

unauthorised access to, destroy or

manipulate data, and disrupt operations.

Further, some of their attacks may not be

recognised or discovered until launched or

after initial entry into the environment,

such as novel or zero-day attacks that are

launched before patches are available and

defences can be readied. Other attacks

may take advantage of the window during

which patching or the deployment of other

defences is underway, but not yet

complete. Malicious actors are also

increasingly developing methods to avoid

prevention, detection and alerting

capabilities, including employing counter-

forensic tactics making response activities

more difficult. Cyberattacks can originate

from a wide variety of sources and target

the Group in numerous ways, including

attacks on networks, systems, applications

or devices used by the Group or parties

such as service providers and other

suppliers, counterparties, employees,

contractors, customers or clients,

presenting the Group with a vast and

complex defence perimeter. Moreover,

the Group does not have direct control

over the cybersecurity of the systems of

its clients, customers, counterparties and

third-party service providers and suppliers,

limiting the Group’s ability to effectively

protect and defend against certain threats

Some of the Group’s third-party service

providers and suppliers have experienced

successful attempts to compromise their

cybersecurity. These have included

ransomware attacks that have disrupted

the service providers’ or suppliers’

operations and, in some cases, have had

impacts on the Group's operations. Such

cyberattacks are likely to continue.

A failure in the Group’s adherence to its

cybersecurity policies, procedures or

controls, employee malfeasance, and

human, governance or technological error

could also compromise the Group’s ability

to successfully prevent and defend against

cyberattacks. Furthermore, certain legacy

technologies that are at or approaching

end-of-life may not be able to maintain

acceptable levels of security. The Group

has experienced cybersecurity incidents

and near-misses in the past, and it is

inevitable that additional incidents will

occur in the future. Cybersecurity risks are

expected to increase, due to factors such

as the increasing demand across the

industry and customer expectations for

continued expansion of services delivered

over the Internet; increasing reliance on

Internet-based products, applications and

data storage; the onset of AI, which may be

used to facilitate increasingly sophisticated

attacks; and changes in ways of working by

the Group’s employees, contractors, and

third party service providers and suppliers

and their subcontractors as a long-term

consequence of the COVID-19 pandemic.

Bad actors have taken advantage of

remote working practices and modified

customer behaviours, exploiting the

situation in novel ways that may elude

defences. Additionally, geopolitical turmoil

may serve to increase the risk of a

cyberattack that could impact Barclays

directly, or indirectly through its critical

suppliers or national infrastructure. In

recent years, the Group has faced a

heightened risk of cyberattack as a result

of the conflicts in Eastern Europe and the

Middle East.

Common types of cyberattacks include

deployment of malware to obtain covert

access to systems and data; ransomware

attacks that render systems and data

unavailable through encryption and

attempts to leverage business interruption

or stolen data for extortion; novel or zero-

day exploits; denial of service and

distributed denial of service attacks;

infiltration via business email compromise;

social engineering, including phishing,

vishing and smishing; automated attacks

using botnets; third-party customer,

vendor, service provider and supplier

account takeover; malicious activity

facilitated by an insider; and credential

validation or stuffing attacks using login

and password pairs from unrelated

breaches. A successful cyberattack of any

type has the potential to cause serious

harm to the Group or its clients and

customers, including exposure to potential

contractual liability, claims, litigation,

regulatory or other government action,

loss of existing or potential customers,

damage to the Group’s brand and

reputation, and other financial loss. The

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| Material existing and emerging risks (continued) | | | | | | | | | | |

impact of a successful cyberattack is also

likely to include operational consequences

(such as unavailability of services,

networks, systems, devices or data),

remediation of which could come at

significant cost.

Regulators worldwide continue to

recognise cybersecurity as a systemic risk

to the financial sector and have highlighted

the need for financial institutions to

improve their monitoring and control of,

and resilience to, cyberattacks. A

successful cyberattack may, therefore,

result in significant regulatory fines on the

Group. In addition, any new regulatory

measures introduced to mitigate these

risks are likely to result in increased

technology and compliance costs for the

Group.

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| --- | --- |
|  |  |
| + | For further details on the Group’s approach to  cyberattacks,  see the  [operational risk performance](#i4be61753b7f243b19551b0bfbf3a2a0d_679)  section. For further details on cybersecurity regulation  applicable to the Group, refer to the  [Supervision and](#i4be61753b7f243b19551b0bfbf3a2a0d_802)  [regulation](#i4be61753b7f243b19551b0bfbf3a2a0d_802)  section. |
|  |

c) New and emergent technology

Technology is fundamental to the Group’s

business and the financial services

industry. Technological advancements

present opportunities to develop new and

innovative ways of doing business across

the Group, with new solutions being

developed both in-house and in

association with third party companies. For

example, payment services and securities,

futures and options trading are

increasingly occurring electronically, both

on the Group’s own systems and through

other alternative systems, and becoming

automated. Whilst increased use of

electronic payment and trading systems

and direct electronic access to trading

markets could significantly reduce the

Group’s cost base, it may, conversely,

reduce the commissions, fees and margins

made by the Group on these transactions

which could have a material adverse effect

on the Group’s business, results of

operations, financial condition and

prospects. The rapid development in AI is

another area the Group is monitoring

closely. This includes the identification of

potential use cases for responsible

adoption of AI in the Group's own

operations as well as managing the threats

third party usage of AI may pose, including

with respect to cybersecurity and fraud.

Introducing new forms of technology,

however, has the potential to increase

inherent risk. Failure to evaluate, actively

manage and closely monitor risk during all

phases of business development and

implementation could introduce new

vulnerabilities and security flaws and have a

material adverse effect on the Group’s

business, results of operations, financial

condition and prospects.

d) External fraud

The nature of fraud is wide-ranging and

continues to evolve, as criminals seek

opportunities to target the Group’s

business activities and exploit changes in

customer behaviour and product and

channel use (such as the increased use of

digital products and enhanced online

services) or exploit new products. Fraud

attacks can be very sophisticated and are

often orchestrated by organised crime

groups who use various techniques to

target customers and clients directly to

obtain confidential or personal information

that can be used to commit fraud. The UK

market has also seen significant growth in

‘scams’ where the Group takes increased

levels of liability as part of a voluntary code

to provide additional safeguards to

customers and clients who are tricked into

making payments to fraudsters. The

impact from fraud can lead to customer

detriment, financial losses (including the

reimbursement of losses incurred by

customers), loss of business, missed

business opportunities and reputational

damage, all of which could have a material

adverse impact on the Group’s business,

results of operations, financial condition

and prospects.

e) Data management and information

protection

The Group holds and processes large

volumes of data, including personal

information, financial data and other

confidential information, and the Group’s

businesses are subject to complex and

evolving laws and regulations governing

the privacy and protection of data,

including Regulation (EU) 2016/679 (the

General Data Protection Regulation as it

applies in the EU and the UK). This data

could relate to: (i) the Group’s clients,

customers,  prospective clients and

customers and their employees; (ii) clients

and customers of the Group’s clients and

customers and their employees;(iii) the

Group’s suppliers, counterparties and

other external parties, and their

employees; and (iv) the Group’s

employees and prospective employees.

The international nature of both the

Group’s business and its IT infrastructure

also means that data and personal

information may be available in countries

other than those from where the

information originated. Accordingly, the

Group must ensure that its collection, use,

transfer and storage of data, including

personal information, complies with all

applicable laws and regulations in all

relevant jurisdictions, which could: (i)

increase the Group’s compliance and

operating costs; (ii) impact the

development of new products or services

or the offering of existing products or

services; (iii) affect how products and

services are offered to clients and

customers; (iv) demand significant

oversight by the Group’s management;

and (v) require the Group to review some

elements of the structure of its

businesses, operations and systems in less

efficient ways. Concerns regarding the

effectiveness of the Group’s measures to

safeguard data, including personal

information, or even the perception that

those measures are inadequate, could

expose the Group to the risk of loss or

unavailability of data or data integrity

issues and/or cause the Group to lose

existing or potential clients and customers,

and thereby reduce the Group’s revenues.

Furthermore, any failure or perceived

failure by the Group to comply with

applicable privacy or data protection laws

and regulations may subject it to potential

contractual liability, claims, litigation,

regulatory or other government action

(including significant regulatory fines) and

require changes to certain operations or

practices which could also inhibit the

Group’s development or marketing of

certain products or services, or increase

the costs of offering them to customers.

Any of these events could damage the

Group’s reputation, subject the Group to

material fines or other monetary penalties,

make the Group liable for the payment of

compensatory damages, divert

management's time and attention, lead to

enhanced regulatory oversight and

otherwise materially adversely affect its

business, results of operations, financial

condition and prospects.

|  |  |
| --- | --- |
|  |  |
| + | For further details on data protection regulation  applicable to the Group,  refer to the  [supervision and](#i4be61753b7f243b19551b0bfbf3a2a0d_802)  [regulation](#i4be61753b7f243b19551b0bfbf3a2a0d_802)  section. |
|  |

f) Algorithmic trading

In some areas of the investment banking

business, trading algorithms are used to

price and risk manage client and principal

transactions. An algorithmic error could

result in erroneous or duplicated

transactions, a system outage, or impact

the Group’s pricing abilities, which could

have a material adverse effect on the

Group’s business, results of operations,

financial condition, prospects and

reputation.

g) Processing errors

The Group’s businesses are highly

dependent on its ability to process and

monitor, on a daily basis, a very large

number of transactions, many of which are

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| Material existing and emerging risks (continued) | | | | | | | | | | |

highly complex and occur at high volumes

and frequencies, across numerous and

diverse markets in many currencies. As the

Group’s customer base and geographical

reach expand and the volume, speed,

frequency and complexity of transactions,

especially electronic transactions (as well

as the requirements to report such

transactions on a real-time basis to clients,

regulators and exchanges) increase,

developing, maintaining and upgrading

operational systems and infrastructure

becomes more challenging. The risk of

systems or human error in connection with

such transactions increases with these

developments, as well as the potential

consequences of such errors due to the

speed and volume of transactions involved

and the potential difficulty associated with

discovering errors quickly enough to limit

the resulting consequences. Furthermore,

events that are wholly or partially beyond

the Group’s control, such as a spike in

transaction volume, could adversely affect

the Group’s ability to process transactions

or provide banking and payment services.

Processing errors could result in the

Group, among other things: (i) failing to

provide information, services and liquidity

to clients and counterparties in a timely

manner; (ii) failing to settle and/or confirm

transactions; (iii) causing funds transfers,

capital markets trades and/or other

transactions to be executed erroneously,

illegally or with unintended consequences;

and (iv) adversely affecting financial,

trading or currency markets. Any of these

events could materially disadvantage the

Group’s customers, clients and

counterparties (including them suffering

financial loss) and/or result in a loss of

confidence in the Group which, in turn,

could have a material adverse effect on the

Group’s business, results of operations,

financial condition and prospects. Any of

these events could also lead to breaches

of laws, rules or regulations and, hence,

regulatory enforcement actions, which

could result in significant financial loss,

imposition of additional capital

requirements, enhanced regulatory

supervision and reputational damage.

h) Supplier exposure

The Group depends on suppliers for the

provision of many of its services and the

development of technology. Whilst the

Group depends on suppliers, it remains

fully accountable to its customers and

clients for risks arising from the actions of

suppliers and may not be able to recover

from its suppliers any amounts paid to

customers and clients for losses suffered

by them. The dependency on suppliers and

sub-contracting of outsourced services

introduces concentration risk where the

failure of specific suppliers could have an

impact on the Group’s ability to continue

to provide material services to its

customers.

Failure to adequately manage supplier risk

could have a material adverse effect on the

Group’s business, results of operations,

financial condition and prospects.

i) Estimates and judgements relating to

critical accounting policies and

regulatory disclosures

The preparation of financial statements

requires the application of accounting

policies and judgements to be made in

accordance with IFRS. Regulatory returns

and capital disclosures are prepared in

accordance with the relevant capital

reporting requirements and also require

assumptions and estimates to be made.

The key areas involving a higher degree of

judgement or complexity, or areas where

assumptions are significant to the

consolidated and individual financial

statements and regulatory returns and

disclosures, include credit impairment

provisions, taxes, fair value of financial

instruments, goodwill and intangible

assets, pensions and post-retirement

benefits, the calculation of RWAs and

capital, and provisions including conduct

and legal, competition and regulatory

matters (please refer to the notes to the

audited financial statements for further

details). There is a risk that if the

judgement exercised, or the estimates or

assumptions used, subsequently turn out

to be incorrect or are altered as a result of

subsequent feedback from the Group's

regulators, this could result in material

losses to the Group, beyond what was

anticipated or provided for, including as a

result of changes to treatments in

regulatory returns and capital disclosures.

If capital requirements are not met as the

result of changes in interpretation,

compliance with the Group's distribution

policy could be impacted and/or additional

measures may be required to strengthen

the Group's capital or leverage position,

which may also lead to the Group's inability

to achieve stated targets. Further

development of accounting standards and

regulatory interpretations could also

materially impact the Group’s results of

operations, financial condition and

prospects.

j) Tax risk

The Group is required to comply with the

domestic and international tax laws and

practice of all countries in which it has

business operations. There is a risk that

the Group could suffer losses due to

additional tax charges, other financial costs

or reputational damage as a result of failing

to comply with such laws and practice

(including where the Group’s interpretation

of such laws differs from the interpretation

of tax authorities), or by failing to manage

its tax affairs in an appropriate manner,

with much of this risk attributable to the

international structure of the Group. In

addition, the introduction of new

international tax regimes, increasing tax

authority focus on reporting and disclosure

requirements around the world as well as

the digitisation of the administration of tax

have the potential to increase the Group’s

tax compliance obligations further.

In 2023, the UK Government enacted

legislation on the OECD Inclusive

Framework on Base Erosion and Profit

Shifting Pillar Two Framework introducing

a global minimum tax rate of 15%.

The UK’s Pillar Two rules apply for

accounting periods beginning on or after

31 December 2023 which will increase the

Group's tax compliance obligations. In the

USA, the corporate alternative minimum

tax on adjusted financial statements

income introduced by the Inflation

Reduction Act became effective on 1

January 2023. These new tax regimes

require systems and process changes that

introduce potential additional operational

risks.

k) Ability to hire and retain appropriately

qualified employees

As a regulated financial institution, the

Group requires diversified and specialist

skilled colleagues. The Group’s ability to

attract, develop and retain a diverse mix of

talent is key to the delivery of its core

business activity and strategy. This is

impacted by a range of external and

internal factors, such as macroeconomic

factors, labour and immigration policy in

the jurisdictions in which the Group

operates, industry-wide headcount

reductions in particular sectors, regulatory

limits on compensation for senior

executives and the potential effects on

employee engagement and wellbeing from

long-term periods of working remotely.

Failure to attract or prevent the departure

of appropriately qualified and skilled

employees could have a material adverse

effect on the Group’s business, results of

operations, financial condition and

prospects. Additionally, this may result in

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| Material existing and emerging risks (continued) | | | | | | | | | | |

disruption to service which could in turn

lead to customer detriment and

reputational damage.

|  |  |
| --- | --- |
|  |  |
| + | For further details on the Group’s approach  to operational risk,  refer to the  [operational](#i4be61753b7f243b19551b0bfbf3a2a0d_679)  [risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_679) and  [operational risk](#i4be61753b7f243b19551b0bfbf3a2a0d_637)  [performance](#i4be61753b7f243b19551b0bfbf3a2a0d_637)  sections. |
|  |

vi) Model risk

Model risk is the potential for adverse

consequences from decisions based on

incorrect or misused model outputs and

reports. The Group relies on models to

support a broad range of business and risk

management activities, including informing

business decisions and strategies,

measuring and limiting risk, valuing

exposures (including the calculation of

impairment), conducting stress testing,

calculating RWAs and assessing capital

adequacy, supporting new business

acceptance, risk and reward evaluation,

managing client assets, and meeting

reporting requirements.

Models are, by their nature, imperfect

representations of reality and have some

degree of uncertainty because they rely on

assumptions and inputs, and so are subject

to intrinsic uncertainty, errors and

inappropriate use affecting the accuracy of

their outputs. This may be exacerbated

when dealing with unprecedented

scenarios, as was the case during the

COVID-19 pandemic, due to the lack of

reliable historical reference points and

data. For instance, the quality of the data

used in models across the Group has a

material impact on the accuracy and

completeness of its risk and financial

metrics. Model uncertainty, errors and

inappropriate use may result in (among

other things) the Group making

inappropriate business decisions and/or

inaccuracies or errors in the Group’s risk

management and regulatory reporting

processes. This could result in significant

financial loss, imposition of additional

capital requirements, enhanced regulatory

supervision and reputational damage, all of

which could have a material adverse effect

on the Group’s business, results of

operations, financial condition and

prospects.

|  |  |
| --- | --- |
|  |  |
| + | For further details on the Group’s approach  to model risk,  refer to the  [model risk](#i4be61753b7f243b19551b0bfbf3a2a0d_643)  [management](#i4be61753b7f243b19551b0bfbf3a2a0d_643)  and model risk performance  sections. |
|  |

vii) Compliance risk

Compliance risk is the risk of poor

outcomes for, or harm to, customers,

clients and markets, arising from the

delivery of the Group's products and

services  (conduct risk) and the risk to

Barclays, its clients, customers or markets

from a failure to comply with the laws, rules

and regulations (LRR) applicable to the

firm. This risk could manifest itself in a

variety of ways, including:

a)  Market conduct

The Group’s businesses are exposed to

risk from potential non-compliance with its

policies and standards (which incorporates

regulatory requirements set by law and our

regulators) and instances of wilful and

negligent misconduct by employees, all of

which could result in potential customer

and client detriment, enforcement action

(including regulatory fines and/or

sanctions), increased operation and

compliance costs, redress or remediation

or reputational damage which in turn could

have a material adverse effect on the

Group’s business, financial condition and

prospects. Examples of employee

misconduct which could have a material

adverse effect on the Group’s business

include: (i) improperly selling or marketing

the Group’s products and services; (ii)

engaging in insider trading, market

manipulation or unauthorised trading; or

(iii) misappropriating confidential or

proprietary information belonging to the

Group, its customers or third parties.

These risks may be exacerbated in

circumstances where the Group is unable to

rely on physical oversight and supervision of

employees, noting the move to a hybrid

working model for many colleagues.

b)  Customer protection

The Group must ensure that its customers,

particularly those that are vulnerable, are

able to make well-informed decisions on

how best to use the Group’s financial

services and understand the protection

available to them if something goes wrong.

Poor customer outcomes can result from

the failure to: (i) communicate fairly and

clearly with customers; (ii) provide services in

a timely and fair manner; (iii) handle and

protect customer data appropriately; and

(iv) undertake appropriate activity to address

customer detriment, including the

adherence to regulatory and legal

requirements on complaint handling. The

Group is at risk of financial loss and

reputational damage as a result also a risk of

regulatory censure or enforcement action.

In July 2023, the FCA’s new Consumer

Duty came into force for new and existing

products or services that are open to sale

or renewal. It will apply to closed products

and services from 31 July 2024. The duty

sets higher expectations for the standard

of care that firms provide to retail

customers and impacts all aspects of

Barclays’ retail businesses, including every

retail customer journey, product and

service as well as our relationships with

partners, suppliers and third parties. This

has resulted in significant implementation

costs and there will also be higher ongoing

costs for the industry as a result of

extensive monitoring and evidential

requirements.

c) Product design and review risk

Products and services must meet the needs

of clients, customers, markets and the

Group throughout their life cycle, However,

there is a risk that the design and review of

the Group’s products and services fail to

reasonably consider and address potential

or actual negative outcomes for customers,

which may result in customer detriment,

enforcement action (including regulatory

fines and/or sanctions), redress and

remediation and reputational damage. Both

the design and review of products and

services are a key area of focus for

regulators and the Group.

d) Financial crime

The Group may be adversely affected if it

fails to effectively mitigate the risk that third

parties or its employees facilitate, or that its

products and services are used to facilitate,

financial crime (money laundering, terrorist

financing, breaches of economic and

financial sanctions, bribery and corruption,

and the facilitation of tax evasion). UK and

US regulations covering financial institutions

continue to focus on combating financial

crime. Failure to comply may lead to

enforcement or other action  by the Group’s

regulators, including severe penalties, which

may have a material adverse effect on the

Group’s business, financial condition,

prospects and reputation.

e) Conflicts of interest

Identifying and managing conflicts of

interest is fundamental to the conduct of

the Group's business, relationships with

customers and clients, and the markets in

which the Group operates. Understanding

the Conflicts of Interest that impact or

potentially impact the Group enables them

to be identified, managed and mitigated

appropriately. Even if there is no evidence of

improper actions, a conflict of interest can

create an appearance of impropriety that

undermines confidence in the Group and its

employees. If the Group does not identify

and manage conflicts of interest (business

or personal) appropriately, it could have an

adverse effect on the Group’s business,

customers and the markets within which it

operates.

f) Regulatory focus on culture and

accountability

Regulators around the world continue to

emphasise the importance of culture and

personal accountability and enforce the

adoption of adequate internal reporting and

whistleblowing procedures to help to

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| Material existing and emerging risks (continued) | | | | | | | | | | |

promote appropriate conduct and drive

positive outcomes for customers,

colleagues, clients and markets. The

requirements and expectations of the UK

Senior Managers Regime, Certification

Regime and Conduct Rules reinforce

additional accountabilities for individuals

across the Group, with an increased focus

on governance and rigour, with similar

requirements also introduced in other

jurisdictions globally. Failure to meet these

requirements and expectations may lead to

regulatory sanctions, both for the individuals

and the Group.

g) Laws, rules and regulations

Barclays is subject to range of laws, rules

and regulations across the world. A failure

to comply with these may have an adverse

effect on the Barclays Bank Group’s

business, customers and the markets

within which it operates and could result in

reputational damage, penalties, damages

or fines.

|  |  |
| --- | --- |
|  |  |
| + | For further details on the Group’s approach to  compliance risk, refer to the  [compliance risk](#i4be61753b7f243b19551b0bfbf3a2a0d_646)  [management](#i4be61753b7f243b19551b0bfbf3a2a0d_646) and  [compliance risk performance](#i4be61753b7f243b19551b0bfbf3a2a0d_682)  sections. |
|  |

viii) Reputation risk

Reputation risk is the risk that an action,

transaction, investment, event, decision or

business relationship will reduce trust in

the Group’s integrity and/or competence.

Any material lapse in standards of integrity,

compliance, customer service or operating

efficiency may represent a potential

reputation risk. Stakeholder expectations

constantly evolve, and so reputation risk is

dynamic and varies between geographical

regions, groups and individuals. A risk

arising in one business area can have an

adverse effect upon the Group’s overall

reputation and any one transaction,

investment or event (in the perception of

key stakeholders) can reduce trust in the

Group’s integrity and competence. The

Group’s association with sensitive topics

and sectors has been, and in some

instances continues to be, an area of

concern for stakeholders, including: (i) the

financing of, and investments in,

businesses which operate in sectors that

are sensitive because of their relative

carbon intensity or local environmental

impact; (ii) potential association with

human rights violations (including

combating modern slavery) in the Group’s

operations or supply chain and by clients

and customers; and (iii) the financing of

businesses which manufacture and export

military and riot control goods and

services.

Reputation risk could also arise from

negative public opinion about the actual, or

perceived, manner in which the Group

(including its employees, clients and other

associations) conducts its business

activities, or the Group’s financial

performance, as well as actual or perceived

practices in banking and the financial

services industry generally.

Modern technologies, in particular, online

social media channels and other broadcast

tools that facilitate communication with

large audiences in short time frames and

with minimal costs, may significantly

enhance and accelerate the distribution

and effect of damaging information and

allegations. Negative public opinion may

adversely affect the Group’s ability to

retain and attract customers, in particular,

corporate and retail depositors, and to

retain and motivate staff, and could have a

material adverse effect on the Group’s

business, results of operations, financial

condition and prospects. Claims of

potential greenwashing arising from

sustainability-related statements made by

Barclays may also give rise to reputation

risk.

In addition to the above, reputation risk has

the potential to arise from operational

issues or conduct matters which cause

detriment to customers, clients, market

integrity, effective competition or the

Group (refer to ‘v) Operational risk’ above).

|  |  |
| --- | --- |
|  |  |
| + | For further details on the Group’s approach  to reputation risk,  refer to the  [reputation](#i4be61753b7f243b19551b0bfbf3a2a0d_649)  [risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_649)  and  [reputation risk](#i4be61753b7f243b19551b0bfbf3a2a0d_649)  [performance](#i4be61753b7f243b19551b0bfbf3a2a0d_649)  sections. |
|  |

ix) Legal risk and legal,  competition  and

regulatory  matters

The Group conducts activities in a highly

regulated global market which exposes it

and its employees to legal risk arising from:

(i) the multitude of  laws, rules and

regulations  that apply to the businesses it

operates, which are highly dynamic, may

vary between jurisdictions and/or conflict,

and may be  unclear in their application to

particular circumstances especially in new

and emerging areas; and (ii) the diversified

and evolving nature of the Group’s

businesses and business practices. In each

case, this exposes the Group and its

employees to the risk of loss or the

imposition of penalties, damages or fines

from the failure of members of the Group

to meet applicable laws, rules, regulations

or contractual requirements or to assert or

defend their intellectual property rights.

Legal risk may arise in relation to any

number of the material existing and

emerging risks identified above.

A breach of applicable laws, rules and/or

regulations by the Group or its employees

could result in criminal prosecution,

regulatory censure, potentially significant

fines and other sanctions in the

jurisdictions in which the Group operates.

Where clients, customers or other third

parties are harmed by the Group’s

conduct, this may also give rise to civil legal

proceedings, including class actions. Other

legal disputes may also arise between the

Group and third parties relating to matters

such as breaches or enforcement of legal

rights or obligations arising under

contracts, statutes or common law.

Adverse findings in any such matters may

result in the Group being liable to third

parties or may result in the Group’s rights

not being enforced or not being enforced

in the manner intended or desired by the

Group.

Details of legal, competition and regulatory

matters to which the Group is currently

exposed are set out in Note 25. In addition

to matters specifically described in Note

25, the Group is engaged in various other

legal proceedings which arise in the

ordinary course of business.

The Group is also subject to requests for

information, investigations and other

reviews (including skilled person reviews)

by regulators, governmental and other

public bodies. These may be in connection

with business activities in which the Group

is, or has been, engaged, or areas of

particular regulatory focus, such as

financial crime, money laundering or

terrorist financing. The Group may also

(from time to time) be subject to claims

and/or legal proceedings and other

investigations relating to financial and non-

financial disclosures made by members of

the Group (including, but not limited to,

regulatory capital and liquidity reporting

and ESG disclosures). Additionally, due to

the increasing number of new climate and

sustainability-related laws and regulations,

growing demand from investors and

customers for sustainable products and

services, and regulatory and NGO scrutiny,

financial institutions, including the Group,

may through their business activities face

increasing litigation, conduct, enforcement

and contract liability risks related to climate

change, environmental degradation and

other social, governance and

sustainability-related issues, including

greenwashing risk.

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| Material existing and emerging risks (continued) | | | | | | | | | | |

This may include laws and regulatory

processes and policies seeking to restrict

or prohibit doing certain business with

entities identified as "boycotting" or

"discriminating" against particular

industries or considering ESG factors in

their investment processes, including to

protect the energy and other high carbon

sectors from any risks of divestment or

challenges in accessing finance.

Furthermore, there is a risk that

shareholders, campaign groups,

customers and other interest groups could

seek to take legal action (including under

"soft law" mechanisms) against the Group

for financing or contributing to climate

change and environmental degradation or

because the Group's response to climate

change or other ESG factors is perceived

to be ineffective, insufficient or

inappropriate.

The outcome of legal, competition and

regulatory matters, both those to which

the Group is currently exposed and any

others which may arise in the future, is

difficult to predict (and any provision made

in the Group’s financial statements relating

to those matters may not be sufficient to

cover actual losses).

In connection with such matters, the

Group may incur significant expense,

regardless of the ultimate outcome, and

any such matters could expose the Group

to any of the following outcomes:

substantial monetary damages,

settlements and/or fines; remediation of

affected customers and clients; other

penalties and injunctive relief; additional

litigation; criminal prosecution; the loss of

any existing agreed protection from

prosecution; regulatory restrictions on the

Group’s business operations including the

withdrawal of authorisations; increased

regulatory compliance requirements or

changes to laws or regulations; suspension

of operations; public reprimands or

censure; loss of significant assets or

business; a negative effect on the Group’s

reputation; loss of confidence by investors,

counterparties, clients and/or customers;

risk of credit rating agency downgrades;

potential negative impact on the availability

and/or cost of funding and liquidity; and/or

dismissal or resignation of key individuals.

In light of the uncertainties involved in

legal, competition and regulatory matters,

there can be no assurance that the

outcome of a particular matter or matters

(including formerly active matters or those

arising after the date of this Annual Report)

will not have a material adverse effect on

the Group’s business, results of

operations, financial condition and

prospects.

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| Material existing and emerging risks (continued) | | | | | | | | | | |

Climate risk management

Climate risk is the impact on Financial

(Credit, Market, Treasury & Capital) and

Operational Risks arising from climate

change through physical risks and risks

associated with transitioning to a lower

carbon economy.

• Physical risks: Result from a changing

climate and can be event-driven (acute

risks), including increased frequency

and/or severity of extreme weather

events such as cyclones, hurricanes and

flooding. Physical risks can also be driven

by longer term shifts in climate patterns

(chronic risks) arising from sustained

higher temperatures that may cause

rises in sea levels, rising mean

temperatures and more frequent/

severe weather events.

• Transition risks: The transition to a lower

carbon economy is likely to involve

significant and rapid policy, regulatory

and legal changes, as evolving

technology and markets adapt to a

changing climate and associated

impacts.

Overview

The Group has developed a Climate Risk

Framework (CRF) for financial and

operational risks stemming from climate

change. This enables Barclays to foster a

systematic and consistent approach for

managing climate risk across the firm. The

key principle underpinning this framework

is that climate risk is recognised as a driver

of other existing financial (Credit, Market,

Treasury and Capital) and non financial

(including Operational and Reputational)

risks, and not treated as a standalone risk

type. The CRF is supported by policies,

standards and other relevant documents

which contain control objectives that must

be met.

The CRF:

• Defines climate risk

• Establishes principles for the

identification, measurement, monitoring

and reporting of climate risk

• Outlines the process for establishing

climate risk appetite

• Summarises the impact of climate risk

on other principal financial and

operational risk types

• Outlines roles and responsibilities

applicable to the Climate Risk

Framework

The Climate Risk Policy sets objectives for

the management of climate risks and

establishes key principles for quantifying

and reporting, including escalations

required to senior stakeholders up to and

including the Board Risk Committee (BRC).

The Framework and Policy are applicable

for Barclays' business activities, with a

focus on lending, advisory, sales and

trading, capital markets and investments.

Climate risk may also drive non-financial

risks such as reputational risk, which

continue to be managed under the

respective risk frameworks.

To support the embedment of the

Principal Risk, in 2023 the Group delivered

the following with three overarching

objectives:

1. Enhance and improve risk appetite and

associated controls for climate risk

2. Develop a plan for refining modelling and

scenario analysis capabilities

3. Expand BlueTrack™, which now covers

nine segments comprising of Energy,

Power, Cement, Steel, Automotive

Manufacturing, UK Housing, Commercial

Real Estate, Agriculture and Aviation

Organisation, roles and responsibilities

The Group Head of Climate Risk is the

Principal Risk owner accountable for the

management and oversight of the climate

risk profile. The Group Head of Climate

Risk reports directly to Group CRO.

On behalf of the Board, the BRC reviews

and approves the Group's approach to

managing climate risk.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  | Governance | Enterprise Risk Framework (ERMF) | | |  |
|  |  |  |  |  |
|  | Climate Risk Framework (CRF) |  | Reputation Risk Management  Framework (RRMF) |  |
|  |  |  |  |  |
|  | Board Risk Committee (BRC) |  | Board Sustainability  Committee (BSC) |  |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  | Risk | Credit, market, treasury &  capital and operational risks |  | Sustainability matters and  reputation risk associated with  climate change |  |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  | Ownership | Group Risk Committee (GRC) |  | Group Sustainability  Committee (GSC) |  |
|  |  |  |  |  |
|  | Group Chief Risk Officer |  | Head of Public Policy and  Corporate Responsibility |  |
|  |  |  |  |  |
|  | Group Head of Climate Risk |  | Group Head of Sustainability |  |
|  |  |  |  |  |  |

The Group Risk Committee (GRC) is the

most senior executive body responsible for

reviewing and challenging risk practices for

climate.

To support the oversight of Barclays'

climate risk profile, a Climate Risk

Committee (CRC) has been established as a

sub-committee of the GRC. The Group

Head of Climate risk is the Chair of the CRC.

Any material issues are escalated by the

CRC to the GRC, and the GRC

subsequently escalates to the BRC as

appropriate.

A Climate Risk control environment has

been established in alignment with the

Barclays' Control Framework. A Climate Risk

Control Forum (CRCF) was established in

2022 to oversee implementation and

operation of the Barclays Control

Framework, including reviewing risk events,

policy and issues management. Climate risk

assurance groups were also established and

are responsible for performing climate risk

specific reviews to support the embedding

of the Climate Risk Framework and Policy.

Entity Heads of Climate Risk have been

appointed across key Barclays legal entities,

namely Barclays Bank UK (BBUK) PLC,

Barclays Bank (BB) PLC, Barclays Bank

Ireland (BBI) PLC, and the US Intermediate

Holding Company (US IHC).

Broader sustainability matters and

reputation risk associated with climate

change are coordinated by the Group

Sustainability and ESG Team, led by the

Group Head of Sustainability.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 272 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Principal risk management | | | | | | | | | | |

Risk appetite

Barclays' approach to setting climate risk appetite is aligned with its ambition to be a net zero bank by 2050 and reducing financed

emissions in line with its disclosed sector targets. In accordance with the risk appetite policy and tolerance standards, Barclays has

established a climate risk appetite at the Group level, comprising of qualitative risk appetite statements and quantitative constraints.

This is reviewed and revised (where applicable) annually and formally approved by the Board.

In 2023, Barclays has enhanced its approach for the quantification of climate risk appetite by implementing additional limits and

controls, including around the expected financed emissions target (BlueTrack) pathways. The progress against these targets is

monitored on a regular basis whilst acknowledging the challenges and external dependencies to reduce financed emissions. The Group

continues to regularly review its risk appetite and enhance risk metrics including expansion of risk limits for priority sectors.

Risk identification

Physical and transition risk drivers can lead to adverse financial impacts through various transmission channels. Transmission channels

are causal chains that explain how climate risk drivers impact firms such as Barclays either directly through their own operations and

infrastructure or indirectly through their financing and investment activities as described earlier in the "Climate-related Risks" section on

page [67](#i4be61753b7f243b19551b0bfbf3a2a0d_253). The diagram below illustrates these dynamics.

The potential impact of physical risk events at the macro level may include lower GDP growth, higher unemployment and significant

changes in the availability and prices of products or commodities. At the micro level, damage to properties and operations of Barclays's

clients could lead to increasing costs and possible decline in revenues, which in turn might impact their ability to repay the loans. Thus

through these transmission channels, risks for Barclays may materialise in its traditional risk categories such as credit risk, market risk,

treasury and capital risk, operational risk and reputational risk. The impact of climate risk drivers may be significant and widespread,

affecting companies, households and the general economy leading to potential financial system contagion.

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Financial  system  contagion |
|  | Climate risks | |  |  | Economic transmission channels | | | |  |  |  | Financial risks | |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Transition risks  • Policy and legal  (e.g. carbon tax,  litigation actions)  • Reputation (e.g.  stakeholder  concern, change  in consumer  preferences)  • Technology (e.g.  substitute  technologies,  emissions  capture)  • Market (e.g.  change in market  sentiment,  uncertainty in  market signals) |  |  |  | Micro  Affecting individual businesses and households | | |  |  |  |  | Credit risk  • Defaults by  businesses and  households  • Collateral depreciation |  |
|  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  | Businesses  • Property damage and  business disruption from  severe weather  • Stranded assets and new  capital expenditure due to  transition  • Changing demand and costs  • Legal liability (from failure to  mitigate or adapt) |  | Households  • Loss of income (from  weather disruption and  health impacts, labour  market frictions)  • Property damage (from  severe weather) or  restrictions (from low-  carbon policies) increasing  costs and affecting  valuations |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  | Market risk  • Repricing of equities,  fixed income,  commodities etc. |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  | Compliance risk  • Increased costs to  comply with  regulatory  requirements |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Physical risks  • Chronic  (e.g. temperature,  precipitation,  agricultural  productivity,  sea levels)  • Acute  (e.g. heatwaves,  floods, cyclones  and wildfires) |  |  |  | Macro  Aggregate impacts on the macroeconomy | | |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  | • Capital depreciation and increased investment  • Shifts in prices (from structural changes, supply shocks)  • Productivity changes (from severe heat, diversion of investment  to mitigation and adaptation, higher risk aversion)  • Labour market frictions (from physical and transition risks)  • Socioeconomic changes (from changing consumption patterns,  migration, conflict)  • Other impacts on international trade, government revenues,  fiscal space, output, interest rates and exchange rates. | | |  |  |  |  | Operational risk  • Supply chain  disruption  • Forced facility closure |  |
|  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  | Liquidity risk  • Increased demand  for liquidity  • Refinancing risk |  |
|  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | |  |  |  |  | |  |  | |  |  |  |  | |  |  |  |
| Climate and economy feedback effects | | | | | | | |  | Economy and financial system feedback effects | | | | | | | |  |  |
| Adapted from Network for Greening the Financial System (NGFS), September 2022 and in consideration of transmission channels relevant to Barclays. | | | | | | | | | | | | | | | | | | |

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 273 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Principal risk management (continued) | | | | | | | | | | |

Barclays' work on assessing climate-related risks have been focused on the short (0-1 year) and medium term (1-5 years) horizons, in

line with our financial planning cycle. The feedback effects of climate risk drivers through macro and micro transmissions channels are

observed in Barclays' portfolio through traditional risk categories such as credit risk, market risk, treasury and capital risk, operational risk

(including legal risk) and reputational risk. Examples of these feedback effects are set out in the table below.

|  |  |
| --- | --- |
|  |  |
| Principal risk | Example effects of climate risk drivers |
| Credit risk | Increase in credit risk due to reduction in borrowers' ability to repay and service debt if the borrower is affected by  physical risk events that severely damages its infrastructure and operations. Borrowers that are subjected to higher  carbon taxes, penalties or fines for not adequately addressing their impact on climate (i.e. exposed to higher litigation  and reputational damages) or do not successfully transition to a lower carbon economy might see deterioration in their  credit ratings. In some instances, this could lead to borrowers going into default and impact banks' ability to recover loan  value. |
| Market risk | Uncertainty about timing, severity and frequency of extreme physical climate events may lead to higher volatility in  financial markets. Equity prices of corporates operating in carbon intensive sectors may decrease due to reduced  demand for products or services. Reduction in financial asset values can potentially lead to abrupt price adjustments,  resulting in market risk losses where climate risk is not priced into the asset value. |
| Treasury & capital risk | Severe physical events could trigger a sharp increase in demand for liquidity for financial firms, corporates and  households. Reduction in banks' access to stable sources of funding or withdrawal of deposits due to climate risk drivers  may negatively impact banks' liquidity positions. Deterioration of clients' risk profile due to climate risk drivers may also  lead to higher capital requirements. |
| Operational risk | Acute physical risk events may cause damage to banks' essential infrastructure and disrupt operations leading to higher  operational risks. Banks rely on a complex network of supplier and service providers. Climate change can disrupt supply  chains by affecting the availability of goods and services leading to delays or interruptions in critical operations.  Increasingly stringent climate and sustainability-related laws and regulations and the pace at which the regulations are  implemented means that banks, through their business activities, may face increasing litigation and other claims if they  are perceived to have contributed to or failed to prevent climate change or environmental damage, including by  financing client activities. |
| Reputation risk | Banks may face reputational risks related to climate change in various ways, as the public and stakeholders increasingly  expect banks to demonstrate their commitment to environmental sustainability. Banks that are perceived as not  adequately addressing climate risks may face reputational damage. Additionally, banks can be accused of greenwashing  if the information disclosed is misleading or if they are not able to meet their climate goals. |

Barclays has developed an internal climate

risk identification process to identify and

assess the potential impact of climate risk

as a driver of other principal risks. Drivers

of climate risk are identified and collated

through quarterly horizon scanning

exercises, following which information is

disseminated to relevant principal risk

teams. Following review by principal risk

teams, the relevant information feeds into

the Climate Risk Register. The Climate Risk

Register is maintained as per the ERMF and

is integrated into the Group Risk Register.

The Group Risk Register contains all

material risks that may impact forward-

looking business plans across key legal

entities (Barclays PLC, BBUK PLC, BBI PLC)

and business units (BUK and BI).

Quantitative (typically based on stress

testing) or qualitative assessments are

performed to quantify the impact of

material risks on capital or liquidity

positions of legal entities/business units.

Following this assessment, each material

risk is mapped to key drivers along with the

risk ratings (which are derived based on

magnitude of impact and materiality

thresholds). The Group Risk Register is

refreshed on at least an annual basis and is

subsequently used to support strategic

planning, scenario design, sensitivity

analysis and capital adequacy

assessments.

Barclays has also developed processes to

identify sectors, sovereigns and US States

which other Principal Risks must prioritise

for assessment of climate risks. Within

these processes, the Group analyses and

assesses the sensitivity and vulnerability of

different industry sectors and geographies

(including sovereigns and US states) to

various physical and transition risk drivers

and categorise them into different risk

buckets. Following this assessment, the

industry sectors and geographies that are

highly exposed to climate risks are deemed

to be of elevated risk. These assessments

are regularly reviewed and benchmarked

against external studies and research and

incorporate inputs from the subject matter

experts.

The outcomes of the above mentioned

processes namely the Climate Risk

Register, elevated sector and geography

(including sovereigns and US states)

assessments and underlying exposures,

form the basis of Barclays' approach and

priorities for further granular assessment.

Details on exposures to elevated sectors

are on pages [284](#i4be61753b7f243b19551b0bfbf3a2a0d_694) to [287](#i4be61753b7f243b19551b0bfbf3a2a0d_700).

In the UK Mortgages portfolio, segments

that are vulnerable to subsidence and

flood risk have been identified. Additionally,

Energy Performance Certificate (EPC)

ratings have been identified for portfolios

that are particularly vulnerable to transition

risk. Methodology and breakdown of

subsidence risk and flood risk bands in the

portfolio is available on page [288](#i4be61753b7f243b19551b0bfbf3a2a0d_703).

Additionally, through individual client

assessments and scenario analysis

exercises, Barclays identifies portfolios

that are more vulnerable to climate-

related risks.

Risk assessment

The emissions resulting from the activities

of customers and clients to whom

financing is provided is measured using

Barclays' bespoke tool BlueTrack™.

Currently, BlueTrack™ covers nine

segments comprising of Energy, Power,

Cement, Steel, Automotive

Manufacturing, UK Housing, Commercial

Real Estate, Agriculture and Aviation.

Details on the BlueTrack™ methodology

and targets are on pages [86](#i4be61753b7f243b19551b0bfbf3a2a0d_7650) to [99](#i4be61753b7f243b19551b0bfbf3a2a0d_307).

Furthermore, Barclays has developed the

Client Transition Framework (CTF) to

evaluate clients' progress as they

transition to a low-carbon business model.

Using BlueTrack™ data and public

disclosures, the framework evaluates both

qualitative and quantitative components

to assess transition trajectories against

Barclays’ targets and benchmarks. This

allows the Group to prioritise engagement

with clients based on their CTF scores.

Details on the CTF methodology are on

page [90](#i4be61753b7f243b19551b0bfbf3a2a0d_8287).

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 274 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Principal risk management (continued) | | | | | | | | | | |

During 2023, Barclays conducted industry-

specific deep dives to identify risk factors

and characteristics for those sectors. For

example, the power sector review

incorporated analysis of carbon intensity,

transition plans and the results of a

bespoke power utilities scenario analysis

(such as the effect of carbon pricing on

client financial performance).

Furthermore, Barclays has industry-

specific risk management processes

where appropriate. Granular asset-level

assessment is performed in the oil and gas

portfolio, prioritising the assessment of

clients that are non-investment grade and

operating in the upstream and midstream

sub-sectors. Taking into account factors

such as breakeven costs, geological

concerns, infrastructure constraints and

regulatory/geopolitical uncertainty,

Barclays has subsequently classified

clients and their assets into tiers from 1 to

3, with tier 3 considered the riskiest. Asset

tiering and assessment for these clients

are reviewed at least annually.

For Credit Risk, Barclays continues to

embed climate risk assessment into credit

assessment, annual review and transaction

approval processes to ensure that

climate-related risks are considered for

Wholesale Credit and Retail customers in

elevated risk sectors.

At a client level, the Climate Lens

questionnaire is used to evaluate physical,

transition and environmental risks

associated with firms operating in elevated

risk sectors. Each question is rated as Low,

Moderate or High based on the client’s

exposure and vulnerability to various

climate and environmental risk factors.

Climate Lens is currently being re-

developed with the aim of making it more

quantitative and improving its integration

within the credit processes.

For Market Risk, the impact of climate

change is measured by applying stress

scenarios that stress the core risks

susceptible to climate change over long

and short-term horizons to individual risk

factors. This process is conducted every

quarter. The pattern of stress losses

arising from the stress scenario is used to

estimate and set ongoing limits, consistent

with the Board-approved maximum stress

loss capacity for Market risk, under which

Barclays monitors and controls Market risk

arising from climate change.

For Treasury and Capital Risk, Barclays’

conducts Group-wide climate stress tests

to understand and assess the potential

impact on Barclays' capital position.

Climate risk considerations have also been

incorporated into the Internal Capital

Adequacy Assessment Process (ICAAP).

For Liquidity Risk, Barclays identifies and

assesses potential vulnerabilities of certain

industries and asset classes that may

deteriorate under a climate stress

scenario, and subsequently impact funding

and liquidity ratios. Climate risk

considerations have also been

incorporated into the Internal Liquidity

Adequacy Assessment Process (ILAAP).

For Pension Risk, key risk indicators based

on the impact of physical and transition risk

drivers on the pension fund have been

defined. These are reviewed and

monitored on a quarterly basis.

For operational risk, climate-related risks

continue to be assessed as part of existing

business-as-usual operational risk

processes. This includes working with

Premises and Operational Recovery

Planning teams to evaluate and respond to

climate-related impacts and regulatory

requirements Climate factors have been

integrated into Structured Scenario

Assessments, which capture extreme but

plausible operational tail risks. As part of

the assessment in 2023, climate risk has

been included in the building destruction

scenario (physical risks) and

greenwashing-related scenarios

(transition risks).

For reputational risk, the primary

responsibility for identifying and managing

reputation risk and adherence sits with the

front line business and support functions

where the risk arises. The Enhanced Due

Diligence process and other relevant

processes in these business units facilitate

the assessment of climate-related

reputational risk - details on this are on

page [236](#i4be61753b7f243b19551b0bfbf3a2a0d_559), while details on oversight and

management are embedded with the

Barclays governance framework on pages

[231](#i4be61753b7f243b19551b0bfbf3a2a0d_553) to [232](#i4be61753b7f243b19551b0bfbf3a2a0d_9553).

Across Barclays' portfolios, scenario

analysis continues to form a key part of the

Group’s approach to assessing and

quantifying the impact of climate change.

Details on the progress and outcomes of

our scenario analysis and stress testing

exercises are available on pages [131](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061446) to

[136](#i4be61753b7f243b19551b0bfbf3a2a0d_16064).

Risk monitoring  and reporting

In addition to the climate risk appetite,

Barclays has integrated climate risk

considerations into policies, standards and

lending guidelines. Consistent with our net

zero ambition and taking into account

considerations of all relevant business

factors, policies have been introduced to

progressively curtail or prohibit financing of

certain activities in sensitive sectors,

including upstream oil and gas, thermal

coal mining and coal-fired power

generation, Arctic oil and gas, oil sands,

hydraulic fracturing (fracking), Amazon oil

and gas, extra heavy oil and ultra-deep

water. These policies are reviewed

regularly and updated with respect to

external developments. Details on

restrictive policies are on page [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720).

Mandate and scale (M&S) exposure

controls translate risk appetite into a

detailed series of limits to control day-to-

day risk taking. Barclays has implemented

climate-aware limits and controls for

priority sectors, including based on,

BlueTrack™ measures of emissions

intensity and the Client Transition

Framework. For the UK retail portfolio,

physical and transition risk mandates are in

place for the UK Mortgages and Business

Banking Agriculture portfolios.

Quantitative and qualitative information

are presented and reviewed at the CRC. A

Group-level climate risk dashboard is

presented to BRC on a quarterly basis,

which is used to inform progress against

sector targets, current exposure to

portfolios with high physical and transition

risks, concentrations and climate risk

trends. The climate dashboard periodically

includes outputs and learnings from

internal stress test and regulatory

exercises and external developments

based on horizon scanning.

Legal entity specific climate risk

dashboards for monitoring and reviewing

climate-sensitive exposures have been

developed and presented to appropriate

committees. Where Climate Risk limits are

subject to ongoing monitoring, they will be

reported at the appropriate Principal Risk

Committees and CRC.

Barclays continues to enhance and

sophisticate our risk management

capabilities with our increased knowledge

and ability to quantify and manage climate-

related risks.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 275 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Principal risk management (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  |  |
|  | Nature Risk Assessment |  |
|  |  |  |
|  | In 2022-23, Barclays participated in a  TNFD pilot with UNEP FI, alongside  other financial institutions, focused on  UK and European agriculture and  fisheries, which in the Barclays  context means agriculture and food  sectors. As part of the pilot  programme, we worked with an  external expert to test the draft TNFD  framework, including the proposed  risk assessment process (LEAP FI), on  our agriculture and food portfolio in  Europe, with a focus on UK farming.  As reported last year, this involved  assessing our clients’ locations in  terms of production and sales and  applying a number of different 2030  scenarios to the portfolio. During  2023, we used the results of the pilot  to inform the management of nature-  related risks identified during the  assessment. For example, the results  informed the development of new  questions for the Client Transition  Tool (CTT) for UK farmers, which are  due to be incorporated in 2024. This  will help identify clients that may need  support in managing their nature-  related risks alongside  decarbonisation actions, and to  inform our client engagement  proposition. See page [94](#i3fc68118586e417aaf99f315b8ee44fc_124987) for more  details on our work with the UK  farming sector.  Further, in recognition of nature-  related impacts identified in the  agricultural value chain, we updated  our Forestry and Agricultural  Commodities Statement, which  included strengthening our existing  restrictions and introducing additional  new restrictions on clients operating  in agricultural commodity sectors  exposed to significant deforestation  risk. See page [100](#i4be61753b7f243b19551b0bfbf3a2a0d_20720) for details. |  |
|  |  |  |

Credit risk management

(audited)

The risk of loss to the Group from the

failure of clients, customers or

counterparties, including sovereigns, to

fully honour their obligations to the Group,

including the whole and timely payment of

principal, interest, collateral and other

receivables.

Overview

The credit risk that the Group faces arises

from wholesale and retail loans and

advances together with the counterparty

credit risk arising from derivative contracts

with clients; trading activities, including:

• debt securities, settlement balances

with market counterparties, fair value

through other comprehensive income

(FVOCI) assets and reverse repurchase

loans.

Credit risk management objectives are to:

• maintain a framework of controls to

oversee credit risk

• identify, assess and measure credit risk

clearly and accurately across the Group

and within each separate business, from

the level of individual facilities up to the

total portfolio

• control and plan credit risk taking in line

with external stakeholder expectations,

including risk return objectives, and

avoiding undesirable concentrations

• monitor credit risk and adherence to

agreed controls.

Organisation, roles and responsibilities

The first line of defence has primary

responsibility for managing credit risk

within the risk appetite and limits set by the

Risk function, supported by a defined set

of policies, standards and controls. In the

entities, business risk committees

(attended by the first line) monitor and

review the credit risk profile of each

business unit where the most material

issues are escalated to the Retail Credit

Risk Management Committee, Wholesale

Credit Risk Management Committee and

Group Risk Committee.

Wholesale and retail portfolios are

managed separately to reflect the differing

nature of the assets; wholesale balances

tend to be larger and are managed on an

individual basis, while retail balances are

greater in number but lesser in value and

are, therefore, managed in aggregated

segments.

The responsibilities of the credit risk

management teams in the businesses, the

sanctioning team and other shared

services include: sanctioning new credit

agreements (principally wholesale); setting

strategies for approval of transactions

(principally retail); setting risk appetite;

monitoring risk against limits and other

parameters; maintaining robust

processes, data gathering, quality, storage

and reporting methods for effective credit

risk management; performing effective

turnaround and workout scenarios for

wholesale portfolios via dedicated

restructuring and recoveries teams;

maintaining robust collections and

recovery processes/units for retail

portfolios; and review and validation of

credit risk measurement models.

The credit risk management teams in each

legal entity are accountable to the relevant

Legal Entity CRO , who reports to the

Group CRO.

For wholesale portfolios, credit risk

managers are organised in sanctioning

teams by geography, industry and/or

product. In wholesale portfolios, credit risk

approval is undertaken by experienced

credit risk professionals operating within a

clearly defined delegated authority

framework, with only the most senior

credit officers assigned the higher levels of

delegated authority. The largest credit

exposures, which are outside the Risk

Sanctioning Unit or Risk Distribution

Committee authority, require the support

of a legal entity Senior Credit Officer. For

exposures in excess of the legal entity

Senior Credit Officer’s authority, approval

by Group Senior Credit Officer/Board Risk

Committee is also required. The Group

Credit Risk Committee, attended by legal

entity Senior Credit Officers, provides a

formal mechanism for the Group Senior

Credit Officer to exercise the highest level

of credit authority over the most material

Group single name exposures.

Credit risk mitigation

The Group employs a range of techniques

and strategies to actively mitigate credit

risks. These can broadly be divided into

three types:

• netting and set-off

• collateral

• risk transfer.

Netting and set-off

Credit risk exposures can be reduced by

applying netting and set-off. For derivative

transactions, the Group’s normal practice

is, on a legal entity basis, to enter into

standard master agreements with

counterparties (e.g. ISDAs). These master

agreements typically allow for netting of

credit risk exposure to a counterparty

resulting from derivative transactions

against the obligations to the counterparty

in the event of default, and so produce a

lower net credit exposure. These

agreements may also reduce settlement

exposure (e.g. for foreign exchange

transactions) by allowing payments on the

same day in the same currency to be set-

off against one another.

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| Principal risk management (continued) | | | | | | | | | | |

Collateral

The Group has the ability to call on

collateral in the event of default of the

counterparty, comprising:

• home loans: a fixed charge over

residential property in the form of

houses, flats and other d wellings

• wholesale lending: a fixed charge over

commercial property and other physical

assets, in various forms

• other retail lending: includes charges

over other physical assets; second lien

charges over residential property; and

finance lease receivables

• derivatives: the Group also often seeks

to enter into a margin agreement (e.g.

Credit Support Annex) with

counterparties with which the Group has

master netting agreements in place.

These annexes to master agreements

provide a mechanism for further

reducing credit risk, whereby collateral

(margin) is posted on a regular basis

(typically daily) to collateralise the mark

to market exposure of a derivative

portfolio measured on a net basis

• reverse repurchase agreements:

collateral typically comprises highly liquid

securities which have been legally

transferred to the Group subject to an

agreement to return them for a fixed

price

• financial guarantees and similar off-

balance sheet commitments: cash

collateral may be held against these

arrangements.

Risk transfer

A range of instruments including

guarantees, credit insurance, credit

derivatives and securitisation can be used

to transfer credit risk from one

counterparty to another. These mitigate

credit risk in three main ways:

• if the risk is transferred to a

counterparty which is more

creditworthy than the original

counterparty, then overall credit risk is

reduced

• where recourse to the first counterparty

remains, both counterparties must

default before a loss materialises. This is

less likely than the default of either

counterparty individually so credit risk is

reduced.

• first loss exposures across pools of

credit risk can be hedged via synthetic

securitisation structures, typically via

CLN (credit lending notes) issuance. As

these are fully funded upfront they

provide for a direct reduction in credit

risk exposure on referenced pools.

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| + | Detailed policies are in place to appropriately  recognise and record credit risk mitigation. For more  information,  refer to pages 131 to 134 of the Barclays  PLC Pillar 3 Report 2023 (unaudited). |
|  |

Governance and oversight of ECLs under

IFRS 9

The Group’s organisational structure and

internal governance processes oversee

the estimation of ECL across several

areas, including: i) setting requirements in

policy, including key assumptions and the

application of key judgements; ii) the

design and execution of models; and iii)

review of ECL results.

i) Impairment policy requirements are set

and reviewed regularly, at a minimum

annually, to maintain adherence to

accounting standards. Key judgements

inherent in policy, including the estimated

life of revolving credit facilities and the

quantitative criteria for assessing the

significant increase in credit risk (SICR), are

separately supported by analytical study. In

particular, the quantitative thresholds used

for assessing SICR are subject to a number

of internal validation criteria, particularly in

retail portfolios where thresholds decrease

as the origination Probability of Default

(PD) of each facility increases. Key policy

requirements are also aligned to the

Group’s credit risk management strategy

and practices, for example, wholesale

customers that are risk managed on an

individual basis are assessed for ECL on an

individual basis upon entering Stage 3;

furthermore, key internal risk management

indicators of high risk are used to set SICR

policy, for example, retail customers

identified as high risk account

management are automatically deemed to

have met the SICR criteria.

ii) ECL is estimated in line with internal

policy requirements using models which

are validated by a qualified independent

party to the model development area, the

Independent Validation Unit (IVU), before

first use and on a regular basis, at a

minimum every three years. Each model is

designated an owner who is responsible

for:

• model maintenance: monitoring of

model performance including

backtesting by comparing predicted

ECL versus flow into stage 3 and

coverage ratios; proposing material

changes for independent IVU approval;

and recalibrating model parameters on

more timely data

• proposing post-model adjustments

(PMA) to address model weaknesses or

to account for situations where known

or expected risk factors and information

have not been considered in the

modelling process. All PMAs relating to

model deficiencies, regardless of value

are approved by IVU for a set time

period. PMAs representing Expert

Judgement are validated by Risk, as the

second line of defence and approved for

a set time period. The most material

PMAs are also approved by the CRO.

Models must also assess ECL across a

range of future economic conditions.

These economic scenarios are generated

via an independent model and ultimately

set by the Senior Scenario Review

Committee. Economic scenarios are

regenerated at a minimum twice annually

but more frequently if deemed

appropriate, and also to align with the

Group’s medium term planning exercise.

Each model used in the estimation of ECL,

including key inputs, are governed by a

series of internal controls, which include

the validation of completeness and

accuracy of data in golden source

systems, documented data

transformations and documented lineage

of data transfers between systems.

iii) The Group Impairment Committee,

formed of members from both Finance

and Risk and attended by both the Group

Finance Director and the Group CRO, is

responsible for overseeing impairment

policy and practice across the Group and

will approve impairment results. Reported

results and key messages are

communicated to the BAC, which has an

oversight role and provides challenge of

key assumptions, including the basis of the

scenarios adopted. Impairment results are

then factored into management decision

making, including but not limited to,

business planning, risk appetite setting and

portfolio management.

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| Principal risk management (continued) | | | | | | | | | | |

Market risk management

(audited)

The risk of loss arising from potential

adverse changes in the value of the

Group’s assets and liabilities from

fluctuation in market variables including,

but not limited to, interest rates, foreign

exchange, equity prices, commodity

prices, credit spreads, implied volatilities

and asset correlations.

Overview

Market risk arises primarily as a result of

client facilitation in wholesale markets,

involving market-making activities, risk

management solutions and execution of

syndications. Upon execution of a trade

with a client, the Group will look to hedge

against the risk of the trade moving in an

adverse direction. Mismatches between

client transactions and hedges result in

market risk due to changes in asset prices,

volatility or correlations.

Organisation, roles and responsibilities

Market risk in the businesses resides

primarily in Barclays International and

Treasury. These businesses have the

mandate to assume market risk. The front

office and Treasury trading desks are

responsible for managing market risk on a

day-to-day basis, where they are required

to understand and adhere to all limits

applicable to their businesses. The Market

Risk team supports the trading desks with

the day-to-day limit management of

market risk exposures through

governance processes which are outlined

in supporting market risk policies and

standards.

Market risk oversight and challenge is

provided by business committees and

Group committees, including the Market

Risk Committee (MRC).

The objectives of market risk management

are to:

• identify, understand and control market

risk by robust measurement, limit

setting, reporting and oversight

• facilitate business growth within a

controlled and transparent risk

management framework

• control market risk in the businesses

according to the allocated appetite.

To meet the above objectives, a

governance structure is in place to

manage these risks consistent with the

ERMF.

The BRC recommends market risk

appetite to the Board for their approval.

The Market Risk Principal Risk Lead (PR

Lead) is responsible for the Market Risk

Control Framework and, under delegated

authority from the Group CRO, agrees

with the business CROs a limit framework

within the context of the approved market

risk appetite.

The Market Risk Committee (MRC) reviews

and makes recommendations concerning

the group-wide market risk profile. This

includes overseeing the operation of the

Market Risk Framework and associated

policies and standards, monitoring market

and regulatory changes, and reviewing limit

utilisation levels.  The committee is chaired

by the PR Lead and attendees include the

business heads of market risk and business

aligned market risk managers.

In addition to MRC, the Corporate and

Investment Bank Risk Committee (‘CIBRC’)

is the main forum in which market risk

exposures are discussed and reviewed

with senior business heads. The

Committee is chaired by the CRO of

Barclays International and meets weekly,

covering current market events, notable

market risk exposures, and key risk topics.

New business initiatives are generally

socialised at CIBRC before any changes to

risk appetite or associated limits are

considered in other governance

committees.

The head of each business is accountable

for all market risks associated with its

activities, while the head of the market risk

team covering each business is

responsible for implementing the risk

control framework for market risk.

For more information on market risk

management, refer to the Barclays PLC

Pillar 3 Report 2023  (unaudited).

Management value at risk (VaR)

VaR is an estimate of the potential loss

arising from unfavourable market

movements if the current positions were

to be held unchanged for one business

day. For internal market risk management

purposes, a historical simulation

methodology with a one-year equally

weighted historical period, at the 95%

confidence level is used for all trading

books and some banking books.

Limits are applied at the total level as well

as by risk factor type, which are then

cascaded down to particular trading desks

and businesses by the market risk

management function.

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| + | See the [market risk performance](#i4be61753b7f243b19551b0bfbf3a2a0d_739)  section for a  review of management VaR. |
|  |

Treasury and capital risk

management

This comprises:

Liquidity risk: The risk that the Group is

unable to meet its contractual or

contingent obligations or that it does not

have the appropriate amount, tenor and

composition of funding and liquidity to

support its assets.

Capital risk: The risk that the Group has an

insufficient level or composition of capital

to support its normal business activities

and to meet its regulatory capital

requirements under normal operating

environments and stressed conditions

(both actual and as defined for internal

planning or regulatory testing purposes).

This also includes the risk from the Group’s

pension plans.

Interest rate risk in the banking book: The

risk that the Group is exposed to capital or

income volatility because of a mismatch

between the interest rate exposures of its

(non-traded) assets and liabilities.

The Treasury function manages treasury

and capital risk exposure on a day-to-day

basis with the Group Treasury Committee

acting as the principal management body.

The Treasury and Capital Risk function is

responsible for oversight and provides

insight into key capital, liquidity, interest

rate risk in the banking book (IRRBB) and

pension risk management activities.

Liquidity risk management

(audited)

Overview

The efficient management of liquidity is

essential to the Group in order to retain

the confidence of the financial markets

and maintain the sustainability of the

business. Treasury and Capital Risk have

created a framework to manage all liquidity

risk exposures under both normal and

stressed conditions. The framework is

designed to maintain liquidity resources

that are sufficient in amount, quality and

funding tenor profile to remain within the

liquidity risk appetite as expressed by the

Barclays PLC Board. The liquidity risk

appetite is monitored against both internal

and regulatory liquidity metrics.

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| Principal risk management (continued) | | | | | | | | | | |

Organisation, roles and responsibilities

Treasury has the primary responsibility for

managing liquidity risk within the set risk

appetite. Both Risk and Treasury

contribute to the production of the

Internal Liquidity Adequacy Assessment

Process (ILAAP). The Treasury and Capital

Risk function is responsible for the

management and governance of the

liquidity risk mandate, as defined by the

Board.

The framework established by Treasury

and Capital Risk is designed to deliver the

appropriate term and structure of funding,

consistent with the liquidity risk appetite

set by the Board. The framework

incorporates a range of ongoing business

management tools to monitor, limit and

stress test the Group’s balance sheet,

contingent liabilities and the recovery plan.

Limit setting and transfer pricing are tools

designed to control the level of liquidity risk

taken and drive the appropriate mix of

funds. Adherence to limits reduces the

likelihood that a liquidity stress event could

lead to an inability to meet Group’s

obligations as they fall due.

The Board approves the Group funding

plan, internal stress tests, regulatory stress

test results, recovery plan and liquidity risk

appetite. The Group Treasury Committee

is responsible for monitoring and

managing liquidity risk in line with the

Group’s funding management objectives,

funding plan and risk appetite. The

Treasury and Capital Risk Committee

monitors and reviews the liquidity risk

profile and control environment, providing

second line oversight of the management

of liquidity risk. The BRC reviews the risk

profile, and reviews liquidity risk appetite at

least annually and the impact of stress

scenarios on the Group funding plan/

forecast in order to agree the Group’s

projected funding abilities.

Capital risk management

(audited)

Overview

Capital risk is managed through ongoing

monitoring and management of the capital

and leverage position, regular stress

testing and a robust capital governance

framework. The objectives of the

framework are to maintain adequate

capital for the Group and legal entities to

withstand the impact of the risks that may

arise under normal and stressed

conditions, and maintain adequate capital

to cover current and forecast business

needs and associated risks to provide a

viable and sustainable business offering.

The Group  aims to prudently manage its

overall leverage position (including risk of

excessive leverage) by utilising plausible

stress scenarios, reviewing and deploying

management actions in response to

deteriorating economic and commercial

positions.  In order to manage contingent

leverage risk, the Group considers the

context from which the business

consumption arises, the impact of client

utilisation on leverage and the available

actions to manage.

Organisation, roles and responsibilities

Treasury has the primary responsibility for

managing and monitoring capital

adequacy. The Treasury and Capital Risk

function provides oversight of capital risk.

Production of the Barclays PLC Internal

Capital Adequacy Assessment Process

(ICAAP) is the responsibility of Treasury.

Capital risk management is underpinned by

a control framework and policy. The capital

management strategy, outlined in the

Group and legal entity capital plans, is

developed in alignment with the control

framework and policy for capital risk, and is

implemented consistently in order to

deliver on the Group’s objectives.

The Board approves the Group capital

plan, internal stress tests and results of

regulatory stress tests, and the Group

recovery plan. The Group Treasury

Committee is responsible for monitoring

and managing capital risk in line with the

Group’s capital management objectives,

capital plan and risk frameworks. The

Treasury and Capital Risk Committee

monitors and reviews the capital risk profile

and control environment, providing

second line oversight of the management

of capital risk. The BRC reviews the risk

profile, and reviews risk appetite at least

annually and the impact of stress scenarios

on the Group capital plan/forecast in order

to agree the Group’s projected capital

adequacy.

Local management assures compliance

with an entity’s minimum regulatory capital

requirements by reporting to local Asset

and Liability Committees (ALCOs) with

oversight by the Group Treasury

Committee, as required. In 2023, Barclays

complied with all regulatory minimum

capital requirements. Contingent leverage

risk is managed by; i) setting

comprehensive leverage (and RWA)

targets for each business as part of the

Treasury capital management process,

taking into account adherence to early

warning indicators and maintain a healthy

leverage ratio, and; ii) Monitoring execution

of actions taken to course-correct as

necessary.

The Group maintains a number of defined

benefit pension schemes for past and

current employees. The ability of schemes

to meet pension payments is achieved

with investments and contributions.

Pension risk arises because the market

value of pension fund assets might decline;

investment returns might reduce; or the

estimated value of pension liabilities might

increase. The Group monitors the pension

risks arising from its defined benefit

pension schemes and works with the

relevant pension fund’s trustees to

address shortfalls. In these circumstances,

the Group could be required or might

choose to make extra contributions to the

pension fund. The Group’s main defined

benefit scheme was closed to new

entrants in 2012.

Interest rate risk in the banking

book management (IRRBB)

Overview

Interest rate risk in the banking book is

driven by customer deposit taking and

lending activities, investments in the liquid

asset portfolio and funding activities. As

per the Group’s policy to remain within the

defined risk appetite, hedging strategies

are executed to mitigate the various IRRBB

risks that result from these activities.

However, the Group remains susceptible

to interest rate risk and other non-traded

market risks from the following key

sources:

• Interest rate and repricing risk: the risk

that net interest income could be

adversely impacted by a change in

interest rates, differences in the timing

of interest rate changes between assets

and liabilities, and other constraints on

interest rate changes as per product

terms and conditions.

• Customer behavioural risk: the risk that

net interest income could be adversely

impacted by the discretion that

customers and counterparties may have

in respect of being able to vary from

their contractual obligations with

Barclays. This risk is often referred to by

industry regulators as ‘embedded option

risk’.

• Investment risks in the liquid asset

portfolio: the risk that the fair value of

assets held in the liquid asset portfolio

and associated risk management

portfolios could be adversely impacted

by market volatility, creating volatility in

capital directly.

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| Principal risk management (continued) | | | | | | | | | | |

Organisation, roles and responsibilities

The entity ALCOs and/or treasury

committees, together with the Group

Treasury Committee, are responsible for

monitoring and managing IRRBB risk in line

with the Group’s management objectives

and risk frameworks. The GRC and

Treasury and Capital Risk Committee

monitors and reviews the IRRBB risk profile

and control environment, providing

second line oversight of the management

of IRRBB. The BRC reviews the interest

rate risk profile, including review of the risk

appetite at least annually and the impact of

stress scenarios on the interest rate risk of

the Group’s banking books.

In addition, the Group’s IRRBB policy sets

out the processes and key controls

required to identify all IRRBB risks arising

from banking book operations, to monitor

the risk exposures via a set of metrics with

a frequency in line with the risk

management horizon, and to manage

these risks within agreed risk appetite and

limits.

Model risk management

The potential for adverse consequences

from decisions based on incorrect or

misused model outputs and reports.

Overview

The Bank uses models to support a broad

range of activities, including informing

business decisions and strategies,

measuring and limiting risk, valuing

exposures, conducting stress testing,

assessing capital adequacy, managing

client assets, and meeting reporting

requirements.

Organisation, roles and responsibilities

The Barclays Group has a dedicated Model

Risk Management (‘MRM’) function that

consists of six teams:

(i) Independent Validation Unit (‘IVU’),

responsible for model validation and

approval;

(ii) Group Model Risk Governance,

responsible for model risk governance,

controls and reporting, as well as providing

oversight for compliance of the Model

Owner community with the Model Risk

Framework;

(iii) Framework team, responsible for the

Model Risk Policy and associated

standards;

(iv) Infrastructure Delivery and Oversight,

responsible for the delivery of model

inventory including associated data quality

& reporting and oversight of Quantitative

Processes;

(v) COO, responsible for strategy,

communications and business

management; and

(vi) Model Risk Measurement and

Quantification (‘MRMQ’), responsible for

the design of the framework and

methodology to measure and, where

possible, quantify model risk. It is also

responsible for the strategic Validation

Centre of Excellence (‘VCoE’), which is an

independent quality assurance function

within MRM with the mandate to review

and challenge validation outcomes. VCoE

is aligned to the Group Model Risk

Governance team.

The Group Model Risk Committee is

MRM’s primary risk committee and a

subcommittee of the Group Risk

Committee. It is convened with senior

executives in the first and second line of

defence to oversee the model risk profile

and risk appetite.

The Model Risk Framework is defined and

implemented through Model Risk Policy

and Standards that prescribe the Barclays

Group-wide, end-to-end requirements for

the identification, measurement and

management of model risk, covering

model documentation, development,

testing, monitoring, annual review,

independent validation and approval,

change and reporting processes.

The function reports to the Barclays Group

CRO and operates a global framework.

Implementation of best practice standards

is a central objective of the Barclays Group.

The key model risk management activities

include:

• Correctly identifying models across all

relevant areas of the Bank and recording

models in the Barclays Group Models

Database (‘GMD’), the Barclays Group-

wide model inventory.

• Enforcing that every model has a model

owner who is accountable for the model.

The model owner must sign off models

prior to submission to the Independent

Validation Unit (IVU) for validation and

ensure that the model presented to IVU

is and remains fit for purpose.

• Overseeing that every model is subject

to validation and approval by IVU, prior

to use and on a continual basis.

• Defining the model risk appetite in terms

of risk tolerance, and qualitative metrics

which are used to track and report on

model risk.

Operational risk management

The risk of loss to the Group from

inadequate or failed processes or systems,

human factors or due to external events

(for example, fraud) where the root cause

is not due to credit or market risks.

Overview

The management of operational risk has

three key objectives:

• deliver and oversee an operational risk

capability owned and used by business

leaders to enable sound risk decisions

over the long term

• provide the frameworks, policies and

standards to enable management to

meet their risk management

responsibilities while the second line of

defence provides robust, independent,

and effective oversight and challenge

• deliver a consistent and aggregated

measurement of operational risk that

will provide clear and relevant insights,

so that the right management actions

can be taken to keep the operational risk

profile consistent with the Group’s

strategy, the stated risk appetite and

stakeholder needs.

The Group operates within a system of

internal controls that enables business to

be transacted and risk taken without

exposing it to unacceptable potential

losses or reputational damages.

Organisation, roles and responsibilities

The prime responsibility for the

management of operational risk and the

compliance with control requirements

rests within the business and functional

units where the risk arises. The operational

risk profile and control environment is

reviewed by management through

business risk committees and control

committees. Operational risk issues

escalated from these meetings are

considered through the second line of

defence review meetings. Depending on

their nature, the outputs of these

meetings are presented to the Operational

Risk Profile Forum, the Operational Risk

Committee, the BRC or the BAC. In

addition, specific reports are prepared by

Operational Risk on a regular basis for the

GRC and the BRC.

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| Principal risk management (continued) | | | | | | | | | | |

Legal entities, businesses and functions

are required to report their operational

risks on both a regular and an event-driven

basis. The reports include a profile of the

material risks that may threaten the

achievement of their objectives and the

effectiveness of key controls, operational

risk events and a review of scenarios.

The Group Head of Operational Risk is

responsible for establishing, owning and

maintaining an appropriate group-wide

Operational Risk Framework and for

overseeing the portfolio of operational risk

across the Group.

The Operational Risk function acts in a

second line of defence capacity, and is

responsible for defining and overseeing

the implementation of the framework and

monitoring the Group’s operational risk

profile, including risk-based review  and

challenge. The Operational Risk function

alerts management when risk levels

exceed acceptable tolerance in order to

drive timely decision- making and actions

by the first line of defence.

Operational risk categories

Operational risks are grouped into risk

categories to support effective risk

management, measurement and

reporting. These comprise: Data

Management Risk; Financial Reporting

Risk; Fraud Risk; Information Security Risk;

Operational Recovery Planning Risk;

Payments Process Risk; People Risk;

Premises Risk; Physical Security Risk;

Change Delivery Management Risk;

Supplier Risk; Tax Risk; Technology Risk;

and Transaction Operations Risk.

In addition to the above, operational risk

encompasses risks associated with

compliance with Group Resolution

Planning Prudential regulatory

requirements.

|  |  |
| --- | --- |
|  |  |
| + | For definitions of the Group’s Operational Risk  Categories and connected risks,  refer to the  management of operational risk section in the Barclays  PLC Pillar 3 Report 2023. |
|  |

Compliance Risk management

The risk of poor outcomes for, or harm to,

customers, clients and markets, arising

from the delivery of the Group’s products

and services (conduct risk), and the risk to

Barclays, its clients, customers or markets

from a failure to comply with the laws, rules

and regulations (LRR) applicable to the

firm.

Overview

Compliance risk incorporates market

integrity, customer protection, financial

crime, product design and review, and the

newly created laws, rules and regulation

risks. Barclays has no appetite to operate

its business other than in full accordance

with all applicable laws, rules and

regulations, in order to deliver good

outcomes for / avoid harm to customers,

clients and markets. Barclays will act in

good faith; seeking to avoid causing

foreseeable harm and to enable and

support customers to pursue their

financial objectives.

Organisation, roles and responsibilities

The Compliance Risk Management

Framework (CRMF) outlines how the

Group manages and measures its conduct

risk profile. The Group Chief Compliance

Officer is accountable for developing,

maintaining and overseeing the CRMF.

This includes defining and owning the

relevant compliance risk policies which

detail the control objectives, principles and

other core requirements for the activities

of the Group. It is the responsibility of the

first line of defence to establish conduct

related controls to manage its

performance and assess conformance to

these policies and controls. The

responsibility for LRR risk management

sits across various functions and business

units, including Legal, Chief Controls

Office, Risk and Compliance.

Senior managers are accountable within

their areas of responsibility for owning and

managing compliance risk in accordance

with the CRMF, as defined within their

regulatory Statement of Responsibilities,

and a dedicated team has been

established in Compliance to oversee LRR

risk management.

Compliance as an independent second line

function oversees that compliance risks

are effectively identified, managed,

monitored and escalated, and has a key

role in helping Barclays achieve the right

conduct outcomes and evolve a

compliance-focused culture.

The governance of Compliance risk within

the Group is fulfilled through management

committees and forums operated by the

first and second lines of defence with clear

escalation and reporting lines to the Board.

The Barclays Group and Barclays Bank

Group Risk Committee and the Barclays

Bank UK Group Risk Committee are the

primary second line governance

committees for the oversight of the

Compliance Risk Profile. The risk

committees’ responsibilities include the

identification and discussion of any

emerging compliance risk exposures in the

Barclays Group and Barclays Bank Group. A

new sub-committee of the Group Risk

Committee was established in August

2023 to provide oversight on LRR risk. This

committee is chaired by the Group Chief

Compliance Officer.

Compliance Risk

By effectively managing Compliance risks,

we can continue to strengthen the culture

of Barclays.

Culture and conduct

We believe the stronger our culture, the

better the choices our people will make;

and the stronger our business will be for all

our stakeholders. While our culture helps

us reduce the impact of poor conduct on

our customers, we also do not intend to

repeat the errors of the past.

Our most senior leaders spend significant

time setting the right tone at Barclays and

our Purpose and Values are now deeply

embedded in their messages. The Barclays

Way sets out the standards and behaviour

all employees must demonstrate and

guides the execution of our business. We

also strengthen our culture with clear and

effective controls. We continue investing

to enhance our controls to support our

commitment to conducting all activities

with integrity.

|  |  |
| --- | --- |
|  |  |
| + | For details of the Board's role in embedding our  Culture, Purpose, Values and Mindset, please refer to  page  [154](#i4be61753b7f243b19551b0bfbf3a2a0d_7146825599557)  of the Directors' Report. |
|  |

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 281 |
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| Principal risk management (continued) | | | | | | | | | | |

The Barclays Mindset

Our Mindset acts as an operating manual

for how to get things done at Barclays. It

focuses on three key elements that are

core to our success – Empower, Challenge

and Drive. Our research shows that when

we demonstrate behaviours aligned to

these three elements, outcomes are

better, colleagues are more engaged and

they are more likely to stay longer to build

their career at Barclays.

|  |  |
| --- | --- |
|  |  |
| + | For further details, see page [27](#i57cc5612cb4544d591df3020a106622d_94001)  in the Strategic  Report for more information on the Barclays  Mindset. |
|  |

Managing Compliance risks

|  |  |
| --- | --- |
|  |  |
| + | See page [179](#i823b684a5d6442708dc36f3751a22518_8-0-1-1-1841111) in the Directors' report in  addition to pages [269](#i0ab862df64694b71835de27f845c8b9a_5265) and [361](#i3809078ffd7c42d98bb74bb1fb4d1141_2598) in the risk review  section for more information on how the  Group defines, manages and mitigates  Compliance risks. |
|  |

Product design and review risk

It is important that the design of our

products and services meets the needs of

clients, customers and markets as well as

being aligned with Barclays' policies. We do

this by operating two processes, which

together form our product design and

review risk framework.

We have a process that supports the

Group in the approval and implementation

of New and Amended Products and

Approval process (known as the NAPA

Process, set out in the Barclays NAPA

Policy and Standards).

This process outlines the requirements

and risk assessment standards that must

be met to help ensure that new and

amended products and services are

appropriately designed prior to their

launch.

In addition we have a complementary

process that reviews the existing portfolio

of products and services throughout their

lifecycle (known as the Product Review

Process, set out in the Barclays Product

Review Policy and Standard). This process

considers information about the

performance and operation of the product

or service through a conduct lens.

Wherever a product or service is found to

be outside appetite, the product or service

owner must seek to ensure actions are

taken to address it. These actions are

validated by functional areas, including

Legal and Compliance.

Areas of Barclays that undertake

Investment activity also operate additional

product governance processes and

controls, reflecting the higher risk of these

more complex products and the

importance of products and services

meeting the needs of our Clients.

|  |  |
| --- | --- |
|  |  |
| + | The BPLC, BBPLC and BBUKPLC Board Risk  Committees review, on behalf of their respective  Boards, the management of Compliance risk and the  Compliance risk profile for their respective entities.  Please refer to the report of the BPLC Board Risk  Committee on pages  [174](#i4be61753b7f243b19551b0bfbf3a2a0d_487) and [179](#i823b684a5d6442708dc36f3751a22518_8-0-1-1-1841111) and the reports of  the BBPLC and BBUKPLC Board Risk Committees  within the BBPLC and BBUKPLC 2023 Annual Reports  available at[home.barclays/investor-relations/reports-](https://home.barclays/investor-relations/reports-and-events/annual-reports)  [and-events/annual-reports/ for more information](https://home.barclays/investor-relations/reports-and-events/annual-reports) . |
|  |

Customer communications

It is important that our engagement with

our customers is open and honest and that

we treat them fairly to avoid foreseeable

harm and to make sure they are not

exploited or misled. Barclays continues to

take steps to ensure that our customers’

needs and priorities are understood before

making recommendations and that the

communications we provide allow

informed decisions to be made. We work

to achieve this through a number of

controls which focus on ensuring our

customers receive clear information in

order to understand the risks and benefits

of the products we offer. For example:

• communications are sufficient, targeted

and distributed to recipients whom

Barclays knows or reasonably believes

may stand to benefit from the

communication, and are communicated

in a manner and style that will be

understood by the average recipient (or

likely recipient),

• communications are withdrawn from

further circulation when they are no

longer accurate or fit for purpose, and

• customers do not receive inadequate

advice, misleading information,

unsuitable products or unacceptable

service.

Our processes include a review of relevant

communications which are supported by

the Compliance and Legal functions to

help ensure we meet both internal

customer engagement standards and we

are compliant with external regulations.

Furthermore annual mandatory training is

completed by marketing colleagues. The

training covers key customer and brand

standards along with the role and key

policies set by external regulators e.g.

regulatory requirements may require

communications to be provided that are

accessible to customers, or provide

customers with the option to 'opt out'.

Remediation and redress

Barclays recognises that customer

detriment may occur as a result of our

error, actions or inactions, and that we

must undertake appropriate activity

designed to ensure our customers are put

back in the position they would have been

in had the issue not occurred.

Remediation can be proactive, where we

have identified the issue ourselves (for

example through identifying a pattern in

customer complaints), or reactive, where

identified by a third party such as a

regulator of Barclays.

Where it is appropriate, Barclays works to

ensure the operation of consistent

principles for remediation which includes

timely notification to the relevant

regulatory bodies.

Reputation Risk management

The risk that an action, transaction,

investment, event, decision, or business

relationship will reduce trust in the Group’s

integrity and/or competence.

Overview

A reduction of trust in the Group’s integrity

and competence may reduce the

attractiveness of the Group to

stakeholders and could lead to negative

publicity, loss of revenue, regulatory or

legislative action, loss of existing and

potential client business, reduced

workforce morale and difficulties in

recruiting talent. Ultimately it may destroy

shareholder value.

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| Principal risk management (continued) | | | | | | | | | | |

Organisation, roles and responsibilities

Barclays PLC Board is the most senior

body responsible for reviewing and

monitoring the effectiveness of the

Group’s management of reputation risk.

The Group Chief Compliance Officer is

accountable for developing a Reputation

Risk Management Framework (RRMF), and

the Head of Public Policy and Corporate

Responsibility is responsible for the

publication of appropriate Reputation Risk

policies and associated standards,

including tolerances against which data is

monitored, reported on and escalated, as

required. The RRMF sets out what is

required to manage reputation risk across

the Group.

The primary responsibility for identifying

and managing reputation risk and

adherence to the control requirements

sits with the business and support

functions where the risk arises.

Barclays Bank Group and Barclays Bank UK

Group are required to operate within

established reputation risk appetite, and

their component businesses prepare

reports highlighting their most significant

current and potential reputation risks and

issues and how they are being managed.

These reports are a key internal source of

information for the quarterly reputation

risk reports which are prepared for

Barclays Group ExCo and reviewed by the

Group Board twice-yearly.

The Group Reputation Risk Committee is a

sub-committee of the Group Executive

Committee, authorised to manage

material reputation risks and issues as they

are brought to the attention of the

committee via relevant reputation risk

assessment and escalation processes.

Legal Risk management

The risk of loss or imposition of penalties,

damages or fines from the failure of the

firm  to meet applicable laws, rules,

regulations or  contractual requirements

or assert or defend its intellectual property

rights.

Overview

The multitude of laws and regulations

across the globe are highly dynamic and

their application to particular

circumstances is often unclear. This

results in a high level of inherent legal risk

which the Group seeks to mitigate through

the operation of a Group-wide legal risk

management framework. This seeks to

mitigate legal risk, including through the

implementation of Group-wide legal risk

policies requiring engagement of legal

professionals in situations that have the

potential for legal risk, identification and

management of legal risks by those

professionals, and escalation of legal risk

as necessary. Legal Risk is also mitigated

by the complementary requirements of

the compliance risk management

framework, including the responsibility of

legal professionals to proactively identify,

communicate and provide legal advice on

applicable laws, rules and regulations.

Notwithstanding these mitigating actions,

the Group operates with a level of residual

legal risk, for which the Group has limited

tolerance.

Organisation, roles and responsibilities

The Group's businesses and functions

have responsibility for identifying and

escalating to the Legal Function legal risk in

their areas, as well as responsibility for

adherence to control requirements.

The Legal Function organisation and

coverage model aligns legal expertise to

businesses, functions, products, activities

and geographic locations so that the

Group receives legal advice and support

from appropriate legal professionals,

working in partnership proactively to

identify, manage and escalate legal risks as

necessary.

The senior management of the Legal

Function oversees, challenges and

monitors the legal risk profile and

effectiveness of the legal risk control

environment across the Group. The Legal

Function provides support to all areas of

the bank and is not formally part of any of

the three lines of defence. Except in

relation to the legal advice it provides or

procures, the Legal Function is subject to

oversight from the second line of defence

with respect to its own operational and

compliance risks, as well as with respect to

the legal risk to which the bank is exposed.

The Group General Counsel is responsible

for developing and maintaining a Group-

wide legal risk management framework.

This includes defining the relevant legal risk

policies, producing the Group-wide risk

appetite statement for legal risk, and

oversight of the implementation of controls

to manage and escalate legal risk.

The legal risk profile and control

environment is reviewed by management

through business risk committees and

control committees. The Group Risk

Committee is the most senior executive

body responsible for reviewing and

monitoring the effectiveness of risk

management across the Group. Escalation

paths from this committee exist to the

Barclays PLC Board Risk Committee.

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| Governance |  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Principal risk management (continued) | | | | | | | | | | |

#### Climate risk performance

Carbon-related assets

According to TCFD, certain industry segments are more likely to be financially impacted than others due to their exposure to certain

transition and physical risks around greenhouse gas (GHG) emissions, energy, or water dependencies associated with their operations

and products. These non-financial industries are grouped into four key areas: Energy; Transportation; Materials and Buildings; and

Agriculture, Food, and Forest Products. Barclays’ exposures to the industries within these groups are reported as carbon-related assets

and can be found in the table on the following page.

Elevated risk sectors

Based on portfolio level assessments (including for industry sectors) on climate risk, Barclays identifies and categorises sectors with

heightened risk to climate change as elevated sectors. However, in each sector there are a range of vulnerabilities, meaning not all of

our clients in these sectors have high emissions, and accordingly should not be interpreted as an indicator of relative carbon intensity.

Residential Real Estate exposures are also included in this table. Barclays recognises Residential Real Estate portfolio as elevated risk,

therefore on that basis they have been included in the table. The sectors highlighted blue in the table represent the sectors considered

as elevated at the Group level.

|  |  |
| --- | --- |
|  |  |
|  | |
| Elevated risk sector | Example drivers of risk |
| Aviation | More stringent air emission and carbon regulations, requiring high levels of capital investment and Research &  Development (R&D) expenditure. Vulnerable to shift in consumer preferences. |
| Automotive | Policy pressure to cut emissions to meet emission requirements, requiring high levels of capital investment and R&D  expenditure. Phase out of fossil fuel vehicles and introduction of low emission zones in city centres. |
| Cement | Being one of the hard to abate sectors, policy pressure to cut emissions requires high levels of capital investment and R&D  expenditure. |
| Coal Mining and Coal  Terminals | Reduction in demand of thermal coal, as utilities transition away from fossil fuel. More stringent air emissions regulation,  resulting in higher levels of capital investment. |
| Chemicals | Technological advances in low-carbon and sustainable alternatives along with  new and more stringent environmental  regulations, including carbon tax. The increasing efforts to eliminate single-use plastics and improve recycling to prevent  marine pollution could also impact demand for products used in plastic manufacture. |
| Mining (including  diversified miners) | Rising costs as a result of tighter environmental regulations and increasing water stress, vulnerable to litigation cases and  reputational damage. |
| Oil and Gas | Policy pressure to cut emissions, exposure to carbon taxes and overall increasing environmental regulation of operations  and restrictions on access to new resources. Over time, falling demand for fossil fuels. |
| Power Utilities | Policy pressure to cut emissions and move to renewable sources of energy, leading to increased capital expenditure costs,  plus potential exposure to carbon taxes. |
| Agriculture | Evolving taxation on emissions may impact production methods, supply chain and farm viability. Reduced demand for meat  and dairy as a consequence of shifts in consumer behaviour. Volatile weather conditions and extreme weather events may  impact farm credit quality |
| Residential Real Estate | Evolving minimum energy efficiency requirements and increasing physical risks from flood, subsidence and coastal erosion  have the potential to impact house prices and homeowner affordability. |
| Shipping | More stringent carbon tax regulations and policy pressure to cut emissions and adopt low-emission fuels, requiring higher  levels of R&D expenditure and capital investment. |
| Steel | Being an energy-intensive sector, the sector is exposed to the policy pressure to cut emissions and evolving air pollution  regulation . |
| Road Haulage | Policy pressure to cut emissions, requiring high levels of capital investment. |

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|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Climate risk | | | | | | | | | | |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| Carbon-related assets (Incl. sub-sector breakdown)1,2 | | | | | | | |
|  | 2023 | | | 2022 | | |  |
| £m | | | £m | | |  |
| Loans &  advances3 | Loan  commitments4 | Total | Loans &  advances 3 | Loan  commitments 4 | Total | % Change |
| Agriculture, Food and Forest Products (logging) | 3,597 | 914 | 4,511 | 3,762 | 822 | 4,584 | (2)% |
| Agriculture | 3,597 | 914 | 4,511 | 3,762 | 822 | 4,584 |  |
| Energy & Waters | 1,019 | 13,141 | 14,160 | 2,536 | 13,463 | 15,999 | (11)% |
| Power Utilities | 948 | 13,049 | 13,997 | 2,481 | 13,318 | 15,799 |  |
| Metals (waste & recycling) | 71 | 92 | 163 | 55 | 145 | 200 |  |
| Manufacturing | 6,030 | 31,449 | 37,479 | 6,773 | 32,161 | 38,934 | (4)% |
| Automotive | 858 | 5,691 | 6,549 | 968 | 5,493 | 6,461 |  |
| Cements | 161 | 381 | 542 | 222 | 160 | 382 |  |
| Chemicals | 372 | 3,947 | 4,319 | 474 | 4,223 | 4,697 |  |
| Food, Bev and Tobacco | 962 | 5,705 | 6,667 | 908 | 6,111 | 7,019 |  |
| Manufacturing - Others | 3,118 | 12,710 | 15,828 | 3,537 | 13,180 | 16,717 |  |
| Metals | 157 | 408 | 565 | 261 | 479 | 740 |  |
| Oil and Gas (refining) | 60 | 1,411 | 1,471 | 100 | 1,375 | 1,475 |  |
| Packaging Manufacturers: Metal, Glass and Plastics | 113 | 303 | 416 | 95 | 314 | 409 |  |
| Paper and Forest Products (excluding logging) | 186 | 748 | 934 | 168 | 642 | 810 |  |
| Steel | 43 | 145 | 188 | 40 | 184 | 224 |  |
| Materials and Building | 23,650 | 10,640 | 34,290 | 25,024 | 10,980 | 36,004 | (5)% |
| Construction and Materials | 452 | 641 | 1,093 | 802 | 752 | 1,554 |  |
| Homebuilding and Property Development | 3,272 | 2,247 | 5,519 | 3,521 | 2,126 | 5,647 |  |
| Real Estate Management and Development | 19,926 | 7,752 | 27,678 | 20,701 | 8,102 | 28,803 |  |
| Mining and Quarrying | 1,714 | 8,370 | 10,084 | 1,528 | 8,759 | 10,287 | (2)% |
| Mining (incl. diversified miners)5 | 221 | 1,705 | 1,926 | 201 | 2,262 | 2,463 |  |
| Oil and Gas (extraction) | 1,493 | 6,665 | 8,158 | 1,327 | 6,497 | 7,824 |  |
| Transport & storage | 1,869 | 7,139 | 9,008 | 2,297 | 7,012 | 9,309 | (3)% |
| Aviation | 262 | 2,349 | 2,611 | 465 | 2,221 | 2,686 |  |
| Oil and Gas (midstream) | 328 | 2,187 | 2,515 | 328 | 2,426 | 2,754 |  |
| Other Transport Services | 687 | 1,263 | 1,950 | 647 | 1,166 | 1,813 |  |
| Ports | 75 | 124 | 199 | 95 | 87 | 182 |  |
| Road Haulage | 398 | 417 | 815 | 453 | 429 | 882 |  |
| Shipping | 119 | 799 | 918 | 309 | 683 | 992 |  |
| Wholesale and Retail Distribution and Leisure | 1,628 | 5,417 | 7,045 | 2,554 | 4,326 | 6,880 | 2% |
| Oil and Gas (wholesale) | 375 | 2,139 | 2,514 | 995 | 1,615 | 2,610 |  |
| Others | 1,253 | 3,278 | 4,531 | 1,559 | 2,711 | 4,270 |  |
| Other Financial Institutions | 515 | 1,726 | 2,241 | 941 | 2,853 | 3,794 | (41)% |
| Real Estate Management and Development (REITs) | 515 | 1,726 | 2,241 | 941 | 2,853 | 3,794 |  |
| Home Loans | 171,512 | 8,226 | 179,738 | 173,770 | 12,170 | 185,940 | (3)% |
| Residential Real Estate | 171,512 | 8,226 | 179,738 | 173,770 | 12,170 | 185,940 |  |
| Subtotal (Elevated risk sectors) | 180,747 | 50,025 | 230,772 | 185,895 | 53,878 | 239,773 | (4)% |
| Carbon-related assets Grand total | 211,534 | 87,022 | 298,556 | 219,185 | 92,546 | 311,731 | (4)% |
|  |  |  |  |  |  |  |  |
| Total Loans & Advances  & Loan Commitments | 399,496 | 375,234 | 774,730 | 398,779 | 382,037 | 780,816 | (1)% |
|  |  |  |  |  |  |  |  |
| Carbon-related assets / Total Loans & Advances  and Loan Commitments | 53% | 23% | 39% | 55% | 24% | 40% |  |
|  |  |  |  |  |  |  |  |
| Sub-total of sectors spanning in multiple  industries |  |  |  |  |  |  |  |
| Oil and Gas | 2,256 | 12,402 | 14,658 | 2,750 | 11,913 | 14,663 | 0% |

Notes

1 The sectors have been represented  based on the standard nomenclature of economic activities (NACE codes) this year. These sector headings are consistent across our disclosures

on credit risk concentration by industry for contractual maturity, staging and geography (page [320](#i4be61753b7f243b19551b0bfbf3a2a0d_724)). The prior year comparatives have been represented in line with the updated sector

headings.

2 As industries decarbonise, sectors will increasingly include both carbon and non-carbon related activities e.g. Power Utilities will also include, in part, their generation capacity from

renewable energy sources.

3 Loans & advances includes debt securities at amortised cost amounting to £56,789m (2022: £45,487m) of which carbon related assets are £2,906m (2022: £3,482m). These carbon

related assets comprises £2,643m (2022: £3,406m) in Material & Buildings, £238m (2022: £74m) in Transport and storage and £25m (2022: £2m) in Energy and water.

4 Loan commitments excludes the fair value exposures  of £15,203m in 2023 (2022: £13,471m).

5 Diversified miners with minority interests in thermal coal mining are included in this category.

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| Risk performance - Climate risk (continued) | | | | | | | | | | |

Credit exposure to nature priority sectors

For the first time we disclose credit exposure to sectors defined by TNFD in its Additional Guidance for Financial Institutions as “Nature

priority sectors” which we note is a core TNFD metric for banks under the TNFD disclosure framework published in September 2023. As

part of our efforts to calculate and disclose this metric, we have mapped the industry codes provided by TNFD to Barclays  Industry

classifications.  The monitoring and reporting of our exposures to these TNFD identified nature priority sectors will continue to evolve in

line with approaches taken to nature-related risk management and as the list of priority sectors set out in the TNFD Guidance for

Financial Institutions is updated and as such, are subject to change in future.  Nature-related risks within a sector may vary substantially

according to company and project.

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| Credit exposures to nature priority sectors 1, 2 | |  |  |  |  |  |  |
|  | 2023 | | | 2022 | | |  |
|  | (£m) | | | (£m) | | |  |
|  | Loans & advances3 | Loan  commitments4 | Total | Loans & advances3 | Loan  commitments⁴ | Total | % change |
| Agriculture | 3,597 | 914 | 4,511 | 3,762 | 822 | 4,584 | (2%) |
| Food, Bev and Tobacco | 962 | 5,705 | 6,667 | 908 | 6,111 | 7,019 | (5%) |
| Paper and Forest Products | 186 | 748 | 934 | 168 | 642 | 810 | 15% |
| Oil and Gas | 2,256 | 12,402 | 14,658 | 2,750 | 11,913 | 14,663 | —% |
| Power Utilities | 948 | 13,049 | 13,997 | 2,481 | 13,318 | 15,799 | (11%) |
| Cement | 161 | 381 | 542 | 222 | 160 | 382 | 42% |
| Chemicals | 372 | 3,947 | 4,319 | 474 | 4,223 | 4,697 | (8%) |
| Construction & Materials | 452 | 641 | 1,093 | 802 | 752 | 1,554 | (30%) |
| Homebuilding and Property Development | 3,272 | 2,247 | 5,519 | 3,521 | 2,126 | 5,647 | (2%) |
| Manufacturing - Personal Care Products | 80 | 729 | 809 | 103 | 739 | 842 | (4%) |
| Manufacturing - Semiconductors and  Semiconductor Equipments | 240 | 886 | 1,126 | 121 | 1,028 | 1,149 | (2%) |
| Manufacturing - Textiles, Apparel and  Luxury Goods | 242 | 526 | 768 | 239 | 490 | 729 | 5% |
| Metals | 228 | 500 | 728 | 316 | 624 | 940 | (23%) |
| Mining (incl. diversified miners)5 | 221 | 1,705 | 1,926 | 201 | 2,262 | 2,463 | (22%) |
| Packaging manufacturers: Metal, Glass  and Plastics | 113 | 303 | 416 | 95 | 314 | 409 | 2% |
| Steel | 43 | 145 | 188 | 40 | 184 | 224 | (16%) |
| Automotive | 858 | 5,691 | 6,549 | 968 | 5,493 | 6,461 | 1% |
| Aviation | 262 | 2,349 | 2,611 | 465 | 2,221 | 2,686 | (3%) |
| Other Transport Services | 687 | 1,263 | 1,950 | 647 | 1,166 | 1,813 | 8% |
| Ports | 75 | 124 | 199 | 95 | 87 | 182 | 9% |
| Road Haulage | 398 | 417 | 815 | 453 | 429 | 882 | (8%) |
| Shipping | 119 | 799 | 918 | 309 | 683 | 992 | (7%) |
| Pharmaceuticals | 315 | 6,022 | 6,337 | 596 | 5,642 | 6,238 | 2% |
| Sewerage, Waste Collection, Treatment  and Disposal | 278 | 562 | 840 | 360 | 567 | 927 | (9%) |
| Power Utilities - Renewable | 1,889 | 1,699 | 3,588 | 754 | 1,160 | 1,914 | 87% |
| Water Utilities | 654 | 1,565 | 2,219 | 464 | 1,679 | 2,143 | 4% |
| Nature Priority Sector Assets Grand Total | 18,908 | 65,319 | 84,227 | 21,314 | 64,835 | 86,149 | (2%) |
|  |  |  |  |  |  |  |  |
| Total Loans & Advances  and Loan  Commitments | 399,496 | 375,234 | 774,730 | 398,779 | 382,037 | 780,816 | (1%) |
|  |  |  |  |  |  |  |  |
| Nature priority sectors assets / Total  loans & advances  and loan commitments | 5% | 17% | 11% | 5% | 17% | 11% |  |

Notes

1 As industries decarbonise, sectors will increasingly include both carbon and non-carbon related activities e.g. Power Utilities will also include, in part, their generation capacity from

renewable energy sources.

2 The TNFD highlights real estate development as a high-priority sector for nature. Barclays has £29,919m (2022: £32,597m)  of Loans & Advances and Loan Commitments to Real

Estate Management and Development, of which the majority is from real estate investment activity. As a result, this has been excluded from the Priority sector assets for Nature.

3 Loans & advances includes debt securities at amortised cost amounting to £56,789m (2022: £45,487m) of which nature priority sector assets are £2,906m (2022: £3,482m). These

nature priority sector assets comprises £2,643m (2022: £3,406m) in Material & Buildings, £238m (2022: £74m) in Transport and storage and £25m (2022: £2m) in Energy and water.

4 Loan commitments excludes the fair value exposures  of £15,203m in 2023 (2022: £13,471m).

5 Diversified miners with minority interests in thermal coal mining are included in this category.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 286 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Climate risk (continued) | | | | | | | | | | |

Financing

To facilitate greater understanding and transparency of our capital markets financing, we disclose the total capital raised for clients

across all sectors using data sourced from Dealogic. We have provided the  breakdown of our 2022 and 2023 financing below. We have

constructed this table based on the mapping of issuers’ industry assignment in Dealogic data and Barclays’ internal industry taxonomy

called Barclays Industry Classification (BIC). Financing volumes are reported on a manager-proceeds basis including bonds, equities,

loans and securitised bonds and no modifications have been made by Barclays. This data represents a third party view of our financing

and is subject to Dealogic’s league table methodology, which pro-rates volume across lead-managers. We are presenting the data in

this format to support transparency and comparability but it should be noted that this data is subject to further analysis and

methodological enhancements, before it is included in BlueTrack™.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Carbon-related sectors in wholesale credit (Dealogic Industry Classification)1, 2, 3 | | | |
|  | 31.12.2023 (£m) | 31.12.2022 (£m) | % Change |
| Energy & Waters | 20,329 | 27,021 | (25)% |
| Power Utilities | 20,329 | 27,021 |  |
| Manufacturing | 31,336 | 24,782 | 26% |
| Automotive | 7,333 | 3,136 |  |
| Cements | 279 | 162 |  |
| Chemicals | 2,523 | 2,241 |  |
| Food, Bev and Tobacco | 6,991 | 4,310 |  |
| Manufacturing - Others | 11,743 | 11,443 |  |
| Metals | 145 | 604 |  |
| Oil and Gas (refining) | 1,381 | 1,793 |  |
| Packaging Manufacturers: Metal, Glass and Plastics | 217 | 27 |  |
| Paper and Forest Products | 102 | 711 |  |
| Steel | 622 | 355 |  |
| Materials and Building | 3,143 | 6,668 | (53)% |
| Construction and Materials | 446 | 82 |  |
| Homebuilding and Property Development | 457 | 617 |  |
| Real Estate Management and Development | 2,240 | 5,969 |  |
| Mining and Quarrying | 2,992 | 2,527 | 18% |
| Mining (Incl. diversified miners)4 | 877 | 354 |  |
| Oil and Gas (extraction) | 2,115 | 2,173 |  |
| Transport & storage | 7,858 | 7,654 | 3% |
| Aviation | 1,797 | 1,731 |  |
| Oil and Gas (midstream) | 3,887 | 2,752 |  |
| Other Transport Services | 997 | 2,149 |  |
| Road Haulage | 202 | — |  |
| Shipping | 975 | 1,022 |  |
| Wholesale and retail distribution and leisure | 3,005 | 6,227 | (52)% |
| Oil and Gas (wholesale) | 720 | 1,193 |  |
| Others | 2,285 | 5,034 |  |
| Other Financial Institutions | 1,163 | 3,178 | (63)% |
| Real Estate Management and Development (REITs) | 1,163 | 3,178 |  |
| Carbon-related Assets Grand Total | 69,826 | 78,057 | (11)% |
|  |  |  |  |
| Capital Market Financing Total | 311,054 | 304,249 | 2% |
|  |  |  |  |
| Financing to Carbon-related Sector / Total Capital Market Financing | 22% | 26% |  |
|  |  |  |  |
| Sub-total of sectors spanning in multiple industries |  |  |  |
| Oil and Gas | 8,103 | 7,911 | 2% |

Notes

1 The sectors have been represented based on the standard nomenclature of economic activities (NACE codes) this year. These sector headings are consistent across our disclosures

on credit risk concentration by industry for contractual maturity, staging and geography (page [320](#i4be61753b7f243b19551b0bfbf3a2a0d_724)). The prior year comparatives have been represented in line with the updated sector

headings.

2 As industries decarbonise, sectors will increasingly include both carbon and non-carbon related activities e.g. the clients present within the sector exposure reported under Power

Utilities will also have part of their generation capacity from renewable energy sources, which represents a non-carbon related activity.

3 In 2022, this table was presented in USD. As it is now presented in GBP, the comparative figures have been represented.

4 Diversified miners with minority interests in thermal coal mining are included in this category.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 287 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Climate risk (continued) | | | | | | | | | | |

Subsidence: Total Volume of stock (as % of total UK

Mortgages portfolio) per risk band

Subsidence  is driven by the interplay of precipitation, temperature

and soil type factors, which result in volumetric changes to the

soil. Increased volatility in weather conditions, as a result of

climate change, contributes to the acceleration of subsidence

impacts. Some areas, particularly those with high concentrations

of clay soil (i.e. London), are more susceptible to subsidence. This

shrink-swell impact can cause localised property level impacts,

resulting in impacts to the valuation of a property, or impacts to

affordability through remediation costs and high insurance

premiums.

Barclays works with a third-party climate data provider to support

climate risk data enhancements within the UK Mortgages

portfolio. This includes the ability to map subsidence risk at a

property level granularity. The subsidence risk scoring is based on

soil properties, in particular the extent to which the soil will shrink

under hot and dry weather conditions, as well as the predicted

temperature and probability of extreme rainfall. These variables

are combined with subsidence claims per postcode to generate a

pseudo-quantitative score, where a property in class 9 is around

nine times as likely as a property in class 1 to make a subsidence

claim. A small proportion of the UK Mortgage portfolio is not

mapped to a subsidence risk score (c.5.2%). This is due either to a

lack of data coverage (i.e. the property is not covered by

underlying maps), or a lack of certainty in address matching.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| As at 30 September 2023 | | |
| Risk Band | Qualitative Risk  Score | Volume % |
| 0 | No Subsidence Risk | 0.01 |
| 1 | Low | 9.51 |
| 2 | 35.96 |
| 3 | 23.54 |
| 4 | Moderate | 4.71 |
| 5 | 4.72 |
| 6 | 3.36 |
| 7 | High | 2.41 |
| 8 | 0 |
| 9 | 0.25 |
| 10 | Very High | 5.43 |
| 11 | 0 |
| 12 | 2.64 |
| 13 | 0 |
| 14 | 0 |
| 15 | 2.26 |
| Missing |  | 5.2 |

Note

Data collected from 3rd party source based on one quarter lag. 30 September 2023 closest

available dataset.

Flood: Total Volume of stock (as % of total UK Mortgages

portfolio) per risk band

Flooding in the UK is forecast to increase over time, with the

potential for this increase to accelerate if greenhouse gas

emissions are not reduced. The increased risk of flooding has the

potential to impact the valuation of properties directly, as well as

indirectly where a particular area becomes high risk and property

demand falls. Remediation costs, high insurance premiums or

potential lack of insurance coverage have the potential to impact

affordability.

Barclays works with a third-party climate data provider to support

climate risk data enhancements within the UK Mortgages

portfolio. This has enabled Barclays to move from postcode level

to property level flood data granularity. Flood Risk bands are based

on average annual loss,  generated using flood hazard frequency

and flood depth from tidal, surface, pluvial and fluvial flooding and

accounting for the mitigating impact of flood defences where

these are present. Properties in the Moderate and High Risk bands

are expected to face above average insurance costs given their

elevated exposure to flood risk. Those within the Very High band

are considered likely to be eligible for Flood Re (a subsidised flood

insurance scheme).

|  |  |
| --- | --- |
|  |  |
| As at 30 September 2023 | |
| Risk Band | Volume % |
| Negligible | 81.3 |
| Very Low | 7.6 |
| Low | 1.8 |
| Moderate | 1.6 |
| High | 2.6 |
| Very High | 1.2 |
| Missing | 3.9 |

Note

Data collected from 3rd party source based on one quarter lag. 30 September 2023 closest

available dataset.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 288 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Climate risk (continued) | | | | | | | | | | |

Flood: Very High & High Flood Risk Exposure per region (as % of Total Regional Exposure)

The map below represents the proportion of properties within the UK Mortgages portfolio at High and Very High risk of flood per region

as a percentage of the total regional exposure (excluding Kensington Mortgage Company originated properties). The flood metrics are

presented on present day risk levels and are based on average annual loss, generated using flood hazard frequency and flood depth

from tidal, surface, pluvial and fluvial flooding and accounting for the mitigating impact of flood defences where these are present. The

mapping covers c.95% of the UK Mortgages portfolio on a total exposure basis - the remaining c.5% of properties are not currently

mapped to flood risk ratings on a property level basis as a result of a lack of data coverage (i.e. the property is not covered by underlying

maps), or a lack of certainty in address matching.

![Flood Map AdobeStock_616673039.png]()

Darker shades indicate higher proportion of high or very high flood risk exposure

High and Very High Flood Risk are shown as % of regional exposure

Note

Data collected from third party source based on one quarter lag. 30 September 2023 closest available dataset.

Business Banking - Dairy & Cattle Exposure

The transition risk in the Business Banking portfolio is assessed via the percentage Dairy & Cattle lending of the Business Banking

Agriculture portfolio. Given methane’s global warming potential the Dairy & Cattle sector is a significant contributor to the UK’s

emissions footprint and is therefore susceptible to the transition risks of climate change, namely consumer preference changes and

potential emissions taxation.

Barclays utilises exposure data to identify what proportion of the Business Banking  Agriculture portfolio consists of lending to Dairy

& Cattle clients.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 289 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Climate risk (continued) | | | | | | | | | | |

|  |
| --- |
|  |
| N. Ireland  % of Total Lending: 0.9%  of which:  – High: 1.4%  – Very High: 0.7% |
| North West  % of Total Lending: 5.8%  of which:  – High: 2.9%  – Very High: 1.8% |
| Wales  % of Total Lending: 2.2%  of which:  – High: 2.4%  – Very High: 0.7% |
| West Midlands  % of Total Lending: 5.0%  of which:  – High: 1.6%  – Very High: 0.6% |
| South West  % of Total Lending: 6.3%  of which:  – High: 2.5%  – Very High: 1.0% |

|  |
| --- |
|  |
| Scotland  % of Total Lending: 3.5%  of which:  – High: 2.0%  – Very High: 1.0% |
| North East  % of Total  Lending: 1.9%  of which:  – High: 1.3%  – Very High: 0.7% |
| Yorks & the Humber  % of Total Lending: 3.9%  of which:  – High: 2.4%  – Very High: 1.4% |
| East Midlands  % of Total Lending: 4.3%  of which:  – High: 2.9%  – Very High: 2.6% |
| East of England  % of Total Lending: 12.2%  of which:  – High: 2.6%  – Very High: 0.9% |
| London  % of Total Lending: 33.2%  Of which  – High: 2.8%  – Very High: 0.7% |
| South East  % of Total Lending: 20.8%  of which:  – High: 3.1%  – Very High: 1.1 % |

|  |
| --- |
|  |
| % of Total Lending  – High: 2.7%  – Very High: 1.0% |

EPC: Total Volume of stock (as % of total UK Mortgages portfolio) per EPC rating

The transition risk in the UK Mortgages portfolio is assessed via the distribution of EPC ratings across the portfolio. One of the levers to

decarbonise the UK housing stock for the UK Government is to tighten energy efficiency requirements. It is anticipated that any

tightening of minimum energy efficiency standards (MEES) will focus initially on buy-to-let properties. Buy-to-Let properties which are

privately rented are currently required to have a minimum EPC rating of E. The transition risk identified has the potential to impact the

valuation of properties directly, alongside impacting affordability as properties which fall under MEES may no longer be able to be rented

out or the landlord may need to pay for retrofitting to be brought up to standard.

EPC ratings range from A (most efficient) to G (least efficient). EPC ratings are used as the basis for assessing expected energy costs

but do not give a precise picture of emission intensity. The UK Mortgages portfolio is mapped to the Government EPC Register.

Properties may not feature on the Government EPC Register as some properties may have never been required to have an EPC rating

(not been sold or rented out since 2007), their EPC rating may have expired (EPC ratings are valid for 10 years) or the property may be in

Scotland or Northern Ireland (which use separate databases). Whilst Barclays’ proportion of ‘missing EPC ratings’ has declined year on

year, the issue of missing EPC ratings is prevalent across the industry.

EPC: Residential & Buy-to-let balances and volumes per EPC rating as at September 2023

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| EPC Rating | Residential Balances (£m) | Balance as % of  Residential Mortgages  portfolio | Volume as % of  Residential Mortgages  portfolio | Buy-to-Let Balances (£m) | Balance as % of Buy-to-  Let Mortgages portfolio | Volume as % of Buy-to-  Let Mortgages portfolio |
|  | £m | % | % | £m | % | % |
| A | 487 | 0.3 | 0.2 | 20 | 0.1 | 0.1 |
| B | 22,514 | 15.8 | 14.3 | 2,144 | 10.7 | 8.9 |
| C | 24,954 | 17.5 | 16.6 | 5,781 | 28.9 | 29.6 |
| D | 41,575 | 29.3 | 26.4 | 6,842 | 34.3 | 34.4 |
| E | 17,546 | 12.3 | 10.2 | 1,991 | 10.0 | 10.1 |
| F | 4,132 | 2.9 | 2.2 | 129 | 0.6 | 0.7 |
| G | 780 | 0.5 | 0.4 | 31 | 0.2 | 0.2 |
| Missing | 30,528 | 21.4 | 29.7 | 3,033 | 15.2 | 16.0 |
| Total | 142,516 | 100 | 100 | 19,971 | 100 | 100 |

Note

1 Data matching provided by 3rd party source based on one quarter lag, 30 September 2023 closest available dataset - EPC monitoring based on Sept-23 portfolio and Sept-23

Government EPC Register. If no valid EPC is mapped, the expired EPC (where available) is included as a proxy.

EPC: Residential & Buy-to-let balances and volumes per EPC rating as at September 2022

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| EPC Rating | Residential Balances (£m) | Balance as % of  Residential Mortgages  portfolio | Volume as % of  Residential Mortgages  portfolio | Buy-to-Let Balances (£m) | Balance as % of Buy-to-  Let Mortgages portfolio | Volume as % of Buy-to-  Let Mortgages portfolio |
|  | £m | % | % | £m | % | % |
| A | 341 | 0.2 | 0.2 | 17 | 0.1 | 0.1 |
| B | 18,913 | 13.5 | 12.0 | 1966 | 9.6 | 8.1 |
| C | 21,585 | 15.4 | 14.5 | 5053 | 24.6 | 25.6 |
| D | 38,179 | 27.3 | 24.5 | 6445 | 31.5 | 32.2 |
| E | 17,022 | 12.1 | 9.7 | 2066 | 10.1 | 10.2 |
| F | 4,118 | 2.9 | 2.1 | 157 | 0.8 | 0.8 |
| G | 746 | 0.5 | 0.4 | 36 | 0.2 | 0.2 |
| Missing | 39,458 | 28.1 | 36.5 | 4716 | 23.1 | 22.8 |
| Total | 140,362 | 100 | 100 | 20456 | 100 | 100 |

Note

1 Data matching provided by 3rd party source based on one quarter lag, 30 September 2022 closest available dataset - EPC monitoring based on Sept-22 portfolio and Sept-22

Government EPC Register.  If no valid EPC is mapped, the expired EPC (where available) is included as a proxy.

|  |  |  |  |  |  |  |  |  |  |  |
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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 290 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Climate risk (continued) | | | | | | | | | | |

#### Credit risk

Credit risk: summary of contents

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  | Page |
| Credit risk represents a significant risk and mainly arises  from exposure to loans and advances together with the  counterparty credit risk arising from derivative contracts  entered into with clients. | Credit risk overview and summary of performance | [292](#i4be61753b7f243b19551b0bfbf3a2a0d_19433) |
| Maximum exposure and effects of netting, collateral and risk  transfer | [293](#i4be61753b7f243b19551b0bfbf3a2a0d_709) |
| This section outlines the expected credit loss allowances,  the movements in allowances during the period, material  management adjustments to model output and  measurement uncertainty and sensitivity analysis. | Expected Credit Losses | [295](#i4be61753b7f243b19551b0bfbf3a2a0d_712) |
| – Loans and advances at amortised cost by geography | [295](#ic96f2cbfd3d44b93a2a8c677fd4bf246_5395) |
| – Loans and advances at amortised cost by product | [297](#ic96f2cbfd3d44b93a2a8c677fd4bf246_5392) |
| – Movement in gross exposure and impairment allowance  including provisions for loan commitments and financial  guarantees | [298](#i4be61753b7f243b19551b0bfbf3a2a0d_715) |
| – Stage 2 decomposition | [305](#i4be61753b7f243b19551b0bfbf3a2a0d_14256) |
| – Stage 3 decomposition | [306](#i4be61753b7f243b19551b0bfbf3a2a0d_14329) |
| Management adjustments to models for impairment | [307](#i4be61753b7f243b19551b0bfbf3a2a0d_718) |
| Measurement uncertainty and sensitivity analysis | [311](#i4be61753b7f243b19551b0bfbf3a2a0d_721) |
| The Group reviews and monitors risk concentrations in a  variety of ways. This section outlines performance against  key concentration risks. | Analysis of the concentration of credit risk | [320](#i4be61753b7f243b19551b0bfbf3a2a0d_724) |
| – Credit risk concentration by Industry for contractual maturity,  staging and geography | [320](#i4be61753b7f243b19551b0bfbf3a2a0d_724) |
| Approach to management and representation of credit quality | [322](#i4be61753b7f243b19551b0bfbf3a2a0d_727) |
| – Asset credit quality | [322](#ie81809e0cab54392ad97b4e6e552248f_3509) |
| – Debt securities | [322](#ie81809e0cab54392ad97b4e6e552248f_3515) |
| – Balance sheet credit quality | [323](#ie81809e0cab54392ad97b4e6e552248f_3510) |
| – Credit exposures by internal PD grade | [325](#i4be61753b7f243b19551b0bfbf3a2a0d_12271) |
| Credit risk monitors exposure performance across a range  of significant portfolios. | Analysis of specific portfolios and asset types | [329](#i4be61753b7f243b19551b0bfbf3a2a0d_730) |
| – Secured home loans | [329](#iacfdd40500fa4a5ab6f76f169b4fbc46_1906) |
| – Retail Credit cards and Retail Other | [331](#i070485a2b40e4dcba95f72f1d339d2b7_27402) |
| The Group monitors exposures to assets where there is a  heightened likelihood of default and assets where an actual  default has occurred. From time to time, suspension of  certain aspects of client credit agreements are agreed,  generally during temporary periods of financial difficulties  where the Group is confident that the client will be able to  remedy the suspension. This section outlines the current  exposure to assets with this treatment. | Forbearance | [332](#i992e306d544846d5aa816c5b00936055_3792) |
| – Retail forbearance programmes | [333](#i992e306d544846d5aa816c5b00936055_3793) |
| – Wholesale forbearance programmes | [334](#i992e306d544846d5aa816c5b00936055_3794) |
|  | |
|  | | |
|  | | |
| This section provides an analysis of credit risk on debt  securities and derivatives. | Analysis of debt securities | [334](#i992e306d544846d5aa816c5b00936055_3795) |
| Analysis of derivatives | [335](#i992e306d544846d5aa816c5b00936055_3796) |

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| Risk performance - Credit risk | | | | | | | | | | |

Credit risk

All disclosures in this section are unaudited

unless otherwise stated.

Overview

Credit risk represents a significant risk to

the Group and mainly arises from exposure

to loans and advances together with the

counterparty credit risk arising from

derivative contracts entered with clients.

Credit risk disclosures exclude other

financial assets not subject to credit risk,

mainly equity securities. For off-balance

sheet exposures certain contingent

liabilities not subject to credit risk such as

performance guarantees are excluded.

Task force on Disclosure about Expected

Credit Losses (DECL)

Credit risk disclosures have been enhanced

to include DECL III recommendations for

minimum product grouping and

geographical breakdown for this period and

prior period comparatives have been

aligned.

Summary of performance in the

period

Gross exposure

Gross loans and advances at amortised

cost to customers and banks have

remained broadly stable at £405b n, which

includes increase in debt securities driven

by Treasury investments and strategic

acquisitions in Home Finance. This is offset

by a reduction due to the German

consumer finance business classified as

assets held for sale and foreign exchange

movements in Corporate & Investment

Bank (CIB) and US Cards portfolio.

Maximum exposure

The Group’s net exposure to credit risk is

broadly stable at £1,030bn (2022:

£1,033bn). Overall, the extent to which the

mitigation is held against its total exposure

has decreased to 42% (2022: 44%)

primarily due to decrease in derivative

financial instruments (£46bn) and reverse

repurchase agreements (£14bn), both of

which are highly secured instruments.

Credit quality

Delinquencies are broadly stable across the

group with an increase observed in US

cards, which was anticipated. A range of

activities are in place to protect our existing

defensive positioning against current

macroeconomic headwinds.

Corporate loans portfolio benefited from

high-quality exposure and credit

protection.

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| --- | --- |
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| + | Further analysis on the credit quality of assets is  presented in the approach to management and  representation of credit quality section. |
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Stage Decomposition

A net decrease of £3.2bn is observed in

Stage 2 gross exposure driven by an

improved GDP forecast and higher

repayments in Corporate loans partially

offset by an increase in retail lending

following resumption of more regular spend

activity and higher interest rates.

Stage 3 balances have increased to £7.2bn

(2022: £7.1bn) driven by higher

delinquencies in US cards partially offset by

repayments in Business Banking.

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| --- | --- |
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| + | Refer to pages [305](#i4be61753b7f243b19551b0bfbf3a2a0d_14256)  to  [306](#i4be61753b7f243b19551b0bfbf3a2a0d_14329)  for further details. |
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Scenario

Economic uncertainty continues, linked to

higher interest rates and ongoing

inflationary pressures in major economies.

For Q423, macroeconomic scenarios have

been refreshed and are designed around a

broad range of economic outcomes. The

Downside 2 (DS2) scenario has been

aligned to Barclays 2023 Internal Stress

Test (IST23) which is less severe in terms of

GDP deterioration, resulting in increased

DS2 weights.

ECL

Impairment allowances on loans and

advances at amortised cost including off-

balance sheet has increased to £6,252m

(2022:£6,175m) predominantly driven  by

increase in US cards partially offset by a

reduction due to the German consumer

finance business classified as assets held

for sale. On-balance sheet coverage has

remained strong and stable at  1.4%.

Charge

Credit impairment charges were £1,881m

(2022: £1,220m), reflecting an increase in

delinquencies in US cards, which was

anticipated, and led to higher coverage in

CC&P.

Management Adjustments

Economic uncertainty adjustments have

decreased to £198m (2022: £317m). The

reduction is informed by the rebuild of

certain impairment models which better

capture the macroeconomic outlook.

Furthermore, adjustments have been

reassessed to capture affordability

headwinds in UK retail lending.

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| --- | --- |
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| + | Refer to the Management adjustment to models for  impairment section on page  [307](#i632b577e07d64310a2f854d61cf30c80_5960)  for further details. |
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Climate

Barclays has performed a credit risk

assessment of physical and transition risk

due to climate change. This was delivered

through a combination of a scenario

approach and targeted reviews on specific

portfolios identified as more susceptible to

climate risk. The analysis did not result in a

separately identifiable impairment charge

for year end 2023 reporting.

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| --- | --- |
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| + | Further detail can be found in the Financial  statements section in Note 8 Credit impairment  charges/(releases). Description of terminology can  be found in the glossary, available at  [home.barclays/annualreport](https://home.barclays/investor-relations/reports-and-events/annual-reports/) . |
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| + | Refer to [credit risk management](#i4be61753b7f243b19551b0bfbf3a2a0d_664)  section  for the  details of governance, policies and procedures. |
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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Maximum exposure and effects of netting, collateral and risk transfer

The following tables present a reconciliation between the Group's maximum exposure and its net exposure to credit risk, reflecting the

financial effects of risk mitigation reducing the Group's exposure.

The Group mitigates the credit risk to which it is exposed through netting and set-off, collateral and risk transfer. Further detail on the

Group’s policies to each of these forms of credit enhancement is presented on pages 131 to 134 of the Barclays PLC Pillar 3 Report

2023 (unaudited).

Collateral obtained

Where collateral has been obtained in the event of default, the Group does not, ordinarily, use such assets for its own operations and

they are usually sold on a timely basis. The carrying value of assets held by the Group as at 31 December 2023, as a result of the

enforcement of collateral, was £6m ( 2022: £31m).

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| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Maximum exposure and effects of netting, collateral and risk transfer (audited) | | | |  |  |  |
|  | Maximum  exposure | Netting and  set-off | Cash  collateral | Non-cash  collateral | Risk transfer | Exposure net  of risk  mitigation |
| As at 31 December 2023 | £m | £m | £m | £m | £m | £m |
| On-balance sheet: |  |  |  |  |  |  |
| Cash and balances at central banks | 224,634 | — | — | — | — | 224,634 |
| Cash collateral and settlement balances | 108,889 | — | — | — | — | 108,889 |
| Loans and advances at amortised cost: |  |  |  |  |  |  |
| Retail mortgages | 171,512 | — | (13) | (171,484) | — | 15 |
| Retail credit cards | 34,221 | — | — | — | — | 34,221 |
| Retail other | 9,952 | — | (1,028) | (2,329) | (39) | 6,556 |
| Corporate loans | 127,062 | (3,876) | (1,117) | (61,892) | (14,716) | 45,461 |
| Total loans and advances at amortised cost | 342,747 | (3,876) | (2,158) | (235,705) | (14,755) | 86,253 |
| Of which credit-impaired (Stage 3): |  |  |  |  |  |  |
| Retail mortgages | 1,996 | — | — | (1,994) | — | 2 |
| Retail credit cards | 387 | — | — | — | — | 387 |
| Retail other | 317 | — | (23) | (263) | — | 31 |
| Corporate loans | 1,956 | — | (4) | (1,098) | (546) | 308 |
| Total credit-impaired loans and advances at amortised cost | 4,656 | — | (27) | (3,355) | (546) | 728 |
| Debt securities at amortised cost | 56,749 | — | — | (956) | (156) | 55,637 |
| Reverse repurchase agreements and other similar secured lending | 2,594 | — | — | (2,594) | — | — |
| Trading portfolio assets: |  |  |  |  |  |  |
| Debt securities | 75,498 | — | — | (521) | — | 74,977 |
| Traded loans | 12,653 | — | — | (189) | — | 12,464 |
| Total trading portfolio assets | 88,151 | — | — | (710) | — | 87,441 |
| Financial assets at fair value through the income statement: |  |  |  |  |  |  |
| Loans and advances | 47,639 | — | (47) | (41,334) | (4) | 6,254 |
| Debt securities | 2,586 | — | — | (221) | — | 2,365 |
| Reverse repurchase agreements | 149,131 | — | (3,416) | (145,292) | — | 423 |
| Other financial assets | 110 | — | — | — | — | 110 |
| Total financial assets at fair value through the income statement | 199,466 | — | (3,463) | (186,847) | (4) | 9,152 |
| Derivative financial instruments | 256,836 | (198,809) | (31,211) | (10,036) | (3,791) | 12,989 |
| Financial assets at fair value through other comprehensive income | 71,830 | — | — | (362) | (198) | 71,270 |
| Other assets | 2,197 | — | (1) | — | — | 2,196 |
| Assets held for sale | 3,855 | — | — | — | — | 3,855 |
| Total on-balance sheet | 1,357,948 | (202,685) | (36,833) | (437,210) | (18,904) | 662,316 |
|  |  |  |  |  |  |  |
| Off-balance sheet: |  |  |  |  |  |  |
| Contingent liabilities | 25,340 | — | (2,225) | (358) | (283) | 22,474 |
| Loan commitments | 390,437 | — | (1,506) | (41,862) | (1,773) | 345,296 |
| Total off-balance sheet | 415,777 | — | (3,731) | (42,220) | (2,056) | 367,770 |
|  |  |  |  |  |  |  |
| Total | 1,773,725 | (202,685) | (40,564) | (479,430) | (20,960) | 1,030,086 |

Off-balance sheet exposures are shown gross of provisions of  £504m (2022: £583m). See Note 24  for further details. In addition to the

above, the Group holds forward starting reverse repos with notional contract amounts of £54.3bn ( 2022: £48.4bn). These balances are

fully collateralised. Corporate loans at amortised cost  include  £5.3bn (2022: £8bn) of BBLS, CBILS and CLBILS supported by UK

government guarantees of £5.1bn (2022: £7.6bn), which are included within the Risk transfer column in the table. For further

information on credit risk mitigation techniques, refer to the Credit risk management section. Loan commitments reported also include

exposures relating to financial assets classified as assets held for sale.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

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| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Maximum exposure and effects of netting, collateral and risk transfer (audited) | | | |  |  |  |
|  | Maximum  exposure | Netting and  set-off | Cash  collateral | Non-cash  collateral | Risk transfer | Exposure net  of risk  mitigation |
| As at 31 December 2022 | £m | £m | £m | £m | £m | £m |
| On-balance sheet: |  |  |  |  |  |  |
| Cash and balances at central banks | 256,351 | — | — | — | — | 256,351 |
| Cash collateral and settlement balances | 112,597 | — | — | — | — | 112,597 |
| Loans and advances at amortised cost: |  |  |  |  |  |  |
| Retail mortgages | 173,770 | — | (328) | (173,308) | (98) | 36 |
| Retail credit cards | 34,584 | — | — | — | — | 34,584 |
| Retail other | 15,084 | — | (1,208) | (4,184) | (224) | 9,468 |
| Corporate loans | 129,854 | (4,442) | (672) | (60,617) | (17,190) | 46,933 |
| Total loans and advances at amortised cost | 353,292 | (4,442) | (2,208) | (238,109) | (17,512) | 91,021 |
| Of which credit-impaired (Stage 3): |  |  |  |  |  |  |
| Retail mortgages | 2,000 | — | (1) | (1,996) | — | 3 |
| Retail credit cards | 425 | — | — | — | — | 425 |
| Retail other | 412 | — | (32) | (323) | (3) | 54 |
| Corporate loans | 2,030 | — | (6) | (742) | (709) | 573 |
| Total credit-impaired loans and advances at amortised cost | 4,867 | — | (39) | (3,061) | (712) | 1,055 |
| Debt securities at amortised cost | 45,487 | — | — | (695) | (196) | 44,596 |
| Reverse repurchase agreements and other similar secured lending | 776 | — | — | (776) | — | — |
| Trading portfolio assets: |  |  |  |  |  |  |
| Debt securities | 55,475 | — | — | (530) | — | 54,945 |
| Traded loans | 13,198 | — | — | (250) | (48) | 12,900 |
| Total trading portfolio assets | 68,673 | — | — | (780) | (48) | 67,845 |
| Financial assets at fair value through the income statement: |  |  |  |  |  |  |
| Loans and advances | 39,429 | — | (17) | (31,544) | (9) | 7,859 |
| Debt securities | 3,249 | — | — | (321) | — | 2,928 |
| Reverse repurchase agreements | 164,681 | — | (3,672) | (160,347) | — | 662 |
| Other financial assets | 118 | — | — | — | — | 118 |
| Total financial assets at fair value through the income statement | 207,477 | — | (3,689) | (192,212) | (9) | 11,567 |
| Derivative financial instruments | 302,380 | (238,337) | (34,547) | (11,434) | (7,275) | 10,787 |
| Financial assets at fair value through other comprehensive income | 65,054 | — | — | (222) | (711) | 64,121 |
| Other assets | 1,656 | — | — | — | — | 1,656 |
| Assets held for sale | — | — | — | — | — | — |
| Total on-balance sheet | 1,413,743 | (242,779) | (40,444) | (444,228) | (25,751) | 660,541 |
|  |  |  |  |  |  |  |
| Off-balance sheet: |  |  |  |  |  |  |
| Contingent liabilities | 24,205 | — | (1,295) | (1,596) | (280) | 21,034 |
| Loan commitments | 395,508 | — | (129) | (41,917) | (1,666) | 351,796 |
| Total off-balance sheet | 419,713 | — | (1,424) | (43,513) | (1,946) | 372,830 |
|  |  |  |  |  |  |  |
| Total | 1,833,456 | (242,779) | (41,868) | (487,741) | (27,697) | 1,033,371 |

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Expected Credit Losses

Loans  and advances at amortised cost by geography

Total loans and advances at amortised cost in the credit risk performance section includes loans and advances at amortised cost to

banks and loans and advances at amortised cost to customers.

The table below presents a product and geographical breakdown by stages of loans and advances at amortised cost. Also included are

stage allocation of debt securities and off-balance sheet loan commitments and financial guarantee contracts by gross exposure,

impairment allowance and coverage ratio as at 31 December 2023.

Impairment allowance under IFRS 9 considers both the drawn and the undrawn counterparty exposure. For retail portfolios, the total

impairment allowance is allocated to gross loans and advances to the extent allowance does not exceed the drawn exposure and any

excess is reported on the liabilities side of the balance sheet as a provision. For corporate portfolios, impairment allowance on undrawn

exposure is reported on the liability side of the balance sheet as a provision.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
| Loans and advances at amortised cost by geography (audited) | | | | | | | | | |
|  | Gross exposure | | | |  | Impairment allowance | | | |
|  | Stage 1 | Stage 2 | Stage 3 | Total |  | Stage 1 | Stage 2 | Stage 3 | Total |
| As at 31 December 2023 | £m | £m | £m | £m |  | £m | £m | £m | £m |
| Retail mortgages | 146,001 | 19,123 | 1,812 | 166,936 |  | 43 | 77 | 112 | 232 |
| Retail credit cards | 8,094 | 2,128 | 198 | 10,420 |  | 111 | 492 | 107 | 710 |
| Retail other | 6,832 | 1,252 | 264 | 8,348 |  | 56 | 117 | 144 | 317 |
| Corporate loans1 | 54,257 | 8,673 | 1,692 | 64,622 |  | 191 | 214 | 346 | 751 |
| Total UK | 215,184 | 31,176 | 3,966 | 250,326 |  | 401 | 900 | 709 | 2,010 |
| Retail mortgages | 4,201 | 346 | 612 | 5,159 |  | 7 | 28 | 316 | 351 |
| Retail credit cards | 22,315 | 3,450 | 1,522 | 27,287 |  | 412 | 1,138 | 1,226 | 2,776 |
| Retail other | 1,637 | 91 | 229 | 1,957 |  | 3 | 1 | 32 | 36 |
| Corporate loans | 58,248 | 4,629 | 862 | 63,739 |  | 96 | 200 | 252 | 548 |
| Total Rest of the world | 86,401 | 8,516 | 3,225 | 98,142 |  | 518 | 1,367 | 1,826 | 3,711 |
| Total loans and advances at amortised cost | 301,585 | 39,692 | 7,191 | 348,468 |  | 919 | 2,267 | 2,535 | 5,721 |
| Debt securities at amortised cost | 52,869 | 3,907 | — | 56,776 |  | 11 | 16 | — | 27 |
| Total loans and advances at amortised cost  including debt securities | 354,454 | 43,599 | 7,191 | 405,244 |  | 930 | 2,283 | 2,535 | 5,748 |
| Off-balance sheet loan commitments and  financial guarantee contracts2 | 374,063 | 24,208 | 1,037 | 399,308 |  | 173 | 287 | 44 | 504 |
| Total3,4 | 728,517 | 67,807 | 8,228 | 804,552 |  | 1,103 | 2,570 | 2,579 | 6,252 |
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|  | Net Exposure | | | |  | Coverage ratio | | | |
|  | Stage 1 | Stage 2 | Stage 3 | Total |  | Stage 1 | Stage 2 | Stage 3 | Total |
| As at 31 December 2023 | £m | £m | £m | £m |  | % | % | % | % |
| Retail mortgages | 145,958 | 19,046 | 1,700 | 166,704 |  | — | 0.4 | 6.2 | 0.1 |
| Retail credit cards | 7,983 | 1,636 | 91 | 9,710 |  | 1.4 | 23.1 | 54.0 | 6.8 |
| Retail other | 6,776 | 1,135 | 120 | 8,031 |  | 0.8 | 9.3 | 54.5 | 3.8 |
| Corporate loans1 | 54,066 | 8,459 | 1,346 | 63,871 |  | 0.4 | 2.5 | 20.4 | 1.2 |
| Total UK | 214,783 | 30,276 | 3,257 | 248,316 |  | 0.2 | 2.9 | 17.9 | 0.8 |
| Retail mortgages | 4,194 | 318 | 296 | 4,808 |  | 0.2 | 8.1 | 51.6 | 6.8 |
| Retail credit cards | 21,903 | 2,312 | 296 | 24,511 |  | 1.8 | 33.0 | 80.6 | 10.2 |
| Retail other | 1,634 | 90 | 197 | 1,921 |  | 0.2 | 1.1 | 14.0 | 1.8 |
| Corporate loans | 58,152 | 4,429 | 610 | 63,191 |  | 0.2 | 4.3 | 29.2 | 0.9 |
| Total Rest of the world | 85,883 | 7,149 | 1,399 | 94,431 |  | 0.6 | 16.1 | 56.6 | 3.8 |
| Total loans and advances at amortised cost | 300,666 | 37,425 | 4,656 | 342,747 |  | 0.3 | 5.7 | 35.3 | 1.6 |
| Debt securities at amortised cost | 52,858 | 3,891 | — | 56,749 |  | — | 0.4 | — | — |
| Total loans and advances at amortised cost  including debt securities | 353,524 | 41,316 | 4,656 | 399,496 |  | 0.3 | 5.2 | 35.3 | 1.4 |
| Off-balance sheet loan commitments and  financial guarantee contracts2 | 373,890 | 23,921 | 993 | 398,804 |  | — | 1.2 | 4.2 | 0.1 |
| Total3, 4 | 727,414 | 65,237 | 5,649 | 798,300 |  | 0.2 | 3.8 | 31.3 | 0.8 |

Notes

1 Includes Business Banking, which has a gross exposure of £15.2bn and an impairment allowance of £431m. This comprises £99m impairment allowance on £9.8bn Stage 1 exposure,

£81m on £4.1bn Stage 2 exposure and £251m on £1.3bn Stage 3 exposure. Excluding this, total coverage for corporate loans in UK is 0.6%.

2 Excludes loan commitments and financial guarantees of £16.5bn carried at fair value and includes exposures relating to financial assets classified as assets held for sale.

3 Other financial assets subject to impairment not included in the table above include cash collateral and settlement balances, financial assets at fair value through other comprehensive

income and other assets. These have a total gross exposure of £183.6bn and impairment allowance of £151m. This comprises £16m ECL on £182.8bn Stage 1 exposure, £2m on

£0.6bn  Stage 2 exposure and £133m on £140m Stage 3 exposure.

4 The annualised loan loss rate is 46bps after applying the total impairment charge of £1,881 m.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Assets held for sale

During 2023, gross loans and advances and related impairment allowances for the German consumer finance business  were

reclassified from loans and advances to customers to assets held for sale in the balance sheet. Disclosures relating to assets held for

sale are provided in the credit risk tables, primarily where the disclosure is relevant to the measurement of these financial assets.

For further details on assets held for sale, see Note 40 to the financial statements.

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| Loans and advances to customers classified as assets held for sale | | | | | | | | | | | | | | | |
|  | Stage 1 | | |  | Stage 2 | | |  | Stage 3 | | |  | Total | | |
|  | Gross | ECL | Coverage |  | Gross | ECL | Coverage |  | Gross | ECL | Coverage |  | Gross | ECL | Coverage |
| As at 31 December 20231 | £m | £m | % |  | £m | £m | % |  | £m | £m | % |  | £m | £m | % |
| Retail credit cards | 1,621 | 15 | 0.9 |  | 445 | 41 | 9.2 |  | 92 | 68 | 73.9 |  | 2,158 | 124 | 5.7 |
| Retail other | 1,561 | 20 | 1.3 |  | 288 | 32 | 11.1 |  | 84 | 60 | 71.4 |  | 1,933 | 112 | 5.8 |
| Total Rest of the World | 3,182 | 35 | 1.1 |  | 733 | 73 | 10.0 |  | 176 | 128 | 72.7 |  | 4,091 | 236 | 5.8 |

Note

1 In 2022, total gross exposure of £4.3bn and impairment allowance of £296m was included in loans and advances at amortised cost which has now been classified as assets held for sale.

This comprises £37m ECL on £3.1bn Stage 1 exposure, £141m on £1.0bn Stage 2 exposure and £118m on £153m Stage 3 exposure.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
| Loans and advances at amortised cost by geography (audited) | | | | | | | | | |
|  | Gross exposure | | | |  | Impairment allowance | | | |
|  | Stage 1 | Stage 2 | Stage 3 | Total |  | Stage 1 | Stage 2 | Stage 3 | Total |
| As at 31 December 2022 | £m | £m | £m | £m |  | £m | £m | £m | £m |
| Retail mortgages | 145,821 | 17,735 | 1,481 | 165,037 |  | 21 | 49 | 58 | 128 |
| Retail credit cards | 7,119 | 2,569 | 251 | 9,939 |  | 127 | 493 | 137 | 757 |
| Retail other | 8,202 | 1,197 | 293 | 9,692 |  | 72 | 138 | 145 | 355 |
| Corporate loans1 | 55,187 | 12,528 | 2,008 | 69,723 |  | 317 | 264 | 360 | 941 |
| Total UK | 216,329 | 34,029 | 4,033 | 254,391 |  | 537 | 944 | 700 | 2,181 |
| Retail mortgages | 7,851 | 465 | 933 | 9,249 |  | 8 | 24 | 356 | 388 |
| Retail credit cards | 22,669 | 3,880 | 1,129 | 27,678 |  | 331 | 1,127 | 818 | 2,276 |
| Retail other | 5,268 | 271 | 427 | 5,966 |  | 28 | 28 | 163 | 219 |
| Corporate loans | 56,704 | 4,290 | 564 | 61,558 |  | 144 | 160 | 182 | 486 |
| Total Rest of the World | 92,492 | 8,906 | 3,053 | 104,451 |  | 511 | 1,339 | 1,519 | 3,369 |
| Total loans and advances at amortised cost | 308,821 | 42,935 | 7,086 | 358,842 |  | 1,048 | 2,283 | 2,219 | 5,550 |
| Debt securities at amortised cost | 41,724 | 3,805 | — | 45,529 |  | 9 | 33 | 0 | 42 |
| Total loans and advances at amortised cost  including debt securities | 350,545 | 46,740 | 7,086 | 404,371 |  | 1,057 | 2,316 | 2,219 | 5,592 |
| Off-balance sheet loan commitments and  financial guarantee contracts2 | 372,945 | 30,694 | 1,180 | 404,819 |  | 245 | 315 | 23 | 583 |
| Total3,4 | 723,490 | 77,434 | 8,266 | 809,190 |  | 1,302 | 2,631 | 2,242 | 6,175 |
|  |  |  |  |  |  |  |  |  |  |
|  | Net Exposure | | | |  | Coverage ratio | | | |
|  | Stage 1 | Stage 2 | Stage 3 | Total |  | Stage 1 | Stage 2 | Stage 3 | Total |
| As at 31 December 2022 | £m | £m | £m | £m |  | % | % | % | % |
| Retail mortgages | 145,800 | 17,686 | 1,423 | 164,909 |  | — | 0.3 | 3.9 | 0.1 |
| Retail credit cards | 6,992 | 2,076 | 114 | 9,182 |  | 1.8 | 19.2 | 54.6 | 7.6 |
| Retail other | 8,130 | 1,059 | 148 | 9,337 |  | 0.9 | 11.5 | 49.5 | 3.7 |
| Corporate loans1 | 54,870 | 12,264 | 1,648 | 68,782 |  | 0.6 | 2.1 | 17.9 | 1.3 |
| Total UK | 215,792 | 33,085 | 3,333 | 252,210 |  | 0.2 | 2.8 | 17.4 | 0.9 |
| Retail mortgages | 7,843 | 441 | 577 | 8,861 |  | 0.1 | 5.2 | 38.2 | 4.2 |
| Retail credit cards | 22,338 | 2,753 | 311 | 25,402 |  | 1.5 | 29.0 | 72.5 | 8.2 |
| Retail other | 5,240 | 243 | 264 | 5,747 |  | 0.5 | 10.3 | 38.2 | 3.7 |
| Corporate loans | 56,560 | 4,130 | 382 | 61,072 |  | 0.3 | 3.7 | 32.3 | 0.8 |
| Total Rest of the World | 91,981 | 7,567 | 1,534 | 101,082 |  | 0.6 | 15.0 | 49.8 | 3.2 |
| Total loans and advances at amortised cost | 307,773 | 40,652 | 4,867 | 353,292 |  | 0.3 | 5.3 | 31.3 | 1.5 |
| Debt securities at amortised cost | 41,715 | 3,772 | — | 45,487 |  | — | 0.9 | — | 0.1 |
| Total loans and advances at amortised cost  including debt securities | 349,488 | 44,424 | 4,867 | 398,779 |  | 0.3 | 5.0 | 31.3 | 1.4 |
| Off-balance sheet loan commitments and  financial guarantee contracts2 | 372,700 | 30,379 | 1,157 | 404,236 |  | 0.1 | 1.0 | 1.9 | 0.1 |
| Total3, 4 | 722,188 | 74,803 | 6,024 | 803,015 |  | 0.2 | 3.4 | 27.1 | 0.8 |

Notes

1 Includes Business Banking, which has a gross exposure of £18.1bn and an impairment allowance of £519m. This comprises £149m impairment allowance on £10.5bn Stage 1 exposure,

£121m on £6.0bn Stage 2 exposure and £249m on £1.6bn Stage 3 exposure. Excluding this, total coverage for corporate loans in UK is 0.8%.

2 Excludes loan commitments and financial guarantees of £14.9bn carried at fair value.

3 Other financial assets subject to impairment not included in the table above include cash collateral and settlement balances, financial assets at fair value through other comprehensive

income and other assets. These have a total gross exposure of £180.1bn and impairment allowance of £ 163m. This comprises £ 10m ECL on £178.4bn Stage 1 exposure, £ 9m on

£1.5bn Stage 2 exposure and £144m on £149m Stage 3 exposure.

4 The annualised loan loss rate is 30bps after applying the total impairment charge of £1,220m.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Loans and advances at amortised cost by product (audited)

The table below presents a product breakdown by stages of loans and advances at amortised cost. Also included is a breakdown of

Stage 2 past due balances.

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| Loans and advances at amortised cost by product (audited) | | | | | | | |
|  |  | Stage 2 | | | |  |  |
| As at 31 December 2023 | Stage 1 | Not past due | <=30 days  past due | >30 days past  due | Total | Stage 3 | Total |
| Gross exposure | £m | £m | £m | £m | £m | £m | £m |
| Retail mortgages | 150,202 | 16,834 | 1,971 | 664 | 19,469 | 2,424 | 172,095 |
| Retail credit cards | 30,409 | 4,858 | 392 | 328 | 5,578 | 1,720 | 37,707 |
| Retail other | 8,469 | 1,094 | 126 | 123 | 1,343 | 493 | 10,305 |
| Corporate loans | 112,505 | 12,960 | 179 | 163 | 13,302 | 2,554 | 128,361 |
| Total | 301,585 | 35,746 | 2,668 | 1,278 | 39,692 | 7,191 | 348,468 |
|  |  |  |  |  |  |  |  |
| Impairment allowance |  |  |  |  |  |  |  |
| Retail mortgages | 50 | 73 | 20 | 12 | 105 | 428 | 583 |
| Retail credit cards | 523 | 1,257 | 166 | 207 | 1,630 | 1,333 | 3,486 |
| Retail other | 59 | 82 | 18 | 18 | 118 | 176 | 353 |
| Corporate loans | 287 | 399 | 8 | 7 | 414 | 598 | 1,299 |
| Total | 919 | 1,811 | 212 | 244 | 2,267 | 2,535 | 5,721 |
|  |  |  |  |  |  |  |  |
| Net exposure |  |  |  |  |  |  |  |
| Retail mortgages | 150,152 | 16,761 | 1,951 | 652 | 19,364 | 1,996 | 171,512 |
| Retail credit cards | 29,886 | 3,601 | 226 | 121 | 3,948 | 387 | 34,221 |
| Retail other | 8,410 | 1,012 | 108 | 105 | 1,225 | 317 | 9,952 |
| Corporate loans | 112,218 | 12,561 | 171 | 156 | 12,888 | 1,956 | 127,062 |
| Total | 300,666 | 33,935 | 2,456 | 1,034 | 37,425 | 4,656 | 342,747 |
|  |  |  |  |  |  |  |  |
| Coverage ratio | % | % | % | % | % | % | % |
| Retail mortgages | — | 0.4 | 1.0 | 1.8 | 0.5 | 17.7 | 0.3 |
| Retail credit cards | 1.7 | 25.9 | 42.3 | 63.1 | 29.2 | 77.5 | 9.2 |
| Retail other | 0.7 | 7.5 | 14.3 | 14.6 | 8.8 | 35.7 | 3.4 |
| Corporate loans | 0.3 | 3.1 | 4.5 | 4.3 | 3.1 | 23.4 | 1.0 |
| Total | 0.3 | 5.1 | 7.9 | 19.1 | 5.7 | 35.3 | 1.6 |
|  |  |  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |  |  |
| Gross exposure | £m | £m | £m | £m | £m | £m | £m |
| Retail mortgages | 153,672 | 15,990 | 1,684 | 526 | 18,200 | 2,414 | 174,286 |
| Retail credit cards | 29,788 | 5,731 | 284 | 434 | 6,449 | 1,380 | 37,617 |
| Retail other | 13,470 | 1,232 | 104 | 132 | 1,468 | 720 | 15,658 |
| Corporate loans | 111,891 | 16,552 | 159 | 107 | 16,818 | 2,572 | 131,281 |
| Total | 308,821 | 39,505 | 2,231 | 1,199 | 42,935 | 7,086 | 358,842 |
|  |  |  |  |  |  |  |  |
| Impairment allowance |  |  |  |  |  |  |  |
| Retail mortgages | 29 | 53 | 11 | 9 | 73 | 414 | 516 |
| Retail credit cards | 458 | 1,334 | 100 | 186 | 1,620 | 955 | 3,033 |
| Retail other | 100 | 118 | 22 | 26 | 166 | 308 | 574 |
| Corporate loans | 461 | 401 | 13 | 10 | 424 | 542 | 1,427 |
| Total | 1,048 | 1,906 | 146 | 231 | 2,283 | 2,219 | 5,550 |
|  |  |  |  |  |  |  |  |
| Net exposure |  |  |  |  |  |  |  |
| Retail mortgages | 153,643 | 15,937 | 1,673 | 517 | 18,127 | 2,000 | 173,770 |
| Retail credit cards | 29,330 | 4,397 | 184 | 248 | 4,829 | 425 | 34,584 |
| Retail other | 13,370 | 1,114 | 82 | 106 | 1,302 | 412 | 15,084 |
| Corporate loans | 111,430 | 16,151 | 146 | 97 | 16,394 | 2,030 | 129,854 |
| Total | 307,773 | 37,599 | 2,085 | 968 | 40,652 | 4,867 | 353,292 |
|  |  |  |  |  |  |  |  |
| Coverage ratio | % | % | % | % | % | % | % |
| Retail mortgages | — | 0.3 | 0.7 | 1.7 | 0.4 | 17.1 | 0.3 |
| Retail credit cards | 1.5 | 23.3 | 35.2 | 42.9 | 25.1 | 69.2 | 8.1 |
| Retail other | 0.7 | 9.6 | 21.2 | 19.7 | 11.3 | 42.8 | 3.7 |
| Corporate loans | 0.4 | 2.4 | 8.2 | 9.3 | 2.5 | 21.1 | 1.1 |
| Total | 0.3 | 4.8 | 6.5 | 19.3 | 5.3 | 31.3 | 1.5 |

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Movement in gross exposures and impairment allowance including provisions for loan commitments and

financial guarantees

The following tables present a reconciliation of the opening to the closing balance of the exposure and impairment allowance.

Transfers between stages in the tables have been reflected as if they had taken place at the beginning of the year. 'Net drawdowns,

repayments, net-remeasurement and movements due to exposure and risk parameter changes' includes additional drawdowns and

partial repayments from existing facilities. Additionally, the below tables do not include other financial assets subject to impairment such

as debt securities at amortised cost, cash collateral and settlement balances, financial assets at fair value through other comprehensive

income and other assets.

The movements are measured over a 12-month period.

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|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Loans and advances at amortised cost (audited) | | | | | | | | |
|  | Stage 1 | | Stage 2 | | Stage 3 | | Total | |
|  | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| Retail mortgages |  |  |  |  |  |  |  |  |
| As at 1 January 2023 | 153,672 | 29 | 18,200 | 73 | 2,414 | 414 | 174,286 | 516 |
| Transfers from Stage 1 to Stage 2 | (9,557) | (2) | 9,557 | 2 | — | — | — | — |
| Transfers from Stage 2 to Stage 1 | 6,052 | 22 | (6,052) | (22) | — | — | — | — |
| Transfers to Stage 3 | (453) | — | (530) | (13) | 983 | 13 | — | — |
| Transfers from Stage 3 | 26 | 1 | 122 | 2 | (148) | (3) | — | — |
| Business activity in the year1 | 23,329 | 13 | 978 | 7 | 26 | 11 | 24,333 | 31 |
| Refinements to models used for calculation | — | — | — | — | — | — | — | — |
| Net drawdowns, repayments, net re-measurement  and movements due to exposure and risk parameter  changes | (11,505) | (8) | (1,136) | 65 | (502) | 27 | (13,143) | 84 |
| Final repayments | (10,837) | (3) | (1,666) | (9) | (328) | (15) | (12,831) | (27) |
| Disposals2 | (525) | (2) | (4) | — | (2) | — | (531) | (2) |
| Write-offs | — | — | — | — | (19) | (19) | (19) | (19) |
| As at 31 December 2023 | 150,202 | 50 | 19,469 | 105 | 2,424 | 428 | 172,095 | 583 |
| Retail credit cards |  |  |  |  |  |  |  |  |
| As at 1 January 2023 | 29,788 | 458 | 6,449 | 1,620 | 1,380 | 955 | 37,617 | 3,033 |
| Transfers from Stage 1 to Stage 2 | (2,406) | (68) | 2,406 | 68 | — | — | — | — |
| Transfers from Stage 2 to Stage 1 | 2,900 | 590 | (2,900) | (590) | — | — | — | — |
| Transfers to Stage 3 | (678) | (27) | (874) | (374) | 1,552 | 401 | — | — |
| Transfers from Stage 3 | 54 | 32 | 31 | 18 | (85) | (50) | — | — |
| Business activity in the year | 2,775 | 60 | 332 | 116 | 29 | 25 | 3,136 | 201 |
| Refinements to models used for calculation3 | — | (28) | — | 37 | — | 11 | — | 20 |
| Net drawdowns, repayments, net re-measurement  and movements due to exposure and risk parameter  changes | (162) | (465) | 649 | 797 | (47) | 998 | 440 | 1,330 |
| Final repayments | (241) | (14) | (70) | (21) | (26) | (19) | (337) | (54) |
| Transfers to assets held for sale4 | (1,621) | (15) | (445) | (41) | (92) | (68) | (2,158) | (124) |
| Disposals2 | — | — | — | — | (186) | (115) | (186) | (115) |
| Write-offs | — | — | — | — | (805) | (805) | (805) | (805) |
| As at 31 December 2023 | 30,409 | 523 | 5,578 | 1,630 | 1,720 | 1,333 | 37,707 | 3,486 |
| Retail other |  |  |  |  |  |  |  |  |
| As at 1 January 2023 | 13,470 | 100 | 1,468 | 166 | 720 | 308 | 15,658 | 574 |
| Transfers from Stage 1 to Stage 2 | (1,179) | (13) | 1,179 | 13 | — | — | — | — |
| Transfers from Stage 2 to Stage 1 | 463 | 36 | (463) | (36) | — | — | — | — |
| Transfers to Stage 3 | (549) | (4) | (154) | (44) | 703 | 48 | — | — |
| Transfers from Stage 3 | 33 | 3 | 9 | 4 | (42) | (7) | — | — |
| Business activity in the year | 7,302 | 27 | 197 | 23 | 28 | 21 | 7,527 | 71 |
| Refinements to models used for calculation | — | — | — | — | — | — | — | — |
| Net drawdowns, repayments, net re-measurement  and movements due to exposure and risk parameter  changes | (4,163) | (57) | (247) | 31 | (146) | 115 | (4,556) | 89 |
| Final repayments | (5,347) | (13) | (358) | (7) | (421) | (44) | (6,126) | (64) |
| Transfers to assets held for sale4 | (1,561) | (20) | (288) | (32) | (84) | (60) | (1,933) | (112) |
| Disposals2 | — | — | — | — | (134) | (74) | (134) | (74) |
| Write-offs | — | — | — | — | (131) | (131) | (131) | (131) |
| As at 31 December 2023 | 8,469 | 59 | 1,343 | 118 | 493 | 176 | 10,305 | 353 |

Notes

1 Business activity in the year reported within Retail mortgages includes an acquisition of Kensington Mortgage Company in UK Mortgages of £2.4bn.

2 The £531m of disposals reported within Retail mortgages relate to transfer of facilities to a non-consolidated special purpose vehicle for the purpose of securitisation. The £186m  of

disposals reported within Retail credit cards include debt sales undertaken during the year. The £134m of disposals reported within Retail other include £64m part sale of Wealth

portfolio in Italy and £70m of debt sales undertaken during the year.

3 Refinements to models used for calculation reported within Retail credit cards include a £88m movement in UK Cards, £43m movement in US Cards and £(111)m movement in the

German consumer finance business. These reflect model enhancements  made during the year. Barclays continually reviews the output of models to determine accuracy of the ECL

calculation including review of model monitoring, external benchmarking and experience of model operation over an extended period of time. This helps to ensure that the models used

continue to reflect the  risks inherent across the businesses.

4 Transfers to assets held for sale reported within Retail credit cards and Retail other relate to the German consumer finance business.

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|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Loans and advances at amortised cost (audited) | | | | | | | | |
|  | Stage 1 | | Stage 2 | | Stage 3 | | Total | |
|  | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| Corporate loans |  |  |  |  |  |  |  |  |
| As at 1 January 2023 | 111,891 | 461 | 16,818 | 424 | 2,572 | 542 | 131,281 | 1,427 |
| Transfers from Stage 1 to Stage 2 | (6,172) | (45) | 6,172 | 45 | — | — | — | — |
| Transfers from Stage 2 to Stage 1 | 5,592 | 108 | (5,592) | (108) | — | — | — | — |
| Transfers to Stage 3 | (758) | (10) | (1,011) | (27) | 1,769 | 37 | — | — |
| Transfers from Stage 3 | 195 | 16 | 403 | 22 | (598) | (38) | — | — |
| Business activity in the year | 23,213 | 43 | 933 | 29 | 205 | 29 | 24,351 | 101 |
| Refinements to models used for calculation1 | — | (61) | — | 174 | — | — | — | 113 |
| Net drawdowns, repayments, net re-measurement  and movements due to exposure and risk parameter  changes 2 | 2,079 | (179) | (1,618) | (73) | (667) | 405 | (206) | 153 |
| Final repayments | (23,149) | (43) | (2,689) | (46) | (406) | (65) | (26,244) | (154) |
| Disposals3 | (386) | (3) | (114) | (26) | (108) | (99) | (608) | (128) |
| Write-offs | — | — | — | — | (213) | (213) | (213) | (213) |
| As at 31 December 2023 | 112,505 | 287 | 13,302 | 414 | 2,554 | 598 | 128,361 | 1,299 |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Reconciliation of ECL movement to credit impairment charge/(release)  for the period |  |  |  |  |  |  |  |  |
|  | Stage 1 | Stage 2 | Stage 3 | Total |  |  |  |  |
|  | £m | £m | £m | £m |  |  |  |  |
| Retail mortgages | 23 | 32 | 33 | 88 |  |  |  |  |
| Retail credit cards | 80 | 51 | 1,366 | 1,497 |  |  |  |  |
| Retail other | (21) | (16) | 133 | 96 |  |  |  |  |
| Corporate loans | (171) | 16 | 368 | 213 |  |  |  |  |
| ECL movements excluding assets held for sale, disposals and write-offs4 | (89) | 83 | 1,900 | 1,894 |  |  |  |  |
| ECL movement on loan commitments and other financial guarantees | (72) | (28) | 21 | (79) |  |  |  |  |
| ECL movement on other financial assets | 6 | (7) | (11) | (12) |  |  |  |  |
| ECL movement on debt securities at amortised cost | 2 | (17) | — | (15) |  |  |  |  |
| Recoveries and reimbursements5 | 4 | (4) | (73) | (73) |  |  |  |  |
| Total exchange and other adjustments |  |  |  | 166 |  |  |  |  |
| Total credit impairment charge for the year |  |  |  | 1,881 |  |  |  |  |

Notes

1 Refinements to models used for calculation reported within Corporate loans include a £93m movement in Corporate and Investment Bank and £20m movement in Barclaycard

Payments. These reflect model enhancements made during the year. Barclays continually reviews the output of models to determine accuracy of the ECL calculation including review  of

model monitoring, external benchmarking and experience of model operation over an extended period of time. This helps to ensure that the models used continue to reflect the risks

inherent across the businesses.

2 'Net drawdowns, repayments, net re-measurement and movements due to exposure and risk parameter changes' reported within Corporate loans also include assets of £0.8bn

derecognised due to payment received on defaulted loans from government guarantees issued under government’s Bounce Back Loans Scheme.

3 The £608m of disposals reported within Corporate loans relate to debt sales undertaken during the year.

4 In 2023, gross write-offs amounted to £1,168m (2022: £1,620m) and post write-off recoveries amounted to £44m (2022: £64m). Net write-offs represent gross write-offs less post

write-off recoveries and amounted to £1,124m (2022: £1,556m).

5 Recoveries and reimbursements include £29m for reimbursements expected to be received under the arrangement where Group has entered into financial guarantee contracts  which

provi de credit protection over certain assets with third parties and  cash recoveries of previously written off amounts of £44m.

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|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Loan commitments and financial guarantees (audited) | | | | | | | | |
|  | Stage 1 | | Stage 2 | | Stage 3 | | Total | |
|  | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| Retail mortgages |  |  |  |  |  |  |  |  |
| As at 1 January 2023 | 11,714 | — | 450 | — | 6 | — | 12,170 | — |
| Net transfers between stages | (62) | — | 53 | — | 9 | — | — | — |
| Business activity in the year | 4,184 | — | — | — | — | — | 4,184 | — |
| Net drawdowns, repayments, net re-  measurement and movement due to exposure  and risk parameter changes | (7,669) | — | (11) | — | (11) | — | (7,691) | — |
| Limit management and final repayments | (391) | — | (44) | — | — | — | (435) | — |
| As at 31 December 2023 | 7,776 | — | 448 | — | 4 | — | 8,228 | — |
|  |  |  |  |  |  |  |  |  |
| Retail credit cards1 |  |  |  |  |  |  |  |  |
| As at 1 January 2023 | 144,957 | 50 | 5,435 | 83 | 228 | — | 150,620 | 133 |
| Net transfers between stages | 448 | 61 | (538) | (61) | 90 | — | — | — |
| Business activity in the year | 19,098 | 16 | 224 | 13 | 1 | — | 19,323 | 29 |
| Net drawdowns, repayments, net re-  measurement and movement due to exposure  and risk parameter changes | (5,863) | (59) | (1,769) | 53 | (101) | — | (7,733) | (6) |
| Limit management and final repayments | (13,849) | (9) | (545) | (34) | (76) | — | (14,470) | (43) |
| As at 31 December 2023 | 144,791 | 59 | 2,807 | 54 | 142 | — | 147,740 | 113 |
|  |  |  |  |  |  |  |  |  |
| Retail other1 |  |  |  |  |  |  |  |  |
| As at 1 January 2023 | 10,427 | 5 | 520 | — | 80 | — | 11,027 | 5 |
| Net transfers between stages | (171) | — | 140 | — | 31 | — | — | — |
| Business activity in the year | 1,639 | — | 1 | — | 4 | — | 1,644 | — |
| Net drawdowns, repayments, net re-  measurement and movement due to exposure  and risk parameter changes | (1,690) | 1 | (93) | 2 | (59) | — | (1,842) | 3 |
| Limit management and final repayments | (1,598) | — | (33) | — | (12) | — | (1,643) | — |
| As at 31 December 2023 | 8,607 | 6 | 535 | 2 | 44 | — | 9,186 | 8 |
|  |  |  |  |  |  |  |  |  |
| Corporate loans |  |  |  |  |  |  |  |  |
| As at 1 January 2023 | 205,847 | 190 | 24,289 | 232 | 866 | 23 | 231,002 | 445 |
| Net transfers between stages | 2,416 | 23 | (2,423) | (23) | 7 | — | — | — |
| Business activity in the year | 54,807 | 27 | 2,271 | 43 | 39 | 2 | 57,117 | 72 |
| Net drawdowns, repayments, net re-  measurement and movement due to exposure  and risk parameter changes | 3,556 | (106) | 97 | 25 | 206 | 24 | 3,859 | (57) |
| Limit management and final repayments | (53,737) | (26) | (3,816) | (46) | (271) | (5) | (57,824) | (77) |
| As at 31 December 2023 | 212,889 | 108 | 20,418 | 231 | 847 | 44 | 234,154 | 383 |

Note

1 Loan commitments reported within Retail credit cards and Retail other also include financial assets classified as held for sale.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 301 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Loans and advances at amortised cost (audited) | | | | | | | | |
|  | Stage 1 | | Stage 2 | | Stage 3 | | Total | |
|  | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| Retail mortgages |  |  |  |  |  |  |  |  |
| As at 1 January 2022 | 148,058 | 19 | 19,500 | 59 | 2,122 | 397 | 169,680 | 475 |
| Transfers from Stage 1 to Stage 2 | (8,747) | (1) | 8,747 | 1 | — | — | — | — |
| Transfers from Stage 2 to Stage 1 | 7,489 | 24 | (7,489) | (24) | — | — | — | — |
| Transfers to Stage 3 | (400) | — | (725) | (6) | 1,125 | 6 | — | — |
| Transfers from Stage 3 | 32 | 1 | 229 | 4 | (261) | (5) | — | — |
| Business activity in the year | 30,028 | 10 | 1,142 | 7 | 6 | — | 31,176 | 17 |
| Refinements to models used for calculation | — | — | — | — | — | — | — | — |
| Net drawdowns, repayments, net re-  measurement and movements due to exposure  and risk parameter changes | (8,846) | (22) | (1,081) | 36 | (125) | 52 | (10,052) | 66 |
| Final repayments | (13,942) | (2) | (2,123) | (4) | (426) | (9) | (16,491) | (15) |
| Disposals | — | — | — | — | — | — | — | — |
| Write-offs | — | — | — | — | (27) | (27) | (27) | (27) |
| As at 31 December 2022 | 153,672 | 29 | 18,200 | 73 | 2,414 | 414 | 174,286 | 516 |
|  |  |  |  |  |  |  |  |  |
| Retail credit cards |  |  |  |  |  |  |  |  |
| As at 1 January 2022 | 23,654 | 698 | 4,287 | 1,526 | 1,551 | 1,092 | 29,492 | 3,316 |
| Transfers from Stage 1 to Stage 2 | (2,661) | (67) | 2,661 | 67 | — | — | — | — |
| Transfers from Stage 2 to Stage 1 | 1,554 | 445 | (1,554) | (445) | — | — | — | — |
| Transfers to Stage 3 | (416) | (16) | (542) | (260) | 958 | 276 | — | — |
| Transfers from Stage 3 | 44 | 26 | 9 | 4 | (53) | (30) | — | — |
| Business activity in the year | 5,060 | 120 | 389 | 128 | 122 | 97 | 5,571 | 345 |
| Refinements to models used for calculation1 | — | 82 | — | (50) | — | 96 | — | 128 |
| Net drawdowns, repayments, net re-  measurement and movements due to exposure  and risk parameter changes | 2,973 | (801) | 1,296 | 685 | 59 | 579 | 4,328 | 463 |
| Final repayments | (261) | (25) | (68) | (24) | (34) | (18) | (363) | (67) |
| Disposals2 | (159) | (4) | (29) | (11) | (219) | (133) | (407) | (148) |
| Write-offs | — | — | — | — | (1,004) | (1,004) | (1,004) | (1,004) |
| As at 31 December 2022 | 29,788 | 458 | 6,449 | 1,620 | 1,380 | 955 | 37,617 | 3,033 |
|  |  |  |  |  |  |  |  |  |
| Retail other |  |  |  |  |  |  |  |  |
| As at 1 January 2022 | 13,413 | 106 | 1,288 | 154 | 774 | 406 | 15,475 | 666 |
| Transfers from Stage 1 to Stage 2 | (734) | (10) | 734 | 10 | — | — | — | — |
| Transfers from Stage 2 to Stage 1 | 367 | 39 | (367) | (39) | — | — | — | — |
| Transfers to Stage 3 | (224) | (4) | (155) | (43) | 379 | 47 | — | — |
| Transfers from Stage 3 | 43 | 7 | 16 | 9 | (59) | (16) | — | — |
| Business activity in the year | 6,190 | 50 | 370 | 54 | 34 | 28 | 6,594 | 132 |
| Refinements to models used for calculation1 | — | — | — | — | — | — | — | — |
| Net drawdowns, repayments, net re-  measurement and movements due to exposure  and risk parameter changes | (1,853) | (77) | (146) | 28 | 97 | 176 | (1,902) | 127 |
| Final repayments | (3,732) | (11) | (272) | (7) | (194) | (42) | (4,198) | (60) |
| Disposals2 | — | — | — | — | (56) | (36) | (56) | (36) |
| Write-offs | — | — | — | — | (255) | (255) | (255) | (255) |
| As at 31 December 2022 | 13,470 | 100 | 1,468 | 166 | 720 | 308 | 15,658 | 574 |

Notes

1 Refinements to models used for calculation reported within Retail credit cards include a £0.3bn movement in US Cards and £(0.2)bn in UK Cards. These reflect model enhancements

made during the year. Barclays continually reviews the output of models to determine accuracy of the ECL calculation including review of model monitoring, external benchmarking and

experience of model operation over an extended period of time. This helps to ensure that the models used continue to reflect the  risks inherent across the businesses.

2 The £0.4bn of disposals reported within Retail credit cards  include a £0.2bn sale of NFL portfolio within US Cards and £0.2bn of debt sales undertaken during the year. The £0.1bn

disposals reported within Retail other include debt sales undertaken during the year.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 302 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Loans and advances at amortised cost (audited) | | | | | | | | |
|  | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| Corporate loans |  |  |  |  |  |  |  |  |
| As at 1 January 2022 | 102,337 | 377 | 15,609 | 270 | 2,756 | 625 | 120,702 | 1,272 |
| Transfers from Stage 1 to Stage 2 | (7,662) | (68) | 7,662 | 68 | — | — | — | — |
| Transfers from Stage 2 to Stage 1 | 5,278 | 60 | (5,278) | (60) | — | — | — | — |
| Transfers to Stage 3 | (1,489) | (6) | (694) | (15) | 2,183 | 21 | — | — |
| Transfers from Stage 3 | 204 | 21 | 339 | 28 | (543) | (49) | — | — |
| Business activity in the year | 24,187 | 86 | 2,655 | 79 | 239 | 31 | 27,081 | 196 |
| Refinements to models used for calculation1 | — | (60) | — | (61) | — | (374) | — | (495) |
| Net drawdowns, repayments, net re-  measurement and movements due to exposure  and risk parameter changes 2 | 11,023 | 91 | 303 | 163 | (1,449) | 725 | 9,877 | 979 |
| Final repayments | (21,987) | (40) | (3,747) | (48) | (231) | (56) | (25,965) | (144) |
| Disposals3 | — | — | (31) | — | (49) | (47) | (80) | (47) |
| Write-offs | — | — | — | — | (334) | (334) | (334) | (334) |
| As at 31 December 2022 | 111,891 | 461 | 16,818 | 424 | 2,572 | 542 | 131,281 | 1,427 |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Reconciliation of ECL movement to credit impairment charge/(release) for the period | Stage 1 | Stage 2 | Stage 3 | Total |
|  | £m | £m | £m | £m |
| Retail mortgages | 10 | 14 | 44 | 68 |
| Retail credit cards | (236) | 105 | 1,000 | 869 |
| Retail other | (6) | 12 | 193 | 199 |
| Corporate loans | 84 | 154 | 298 | 536 |
| ECL movement derecognised due to disposals and write-offs4 | (148) | 285 | 1,535 | 1,672 |
| ECL movement on loan commitments and financial guarantees | 28 | 13 | — | 41 |
| ECL movement  on other financial assets | 4 | 8 | 37 | 49 |
| ECL movement on debt securities at amortised cost | 3 | 27 | (1) | 29 |
| Recoveries and reimbursements5 | (122) | (63) | (78) | (263) |
| Total exchange and other adjustments |  |  |  | (308) |
| Total credit impairment charge for the year |  |  |  | 1,220 |

Notes

1 Refinements to model  used for calculation reported within Corporate loans include a £(0.5)bn movement in Business Banking. These reflect model enhancements made during the

year. Barclays continually review the output of models to determine  accuracy of the ECL calculation including review of model monitoring, external benchmarking and experience of

model operation over an extended period of time. This ensures that the models used continue to reflect the risks inherent across the businesses.

2 'Net drawdowns, repayments, net re-measurement and movements due to exposure and risk parameter changes' reported within  Corporate loans also include assets of £1.3bn

derecognised due to payment received on defaulted loans from government guarantees issued under government’s Bounce Back Loans Scheme.

3 The £80m of disposals reported within Corporate loans relate to debt sales undertaken during the year.

4 In 2022, gross write-offs amounted to £1,620m. In Q422, £329m of balances with de minimis recovery expectations were written-off in line with policy in UK Cards and Unsecured

Loans. Post write-off recoveries amounted to £64m. Net write-offs represent gross write-offs less post write-off recoveries and amounted to £1,556m.

5 Recoveries and reimbursements include £199m for reimbursements expected to be received under the arrangement where Group has entered into financial  guarantees contracts

which provide credit protection over certain assets with third parties and cash recoveries of previously written off amounts of £64m.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 303 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Loan commitments and financial guarantees (audited) | | | | | | | | |
|  | Stage 1 | | Stage 2 | | Stage 3 | | Total | |
|  | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL | Gross  exposure | ECL |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| Retail mortgages |  |  |  |  |  |  |  |  |
| As at 1 January 2022 | 10,833 | — | 532 | — | 3 | — | 11,368 | — |
| Net transfers between stages | 8 | — | (17) | — | 9 | — | — | — |
| Business activity in the year | 8,034 | — | — | — | — | — | 8,034 | — |
| Net drawdowns, repayments, net re-  measurement and movement due to exposure  and risk parameter changes | (6,793) | — | (21) | — | (6) | — | (6,820) | — |
| Limit management and final repayments | (368) | — | (44) | — | — | — | (412) | — |
| As at 31 December 2022 | 11,714 | — | 450 | — | 6 | — | 12,170 | — |
|  |  |  |  |  |  |  |  |  |
| Retail credit cards |  |  |  |  |  |  |  |  |
| As at 1 January 2022 | 107,980 | 38 | 4,727 | 56 | 187 | 1 | 112,894 | 95 |
| Net transfers between stages | (3,029) | 41 | 2,834 | (42) | 195 | 1 | — | — |
| Business activity in the year | 35,573 | 23 | 408 | 27 | 1 | — | 35,982 | 50 |
| Net drawdowns, repayments, net re-  measurement and movement due to exposure  and risk parameter changes | 11,581 | (45) | (2,087) | 65 | (73) | (2) | 9,421 | 18 |
| Limit management and final repayments | (7,148) | (7) | (447) | (23) | (82) | — | (7,677) | (30) |
| As at 31 December 2022 | 144,957 | 50 | 5,435 | 83 | 228 | — | 150,620 | 133 |
|  |  |  |  |  |  |  |  |  |
| Retail other |  |  |  |  |  |  |  |  |
| As at 1 January 2022 | 10,983 | 5 | 507 | — | 10 | — | 11,500 | 5 |
| Net transfers between stages | (203) | — | 121 | — | 82 | — | — | — |
| Business activity in the year | 2,254 | — | 3 | — | 2 | — | 2,259 | — |
| Net drawdowns, repayments, net re-  measurement and movement due to exposure  and risk parameter changes | (1,665) | — | (102) | — | (8) | — | (1,775) | — |
| Limit management and final repayments | (942) | — | (9) | — | (6) | — | (957) | — |
| As at 31 December 2022 | 10,427 | 5 | 520 | — | 80 | — | 11,027 | 5 |
|  |  |  |  |  |  |  |  |  |
| Corporate loans |  |  |  |  |  |  |  |  |
| As at 1 January 2022 | 182,346 | 174 | 29,049 | 246 | 1,098 | 22 | 212,493 | 442 |
| Net transfers between stages | 5,668 | 66 | (5,664) | (64) | (4) | (2) | — | — |
| Business activity in the year | 44,060 | 30 | 4,273 | 54 | 26 | 2 | 48,359 | 86 |
| Net drawdowns, repayments, net re-  measurement and movement due to exposure  and risk parameter changes | 28,070 | (51) | 6,193 | 61 | 68 | 5 | 34,331 | 15 |
| Limit management and final repayments | (54,297) | (29) | (9,562) | (65) | (322) | (4) | (64,181) | (98) |
| As at 31 December 2022 | 205,847 | 190 | 24,289 | 232 | 866 | 23 | 231,002 | 445 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 304 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

Stage 2 decomposition

Stage 2 exposures are predominantly identified using quantitative tests where the lifetime PD has deteriorated more than a pre-

determined amount since origination during the year. This is augmented by inclusion of accounts meeting the designated high risk

criteria (including watchlist) for the portfolio under the qualitative test.

A small number of other accounts (1.5% of impairment allowance and 2.2% of gross exposure) are included in Stage 2. These accounts

are not otherwise identified by the quantitative or qualitative tests but are more than 30 days past due. The percentage triggered by

these backstop criteria is a measure of the effectiveness of the Stage 2 criteria in identifying deterioration prior to delinquency. These

balances include items in the Corporate and Investment Bank for reasons such as outstanding interest and fees rather than principal

balances.

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
| Loans and advances at amortised cost1 | | |  |  |  |  |  |  |  |
|  | Gross Exposure | | | |  | Impairment Allowance | | | |
|  | Quantitative  test | Qualitative test | 30 days past due  backstop | Total Stage 2 |  | Quantitative  test | Qualitative test | 30 days past due  backstop | Total Stage 2 |
| As at 31 December 2023 | £m | £m | £m | £m |  | £m | £m | £m | £m |
| Retail mortgages | 8,905 | 9,589 | 629 | 19,123 |  | 49 | 22 | 6 | 77 |
| Retail credit cards | 1,798 | 330 | — | 2,128 |  | 416 | 76 | — | 492 |
| Retail other | 775 | 462 | 15 | 1,252 |  | 104 | 12 | 1 | 117 |
| Corporate loans | 6,745 | 1,845 | 83 | 8,673 |  | 177 | 36 | 1 | 214 |
| Total UK | 18,223 | 12,226 | 727 | 31,176 |  | 746 | 146 | 8 | 900 |
| Retail mortgages | 301 | 28 | 17 | 346 |  | 24 | 2 | 2 | 28 |
| Retail credit cards2 | 2,399 | 1,020 | 31 | 3,450 |  | 750 | 367 | 21 | 1,138 |
| Retail other2 | 9 | 41 | 41 | 91 |  | 1 | — | — | 1 |
| Corporate loans | 3,593 | 964 | 72 | 4,629 |  | 155 | 42 | 3 | 200 |
| Total Rest of the World | 6,302 | 2,053 | 161 | 8,516 |  | 930 | 411 | 26 | 1,367 |
| Retail mortgages | 9,206 | 9,617 | 646 | 19,469 |  | 73 | 24 | 8 | 105 |
| Retail credit cards2 | 4,197 | 1,350 | 31 | 5,578 |  | 1,166 | 443 | 21 | 1,630 |
| Retail other2 | 784 | 503 | 56 | 1,343 |  | 105 | 12 | 1 | 118 |
| Corporate loans | 10,338 | 2,809 | 155 | 13,302 |  | 332 | 78 | 4 | 414 |
| Total Stage 2 | 24,525 | 14,279 | 888 | 39,692 |  | 1,676 | 557 | 34 | 2,267 |

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
| As at 31 December 2022 | £m | £m | £m | £m |  | £m | £m | £m | £m |
| Retail mortgages | 9,106 | 8,160 | 469 | 17,735 |  | 28 | 17 | 4 | 49 |
| Retail credit cards | 2,020 | 547 | 2 | 2,569 |  | 404 | 89 | — | 493 |
| Retail other | 749 | 390 | 58 | 1,197 |  | 120 | 17 | 1 | 138 |
| Corporate loans | 10,364 | 2,071 | 93 | 12,528 |  | 212 | 48 | 4 | 264 |
| Total UK | 22,239 | 11,168 | 622 | 34,029 |  | 764 | 171 | 9 | 944 |
| Retail mortgages | 361 | 72 | 32 | 465 |  | 19 | 2 | 3 | 24 |
| Retail credit cards | 2,999 | 848 | 33 | 3,880 |  | 801 | 304 | 22 | 1,127 |
| Retail other | 187 | 76 | 8 | 271 |  | 26 | 1 | 1 | 28 |
| Corporate loans | 3,249 | 992 | 49 | 4,290 |  | 114 | 45 | 1 | 160 |
| Total Rest of the World | 6,796 | 1,988 | 122 | 8,906 |  | 960 | 352 | 27 | 1,339 |
| Retail mortgages | 9,467 | 8,232 | 501 | 18,200 |  | 47 | 19 | 7 | 73 |
| Retail credit cards | 5,019 | 1,395 | 35 | 6,449 |  | 1,205 | 393 | 22 | 1,620 |
| Retail other | 936 | 466 | 66 | 1,468 |  | 146 | 18 | 2 | 166 |
| Corporate loans | 13,613 | 3,063 | 142 | 16,818 |  | 326 | 93 | 5 | 424 |
| Total Stage 2 | 29,035 | 13,156 | 744 | 42,935 |  | 1,724 | 523 | 36 | 2,283 |

Notes

1 Where balances satisfy more than one of the above three criteria for determining a significant increase in credit risk, the corresponding gross exposure and impairment allowance has

been assigned in order of categories presented.

2 Exposures reported within Retail credit cards and Retail other exclude the German consumer finance business  which has now been classified as assets held for sale.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 305 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

Stage 3 decomposition

Stage 3 is comprised of exposures that are considered to be credit impaired. An asset is considered credit impaired when one or more

events occur that have a detrimental impact on the estimated future cash flows of the financial asset. This comprises assets defined as

defaulted and other individually assessed exposures where imminent default or actual loss is identified.

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| Loans and advances at amortised cost |  |  |  |  |  |  |  |
|  | Gross Exposure | | |  | Impairment Allowance | | |
|  | Exposures not  charged-off | Exposures  individually  assessed or in  recovery book | Total Stage 3 |  | Exposures not  charged-off | Exposures  individually  assessed or in  recovery book | Total Stage 3 |
| As at 31 December 2023 | £m | £m | £m |  | £m | £m | £m |
| Retail mortgages | 1,473 | 339 | 1,812 |  | 67 | 45 | 112 |
| Retail credit cards | 198 | — | 198 |  | 107 | — | 107 |
| Retail other | 177 | 87 | 264 |  | 80 | 64 | 144 |
| Corporate loans | 1,198 | 494 | 1,692 |  | 139 | 207 | 346 |
| Total UK | 3,046 | 920 | 3,966 |  | 393 | 316 | 709 |
| Retail mortgages | 155 | 457 | 612 |  | 23 | 293 | 316 |
| Retail credit cards1 | 617 | 905 | 1,522 |  | 413 | 813 | 1,226 |
| Retail other1 | 65 | 164 | 229 |  | 2 | 30 | 32 |
| Corporate loans | 50 | 812 | 862 |  | 3 | 249 | 252 |
| Total Rest of the World | 887 | 2,338 | 3,225 |  | 441 | 1,385 | 1,826 |
| Retail mortgages | 1,628 | 796 | 2,424 |  | 90 | 338 | 428 |
| Retail credit cards1 | 815 | 905 | 1,720 |  | 520 | 813 | 1,333 |
| Retail other1 | 242 | 251 | 493 |  | 82 | 94 | 176 |
| Corporate loans | 1,248 | 1,306 | 2,554 |  | 142 | 456 | 598 |
| Total Stage 3 | 3,933 | 3,258 | 7,191 |  | 834 | 1,701 | 2,535 |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| As at 31 December 2022 | £m | £m | £m |  | £m | £m | £m |
| Retail mortgages | 1,211 | 270 | 1,481 |  | 52 | 6 | 58 |
| Retail credit cards | 167 | 84 | 251 |  | 124 | 13 | 137 |
| Retail other | 156 | 137 | 293 |  | 80 | 65 | 145 |
| Corporate loans | 1,504 | 504 | 2,008 |  | 125 | 235 | 360 |
| Total UK | 3,038 | 995 | 4,033 |  | 381 | 319 | 700 |
| Retail mortgages | 270 | 663 | 933 |  | 23 | 333 | 356 |
| Retail credit cards | 551 | 578 | 1,129 |  | 359 | 459 | 818 |
| Retail other | 160 | 267 | 427 |  | 45 | 118 | 163 |
| Corporate loans | 43 | 521 | 564 |  | — | 182 | 182 |
| Total Rest of the World | 1,024 | 2,029 | 3,053 |  | 427 | 1,092 | 1,519 |
| Retail mortgages | 1,481 | 933 | 2,414 |  | 75 | 339 | 414 |
| Retail credit cards | 718 | 662 | 1,380 |  | 483 | 472 | 955 |
| Retail other | 316 | 404 | 720 |  | 125 | 183 | 308 |
| Corporate loans | 1,547 | 1,025 | 2,572 |  | 125 | 417 | 542 |
| Total Stage 3 | 4,062 | 3,024 | 7,086 |  | 808 | 1,411 | 2,219 |

Note

1 Exposures reported within Retail credit cards and Retail other exclude the German consumer finance business which has now been classified as assets held for sale.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Management adjustments to models for impairment (audited)

Management adjustments to impairment models are applied in order to factor in certain conditions or changes in policy that are not fully

incorporated into the impairment models, or to reflect additional facts and circumstances at the period end. Management adjustments

are reviewed and incorporated into future model development where applicable.

Management adjustments are captured through “Economic uncertainty” and “Other” adjustments, and are presented by product and

geography below:

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| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Management adjustments to models for impairment allowance presented by product and geography (audited)1 | | | | | | |
|  | Impairment  allowance pre  management  adjustments 2 | Economic  uncertainty  adjustments  (a) | Other  adjustments  (b) | Management  adjustments  (a+b) | Total  impairment  allowance3 | Proportion of  Management  adjustments to  total impairment  allowance |
|  |
| As at 31 December 2023 | £m | £m | £m | £m | £m | % |
| Retail mortgages | 54 | 57 | 121 | 178 | 232 | 76.7 |
| Retail credit cards | 700 | 45 | (9) | 36 | 736 | 4.9 |
| Retail other | 251 | 9 | 62 | 71 | 322 | 22.0 |
| Corporate loans | 761 | 71 | 10 | 81 | 842 | 9.6 |
| Total UK | 1,766 | 182 | 184 | 366 | 2,132 | 17.2 |
| Retail mortgages | 354 | — | (3) | (3) | 351 | (0.9) |
| Retail credit cards | 2,855 | — | 8 | 8 | 2,863 | 0.3 |
| Retail other | 45 | — | (6) | (6) | 39 | (15.4) |
| Corporate loans | 828 | 16 | (4) | 12 | 840 | 1.4 |
| Total Rest of the World | 4,082 | 16 | (5) | 11 | 4,093 | 0.3 |
| Total | 5,848 | 198 | 179 | 377 | 6,225 | 6.1 |
| Debt securities at amortised cost | 27 | — | — | — | 27 | — |
| Total including debt securities at amortised cost | 5,875 | 198 | 179 | 377 | 6,252 | 6.0 |

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| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| As at 31 December 2022 | £m | £m | £m | £m | £m | % |
| Retail mortgages | 39 | 4 | 85 | 89 | 128 | 69.5 |
| Retail credit cards | 679 | 93 | 32 | 125 | 804 | 15.5 |
| Retail other | 257 | 23 | 80 | 103 | 360 | 28.6 |
| Corporate loans | 682 | 249 | 166 | 415 | 1,097 | 37.8 |
| Total UK | 1,657 | 369 | 363 | 732 | 2,389 | 30.6 |
| Retail mortgages | 388 | — | — | — | 388 | — |
| Retail credit cards | 2,307 | — | 55 | 55 | 2,362 | 2.3 |
| Retail other | 198 | 2 | 19 | 21 | 219 | 9.6 |
| Corporate loans | 1,058 | (54) | (229) | (283) | 775 | (36.5) |
| Total Rest of the World | 3,951 | (52) | (155) | (207) | 3,744 | (5.5) |
| Total | 5,608 | 317 | 208 | 525 | 6,133 | 8.6 |
| Debt securities at amortised cost | 42 | — | — | — | 42 | — |
| Total including debt securities at amortised cost | 5,650 | 317 | 208 | 525 | 6,175 | 8.5 |

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

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| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Economic uncertainty adjustments presented by stage (audited) | | | | |
|  | Stage 1 | Stage 2 | Stage 3 | Total |
| As at 31 December 2023 | £m | £m | £m | £m |
| Retail mortgages | 12 | 32 | 13 | 57 |
| Retail credit cards | 8 | 37 | — | 45 |
| Retail other | 3 | 6 | — | 9 |
| Corporate loans | 48 | 12 | 11 | 71 |
| Total UK | 71 | 87 | 24 | 182 |
| Retail mortgages | — | — | — | — |
| Retail credit cards | — | — | — | — |
| Retail other | — | — | — | — |
| Corporate loans | 4 | 12 | — | 16 |
| Total Rest of the World | 4 | 12 | — | 16 |
| Total | 75 | 99 | 24 | 198 |

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| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | Stage 1 | Stage 2 | Stage 3 | Total |
| As at 31 December 2022 | £m | £m | £m | £m |
| Retail mortgages | 1 | 3 | — | 4 |
| Retail credit cards | 17 | 76 | — | 93 |
| Retail other | 7 | 15 | 1 | 23 |
| Corporate loans | 189 | 60 | — | 249 |
| Total UK | 214 | 154 | 1 | 369 |
| Retail mortgages | — | — | — | — |
| Retail credit cards | — | — | — | — |
| Retail other | — | 2 | — | 2 |
| Corporate loans | (8) | (46) | — | (54) |
| Total Rest of the World | (8) | (44) | — | (52) |
| Total | 206 | 110 | 1 | 317 |

Notes

1 Positive values reflect an increase in impairment allowance and negative values reflect a reduction in the impairment allowance.

2 Includes £5.2bn (2022: £ 4.8bn) of modelled ECL, £0.4bn (2022: £0.4bn) of individually assessed impairments and £0.3bn (2022: £0.5 bn) ECL from non-modelled exposures and debt

securities.

3 Total impairment allowance consists of ECL stock on drawn and undrawn exposure.

Economic uncertainty adjustments

Models have been developed with data from non-inflationary periods establishing a relationship between input variables and customer

delinquency based on past behaviour. As such there is a risk that the modelled output fails to capture the appropriate response to

changes in macroeconomic variables including higher interest rates and continuing inflationary stress with modelled impairment

provisions impacted by uncertainty.

This uncertainty continues to be captured in two ways. Firstly, customer uncertainty: the identification of customers and clients who

may be more vulnerable to economic instability; and secondly, model uncertainty: to capture the impact from model limitations and

sensitivities to specific macroeconomic parameters which are applied at a portfolio level.

Economic uncertainty adjustments have decreased from last year following the re-build of UK cards and certain CIB impairment models

which better capture the macroeconomic outlook. Furthermore, adjustments have been reassessed to capture affordability headwinds

in UK retail lending.

The balance as at 31 December 2023 is £198m (2022: £317m) and includes:

Customer and client uncertainty provisions of £166m (2022: £423m):

UK retail lending includes adjustments applied to customers considered most vulnerable to affordability pressures.

• Retail mortgages (UK) £25m (2022: £4m): The increase primarily reflects the risk of borrowers refinancing onto higher rates in the

medium term.

• Retail credit cards (UK) £45m (2022: £93m): The reduction reflects the re-build of UK cards impairment models which better

capture sensitivity to movements in interest rates and inflation.

• Retail other (UK) £9m (2022: £23m): The reduction reflects customer resilience to affordability headwinds.

Corporate loans £87m (2022: £301m): This includes an adjustment of £71m in UK to reflect possible cross default risk on Barclays’

lending in respect of clients who have taken bounce back loans and £16m in Rest of the World (ROW) to provide for downside

uncertainties on European Corporates reflecting recent changes in the macroeconomic outlook.

The reduction of £(214)m in UK and ROW is informed by retirement of an adjustment for high risk sectors following a granular credit risk

assessment, and re-build of certain CIB impairment models which more appropriately capture downside risk.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Model uncertainty provisions of £32m (2022: £(106)m):

Retail mortgages (UK) £32m (2022: nil ): This includes an adjustment to correct for higher recovery expectations impacted by model

oversensitivity to certain macroeconomic variables.

Corporate loans £nil (2022: £(106)m): The adjustment held in the previous year to correct for model oversensitivity has been retired

following the re-build of certain CIB impairment models which more appropriately capture the macroeconomic outlook.

Other adjustments

Other adjustments are operational in nature and are expected to remain in place until they can be reflected in the underlying models.

These adjustments result from data limitations and model performance related issues identified through model monitoring and other

established governance processes.

Other adjustments of £179m (2022: £208m) includes:

Adjustments for definition of default (DOD) under the Capital Requirements Regulation and model monitoring in Retail mortgages,

Retail other and Corporate loans.

Retail mortgages (UK) £121m (2022: £85m): The increase reflects re-sizing of an adjustment for DOD and an ECL provision for

Kensington Mortgages which was acquired during the year.

Retail credit cards:

• UK £(9)m (2022: £32m): The reduction is informed by retirement of operational adjustments following the re-build of UK cards

impairment models.

• ROW £8m (2022: £55m): The reduction is informed by retirement of an adjustment in US cards for high-risk account management

(HRAM) accounts following model remediation during the year.

Retail other:

• UK £62m (2022: £80m): The underlying adjustments were re-sized and remain broadly in line with the previous year.

• ROW £(6)m (2022: £19m): The reduction is informed by the German consumer finance business classified as assets held for sale.

Corporate loans:

• UK £10m (2022: £166m): The reduction is informed by retirement of model monitoring adjustments in CIB following the re-build of

certain impairment models. Further, operational adjustments have been introduced during the year to remediate conservative

modelled recovery expectations in the ESHLA portfolio.

• ROW £(4)m (2022: £(229)m): The previously held adjustments linked to model monitoring and ECL sensitivity to the macroeconomic

variable for Federal Tax Receipts have been retired following the re-build of certain CIB impairment models.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Climate Risk ECL assessment

Barclays performed a credit risk assessment of physical and transition risk due to climate change. This was delivered through a

combination of a scenario approach and targeted reviews on specific portfolios identified as more susceptible to climate risk. The

analysis did not result in a separately identifiable impairment charge for year end 2023 reporting.

Scenario Approach: The climate stress test macroeconomic scenario was used in lieu of the production Downside 2 scenario to

determine impact on the weighted average ECL output. The output of this analysis was not significant to warrant an additional climate-

related impairment charge.

Specific Approach: The approach reviewed portfolios previously identified from both internal and external stress tests as more

susceptible to climate risks. In particular, the UK Mortgage portfolio was reviewed to determine the impact of a plausible change in

regulation requiring landlords to upgrade properties to minimum EPC rating of C in the buy-to-let portfolio. In addition, within the

Wholesale portfolio, certain elevated risk sectors (predominantly Oil & Gas, Automotive and Power sectors) were subject to a review

that considered probability of default impact at a counterparty level determined by individual susceptibility to transition climate risks.

The output of this review did not provide variances in ECL deemed sufficiently certain to warrant raising an additional climate-related

charge in 2023.

Barclays acknowledges that impairment could increase over time as risks become more tangible and impact consumers and clients

through physical risks or via impacts from the transition to a low carbon economy. Therefore, Barclays continues to review credit risk

outputs to determine if any additional physical or transition climate risks are identified that are not sufficiently captured via model

output.

Refer to the Barclays resilience to climate scenarios on page [132](#i4be61753b7f243b19551b0bfbf3a2a0d_16082) for further details.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Measurement uncertainty and sensitivity analysis

The measurement of modelled ECL involves complexity and judgement, including estimation of probabilities of default (PD), loss given

default (LGD), a range of unbiased future economic scenarios, estimation of expected lives, estimation of exposures at default (EAD)

and assessing significant increases in credit risk. The Group uses a  five -scenario model to calculate ECL. An external consensus

forecast is assembled from key sources, including HM Treasury (short and medium term forecasts) and  Bloomberg (based on median

of economic forecasts) which forms the Baseline scenario. In addition,  two adverse scenarios (Downside 1 and Downside 2) and two

favourable scenarios (Upside 1 and Upside 2) are derived, with associated probability weightings. The adverse scenarios are calibrated

to a broadly similar severity to the Group's internal stress tests and stress scenarios provided by regulators whilst also considering IFRS

9 specific sensitivities and non-linearity. The favourable scenarios are designed to reflect plausible upside risks to the Baseline scenario

which are broadly consistent with the economic narrative approved by the Senior Scenario Review Committee. All scenarios are

regenerated at a minimum semi-annually. The scenarios include key economic variables, (including GDP, unemployment, House Price

Index (HPI) and base rates in both the UK and US markets), and expanded variables using statistical models based on historical

correlations. The upside and downside shocks are designed to evolve over a five-year stress horizon, with all five  scenarios converging

to a steady state after approximately seven years.

Scenarios used to calculate the Group’s ECL charge were refreshed in Q423 with the Baseline scenario reflecting the latest consensus

macroeconomic forecasts available at the time of the scenario refresh. In the Baseline scenario, whilst UK and US economies avoid a

recession, GDP growth remains weak in the coming quarters and beyond as restrictive monetary policies, which impact economies with

a lag, continue to restrain growth. Having peaked in 2022, consumer price inflation in key regions continues to ease over 2023 and 2024.

The UK and US unemployment rates rise to 4.8% and 4.4% respectively over 2024 and then stabilise. With the significant decline in

inflationary pressures, major central banks refrain from further interest rate increases. UK house prices continue to decline in 2024

before stabilising and resuming the upward trend from 2025. The housing market in the US remains more resilient, with house prices

continuing to grow.

In the Downside 2 scenario, inflationary pressures are assumed to intensify again, mainly driven by strong wage growth. Central banks

raise rates further, with the UK bank rate and the US federal fund rate each reaching 8.5% in Q324. High interest rates suddenly bring

stress into the financial and non-financial system, causing joblessness to spike and triggering a housing markets crisis and central banks

are forced cut interest rates aggressively. Falling demand reduces UK and US GDP and headline inflation drops to close to zero. In the

Upside 2 scenario, tighter and more productive labour markets help to accelerate economic growth whilst keeping inflationary

pressures under control. With inflation quickly returning to target, central banks lower interest rates, further stimulating aggregate

demand and GDP growth.

The methodology for estimating scenario probability weights involves simulating a range of future paths for UK and US GDP using

historical data with the five  scenarios mapped against the distribution of these future paths. The median is centred around the Baseline

with scenarios further from the Baseline attracting a lower weighting before the five weights are normalised to total 100%. The same

scenarios used in the estimation of expected credit losses are also used to inform Barclays' internal planning. The impacts across the

portfolios are different because of the sensitivities of each of the portfolios to specific macroeconomic variables, for example,

mortgages are highly sensitive to house prices, credit cards and unsecured consumer loans are highly sensitive to unemployment. The

increases in the Downside scenario weightings reflected a reduction in GDP stress severity in the Downside scenarios which brought

the GDP of these scenarios closer to the Baseline. The increases in the Upside scenario weightings were driven by the improvement in

actual GDP and the Baseline scenario, bringing the Baseline scenario closer to the Upside scenarios. For further details see page [314](#i7a6def1484e04c58b046a12d5006baac_1-0-1-1-1841111).

The economic uncertainty adjustments of £0.2bn (2022: £0.3bn) have been applied as overlays to the modelled ECL output. These

adjustments consist of a customer and client uncertainty provision of £0.2bn (2022: £0.4bn) which has been applied to customers and

clients considered most vulnerable to affordability pressures, and a model uncertainty adjustment of  £0.0bn (2022: £(0.1)bn). For

further details see pages [307](#i632b577e07d64310a2f854d61cf30c80_5960) to [309](#i632b577e07d64310a2f854d61cf30c80_116810).

The tables below show the key macroeconomic variables used in the five scenarios (5 year  annual paths), the probability weights applied

to each scenario and the macroeconomic variables by scenario using ‘specific bases’ i.e. the most extreme position of each variable in

the context of the scenario, for example, the highest unemployment for downside scenarios and the lowest unemployment for upside

scenarios. 5-year average tables and movement over time graphs provide additional transparency. Annual paths show quarterly

averages for the year (unemployment and base rate) or change in the year (GDP and HPI).

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

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|  |  |  |  |  |  |
| Baseline | | | | | |
|  | 2023 | 2024 | 2025 | 2026 | 2027 |
| As at 31 December 2023 | % | % | % | % | % |
| UK GDP1 | 0.5 | 0.3 | 1.2 | 1.6 | 1.6 |
| UK unemployment2 | 4.2 | 4.7 | 4.7 | 4.8 | 5.0 |
| UK HPI3 | (3.3) | (5.1) | 0.7 | 3.1 | 5.3 |
| UK bank rate | 4.7 | 4.9 | 4.1 | 3.8 | 3.5 |
| US GDP1 | 2.4 | 1.3 | 1.7 | 1.9 | 1.9 |
| US unemployment4 | 3.7 | 4.3 | 4.3 | 4.3 | 4.3 |
| US HPI5 | 5.4 | 3.4 | 3.0 | 3.3 | 3.3 |
| US federal funds rate | 5.1 | 5.0 | 3.9 | 3.8 | 3.8 |
|  |  |  |  |  |  |
| Downside 2 | | | | | |
| UK GDP1 | 0.5 | (1.5) | (2.6) | 2.4 | 1.6 |
| UK unemployment2 | 4.2 | 5.2 | 7.9 | 6.3 | 5.5 |
| UK HPI3 | (3.3) | (19.3) | (16.8) | 14.5 | 12.4 |
| UK bank rate | 4.7 | 6.6 | 1.3 | 1.0 | 1.0 |
| US GDP1 | 2.4 | (0.6) | (2.0) | 3.1 | 2.0 |
| US unemployment4 | 3.7 | 5.2 | 7.2 | 5.9 | 5.2 |
| US HPI5 | 5.4 | (6.5) | (5.7) | 7.2 | 6.4 |
| US federal funds rate | 5.1 | 6.3 | 1.8 | 1.5 | 1.5 |
|  |  |  |  |  |  |
| Downside 1 | | | | | |
| UK GDP1 | 0.5 | (0.6) | (0.7) | 2.0 | 1.6 |
| UK unemployment2 | 4.2 | 4.9 | 6.3 | 5.6 | 5.2 |
| UK HPI3 | (3.3) | (12.4) | (8.3) | 8.7 | 8.8 |
| UK bank rate | 4.7 | 5.8 | 2.7 | 2.5 | 2.3 |
| US GDP1 | 2.4 | 0.3 | (0.2) | 2.5 | 1.9 |
| US unemployment4 | 3.7 | 4.7 | 5.8 | 5.1 | 4.8 |
| US HPI5 | 5.4 | (1.7) | (1.4) | 5.2 | 4.8 |
| US federal funds rate | 5.1 | 5.7 | 2.9 | 2.8 | 2.8 |
|  |  |  |  |  |  |
| Upside 2 | | | | | |
| UK GDP1 | 0.5 | 2.4 | 3.7 | 2.9 | 2.4 |
| UK unemployment2 | 4.2 | 3.9 | 3.5 | 3.6 | 3.6 |
| UK HPI3 | (3.3) | 7.8 | 7.6 | 4.5 | 5.6 |
| UK bank rate | 4.7 | 4.3 | 2.7 | 2.5 | 2.5 |
| US GDP1 | 2.4 | 2.8 | 3.1 | 2.8 | 2.8 |
| US unemployment4 | 3.7 | 3.5 | 3.6 | 3.6 | 3.6 |
| US HPI5 | 5.4 | 6.1 | 4.3 | 4.5 | 4.6 |
| US federal funds rate | 5.1 | 4.3 | 2.9 | 2.8 | 2.8 |
|  |  |  |  |  |  |
| Upside 1 | | | | | |
| UK GDP1 | 0.5 | 1.4 | 2.5 | 2.3 | 2.0 |
| UK unemployment2 | 4.2 | 4.3 | 4.1 | 4.2 | 4.3 |
| UK HPI3 | (3.3) | 1.2 | 4.1 | 3.8 | 5.4 |
| UK bank rate | 4.7 | 4.6 | 3.4 | 3.3 | 3.0 |
| US GDP1 | 2.4 | 2.0 | 2.4 | 2.4 | 2.4 |
| US unemployment4 | 3.7 | 3.9 | 3.9 | 4.0 | 4.0 |
| US HPI5 | 5.4 | 4.7 | 3.7 | 3.9 | 3.9 |
| US federal funds rate | 5.1 | 4.7 | 3.5 | 3.3 | 3.3 |

Notes

1 Average Real GDP seasonally adjusted change in year.

2 Average UK unemployment rate 16-year+.

3 Change in year end UK HPI = Halifax All Houses, All Buyers index, relative to prior year end.

4 Average US civilian unemployment rate 16-year+.

5 Change in year end US HPI = FHFA house price index, relative to prior year end.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

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|  |  |  |  |  |  |
| Baseline | | | | | |
|  | 2022 | 2023 | 2024 | 2025 | 2026 |
| As at 31 December 2022 | % | % | % | % | % |
| UK GDP1 | 3.3 | (0.8) | 0.9 | 1.8 | 1.9 |
| UK unemployment2 | 3.7 | 4.5 | 4.4 | 4.1 | 4.2 |
| UK HPI3 | 8.4 | (4.7) | (1.7) | 2.2 | 2.2 |
| UK bank rate | 1.8 | 4.4 | 4.1 | 3.8 | 3.4 |
| US GDP1 | 1.8 | 0.5 | 1.2 | 1.5 | 1.5 |
| US unemployment4 | 3.7 | 4.3 | 4.7 | 4.7 | 4.7 |
| US HPI5 | 11.2 | 1.8 | 1.5 | 2.3 | 2.4 |
| US federal funds rate | 2.1 | 4.8 | 3.6 | 3.1 | 3.0 |
|  |  |  |  |  |  |
| Downside 2 | | | | | |
| UK GDP1 | 3.3 | (3.4) | (3.8) | 2.0 | 2.3 |
| UK unemployment2 | 3.7 | 6.0 | 8.4 | 8.0 | 7.4 |
| UK HPI3 | 8.4 | (18.3) | (18.8) | (7.7) | 8.2 |
| UK bank rate | 1.8 | 7.3 | 7.9 | 6.6 | 5.5 |
| US GDP1 | 1.8 | (2.7) | (3.4) | 2.0 | 2.6 |
| US unemployment4 | 3.7 | 6.0 | 8.5 | 8.1 | 7.1 |
| US HPI5 | 11.2 | (3.1) | (4.0) | (1.9) | 4.8 |
| US federal funds rate | 2.1 | 6.6 | 6.9 | 5.8 | 4.6 |
|  |  |  |  |  |  |
| Downside 1 | | | | | |
| UK GDP1 | 3.3 | (2.1) | (1.5) | 1.9 | 2.1 |
| UK unemployment2 | 3.7 | 5.2 | 6.4 | 6.0 | 5.8 |
| UK HPI3 | 8.4 | (11.7) | (10.6) | (2.8) | 5.2 |
| UK bank rate | 1.8 | 5.9 | 6.1 | 5.3 | 4.6 |
| US GDP1 | 1.8 | (1.1) | (1.1) | 1.7 | 2.1 |
| US unemployment4 | 3.7 | 5.1 | 6.6 | 6.4 | 5.9 |
| US HPI5 | 11.2 | (0.7) | (1.3) | 0.2 | 3.6 |
| US federal funds rate | 2.1 | 5.8 | 5.4 | 4.4 | 3.9 |
|  |  |  |  |  |  |
| Upside 2 | | | | | |
| UK GDP1 | 3.3 | 2.8 | 3.7 | 2.9 | 2.4 |
| UK unemployment2 | 3.7 | 3.5 | 3.4 | 3.4 | 3.4 |
| UK HPI3 | 8.4 | 8.7 | 7.5 | 4.4 | 4.2 |
| UK bank rate | 1.8 | 3.1 | 2.6 | 2.5 | 2.5 |
| US GDP1 | 1.8 | 3.3 | 3.5 | 2.8 | 2.8 |
| US unemployment4 | 3.7 | 3.3 | 3.3 | 3.3 | 3.3 |
| US HPI5 | 11.2 | 5.8 | 5.1 | 4.5 | 4.5 |
| US federal funds rate | 2.1 | 3.6 | 2.9 | 2.8 | 2.8 |
|  |  |  |  |  |  |
| Upside 1 | | | | | |
| UK GDP1 | 3.3 | 1.0 | 2.3 | 2.4 | 2.1 |
| UK unemployment2 | 3.7 | 4.0 | 3.9 | 3.8 | 3.8 |
| UK HPI3 | 8.4 | 1.8 | 2.9 | 3.3 | 3.2 |
| UK bank rate | 1.8 | 3.5 | 3.3 | 3.0 | 2.8 |
| US GDP1 | 1.8 | 1.9 | 2.3 | 2.2 | 2.2 |
| US unemployment4 | 3.7 | 3.8 | 4.0 | 4.0 | 4.0 |
| US HPI5 | 11.2 | 3.8 | 3.3 | 3.4 | 3.4 |
| US federal funds rate | 2.1 | 3.9 | 3.4 | 3.0 | 3.0 |

Notes

1 Average Real GDP seasonally adjusted change in year.

2 Average UK unemployment rate 16-year+.

3 Change in year end UK HPI = Halifax All Houses, All Buyers index, relative to prior year end.

4 Average US civilian unemployment rate 16-year+.

5 Change in year end US HPI = FHFA house price index, relative to prior year end.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

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| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Scenario probability weighting (audited)1 | | | | | |
|  | Upside 2 | Upside 1 | Baseline | Downside 1 | Downside 2 |
|  | % | % | % | % | % |
| As at 31 December 2023 |  |  |  |  |  |
| Scenario probability weighting | 13.8 | 24.7 | 32.4 | 18.3 | 10.8 |
| As at 31 December 2022 |  |  |  |  |  |
| Scenario probability weighting | 10.9 | 23.1 | 39.4 | 17.6 | 9.0 |

Note

1 For further details on changes to scenario weights see page [311](#i4be61753b7f243b19551b0bfbf3a2a0d_721).

Specific bases shows the most extreme position of each variable in the context of the downside/upside scenarios, for example, the

highest unemployment for downside scenarios, average unemployment for baseline scenarios and lowest unemployment for upside

scenarios. GDP and HPI downside and upside scenario data represents the lowest and highest cumulative position relative to the start

point, in the 20 quarter period.

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| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Macroeconomic variables (specific bases) (audited)1 | | | | | |
|  | Upside 2 | Upside 1 | Baseline | Downside 1 | Downside 2 |
| As at 31 December 2023 | % | % | % | % | % |
| UK GDP2 | 13.4 | 9.6 | 1.1 | (1.3) | (4.1) |
| UK unemployment3 | 3.5 | 3.9 | 4.7 | 6.5 | 8.3 |
| UK HPI4 | 23.8 | 11.5 | 0.1 | (22.5) | (35.0) |
| UK bank rate | 2.5 | 3.0 | 4.2 | 6.8 | 8.5 |
| US GDP2 | 15.1 | 12.3 | 1.8 | 0.6 | (1.7) |
| US unemployment3 | 3.4 | 3.5 | 4.2 | 5.9 | 7.5 |
| US HPI4 | 27.4 | 23.5 | 3.7 | 0.4 | (7.6) |
| US federal funds rate | 2.8 | 3.3 | 4.3 | 6.8 | 8.5 |
| As at 31 December 2022 |  |  |  |  |  |
| UK GDP2 | 13.9 | 9.4 | 1.4 | (3.2) | (6.8) |
| UK unemployment3 | 3.4 | 3.6 | 4.2 | 6.6 | 8.5 |
| UK HPI4 | 37.8 | 21.0 | 1.2 | (17.9) | (35.0) |
| UK bank rate | 0.5 | 0.5 | 3.5 | 6.3 | 8.0 |
| US GDP2 | 14.1 | 9.6 | 1.3 | (2.5) | (6.3) |
| US unemployment3 | 3.3 | 3.6 | 4.4 | 6.7 | 8.6 |
| US HPI4 | 35.0 | 27.5 | 3.8 | 3.7 | 0.2 |
| US federal funds rate | 0.1 | 0.1 | 3.3 | 6.0 | 7.0 |

Average basis represents the average quarterly value of variables in the 20 quarter period with GDP and HPI based on yearly average

and quarterly CAGRs respectively.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Macroeconomic variables (5 year averages) (audited)1 | | | | | |
|  | Upside 2 | Upside 1 | Baseline | Downside 1 | Downside 2 |
| As at 31 December 2023 | % | % | % | % | % |
| UK GDP5 | 2.4 | 1.7 | 1.1 | 0.6 | 0.1 |
| UK unemployment6 | 3.7 | 4.2 | 4.7 | 5.2 | 5.8 |
| UK HPI7 | 4.4 | 2.2 | 0.1 | (1.7) | (3.5) |
| UK bank rate | 3.3 | 3.8 | 4.2 | 3.6 | 2.9 |
| US GDP5 | 2.8 | 2.3 | 1.8 | 1.4 | 0.9 |
| US unemployment6 | 3.6 | 3.9 | 4.2 | 4.8 | 5.4 |
| US HPI7 | 5.0 | 4.3 | 3.7 | 2.4 | 1.2 |
| US federal funds rate | 3.6 | 4.0 | 4.3 | 3.9 | 3.2 |
| As at 31 December 2022 |  |  |  |  |  |
| UK GDP5 | 3.0 | 2.2 | 1.4 | 0.7 | 0.0 |
| UK unemployment6 | 3.5 | 3.8 | 4.2 | 5.4 | 6.7 |
| UK HPI7 | 6.6 | 3.9 | 1.2 | (2.6) | (6.4) |
| UK bank rate | 2.5 | 2.9 | 3.5 | 4.7 | 5.8 |
| US GDP5 | 2.9 | 2.1 | 1.3 | 0.7 | 0.0 |
| US unemployment6 | 3.4 | 3.9 | 4.4 | 5.5 | 6.7 |
| US HPI7 | 6.2 | 5.0 | 3.8 | 2.5 | 1.2 |
| US federal funds rate | 2.8 | 3.1 | 3.3 | 4.3 | 5.2 |

Notes

1UK GDP = Real GDP growth seasonally adjusted; UK unemployment = UK unemployment rate 16-year+; UK HPI = Halifax All Houses, All Buyers Index; US GDP = Real GDP growth

seasonally adjusted; US unemployment = US civilian unemployment rate 16-year+; US HPI = FHFA house price index. 20 quarter period starts from Q123 (2022: Q122).

2Maximum growth relative to Q422 (2022: Q421), based on 20 quarter period in Upside scenarios; 5-year yearly average CAGR in Baseline; minimum growth relative to Q422 (2022:

Q421), based on 20 quarter period in Downside scenarios.

3Lowest quarter in Upside scenarios; 5-year average in Baseline; highest quarter in Downside scenarios. Period based on 20 quarters from Q123 (2022: Q122).

4Maximum growth relative to Q422 (2022: Q421), based on 20 quarter period in Upside scenarios; 5-year quarter end CAGR in Baseline; minimum growth relative to Q422 (2022: Q421),

based on 20 quarter period in Downside scenarios.

55-year yearly average CAGR, starting 2022 (2022: 2021).

65-year average, Period based on 20 quarters from Q123 (2022: Q122).

75-year quarter end CAGR, starting Q422 (2022: Q421).

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

The graphs below plot the historical data for GDP growth rate and unemployment rate in the UK and US as well as the forecasted data

under each of the five scenarios.

|  |
| --- |
|  |
| UK GDP  (%) |

![62672162846455]()

|  |
| --- |
|  |
| US GDP  (%) |

![62672162846459]()

|  |
| --- |
|  |
| UK unemployment  (%) |

![62672162846464]()

|  |
| --- |
|  |
| US unemployment  (%) |

![62672162846468]()

GDP growth based on year on year growth each quarter (Q/(Q-4)).

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

ECL under 100%  weighted scenarios for modelled portfolios (audited)

The table below shows the  modelled ECL assuming each of the  five modelled scenarios are 100% weighted with the dispersion of

results around the Baseline, highlighting the impact on exposure and ECL across the scenarios.

Model exposure uses exposure at default (EAD) values and is not directly comparable to gross exposure used in prior disclosures.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | Scenarios | | | | | |
| As at 31 December 2023 | Weighted1 | Upside 2 | Upside 1 | Baseline | Downside 1 | Downside 2 |
| Stage 1 Model exposure (£m) |  |  |  |  |  |  |
| Retail mortgages | 145,226 | 147,415 | 146,653 | 145,405 | 142,543 | 138,925 |
| Retail credit cards2 | 66,512 | 66,459 | 66,482 | 66,497 | 66,580 | 66,580 |
| Retail other2 | 8,749 | 8,915 | 8,841 | 8,758 | 8,631 | 8,479 |
| Corporate loans | 175,282 | 179,567 | 177,923 | 175,903 | 172,328 | 167,541 |
| Stage 1 Model ECL (£m) |  |  |  |  |  |  |
| Retail mortgages | 9 | 4 | 5 | 7 | 11 | 22 |
| Retail credit cards2 | 562 | 529 | 545 | 561 | 584 | 605 |
| Retail other2 | 32 | 31 | 32 | 32 | 32 | 31 |
| Corporate loans | 275 | 243 | 257 | 270 | 298 | 318 |
| Stage 1 Coverage (%) |  |  |  |  |  |  |
| Retail mortgages | — | — | — | — | — | — |
| Retail credit cards | 0.8 | 0.8 | 0.8 | 0.8 | 0.9 | 0.9 |
| Retail other | 0.4 | 0.3 | 0.4 | 0.4 | 0.4 | 0.4 |
| Corporate loans | 0.2 | 0.1 | 0.1 | 0.2 | 0.2 | 0.2 |
| Stage 2 Model exposure (£m) |  |  |  |  |  |  |
| Retail mortgages | 20,615 | 17,769 | 18,702 | 20,149 | 23,836 | 28,822 |
| Retail credit cards2 | 7,076 | 6,897 | 6,976 | 7,064 | 7,183 | 7,387 |
| Retail other2 | 1,382 | 1,216 | 1,290 | 1,373 | 1,500 | 1,653 |
| Corporate loans | 24,374 | 19,919 | 21,621 | 23,763 | 27,445 | 32,375 |
| Stage 2 Model ECL (£m) |  |  |  |  |  |  |
| Retail mortgages | 41 | 23 | 27 | 34 | 59 | 123 |
| Retail credit cards2 | 1,684 | 1,554 | 1,609 | 1,668 | 1,775 | 1,922 |
| Retail other2 | 85 | 72 | 78 | 84 | 95 | 105 |
| Corporate loans | 663 | 509 | 565 | 633 | 782 | 1,031 |
| Stage 2 Coverage (%) |  |  |  |  |  |  |
| Retail mortgages | 0.2 | 0.1 | 0.1 | 0.2 | 0.2 | 0.4 |
| Retail credit cards | 23.8 | 22.5 | 23.1 | 23.6 | 24.7 | 26.0 |
| Retail other | 6.2 | 5.9 | 6.0 | 6.1 | 6.3 | 6.4 |
| Corporate loans | 2.7 | 2.6 | 2.6 | 2.7 | 2.8 | 3.2 |
| Stage 3 Model exposure (£m)3 |  |  |  |  |  |  |
| Retail mortgages | 1,672 | 1,672 | 1,672 | 1,672 | 1,672 | 1,672 |
| Retail credit cards2 | 1,827 | 1,827 | 1,827 | 1,827 | 1,827 | 1,827 |
| Retail other2 | 164 | 164 | 164 | 164 | 164 | 164 |
| Corporate loans | 3,436 | 3,436 | 3,436 | 3,436 | 3,436 | 3,436 |
| Stage 3 Model ECL (£m) |  |  |  |  |  |  |
| Retail mortgages | 333 | 308 | 316 | 325 | 351 | 393 |
| Retail credit cards2 | 1,315 | 1,279 | 1,296 | 1,313 | 1,341 | 1,366 |
| Retail other2 | 95 | 94 | 94 | 95 | 96 | 97 |
| Corporate loans4 | 77 | 71 | 73 | 75 | 82 | 89 |
| Stage 3 Coverage (%) |  |  |  |  |  |  |
| Retail mortgages | 19.9 | 18.4 | 18.9 | 19.4 | 21.0 | 23.5 |
| Retail credit cards | 72.0 | 70.0 | 70.9 | 71.9 | 73.4 | 74.8 |
| Retail other | 57.9 | 57.3 | 57.3 | 57.9 | 58.5 | 59.1 |
| Corporate loans4 | 2.2 | 2.1 | 2.1 | 2.2 | 2.4 | 2.6 |
| Total Model ECL (£m) |  |  |  |  |  |  |
| Retail mortgages | 383 | 335 | 348 | 366 | 421 | 538 |
| Retail credit cards2 | 3,561 | 3,362 | 3,450 | 3,542 | 3,700 | 3,893 |
| Retail other2 | 212 | 197 | 204 | 211 | 223 | 233 |
| Corporate loans4 | 1,015 | 823 | 895 | 978 | 1,162 | 1,438 |
| Total Model ECL | 5,171 | 4,717 | 4,897 | 5,097 | 5,506 | 6,102 |

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| Reconciliation to total ECL | £m |
| Total weighted model ECL | 5,171 |
| ECL from individually assessed exposures4 | 401 |
| ECL from non-modelled exposures and others | 276 |
| ECL from debt securities at amortised cost | 27 |
| ECL from post model management adjustments | 377 |
| Of which: ECL from economic uncertainty adjustments | 198 |
| Total ECL | 6,252 |

Notes

1 Model exposures are allocated to a stage based on an individual scenario rather than a probability-weighted approach, as required for Barclays reported impairment allowances. As a result, it is not

possible to back solve the final reported weighted ECL from individual scenarios given balances may be assigned to a different stage dependent on the scenario.

2 Model exposures and ECL reported within Retail credit cards and Retail other excludes the German consumer finance business which has now been classified as assets held for sale.

3 Model exposures allocated to Stage 3 does not change in any of the scenarios as the transition criteria relies only on an observable evidence of default as at 31 December 2023 and not on

macroeconomic scenario.

4 Material corporate loan defaults are individually assessed across different recovery strategies. As a result, ECL of £401m is reported as an individually assessed impairment in the reconciliation table.

The use of five scenarios with associated weighting results in a total weighted ECL uplift from the Baseline ECL of  1.5% .

Retail mortgages: Total weighted ECL of £383m represents a 4.6% increase over the Baseline ECL (£366m) with coverage ratios

remaining steady across the Upside scenarios, Baseline and Downside 1 scenario. Under the Downside 2 scenario, total ECL increases

to  £538m driven by a significant fall in UK HPI.

Retail credit cards: Total weighted ECL of £3,561m is broadly aligned to the Baseline ECL (£3,542m). Total ECL increases to £3,893m

under the Downside 2 scenario, driven by an increase in UK and US unemployment rate.

Retail other: Total weighted ECL of £212m is aligned to the Baseline ECL (£211m). Total ECL increases to £233m under the Downside

2 scenario, largely driven by an increase in UK unemployment rate.

Corporate loans: Total weighted ECL of £1,015m represents a 3.8% increase over the Baseline ECL (£978m). Total  ECL increases to

£1,438m under the Downside 2 scenario, driven by a decrease in UK and US GDP.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | Scenarios | | | | | |
| As at 31 December 2022 | Weighted1 | Upside 2 | Upside 1 | Baseline | Downside 1 | Downside 2 |
| Stage 1 Model exposure (£m) |  |  |  |  |  |  |
| Retail mortgages | 144,701 | 147,754 | 146,873 | 145,322 | 142,599 | 138,619 |
| Retail credit cards | 67,204 | 67,622 | 67,352 | 67,080 | 66,908 | 66,636 |
| Retail other | 12,282 | 12,428 | 12,341 | 12,235 | 12,111 | 11,986 |
| Corporate loans | 155,794 | 163,699 | 161,070 | 157,710 | 150,435 | 138,226 |
| Stage 1 Model ECL (£m) |  |  |  |  |  |  |
| Retail mortgages | 7 | 3 | 3 | 4 | 9 | 30 |
| Retail credit cards | 509 | 493 | 503 | 512 | 517 | 521 |
| Retail other | 52 | 45 | 49 | 52 | 54 | 55 |
| Corporate loans | 341 | 259 | 290 | 325 | 397 | 443 |
| Stage 1 Coverage (%) |  |  |  |  |  |  |
| Retail mortgages | — | — | — | — | — | — |
| Retail credit cards | 0.8 | 0.7 | 0.7 | 0.8 | 0.8 | 0.8 |
| Retail other | 0.4 | 0.4 | 0.4 | 0.4 | 0.4 | 0.5 |
| Corporate loans | 0.2 | 0.2 | 0.2 | 0.2 | 0.3 | 0.3 |
| Stage 2 Model exposure (£m) |  |  |  |  |  |  |
| Retail mortgages | 18,723 | 15,670 | 16,551 | 18,102 | 20,825 | 24,805 |
| Retail credit cards | 7,611 | 6,551 | 7,118 | 7,691 | 8,313 | 9,062 |
| Retail other | 1,559 | 1,386 | 1,485 | 1,601 | 1,741 | 1,881 |
| Corporate loans | 24,935 | 16,858 | 19,550 | 23,031 | 30,432 | 42,837 |
| Stage 2 Model ECL (£m) |  |  |  |  |  |  |
| Retail mortgages | 33 | 15 | 18 | 23 | 45 | 151 |
| Retail credit cards | 1,624 | 1,361 | 1,487 | 1,624 | 1,811 | 2,032 |
| Retail other | 124 | 96 | 109 | 124 | 144 | 160 |
| Corporate loans | 610 | 399 | 470 | 569 | 816 | 1,303 |
| Stage 2 Coverage (%) |  |  |  |  |  |  |
| Retail mortgages | 0.2 | 0.1 | 0.1 | 0.1 | 0.2 | 0.6 |
| Retail credit cards | 21.3 | 20.8 | 20.9 | 21.1 | 21.8 | 22.4 |
| Retail other | 8.0 | 6.9 | 7.3 | 7.7 | 8.3 | 8.5 |
| Corporate loans | 2.4 | 2.4 | 2.4 | 2.5 | 2.7 | 3.0 |
| Stage 3 Model exposure (£m)2 |  |  |  |  |  |  |
| Retail mortgages | 1,553 | 1,553 | 1,553 | 1,553 | 1,553 | 1,553 |
| Retail credit cards | 1,354 | 1,354 | 1,354 | 1,354 | 1,354 | 1,354 |
| Retail other | 216 | 216 | 216 | 216 | 216 | 216 |
| Corporate loans | 2,891 | 2,891 | 2,891 | 2,891 | 2,891 | 2,891 |
| Stage 3 Model ECL (£m) |  |  |  |  |  |  |
| Retail mortgages | 332 | 311 | 317 | 323 | 347 | 405 |
| Retail credit cards | 880 | 861 | 871 | 881 | 893 | 902 |
| Retail other | 132 | 129 | 131 | 132 | 134 | 136 |
| Corporate loans3 | 70 | 66 | 68 | 70 | 78 | 85 |
| Stage 3 Coverage (%) |  |  |  |  |  |  |
| Retail mortgages | 21.4 | 20.0 | 20.4 | 20.8 | 22.3 | 26.1 |
| Retail credit cards | 65.0 | 63.6 | 64.3 | 65.1 | 66.0 | 66.6 |
| Retail other | 61.1 | 59.7 | 60.6 | 61.1 | 62.0 | 63.0 |
| Corporate loans3 | 2.4 | 2.3 | 2.4 | 2.4 | 2.7 | 2.9 |
| Total Model ECL (£m) |  |  |  |  |  |  |
| Retail mortgages | 372 | 329 | 338 | 350 | 401 | 586 |
| Retail credit cards | 3,013 | 2,715 | 2,861 | 3,017 | 3,221 | 3,455 |
| Retail other | 308 | 270 | 289 | 308 | 332 | 351 |
| Corporate loans3 | 1,021 | 724 | 828 | 964 | 1,291 | 1,831 |
| Total Model ECL | 4,714 | 4,038 | 4,316 | 4,639 | 5,245 | 6,223 |

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| Reconciliation to total ECL | £m |
| Total weighted model ECL | 4,714 |
| ECL from individually assessed exposures3 | 434 |
| ECL from non-modelled exposures and others | 460 |
| ECL from debt securities at amortised cost | 42 |
| ECL from post model management adjustments | 525 |
| Of which: ECL from economic uncertainty adjustments | 317 |
| Total ECL | 6,175 |

Notes

1 Model exposures are allocated to a stage based on an individual scenario rather than a probability-weighted approach, as required for Barclays reported impairment allowances. As a result, it is not

possible to back solve the final reported weighted ECL from individual scenarios given balances may be assigned to a different stage dependent on the scenario.

2 Model exposures allocated to Stage 3 does not change in any of the scenarios as the transition criteria relies only on an observable evidence of default as at 31 December 2022 and not on

macroeconomic scenario.

3 Material corporate loan defaults are individually assessed across different recovery strategies. As a result, ECL of £ 434m is reported as an individually assessed impairment in the reconciliation table .

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Analysis of the concentration of credit risk

A concentration of credit risk exists when a number of counterparties are located in a common geographical region or are engaged in

similar activities and have similar economic characteristics that would cause their ability to meet contractual obligations to be similarly

affected by changes in economic or other conditions. The Group implements limits on concentrations in order to mitigate the risk.

The table below presents an industry credit risk concentration analysis of loans and advances at amortised cost net of impairment

allowance including breakdown by geographical location of the counterparty or customers, impairment stage, maturity and an indicator

of inclusion in carbon-related sectors. A further table is included with geography, impairment stage and maturity allocation of debt

securities at amortised cost, off- balance sheet commitments and financial guarantees and contingent liabilities at amortised cost.

Further detail on the Group policies with regard to managing concentration risk is presented in the Barclays PLC Pillar 3 Report 2023

(unaudited).

Credit risk concentration by Industry for contractual maturity, staging and geography

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| Loans and advances at amortised cost net of impairment allowance | | | | | | | | | | | | | | |
| Industry | Geography (audited) | | | | | Stage (audited) | | | | Maturity | | | | Carbon  related  sectors ¹ |
| United  Kingdom | Americas | Europe | Others | Total | Stage 1 | Stage 2 | Stage 3 | Total | < 1 year | 1-5 Years | >5 years | Total |
| As at 31 December  2023 | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m |  |
| Agriculture, Food  and Forest  Products | 3,597 | — | — | 5 | 3,602 | 2,734 | 611 | 257 | 3,602 | 808 | 1,071 | 1,723 | 3,602 | Yes |
| Mining and  Quarrying | 490 | 843 | 260 | 121 | 1,714 | 1,526 | 188 | — | 1,714 | 814 | 897 | 3 | 1,714 | Yes |
| Manufacturing | 4,200 | 1,279 | 826 | 416 | 6,721 | 5,036 | 1,515 | 170 | 6,721 | 2,873 | 3,522 | 326 | 6,721 | Yes |
| Government and  central bank | 5,987 | — | 5 | 30 | 6,022 | 5,975 | 46 | 1 | 6,022 | 2,218 | 4 | 3,800 | 6,022 |  |
| Banks | 437 | 3,606 | 1,520 | 1,896 | 7,459 | 7,458 | 1 | — | 7,459 | 7,365 | 94 | — | 7,459 |  |
| Energy and water | 2,181 | 486 | 879 | 180 | 3,726 | 3,394 | 324 | 8 | 3,726 | 750 | 2,033 | 943 | 3,726 | Yes |
| Materials and  Building | 18,631 | 2,623 | 448 | 118 | 21,820 | 18,918 | 2,318 | 584 | 21,820 | 5,154 | 9,156 | 7,510 | 21,820 | Yes |
| Wholesale and  retail distribution  and leisure | 7,585 | 1,061 | 481 | 452 | 9,579 | 7,099 | 2,151 | 329 | 9,579 | 3,114 | 5,169 | 1,296 | 9,579 |  |
| Transport and  storage | 868 | 536 | 182 | 118 | 1,704 | 1,275 | 395 | 34 | 1,704 | 402 | 1,046 | 256 | 1,704 | Yes |
| Home Loans | 166,704 | 97 | 3,882 | 829 | 171,512 | 150,152 | 19,364 | 1,996 | 171,512 | 2,009 | 10,334 | 159,169 | 171,512 | Yes |
| Business and other  services | 13,802 | 6,032 | 3,151 | 1,021 | 24,006 | 19,815 | 3,726 | 465 | 24,006 | 7,088 | 12,190 | 4,728 | 24,006 |  |
| Other Financial  Institutions | 6,093 | 25,589 | 6,481 | 2,546 | 40,709 | 38,988 | 1,613 | 108 | 40,709 | 13,955 | 22,111 | 4,643 | 40,709 |  |
| Cards, unsecured  loans and other  personal lending | 17,741 | 24,317 | 1,385 | 730 | 44,173 | 38,296 | 5,173 | 704 | 44,173 | 8,109 | 15,839 | 20,225 | 44,173 |  |
| Total loans and  advances at  amortised cost | 248,316 | 66,469 | 19,500 | 8,462 | 342,747 | 300,666 | 37,425 | 4,656 | 342,747 | 54,659 | 83,466 | 204,622 | 342,747 |  |
| Debt securities at  amortised cost³ | 26,093 | 11,681 | 10,262 | 8,713 | 56,749 | 52,858 | 3,891 | — | 56,749 | 10,061 | 28,739 | 17,949 | 56,749 |  |
| Total loans and  advances at  amortised cost  including debt  securities | 274,409 | 78,150 | 29,762 | 17,175 | 399,496 | 353,524 | 41,316 | 4,656 | 399,496 | 64,720 | 112,205 | 222,571 | 399,496 |  |
| Contingent  liabilities | 5,668 | 10,262 | 5,919 | 2,225 | 24,074 | 20,884 | 2,607 | 583 | 24,074 | 24,073 | 1 | — | 24,074 |  |
| Loan  commitments | 96,135 | 227,618 | 43,397 | 8,084 | 375,234 | 353,179 | 21,601 | 454 | 375,234 | 375,179 | 55 | — | 375,234 |  |
| Total off-balance  sheet² | 101,803 | 237,880 | 49,316 | 10,309 | 399,308 | 374,063 | 24,208 | 1,037 | 399,308 | 399,252 | 56 | — | 399,308 |  |

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

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| Loans and advances at amortised cost net of impairment allowance | | | | | | | | | | | | | | |
| Industry | Geography (audited) | | | | | Stage (audited) | | | | Maturity | | | | Carbon  related  sectors ¹ |
| United  Kingdom | Americas | Europe | Others | Total | Stage 1 | Stage 2 | Stage 3 | Total | < 1 year | 1-5 Years | >5 years | Total |
| As at 31 December  2022 | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m |  |
| Agriculture, Food  and Forest  Products | 3,762 | — | — | — | 3,762 | 2,706 | 757 | 299 | 3,762 | 743 | 1,226 | 1,793 | 3,762 | Yes |
| Mining and  Quarrying | 578 | 757 | 152 | 42 | 1,529 | 1,292 | 208 | 29 | 1,529 | 642 | 796 | 91 | 1,529 | Yes |
| Manufacturing | 4,929 | 1,683 | 803 | 610 | 8,025 | 5,935 | 1,981 | 109 | 8,025 | 3,165 | 4,483 | 377 | 8,025 | Yes |
| Government and  central bank | 6,306 | — | 16 | 434 | 6,756 | 6,743 | 13 | — | 6,756 | 2,489 | 50 | 4,217 | 6,756 |  |
| Banks | 781 | 3,406 | 1,472 | 2,251 | 7,910 | 7,870 | 37 | 3 | 7,910 | 7,535 | 375 | — | 7,910 |  |
| Energy and water | 1,825 | 751 | 1,278 | 196 | 4,050 | 3,379 | 657 | 14 | 4,050 | 734 | 2,464 | 852 | 4,050 | Yes |
| Materials and  Building | 19,694 | 2,264 | 438 | 176 | 22,572 | 18,768 | 3,396 | 408 | 22,572 | 4,188 | 10,233 | 8,151 | 22,572 | Yes |
| Wholesale and  retail distribution  and leisure | 8,939 | 1,176 | 679 | 568 | 11,362 | 8,084 | 2,913 | 365 | 11,362 | 3,754 | 6,079 | 1,529 | 11,362 |  |
| Transport and  storage | 1,111 | 598 | 186 | 340 | 2,235 | 1,706 | 456 | 73 | 2,235 | 553 | 1,379 | 303 | 2,235 | Yes |
| Home Loans | 164,946 | 763 | 6,698 | 1,408 | 173,815 | 153,684 | 18,127 | 2,004 | 173,815 | 2,994 | 11,562 | 159,259 | 173,815 | Yes |
| Business and other  services | 13,754 | 6,019 | 1,645 | 1,343 | 22,761 | 18,059 | 4,042 | 660 | 22,761 | 6,058 | 13,397 | 3,306 | 22,761 |  |
| Other Financial  Institutions | 6,113 | 23,502 | 5,916 | 2,071 | 37,602 | 35,617 | 1,883 | 102 | 37,602 | 12,587 | 21,426 | 3,589 | 37,602 |  |
| Cards, unsecured  loans and other  personal lending | 19,472 | 24,854 | 5,749 | 838 | 50,913 | 43,930 | 6,182 | 801 | 50,913 | 10,550 | 19,340 | 21,023 | 50,913 |  |
| Total loans and  advances at  amortised cost | 252,210 | 65,773 | 25,032 | 10,277 | 353,292 | 307,773 | 40,652 | 4,867 | 353,292 | 55,992 | 92,810 | 204,490 | 353,292 |  |
| Debt securities at  amortised cost³ | 18,344 | 9,078 | 7,452 | 10,613 | 45,487 | 41,715 | 3,772 | — | 45,487 | 4,424 | 27,824 | 13,239 | 45,487 |  |
| Total loans and  advances at  amortised cost  including debt  securities | 270,554 | 74,851 | 32,484 | 20,890 | 398,779 | 349,488 | 44,424 | 4,867 | 398,779 | 60,416 | 120,634 | 217,729 | 398,779 |  |
| Contingent  liabilities | 6,485 | 9,987 | 4,699 | 1,611 | 22,782 | 19,472 | 2,768 | 542 | 22,782 | 22,781 | 1 | — | 22,782 |  |
| Loan  commitments | 103,185 | 229,716 | 42,118 | 7,018 | 382,037 | 353,473 | 27,926 | 638 | 382,037 | 382,000 | 37 | — | 382,037 |  |
| Total off-balance  sheet² | 109,670 | 239,703 | 46,817 | 8,629 | 404,819 | 372,945 | 30,694 | 1,180 | 404,819 | 404,781 | 38 | — | 404,819 |  |

Notes

1 Refer to Carbon related assets table on page [285](#ieb93cc90039c44e38ee56d05f4d7349b_0-0-1-8-2015628) for more details on the "Exposures towards sectors that highly contribute to carbon related assets" under the respective Industry

sectors.

2 The Off-balance sheet contingent liabilities and loan commitments excludes the fair value balance of £16,469m in 2023 (2022: £14,894m) and includes exposures relating to financial

assets classified as assets held for sale.

3 Debt securities at amortised cost primarily includes £34,237m (2022: £27,233m) in Government and central bank, £16,265m (2022: £11,579m) in other financial  institutions, £2,854m

(2022: £3,457m) in materials & building and £1,516m (2022: £1,816m) in Banks.

-  For analysis of Debt securities by issuer, refer to "Analysis of Debt Securities" on page [334](#i992e306d544846d5aa816c5b00936055_3795).

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

The approach to management and representation of credit quality

Asset credit quality

The credit quality distribution is based on the IFRS 9   12 -month probability of default (PD) at the reporting date to ensure comparability

with other ECL disclosures in the Expected Credit Losses section.

The following internal measures are used to determine credit quality for loans:

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| PD Range % | Internal Default  Grade  Band | Default Probability | | | Credit Quality  description | Moody’s | Standard and  Poor’s |
| >Min | Mid | <=Max |
| 0.00 to < 0.15 | 1 | 0.00% | 0.01% | 0.02% | Strong | Aaa, Aa1, Aa2 | AAA, AA+, AA |
| 2 | 0.02% | 0.03% | 0.03% | Aa3 | AA- |
| 3 | 0.03% | 0.04% | 0.05% | A1, A2, A3 | A+ |
| 4 | 0.05% | 0.08% | 0.10% | A1, A2, A3 | A, A- |
| 5 | 0.10% | 0.13% | 0.15% | Baa1 | BBB+ |
| 0.15 to < 0.25 | 6 | 0.15% | 0.18% | 0.20% | Strong | Baa2 | BBB |
| 7 | 0.20% | 0.23% | 0.25% | Baa2 | BBB |
| 0.25 to < 0.50 | 8 | 0.25% | 0.28% | 0.30% | Strong | Baa3 | BBB- |
| 9 | 0.30% | 0.35% | 0.40% | Baa3 | BBB- |
| 10 | 0.40% | 0.45% | 0.50% | Ba1 | BB+ |
| 0.50 to < 0.75 | 11 | 0.50% | 0.55% | 0.60% | Strong | Ba1 | BB+ |
| 12 | 0.60% | 0.68% | 0.75% | Satisfactory | Ba1, Ba2 | BB, BB- |
| 0.75 to < 2.50 | 12 | 0.75% | 0.98% | 1.20% | Satisfactory | Ba1, Ba2, Ba3 | BB, BB- |
| 13 | 1.20% | 1.38% | 1.55% | Ba3 | BB- |
| 14 | 1.55% | 1.85% | 2.15% | Ba3 | B+ |
| 15 | 2.15% | 2.33% | 2.50% | B1 | B+ |
| 2.50 to < 10.00 | 15 | 2.50% | 2.78% | 3.05% | Satisfactory | B1 | B+ |
| 16 | 3.05% | 3.75% | 4.45% | B2 | B+ |
| 17 | 4.45% | 5.40% | 6.35% | B3, Caa1 | B |
| 18 | 6.35% | 7.50% | 8.65% | B3, Caa1 | B- |
| 19 | 8.65% | 9.32% | 10.00% | B3, Caa1 | B- |
| 10.00 to < 100.00 | 19 | 10.00% | 10.67% | 11.35% | Satisfactory | B3, Caa1 | B- |
| 20 | 11.35% | 15.00% | 18.65% | Higher Risk | Caa2 | CCC+ |
| 21 | 18.65% | 30.00% | 99.99% | Higher Risk | Caa3, Ca, C | CCC, CCC-,  CC+ ,CC, C |
| 100.00 (Default) | 22 | 100% | 100% | 100% | Credit  Impaired | D | D |
|  | | | | | | | |

For retail clients, a range of analytical tools is used to derive the probability of default of clients at inception and on an ongoing basis.

For loans that are not past due, these descriptions can be summarised as follows:

Strong: there is a very high likelihood of the asset being recovered in full.

Satisfactory: while there is a high likelihood that the asset will be recovered and therefore, of no cause for concern to the Group, the

asset may not be collateralised, or may relate to unsecured retail facilities. At the lower end of this grade there are customers that are

being more carefully monitored, for example, corporate customers which are indicating some evidence of deterioration, home loans

with a high loan to value, and unsecured retail loans operating outside normal product guidelines.

Higher risk: there is concern over the obligor’s ability to make payments when due. However, these have not yet converted to actual

delinquency. There may also be doubts over the value of collateral or security provided. However, the borrower or counterparty is

continuing to make payments when due and is expected to settle all outstanding amounts of principal and interest.

Loans that are past due are monitored closely, with impairment allowances raised as appropriate and in line with the Group’s

impairment policies.

Debt securities

For assets held at fair value, the carrying value on the balance sheet will include, among other things, the credit risk of the issuer. Most

listed and some unlisted securities are rated by external rating agencies. The Group mainly uses external credit ratings provided by

Standard & Poor’s, Fitch or Moody’s. Where such ratings are not available or are not current, the Group will use its own internal ratings

for the securities.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Balance sheet credit quality

The following tables present the credit quality of the Group’s assets exposed to credit risk.

Overview

As at  31 December 2023, the ratio of the Group’s on-balance sheet assets classified as strong (0.0 to <0.60%)  remained stable  at 87%

(2022: 87%) of total assets exposed to credit risk. Further analysis of debt securities by issuer and issuer type and netting and collateral

arrangements on derivative financial instruments is presented in the Analysis of debt securities section and Analysis of derivatives

section.

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|  |  |  |  |  |  |  |  |  |
| Balance sheet credit quality (audited) | | | |  |  |  |  |  |
|  | PD Range | | | Total | PD range | | | Total |
|  | 0.0 to <0.60% | 0.60 to  <11.35% | 11.35 to  100% | 0.0 to <0.60% | 0.60 to  <11.35% | 11.35 to  100% |
|  | £m | £m | £m | £m | % | % | % | % |
| As at 31 December 2023 |  |  |  |  |  |  |  |  |
| Cash and balances at central banks | 224,634 | — | — | 224,634 | 100 | — | — | 100 |
| Cash collateral and settlement balances | 99,092 | 9,789 | 8 | 108,889 | 91 | 9 | — | 100 |
| Loans and advances at amortised cost: |  |  |  |  |  |  |  |  |
| Retail mortgages | 160,647 | 8,313 | 2,552 | 171,512 | 94 | 5 | 1 | 100 |
| Retail credit cards | 10,201 | 22,322 | 1,698 | 34,221 | 30 | 65 | 5 | 100 |
| Retail other | 6,005 | 3,490 | 457 | 9,952 | 60 | 35 | 5 | 100 |
| Corporate loans | 89,972 | 32,824 | 4,266 | 127,062 | 71 | 26 | 3 | 100 |
| Total loans and advances at amortised cost | 266,825 | 66,949 | 8,973 | 342,747 | 77 | 20 | 3 | 100 |
| Debt securities at amortised cost | 56,398 | 350 | 1 | 56,749 | 99 | 1 | — | 100 |
| Reverse repurchase agreements and other  similar secured lending | 2,424 | 170 | — | 2,594 | 93 | 7 | — | 100 |
| Trading portfolio assets: |  |  |  |  |  |  |  |  |
| Debt securities | 65,469 | 9,642 | 387 | 75,498 | 86 | 13 | 1 | 100 |
| Traded loans | 4,006 | 5,893 | 2,754 | 12,653 | 32 | 46 | 22 | 100 |
| Total trading portfolio assets | 69,475 | 15,535 | 3,141 | 88,151 | 78 | 18 | 4 | 100 |
| Financial assets at fair value through the  income statement: |  |  |  |  |  |  |  |  |
| Loans and advances | 30,509 | 16,852 | 278 | 47,639 | 64 | 35 | 1 | 100 |
| Debt securities | 1,449 | 1,095 | 42 | 2,586 | 56 | 42 | 2 | 100 |
| Reverse repurchase agreements | 112,799 | 35,988 | 344 | 149,131 | 76 | 24 | — | 100 |
| Other financial assets | 88 | 22 | — | 110 | 80 | 20 | — | 100 |
| Total financial assets at fair value through the  income statement | 144,845 | 53,957 | 664 | 199,466 | 73 | 27 | — | 100 |
| Derivative financial instruments | 245,086 | 11,616 | 134 | 256,836 | 95 | 5 | — | 100 |
| Financial assets at fair value through other  comprehensive income | 71,375 | 455 | — | 71,830 | 99 | 1 | — | 100 |
| Other assets | 2,138 | 56 | 3 | 2,197 | 97 | 3 | — | 100 |
| Assets held for sale | 1,110 | 2,618 | 127 | 3,855 | 29 | 68 | 3 | 100 |
| Total on-balance sheet | 1,183,402 | 161,495 | 13,051 | 1,357,948 | 87 | 12 | 1 | 100 |

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

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| Balance sheet credit quality (audited) | | | |  |  |  |  |  |
|  | PD Range | | | Total | PD range | | | Total |
|  | 0.0 to <0.60% | 0.60 to  <11.35% | 11.35 to  100% | 0.0 to <0.60% | 0.60 to  <11.35% | 11.35 to  100% |
|  | £m | £m | £m | £m | % | % | % | % |
| As at 31 December 2022 |  |  |  |  |  |  |  |  |
| Cash and balances at central banks | 256,351 | — | — | 256,351 | 100 | — | — | 100 |
| Cash collateral and settlement balances | 101,365 | 10,944 | 288 | 112,597 | 90 | 10 | — | 100 |
| Loans and advances at amortised cost: |  |  |  |  |  |  |  |  |
| Retail mortgages | 167,368 | 3,866 | 2,536 | 173,770 | 97 | 2 | 1 | 100 |
| Retail credit cards | 12,312 | 20,668 | 1,604 | 34,584 | 35 | 60 | 5 | 100 |
| Retail other | 9,672 | 4,840 | 572 | 15,084 | 64 | 32 | 4 | 100 |
| Corporate loans | 83,966 | 40,737 | 5,151 | 129,854 | 65 | 31 | 4 | 100 |
| Total loans and advances at amortised cost | 273,318 | 70,111 | 9,863 | 353,292 | 77 | 20 | 3 | 100 |
| Debt securities at amortised cost | 45,295 | 189 | 3 | 45,487 | 100 | — | — | 100 |
| Reverse repurchase agreements and other  similar secured lending | 776 | — | — | 776 | 100 | — | — | 100 |
| Trading portfolio assets: |  |  |  |  |  |  |  |  |
| Debt securities | 50,253 | 4,891 | 331 | 55,475 | 90 | 9 | 1 | 100 |
| Traded loans | 3,214 | 8,273 | 1,711 | 13,198 | 24 | 63 | 13 | 100 |
| Total trading portfolio assets | 53,467 | 13,164 | 2,042 | 68,673 | 78 | 19 | 3 | 100 |
| Financial assets at fair value through the  income statement: |  |  |  |  |  |  |  |  |
| Loans and advances | 14,684 | 24,630 | 115 | 39,429 | 38 | 62 | — | 100 |
| Debt securities | 2,122 | 1,062 | 65 | 3,249 | 65 | 33 | 2 | 100 |
| Reverse repurchase agreements | 124,794 | 38,339 | 1,548 | 164,681 | 76 | 23 | 1 | 100 |
| Other financial assets | 98 | 20 | — | 118 | 83 | 17 | — | 100 |
| Total financial assets at fair value through the  income statement | 141,698 | 64,051 | 1,728 | 207,477 | 68 | 31 | 1 | 100 |
| Derivative financial instruments | 284,491 | 17,606 | 283 | 302,380 | 94 | 6 | — | 100 |
| Financial assets at fair value through other  comprehensive income | 65,051 | 3 | — | 65,054 | 100 | — | — | 100 |
| Other assets | 1,599 | 57 | — | 1,656 | 97 | 3 | — | 100 |
| Assets held for sale | — | — | — | — | — | — | — | — |
| Total on-balance sheet | 1,223,411 | 176,125 | 14,207 | 1,413,743 | 87 | 12 | 1 | 100 |

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

Credit exposures by internal PD grade

The below tables represent credit risk profiles  by PD grade for loans and advances at amortised cost, contingent liabilities and loan

commitments.

Stage  1  higher risk assets, presented gross of associated collateral held, are of weaker credit quality but have not significantly

deteriorated since origination.

IFRS 9 Stage 1  and Stage 2 classification is not dependent solely on the absolute probability of default but on elements that determine a

Significant Increase in Credit Risk ,  including relative movement in probability of default since initial recognition. There is therefore no

direct relationship between credit quality and IFRS 9 stage classification.

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| Credit risk profile by internal PD grade for retail mortgages (audited) | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2023 | | |  |  |  |  |  |  |  |  |  |  |
| 1 - 3 | 0.0 to <0.05% | Strong | 25,759 | 587 | — | 26,346 | 1 | — | — | 1 | 26,345 | — |
| 4 - 5 | 0.05 to <0.15% | Strong | 58,656 | 3,386 | — | 62,042 | 12 | 2 | — | 14 | 62,028 | — |
| 6 - 8 | 0.15 to <0.30% | Strong | 51,292 | 7,235 | — | 58,527 | 18 | 8 | — | 26 | 58,501 | — |
| 9 - 11 | 0.30 to <0.60% | Strong | 11,350 | 2,447 | — | 13,797 | 12 | 12 | — | 24 | 13,773 | 0.2 |
| 12 - 14 | 0.60 to <2.15% | Satisfactory | 2,833 | 3,114 | — | 5,947 | 6 | 25 | — | 31 | 5,916 | 0.5 |
| 15 - 19 | 2.15 to <11.35% | Satisfactory | 194 | 2,243 | — | 2,437 | 1 | 39 | — | 40 | 2,397 | 1.6 |
| 20 - 21 | 11.35 to <100% | Higher Risk | 118 | 457 | — | 575 | — | 19 | — | 19 | 556 | 3.3 |
| 22 | 100% | Credit Impaired | — | — | 2,424 | 2,424 | — | — | 428 | 428 | 1,996 | 17.7 |
| Total |  |  | 150,202 | 19,469 | 2,424 | 172,095 | 50 | 105 | 428 | 583 | 171,512 | 0.3 |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for retail credit cards (audited)4 | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD Range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2023 | | |  |  |  |  |  |  |  |  |  |  |
| 1 - 3 | 0.0 to <0.05% | Strong | 133 | — | — | 133 | — | — | — | — | 133 | — |
| 4 - 5 | 0.05 to <0.15% | Strong | 1,463 | 4 | — | 1,467 | 2 | — | — | 2 | 1,465 | 0.1 |
| 6 - 8 | 0.15 to <0.30% | Strong | 3,374 | 6 | — | 3,380 | 9 | — | — | 9 | 3,371 | 0.3 |
| 9 - 11 | 0.30 to <0.60% | Strong | 5,248 | 11 | — | 5,259 | 27 | — | — | 27 | 5,232 | 0.5 |
| 12 - 14 | 0.60 to <2.15% | Satisfactory | 11,010 | 173 | — | 11,183 | 137 | 14 | — | 151 | 11,032 | 1.4 |
| 15 - 19 | 2.15 to <11.35% | Satisfactory | 8,867 | 3,436 | — | 12,303 | 314 | 699 | — | 1,013 | 11,290 | 8.2 |
| 20 - 21 | 11.35 to <100% | Higher Risk | 314 | 1,948 | — | 2,262 | 34 | 917 | — | 951 | 1,311 | 42.0 |
| 22 | 100% | Credit Impaired | — | — | 1,720 | 1,720 | — | — | 1,333 | 1,333 | 387 | 77.5 |
| Total |  |  | 30,409 | 5,578 | 1,720 | 37,707 | 523 | 1,630 | 1,333 | 3,486 | 34,221 | 9.2 |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for retail other (audited)4 | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD Range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2023 | | |  |  |  |  |  |  |  |  |  |  |
| 1 - 3 | 0.0 to <0.05% | Strong | 67 | — | — | 67 | 1 | — | — | 1 | 66 | 1.5 |
| 4 - 5 | 0.05 to <0.15% | Strong | 569 | 4 | — | 573 | 1 | — | — | 1 | 572 | 0.2 |
| 6 - 8 | 0.15 to <0.30% | Strong | 964 | 6 | — | 970 | 2 | — | — | 2 | 968 | 0.2 |
| 9 - 11 | 0.30 to <0.60% | Strong | 4,369 | 50 | — | 4,419 | 16 | 4 | — | 20 | 4,399 | 0.5 |
| 12 - 14 | 0.60 to <2.15% | Satisfactory | 1,899 | 241 | — | 2,140 | 15 | 15 | — | 30 | 2,110 | 1.4 |
| 15 - 19 | 2.15 to <11.35% | Satisfactory | 583 | 862 | — | 1,445 | 22 | 43 | — | 65 | 1,380 | 4.5 |
| 20 - 21 | 11.35 to <100% | Higher Risk | 18 | 180 | — | 198 | 2 | 56 | — | 58 | 140 | 29.3 |
| 22 | 100% | Credit Impaired | — | — | 493 | 493 | — | — | 176 | 176 | 317 | 35.7 |
| Total |  |  | 8,469 | 1,343 | 493 | 10,305 | 59 | 118 | 176 | 353 | 9,952 | 3.4 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 325 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for corporate loans (audited) | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD Range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2023 | | |  |  |  |  |  |  |  |  |  |  |
| 1 - 3 | 0.0 to <0.05% | Strong | 36,981 | 146 | 4 | 37,131 | 4 | — | 2 | 6 | 37,125 | — |
| 4 - 5 | 0.05 to <0.15% | Strong | 23,344 | 92 | — | 23,436 | 15 | — | — | 15 | 23,421 | 0.1 |
| 6 - 8 | 0.15 to <0.30% | Strong | 10,833 | 346 | — | 11,179 | 9 | 3 | — | 12 | 11,167 | 0.1 |
| 9 - 11 | 0.30 to <0.60% | Strong | 17,914 | 390 | — | 18,304 | 41 | 4 | — | 45 | 18,259 | 0.2 |
| 12 - 14 | 0.60 to <2.15% | Satisfactory | 17,433 | 4,694 | — | 22,127 | 106 | 68 | — | 174 | 21,953 | 0.8 |
| 15 - 19 | 2.15 to <11.35% | Satisfactory | 5,779 | 5,360 | — | 11,139 | 101 | 167 | — | 268 | 10,871 | 2.4 |
| 20 - 21 | 11.35 to <100% | Higher Risk | 221 | 2,274 | — | 2,495 | 11 | 172 | — | 183 | 2,312 | 7.3 |
| 22 | 100% | Credit Impaired | — | — | 2,550 | 2,550 | — | — | 596 | 596 | 1,954 | 23.4 |
| Total |  |  | 112,505 | 13,302 | 2,554 | 128,361 | 287 | 414 | 598 | 1,299 | 127,062 | 1.0 |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for loans and advances at amortised cost (audited)4 | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD Range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2023 | | |  |  |  |  |  |  |  |  |  |  |
| 1 - 3 | 0.0 to <0.05% | Strong | 62,940 | 733 | 4 | 63,677 | 6 | — | 2 | 8 | 63,669 | — |
| 4 - 5 | 0.05 to <0.15% | Strong | 84,032 | 3,486 | — | 87,518 | 30 | 2 | — | 32 | 87,486 | — |
| 6 - 8 | 0.15 to <0.30% | Strong | 66,463 | 7,593 | — | 74,056 | 38 | 11 | — | 49 | 74,007 | 0.1 |
| 9 - 11 | 0.30 to <0.60% | Strong | 38,881 | 2,898 | — | 41,779 | 96 | 20 | — | 116 | 41,663 | 0.3 |
| 12 - 14 | 0.60 to <2.15% | Satisfactory | 33,175 | 8,222 | — | 41,397 | 264 | 122 | — | 386 | 41,011 | 0.9 |
| 15 - 19 | 2.15 to <11.35% | Satisfactory | 15,423 | 11,901 | — | 27,324 | 438 | 948 | — | 1,386 | 25,938 | 5.1 |
| 20 - 21 | 11.35 to <100% | Higher Risk | 671 | 4,859 | — | 5,530 | 47 | 1,164 | — | 1,211 | 4,319 | 21.9 |
| 22 | 100% | Credit Impaired | — | — | 7,187 | 7,187 | — | — | 2,533 | 2,533 | 4,654 | 35.2 |
| Total |  |  | 301,585 | 39,692 | 7,191 | 348,468 | 919 | 2,267 | 2,535 | 5,721 | 342,747 | 1.6 |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for retail mortgages (audited) | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD Range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2022 | | |  |  |  |  |  |  |  |  |  |  |
| 1 - 3 | 0.0 to <0.05% | Strong | 32,991 | 762 | — | 33,753 | 1 | — | — | 1 | 33,752 | — |
| 4 - 5 | 0.05 to <0.15% | Strong | 93,388 | 8,851 | — | 102,239 | 9 | 5 | — | 14 | 102,225 | — |
| 6 - 8 | 0.15 to <0.30% | Strong | 11,346 | 2,957 | — | 14,303 | 4 | 5 | — | 9 | 14,294 | 0.1 |
| 9 - 11 | 0.30 to <0.60% | Strong | 14,830 | 2,290 | — | 17,120 | 14 | 9 | — | 23 | 17,097 | 0.1 |
| 12 - 14 | 0.60 to <2.15% | Satisfactory | 888 | 1,674 | — | 2,562 | 1 | 16 | — | 17 | 2,545 | 0.7 |
| 15 - 19 | 2.15 to <11.35% | Satisfactory | 63 | 1,281 | — | 1,344 | — | 23 | — | 23 | 1,321 | 1.7 |
| 20 - 21 | 11.35 to <100% | Higher Risk | 166 | 385 | — | 551 | — | 15 | — | 15 | 536 | 2.7 |
| 22 | 100% | Credit Impaired | — | — | 2,414 | 2,414 | — | — | 414 | 414 | 2,000 | 17.1 |
| Total |  |  | 153,672 | 18,200 | 2,414 | 174,286 | 29 | 73 | 414 | 516 | 173,770 | 0.3 |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for retail credit cards (audited) | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD Range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2022 | | |  |  |  |  |  |  |  |  |  |  |
| 1 - 3 | 0.0 to <0.05% | Strong | 194 | 3 | — | 197 | — | — | — | — | 197 | — |
| 4 - 5 | 0.05 to <0.15% | Strong | 2,556 | 3 | — | 2,559 | 6 | — | — | 6 | 2,553 | 0.2 |
| 6 - 8 | 0.15 to <0.30% | Strong | 4,139 | 5 | — | 4,144 | 14 | — | — | 14 | 4,130 | 0.3 |
| 9 - 11 | 0.30 to <0.60% | Strong | 5,446 | 18 | — | 5,464 | 30 | 2 | — | 32 | 5,432 | 0.6 |
| 12 - 14 | 0.60 to <2.15% | Satisfactory | 4,370 | 1,370 | — | 5,740 | 57 | 145 | — | 202 | 5,538 | 3.5 |
| 15 - 19 | 2.15 to <11.35% | Satisfactory | 12,719 | 3,463 | — | 16,182 | 299 | 753 | — | 1,052 | 15,130 | 6.5 |
| 20 - 21 | 11.35 to <100% | Higher Risk | 364 | 1,587 | — | 1,951 | 52 | 720 | — | 772 | 1,179 | 39.6 |
| 22 | 100% | Credit Impaired | — | — | 1,380 | 1,380 | — | — | 955 | 955 | 425 | 69.2 |
| Total |  |  | 29,788 | 6,449 | 1,380 | 37,617 | 458 | 1,620 | 955 | 3,033 | 34,584 | 8.1 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 326 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for retail other (audited) | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD Range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2022 | | |  |  |  |  |  |  |  |  |  |  |
| 1 - 3 | 0.0 to <0.05% | Strong | 101 | 1 | — | 102 | 1 | — | — | 1 | 101 | 1.0 |
| 4 - 5 | 0.05 to <0.15% | Strong | 816 | 6 | — | 822 | 1 | — | — | 1 | 821 | 0.1 |
| 6 - 8 | 0.15 to <0.30% | Strong | 1,350 | 9 | — | 1,359 | 3 | — | — | 3 | 1,356 | 0.2 |
| 9 - 11 | 0.30 to <0.60% | Strong | 7,379 | 55 | — | 7,434 | 36 | 4 | — | 40 | 7,394 | 0.5 |
| 12 - 14 | 0.60 to <2.15% | Satisfactory | 2,875 | 260 | — | 3,135 | 21 | 19 | — | 40 | 3,095 | 1.3 |
| 15 - 19 | 2.15 to <11.35% | Satisfactory | 924 | 929 | — | 1,853 | 36 | 72 | — | 108 | 1,745 | 5.8 |
| 20 - 21 | 11.35 to <100% | Higher Risk | 25 | 208 | — | 233 | 2 | 71 | — | 73 | 160 | 31.3 |
| 22 | 100% | Credit Impaired | — | — | 720 | 720 | — | — | 308 | 308 | 412 | 42.8 |
| Total |  |  | 13,470 | 1,468 | 720 | 15,658 | 100 | 166 | 308 | 574 | 15,084 | 3.7 |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for corporate loans (audited) | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD Range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2022 | | |  |  |  |  |  |  |  |  |  |  |
| 1 - 3 | 0.0 to <0.05% | Strong | 35,960 | 767 | 5 | 36,732 | 5 | 11 | 3 | 19 | 36,713 | 0.1 |
| 4 - 5 | 0.05 to <0.15% | Strong | 21,674 | 234 | — | 21,908 | 9 | 1 | — | 10 | 21,898 | — |
| 6 - 8 | 0.15 to <0.30% | Strong | 11,046 | 1,389 | — | 12,435 | 17 | 5 | — | 22 | 12,413 | 0.2 |
| 9 - 11 | 0.30 to <0.60% | Strong | 12,214 | 774 | — | 12,988 | 38 | 8 | — | 46 | 12,942 | 0.4 |
| 12 - 14 | 0.60 to <2.15% | Satisfactory | 19,612 | 3,494 | — | 23,106 | 223 | 66 | — | 289 | 22,817 | 1.3 |
| 15 - 19 | 2.15 to <11.35% | Satisfactory | 10,820 | 7,432 | — | 18,252 | 153 | 179 | — | 332 | 17,920 | 1.8 |
| 20 - 21 | 11.35 to <100% | Higher Risk | 565 | 2,728 | — | 3,293 | 16 | 154 | — | 170 | 3,123 | 5.2 |
| 22 | 100% | Credit Impaired | — | — | 2,567 | 2,567 | — | — | 539 | 539 | 2,028 | 21.0 |
| Total |  |  | 111,891 | 16,818 | 2,572 | 131,281 | 461 | 424 | 542 | 1,427 | 129,854 | 1.1 |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for loans and advances at amortised cost (audited) | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD Range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2022 | | |  |  |  |  |  |  |  |  |  |  |
| 1 - 3 | 0.0 to <0.05% | Strong | 69,246 | 1,533 | 5 | 70,784 | 7 | 11 | 3 | 21 | 70,763 | — |
| 4 - 5 | 0.05 to <0.15% | Strong | 118,434 | 9,094 | — | 127,528 | 25 | 6 | — | 31 | 127,497 | — |
| 6 - 8 | 0.15 to <0.30% | Strong | 27,881 | 4,360 | — | 32,241 | 38 | 10 | — | 48 | 32,193 | 0.1 |
| 9 - 11 | 0.30 to <0.60% | Strong | 39,869 | 3,137 | — | 43,006 | 118 | 23 | — | 141 | 42,865 | 0.3 |
| 12 - 14 | 0.60 to <2.15% | Satisfactory | 27,745 | 6,798 | — | 34,543 | 302 | 246 | — | 548 | 33,995 | 1.6 |
| 15 - 19 | 2.15 to <11.35% | Satisfactory | 24,526 | 13,105 | — | 37,631 | 488 | 1,027 | — | 1,515 | 36,116 | 4.0 |
| 20 - 21 | 11.35 to <100% | Higher Risk | 1,120 | 4,908 | — | 6,028 | 70 | 960 | — | 1,030 | 4,998 | 17.1 |
| 22 | 100% | Credit Impaired | — | — | 7,081 | 7,081 | — | — | 2,216 | 2,216 | 4,865 | 31.3 |
| Total |  |  | 308,821 | 42,935 | 7,086 | 358,842 | 1,048 | 2,283 | 2,219 | 5,550 | 353,292 | 1.5 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 327 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for contingent liabilities (audited)1 | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2023 | | |  |  |  |  |  |  |  |  |  |  |
| 1-3 | 0.0 to <0.05% | Strong | 7,582 | 79 | — | 7,661 | 1 | — | — | 1 | 7,660 | — |
| 4-5 | 0.05 to <0.15% | Strong | 3,337 | 3 | — | 3,340 | 2 | — | — | 2 | 3,338 | 0.1 |
| 6-8 | 0.15 to <0.30% | Strong | 3,211 | 157 | — | 3,368 | 3 | 1 | — | 4 | 3,364 | 0.1 |
| 9-11 | 0.30 to <0.60% | Strong | 2,848 | 285 | — | 3,133 | 3 | 4 | — | 7 | 3,126 | 0.2 |
| 12-14 | 0.60 to <2.15% | Satisfactory | 2,388 | 701 | — | 3,089 | 8 | 6 | — | 14 | 3,075 | 0.5 |
| 15-19 | 2.15 to <11.35% | Satisfactory | 1,501 | 1,027 | — | 2,528 | 29 | 41 | — | 70 | 2,458 | 2.8 |
| 20-21 | 11.35 to <100% | Higher Risk | 17 | 355 | — | 372 | 1 | 61 | — | 62 | 310 | 16.7 |
| 22 | 100% | Credit Impaired | — | — | 583 | 583 | — | — | 22 | 22 | 561 | 3.8 |
| Total |  |  | 20,884 | 2,607 | 583 | 24,074 | 47 | 113 | 22 | 182 | 23,892 | 0.8 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| As at 31 December 2022 | | |  |  |  |  |  |  |  |  |  |  |
| 1-3 | 0.0 to <0.05% | Strong | 5,695 | 149 | — | 5,844 | 7 | 1 | — | 8 | 5,836 | 0.1 |
| 4-5 | 0.05 to <0.15% | Strong | 4,210 | 348 | — | 4,558 | 2 | 1 | — | 3 | 4,555 | 0.2 |
| 6-8 | 0.15 to <0.30% | Strong | 2,733 | 180 | — | 2,913 | 3 | 3 | — | 6 | 2,907 | 0.2 |
| 9-11 | 0.30 to <0.60% | Strong | 3,161 | 214 | — | 3,375 | 8 | 1 | — | 9 | 3,366 | 0.3 |
| 12-14 | 0.60 to <2.15% | Satisfactory | 1,989 | 751 | — | 2,740 | 21 | 6 | — | 27 | 2,713 | 1.0 |
| 15-19 | 2.15 to <11.35% | Satisfactory | 1,626 | 686 | — | 2,312 | 49 | 35 | — | 84 | 2,228 | 3.6 |
| 20-21 | 11.35 to <100% | Higher Risk | 58 | 440 | — | 498 | 2 | 64 | — | 66 | 432 | 13.3 |
| 22 | 100% | Credit Impaired | — | — | 542 | 542 | — | — | 3 | 3 | 539 | 0.6 |
| Total |  |  | 19,472 | 2,768 | 542 | 22,782 | 92 | 111 | 3 | 206 | 22,576 | 0.9 |

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit risk profile by internal PD grade for loan commitments (audited)1 | | | | | | | | | | | | |
|  | | | Gross carrying amount | | | | Allowance for ECL | | | | Net  exposure | Coverage  ratio |
| Grading | PD range | Credit quality  description | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| % | £m | £m | £m | £m | £m | £m | £m | £m | £m | % |
| As at 31 December 2023 | | |  |  |  |  |  |  |  |  |  |  |
| 1-3 | 0.0 to <0.05% | Strong | 77,689 | 715 | — | 78,404 | 2 | — | — | 2 | 78,402 | — |
| 4-5 | 0.05 to <0.15% | Strong | 75,399 | 479 | — | 75,878 | 6 | 1 | — | 7 | 75,871 | — |
| 6-8 | 0.15 to <0.30% | Strong | 63,545 | 2,798 | — | 66,343 | 12 | 1 | — | 13 | 66,330 | — |
| 9-11 | 0.30 to <0.60% | Strong | 66,423 | 1,441 | — | 67,864 | 22 | 2 | — | 24 | 67,840 | — |
| 12-14 | 0.60 to <2.15% | Satisfactory | 54,686 | 4,177 | — | 58,863 | 38 | 15 | — | 53 | 58,810 | 0.1 |
| 15-19 | 2.15 to <11.35% | Satisfactory | 14,690 | 8,275 | — | 22,965 | 40 | 71 | — | 111 | 22,854 | 0.5 |
| 20-21 | 11.35 to <100% | Higher Risk | 747 | 3,716 | — | 4,463 | 6 | 84 | — | 90 | 4,373 | 2.0 |
| 22 | 100% | Credit Impaired | — | — | 454 | 454 | — | — | 22 | 22 | 432 | 4.8 |
| Total |  |  | 353,179 | 21,601 | 454 | 375,234 | 126 | 174 | 22 | 322 | 374,912 | 0.1 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| As at 31 December 2022 | | |  |  |  |  |  |  |  |  |  |  |
| 1-3 | 0.0 to <0.05% | Strong | 78,077 | 752 | — | 78,829 | 3 | 1 | — | 4 | 78,825 | — |
| 4-5 | 0.05 to <0.15% | Strong | 85,917 | 4,004 | — | 89,921 | 7 | 1 | — | 8 | 89,913 | — |
| 6-8 | 0.15 to <0.30% | Strong | 67,381 | 2,349 | — | 69,730 | 13 | 2 | — | 15 | 69,715 | — |
| 9-11 | 0.30 to <0.60% | Strong | 57,553 | 2,081 | — | 59,634 | 15 | 4 | — | 19 | 59,615 | — |
| 12-14 | 0.60 to <2.15% | Satisfactory | 33,465 | 6,681 | — | 40,146 | 50 | 28 | — | 78 | 40,068 | 0.2 |
| 15-19 | 2.15 to <11.35% | Satisfactory | 30,374 | 8,068 | — | 38,442 | 62 | 86 | — | 148 | 38,294 | 0.4 |
| 20-21 | 11.35 to <100% | Higher Risk | 706 | 3,991 | — | 4,697 | 3 | 82 | — | 85 | 4,612 | 1.8 |
| 22 | 100% | Credit Impaired | — | — | 638 | 638 | — | — | 20 | 20 | 618 | 3.1 |
| Total |  |  | 353,473 | 27,926 | 638 | 382,037 | 153 | 204 | 20 | 377 | 381,660 | 0.1 |

Notes

1    Excludes loan commitments and financial guarantees of  £16.5b n (2022 :  £14.9b n) carried at fair value.

2    PD bandings 2.15% to <10% and 10% to <11.35% have been merged for an enhanced presentation. The prior period comparative has been aligned accordingly.

3    Loan commitments reported also include exposures relating to financial assets classified as assets held for sale.

4    Exposures reported within Retail credit cards and Retail other does not include the German consumer finance business which is classified as assets held for sale.

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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

Analysis of specific portfolios and asset types

This section provides an analysis of principal portfolios and businesses, in particular, home loans, credit cards, unsecured loans and

other retail lending.

Secured home loans

The UK home loans portfolio comprises first lien home loans and accounts for 95%  ( 2022: 93%) of the Group’s total home loan

balances.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Home loans principal portfolios | | |
|  | Barclays UK | |
| As at 31 December | 2023 | 2022 |
| Gross loans and advances (£m) | 163,639 | 162,380 |
| >90 day arrears, excluding recovery book (%) | 0.2 | 0.1 |
| Annualised gross charge-off rates (%) | 0.5 | 0.5 |
| Recovery book proportion of outstanding balances (%) | 0.6 | 0.5 |
| Recovery book impairment coverage ratio (%)1 | 7.2 | 5.2 |

Note

1 Recovery Book Impairment Coverage Ratio excludes KMC.

Within the UK home loans portfolio:

• Gross loans and advances increased by £1.3bn (0.8%) following an increase in Residential (1.2% ), and a decrease in Buy to Let (BTL)

(2.1%).

• Owner-occupied interest-only home loans comprised 17%  (2022:  17%) of total balances. The average balance weighted LTV on

owner occupied loans increased to  53.1% (2022: 50.0%).

• BTL home loans comprised 12.3%  (2022:  12.7%) of total balances. In BTL, the average balance weighted LTV increased to  56.9%

(2022: 53.2%).

|  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |
| Home loans principal portfolios - distribution of balances by LTV1 | | | | | | | | | | | | |
|  | Distribution of Balances | | | | Distribution of impairment allowance | | | | Coverage ratio | | | |
|  | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
| Barclays UK | % | % | % | % | % | % | % | % | % | % | % | % |
| As at 31 December 2023 |  |  |  |  |  |  |  |  |  |  |  |  |
| <=75% | 73.5 | 10.4 | 0.9 | 84.8 | 8.5 | 16.2 | 26.7 | 51.4 | — | 0.2 | 3.8 | 0.1 |
| >75% and <=90% | 12.3 | 1.2 | 0.1 | 13.6 | 7.4 | 16.7 | 12.8 | 36.9 | 0.1 | 1.9 | 27.9 | 0.4 |
| >90% and <=100% | 1.5 | 0.1 | — | 1.6 | 1.2 | 2.5 | 3.6 | 7.3 | 0.1 | 2.6 | 63.3 | 0.6 |
| >100% | — | — | — | — | 0.3 | 0.7 | 3.4 | 4.4 | 1.0 | 12.1 | 100.0 | 12.4 |
| As at 31 December 2022 |  |  |  |  |  |  |  |  |  |  |  |  |
| <=75% | 78.8 | 10.5 | 0.8 | 90.1 | 10.2 | 30.8 | 33.2 | 74.2 | — | 0.2 | 2.9 | 0.1 |
| >75% and <=90% | 8.8 | 0.5 | — | 9.3 | 3.9 | 9.7 | 5.2 | 18.8 | — | 1.4 | 30.8 | 0.1 |
| >90% and <=100% | 0.6 | — | — | 0.6 | 0.3 | 0.3 | 2.4 | 3.0 | — | 1.5 | 85.0 | 0.4 |
| >100% | — | — | — | — | 0.1 | 0.6 | 3.3 | 4.0 | 0.4 | 21.4 | 64.9 | 13.1 |

Note

1    Portfolio marked to market based on the most updated valuation including recovery book balances. Updated valuations reflect the application of the latest HPI available as at

31 December 2023.

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| Risk performance - Credit risk (continued) | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Home loans principal portfolios – average LTV |  |  |
|  | Barclays UK | |
| As at 31 December | 2023 | 2022 |
| Overall portfolio LTV (%): |  |  |
| Balance weighted % | 53.6 | 50.4 |
| Valuation weighted % | 40.0 | 37.3 |
| For >100% LTVs: |  |  |
| Balances £m | 75 | 34 |
| Marked to market collateral £m | 65 | 26 |
| Average LTV: Balance weighted % | 146.7 | 210.6 |
| Average LTV: Valuation weighted % | 123.6 | 145.5 |
| % of Balances in Recoveries | 11.5 | 18.9 |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Home loans principal portfolios - new lending |  |  |
|  | Barclays UK | |
| As at 31 December 2023 | 2023 | 2022 |
| New Home loan bookings (£m) | 22,669 | 30,307 |
| New home loan proportion above 90% LTV (%) | 0.6 | 2.8 |
| Average LTV on new home loan: balance weighted (%) | 62.6 | 68.1 |
| Average LTV on new home loan: valuation weighted (%) | 53.8 | 59.6 |

New home loans bookings in 2023 decreased 25% to £22.7bn (2022: 30.3bn) and the 90 day arrears rate increased to 0.2% (2022:

0.1%), mainly driven by economic conditions that resulted in general mortgage market suppression, including higher mortgage

payments as rates continued to rise and increased cost of living factors in line with inflation in 2023.

Head Office: Italian home loans and advances at amortised cost reduced to £3.6bn (2022: £4.5bn) and continue to run-off since new

bookings ceased in 2016. The portfolio is secured on residential property with an average balance weighted mark to market LTV of

55.6% (2022: 58.8%). 90-day arrears increased to 2.4% (2022: 1.2% ) due to deterioration caused by affordability stress related to rising

inflation and interest rates. The gross charge-off rate was broadly stable at 0.7% (2022:  0.6%).

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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

Retail Credit Cards and Retail Other

The principal portfolios listed below accounted fo r  91%   (2022 : 87% ) of the Group’s total retail credit cards and retail other.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Retail Credit Cards and Retail Other | | | | | |
|  | Gross exposure | 30 day arrears rate,  excluding  recoveries book | 90 day arrears rate,  excluding  recoveries book | Annualised gross  write-off rates | Annualised net  write-off rates |
|  | £m | % | % | % | % |
| As at 31 December 2023 |  |  |  |  |  |
| Barclays UK |  |  |  |  |  |
| UK cards | 10,420 | 0.9 | 0.2 | 1.4 | 1.3 |
| UK personal loans | 3,641 | 1.5 | 0.6 | 1.3 | 1.0 |
| Barclays Partner Finance | 2,344 | 0.6 | 0.3 | 0.7 | 0.7 |
| Barclays International |  |  |  |  |  |
| US cards | 27,286 | 2.9 | 1.5 | 2.3 | 2.3 |
| As at 31 December 2022 |  |  |  |  |  |
| Barclays UK |  |  |  |  |  |
| UK cards | 9,939 | 0.9 | 0.2 | 3.7 | 3.6 |
| UK personal loans | 4,023 | 1.4 | 0.6 | 4.1 | 3.8 |
| Barclays Partner Finance | 2,612 | 0.5 | 0.2 | 0.7 | 0.7 |
| Barclays International |  |  |  |  |  |
| US cards | 25,554 | 2.2 | 1.2 | 2.4 | 2.3 |
| German consumer finance business | 4,269 | 1.7 | 0.7 | 0.7 | 0.6 |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Retail Credit Cards and Retail Other held for sale | | | | | |
|  | Gross exposure | 30 day arrears rate,  excluding  recoveries book | 90 day arrears rate,  excluding  recoveries book | Annualised gross  write-off rates | Annualised net  write-off rates |
| As at 31 December 2023 |  |  |  |  |  |
| Barclays International |  |  |  |  |  |
| German consumer finance business | 4,094 | 1.7 | 0.8 | 1.0 | 1.0 |

UK cards: 30 day and 90 day arrears rates remained stable at  0.9% (2022: 0.9%) and 0.2% (2022: 0.2%) respectively. Total exposure

increased from £9.9bn to £10.4bn due to growth in spend and promotional balances.  Both the gross and net write off rates decreased

by 2.3% driven by the impact of a strategy change in 2022 to align the point of charge off and write off in that year and lower charge off

rates in 2023.

UK personal loans: 30 and 90 day arrears rates have remained broadly stable at 1.5% (2022: 1.4%) and 0.6%  (2022: 0.6%) respectively.

Both the gross and net write off rates decreased by 2.8%, driven by the impact of a strategy change in 2022 to align the point of charge

off and write off in that year and by the impact of large bulk sales in 2022 which reduced the flow to write off in 2023.

Barclays Partner Finance: 30 and 90 day arrears rates increased marginally to 0.6% (2022: 0.5%) and 0.3% (2022: 0.2%) respectively as

the weighting of lower risk customers with larger balances reduced. Total exposure fell to £2.3bn (2022: £2.6bn) due to a strategic

decision to reduce the number of active partner businesses. Annualised gross and net write off rates remained stable.

US cards: 30 and 90 day arrears rates increased to 2.9% (2022: 2.2%) and 1.5% (2022: 1.2%) respectively due to an anticipated higher

flow into and through delinquency, as rates returned to pre-pandemic levels. Write off rates remained broadly stable at 2.3%.

German consumer finance business: Gross exposure decreased 4% following business reprioritisation and discontinuation of Open

Market loans originations. 30 and 90 day arrears rates remained stable and write-off rates increased due to the impact of accepting

higher loan amount applications during 2022, which has since been discontinued.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 331 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

Forbearance

Forbearance measures consist of concessions towards a debtor that is experiencing or about to experience difficulties in meeting their

financial commitments ('financial difficulties')

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Analysis of forbearance programmes | | | | | | | | |
|  | Balances | | | | Impairment allowance | | | |
|  | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| As at 31 December 2023 |  |  |  |  |  |  |  |  |
| Barclays UK | 59 | 82 | 514 | 655 | — | 12 | 137 | 149 |
| Barclays International | — | — | 290 | 290 | — | — | 128 | 128 |
| Head Office | 39 | 20 | 60 | 119 | — | 2 | 9 | 11 |
| Total retail | 98 | 102 | 864 | 1,064 | — | 14 | 274 | 288 |
| Barclays UK | 133 | 224 | 502 | 859 | 1 | 3 | 52 | 56 |
| Barclays International | 2 | 1,196 | 649 | 1,847 | — | 29 | 125 | 154 |
| Head Office | — | — | — | — | — | — | — | — |
| Total wholesale | 135 | 1,420 | 1,151 | 2,706 | 1 | 32 | 177 | 210 |
| Group total | 233 | 1,522 | 2,015 | 3,770 | 1 | 46 | 451 | 498 |
|  |  |  |  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |  |  |  |
| Barclays UK1 | 73 | 151 | 391 | 615 | 1 | 26 | 143 | 170 |
| Barclays International | 1 | 3 | 243 | 247 | — | — | 114 | 114 |
| Head Office | 20 | 30 | 101 | 151 | — | 2 | 15 | 17 |
| Total retail | 94 | 184 | 735 | 1,013 | 1 | 28 | 272 | 301 |
| Barclays UK2 | 102 | 188 | 636 | 926 | 1 | 5 | 57 | 63 |
| Barclays International | — | 903 | 698 | 1,601 | — | 21 | 108 | 129 |
| Head Office | — | — | — | — | — | — | — | — |
| Total wholesale | 102 | 1,091 | 1,334 | 2,527 | 1 | 26 | 165 | 192 |
| Group total | 196 | 1,275 | 2,069 | 3,540 | 2 | 54 | 437 | 493 |

Retail balances on forbearance reflected increases in UK Home Finance and US cards.

Wholesale balances subject to forbearance increased to £2.7b n (2022: £2.5bn) with increases in exposure in Corporate Bank and

Investment Bank of £107m and £155m respectively. Impairment allowances increased to £210m (2022: £192m ) with a range of new

cases, partially offset by write offs. Barclays International accounted for 68%  of wholesale forbearance with corporate cases

representing 87% of these balances.

Notes

1 Following a review of forbearance programmes across Barclays UK in 2023 which resulted in the identification of a segment of written off balances inflating the forbearance stock, UK

cards 2022 balances have been updated to reflect a decrease of £74m with a corresponding decrease in ECL of  £2m.

2 Following a review of forbearance programmes across Barclays UK in 2023 which resulted in 'Breathing Space', a 1–2-month cessation of interest and customer contact to allow

businesses to talk to all creditors now being included within Business Banking for the first time, UK Business Banking 2022 balances have been updated to reflect an increase of £222m

with a corresponding increase in ECL of £11m.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 332 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

Retail forbearance programmes

Forbearance on the Group’s principal retail portfolios is presented below. The principal portfolios account for 99% (2022 : 99%) of total

retail forbearance balances.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Analysis of Key Portfolios in Forbearance Programmes | | | | | | |
|  | Balances on Forbearance Programmes | | Marked to market  LTV of forbearance  balances: balance  weighted | Marked to market  LTV of forbearance  balances: valuation  weighted | Impairment  allowances marked  against balances  on forbearance  programmes | Total balances on  forbearance  programmes  coverage ratio |
|  | Total | % of gross retail  loans and advances |
|  |
|  | £m | £m | % | % | £m | % |
| As at 31 December 2023 |  |  |  |  |  |  |
| Barclays UK |  |  |  |  |  |  |
| UK Home Loans | 366 | 0.2 | 44.7 | 32.2 | 15 | 4.1 |
| UK cards | 215 | 2.1 | n/a | n/a | 86 | 40.0 |
| UK personal loans | 46 | 1.3 | n/a | n/a | 30 | 65.2 |
| Barclays Partner Finance | 17 | 0.7 | n/a | n/a | 10 | 58.8 |
| Barclays International |  |  |  |  |  |  |
| US cards | 290 | 1.1 | n/a | n/a | 128 | 44.1 |
| Head Office |  |  |  |  |  |  |
| Italy Mortgages | 119 | 3.3 | 59.8 | 44.6 | 11 | 9.2 |
|  |  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |  |
| Barclays UK |  |  |  |  |  |  |
| UK Home Loans | 263 | 0.2 | 39.6 | 28.3 | 4 | 1.5 |
| UK cards1 | 265 | 2.7 | n/a | n/a | 116 | 43.8 |
| UK personal loans | 59 | 1.5 | n/a | n/a | 33 | 55.9 |
| Barclays Partner Finance | 16 | 0.6 | n/a | n/a | 10 | 62.5 |
| Barclays International |  |  |  |  |  |  |
| US cards | 206 | 0.8 | n/a | n/a | 87 | 42.2 |
| German consumer finance business | 40 | 0.9 | n/a | n/a | 27 | 67.5 |
| Head Office |  |  |  |  |  |  |
| Italy Mortgages | 151 | 3.4 | 61.1 | 45.2 | 17 | 11.3 |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Analysis of  Portfolios- held for sale in Forbearance Programmes | | | | | | |
|  | Balances on Forbearance Programmes | | Marked to market  LTV of forbearance  balances: balance  weighted | Marked to market  LTV of forbearance  balances: valuation  weighted | Impairment  allowances marked  against balances  on forbearance  programmes | Total balances on  forbearance  programmes  coverage ratio |
|  | Total | % of gross retail  loans and advances |
|  |
|  | £m | £m | % | % | £m | % |
| As at 31 December 2023 |  |  |  |  |  |  |
| Barclays International |  |  |  |  |  |  |
| German consumer finance business | 32 | 0.8 | n/a | n/a | 22 | 68.8 |

Note

1 Following a review of forbearance programmes across Barclays UK in 2023 which resulted in the identification of a segment of written off balances inflating the forbearance stock, UK

cards 2022 balances have been updated to reflect a decrease of £74m with a corresponding decrease in ECL of  £2m.

UK home loans: Forbearance balances rose to £366m (2022: £263m) due to an increase in less-than-interest-only payment

arrangements and concessionary interest rates given to support customers facing rising mortgage interest rates and increased

affordability stress.

UK cards: Balances on forbearance decreased to £215m ( 2022: £265m) due to increased outflow, against a stable forbearance inflow

across 2023.

UK personal loans: Balances on forbearance programmes decreased to £46m (2022 : £59m), as inflow steadily reduced across 2023,

flattening in Q423, and outflow remained stable.

Barclays Partner Finance: Balances on forbearance remained stable and aligned to the total delinquent stock.

US cards: Forbearance balances increased to £290m (2022: £206m) reflecting an increase in new enrolments in 2023 in line with

increased delinquency trends as more customers required assistance.

German consumer finance business: Forbearance balances decreased to £32m (2022: £40m) due to lower customer demand and

increased operational focus on early delinquency stages.

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 333 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

Italian home loans: Forbearance balances decreased to £119m (2022: £151m) due to the continued availability of COVID-related

government schemes, which are not classified as forbearance, and exits from pre-COVID forbearance schemes.

Wholesale forbearance programmes

The table below details balance information for wholesale forbearance cases.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Analysis of wholesale balances in forbearance programmes | | | | |
|  | Balances on forbearance programmes | | Impairment  allowances marked  against balances  on forbearance  programmes | Total balances on  forbearance  programmes  coverage ratio |
|  | Total balances | % of gross  wholesale loans  and  advances |
|  |
| £m | % | £m | % |
| As at 31 December 2023 |  |  |  |  |
| Barclays UK | 859 | 2.0 | 56 | 6.5% |
| Barclays International | 1,847 | 1.3 | 154 | 8.3% |
| Total | 2,706 | 1.5 | 210 | 7.8% |
|  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |
| Barclays UK1 | 926 | 2.0 | 63 | 6.8% |
| Barclays International | 1,601 | 1.2 | 129 | 8.1% |
| Total | 2,527 | 1.4 | 192 | 7.6% |

Note

1 Following a review of forbearance programmes across Barclays UK in 2023 which resulted in 'Breathing Space', a 1–2-month cessation of interest and customer contact to allow

businesses to talk to all creditors now being included within Business Banking for the first time, UK Business Banking 2022 balances have been updated to reflect an increase of £222m

with a corresponding increase in ECL of £11m.

Analysis of debt securities

Debt securities include government securities held as part of the Group’s treasury management portfolio for liquidity and regulatory

purposes, and are for use on a continuing basis in the activities of the Group.

The following tables provide an analysis of debt securities held by the Group for trading and investment purposes by issuer type. Further

information on the credit quality of debt securities is presented in the Balance sheet credit quality section.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Debt securities | | | | |
|  | 2023 | | 2022 | |
| As at 31 December | £m | % | £m | % |
| Of which issued by: |  |  |  |  |
| Governments and other public bodies | 130,816 | 63.5 | 106,676 | 63.1 |
| Corporate and other issuers | 43,001 | 20.9 | 41,794 | 24.7 |
| US agency | 12,907 | 6.3 | 6,399 | 3.8 |
| Mortgage and asset backed securities | 19,168 | 9.3 | 14,174 | 8.4 |
| Total | 205,892 | 100 | 169,043 | 100 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 334 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

Analysis of derivatives

The tables below set out the fair values of the derivative assets together with the value of those assets subject to enforceable

counterparty netting arrangements for which the Group holds offsetting liabilities and eligible collateral.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Derivative assets (audited) | | | | | | |
|  | 2023 | | | 2022 | | |
|  | Balance sheet  assets | Counterparty  netting | Net  exposure | Balance sheet  assets | Counterparty  netting | Net  exposure |
| As at 31 December | £m | £m | £m | £m | £m | £m |
| Foreign exchange | 89,533 | 69,570 | 19,963 | 109,938 | 88,096 | 21,842 |
| Interest rate | 109,609 | 79,861 | 29,748 | 134,579 | 101,646 | 32,933 |
| Credit derivatives | 7,662 | 6,758 | 904 | 5,423 | 4,356 | 1,067 |
| Equity and stock index | 48,171 | 40,946 | 7,225 | 48,665 | 41,200 | 7,465 |
| Commodity derivatives | 1,861 | 1,674 | 187 | 3,775 | 3,039 | 736 |
| Total derivative assets | 256,836 | 198,809 | 58,027 | 302,380 | 238,337 | 64,043 |
| Cash collateral held |  |  | 31,211 |  |  | 34,547 |
| Net exposure less collateral |  |  | 26,816 |  |  | 29,496 |

Derivative asset exposures would be £230bn (2022: £273bn) lower than reported under IFRS if netting were permitted for assets and

liabilities with the same counterparty or for which the Group holds cash collateral. Similarly, derivative liabilities would be £(223)bn (2022:

£(264)bn) lower reflecting counterparty netting and collateral placed. In addition, non-cash collateral of £10bn (2022: £11bn) was held in

respect of derivative assets. The Group received collateral from clients in support of over the counter derivative transactions. These

transactions are generally undertaken under International Swaps and Derivative Association (ISDA) agreements governed by either UK

or New York law.

The table below set s out the fair value and notional amounts of OTC derivative instruments by type of collateral arrangement.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Derivatives by collateral arrangement | | | | | | |
|  | 2023 | | | 2022 | | |
|  | Notional contract  amount | Fair value | | Notional contract  amount | Fair value | |
|  | Assets | Liabilities | Assets | Liabilities |
|  | £m | £m | £m | £m | £m | £m |
| Unilateral in favour of Barclays |  |  |  |  |  |  |
| Foreign exchange | 36,163 | 986 | (611) | 37,149 | 1,130 | (677) |
| Interest rate | 15,950 | 161 | (51) | 17,967 | 151 | (57) |
| Credit derivatives | 1,216 | 9 | (394) | 823 | 26 | (224) |
| Equity and stock index | 478 | 15 | (45) | 19 | 3 | (2) |
| Total unilateral in favour of Barclays | 53,807 | 1,171 | (1,101) | 55,958 | 1,310 | (960) |
| Unilateral in favour of counterparty |  |  |  |  |  |  |
| Foreign exchange | 18,365 | 595 | (484) | 22,673 | 638 | (637) |
| Interest rate | 42,791 | 2,207 | (2,726) | 61,158 | 2,270 | (2,752) |
| Credit derivatives | 716 | — | — | 144 | — | — |
| Equity and stock index | 1,406 | 115 | (59) | 492 | 96 | (26) |
| Total unilateral in favour of counterparty | 63,278 | 2,917 | (3,269) | 84,467 | 3,004 | (3,415) |
| Bilateral arrangement |  |  |  |  |  |  |
| Foreign exchange | 6,139,730 | 83,319 | (76,345) | 5,381,723 | 102,077 | (95,377) |
| Interest rate | 19,202,160 | 100,071 | (86,135) | 14,566,844 | 124,463 | (107,895) |
| Credit derivatives | 572,188 | 4,749 | (5,278) | 582,943 | 3,635 | (3,790) |
| Equity and stock index | 433,737 | 13,390 | (19,890) | 393,664 | 9,505 | (12,280) |
| Commodity derivatives | 4,431 | 43 | (2) | 4,303 | 14 | (50) |
| Total bilateral arrangement | 26,352,246 | 201,572 | (187,650) | 20,929,477 | 239,694 | (219,392) |
| Uncollateralised derivatives |  |  |  |  |  |  |
| Foreign exchange | 372,404 | 4,102 | (5,324) | 349,569 | 5,638 | (6,979) |
| Interest rate | 419,568 | 2,357 | (4,088) | 287,026 | 3,119 | (6,864) |
| Credit derivatives | 13,352 | 178 | (333) | 35,933 | 601 | (717) |
| Equity and stock index | 13,159 | 4,272 | (5,785) | 16,101 | 3,075 | (4,416) |
| Commodity derivatives | 303 | 1 | (2) | 108 | — | (1) |
| Total uncollateralised derivatives | 818,786 | 10,910 | (15,532) | 688,737 | 12,433 | (18,977) |
| Total OTC derivative assets/(liabilities) | 27,288,117 | 216,570 | (207,552) | 21,758,639 | 256,441 | (242,744) |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 335 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Credit risk (continued) | | | | | | | | | | |

#### Market risk

Summary of contents

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |  | Page |
| Outlines key measures used to summarise the market risk  profile of the bank such as value at risk (VaR). | Market risk overview and summary of performance | [336](#i4be61753b7f243b19551b0bfbf3a2a0d_739) |
| The Group discloses details on management measures of  market risk. Total management VaR includes all trading  positions and is presented on a diversified basis by risk  factor.  This section also outlines the macroeconomic conditions  modelled as part of the Group’s risk management  framework. | Traded market risk | [336](#i4be61753b7f243b19551b0bfbf3a2a0d_748) |
| Review of management measures | [336](#i4be61753b7f243b19551b0bfbf3a2a0d_751) |
| – The daily average, maximum and minimum values of management | [337](#i4be61753b7f243b19551b0bfbf3a2a0d_754) |
|  |  |

Market risk

All disclosures in this section are unaudited

unless otherwise stated.

Overview

This section contains key statistics

describing the market risk profile of the

Group. The market risk management

section provides a description of

management VaR.

Measures of market risk in the

Group and accounting measures

Traded market risk measures such as VaR

and balance sheet exposure measures

have fundamental differences:

• balance sheet measures show accruals-

based balances or marked to market

values as at the reporting d ate;

• VaR measures also take account of

current marked to market values, but in

addition hedging effects between

positions are considered;

• market risk measures are expressed in

terms of changes in value or volatilities

as opposed to static values.

For these reasons, it is not possible to

present direct reconciliations of traded

market risk and accounting measures.

Summary of performance in the

period

Average management VaR increased 17%

to £ 42 m (2022: £ 36 m) and the range

narrowed. The increase was driven by the

impact of funded, fair value leverage loan

exposure in Investment Banking since Q4

2022, partially offset by lower market

volatility and credit spread levels in 2023 as

geopolitical tensions eased, relative to

2022, inflation declined and the pace of

interest rate rises moderated.

Management VaR declined in 2023 from a

high of £73m in November 2022, driven by

a reduction in the size of the funded, fair

value leverage loan exposure in

Investment Banking.

Traded market risk review

Review of management measures

The following disclosures provide details

on management measures of market risk.

Refer to the market risk management

section of the Barclays PLC Pillar 3 Report

2023 (unaudited) for more detail on

management measures and the

differences when compared to regulatory

measures.

The table below shows the total

management VaR on a diversified basis by

risk factor. Total management VaR

includes all trading positions in CIB and

Treasury and it is calculated with a one-day

holding period, measured to a confidence

level of 95%.

Limits are applied against each risk factor

VaR as well as total management VaR,

which are then cascaded further by risk

managers to each business.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 336 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Market risk | | | | | | | | | | |

The daily average , high and low values  of management VaR

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Management VaR (95%, one day) (audited) | | | | | | |
|  | 2023 | | | 2022 | | |
|  | Average | High1 | Low1 | Average | High1 | Low1 |
| For the year ended 31 December | £m | £m | £m | £m | £m | £m |
| Credit risk | 40 | 57 | 22 | 25 | 71 | 8 |
| Interest rate risk | 15 | 25 | 9 | 13 | 23 | 4 |
| Equity risk | 6 | 10 | 3 | 10 | 29 | 4 |
| Basis risk | 13 | 25 | 8 | 12 | 24 | 4 |
| Spread risk | 9 | 14 | 5 | 7 | 11 | 3 |
| Foreign exchange risk | 4 | 9 | 1 | 8 | 25 | 2 |
| Commodity risk | — | 1 | — | — | 1 | — |
| Inflation risk | 6 | 11 | 2 | 6 | 17 | 3 |
| Diversification effect1 | (51) | n/a | n/a | (45) | n/a | n/a |
| Total management VaR | 42 | 60 | 24 | 36 | 73 | 13 |

Note

1 Diversification effects recognise that forecast losses from different assets or businesses are unlikely to occur concurrently, hence the expected aggregate loss is lower than the sum of

the expected losses from each area. Historical correlations between losses are taken into account in making these assessments. The high and low VaR figures reported for each

category did not necessarily occur on the same day as the high and low VaR reported as a whole. Consequently, a diversification effect balance for the high and low VaR figures would not

be meaningful and is therefore omitted from the above table.

|  |
| --- |
|  |
| Group Management VaR  (£m) |

|  |
| --- |
|  |
| 100 |
| 75 |
| 50 |
| 25 |
| 0 |

![679]()

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Dec 2021 | | |  | Dec 2022 | |  |  | Dec 2023 | |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 337 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Market risk (continued) | | | | | | | | | | |

#### Treasury and Capital risk

Treasury and Capital risk: summary of contents

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | | Page |
| Liquidity risk performance |  |  |
| The risk that the firm is unable to meet its contractual or contingent obligations or that  it does not have the appropriate amount, tenor and composition of funding and liquidity  to support its assets.  This section provides an overview of the Group’s liquidity risk. | Liquidity overview and summary of performance | [339](#i65b1649a343d4e6981be1817c21942f9_15977) |
| Liquidity risk stress testing | [339](#i65b1649a343d4e6981be1817c21942f9_15982) |
| – Internal Liquidity Stress Tests | [339](#i65b1649a343d4e6981be1817c21942f9_27888) |
| – Liquidity regulation | [340](#i65b1649a343d4e6981be1817c21942f9_15991) |
| – Liquidity coverage ratio | [341](#i65b1649a343d4e6981be1817c21942f9_15984) |
| – Net stable funding ratio | [341](#i65b1649a343d4e6981be1817c21942f9_15987) |
| The liquidity pool is held unencumbered and is intended to offset stress outflows. | Liquidity pool | [341](#i65b1649a343d4e6981be1817c21942f9_15985) |
| – Composition of the liquidity pool | [341](#i293e669fb6b74963b7e1874b09a800ea_0-0-1-9-1841111) |
| – Liquidity pool by currency | [342](#i66b4dcb05b284afc930ff8e0527f82fa_0-0-1-1-1841111) |
| – Management of the liquidity pool | [342](#i65b1649a343d4e6981be1817c21942f9_15988) |
| – Contingent liquidity | [342](#i65b1649a343d4e6981be1817c21942f9_15986) |
| The basis for sound liquidity risk management is a funding structure that reduces the  probability of a liquidity stress leading to an inability to meet funding obligations as they  fall due. | Funding structure and funding relationships | [342](#i65b1649a343d4e6981be1817c21942f9_15992) |
| – Deposit funding | [343](#i65b1649a343d4e6981be1817c21942f9_15989) |
| – Wholesale funding | [343](#i65b1649a343d4e6981be1817c21942f9_15980) |
| Provides details on the contractual maturity of all financial instruments and other assets  and liabilities. | Contractual maturity of financial assets and  liabilities | [346](#id04ff4fec49245f19a256cbb2b0985f8_2855) |
| Capital risk performance |  |  |
| Capital risk is the risk that the firm has an insufficient level or composition of capital to  support its normal business activities and to meet its regulatory capital requirements  under normal operating environments or stressed conditions (both actual and as  defined for internal planning or regulatory testing purposes). This also includes the risk  from the firm’s pension plans.  This section details the Group’s capital position providing information on both capital  resources and capital requirements. It also provides details of the leverage ratios and  exposures. | Capital risk overview and summary of performance | [350](#i4be61753b7f243b19551b0bfbf3a2a0d_769) |
| Regulatory minimum capital, leverage and MREL  requirements | [350](#ifbe2a82572f14db9b00724ff22b08199_10504) |
| – Capital | [350](#ifbe2a82572f14db9b00724ff22b08199_10504) |
| – Leverage | [350](#ifbe2a82572f14db9b00724ff22b08199_10517) |
|  | | |
|  | | |
|  | | |
| This section outlines the Group’s capital ratios, capital composition, and provides  information on significant movements in CET1 capital during the year. | Analysis of capital resources | [351](#id1e1cb4f85d54f84ad4091a6ceb38d34_5565) |
| Capital ratios | [351](#i697078fab5f64721a0c574075e4f24af_0-0-1-1-2003717) |
| – Capital resources | [351](#i697078fab5f64721a0c574075e4f24af_7-0-1-1-2003717) |
| – Movement in CET1 capital | [352](#ida4f7bdd56604eba9ce41dbfd85c42cc_0-0-1-1-2003717) |
| This section outlines risk weighted assets by risk type, business and macro drivers. | Analysis of risk weighted assets | [353](#id1e1cb4f85d54f84ad4091a6ceb38d34_5563) |
| – Risk weighted assets by risk type and business | [353](#id1e1cb4f85d54f84ad4091a6ceb38d34_5559) |
| – Movement analysis of risk weighted assets | [353](#ieaea39a91db843e6be759ae9ee4ba2b1_1-0-1-1-2003717) |
| This section outlines the Group’s leverage ratios, leverage exposure composition, and  provides information on significant movements in the IFRS and leverage balance sheet. | Analysis of leverage ratios and exposures | [354](#id1e1cb4f85d54f84ad4091a6ceb38d34_5562) |
| – Leverage ratios and exposures | [354](#id1e1cb4f85d54f84ad4091a6ceb38d34_5562) |
| The Group discloses the two sources of foreign exchange risk that it is exposed to. | Foreign exchange risk | [355](#id1e1cb4f85d54f84ad4091a6ceb38d34_5561) |
| – Transactional foreign currency exposure | [355](#id1e1cb4f85d54f84ad4091a6ceb38d34_5564) |
| – Translational foreign exchange exposure | [355](#id1e1cb4f85d54f84ad4091a6ceb38d34_5560) |
| – Functional currency of operations | [355](#id1e1cb4f85d54f84ad4091a6ceb38d34_5566) |
| A review focusing on the UK retirement fund, which represents the majority of the  Group’s total retirement benefit obligation. | Pension risk review | [355](#i4be61753b7f243b19551b0bfbf3a2a0d_772) |
| – Assets and liabilities | [355](#i99f6f378f60b465b85040e3a7cd2960b_5735) |
| – IAS 19 position | [356](#i88b01250f0ce47f0b97732d7f83c7edf_0-0-1-1-1841111) |
| – Risk measurement | [356](#i99f6f378f60b465b85040e3a7cd2960b_5736) |
|  |  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 338 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | | Page |
| Interest rate risk in the banking book performance | | |
| A description of the non-traded market risk framework is provided.  The Group discloses a sensitivity analysis on pre-tax net interest income for non-  trading financial assets and liabilities. The analysis is carried out by business unit and  currency.  The Group measures some non-traded market risks, in particular prepayment,  recruitment, and residual risk using an economic capital methodology.  The Group discloses the overall impact of a parallel shift in interest rates on other  comprehensive income and cash flow hedges.  The Group measures the volatility of the value of the FVOCI instruments in the liquidity  pool through non-traded market risk VaR. | Net interest income sensitivity | [357](#i502203ad293e427aa4417d63ad98a3c2_2665) |
| – by business unit | [357](#i07b57c56b4f241c6b6ee58c42b1bb03d_0-0-1-1-1841111) |
| – by currency | [358](#ie8e0de5ed93f43cb8f6fbe43e583a34e_0-0-1-5-1841111) |
| Analysis of equity sensitivity | [358](#i502203ad293e427aa4417d63ad98a3c2_2668) |
| Volatility of the FVOCI portfolio in the liquidity pool | [358](#i4be61753b7f243b19551b0bfbf3a2a0d_778) |
|  | | |
|  | | |
|  | | |
|  | | |

Liquidity  risk

All disclosures in this section are

unaudited unless otherwise stated.

Overview

The Group Liquidity Risk is managed within

Treasury and Capital Risk framework and

is designed to maintain liquidity resources

that are sufficient in amount and quality,

and a funding profile that is appropriate to

meet the Group’s Liquidity Risk Appetite

and PRA Regulatory requirements. The

liquidity risk framework is delivered via a

combination of policy formation, review

and governance, analysis, stress testing,

limit setting and monitoring.

This section provides an analysis of the

Group’s: (i) summary of performance, (ii)

liquidity risk stress testing, iii) liquidity

regulation, iv) liquidity pool, (v) funding

structure and funding relationships, (vi)

credit ratings, and (vii) contractual

maturity of financial assets and liabilities.

For further detail on liquidity risk

governance and framework, refer to

pages 172 to 174 of the Barclays PLC Pillar

3 Report 2023 (unaudited).

Key metrics

Liquidity Coverage  Ratio1

161%

Net Stable Funding Ratio2

138%

1 LCR represents average  of the last 12 spot month end

ratios.

2 NSFR represents average of the last four spot quarter

end ratios.

Summary of performance

The liquidity pool at £298bn ( December

2022:  £318bn) reflects the Group’s

prudent approach to liquidity

management. The Average Liquidity

Coverage Ratio (LCR) remained well above

the 100% regulatory requirement at 161%

(December 2022: 156%), equivalent to a

surplus of 118bn (December 2022:

£114bn).

The decrease in the liquidity pool over the

year was driven by a decrease in wholesale

funding, a slight reduction in net deposits

where a decrease in  Barclays UK deposits

is largely offset by a growth in Corporate

Bank deposits, and changes in business

funding consumption. A decrease in net

stress outflows led by an increase in the

proportion of corporate deposits treated

as operational led to an increase in the

LCR ratio. The Net Stable Funding Ratio

(average of last four quarter ends) was

138%, which represents a surplus of

£167bn above the 100% regulatory

requirement.

During the year, the Group issued £14.1bn

of minimum requirement for own funds

and eligible liabilities (MREL) instruments in

a range of tenors and currencies.

Barclays Bank PLC continued to issue in

the shorter-term and medium-term

markets and Barclays Bank UK PLC

continued to issue in the shorter-term

markets and maintain active secured

funding programmes. This funding

capacity enables the respective entities to

maintain their stable and diversified

funding bases.

The Group’s reliance on short-term

wholesale funding, as measured by the

proportion of wholesale funding maturing

in less than one year decreased year-on-

year to 33% (December 2022: 39%).

Liquidity risk stress testing

Barclays’ Liquidity Risk is managed within

the Principal Risk: Treasury and Capital

Risk Framework.  Under this framework,

the Group has established a liquidity risk

appetite together with the appropriate

limits for the management of the liquidity

risk. This is the level of liquidity risk the

Group chooses to take in pursuit of its

business objectives and in meeting its

regulatory obligations. The Group sets its

internal liquidity risk appetite based on

internal liquidity risk stress tests and,

external regulatory requirements namely

the Liquidity Coverage Ratio (LCR) and

Net Stable Funding Ratio (NSFR).

Internal Liquidity Stress Tests (ILST

formally known as LRA)

The Internal Liquidity Risk Stress Test

measures the potential contractual and

contingent stress outflows under a range

of internally defined stress scenarios,

which are then used to determine the size

of the liquidity pool that is immediately

available to meet anticipated outflows

should a stress occur.

As part of the ILST, the Group runs four

liquidity stress scenarios, aligned to the

PRA’s prescribed stresses:

• 90 days market-wide stress event

• 30 days Barclays-specific stress event

• 30 days combined market-wide and

Barclays-specific stress event

• 12 months market wide stress

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 339 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Key ILST assumptions

For the year ended 31 December 2023

|  |  |
| --- | --- |
|  |  |
| Drivers of Liquidity Risk | ILST Combined stress – key assumptions |
| Wholesale Secured and Unsecured Funding Risk | Zero rollover of maturing wholesale unsecured funding |
| Partial loss of repo capacity on non-extremely liquid repos at contractual maturity date |
| Roll of repo for extremely liquid repo at wider haircut at contractual maturity date |
| Withdrawal of contractual buyback obligations, excess client futures margin, Prime Brokerage  (PB) client cash and overlifts |
|  | Haircuts applied to the market value of marketable assets held in the liquidity buffer |
| Retail and Corporate Funding Risk | Retail and Corporate deposit outflows as counterparties seek to diversify their deposit balances |
| Intraday Liquidity Risk | Liquidity held to meet increased intraday liquidity usage due to payment and receipts volatility,  loss of unsecured credit lines and haircuts applied to collateral values used to back secured credit  lines, in a stress |
| Intra-Group Liquidity Risk | Liquidity support for material subsidiaries. Surplus liquidity held within certain subsidiaries is not  taken as a benefit to the wider Group |
| Cross-Currency Liquidity Risk | Deterioration in FX market capacity that may result in restriction in net currency positions  (managed as a separate framework) |
| Off-Balance Sheet Liquidity Risk | Drawdown on committed facilities based on facility and counterparty type |
|  | Collateral outflows due to a two-notch credit rating downgrade |
|  | Increase in the Group's initial margin requirement across all major exchanges |
|  | Variation margin outflows from collateralised risk positions |
|  | Outflow of collateral owing but not called |
|  | Loss of internal sources of funding within the PB synthetics business |
| Franchise-Viability Risk | Liquidity held to enable the firm to meet select non-contractual obligations to ensure market  confidence in the firm is maintained, including debt buy-backs, swap tear-ups and increased  prime brokerage margin debits |
| Funding Concentration Risk | Funding from counterparties providing greater than 1% of total funding |

As at 31 December 2023, the Group held eligible liquid assets well in excess of 100% of net stress outflows of the 30 days combined

scenario, which has the highest net outflows of the three short-term liquidity stress scenarios and the 12 month market-wide scenario.

Liquidity regulation

Barclays Group monitors its position against both the LCR and NSFR according to the PRA regulatory requirements which include

certain Basel III standards that were retained in the UK regulatory framework from 1 January 2022 as part of the UK's withdrawal from

the EU.  The LCR requirement takes into account the relative stability of different sources of funding and potential incremental funding

requirements in a stress. The LCR is designed to promote short-term resilience of a bank's liquidity risk profile by holding sufficient High

Quality Liquid Assets (HQLA) to survive an acute stress scenario lasting for 30 days. The NSFR has been developed to promote a

sustainable and stable structure of assets and liabilities.

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| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Liquidity coverage ratio

The external LCR requirement is designed to promote short-term resilience of a bank’s liquidity risk profile by holding sufficient High

Quality Liquid Assets (HQLA) to survive an acute stress scenario lasting for 30 days.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Liquidity Coverage Ratio (LCR)1 | 2023 | 2022 |
| As at 31 December | £bn | £bn |
| LCR Eligible High Quality Liquid Assets (HQLA) | 310 | 320 |
| Net stress outflows | (192) | (206) |
| Surplus | 118 | 114 |
| Liquidity coverage ratio | 161% | 156% |

Note

1  Liquidity Coverage Ratio is now shown on an average basis, based on the average of the last 12 spot month end ratios. The HQLA, Net Stress outflow, and Surplus  balances in the table

above are average month end balances for the past 12 months. Prior period HQLA, Net Stress Outflows, Surplus & LCR comparatives have been updated for consistency.

Net Stable Funding Ratio (NSFR)

The external NSFR metric requires banks to maintain a stable funding profile taking into account both on and certain off balance sheet

exposures over a medium to long term period. The ratio is defined as the Available Stable Funding (capital and certain liabilities which are

defined as stable sources of funding) relative to the Required Stable Funding (a measure of assets on the balance sheet and certain off

balance sheet exposures which may require longer term funding). The NSFR was 138% at December 2023 ( December 2022: 137%)

(average of last four quarter ends) equivalent to a surplus of £167bn (2022: £155bn) above the regulatory requirement and

demonstrates Barclays’ stable balance sheet funding profile.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
| Net Stable Funding Ratio (NSFR)1 | £bn | £bn |
| Total Available Stable Funding | 607 | 576 |
| Total Required Stable Funding | 440 | 421 |
| Surplus | 167 | 155 |
| Net Stable Funding Ratio | 138% | 137% |

Note

1 Average represents the last four spot quarter end ratios.

As part of the liquidity risk appetite, Barclays establishes minimum LCR, NSFR and internal liquidity stress test limits. The Group plans to

maintain its surplus to the internal and regulatory requirements at an efficient level. Risks to market funding conditions, the Group’s

liquidity position and funding profile are assessed continuously, and actions are taken to manage the size of the liquidity pool and the

funding profile as appropriate.

Liquidity pool

The Group liquidity pool as at 31 December 2023  was £298bn (2022: £318bn). In 2023, the month-end liquidity pool ranged from

£298bn to £342bn (2022: £309bn to £359bn), and the month-end average balance was £328bn (2022: £331bn). The liquidity pool is

held unencumbered and is intended to offset stress outflows. It comprises the following cash and unencumbered assets.

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Composition of the Group liquidity pool as at 31 December 2023 | | | | | | | | |
|  | LCR eligible High Quality Liquid Assets (HQLA)1 | | | | |  | Liquidity pool | |
|  | Cash | Level 1 | Level 2A | Level 2B | Total |  | 2023 | 2022 |
|  | £bn | £bn | £bn | £bn | £bn |  | £bn | £bn |
| Cash and deposits with central banks2 | 211 |  |  |  | 211 |  | 232 | 263 |
|  |  |  |  |  |  |  |  |  |
| Government bonds3 |  |  |  |  |  |  |  |  |
| AAA to AA- |  | 40 | 5 |  | 45 |  | 48 | 39 |
| A+ to A- |  | 1 | 1 |  | 2 |  | 1 | 3 |
| BBB+ to BBB- |  | 1 |  |  | 1 |  | 1 | — |
| Total government bonds |  | 42 | 6 |  | 48 |  | 50 | 42 |
|  |  |  |  |  |  |  |  |  |
| Other |  |  |  |  |  |  |  |  |
| Government guaranteed issuers, PSEs and GSEs |  | 4 |  |  | 4 |  | 5 | 6 |
| International organisations and MDBs |  | 3 |  |  | 3 |  | 3 | 2 |
| Covered bonds |  | 3 | 3 |  | 6 |  | 7 | 5 |
| Other |  |  |  | 2 | 2 |  | 1 | — |
| Total other |  | 10 | 3 | 2 | 15 |  | 16 | 13 |
|  |  |  |  |  |  |  |  |  |
| Total as at 31 December 2023 | 211 | 52 | 9 | 2 | 274 |  | 298 |  |
| Total as at 31 December 2022 | 248 | 31 | 15 | 1 | 295 |  |  | 318 |

Notes

1 The LCR eligible HQLA is adjusted for operational restrictions upon consolidation under Article 8 of the Liquidity Coverage Ratio section of the PRA rulebook (CRR) such as trapped

liquidity within Barclays subsidiaries. It also reflects differences in eligibility of assets between the LCR and Barclays’ Liquidity Pool.

2 Includes cash held at central banks and surplus cash at central banks related to payment schemes. Of which over 99% (2022: over 99%) was placed with the Bank of England, US Federal

Reserve, European Central Bank, Bank of Japan and Swiss National Bank.

3 Of which over 80% (2022: over 79%) comprised UK, US, French, German, Japanese, Swiss and Dutch securities.

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| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

The Group liquidity pool is well diversified by major currency and the Group monitors ILST stress scenarios for major currencies.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Liquidity pool by currency |  |  |  |  |  |
|  | USD | EUR | GBP | Other | Total |
|  | £bn | £bn | £bn | £bn | £bn |
| Liquidity pool as at 31 December 2023 | 82 | 76 | 117 | 23 | 298 |
| Liquidity pool as at 31 December 2022 | 72 | 79 | 142 | 25 | 318 |

Management of the liquidity pool

The composition of the liquidity pool is subject to limits set by the Board and the independent liquidity risk, credit risk and market risk

functions. In addition, the investment of the liquidity pool is monitored for concentration risk by issuer, currency and asset type. Given

the returns generated by these highly liquid assets, the risk and reward profile is continuously managed.

As at 31 December 2023, 59% (2022: 60%) of the liquidity pool was located in Barclays Bank PLC, 22% (2022: 25%) in Barclays Bank UK

PLC and 11% (2022: 9%) in Barclays Bank Ireland PLC. The residual portion of the liquidity pool is held outside of these entities,

predominantly in the US subsidiaries, to meet entity-specific stress outflows and local regulatory requirements. To the extent the use

of this portion of the liquidity pool is restricted due to local regulatory requirements, it is assumed to be unavailable to the rest of the

Group in calculating the LCR.

Contingent liquidity

In addition to the Group liquidity pool, the Group has access to other unencumbered assets which provide a source of contingent

liquidity. While these are not relied on in the Group’s ILST, a portion of these assets may be monetised in a stress to generate liquidity

through their use as collateral for secured funding or through outright sale.

In a Barclays-specific, market-wide or combined liquidity stress, liquidity available via market sources could be severely disrupted. In

circumstances where market liquidity is unavailable or available only at significantly elevated prices, the Group could generate liquidity

via central bank facilities. To this end, as at 31 December 2023, the Group had £72.5bn (December 2022: £83.3bn) of assets positioned

at various central banks.

For more detail on the Group’s other unencumbered assets, see pages 197 to 201 of the Barclays PLC Pillar 3 Report 2023 (unaudited).

Funding structure and funding relationships

The basis for sound liquidity risk management is a funding structure that reduces the probability of a liquidity stress leading to an inability

to meet funding obligations as they fall due. The Group’s overall funding strategy is to develop a diversified funding base (geographically,

by type and by counterparty) and maintain access to a variety of alternative funding sources, to provide protection against unexpected

fluctuations, while minimising the cost of funding.

Within this, the Group aims to align the sources and uses of funding. As such, retail and corporate loans and advances are largely funded

by deposits in the relevant entities, with the surplus primarily funding the liquidity pool. The majority of reverse repurchase agreements

are matched by repurchase agreements. Derivative liabilities and assets are largely matched. A substantial proportion of balance sheet

derivative positions qualify for counterparty netting and the remaining portions are largely offset when netted against cash collateral

received and paid. Wholesale debt and equity is used to fund residual assets.

These funding relationships are summarised below:

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | 2023 | 2022 |  |  | 2023 | 2022 |
| Assets | £bn | £bn |  | Liabilities | £bn | £bn |
| Loans and advances at amortised cost1 | 386 | 385 |  | Deposits at amortised cost | 539 | 546 |
| Group liquidity pool | 298 | 318 |  | <1 Year wholesale funding | 59 | 73 |
|  |  |  |  | >1 Year wholesale funding | 118 | 111 |
| Reverse repurchase agreements, trading  portfolio assets, cash collateral and  settlement balances | 435 | 412 |  | Repurchase agreements, trading portfolio  liabilities, cash collateral and settlement  balances | 380 | 370 |
| Derivative financial instruments | 257 | 302 |  | Derivative financial instruments | 250 | 290 |
| Other assets2 | 101 | 97 |  | Other liabilities | 59 | 55 |
|  |  |  |  | Equity | 72 | 69 |
| Total assets | 1,477 | 1,514 |  | Total liabilities | 1,477 | 1,514 |

Notes

1 Adjusted for liquidity pool debt securities reported at amortised costs of £18bn (December 2022: £14bn).

2 Other assets include fair value assets that are not part of reverse repurchase agreements or trading portfolio assets, and other asset categories.

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| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Deposit funding

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | 2023 | | | 2022 |
| Funding of loans and advances | Loans and  advances,debt  securities at  amortised cost | Deposits at  amortised cost | Loan: deposit  ratio 1 | Loan: deposit  ratio |
| As at 31 December 2023 | £bn | £bn | % | % |
| Barclays UK | 221 | 241 | 92% | 87% |
| Barclays International | 174 | 298 | 58% | 59% |
| Head Office | 4 |  |  |  |
| Barclays Group | 399 | 539 | 74% | 73% |

Note

1 The loan: deposit ratio is calculated as loans  and advances at amortised cost  and debt securities  at amortised cost  divided by deposits at amortised cost.

As at 31 December 2023, £224bn (2022: £224bn) of total customer deposits were insured through the UK Financial Services

Compensation Scheme (FSCS) and other similar schemes. In addition to these customer deposits £5.6bn (2022: £5.7bn) of other

liabilities are insured by other governments.

Contractually current accounts are repayable on demand and savings accounts at short notice. In practice, their observed maturity is

typically longer than their contractual maturity. Similarly, repayment profiles of certain types of assets e.g. mortgages, overdrafts and

credit card lending, differ from their contractual profiles. The Group therefore assesses the behavioural maturity of both customer

assets and liabilities to identify structural balance sheet funding gaps. In doing so, it applies quantitative modelling and qualitative

assessments which take into account historical experience, current customer composition, and macroeconomic projections.

The Group’s broad base of customers, numerically and by depositor type, helps protect against unexpected fluctuations in balances

and hence provides a stable funding base for the Group’s operations and liquidity needs.

Wholesale funding

Barclays Bank Group and Barclays Bank UK Group maintain access to a variety of sources of wholesale funds in major currencies,

including those available from term investors across a variety of distribution channels and geographies, short-term funding markets and

repo markets.

Barclays Bank Group has direct access to US, European and Asian capital markets through its global investment banking operations and

to long-term investors through its clients worldwide. Key sources of wholesale funding include money markets, certificates of deposit,

commercial paper, medium term issuances (including structured notes) and securitisations.

Key sources of wholesale funding for Barclays Bank UK Group include money markets, certificates of deposit, commercial paper,

covered bonds and other securitisations.

The Group expects to continue issuing public wholesale debt from Barclays PLC (the Parent company), in order to maintain compliance

with indicative MREL requirements and maintain a stable and diverse funding base by type, currency and market. During the year, the

Group issued £14.1bn of MREL instruments from Barclays PLC  in a range of different currencies and tenors.

Barclays Bank PLC continued to issue in the shorter-term markets and maintain active medium-term notes programmes. Barclays

Bank UK PLC continued to issue in the shorter-term markets and maintain active secured funding programmes. This funding capacity

enables the respective entities to maintain their stable and diversified funding bases.

As at 31 December 2023, the Group’s total wholesale funding outstanding (excluding repurchase agreements) was £176.8bn (2022:

£184.0bn), of which £19.0bn (2022: £19.2bn) was secured funding and £157.8bn (2022: £164.8bn) unsecured funding. Unsecured

funding includes £69.2bn (2022: £59.7bn) of privately placed senior unsecured notes issued through a variety of distribution channels

including intermediaries and private banks.

Wholesale funding of £58.6bn (2022: £72.5bn) matures in less than one year, representing 33% (December 2022: 39%) of total

wholesale funding outstanding. This includes £18.7bn (2022: £15.0bn) related to term funding2. Although not a requirement, the

liquidity pool exceeded the wholesale funding maturing in less than one year by £239bn (2022: £246bn).

Barclays Bank Group and Barclays Bank UK Group also support various central bank monetary initiatives, such as the Bank of England’s

Term Funding Scheme with additional incentives for SMEs (TFSME), and the European Central Bank’s Targeted Long-Term Refinancing

Operations (TLTRO). These are reported under ‘repurchase agreements and other similar secured borrowing’ on the balance sheet.

In 2023, Barclays repaid £0.9bn of its TLTRO drawings, reducing its outstanding balance to £0.5bn as at 31 December 2023. In addition,

the total outstanding principal amount of TFSME remained at £21.9bn at year end.

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| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Maturity profile of wholesale funding1,2 | |  |  |  |  |  |  |  |  |  |  |
|  | <1 month | 1-3  months | 3-6  months | 6-12  months | <1 year | 1-2 years | 2-3 years | 3-4 years | 4-5 years | >5 years | Total |
|  | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn |
| Barclays PLC (the Parent company) |  |  |  |  |  |  |  |  |  |  |  |
| Senior unsecured (Public benchmark) | 1.2 | — | 0.3 | — | 1.5 | 5.5 | 9.7 | 5.9 | 4.7 | 20.0 | 47.3 |
| Senior unsecured (Privately placed) | — | — | — | — | — | — | — | — | — | 1.0 | 1.0 |
| Subordinated liabilities | — | — | — | 0.4 | 0.4 | — | 1.5 | — | 1.5 | 5.8 | 9.2 |
| Barclays Bank PLC (including  subsidiaries) |  |  |  |  |  |  |  |  |  |  |  |
| Certificates of deposit and commercial  paper | 0.6 | 9.7 | 8.6 | 7.5 | 26.4 | 1.3 | — | — | — | — | 27.7 |
| Asset backed commercial paper | 2.4 | 8.2 | 1.0 | — | 11.6 | — | — | — | — | — | 11.6 |
| Senior unsecured (Public benchmark) | — | — | 1.0 | — | 1.0 | — | — | — | — | — | 1.0 |
| Senior unsecured (Privately placed)3 | 1.4 | 1.6 | 2.9 | 8.5 | 14.4 | 12.1 | 8.4 | 5.2 | 7.0 | 21.1 | 68.2 |
| Asset backed securities | — | — | 0.1 | 1.0 | 1.1 | 1.2 | 0.5 | — | 0.1 | 3.1 | 6.0 |
| Subordinated liabilities | — | 0.1 | — | 0.2 | 0.3 | 0.2 | 0.3 | 0.1 | — | 0.4 | 1.3 |
| Barclays Bank UK PLC (including  subsidiaries) |  |  |  |  |  |  |  |  |  |  |  |
| Certificates of deposit and commercial  paper | 1.9 | — | — | — | 1.9 | — | — | — | — | — | 1.9 |
| Senior unsecured (Public benchmark) | — | — | — | — | — | — | — | — | — | 0.2 | 0.2 |
| Covered bonds | — | — | — | — | — | — | — | 0.5 | 0.2 | 0.7 | 1.4 |
| Total as at 31 December 23 | 7.5 | 19.6 | 13.9 | 17.6 | 58.6 | 20.3 | 20.4 | 11.7 | 13.5 | 52.3 | 176.8 |
| Of which secured | 2.4 | 8.2 | 1.1 | 1.0 | 12.7 | 1.2 | 0.5 | 0.5 | 0.3 | 3.8 | 19.0 |
| Of which unsecured | 5.1 | 11.4 | 12.8 | 16.6 | 45.9 | 19.1 | 19.9 | 11.2 | 13.2 | 48.5 | 157.8 |
| Total as at 31 December 22 | 11.1 | 26.5 | 16.4 | 18.5 | 72.5 | 22.4 | 16.9 | 14.5 | 9.7 | 48.0 | 184.0 |
| Of which secured | 4.9 | 6.7 | 1.3 | 0.2 | 13.1 | 1.8 | 0.7 | 0.5 | 1.0 | 2.1 | 19.2 |
| Of which unsecured | 6.2 | 19.8 | 15.1 | 18.3 | 59.4 | 20.6 | 16.2 | 14.0 | 8.7 | 45.9 | 164.8 |

Notes

1 The composition of wholesale funds comprises the balance sheet reported financial liabilities at fair value, debt securities in issue and subordinated liabilities. It does not include

participation in the central bank facilities reported within repurchase agreements and other similar secured borrowing.

2 Term funding comprises public benchmark and privately placed senior unsecured notes, covered bonds, asset-backed securities and subordinated debt where the original maturity of

the instrument was more than one year.

3 Includes structured notes of £54.7bn, of which £11.5bn matures within one year.

Currency composition of wholesale debt

As at 31 December 2023, the proportion of wholesale funding by major currencies was as follows:

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Currency composition of wholesale funding |  |  |  |  |
|  | USD | EUR | GBP | Other |
|  | % | % | % | % |
| Certificates of deposit and commercial paper | 74 | 19 | 6 | 1 |
| Asset backed commercial paper | 83 | 11 | 6 | — |
| Senior unsecured (Public benchmark) | 61 | 22 | 13 | 4 |
| Senior unsecured (Privately placed) | 55 | 20 | 5 | 20 |
| Covered bonds / Asset backed securities | 80 | 13 | 7 | — |
| Subordinated liabilities | 72 | 9 | 17 | 2 |
| Total as 31 December 2023 | 64 | 19 | 8 | 9 |
| Total as 31 December 2022 | 61 | 22 | 11 | 6 |

To manage cross currency refinancing risk, the Group manages to currency mismatch limits, which limit risk at specific maturities.

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| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Credit ratings

In addition to monitoring and managing key metrics related to the financial strength of the Group, Barclays also solicits independent

credit ratings from Standard & Poor’s Global (S&P), Moody’s, Fitch, and Rating and Investment Information (R&I). These ratings assess

the creditworthiness of the Group, its subsidiaries and its branches, and are based on reviews of a broad range of business and financial

attributes including capital strength, profitability, funding, liquidity, asset quality, strategy and governance.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Credit ratings |  |  |  |
| As at 31 December 2023 | Standard & Poor's | Moody's | Fitch |
| Barclays Bank PLC |  |  |  |
| Long term | A+/Stable | A1/Stable | A+/Stable |
| Short term | A-1 | P-1 | F1 |
| Barclays Bank UK PLC |  |  |  |
| Long term | A+/Stable | A1/Stable | A+/Stable |
| Short term | A-1 | P-1 | F1 |
| Barclays PLC |  |  |  |
| Long term | BBB+/Stable | Baa1/Stable | A/Stable |
| Short term | A-2 | P-2 | F1 |

In March 2023, Moody’s upgraded Barclays PLC’s long-term rating by one notch to Baa1 and reverted the outlook to stable, reflecting

Moody's expectation that the Group’s earnings will be higher, more diversified and more sustainable than before, while asset risk will

remain broadly stable and capital and liquidity will remain strong. This followed the review for upgrade that had been placed on Barclays

PLC in December 2022. Moody’s also revised Barclays Bank PLC’s outlook to stable from negative, reflecting Moody’s expectation that

the Bank’s capital and liquidity will remain strong and whilst profitability will reduce from the exceptional levels of the last couple of years

for capital markets and investment banking, it will remain sound due to improving income from other businesses and lower litigation and

conduct costs.

In May 2023, S&P upgraded all Barclays rated entities by one notch and reverted the outlooks to stable, reflecting S&P’s view that

Barclays PLC's diversified international banking franchise has performed well against a difficult economic and financial backdrop and

S&P's expectation that Barclays PLC will generate solid earnings over the next 12-24 months, even as interest rates approach their

peak. This action upgraded Barclays PLC’s long-term rating to BBB+ and Barclays Bank PLC and Barclays Bank UK PLC’s long-term

ratings to A+.

In July 2023, Fitch affirmed all ratings for Barclays PLC, Barclays Bank PLC and Barclays Bank UK PLC.

Barclays also solicits issuer ratings from R&I and the ratings of A for Barclays PLC and A+ for Barclays Bank PLC were affirmed in

November 2023 with stable outlooks.

A credit rating downgrade could result in outflows to meet collateral requirements on existing contracts. Outflows related to credit

rating downgrades are included in the ILST stress scenarios and a portion of the liquidity pool is held against this risk. Credit ratings

downgrades could also result in reduced funding capacity and increased funding costs.

The contractual collateral requirement following one- and two-notch long-term and associated short-term downgrades across all

credit rating agencies, would result in outflows of £1bn and £2bn respectively, and are provided for in determining an appropriate

liquidity pool size given the Group’s liquidity risk appetite. These numbers do not assume any management or restructuring actions that

could be taken to reduce posting requirements. These outflows do not include the potential liquidity impact from loss of unsecured

funding, such as from money market funds, or loss of secured funding capacity. However, unsecured and secured funding stresses are

included in the ILST stress scenarios and a portion of the liquidity pool is held against these risks.

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| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Contractual maturity of financial assets and liabilities

The table below provides detail on the contractual maturity of all financial instruments and other assets and liabilities. Derivatives (other

than those designated in a hedging relationship) and trading portfolio assets and liabilities are included in the ‘not more than one month'

column at their fair value. Liquidity risk on these items is not managed on the basis of contractual maturity since they are not held for

settlement according to such maturity and will frequently be settled before contractual maturity at fair value. Derivatives designated in a

hedging relationship are included according to their contractual maturity.

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Contractual maturity of financial assets and liabilities (audited) | | | | | | | | |
| As at 31 December 2023 | Not more  than one  month | Over one  month but  not more  than three  months | Over three  months but  not more  than six  months | Over six  months but  not more  than one year | Over one  year but not  more than  three years | Over three  years but not  more than  five years | Over five  years | Total |
| £m | £m | £m | £m | £m | £m | £m | £m |
| Assets |  |  |  |  |  |  |  |  |
| Cash and balances at central banks | 224,634 | — | — | — | — | — | — | 224,634 |
| Cash collateral and settlement balances | 61,837 | 47,052 | — | — | — | — | — | 108,889 |
| Loans and advances at amortised cost to banks  and customers | 22,457 | 5,907 | 9,929 | 16,366 | 50,126 | 33,340 | 204,622 | 342,747 |
| Debt securities at amortised cost | 3 | 4,779 | 579 | 4,700 | 16,626 | 12,113 | 17,949 | 56,749 |
| Reverse repurchase agreements and other  similar secured lending | 1,435 | — | — | 34 | 1,123 | — | 2 | 2,594 |
| Trading portfolio assets | 174,605 | — | — | — | — | — | — | 174,605 |
| Financial assets at fair value through the income  statement | 158,213 | 17,761 | 6,214 | 5,902 | 11,119 | 2,966 | 4,476 | 206,651 |
| Derivative financial instruments | 254,655 | 100 | 91 | 160 | 1,070 | 533 | 227 | 256,836 |
| Financial assets at fair value through other  comprehensive income | 1,789 | 2,421 | 365 | 8,699 | 12,424 | 17,179 | 28,959 | 71,836 |
| Other financial assets | 2,122 | 26 | 36 | 9 | 1 | 1 | 2 | 2,197 |
| Total financial assets | 901,750 | 78,046 | 17,214 | 35,870 | 92,489 | 66,132 | 256,237 | 1,447,738 |
| Other assets |  |  |  |  |  |  |  | 29,749 |
| Total assets |  |  |  |  |  |  |  | 1,477,487 |
| Liabilities |  |  |  |  |  |  |  |  |
| Deposits at amortised cost from banks and  customers | 440,122 | 36,812 | 22,665 | 29,464 | 7,691 | 1,321 | 714 | 538,789 |
| Cash collateral and settlement balances | 65,227 | 28,857 | — | — | — | — | — | 94,084 |
| Repurchase agreements and other similar  secured borrowing | 12,164 | 12,433 | 1,307 | 247 | 8,279 | 7,092 | 79 | 41,601 |
| Debt securities in issue | 5,535 | 17,004 | 9,949 | 7,286 | 17,558 | 12,079 | 27,414 | 96,825 |
| Subordinated liabilities | — | 121 | — | 584 | 1,987 | 1,554 | 6,248 | 10,494 |
| Trading portfolio liabilities | 58,669 | — | — | — | — | — | — | 58,669 |
| Financial liabilities designated at fair value | 180,554 | 31,587 | 13,867 | 14,579 | 23,469 | 13,994 | 19,489 | 297,539 |
| Derivative financial instruments | 249,481 | 21 | — | 24 | 82 | 64 | 372 | 250,044 |
| Other financial liabilities | 6,492 | 265 | 40 | 77 | 266 | 182 | 377 | 7,699 |
| Total financial liabilities | 1,018,244 | 127,100 | 47,828 | 52,261 | 59,332 | 36,286 | 54,693 | 1,395,744 |
| Other liabilities |  |  |  |  |  |  |  | 9,879 |
| Total liabilities |  |  |  |  |  |  |  | 1,405,623 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Contractual maturity of financial assets and liabilities (audited) | | | | | | | | |
| As at 31 December 2022 | Not more  than one  month | Over one  month but  not more  than three  months | Over three  months but  not more  than six  months | Over six  months but  not more  than one year | Over one  year but not  more than  three years | Over three  years but not  more than  five years | Over five  years | Total |
| £m | £m | £m | £m | £m | £m | £m | £m |
| Assets |  |  |  |  |  |  |  |  |
| Cash and balances at central banks | 256,351 | — | — | — | — | — | — | 256,351 |
| Cash collateral and settlement balances | 62,295 | 50,302 | — | — | — | — | — | 112,597 |
| Loans and advances at amortised cost to banks  and customers | 22,581 | 6,644 | 9,104 | 17,663 | 49,259 | 43,551 | 204,490 | 353,292 |
| Debt securities at amortised cost | — | 1,258 | 612 | 2,554 | 14,856 | 12,968 | 13,239 | 45,487 |
| Reverse repurchase agreements and other similar  secured lending | 442 | 333 | — | — | — | — | 1 | 776 |
| Trading portfolio assets | 133,813 | — | — | — | — | — | — | 133,813 |
| Financial assets at fair value through the income  statement | 158,699 | 21,016 | 6,771 | 6,765 | 11,413 | 3,292 | 5,612 | 213,568 |
| Derivative financial instruments | 301,679 | 22 | 66 | 70 | 462 | 44 | 37 | 302,380 |
| Financial assets at fair value through other  comprehensive income | 2,908 | 3,533 | 4,535 | 3,082 | 16,766 | 16,418 | 17,820 | 65,062 |
| Other financial assets | 1,561 | 49 | — | 43 | — | 1 | 2 | 1,656 |
| Total financial assets | 940,329 | 83,157 | 21,088 | 30,177 | 92,756 | 76,274 | 241,201 | 1,484,982 |
| Other assets |  |  |  |  |  |  |  | 28,717 |
| Total assets |  |  |  |  |  |  |  | 1,513,699 |
| Liabilities |  |  |  |  |  |  |  |  |
| Deposits at amortised cost from banks and  customers | 477,022 | 29,790 | 19,388 | 13,665 | 4,590 | 499 | 828 | 545,782 |
| Cash collateral and settlement balances | 68,930 | 27,997 | — | — | — | — | — | 96,927 |
| Repurchase agreements and other similar  secured borrowing | 9,419 | 399 | — | 943 | 6,139 | 10,069 | 83 | 27,052 |
| Debt securities in issue | 9,621 | 23,488 | 13,259 | 11,876 | 16,252 | 14,808 | 23,577 | 112,881 |
| Subordinated liabilities | — | 17 | — | 262 | 1,181 | 1,987 | 7,976 | 11,423 |
| Trading portfolio liabilities | 72,924 | — | — | — | — | — | — | 72,924 |
| Financial liabilities designated at fair value | 171,096 | 26,481 | 14,352 | 9,104 | 24,548 | 8,528 | 17,528 | 271,637 |
| Derivative financial instruments | 288,582 | 36 | 63 | 7 | 262 | 273 | 397 | 289,620 |
| Other financial liabilities | 7,841 | 48 | 43 | 84 | 409 | 247 | 484 | 9,156 |
| Total financial liabilities | 1,105,435 | 108,256 | 47,105 | 35,941 | 53,381 | 36,411 | 50,873 | 1,437,402 |
| Other liabilities |  |  |  |  |  |  |  | 7,037 |
| Total liabilities |  |  |  |  |  |  |  | 1,444,439 |

Expected maturity date may differ from the contractual dates, to account for:

• trading portfolio assets and liabilities and derivative financial instruments, which may not be held to maturity as part of the Group’s trading

strategies

• corporate and retail deposits, reported under deposits at amortised cost, are repayable on demand or at short notice on a contractual basis.

In practice, their behavioural maturity is typically longer than their contractual maturity, and therefore these deposits provide stable funding

for the Group’s operations and liquidity needs because of the broad base of customers, both numerically and by depositor type

• loans to corporate and retail customers, which are included within loans and advances at amortised cost and financial assets at fair value, may

be repaid earlier in line with terms and conditions of the contract

• debt securities in issue, subordinated liabilities, and financial liabilities designated at fair value, may include early redemption features.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 347 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Contractual maturity of financial liabilities on an undiscounted basis

The table below presents the cash flows payable by the Group under financial liabilities by remaining contractual maturities at the

balance sheet date. The amounts disclosed in the table are the contractual undiscounted cash flows of all financial liabilities (i.e. nominal

values).

The balances in the below table do not agree directly to the balances in the consolidated balance sheet as the table incorporates all

cash flows, on an undiscounted basis, related to both principal as well as those associated with all future coupon payments.

Derivative financial instruments held for trading and trading portfolio liabilities are included in the 'not more than one month' column at

their fair value.

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Contractual maturity of financial liabilities - undiscounted (audited) | | | | | | | | |
|  | Not  more  than one  month | Over one  month but  not more  than three  months | Over three  months but  not more  than six  months | Over six  months but  not more  than one year | Over one  year but not  more than  three years | Over three  years but not  more than  five years | Over five  years | Total |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| As at 31 December 2023 |  |  |  |  |  |  |  |  |
| Deposits at amortised cost from banks and  customers | 440,184 | 37,101 | 23,055 | 30,377 | 8,107 | 1,540 | 882 | 541,246 |
| Cash collateral and settlement balances | 65,230 | 29,096 | — | — | — | — | — | 94,326 |
| Repurchase agreements and other similar  secured borrowing | 12,196 | 12,516 | 1,326 | 252 | 9,042 | 7,902 | 213 | 43,447 |
| Debt securities in issue | 5,546 | 17,142 | 10,121 | 7,481 | 18,674 | 13,688 | 40,154 | 112,806 |
| Subordinated liabilities | — | 121 | — | 601 | 2,241 | 1,822 | 8,594 | 13,379 |
| Trading portfolio liabilities | 58,669 | — | — | — | — | — | — | 58,669 |
| Financial liabilities designated at fair value | 180,687 | 31,794 | 14,174 | 15,013 | 24,891 | 15,309 | 34,035 | 315,903 |
| Derivative financial instruments | 249,482 | 21 | — | 24 | 90 | 75 | 705 | 250,397 |
| Other financial liabilities | 6,492 | 269 | 45 | 89 | 309 | 220 | 615 | 8,039 |
| Total financial liabilities | 1,018,486 | 128,060 | 48,721 | 53,837 | 63,354 | 40,556 | 85,198 | 1,438,212 |
| As at 31 December 2022 |  |  |  |  |  |  |  |  |
| Deposits at amortised cost from banks and  customers | 477,050 | 29,921 | 19,393 | 13,798 | 4,606 | 499 | 1,082 | 546,349 |
| Cash collateral and settlement balances | 68,930 | 28,185 | — | — | — | — | — | 97,115 |
| Repurchase agreements and other similar  secured borrowing | 9,430 | 401 | — | 946 | 6,920 | 12,234 | 252 | 30,183 |
| Debt securities in issue | 9,646 | 23,580 | 13,375 | 12,165 | 16,964 | 16,790 | 34,078 | 126,598 |
| Subordinated liabilities | — | 17 | — | 263 | 1,274 | 2,356 | 10,331 | 14,241 |
| Trading portfolio liabilities | 72,924 | — | — | — | — | — | — | 72,924 |
| Financial liabilities designated at fair value | 171,296 | 26,674 | 14,905 | 9,399 | 25,662 | 9,847 | 33,099 | 290,882 |
| Derivative financial instruments | 288,582 | 98 | 101 | 8 | 290 | 321 | 793 | 290,193 |
| Other financial liabilities | 7,841 | 58 | 56 | 109 | 488 | 308 | 564 | 9,424 |
| Total financial liabilities | 1,105,699 | 108,934 | 47,830 | 36,688 | 56,204 | 42,355 | 80,199 | 1,477,909 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 348 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Maturity of off-balance sheet commitments given

The table below presents the maturity split of the Group’s off-balance sheet commitments given at the balance sheet date. The

amounts disclosed in the table are the undiscounted cash flows (i.e. nominal values) on the basis of earliest opportunity at which they

are available.

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Maturity analysis of off-balance sheet commitments given (audited) | | | | | | | | |
|  | Not more than  one month | Over one month  but not more  than three  months | Over three months  but not more than  six months | Over six months  but not more  than one year | Over one  year but not  more than  three years | Over three years  but not more  than five years | Over five  years | Total |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| As at 31 December 2023 |  |  |  |  |  |  |  |  |
| Contingent liabilities and financial  guarantees | 25,217 | 119 | 2 | 1 | 1 | — | — | 25,340 |
| Documentary credits and other short-  term trade related transactions | 2,348 | 3 | 1 | — | — | — | — | 2,352 |
| Standby facilities, credit lines and other  commitments | 388,030 | — | — | — | 55 | — | — | 388,085 |
| Total off-balance sheet  commitments given | 415,595 | 122 | 3 | 1 | 56 | — | — | 415,777 |
|  |  |  |  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |  |  |  |
| Contingent liabilities and financial  guarantees | 24,118 | 71 | 14 | 1 | 1 | — | — | 24,205 |
| Documentary credits and other short-  term trade related transactions | 1,742 | 1 | 5 | — | — | — | — | 1,748 |
| Standby facilities, credit lines and other  commitments | 393,723 | — | — | — | 37 | — | — | 393,760 |
| Total off-balance sheet  commitments given | 419,583 | 72 | 19 | 1 | 38 | — | — | 419,713 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Capital risk

All disclosures in this section are unaudited

unless otherwise stated.

Overview

The CET1 ratio, among other metrics, is a

measure of the capital strength and

resilience of Barclays. Maintenance of our

capital resources is vital in order to meet

the overall regulatory capital requirement,

to withstand the impact of the risks that

may arise under normal and stressed

conditions, and maintain adequate capital

to cover current and forecast business

needs and associated risks to provide a

viable and sustainable business offering.

This section provides an overview of the

Group’s: (i) CET1 capital, leverage and own

funds and eligible liabilities requirements;

(ii) capital resources; (iii) risk weighted

assets (RWAs); (iv) leverage ratios and

exposures; and (v) own funds and eligible

liabilities.

More details on monitoring and managing

capital risk may be found in the risk

management sections of the Barclays PLC

Pillar 3 Report  2023 (unaudited).

Key metrics

Common Equity Tier 1 ratio

13.8%

UK leverage ratio

5.2%

Own funds and eligible liabilities ratio as a

percentage of RWAs

33.6%

Summary of performance in the

period

The Group continues to be in excess of

overall capital, leverage and MREL

regulatory requirements.

The CET1 ratio decreased to 13.8%

(December 2022: 13.9%) as RWAs

increased by £6.2bn to £342.7bn

partially offset by an increase in CET1

capital of £0.4bn to £47.3bn

▪ c.125bps increase from 2023

attributable profit, including the c.25bps

negative impact of structural cost

actions, of which c.10bps are offset in

other capital movements

▪ c.70bps decrease driven by returns to

shareholders including the 8p per share

total dividend and £1.25bn of share

buybacks announced with FY22 and

H123 results

▪ c.10bps decrease from other capital

movements, including the impact of

regulatory change on 1 January 2023

relating to IFRS 9 transitional relief, the

impact of the KMC acquisition, and

movements in other regulatory capital

deductions

▪ c.50bps decrease as a result of a

£13.2bn increase in RWAs excluding the

impact of foreign exchange

movements, primarily driven by higher

CIB and CC&P RWAs

▪ An £8.2bn decrease in RWAs as a result

of foreign exchange movements was

offset by a £1.1bn decrease in CET1

capital due to a decrease in the currency

translation reserve

The UK leverage ratio decreased to 5.2%

(December 2022: 5.3%) primarily due to a

£38.3bn increase in leverage exposure to

£1,168.3bn, largely driven by an increase in

trading portfolio assets within Global

Markets

Minimum capital requirements

The Group’s Overall Capital Requirement

for CET1 increased to 12.0%, following the

latest PRA Individual Capital Requirement

(ICR) notice and comprises a 4.5% Pillar 1

minimum, a 2.5% Capital Conservation

Buffer (CCB), a 1.5% Global Systemically

Important Institution (G-SII) buffer, a 2.6%

Pillar 2A requirement and a 0.9%

Countercyclical Capital Buffer (CCyB).

The Group’s CCyB is based on the buffer

rate applicable for each jurisdiction in which

the Group has exposures. Following the

Financial Policy Committee (FPC)

announcement on 5 July 2022, the UK

CCyB increased from 1% to 2% with effect

from 5 July 2023. The buffer rates set by

other national authorities for non-UK

exposures are not currently material.

The Group’s updated Pillar 2A requirement

increased by 25bps to 4.6% of which at

least 56.25% needs to be met with CET1

capital, equating to 2.6% of RWAs. The

Pillar 2A requirement, based on a point in

time assessment, has been set as a

proportion of RWAs and is subject to at

least annual review.

The Group’s CET1 target ratio of 13-14%

takes into account headroom above

requirements which includes a confidential

institution-specific PRA buffer. The Group

remains above its minimum capital

regulatory requirements including the PRA

buffer.

Minimum leverage requirements

The Group is subject to a UK leverage ratio

requirement of 4.1% as at 31 December

2023. This comprises the  3.25% minimum

requirement, a G-SII additional leverage

ratio buffer (G-SII ALRB) of 0.53% and a

countercyclical leverage ratio buffer

(CCLB) of 0.3%.

The Group is also required to disclose an

average UK leverage ratio which is based

on capital on the last day of each month in

the quarter and an exposure measure for

each day in the quarter.

Minimum requirements for own

funds and eligible liabilities

The Group is required to meet the higher

of: (i) two times the sum of 8% Pillar 1 and

4.6% Pillar 2A equating to 25.2% of RWAs;

and (ii) 6.75% of leverage exposures. In

addition, the higher of regulatory capital

and leverage buffers apply. CET1 capital

cannot be counted towards both MREL

and the buffers, meaning that the buffers,

including the above mentioned

confidential institution-specific PRA buffer,

will effectively be applied above MREL

requirements.

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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Capital resources

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Capital ratios1, 2 |  |  |
| As at 31 December | 2023 | 2022 |
| CET1 | 13.8% | 13.9% |
| Tier 1 (T1) | 17.7% | 17.9% |
| Total regulatory capital | 20.1% | 20.8% |
| MREL ratio as a percentage of total RWAs | 33.6% | 33.5% |
|  |  |  |
| Own funds and eligible liabilities (audited) |  |  |
|  | 2023 | 2022 |
| As at 31 December | £m | £m |
| Total equity excluding non-controlling interests per the balance sheet | 71,204 | 68,292 |
| Less: other equity instruments (recognised as AT1 capital) | (13,259) | (13,284) |
| Adjustment to retained earnings for foreseeable ordinary share dividends | (795) | (787) |
| Adjustment to retained earnings for foreseeable other equity coupons | (43) | (37) |
|  |  |  |
| Other regulatory adjustments and deductions |  |  |
| Additional value adjustments (PVA) | (1,901) | (1,726) |
| Goodwill and intangible assets | (7,790) | (8,224) |
| Deferred tax assets that rely on future profitability excluding temporary differences | (1,630) | (1,500) |
| Fair value reserves related to gains or losses on cash flow hedges | 3,707 | 7,237 |
| Excess of expected losses over impairment | (296) | (119) |
| Gains or losses on liabilities at fair value resulting from own credit | 136 | (620) |
| Defined benefit pension fund assets | (2,654) | (3,430) |
| Direct and indirect holdings by an institution of own CET1 instruments | (20) | (20) |
| Adjustment under IFRS 9 transitional arrangements | 288 | 700 |
| Other regulatory adjustments | 357 | 396 |
| CET1 capital | 47,304 | 46,878 |
|  |  |  |
| AT1 capital |  |  |
| Capital instruments and related share premium accounts | 13,263 | 13,284 |
| Other regulatory adjustments and deductions | (60) | (60) |
| AT1 capital | 13,203 | 13,224 |
|  |  |  |
| T1 capital | 60,507 | 60,102 |
|  |  |  |
| T2 capital |  |  |
| Capital instruments and related share premium accounts | 7,966 | 9,000 |
| Qualifying T2 capital (including minority interests) issued by subsidiaries | 569 | 1,095 |
| Credit risk adjustments (excess of impairment over expected losses) | — | 35 |
| Other regulatory adjustments and deductions | (160) | (160) |
| Total regulatory capital | 68,882 | 70,072 |
|  |  |  |
| Less : Ineligible T2 capital (including minority interests) issued by subsidiaries | (569) | (1,095) |
| Eligible liabilities | 46,995 | 43,851 |
|  |  |  |
| Total own funds and eligible liabilities3 | 115,308 | 112,828 |
|  |  |  |
| Total RWAs (Unaudited) | 342,717 | 336,518 |

Notes

1 CET1, T1 and T2 capital, and RWAs are calculated applying the transitional arrangements of the CRR as amended by CRR II. This includes IFRS 9 transitional arrangements and the

grandfathering of CRR II non-compliant capital instruments.

2 The fully loaded CET1 ratio, as is relevant for assessing against the conversion trigger in Barclays PLC AT1 securities, was 13.7%, with £47.0bn of CET1 capital and £342.7bn of RWAs

calculated without applying the transitional arrangements of the CRR as amended by CRR II.

3 As at 31 December 2023, the Group's MREL requirement, excluding the PRA buffer, was to hold £103.0bn of own funds and eligible liabilities equating to 30.1% of RWAs. The Group

remains above its MREL regulatory requirement including the PRA buffer.

|  |  |  |  |  |  |  |  |  |  |  |
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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance |  | Risk  review | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 351 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| Movement in CET1 capital |  |
|  | 2023 |
|  | £m |
| Opening balance as at 1 January | 46,878 |
|  |  |
| Profit for the period attributable to equity holders | 5,259 |
| Own credit relating to derivative liabilities | 49 |
| Ordinary share dividends paid and foreseen | (1,218) |
| Purchased and foreseeable share repurchase | (1,250) |
| Other equity coupons paid and foreseen | (991) |
| Increase in retained regulatory capital generated from earnings | 1,849 |
|  |  |
| Net impact of share schemes | 104 |
| Fair value through other comprehensive income reserve | 194 |
| Currency translation reserve | (1,101) |
| Other reserves | (42) |
| Decrease in other qualifying reserves | (845) |
|  |  |
| Pension remeasurements within reserves | (855) |
| Defined benefit pension fund asset deduction | 776 |
| Net impact of pensions | (79) |
|  |  |
| Additional value adjustments (PVA) | (175) |
| Goodwill and intangible assets | 434 |
| Deferred tax assets that rely on future profitability excluding those arising from temporary differences | (130) |
| Excess of expected loss over impairment | (177) |
| Adjustment under IFRS 9 transitional arrangements | (412) |
| Other regulatory adjustments | (39) |
| Decrease in regulatory capital due to adjustments and deductions | (499) |
|  |  |
| Closing balance as at 31 December | 47,304 |

CET1 capital increased £0.4bn to £47.3bn (December 2022: £46.9bn).

£5.3bn of capital generated from profit, including the impacts of structural cost actions, was partially offset by distributions of £3.5bn

comprising:

• £1.25bn of share buybacks announced with FY22 and H123 results

• £1.2bn of ordinary share dividend paid and foreseen reflecting £0.4bn interim dividend paid and a £0.8bn accrual towards the FY23

dividend

• £1.0bn of equity coupons paid and foreseen

Other significant movements in the period were:

• £1.1bn decrease in the currency translation reserve driven by the strengthening of GBP against USD

• £0.4bn decrease in IFRS 9 transitional relief primarily due to the relief applied to the pre-2020 impairment charge reducing to 0% in

2023 from 25% in 2022 and the relief applied to the post-2020 impairment charge reducing to 50% in 2023 from 75% in 2022

• £0.2bn increase in PVA, which includes an increase for price uncertainty within corporate loans, including the leveraged finance loan

portfolio

• £0.4bn increase primarily driven by intangible impairment structural cost actions. The impact of this was capital neutral with the

offsetting decrease within attributable profit.

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|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Risk weighted assets

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Risk weighted assets (RWAs) by risk type and business | | | | | | | | | | | | | |
|  | Credit risk1 | |  | Counterparty credit risk | | | |  | Market risk | |  | Operational  risk | Total RWAs |
|  | Std | IRB |  | Std | IRB | Settlement  risk | CVA |  | Std | IMA |  |  |  |
| As at 31 December 2023 | £m | £m |  | £m | £m | £m | £m |  | £m | £m |  | £m | £m |
| Barclays UK | 10,472 | 50,761 |  | 178 | — | — | 94 |  | 274 | — |  | 11,715 | 73,494 |
| Corporate and Investment Bank | 40,315 | 65,499 |  | 18,775 | 22,033 | 159 | 3,260 |  | 14,625 | 25,222 |  | 26,887 | 216,775 |
| Consumer, Cards and Payments | 28,218 | 5,515 |  | 182 | 55 | — | 38 |  | 2 | 638 |  | 7,631 | 42,279 |
| Barclays International | 68,533 | 71,014 |  | 18,957 | 22,088 | 159 | 3,298 |  | 14,627 | 25,860 |  | 34,518 | 259,054 |
| Head Office | 3,881 | 6,963 |  | — | — | — | — |  | — | — |  | (675) | 10,169 |
| Barclays Group | 82,886 | 128,738 |  | 19,135 | 22,088 | 159 | 3,392 |  | 14,901 | 25,860 |  | 45,558 | 342,717 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Barclays UK | 6,836 | 54,752 |  | 167 | — | — | 72 |  | 233 | — |  | 11,023 | 73,083 |
| Corporate and Investment Bank | 35,738 | 75,413 |  | 16,814 | 21,449 | 80 | 3,093 |  | 13,716 | 22,497 |  | 27,064 | 215,864 |
| Consumer, Cards and Payments | 27,882 | 3,773 |  | 214 | 46 | — | 61 |  | — | 388 |  | 6,559 | 38,923 |
| Barclays International | 63,620 | 79,186 |  | 17,028 | 21,495 | 80 | 3,154 |  | 13,716 | 22,885 |  | 33,623 | 254,787 |
| Head Office | 2,636 | 6,843 |  | — | — | — | — |  | — | — |  | (831) | 8,648 |
| Barclays Group | 73,092 | 140,781 |  | 17,195 | 21,495 | 80 | 3,226 |  | 13,949 | 22,885 |  | 43,815 | 336,518 |

Note

1In Q323 credit risk RWAs of £9.8bn relating to deferred tax assets were reclassified from IRB to STD with no impact to total RWAs.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Movement analysis of risk weighted assets | | | | | |
|  | Credit risk | Counterparty  credit risk | Market risk | Operational risk | Total RWAs |
| Risk weighted assets | £m | £m | £m | £m | £m |
| As at 31 December 2022 | 213,873 | 41,996 | 36,834 | 43,815 | 336,518 |
| Book size | (1,338) | 2,122 | 3,325 | 1,743 | 5,852 |
| Acquisitions and disposals | 688 | — | — | — | 688 |
| Book quality | 1,512 | (136) | — | — | 1,376 |
| Model updates | (2,600) | — | 1,200 | — | (1,400) |
| Methodology and policy | 5,175 | 2,700 | — | — | 7,875 |
| Foreign exchange movement1 | (5,686) | (1,908) | (598) | — | (8,192) |
| Total RWA movements | (2,249) | 2,778 | 3,927 | 1,743 | 6,199 |
| As at 31 December 2023 | 211,624 | 44,774 | 40,761 | 45,558 | 342,717 |

Note

1 Foreign exchange movements does not include impact of  foreign exchange for modelled market risk or operational risk.

Overall RWAs increased £6.2bn to £342.7bn (December 2022: £336.5bn).

Credit risk RWAs decreased £2.2bn:

• A £1.3bn decrease in book size within CIB and mortgages within Barclays UK, partially offset by higher credit card balances within

CC&P

• A £1.5bn increase in book quality RWAs primarily driven by changes in risk parameters and HPI refresh within Barclays

UK

• A £2.6bn decrease in model updates primarily driven by capital LGD model update for the mortgage portfolio to reflect the significant

decrease in repossession volume during and post the COVID pandemic

• A £5.2bn increase in methodology and policy primarily driven by the recalibration of the post model adjustment (PMA) introduced to

address the IRB roadmap changes and a change in treatment of non-credit obligation exposures

• A £5.7bn decrease as a result of foreign exchange movements primarily due to the strengthening of GBP against USD

Counterparty Credit risk RWAs increased £2.8bn:

• A £2.1bn increase in book size primarily due to increased trading activity within CIB

• A £2.7bn increase in methodology and policy due to a recalibration of the PMA introduced to address the IRB roadmap changes and a

change in treatment of certain securities financing transactions collateral

• A £1.9bn decrease as a result of foreign exchange movements primarily due to the strengthening of GBP against USD

Market risk RWAs increased £3.9bn:

• A £3.3bn increase in book size primarily due to increased trading activity within CIB

• A £1.2bn increase in model updates to capture incremental risk arising from Stressed Value at Risk (SVaR), measured on a 10-day

basis

Operational risk RWAs increase £1.7bn:

• A £1.7bn increase in book size primarily driven by the inclusion of higher 2023 CC&P and Barclays UK income compared to 2020

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|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Leverage ratios and exposures

The Group is required to disclose a UK leverage ratio based on capital and exposure on the last day of the quarter. The Group is also

required to disclose an average UK leverage ratio which is based on capital on the last day of each month in the quarter and an exposure

measure for each day in the quarter.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Leverage ratios1,2 |  |  |
|  | 2023 | 2022 |
| As at 31 December | £m | £m |
| UK leverage ratio3 | 5.2% | 5.3% |
| T1 capital | 60,507 | 60,102 |
| UK leverage exposure | 1,168,275 | 1,129,973 |
| Average UK leverage ratio | 4.8% | 4.8% |
| Average T1 capital | 60,343 | 60,865 |
| Average UK leverage exposure | 1,266,880 | 1,280,972 |

Notes

1 Capital and leverage measures are calculated applying the transitional arrangements of the CRR as amended by CRR II.

2  Fully loaded UK leverage ratio was 5.2%, with £60.2bn of T1 capital and £1,168.0bn of leverage exposure. Fully loaded average UK leverage ratio was 4.7% with £60.0bn of T1 capital and

£1,266.6bn of leverage exposure. Fully loaded UK leverage ratios are calculated without applying the transitional arrangements of the CRR as amended by CRR II.

3 Although the leverage ratio is expressed in terms of T1 capital, the leverage ratio buffers and 75% of the minimum requirement must be covered solely with CET1 capital. The CET1

capital held against the 0.53% G-SII ALRB was £6.1bn and against the 0.3% CCLB was £3.5bn

The UK leverage ratio decreased to 5.2% (December 2022: 5.3%) primarily due to a £38.3bn increase in leverage exposure to

£1,168.3bn, largely driven by an increase in trading portfolio assets within Global Markets.

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|  |  |  |  |  |  |  |  |  |  |  |
| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Foreign exchange risk (audited)

The Group is exposed to two sources of foreign exchange risk.

a) Transactional foreign currency exposure

Transactional foreign currency exposures represent exposure on banking assets and liabilities, denominated in currencies other than

the functional currency of the transacting entity.

The Group’s risk management policies are designed to prevent the holding of significant open positions in foreign currencies outside

the trading portfolio managed by Barclays International which is monitored through VaR.

Banking book transactional foreign exchange risk outside of Barclays International is monitored on a daily basis by the market risk

function and minimised by the businesses.

b) Translational foreign exchange exposure

The Group’s investments in overseas subsidiaries and branches create capital resources denominated in foreign currencies, principally

USD and EUR. Changes in the GBP value of the net investments due to foreign currency movements are captured in the currency

translation reserve, resulting in a movement in CET1 capital.

The Group’s strategy is to minimise the volatility of the capital ratios caused by foreign exchange movements, by matching the CET1

capital movements to the revaluation of the Group’s foreign currency RWA exposures.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Functional currency of operations (audited) | | | | | | |
|  | Foreign currency  net investments | Borrowings which  hedge the net  investments | Derivatives which  hedge the net  investments | Structural  currency  exposures pre-  economic hedges | Economic hedges | Remaining  structural currency  exposures |
|  | £m | £m | £m | £m | £m | £m |
| 31 December 2023 |  |  |  |  |  |  |
| USD | 26,524 | (7,308) | (2,179) | 17,037 | (7,326) | 9,711 |
| EUR | 9,868 | (5,603) | — | 4,265 | (276) | 3,989 |
| JPY | 646 | (174) | — | 472 | — | 472 |
| Other currencies | 3,329 | (72) | (1,565) | 1,692 | (505) | 1,187 |
| Total | 40,367 | (13,157) | (3,744) | 23,466 | (8,107) | 15,359 |
|  |  |  |  |  |  |  |
| 31 December 2022 |  |  |  |  |  |  |
| USD | 27,441 | (7,363) | (2,086) | 17,992 | (8,688) | 9,304 |
| EUR | 9,776 | (5,461) | (3) | 4,312 | (283) | 4,029 |
| JPY | 689 | — | (197) | 492 | — | 492 |
| Other currencies | 3,330 | — | (1,676) | 1,654 | (279) | 1,375 |
| Total | 41,236 | (12,824) | (3,962) | 24,450 | (9,250) | 15,200 |

Economic hedges relate to exposures arising on foreign currency denominated preference share and AT1 instruments. These are

accounted for at historical cost under IFRS and do not qualify as hedges for accounting purposes. The gain or loss arising from changes

in the GBP value of these instruments is recognised on redemption in retained earnings.

During 2023, total structural currency exposure net of hedging instruments increased by £0.2bn to £15.4bn (2022 : £15.2bn). Foreign

currency net investments decreased by £0.8bn to £40.4bn (2022: £41.2bn) driven predominantly by a £0.9bn decrease in USD, offset

by £0.1bn increase in EUR. The hedges (excluding economic hedges) associated with these investments increased by £0.1bn to

£16.9bn (2022: £16.8bn).

Pension risk review

The UK Retirement Fund (UKRF) represents approximately  96%  (2022 :  96% ) of the Group’s total retirement benefit obligations globally.

As such this risk review section focuses exclusively on the UKRF. The UKRF is closed to new entrants and there is no new final salary

benefit being accrued. Existing active members accrue a combination of a cash balance benefit and a defined contribution element.

Pension risk arises as the market value of the pension fund assets may decline, investment returns may reduce or the estimated value

of the pension liabilities may increase.

Refer to the Management of pension risk section in the Barclays PLC Pillar 3 Report 2023 (unaudited) for more information on how

pension risk is managed.

Assets

The Trustee Board of the UKRF defines its overall long-term investment strategy with investments across a broad range of asset

classes. This results in a diversified mix of return seeking assets as well as liability matching assets to better match future pension

obligations. The two largest  risks within the asset portfolio are credit spread and growth assets. The split of scheme assets is shown

within Note 32 to the financial statements. The fair value of the UKRF assets was £24.2b n as at 31 December 2023 ( 2022: £24.7bn).

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| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Liabilities

The UKRF retirement benefit obligations are a series of future cash flows with relatively long duration. On an IAS 19 basis these cash

flows are sensitive to changes in the expected long-term price inflation rate (RPI) and the discount rate (GBP AA corporate bond yield):

• An increase in long-term expected inflation corresponds to an increase in liabilities;

• A decrease in the discount rate corresponds to an increase in liabilities.

Pension risk is generated through the Group’s defined benefit schemes and this risk is set to reduce over time as the main defined

benefit scheme is closed to new entrants. The chart below outlines the shape of the UKRF’s liability cash flow profile as at 31 December

2023 that takes account of the future inflation indexing of payments to beneficiaries. The majority of the cash flows (approximately

96%) fall between 0 and 40 years, peaking between 11 and 20 years and reducing thereafter. The shape may vary depending on

changes to inflation and longevity expectations and any members who elect to transfer out. Transfers out will bring forward the liability

cash flows.

For more detail on the UKRF’s financial and demographic assumptions, see Note 32 to the financial statements.

|  |
| --- |
|  |
| Proportion of liability cash flows  (%) |

![2480]()

|  |  |  |
| --- | --- | --- |
|  |  |  |
| n | 0-10 years | 30.7 |
| n | 11-20 years | 32.6 |
| n | 21-30 years | 22.2 |
| n | 31-40 years | 11 |
| n | 41-50 years | 3.3 |
| n | 51+ years | 0.3 |
|  |  |  |
|  |  |  |
|  |  |  |

|  |
| --- |
|  |
| Net IAS 19 position  (£bn) |

|  |
| --- |
|  |
| 6 |
| 5 |
| 4 |
| 3 |
| 2 |
| 1 |
| 0 |
|  |

![2488]()

The graph above shows the evolution of the UKRF’s net IAS 19 position over the last two years. During 2023 the decrease in the UKRF

surplus was driven by assets underperforming the discount rate and lower corporate bond yields.

Refer to Note 32 to the financial statements  for the sensitivity of the UKRF to changes in key assumptions.

Risk measurement

In line with Barclays’ risk management framework the assets and liabilities of the UKRF are modelled within a VaR framework to show the

volatility of the pension position at a total portfolio level. This enables the risks, diversification and liability matching characteristics of the

UKRF obligations and investments to be adequately captured. VaR is measured and monitored on a monthly basis. Risks are reviewed

and reported regularly at  the Pensions Executive Board. The VaR model takes into account the valuation of the liabilities on an IAS 19

basis (see Note 32 to the financial statements). The Trustee receives quarterly VaR measures on a funding basis.

The pension liability is also sensitive to post-retirement mortality assumptions which are reviewed regularly (See Note 32 to the

financial statements). To mitigate part of this risk the UKRF has entered into longevity reinsurance contracts approximately three

quarters of current pensioner liabilities.

In addition, the impact of pension risk to the Group is taken into account as part of the stress testing process. Stress testing is

performed internally on at least an annual basis. The UKRF exposure is also included as part of regulatory stress tests.

Barclays defined benefit pension schemes affects capital in two ways:

• An IAS 19 deficit is treated as a liability on the Group’s balance sheet. Movement in a deficit due to remeasurements, including

actuarial losses, are recognised immediately through Other Comprehensive Income and as such reduces shareholders’ equity and

CET1 capital. An IAS 19 surplus is treated as an asset on the balance sheet and increases shareholders’ equity; however, it is

deducted for the purposes of determining CET1 capital.

• In the Group’s statutory balance sheet an IAS 19 surplus or deficit is partially offset by a deferred tax liability or asset respectively.

These may or may not be recognised for calculating CET1 capital depending on the overall deferred tax position of the Group at the

particular time.

Pension risk is taken into account in the Pillar 2A capital assessment undertaken by the PRA at least annually. The Pillar 2A requirement

forms part of the overall capital requirement for the Group.

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| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

Interest rate risk in the banking

book

All disclosures in this section are unaudited

unless otherwise stated.

Overview

The treasury and capital risk framework

covers interest rate sensitive exposures

held in the banking book, mostly relating to

accrual accounted and FVOCI

instruments. The potential volatility of net

interest income is measured by an Annual

Earnings at Risk (AEaR) metric which is

monitored regularly and reported to senior

management and the Barclays PLC Board

Risk Committee as part of the limit

monitoring framework.

For further detail on the interest rate risk in

the banking book governance and

framework refer to page 177  of the

Barclays PLC Pillar  3 Report 2023

(unaudited).

Key metrics

#### AEaR

-£57m

AEaR across the Group from a -25b ps

Shock to forward interest rate curves.

Summary of performance in the

period

NII sensitivity to interest rate shocks has

decreased year on year due to changes in

the customer banking book's composition.

NII sensitivity asymmetry is due to the

timing impact of customer rate changes

following a rate shock and is also impacted

by changes in  balance sheet composition.

Net interest income sensitivity

The table below shows a sensitivity

analysis on pre-tax net interest income for

non-traded financial assets and liabilities,

including the effect of any hedging. This

analysis is not a forward guidance on NII

and is intended as a quantification of risk

exposure utilising the Net Interest Income

(NII) metric as described on page 177 of

the Barclays PLC Pillar 3 Report 2023

(unaudited), which includes

documentation of the main model

assumptions.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Net interest income sensitivity (AEaR) by business unit (audited) |  |  |  |  |
|  | Barclays UK | Barclays  International | Head Office | Total |
| As at 31 December | £m | £m | £m | £m |
| 2023 |  |  |  |  |
| +25bps | 45 | (8) | (16) | 21 |
| -25bps | (78) | 5 | 16 | (57) |
|  |  |  |  |  |
| 2022 |  |  |  |  |
| +25bps | 15 | 25 | (15) | 25 |
| -25bps | (59) | (29) | 15 | (73) |

Note

The Group’s customer banking book hedging activity is risk reducing from an NII sensitivity perspective. The hedges  in place remove interest rate risk and smooth income over the medium

term. The NII sensitivity for the Group at 31 December 2023 without hedging in place for +/-25bp rate shocks would be £184m/£(220)m respectively.

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| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Net interest income sensitivity (AEaR) by currency (audited) |  |  |  |  |
|  | 2023 | | 2022 | |
|  | +25 basis points | -25 basis points | +25 basis points | -25 basis points |
| As at 31 December | £m | £m | £m | £m |
| GBP | (1) | (33) | (6) | (40) |
| USD | 17 | (18) | 43 | (45) |
| EUR | 20 | (21) | 3 | (4) |
| Other currencies | (15) | 15 | (15) | 16 |
| Total | 21 | (57) | 25 | (73) |

Analysis of equity sensitivity

Equity sensitivity measures the overall impact of a +/-25bps movement in interest rates on retained earnings, FVOCI, cash flow hedge

reserves and pensions. For non-NII items a DV01 metric is used, which is an indicator of the shift in value for a 1bp movement in the

yield curve.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Analysis of equity sensitivity (audited) |  | |  | |
|  | 2023 | | 2022 | |
|  | +25 basis  points | -25 basis  points | +25 basis  points | -25 basis  points |
| As at 31 December | £m | £m | £m | £m |
| Net interest income | 21 | (57) | 25 | (73) |
| Taxation effects on the above | (5) | 13 | (5) | 15 |
| Effect on profit for the year | 16 | (44) | 20 | (58) |
| As percentage of net profit after tax | 0.3% | (0.8%) | 0.3% | (1.0%) |
|  |  |  |  |  |
| Effect on profit for the year (per above) | 16 | (44) | 20 | (58) |
| Fair value through other comprehensive income reserve | (246) | 254 | (291) | 302 |
| Cash flow hedge reserve | (744) | 744 | (774) | 774 |
| Taxation effects on the above | 228 | (230) | 288 | (291) |
| Effect on equity | (746) | 724 | (757) | 727 |
| As percentage of equity | (1.0%) | 1.0% | (1.1%) | 1.0% |

Movements in the FVOCI reserve impact CET1 capital. However, movements in the cash flow hedge reserve and pensions

remeasurement reserve recognised in FVOCI do not affect CET1 capital.

Volatility of the FVOCI portfolio in the liquidity pool

Changes in value of FVOCI exposures flow directly through capital via the FVOCI reserve. The volatility of the value of the FVOCI

investments in the liquidity pool is captured and managed through a value measure rather than an earning measure, i.e. non-traded

market risk VaR.

Although the underlying methodology to calculate the non-traded VaR is identical to the one used in traded management VaR, the two

measures are not directly comparable. The non-traded VaR represents the volatility to capital driven by the FVOCI exposures. These

exposures are in the banking book and do not meet the criteria for trading book treatment.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Analysis of volatility of the FVOCI portfolio in the liquidity pool | | | | | | |
|  | 2023 | | | 2022 | | |
|  | Average | High | Low | Average | High | Low |
| For the year ended 31 December | £m | £m | £m | £m | £m | £m |
| Non-traded market value at risk (daily, 95%) | 76 | 90 | 61 | 48 | 62 | 35 |

Daily Value at Risk has trended upwards in H1 2023 due to increase in time series volatility and addition in interest rate risk positioning.

Daily Value at Risk reduced towards the end of H2 2023 as time series volatility subsided.

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| Risk performance - Treasury and Capital risk (continued) | | | | | | | | | | |

#### Operational risk

All disclosures in this section are unaudited unless otherwise stated.

Overview

Operational risks are inherent in the

Group’s business activities and it is not

cost effective or possible to attempt to

eliminate all operational risks. The

Operational Risk Framework is therefore

focused on identifying operational risks,

assessing them and managing them within

the Group’s approved risk appetite.

The Operational Risk principal risk

comprises the following risks: Change

Delivery Management Risk; Data

Management Risk; Financial Reporting

Risk; Fraud Risk; Information Security Risk;

Operational Recovery Planning Risk;

Payments Process Risk; People Risk;

Physical Security Risk; Premises Risk; Risk

Reporting; Supplier Risk; Tax Risk;

Technology Risk and Transaction

Operations Risk. The operational risk

profile is also informed by a number of

connected risks: Cybersecurity, Data, and

Resilience. These themes represent

threats to the Group that extend across

multiple risk types, and therefore require

an integrated risk management approach.

For definitions of these risks refer to pages

181 to 183 of the Barclays PLC Pillar 3

Report 2023. To provide complete

coverage of the potential adverse impacts

on the Group arising from operational risk,

the operational risk taxonomy extends

beyond the risks listed above to cover

operational risks associated with other

principal risks too.

This section provides an analysis of the

Group’s operational risk profile, including

events above the Group’s reportable

threshold, which have had a financial

impact in  2023. The Group’s operational

risk profile is informed by bottom-up risk

assessments undertaken by each business

unit and top-down qualitative review for

each risk type. Fraud, Transaction

Operations, Information Security and

Technology continue to be highlighted as

key operational risk exposures.

For information on compliance risk events,

see the compliance risk section.

Key metrics

83%

of the Group’s net reportable operational

risk events had a loss value of £50,000 or

less

85%

of events by number are due to External

Fraud

56%

of losses are from events aligned to

External Fraud

40%

of losses are from events aligned to

Execution, Delivery and Process

Management

Summary of performance in the

period

During 2023, total operational risk losses 1

reduced to £141m (2022: £161m) while

the number of recorded events for 2023

(2,914) remained broadly in line with the

level for 2022 (2,964). The total

operational risk losses for the year were

mainly driven by events falling within the

Execution, Delivery & Process

Management and External Fraud

categories, which tend to be high volume

but low impact events.

Operational risk profile

Within operational risk, there are a large

number of smaller value risk events. In

2023 , 83% (2022: 84%) of the Group’s

reportable operational risk events by

volume had a value of less than £50,000

each. Cumulatively, events under this

£50,000 threshold accounted for only 33%

(2022: 32%) of the Group’s total net

operational risk losses. A small proportion

of operational risk events have a material

impact on the financial results of the

Group.

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| Risk performance - Operational risk | | | | | | | | | | |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | The analysis below presents the Group’s operational risk events  by Basel event category: | | |  |
|  | Operational risk events by BASEL  event category 1 | | |  |
|  |  |  |  |  |
|  | % of total risk events by count |  | % of total risk events by value |  |
|  | Internal fraud |  | Internal fraud |  |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![473]()

|  |
| --- |
|  |
| External fraud |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![478]()

|  |
| --- |
|  |
| Execution delivery  and process management |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![483]()

|  |
| --- |
|  |
| Employment practices  and workplace safety |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![488]()

|  |
| --- |
|  |
| Damage to physical assets |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![493]()

|  |
| --- |
|  |
| Clients, products  and business practices |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![498]()

|  |
| --- |
|  |
| Business disruption  and system failures |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![503]()

|  |  |
| --- | --- |
|  |  |
|  | Note  1 The data disclosed includes operational risk losses for reportable events impacting the Barclays Group business  areas, having impact of > £10,000 and excludes events that are compliance or legal risk, aggregate and boundary  events. A boundary event is an operational risk event that results in a credit risk impact. Due to the nature of risk  events that keep evolving, prior year losses are updated. |

|  |
| --- |
|  |
|  |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![525]()

|  |
| --- |
|  |
| External fraud |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![530]()

|  |
| --- |
|  |
| Execution delivery  and process management |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![535]()

|  |
| --- |
|  |
| Employment practices  and workplace safety |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![540]()

|  |
| --- |
|  |
| Damage to physical assets |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![545]()

|  |
| --- |
|  |
| Clients, products  and business practices |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![550]()

|  |
| --- |
|  |
| Business disruption and system  failures |

|  |
| --- |
|  |
| 2023 |
| 2022 |

![555]()

• External Fraud remains the category with

the highest frequency of events at 85% of

total events in 2023 (2022 : 86%). Impacts

from events arising from External Fraud

increased slightly in 2023 to £79m (2022:

£76m) and accounted for 56% of total

2023 losses (2022: 47%). In this category,

high volume, low value events are driven

by transactional fraud often related to

debit and credit card usage. Note: total

External Fraud losses in 2023 including

those from events with impact <£10,000

amounted to £183m (2022: £190m).

• Execution, Delivery and Process

Management impacts decreased to £56m

(2022: £83m) and accounted for 40%

(2022: 52%) of total operational risk

losses. The events in this category are

typical of the banking industry as a whole

where high volumes of transactions are

processed on a daily basis, mapping mainly

to Barclays Transaction Operations risk

type. The overall frequency of events in

this category remained stable at 14% of

total events by volume (2022: 14%).

Investment continues to be made in

improving the control environment across

the Group. Specific areas of focus include

new and enhanced fraud prevention

systems and tools to combat the

increasing level of fraud attempts being

made whilst minimising disruption to

genuine transactions. Fraud remains an

industry wide threat and the Group

continues to work closely with external

partners on various prevention initiatives.

Additionally, the Group continues to invest

in its processing infrastructure to manage

the risk of processing errors as well as

ensuring scalability of operations.

Operational Resilience remains a key area

of focus for the Group, having been

reinforced in recent years due to potential

operational disruption from the COVID-19

pandemic.  The Group continues to

strengthen its resilience approach across

its most important business services to

improve recoverability and assurance

thereof by reviewing  scenarios based on

current global climates.

Operational risk associated with

cybersecurity remains a top focus for the

Group. The sophistication of threat actors

continues to grow as noted by multiple

external risk events observed throughout

the year. Ransomware attacks across the

global Barclays supplier base were

observed and we worked closely with the

affected suppliers to manage potential

impacts to the Group and its clients and

customers. The Group’s cybersecurity

events were managed within its risk

tolerances, and cybersecurity incidents did

not materially impact the Group's business

strategy, results of operations, or financial

condition. For further information, refer to the

[operational risk management section](#i4be61753b7f243b19551b0bfbf3a2a0d_679).

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| Risk performance - Operational risk (continued) | | | | | | | | | | |

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| 0.4 |
| 0.4 |

#### Model risk, Compliance risk, Reputation risk and Legal risk

All disclosures in this section are unaudited unless otherwise stated.

Model risk

Barclays is committed to continuously

improving model risk management and

made a number of enhancements in 2023,

including:

• Continued improvements to the

transparency and oversight of model

risk through further upgrades to model

risk governance structure.

• Continued enhancements to model risk

policy and standards to ensure

comprehensiveness, consistency and

cohesiveness of the model risk

framework.

• Continued focus on improving the

model risk control framework .

• Enhanced the Group Model Risk

Appetite Statement, incorporating

model quality and uncertainty around a

model’s output.

• Continued strengthening of validation

practices through expansion of model-

level validation procedures, use of an

on-going validation training program

and further embedment of a validation

quality assurance process.

• Executed on hiring strategy by

expanding the model risk team to

support a wider range of model

validation demand, newly emerging

model risks, and an enhanced focus on

regulatory models .

• Progressed model inception validation

by bringing more models into

compliance with the model risk

management framework, including our

first algorithmic trading models

Compliance risk

Barclays is committed to continuing to

drive the right culture throughout all levels

of the organisation. The Group will

continue to enhance effective

management of Compliance risk and

appropriately consider the relevant tools,

governance and management information

in decision-making processes. Focus on

management of Compliance risk is

ongoing and, alongside other relevant

business and control management

information, the Trading Entity Conduct

Risk Dashboard is a key component of this.

The Group continues to review the role

and impact of Compliance risk events and

issues in remuneration decisions at both

the individual and business level.

In 2023, the Group maintained focus on

new and heightened inherent Compliance

risks, including those relating to the cost of

living crisis, the evolving threat landscape

as related to financial crime, and

challenges in ensuring customer and client

data is handled appropriately. These risks

continue to be monitored on an ongoing

basis.

A key area of focus has been the

implementation and embedment of the

FCA’s new Consumer Duty, with rules for

open products and services taking effect

at the end July 2023.

Businesses have continued to assess the

potential customer, client and market

impacts of strategic change. As part of the

2023 medium-term planning process,

material Compliance risks associated with

strategic and financial plans were

assessed.

Throughout 2023, Compliance risks were

raised by each business area for

consideration by relevant Board level

committees. These committees reviewed

the risks raised and whether

management’s proposed actions were

appropriate to mitigate the risks

effectively.

During 2023, laws, rules and regulation risk

(LRR risk) was created as a new risk under

the Compliance Principal Risk. LRR is

intended to mitigate the risk of failing to

identify applicable LRRs, and ensure

appropriate steps are in place to monitor

and oversee LRRs. Work is underway to

implement processes to support the

management and oversight of LRR Risk.

The Group continued to incur costs in

relation to litigation and conduct matters,

refer to Note 25 Legal, competition and

regulatory matters and  Note 23 Provisions

for further details. Costs include customer

redress and remediation, as well as fines

and settlements. Resolution of these

matters remains a necessary and

important part of delivering the Group’s

strategy and an ongoing commitment to

improve oversight of culture and conduct.

Trading Entity Conduct Risk Dashboards,

setting out key indicators in relation to

conduct and financial crime risk, are

provided to the respective Board Risk

Committees and senior management.

These continue to be evolved and

enhanced to allow effective oversight and

decision-making. Work is ongoing to

enhance the Compliance Risk Control

Environment in a timely and effective

manner to ensure the Group operates

within Risk Appetite. The tolerance

adherence is assessed by the business

areas through key indicators  and reported

to the relevant Trading Entity Board

Committees as part of the Conduct Risk

Dashboard governance process.

The Group remains focused on the

continuous improvements being made to

manage risk effectively with an emphasis

on enhancing governance and

management information to identify risk at

earlier stages.

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| Risk performance - Model risk, Compliance risk, Reputation risk  and Legal risk | | | | | | | | | | |

Reputation  risk

Barclays is committed to identifying

reputation risks and issues as early as

possible and managing them appropriately.

At a Group level throughout 2023,

reputation risks and issues were overseen

by the Board which reviews the processes

and policies which Barclays identifies and

manages reputation risk. Within the

Barclays Bank UK Group and the Barclays

Bank Group reputation risks and issues

were overseen by the respective risk and

Board risk committees. The top live and

emerging reputation risks and issues within

the Barclays Bank UK Group and the

Barclays Bank Group are included within an

over-arching quarterly report at the

respective Board level.

The Board reviewed risks escalated by the

businesses and considered whether

management’s proposed actions, for

example attaching conditions to proposed

client transactions or increased

engagement with impacted stakeholders,

were appropriate to mitigate the risks

effectively. The Board also received regular

updates with regard to key reputation risks

and issues, including: Barclays' response to

global conflicts; Barclays’ association with

sensitive sectors; access to banking;

lending practices and the resilience of key

Barclays systems and processes.

The Group continued to incur costs in

relation to litigation and conduct matters,

refer to Note 25 Legal, competition and

regulatory matters and Note 23 Provisions

for further details. Costs include customer

redress and remediation, as well as fines

and settlements. Resolution of these

matters remains an ongoing commitment

to improve oversight of culture and

conduct and management of reputation

risks.

As part of Barclays 2023 Medium Term

Planning process, material reputation risks

associated with strategic and financial

plans were also assessed.

Legal risk

The Group remains committed to

continuous improvements in managing

legal risk effectively. During 2023, the

Group-wide legal risk management

framework was updated to complement

and accommodate the introduction of

changes to the compliance risk

management framework, which includes

the responsibility of the Legal Function to

proactively identify, communicate and

provide legal advice on applicable laws,

rules and regulations.

Other improvements during 2023 included

a review and update of the supporting legal

risk policies, standards and mandatory

training, reinforced by ongoing

engagement with and education of the

Group’s businesses and functions by Legal

Function colleagues. Legal risk tolerances

and legal risk appetite have also been

reviewed.

Tolerances adherence is assessed

through key indicators, which are also used

to evaluate the legal risk profile and are

reviewed, at least annually, through the

relevant risk and control committees.

Mandatory controls to manage legal risks

are set out in the legal risk standards and

are subject to ongoing monitoring. The

implementation of changes to the

compliance risk management framework

referred to above (and described in more

detail on page [361](#i4be61753b7f243b19551b0bfbf3a2a0d_790)) also mitigate legal risk.

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| Risk performance - Model risk, Compliance risk, Reputation risk  and Legal risk (continued) | | | | | | | | | | |

Supervision of the Group

The Group’s operations, including its

overseas branches, subsidiaries and

associates, are subject to a large number

of rules and regulations applicable to the

conduct of banking and financial services

business in each of the jurisdictions in

which the Group operates. These apply to

business operations, impact financial

returns and include capital, leverage and

liquidity requirements, authorisation,

registration and reporting requirements,

restrictions on certain activities, and

conduct of business regulations, amongst

other applicable regulatory requirements.

Regulatory developments in one or more

jurisdictions may impact the Group

globally. We focus particularly on UK, US

and EU regulation in this Report due to the

location of the Group’s principal areas of

business. Regulations elsewhere may also

have a significant impact on the Group due

to the location of its branches, subsidiaries

and, in some cases, clients. For more

information on the risks related to the

supervision and regulation of the Group,

including regulatory change, see the

material existing and emerging risk entitled

‘Regulatory Change agenda and impact on

Business Model’ in the Material existing and

emerging risks section.

Supervision in the UK

In the UK, day-to-day regulation and

supervision of the Group is divided

between the Prudential Regulation

Authority (PRA) (a division of the Bank of

England (BoE)) and the Financial Conduct

Authority (FCA). In addition, the Financial

Policy Committee (FPC) of the BoE has

influence on the prudential requirements

that may be imposed on the banking

system through its powers of direction and

recommendation. Certain members of the

Group are also subject to regulatory

initiatives undertaken by the UK Payment

Systems Regulator (PSR), as a participant

in payment systems regulated by the PSR.

Barclays Bank PLC and Barclays Bank UK

PLC are both authorised with permission

to accept deposits, amongst other things,

and are subject to prudential supervision

by the PRA and to conduct regulation and

supervision by the FCA. The Barclays Bank

Group is subject to prudential supervision

on a solo-consolidated basis and the

Barclays Bank UK Group is subject to

prudential supervision on a group sub-

consolidated basis and on an individual

basis. The Group as a whole is also subject

to prudential supervision by the PRA on a

group consolidated basis. Barclays PLC

has been approved by the PRA as a

financial holding company.

Barclays Capital Securities Limited (BCSL)

is authorised and subject to prudential

supervision by the PRA as a PRA-

designated investment firm and subject to

conduct regulation and supervision by the

FCA. Barclays Execution Services Limited

is an appointed representative of Barclays

Bank PLC, Barclays Bank UK PLC and

Clydesdale Financial Services Limited.

The PRA’s supervision of the Group is

conducted through a variety of regulatory

tools, including the collection of

information by way of prudential returns or

cross-firm reviews, reports obtained from

skilled persons, information gathering,

regular supervisory visits and regular

meetings with the Group’s management

and directors to discuss issues such as

strategy, governance, financial resilience,

operational resilience, risk management,

and recovery and resolution.

Further, the BoE, as the UK resolution

authority, informs prudential requirements

and sets requirements for the Group

relating to resolution preparedness.

The FCA’s supervision of the UK firms in

the Group is carried out through a

combination of proactive engagement

meetings, regular supervisory visits,

information gathering and regular

meetings with management and directors

to discuss issues such as customer

strategy, fair treatment of customers, and

financial crime controls, as well as cross-

sectoral reviews which analyse the

different areas of the market and the risks

that may lie ahead.

The FCA and the PRA also apply the Senior

Managers and Certification Regime (the

SMCR) which imposes a regulatory

approval, individual accountability and

fitness and propriety framework in respect

of senior individuals within relevant firms.

FCA supervision has focused on conduct

risk and customer/client outcomes

through implementation of the Consumer

Duty (including product design and fair

value), fraud and anti-money laundering

controls, market operations, access to

cash, fair treatment of vulnerable

customers and payment account access

and closures.

PRA supervision has focused on financial

and operational resilience, controls, credit

risk management, systems and controls,

climate risk and resolvability, where

resolvability is reviewed in conjunction with

the Resolution Directorate (a division of

the BoE).

Both the PRA and the FCA apply standards

that generally either anticipate or go

beyond requirements established by global

or EU standards, whether in relation to

capital, leverage and liquidity, resolvability

and resolution or matters of conduct. The

UK is in the process of reviewing and

revising the EU legislation that was

onshored into English law following the

UK's departure from the EU. This process

is ongoing, but based on current

indications, potential areas of divergence

in approach between the UK and the EU in

existing areas of regulation appear

moderate and are not expected to result in

materially different standards of

regulation. Divergence might become

more marked in new areas of regulation,

such as ESG and Digital. The Financial

Services and Markets Act 2023 (FSMA

2023) established a framework for the

revocation of retained EU law relating to

financial services, with HM Treasury

intending to repeal retained EU legislative

provisions subject to the transfer of its

provisions to the UK regulators’ rules

where appropriate. The Government is not

expected to revoke retained EU law

relating to financial services unless the

FCA and/or PRA have drafted and

consulted on rules in the relevant areas,

where it is appropriate that the provisions

are replaced.  However, HM Treasury may

specify parts of retained EU law where the

regulators are exempt from such

requirements, for example where they are

restating retained EU law revoked through

FSMA 2023 in their rulebooks without

material changes or where they are

replacing revoked retained EU law with

material changes but the only material

effect is to reduce a regulatory burden.

Where changes also have other material

effects, which may include impacts on the

regulators’ objectives, for example, the

Government has indicated that it is

appropriate to require the regulators to

consult. The medium term outlook for the

costs and impact of operating under the

post-Brexit UK regime remains unclear as

the regulatory landscape continues to

develop. There is potential for an increase

in regulatory implementation costs in the

near term to adapt systems and controls.

Supervision in the EU

The Group’s operations in Europe are

authorised and regulated by a combination

of its home regulators and host regulators

in the European countries where the

Group operates.

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| Supervision and regulation | | | | | | | | | | |

Barclays Bank Ireland PLC is licensed as a

credit institution by the Central Bank of

Ireland (CBI) and is designated as a

significant institution falling under direct

supervision on a solo basis by the

European Central Bank (ECB) for

prudential purposes. Barclays Bank Ireland

PLC’s EU branches are supervised by the

ECB and are also subject to direct

supervision for local conduct purposes by

national supervisory authorities in the EU

jurisdictions where they are established.

Barclays Bank Ireland PLC is subject to the

requirements set by the Single Resolution

Board (SRB) as the resolution authority of

Barclays Bank Ireland PLC.  Barclays Bank

Ireland PLC is also subject to supervision

by the CBI as home state or competent

authority under various EU financial

services directives and regulations.

The Group provides the majority of its

cross-border banking and investment

services to EEA clients via Barclays Bank

Ireland PLC. Additionally, Barclays Bank

PLC and BCSL are authorised in certain

EEA Member States to enable them to

continue to conduct a limited range of

activities without a presence, including

accessing EEA trading venues and

interdealer trading. Barclays Bank PLC also

has a branch in Paris (to facilitate access to

Target 2), which is regulated by the ACPR.

Supervision in the US

Barclays PLC, Barclays Bank PLC and its

New York branch, and Barclays Bank PLC’s

US subsidiaries are subject to a

comprehensive regulatory framework

involving numerous statutes, rules and

regulations in the US. For example, the

Group’s US activities and operations are

subject to supervision and regulation by

the Board of Governors of the Federal

Reserve System (FRB), as well as additional

supervision, requirements and restrictions

imposed by other federal and state

regulators and self-regulatory

organisations (SROs). In some cases, US

requirements may impose restrictions on

the Group’s global activities, in addition to

its activities in the US.

Barclays PLC, Barclays Bank PLC, Barclays

US Holdings Limited (BUSHL), Barclays US

LLC (BUSL), and Barclays Group US Inc.

(BGUS) are regulated as bank holding

companies (BHCs) by the FRB.

BUSL is the Group’s ultimate US holding

company that holds substantially all of the

Group’s US subsidiaries (including Barclays

Capital Inc. (BCI) and Barclays Bank

Delaware). BUSL is subject to

requirements in respect of capital

adequacy, capital planning and stress

testing, risk management and governance,

liquidity, leverage limits, large exposure

limits, restrictions on activities and financial

regulatory reporting. Barclays Bank PLC’s

New York branch is also subject to

enhanced prudential standards relating to,

among other things, liquidity and risk

management.

Barclays PLC, Barclays Bank PLC, BUSHL

and BUSL have financial holding company

(FHC) status under the Bank Holding

Company Act of 1956. FHC status allows

these entities to engage in a variety of

financial and related activities, directly or

through subsidiaries, including

underwriting, dealing and market making in

securities. Failure to maintain FHC status

could result in increasingly stringent

penalties and, ultimately, in the closure or

cessation of certain operations in the US.

In addition to oversight by the FRB,

Barclays Bank PLC’s New York branch and

many of the Group’s subsidiaries are

regulated by additional US authorities

based on the location or activities of those

entities. The New York branch of Barclays

Bank PLC is subject to supervision and

regulation by the New York State

Department of Financial Services

(NYSDFS). Barclays Bank Delaware, a

Delaware chartered bank, is subject to

supervision and regulation by the Delaware

Office of the State Bank Commissioner,

the Federal Deposit Insurance Corporation

(FDIC), the FRB and the Consumer

Financial Protection Bureau (CFPB). The

deposits of Barclays Bank Delaware are

insured by the FDIC, up to applicable limits.

Barclays PLC, Barclays Bank PLC, BUSHL,

BUSL, and BGUS are required to act as a

source of strength for Barclays Bank

Delaware. This could, among other things,

require these entities to provide capital

support to Barclays Bank Delaware if it fails

to meet applicable regulatory capital

requirements.

The Group’s US securities broker/dealer

and investment banking operations are

conducted primarily through BCI, and are

also subject to ongoing supervision and

regulation by the Securities and Exchange

Commission (SEC), the Financial Industry

Regulatory Authority (FINRA) and other

government agencies and SROs under US

federal and state securities laws. BCI is also

registered as a Futures Commission

Merchant with the Commodity Futures

Trading Commission (CFTC), through

which the Group conducts its US futures

and options on futures business, including

client clearing operations, which are

subject to ongoing supervision and

regulation by the CFTC, the National

Futures Association and other SROs.

Under the US framework for regulating

swaps and security-based swaps

established under Title VII of the Dodd-

Frank Act, the CFTC has regulatory

authority over swaps, the SEC has

regulatory authority over security-based

swaps, and the  CFTC and SEC  jointly

regulate mixed swaps (as such terms are

defined in the relevant legislation).

Accordingly, the Group’s activities related

to US swaps and security-based swaps are

principally conducted by Barclays Bank

PLC and are subject to ongoing

supervision and regulation by the CFTC

and the SEC, respectively. Barclays Bank

PLC is provisionally registered as a swap

dealer with the CFTC and conditionally

registered as a security-based swap dealer

with the SEC. Barclays Bank PLC is also

subject to the FRB swaps rules with

respect to margin and capital

requirements. In addition, Barclays Bank

Ireland PLC is provisionally registered as a

swap dealer with the CFTC and is subject

to the FRB swaps rules with respect to

margin and capital.

Supervision in Asia Pacific

The Group’s operations in Asia Pacific are

supervised and regulated by a broad range

of national banking and financial services

regulators.

Prudential regulation

Certain Basel III standards were

implemented in EU law through the Capital

Requirements Regulation (CRR) and the

Capital Requirements Directive IV (CRD

IV), as amended by CRR II and CRD V.

These standards were retained in the UK

regulatory framework via a series of

onshoring instruments when the UK

withdrew from the European Union.

Beyond the minimum standards required

by CRR, the PRA has expected the Group,

in common with other major UK banks and

building societies, to meet a 7% Common

Equity Tier 1 (CET1) ratio at the level of the

consolidated group since 1 January 2016.

The 7% CET1 ratio is made up of a Pillar 1

minimum capital requirement of 4.5%

CET1 and a capital conservation buffer

which must be met entirely with CET1

capital.

Global systemically important banks (G-

SIBs), such as the Barclays Group, are

subject to a number of additional

prudential requirements, including the

requirement to hold additional loss-

absorbing capacity and additional capital

buffers above the level required by Basel III

standards.

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The level of the G-SIB buffer is set by the

Financial Stability Board (FSB) according to

a bank’s systemic importance and can

range from 1% to 3.5% of risk-weighted

assets (RWAs). The G-SIB buffer must be

met with CET1 capital. In November 2023,

the FSB published an update to its list of G-

SIBs, maintaining the 1.5% G-SIB buffer

that applies to the Group.

The Group is subject to a ‘combined buffer

requirement’ consisting of (i) a capital

conservation buffer of 2.5% of RWAs, and

(ii) a countercyclical capital buffer (CCyB).

The CCyB is based on rates determined by

the regulatory authorities in each

jurisdiction in which the Group maintains

exposures. In the UK, the CCyB rate is set

by the FPC and is currently 2%.

The PRA requires UK firms to hold

additional capital to cover risks which the

PRA assesses are not fully captured by the

Pillar 1 capital requirement. The PRA sets

this additional capital requirement (Pillar

2A) at least annually, derived from each

firm’s individual capital guidance. Under

current PRA rules, the Pillar 2A

requirement must be met with at least

56.25% CET1 capital and no more than

25% tier 2 capital. In addition, the capital

that firms use to meet their minimum

requirements (Pillar 1 and Pillar 2A) cannot

be counted towards meeting the

combined buffer requirement.

The PRA may also impose a confidential

'PRA buffer' to cover risks over a forward

looking planning horizon, including with

regard to firm-specific stresses or

management and governance

weaknesses. The PRA buffer must be met

separately to the combined buffer

requirement, and must be met fully with

CET1 capital.

As part of its approach to ring fencing, the

FPC established a framework to apply a

firm-specific systemic risk buffer (SRB).

The purpose of the SRB was to increase

the capacity of ring-fenced bodies, such as

Barclays Bank UK PLC, to absorb stress.

With the implementation of CRD V, the

Other Systemically Important Institutions

Buffer (O-SII buffer) replaced the SRB. The

O-SII buffer can be set between 0% and

3% and has to be met solely with CET1

capital. The O-SII buffer rate applicable to

Barclays Bank UK PLC is currently set by

the PRA at 1%.

Previously, total assets were used as the

metric to determine O-SII buffer rates but

the FPC announced in 2022 that this would

change to the UK leverage exposure

measure and that it would recalibrate the

thresholds used to determine O-SII buffer

rates to prevent an overall tightening or

loosening of the framework relative to its

pre-Covid level. The PRA’s 2023 review of

the O-SII buffer was based on end-2022

leverage exposure measures and

maintained the O-SII buffer rate applicable

to Barclays Bank UK PLC at 1% (applicable

from January 2025). For future reviews,

the average of firms’ quarter-end leverage

exposure measure over the year will be

used to determine O-SII buffer rates,

rather than the year-end value. In addition,

Barclays Bank Ireland PLC is identified as a

O-SII by the CBI, which has imposed an O-

SII buffer on Barclays Bank Ireland PLC of

1%.

On 30 November 2022, the PRA published

a consultation paper concerning the

implementation of the remaining Basel III

standards, which include a revised

standardised approach for credit risk, the

elimination of modelled approaches for

certain credit risk exposure categories, a

new standardised approach for operational

risk, a new market risk approach and the

implementation of an output floor

requiring reported RWAs calculated under

standardised and modelled approaches to

be a minimum of 72.5% of fully

standardised calculations. In December

2023 the PRA published its first collection

of near-final policy proposals for

implementing these measures, including

those for market risk, operational risk and

the Credit Valuation Adjustment (CVA) and

counterparty credit risk. A further

collection of policies, including those for

credit risk and credit risk mitigation, are

expected to be published by the PRA in Q2

2024. The implementation date for these

standards has been extended to 1 July

2025. In June 2023, the EU reached a

provisional agreement on the

implementation of the remaining parts of

the Basel III reforms. In December 2023,

the preparatory bodies of the Council and

Parliament endorsed this banking package.

It consists of a legislative act to amend the

Capital Requirements Directive (Directive

2013/36/EU), and a legislative act to

amend the Capital Requirements

Regulation (Regulation No (EU)2013/575)

(referred to as CRR III and CRD VI,

respectively). The relevant measures are

scheduled to apply from January 2025 and

mid-2025 respectively.

In the US,  the Barclays Bank Group

(including BUSL) is subject to prudential

requirements for large domestic US

banking organisations, foreign banking

organisations and their intermediate

holding companies (IHCs) set by the FRB

and other US regulatory agencies. BUSL is

a “Category III” IHC. BUSL (and Barclays

Bank Delaware) is subject to reduced

(calibrated at 85%) standardised liquidity

requirements, including the liquidity

coverage ratio and NSFR.

BUSL is also subject to the FRB’s rules

regarding single counterparty credit limits

(SCCL). The SCCL apply to the largest US

BHCs and foreign banks’ (including the

Group’s) US operations. The SCCL creates

two separate limits for foreign banks, the

first on combined US operations (CUSO)

and the second on the US IHC (BUSL). The

SCCL for BUSL, as a US BHC, requires that

exposure to an unaffiliated counterparty of

BUSL not exceed 25% of BUSL’s tier 1

capital. With respect to the CUSO, the

SCCL rule allows certification to the FRB

that a foreign bank complies with

comparable home country regulation.

Barclays Bank PLC has complied with the

CUSO requirement since 1 January 2022,

with the first certification applicable for its

Q1 2022 results.  To date, Barclays Bank

PLC has not relied on home country

certification.

In July 2023, the FRB and other US

regulatory agencies proposed changes to

the regulatory capital rules applicable to US

banks, BHCs and IHCs with total

consolidated assets of $100 billion or more

(Large Banking Organizations). These

changes are intended to be broadly

consistent with revisions to Basel III

finalised by the Basel Committee on

Banking Supervision in 2017. The US

proposal would end the use of internal

models for credit risk, credit valuation

adjustments, and operational risk, create

an expanded risk-based credit capital

approach in addition to retaining a

modified version of the current

standardised approach, and make changes

to the modelling requirements for market

risk. A Large Banking Organization would

be required to calculate its risk-based

capital ratios under both the expanded

risk-based approach and the current

standardised approach and would use the

lower of the two. All capital buffer

requirements would apply regardless of

whether the expanded risk-based

approach or the existing standardised

approach produces the lower ratio. The

proposal was subject to a public comment

period which ended on 16 January 2024,

and would not be effective until 1 July

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2025. Certain aspects of the proposal

would be subject to a three-year phase-in

period. We are analysing the potential

effects of the proposed changes, including

the timing of implementation.

Stress testing

The Group and certain of its members are

subject to supervisory stress testing

exercises in a number of jurisdictions,

designed to assess the resilience of banks

to adverse economic or financial

developments and ensure that they have

robust, forward-looking capital planning

processes that account for the risks

associated with their business profile.

Assessment by regulators is on both a

quantitative and qualitative basis, the latter

focusing on such elements as data

provision and stress testing capability,

including model risk management and

internal management processes and

controls.

Recovery and Resolution

Stabilisation and resolution framework

The current UK framework for recovery

and resolution was established by the

Banking Act 2009, as amended. The EU

framework was established by the 2014

Bank Recovery and Resolution Directive

(BRRD), as amended by BRRD II.

The BoE, as the UK resolution authority,

has the power to resolve a UK financial

institution that is failing or likely to fail by

exercising certain stabilisation tools,

including (i) bail-in: the cancellation,

transfer or dilution of a relevant entity’s

equity and write-down or conversion of

the claims of a relevant entity's unsecured

creditors (including holders of capital

instruments) and conversion of those

claims into equity as necessary to restore

solvency; (ii) the transfer of all or part of a

relevant entity's business to a private

sector purchaser; and (iii) the transfer of all

or part of a relevant entity's business to a

“bridge bank” controlled by the BoE. When

exercising any of its stabilisation powers,

the BoE must generally provide that

shareholders bear first losses, followed by

creditors in accordance with the priority of

their claims in insolvency.

In order to enable the exercise of its

stabilisation powers, the BoE may impose

a temporary stay on the rights of creditors

to terminate, accelerate or close out

contracts, or override events of default or

termination rights that might otherwise be

invoked as a result of a resolution action

and modify contractual arrangements in

certain circumstances (including a

variation of the terms of any securities).

HM Treasury may also amend the law for

the purpose of enabling it to use its powers

under this regime effectively, potentially

with retrospective effect.

In addition and distinct from bail-in, the

BoE has the power to permanently write-

down, or convert into equity, tier 1 capital

instruments, tier 2 capital instruments and

internal eligible liabilities at the point of

non-viability of an institution pursuant to

broader resolution powers under the

Banking Act.

The BoE’s preferred approach for the

resolution of the Group is a bail-in strategy

with a single point of entry at Barclays PLC.

Under such a strategy, Barclays PLC’s

subsidiaries would remain operational while

Barclays PLC’s capital instruments and

eligible liabilities would be written down or

converted to equity in order to recapitalise

the Group and allow for the continued

provision of services and operations

throughout the resolution. The order in

which the bail-in tool is applied reflects the

hierarchy of capital instruments under

applicable UK legislation and rules, and

otherwise respecting the hierarchy of

claims in an ordinary insolvency.

Accordingly, the more subordinated the

claim, the more likely losses will be suffered

by owners of the claim.

The PRA has made rules that require

authorised firms to draw up recovery plans

and resolution packs. Recovery plans are

designed to outline credible actions that

authorised firms could implement in the

event of severe stress in order to restore

their business to a stable and sustainable

condition. The submission of resolution

packs was suspended by the PRA in 2018

until further notice and replaced by annual

resolution reporting. It continues to be

suspended pending PRA assessment of

areas of potential duplication between

different reporting expectations. The

Barclays Group, however, is required to

provide the PRA with a recovery plan

biennially, although the Group maintains

and refreshes  this on an annual basis.

Removal of potential impediments to an

orderly resolution of a banking group or

one or more of its subsidiaries is

considered as part of the BoE’s resolution

planning for each firm, and the BoE can

require firms to make significant changes

in order to enhance their resolvability.

Under the BOE’s Resolvability Assessment

Framework (RAF) firms are required to

have in place capabilities covering three

resolvability outcomes: (i) adequate

financial resources; (ii) being able to

continue to do business through

resolution and restructuring; and (iii) being

able to communicate and co-ordinate

within the firm and with authorities.

Barclays Group’s second self-assessment

report on resolvability under the RAF was

submitted to the PRA/BoE in 2023 and

public disclosures by both Barclays Group

and the PRA/BoE on the most recent

report are due in June 2024. Updated

reports and disclosures are required every

two years. The BoE’s assessment on the

2021 report, published in June 2022,

concluded that there were no

shortcomings, deficiencies or substantive

impediments identified in the Group’s

resolution capabilities that could impede

its ability to execute the preferred

resolution strategy. In future, should any

such issues be identified, the PRA/BoE

could exercise its various powers to direct

the Group to address the relevant issues.

While regulators in many jurisdictions have

indicated a preference for single point of

entry resolution for the Group, additional

resolution or bankruptcy provisions may

apply to certain non-UK Group entities or

branches.

In the US, BUSL is subject to the Orderly

Liquidation Authority established by Title II

of the Dodd-Frank Act (DFA), a regime for

the orderly liquidation of systemically

important financial institutions by the

FDIC, as an alternative to proceedings

under the US Bankruptcy Code. In addition,

the licensing authorities of Barclays Bank

PLC New York branch and of Barclays Bank

Delaware have the authority to take

possession of the business and property

of the applicable branch or entity they

license and/or to revoke or suspend such

licence.

In the US, Title I of the DFA, as amended,

and the implementing regulations issued

by the FRB and the FDIC require each bank

holding company with assets of $250bn or

more, including those within the Group, to

prepare and submit a plan for the orderly

resolution of subsidiaries and operations in

the event of future material financial

distress or failure. The Group submitted a

“targeted plan” in December 2021. The

agencies did not identify any shortcomings

or deficiencies with the Group’s 2021 US

Resolution Plan. In August 2023, the FRB

and FDIC proposed new guidance for

triennial full filers (such as the Group) that

would affect the content required to be

included in the US Resolution Plan. The

proposal generally represents an

expansion of the current 165(d) resolution

planning guidance the Group is subject to

as a “specified foreign banking

organization.” The Group’s next

submission of the US Resolution Plan in

respect of its US operations will be a “full

plan” due 31 March 2025, unless the FRB

and FDIC provide a further extension.

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Barclays Bank Ireland PLC is required by

the ECB to submit a standalone BRRD

compliant recovery plan on an annual

basis. As a Significant Institution under

direct ECB supervision, Barclays Bank

Ireland PLC falls within the remit of the

Single Resolution Board (SRB), as the

resolution authority for the European

Banking Union. Under the provisions of the

BRRD and EU Single Resolution

Mechanism Regulation (SRMR), the SRB is

required to determine the optimal

resolution strategy for Barclays Bank

Ireland PLC and, also, to prepare a

resolution plan for the bank. The SRB

undertakes this work within the context of

the BoE’s preferred resolution strategy of

single point of entry with bail in at Barclays

PLC. In order to carry out its mandate, the

SRB collects detailed structural and other

information from Barclays Bank Ireland

PLC on a regular basis, as well as engaging

with the bank to identify and address

impediments to resolution. This work is

done in coordination with the BoE, as the

Group resolution authority. Barclays Bank

Ireland PLC is required to meet the SRB’s

requirements for resolution as set out in

the SRB’s ‘Expectations for Banks’

document by 31 July 2024 (this deadline

was extended by the SRB in October 2023

from the original deadline of 31 December

2023).

In April 2023, the EU Commission

proposed certain reforms to strengthen

the EU’s bank crisis management and

deposit insurance (CMDI) framework,

including extending depositor protection

to public entities and client money

deposited in certain types of client funds.

The EU legislative process remains

ongoing. Provisional agreement was

reached in December 2023 between the

Council and the European Parliament on

the treatment of internal MREL in bank

resolution groups, referred to as the ‘Daisy

Chains’ proposal (a confined part of the

CMDI proposals). This treatment is

expected to apply from the second half of

2024.

TLAC and MREL

The Group is under the supervision of the

BoE, as the UK resolution authority, and is

subject to a Minimum Requirement for

Own Funds and Eligible Liabilities (MREL),

which includes a component reflecting the

FSB’s standards on total loss absorbency

capacity (TLAC).

Since 1 January 2022, G-SIBs with

resolution entities incorporated in the UK

have been required to meet an MREL

equivalent to the higher of: (i) two times

the sum of their Pillar 1 and Pillar 2A

requirements; or (ii) the higher of two

times their leverage ratio requirement or

6.75% of leverage exposures. Internal

MREL for operating subsidiaries is subject

to a scalar in the 75-90% range of the

external requirement that would apply to

the subsidiary if it were a resolution entity.

The starting point for the scalar is 90% for

ring-fenced bank sub-groups.

Barclays Bank Ireland PLC is subject to the

SRB’s MREL policy, as issued in May 2023,

in respect of the internal MREL that it will

be required to issue to the Group. The

SRB’s current calibration of internal MREL

for non-resolution entities is expressed as

two ratios that have to be met in parallel:

(a) two times the sum of: (i) the firm’s Pillar

1 requirement; and (ii) its Pillar 2

requirement; and (b) two times the

leverage ratio requirement. The SRB’s

policy does not apply any scalar in respect

of the internal MREL requirement. Under

the SRB MREL policy, a bank specific

adjustment can be applied by the SRB to

MREL requirements. From 1 January 2024,

a revised deduction regime will apply for

the indirect subscription of instruments

eligible for internal MREL to avoid the

double-counting of MREL elements at the

level of intermediate entities within a

resolution group.

In the US, the FRB’s TLAC rule includes

provisions that require BUSL to have: (i) a

specified outstanding amount of eligible

long-term debt; (ii) a specified outstanding

amount of TLAC (consisting of common

and preferred equity regulatory capital plus

eligible long-term debt); and (iii) a specified

common equity buffer. In addition, the

FRB’s TLAC rule prohibits BUSL, for so

long as the Group’s overall resolution plan

treats BUSL as a non-resolution entity,

from issuing TLAC to entities other than

those within the Group.

Bank Levy and FSCS

The BRRD established a requirement for

EU member states to set up a pre-funded

resolution financing arrangement with

funding equal to 1% of covered deposits

by 31 December 2024 to cover the costs

of bank resolutions. The UK implemented

this requirement by way of a tax on the

balance sheets of banks known as the

‘Bank Levy’, which remains in place.

In addition, the UK has a statutory

compensation fund called the Financial

Services Compensation Scheme (FSCS),

which is funded by way of annual levies on

most authorised financial services firms.

Structural reform

In the UK, the Financial Services (Banking

Reform) Act 2013 put in place a framework

for ring-fencing certain operations of large

banks. Ring-fencing requires, among other

things, the separation of the retail and

smaller deposit-taking business activities

of UK banks into a legally distinct,

operationally separate and economically

independent entity (a ‘ring-fenced bank’),

which is not permitted to undertake a

range of activities. In 2023, HM Treasury

issued a public call for evidence on aligning

the ring-fencing and resolution regimes,

amongst other things, and a consultation

on reforms to the ring-fencing regime,

including amendments to the thresholds

above which the regime applies, permitting

ring-fenced banks to establish branches

and subsidiaries outside the UK or the EEA

and the introduction of a transitional

period for compliance with the ring-

fencing regime following mergers or

acquisitions. HM Treasury plans to

introduce legislation to implement these

reforms in early 2024. The PRA consulted

on complementary reforms to HM

Treasury's proposals in 2023 and,

separately, conducted a review of its ring-

fencing rules in compliance with its

statutory duty under FSMA to do so every

five years. The PRA announced in early

2024 that it intends to consult on targeted

reforms to its ring-fencing rules as a result

of its review, although the overall

conclusion was that most of those rules

are performing satisfactorily.

US regulation places further substantive

limits on the activities that may be

conducted by banks and holding

companies, including foreign banking

organisations such as the Group. The

‘Volcker Rule’, which was part of the DFA

and which came into effect in the US in

2015, prohibits banking entities from

undertaking certain proprietary trading

activities and limits such entities’ ability to

sponsor or invest in certain private equity

funds and hedge funds (in each case

broadly defined). As required by the rule,

the Group has developed and

implemented an extensive compliance and

monitoring programme addressing

proprietary trading and covered fund

activities (both inside and outside of the

US).

Market infrastructure regulation

In recent years, regulators as well as

global-standard setting bodies such as the

International Organization of Securities

Commissions (IOSCO) have focused on

improving transparency and reducing risk

in markets, particularly risks related to

over-the-counter (OTC) derivative

transactions. This focus has resulted in a

variety of new regulations across the G20

countries and beyond that require or

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encourage on-venue trading, clearing,

posting of margin and disclosure of pre-

trade and post-trade information.

In particular, the Markets in Financial

Instruments Directive and Markets in

Financial Instruments Regulation

(collectively referred to as MiFID II) have

affected many of the markets in which the

Group operates, the instruments in which

it trades and the way it transacts with

market counterparties and other

customers. MiFID II is currently undergoing

a review process in the EU as part of the

EU’s ongoing focus on the development of

a stronger Capital Markets Union. In the

UK, FSMA 2023 introduced reforms to

remove certain requirements which were

previously applicable to trading in

wholesale markets and to promote

investment in line with the Wholesale

Markets Review. Other changes proposed

by the review are being progressed by way

of amendments to regulatory rules and

guidance.

Regulation of benchmarks

The EU and UK Benchmarks Regulation

apply to the administration, contribution

and use of benchmarks within the EU and

the UK, respectively. Financial institutions

within the EU or the UK, as applicable, are

prohibited from using benchmarks unless

their administrators are authorised,

registered or otherwise recognised in the

EU or the UK, respectively. This prohibition

does not currently apply in respect of third

country benchmark administrators, as the

prohibition on usage of such benchmarks

will take effect from the end of 2025 (EU)

and 2030 (UK). The FCA has also been

working to phase out use of LIBOR, with all

LIBOR panels now having ended. Synthetic

versions of GBP and USD LIBOR have been

made available only for a limited period of

time for holders of legacy contracts. Global

regulators in conjunction with the industry

have developed and are continuing to

develop alternative benchmarks and risk-

free rate fallback arrangements, including

updates to existing, as well as new,

applicable legislation.

Regulation of the derivatives market

The European Market Infrastructure

Regulation (EMIR) introduced

requirements designed to improve

transparency and reduce the risks

associated with the derivatives market.

EMIR has operational and financial impacts

on the Group, including by imposing

collateral requirements and a requirement

to centrally clear certain OTC derivatives

contracts on a broad range of market

participants. Access to the clearing

services of certain Central Counterparties

(CCPs) used by Group entities is currently

permitted under temporary equivalence

and recognition regimes and decisions in

the UK and EU. If not extended or made

permanent, the EU’s equivalence decision

for UK Central Counterparties (CCPs), and

exemption for certain intragroup

transactions from the EMIR derivatives

clearing and margin obligations, both due

to expire at the end of June 2025, could

also have operational and financial impacts

on the Group, as could the removal of

temporary recognition of non-UK CCPs by

the UK. The EU has introduced two

legislative proposals to amend EMIR which

introduce, inter alia, changes to the

intragroup transactions exemption making

it easier to rely on the exemption, as well as

aiming to reduce the concentration of

exposures to systemically important third-

country central counterparties (in

particular, UK Central Counterparties). The

legislative process is ongoing.

US regulators have imposed similar rules

as in the EU with respect to the mandatory

on-venue trading and clearing of certain

derivatives, and post-trade transparency,

as well as in relation to the margining of

OTC derivatives. In December 2017, the

CFTC and the European Commission

recognised the trading venues of each

other’s jurisdiction to allow market

participants to comply with mandatory on-

venue trading requirements while trading

on certain venues recognised by the other

jurisdiction. In December 2022, the CFTC

extended temporary relief that would

permit trading venues and market

participants located in the UK to continue

to rely on this mutual recognition

framework following the withdrawal of the

UK from the EU.

Certain participants in US swap markets

are required to register with the CFTC as

‘swap dealers’ or ‘major swap participants’

and/or, with the SEC as ‘security-based

swap dealers’ or ‘major security-based

swap participants’. Such registrants are

subject to CFTC and/or SEC regulation

and oversight. Barclays Bank PLC is

provisionally registered with the CFTC as a

swap dealer and conditionally registered

with the SEC as a security-based swap

dealer. In addition, Barclays Bank Ireland

PLC is provisionally registered as a Swap

Dealer with the CFTC.

Accordingly, Barclays Bank PLC and

Barclays Bank Ireland PLC are both subject

to CFTC rules on business conduct,

record-keeping and reporting, and

Barclays Bank PLC is subject to SEC rules

on business conduct, record-keeping and

reporting. However, since Barclays Bank

PLC and Barclays Bank Ireland PLC are

non-US swap dealers, they are only subject

to certain of the CFTC’s requirements in

respect of swap transactions with US

persons and certain persons guaranteed

by or affiliated with US persons. In addition,

since Barclays Bank PLC is a non-US

security-based swap dealer, it is only

subject to certain of the SEC’s

requirements in respect of security-based

swap transactions with US persons or

which are arranged, negotiated, or

executed by US personnel. Additionally,

Barclays Bank PLC and Barclays Bank

Ireland PLC have elected to comply with

certain CFTC/SEC requirements, as

applicable, through ‘substituted

compliance’ with EU/UK requirements

pursuant to relevant determinations and

related relief issued by the SEC and the

CFTC, as applicable.

Barclays Bank PLC and Barclays Bank

Ireland PLC are subject to FRB rules on

capital and margin.

In 2022, the SEC proposed new rules that

would require any person with a security-

based swap position (aggregated across all

affiliated persons) that exceeds any of the

thresholds specified by the SEC to

promptly report certain information by the

next business day, including the identity of

the reporting person and the security-

based swap position, as well as the

ownership of securities positions related

to the security-based swap position. Such

reports would be available publicly. If

adopted as proposed, this rule could

increase the burden and cost to Barclays

Bank PLC of utilising security-based

swaps.

Other regulatory developments in the

US

In 2023, the SEC finalised amendments to

shorten the standard settlement cycle for

most broker-dealer transactions in

securities from two business days after the

trade (T+2) to one business day after the

trade (T+1), which requires significant

changes to BCI’s settlement procedures

and practices, and  introduced new rules

requiring market-wide improvements in

the rate of same-day affirmations and on

central matching service providers.

On 13 October 2023, the SEC adopted

new rules to establish broad reporting

requirements of the terms of securities

loans to FINRA for public dissemination,

and requiring FINRA to make publicly

available certain information it receives

regarding those lending transactions.

On 13 October 2023, the SEC adopted

new rules requiring a wide range of firms to

file monthly reports with the SEC for large

short positions in equity securities on a

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new Form SHO, and amendments to the

National Market System plan governing

the Consolidated Audit Trail, which adds an

additional reporting requirement for CAT-

reporting firms relying on the bona fide

market maker exception to Reg SHO’s

locate requirement.

On 30 October 2023, the SEC issued

exemptive relief, which exempts broker-

dealers from their review obligations

concerning the issuer of an over-the-

counter security prior to publication or

submission of a quotation in that security

with respect to a fixed-income security to

be sold in compliance with the safe harbor

in Rule 144A under the Securities Act of

1933.

On 13 December 2023, the SEC adopted

rule amendments under the Exchange Act

that, among other things, will mandate

central clearing of certain US Treasury

securities transactions and amend the

broker-dealer customer protection rule as

it applies to margin posted for transactions

in US Treasury securities. These rule

amendments could impose additional

costs on the Group’s Treasury securities

trading activity.

The SEC has also put forth a number of

other recent proposals that, if adopted,

could have a significant impact on the

Group’s business and operations, including

a series of market structure proposals

which would have a significant impact on

securities trading activity by BCI and other

Group entities, as the SEC proposals would

(a) impose a new SEC best execution

obligation on securities broker-dealers,

including BCI, (b) require that certain

individual investor orders be exposed to

auctions before they could be executed

internally by certain trading centres, and (c)

amend certain rules under Regulation NMS

(National Market System) to adopt variable

minimum pricing increments, reduce

access fee caps for protected quotations,

require that the amount of exchange fees

and rebates be determinable at the time of

execution, and update and expand to

certain broker-dealers the disclosures

required for order executions in NMS

stocks, among other changes.

Other regulation

Consumer protection, culture, and

diversity and inclusion

In July 2023, the FCA’s new Consumer

Duty came into force for new and existing

products or services that are open to sale

or renewal. It will apply to closed products

and services from 31 July 2024. The duty

sets higher expectations for the standard

of care that firms provide to retail

customers and impacts all aspects of

Barclays' retail businesses, including every

retail customer journey, product and

service as well as our relationships with

partners, suppliers and third parties. This

has resulted in significant implementation

costs and there will also be higher ongoing

costs for the industry as a result of

extensive monitoring and evidential

requirements.

Our regulators have enhanced their focus

on the promotion of cultural values as a

key area for banks. The UK regulators have

also begun focusing on diversity and

inclusion in financial services firms, with the

PRA and FCA having published a

consultation on the introduction of a new

regulatory framework on diversity and

inclusion in September 2023. The UK

regulators expect to publish final rules on

this issue in 2024.

FSMA 2023 contains provisions mandating

that the Payment Systems Regulator

(PSR) require the reimbursement of

authorised push payment scams by

payment service providers, including

Barclays. This reimbursement requirement

will be split 50:50 between the sending and

receiving firms. Changes to the rules of the

Faster Payments Scheme and a new

Specific Direction issued by the PSR to

require reimbursement will take effect in

October 2024.

Data protection

Most jurisdictions where the Group

operates have adopted or are considering

comprehensive laws concerning data

protection and privacy. Regulations

regarding data protection are increasing in

number, as well as levels of enforcement,

as manifested in increased amounts of

fines and the severity of other penalties.

We expect that personal privacy and data

protection will continue to receive

attention and focus from regulators, as

well as public scrutiny and attention.

The EU’s General Data Protection

Regulation (GDPR) and the UK’s General

Data Protection Regulation (UK GDPR)

provide a framework of rights and duties

designed to safeguard personal data and

apply to the activities conducted from an

establishment in the EU or the UK,

respectively. The extraterritorial effect of

the GDPR and the UK GDPR means

entities established outside the EU or the

UK may fall within the GDPR or the UK

GDPR’s ambit when offering goods or

services to EU/UK based customers or

clients or conducting behavioural

monitoring of individuals in the EU/UK. The

Data Protection and Digital Information

(No.2) Bill was introduced to the UK

Parliament in March 2023, which if enacted

will bring some divergence between the EU

GDPR and UK GDPR. The UK government

has indicated that it expects the Bill to

become law in mid-2024, although there is

still some uncertainty on timing and

content.

The data regime in China is likely to

continue to evolve, governing the

collection, processing and cross-border

transfers of China-based individuals'

personal data and related restricted data

(e.g., macro/derived characteristics data

which, if tampered with, divulged or

destroyed, may endanger China's

economic operation, social stability,

national security - among other things -

having regard to the volume and

granularity of the data). In India, the Digital

Personal Data Protection Act, 2023, may

be implemented in phases during 2024 and

beyond. Except under certain exemptions,

its scope would include the processing of

personal data in India and would extend to

the profiling of, and offering goods and

services to, India-based individuals outside

of India. As the global data protection

regulatory landscape develops, non-

compliance with any such requirements

and rules could lead to regulatory fines and

other penalties.

In the US, Barclays Bank Delaware is

subject to the US Federal Gramm-Leach-

Bliley Act (GLBA) and the California Privacy

Rights Act of 2020, which amended the

California Consumer Privacy Act of 2018

and came into effect on 1 January 2023

(CPRA). The GLBA limits the use and

disclosure of non-public personal

information to non-affiliated third parties,

and requires financial institutions to

provide written notice of their privacy

policies and practices and implement

certain information security policies and

practices. Any violations of the GLBA could

subject Barclays Bank Delaware to

additional reporting requirements or

regulatory investigation or audits by the

financial regulators. More broadly, the

Group's US operations are subject to the

CPRA which applies to personal

information that is not collected,

processed, sold or disclosed subject to the

GLBA. The CPRA requires applicable

members of the Group to both provide

California residents with additional

disclosures regarding the collection, use

and sharing of personal information and

grant California residents access, deletion,

correction and other rights, including the

right to opt-out of certain sales or

transfers of personal information and the

right to limit the processing of sensitive

personal information to certain purposes.

Any violations of the CPRA may be subject

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to enforcement by the California Privacy

Protection Agency and the California

Attorney General and the imposition of

monetary penalties, as well as potential

lawsuits arising from the private right of

action provided to California residents in

the case of certain data breaches. Bills

proposed in the United States Congress

and in the legislatures of various US states,

if enacted, may have further impact on the

data privacy practices of Barclays’ US

operations. In addition, all 50 states have

laws including obligations to provide

notification of security breaches of

computer databases that contain personal

information to affected individuals, state

officers and others.

Cybersecurity and operational resilience

Regulators globally continue to focus on

cybersecurity risk management,

organisational operational resilience and

overall soundness across all financial

services firms, with customer and market

expectations of uninterrupted access to

financial services remaining at an all-time

high.

The regulatory focus has been further

heightened by the increasing number of

high-profile ransomware and other supply

chain attacks seen across the industry in

recent years and the growing reliance of

financial services on Cloud and other third

party service providers. This is evidenced

by the continuing introduction of new laws

and regulatory frameworks directed at

enhancing resilience of both firms and

their critical third party providers. A new UK

framework introduced in March 2021

requires firms to be able to remain within

impact tolerances set for their important

business services, in severe but plausible

disruption scenarios such as a cyber

attack, by no later than 31 March 2025.

FSMA 2023 introduced a new regime for

designated critical third party providers,

and in 2023 the FCA and PRA issued a

consultation on proposed rules and

guidance for supervising the resilience of

critical third party providers.

The EU’s Digital Operational Resilience Act

(DORA) entered into force in January 2023

and will apply in early 2025 (after a two-

year implementation period), introducing

comprehensive and sector specific

regulation on Information Communication

Technologies (ICT) incident reporting,

testing and third party risk management,

and providing for direct oversight of critical

third party providers servicing the EU

financial services sector. The existing and

anticipated requirements for increased

controls will serve to improve industry

standardisation and resilience capabilities,

enhancing our ability to deliver services

during periods of potential disruption.

However, such measures are likely to

result in increased technology and

compliance costs for the Group.

In 2023, the SEC finalised disclosure rules

regarding cybersecurity risk management,

governance and incident reporting by US-

listed companies, including foreign private

issuers such as Barclays PLC and Barclays

Bank PLC. The new rules require foreign

private issuers to annually disclose the

policies and procedures relied upon to

identify and manage cybersecurity risks,

including risk management strategy and

whether any risks from cybersecurity

threats, including as a result of any

previous cybersecurity incidents, have

materially affected or are reasonably likely

to materially affect the issuer, its business

strategy, results of operations or financial

condition. In addition, Barclays PLC and

Barclays Bank PLC must annually describe

Barclays’ board of directors’ oversight of

risks from cybersecurity threats, the board

committee responsible for the oversight

of such risks, and the processes by which

the board or such committee is informed

thereof; and details of management’s

expertise and role in assessing and

managing material risks from

cybersecurity threats. If Barclays PLC or

Barclays Bank PLC are required or

determine to disclose material

cybersecurity incidents under home

country or stock exchange rules, they are

required to also furnish this information

with the SEC on the SEC's website, in

accordance with their obligations as

foreign private issuers.

Similarly, NYDFS amended its

cybersecurity regulation applying to the

New York Branch of Barclays Bank PLC.

The NYDFS's amended cybersecurity

regulation contains significant updates,

including enhanced notification

requirements, cybersecurity governance

obligations, and requirements applicable to

cybersecurity policies and procedures

(e.g., encryption and multi-factor

authentication, business continuity and

incident response plans, and vulnerability

management).

Regulatory initiatives on ESG disclosure

The EU Regulation on Sustainable Finance

Disclosures Regulation (SFDR) and related

Delegated Regulations require financial

market participants (FMPs) to disclose how

they integrate environmental, social and

governance factors in their investment

decisions for certain financial products and

to publish principal adverse impact

statements. The SFDR applies to entities

established in the EU and in-scope

products marketed in the EU, regardless of

the location of the entity. The SFDR is

currently under review by the Commission.

In addition, the EU Taxonomy Regulation

provides for a general framework for the

development of an EU-wide classification

system for environmentally sustainable

economic activities. It sets mandatory

entity-level disclosure requirements for

companies which fall under the scope of

the EU Accounting Directive, in relation to

eligibility and alignment of their business

activities with the EU Taxonomy

Regulation. The EU Taxonomy Regulation

also imposes product level disclosure

obligations for FMPs on the extent to

which their financial products are

Taxonomy aligned or not. The taxonomy,

and with it the Taxonomy Regulation, is

under review to include further sectors

and, for example, social elements.

The EU Corporate Sustainability Reporting

Directive will introduce sustainability

related reporting obligations for various

entities, including EU banks and certain

non-EU companies and banks (by virtue of

having EU listings or significant business in

the EU), with reporting to commence on a

phased basis from the financial year 2024.

Related technical sustainability reporting

standards have been developed by the

European Financial Reporting Advisory

Group.

The second EU Capital Requirements

Regulation established, for certain large

financial institutions, a Pillar 3 disclosure

framework for information on

environmental, social and governance

risks, including physical risks and transition

risks. Amendments proposed by the CRR

III and CRD VI banking package will extend

the scope of these disclosures and the

emphasis on ESG. The ECB has made, and

continues to regard, the supervision of the

approach of institutions to ESG risk a

priority.

In December 2023, the European Council

and Parliament institutions reached

political agreement on the Directive on

Corporate Sustainability Due Diligence,

which will require EU firms, and certain

non-EU firms, including financial

institutions, to carry out due diligence with

regard to their own operations and

companies in their upstream value chain, in

order to identify and prevent, bring to an

end or mitigate the adverse impact of their

activities on human rights and the

environment. Firms will also be required to

establish a climate change transition plan.

These obligations are expected to come

into force on a phased basis from the

second half of 2027, at the earliest.

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In the UK, the FCA published final rules on

the UK Sustainability Disclosure

Requirements regime in November 2023

which set out new requirements to

prepare sustainability-related product and

entity level disclosures for certain firms, as

well as a new sustainable investment

labelling regime and anti-greenwashing

rule applicable to all authorised firms.

Currently, the new anti-greenwashing rule

(and associated guidance) is due to apply

from 31 May 2024, whilst the rest of the

changes will take effect on a phased basis,

beginning in the second half of 2024.  The

UK Government has expressed its

intention to consider how best to

incorporate the Taskforce on Nature-

related Financial Disclosures framework

for nature-related risk management and

disclosures into UK legislation and to

consult on introducing Transition Plan

Taskforce Disclosure Framework (TPT

Framework) related requirements for the

UK’s largest companies. The Government

is also progressing plans to endorse UK

Sustainability Disclosure Standards based

on the International Sustainability

Standards Board (ISSB) sustainability

reporting standards (IFRS S1 on general

requirements for sustainability disclosures

and IFRS S2 on climate disclosures) for use

in the UK by July 2024.  The FCA plans to

consult in 2024 on incorporating

provisions relating to the ISSB standards

and TPT Framework into its Handbook.

Additionally, TCFD-aligned reporting

requirements apply to UK publicly quoted

companies, large private companies and

LLPs (in addition to existing TCFD-related

reporting requirements under the Listing

Rules).

In the UK, the UK Government has

confirmed its intention to develop a UK

Green Taxonomy, and the Green

Technical Advisory Group continues to

publish advice and reports on the

development of a Green Taxonomy.

Reporting against the Taxonomy will form

part of the UK’s new Sustainability

Disclosure Requirements (SDR). Certain

companies will be required to disclose

which portion of their activities are

Taxonomy-aligned. The structure of the

Taxonomy is expected to draw on the EU

approach and has six environmental

objectives (climate change mitigation,

climate change adaptation, sustainable

use and protection of water and marine

resources, transition to a circular

economy, pollution prevention and control

and protection and restoration of

biodiversity).

In March 2022, the SEC proposed climate

related-disclosure requirements for US-

listed companies (which would include

Barclays PLC and Barclays Bank PLC) that

would, among other things, require

disclosure of direct and indirect

greenhouse gas emissions, with certain

emissions disclosures subject to third-

party attestation requirements; climate-

related scenario analysis (if the issuer

conducts scenario analysis), together with

qualitative and quantitative information

about the hypothetical future climate

scenarios used in its analysis; climate

transition plans or climate-related targets

or goals, along with disclosure of progress

against any such plans, targets or goals;

climate-related risks over the short-,

medium- and long-term; qualitative and

quantitative information regarding

climate-related risks and historical impacts

in audited financial statements; corporate

governance of climate-related risks; and

climate-related risk-management

processes. In addition, bills proposed or

adopted by the legislatures of certain US

states may impose additional or stricter

climate related-disclosure requirements

on businesses operating in such US states.

For example, in October 2023, California

adopted the Climate Corporate Data

Accountability Act (SB-253) and the

Greenhouse Gases: Climate-Related

Financial Risk bill (SB-261) which are

expected to apply commencing in 2026.

Barclays is monitoring such legislative

developments and their impact on

Barclays’ US operations and reporting

obligations.

Sanctions and financial crime

The UK Bribery Act 2010 introduced a new

form of corporate criminal liability focused

broadly on a company’s failure to prevent

bribery on its behalf. The Criminal Finances

Act 2017 introduced new corporate

criminal offences of failing to prevent the

facilitation of UK and overseas tax evasion.

In 2023, the Economic Crime and

Corporate Transparency Act 2023

became law. This creates a new offence of

failing to prevent a person associated with

the Group from committing fraud for the

benefit of the Group. These pieces of

legislation have broad application and in

certain circumstances may have

extraterritorial impact on entities, persons

or activities located outside the UK,

including Barclays PLC’s subsidiaries

outside the UK.

The UK Bribery Act requires the Group to

have adequate procedures to prevent

bribery which, due to the extraterritorial

nature of the Act, makes this both

complex and costly. Additionally, the

Criminal Finances Act requires the Group

to have reasonable procedures in place to

prevent the criminal facilitation of tax

evasion by persons acting for, or on behalf

of, the Group. The Economic Crime and

Corporate Transparency Act similarly

requires the Group to have reasonable

procedures in place to prevent a person

associated with the Group from

committing fraud.

The Sanctions and Anti-Money Laundering

Act 2018 (the Sanctions Act) became law

in the UK in 2018. Following the UK’s

withdrawal from the EU, the Sanctions Act

allowed for the adoption of an

autonomous UK sanctions regime which

came into force in 2021, as well as a more

flexible licensing regime post-Brexit. This

regime applies within the UK and in relation

to the conduct of all UK persons wherever

they are in the world; it also applies to

overseas branches of UK companies

(including the Barclays Bank PLC New York

branch).

Within the EU, there is a system of

autonomous sanctions by which the

European Council adopts a decision made

by the EU’s Common Foreign and Security

Policy. The measures stated in the Council

decision are either implemented at the EU

level, by way of Regulation, or at a national

level in Member States. Regulations are

binding and directly effective throughout

the EU. Each measure will specify the

territorial scope of the relevant sanctions

but these can apply broadly within the

territory of any EU Member States and to

EU nationals wherever they are located as

well as to third country branches of EU

companies. The EU enforces its anti-

money laundering regime through the

Fourth Anti-Money Laundering Directive

(EU) 2015/849 and the Fifth Anti-Money

Laundering Directive (EU) 2018/849 with

further changes being proposed through

the Sixth Anti-Money Laundering Directive

and a package of further reforms currently

under discussion.

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In the US, the Bank Secrecy Act, the USA

PATRIOT Act 2001, the Anti-Money

Laundering Act of 2020 and regulations

thereunder contain numerous anti-money

laundering and anti-terrorist financing

requirements for financial institutions. In

addition, the Group is subject to the US

Foreign Corrupt Practices Act, which

prohibits, among other things, corrupt

payments to foreign government officials.

It is also subject to various economic

sanctions laws, regulations and executive

orders administered by the US

government, which prohibit or restrict

some or all business activities and other

dealings with or involving certain

individuals, entities, groups, countries and

territories.

In some cases, US state and federal

regulations addressing sanctions, money

laundering and other financial crimes may

impact entities, persons or activities

located or undertaken outside the US,

including Barclays PLC and its subsidiaries.

US government authorities have

aggressively enforced these laws against

financial institutions in recent years.

As a result of the conflict in Ukraine, there

has been an increased regulatory focus on

sanctions compliance in various

jurisdictions, including the US, UK and EU.

Failure of a financial institution to ensure

compliance with such laws could have

serious legal, financial and reputational

consequences for the institution.

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|  | Financial review | | | |  |  |
|  | A review of the Group’s performance, including  the key performance indicators, and the contribution  of each of our businesses to the overall performance  of the Group. | | | | |  |
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|  | [Key performance indicators](#i4be61753b7f243b19551b0bfbf3a2a0d_808) | | | | [374](#i4be61753b7f243b19551b0bfbf3a2a0d_808) |  |
|  | [Consolidated summary income statement](#i4be61753b7f243b19551b0bfbf3a2a0d_811) | | | | [376](#i4be61753b7f243b19551b0bfbf3a2a0d_811) |  |
|  | [Income statement commentary](#i4be61753b7f243b19551b0bfbf3a2a0d_814) | | | | [377](#i4be61753b7f243b19551b0bfbf3a2a0d_814) |  |
|  | [Consolidated summary balance sheet](#i4be61753b7f243b19551b0bfbf3a2a0d_823) | | | | [378](#i4be61753b7f243b19551b0bfbf3a2a0d_823) |  |
|  | [Balance sheet commentary](#i4be61753b7f243b19551b0bfbf3a2a0d_826) | | | | [379](#i4be61753b7f243b19551b0bfbf3a2a0d_826) |  |
|  | [Analysis of results by business](#i4be61753b7f243b19551b0bfbf3a2a0d_832) | | | | [380](#i4be61753b7f243b19551b0bfbf3a2a0d_832) |  |
|  | [Non-IFRS performance measures](#i4be61753b7f243b19551b0bfbf3a2a0d_853) | | | | [387](#i4be61753b7f243b19551b0bfbf3a2a0d_853) |  |
|  |  |  |  |  |  |  |

In assessing the financial performance of the Group, management uses a range of KPIs which focus on the Group’s financial strength,

the delivery of sustainable returns and cost management. KPIs reflect the targets and ambitions followed during 2023. On 20 February

2024, the Investor Update set out refreshed targets and ambitions which future progress will be measured against. Please see page [13](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686061823)

of the strategic report for further detail, or [home.barclays/who-we-are/our-strategy/](https://home.barclays/strategy)

Non-IFRS performance measures

The Group’s management believes that the non-IFRS performance measures included in this document provide valuable information

to the readers of the financial statements as they enable the reader to identify a more consistent basis for comparing the businesses’

performance between financial periods, and provide more detail concerning the elements of performance which the managers of these

businesses are most directly able to influence or are relevant for an assessment of the Group.

They also reflect an important aspect of the way in which operating targets are defined and performance is monitored by management.

However, any non-IFRS performance measures in this document are not a substitute for IFRS measures and readers should consider

the IFRS measures as well. Refer to the non-IFRS performance measures section for further information and calculations of non-IFRS

performance measures included throughout this section and the most directly comparable IFRS measures.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Definition | Why is it important and how the Group performed |  |
| Common Equity Tier 1 (CET1)  ratio  Capital requirements are part of the  regulatory framework governing how banks  and depository institutions are supervised.  Capital ratios express a bank’s capital as a  percentage of its Risk Weighted Assets  (RWAs) as defined by the PRA.  CET1 ratio is a measure of capital as  defined within the Definition of Capital  section of the PRA's Prudential and  Resolution Policy - Banking Index. | The Group’s capital management objective is to maximise  shareholder value by prudently managing the level and mix  of its capital to: ensure the Group and all of its subsidiaries  are appropriately capitalised relative to their regulatory  minimum and stressed capital requirements, support the  Group’s risk appetite, growth and strategic options, while  seeking to maintain a robust credit proposition for the  Group and its subsidiaries.  The CET1 ratio decreased to 13.8% (2022: 13.9%) as  £4.3bn of attributable profit, including the negative impact  of structural cost actions, was more than offset by returns  to shareholders, impacts of regulatory change from 1  January 2023, the impact of KMC acquisition and  movements in other capital deductions, as well as an  increase in RWAs excluding the impact of foreign exchange  movements, primarily driven by higher CIB and CC&P RWAs.  An £8.2bn decrease in RWAs driven by  foreign exchange  movements was offset by a £1.1bn decrease in CET1  capital due to a decrease in the currency translation reserve  within CET1.  Group target: a CET1 ratio in the range of 13-14%. | CET1 ratio  13.8%  2022: 13.9%  2021: 15.1% |
| Return on average tangible  shareholders’ equity (RoTE)  RoTE is calculated as Group attributable  profit, as a proportion of average tangible  shareholders’ equity | This measure indicates the return generated by the  management of the business based on ordinary  shareholders’ tangible equity. Achieving a target RoTE  demonstrates the organisation’s ability to execute its  strategy and align management’s interests with the  shareholders’. RoTE lies at the heart of the Group’s capital  allocation and performance management process.  Statutory RoTE was 9.0%  (2022: 10.4%) including £0.9bn of  structural cost actions in Q423. Excluding Q423 structural  cost actions, RoTE was 10.6%.  Group target: RoTE of greater than 10%. | Group RoTE  9.0%  2022: 10.4%  2021: 13.1% |

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|  |  |  |  |  |  |  |  |  |  |  |
| Key performance indicators | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Definition | Why is it important and how the Group performed |  |
| Total operating expenses | Barclays views total operating expenses as a key strategic  area for banks; those who actively manage costs and  control them effectively will gain a strong competitive  advantage.  Group operating expenses increased to £16.9bn (2022:  £16.7bn) reflecting £0.9bn of structural cost actions in  Q423,bringing total structural cost actions for FY23 to  £1.0bn (2022: £0.2bn), business growth and investments in  resilience and controls partially offset by lower litigation and  conduct charges. The prior year included £1.0bn of litigation  and conduct charges related to the Over-issuance of  Securities. | Total operating expenses  £16.9bn  2022: £16.7bn  2021: £14.7bn |
| Cost: income ratio  Total operating expenses divided by total  income. | This is a measure management uses to assess the  productivity of the business operations. Managing the cost  base is a key execution priority for management and  includes a review of all categories of discretionary spending  and an analysis of how we can run the business to ensure  that costs increase at a slower rate than income.  The Group cost: income ratio was 67% (2022: 67%).  Excluding Q423 structural cost actions, Group cost: income  ratio was 63%  driven by  increased income.  Group target: a cost: income ratio below 60%. | Cost: income ratio  67%  2022: 67%  2021: 67% |

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| Key performance indicators (continued) | | | | | | | | | | |

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| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  | 2023 | 2022 | 2021 | 2020 | 2019 |
| For the year ended 31 December | £m | £m | £m | £m | £m |
| Interest income | 35,075 | 19,096 | 11,240 | 11,892 | 15,456 |
| Interest expense | (22,366) | (8,524) | (3,167) | (3,770) | (6,049) |
| Net interest income | 12,709 | 10,572 | 8,073 | 8,122 | 9,407 |
| Fee and commission income | 10,121 | 9,637 | 9,880 | 8,641 | 9,122 |
| Fee and commission expense | (3,592) | (3,038) | (2,206) | (2,070) | (2,362) |
| Net fee and commission income | 6,529 | 6,599 | 7,674 | 6,571 | 6,760 |
| Other income | 6,140 | 7,785 | 6,193 | 7,073 | 5,465 |
| Total income | 25,378 | 24,956 | 21,940 | 21,766 | 21,632 |
|  |  |  |  |  |  |
| Operating costs | (16,714) | (14,957) | (14,092) | (13,434) | (13,359) |
| UK bank levy | (180) | (176) | (170) | (299) | (226) |
| Litigation and conduct | (37) | (1,597) | (397) | (153) | (1,849) |
| Total operating expenses | (16,931) | (16,730) | (14,659) | (13,886) | (15,434) |
|  |  |  |  |  |  |
| Other net income | (9) | 6 | 260 | 23 | 71 |
| Profit before impairment | 8,438 | 8,232 | 7,541 | 7,903 | 6,269 |
| Credit impairment (charges)/releases | (1,881) | (1,220) | 653 | (4,838) | (1,912) |
| Profit before tax | 6,557 | 7,012 | 8,194 | 3,065 | 4,357 |
| Tax charge | (1,234) | (1,039) | (1,138) | (604) | (1,003) |
| Profit after tax | 5,323 | 5,973 | 7,056 | 2,461 | 3,354 |
| Non-controlling interests | (64) | (45) | (47) | (78) | (80) |
| Other equity instrument holders | (985) | (905) | (804) | (857) | (813) |
| Attributable profit | 4,274 | 5,023 | 6,205 | 1,526 | 2,461 |
|  |  |  |  |  |  |
| Selected financial statistics |  |  |  |  |  |
| Basic earnings per share | 27.7p | 30.8p | 36.5p | 8.8p | 14.3p |
| Diluted earnings per share | 26.9p | 29.8p | 35.6p | 8.6p | 14.1p |
| Return on average tangible shareholders’ equity | 9.0% | 10.4% | 13.1% | 3.2% | 5.3% |
| Cost: income ratio | 67% | 67% | 67% | 64% | 71% |

The financial information above is extracted from the published accounts. This information should be read together with the

information included in the accompanying consolidated financial statements.

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|  |  |  |  |  |  |  |  |  |  |  |
| Consolidated summary income statement | | | | | | | | | | |

2023 compared to 2022

Barclays delivered a profit before tax of £6,557m (2022: £7,012m), RoTE of 9.0% (2022: 10.4%) and EPS of 27.7p (2022: 30.8p).

Group income increased 2% to £25,378m primarily driven by the net benefit from the higher interest rate environment, including

continued structural hedge income, and higher balances in US cards, partially offset by the non-repeat of the prior year income from

hedging arrangements related to the Over-issuance of Securities and lower income in Global Markets and Investment Banking,

Group total operating expenses increased to £16,931m (2022: £16,730m).

Group operating expenses excluding litigation and conduct charges increased to £16,894m (2022: £15,133m) driven by:

• £927m of structural cost actions1  in Q423 supporting the Group’s structural transformation and updated strategic priorities,

bringing total structural cost actions for FY23 to £1,046m (2022: £151m)

• the impact of business growth and the Kensington Mortgage Company (KMC) acquisition in Barclays UK, as well as investments in

resilience and controls;

• the impact of inflation on the Group was more than offset by efficiency savings.

Litigation and conduct charges decreased to £37m (2022: £1,597m). Prior year charges included £966m of costs related to the Over-

issuance of Securities, £282m of customer remediation costs relating to legacy loan portfolios in CC&P and £165m related to the

Devices Settlements2.

Credit impairment charges were £1,881m (2022: £1,220m), driven by higher delinquencies in US cards, which was anticipated and led to

higher coverage ratios.  Total coverage ratio remains strong at 1.4% (December 2022: 1.4%).

The effective tax rate (ETR) was 18.8% (2022: 14.8%). The 2023 ETR includes tax relief on payments made under Additional Tier 1

(AT1) instruments and on holdings of inflation-linked government bonds.

Attributable profit was £4,274m (2022: £5,023m).

Notes

1 To help drive future returns, Barclays has taken £0.9bn of structural cost actions in Q423. Structural cost actions include initiatives across people, property and infrastructure.

2 Refers to the settlements with the SEC and Commodity Futures Trading Commission (CFTC) in connection with their investigations of the use of unauthorised devices for business

communications.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 377 |
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| Income statement commentary | | | | | | | | | | |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  | 2023 | 2022 | 2021 | 2020 | 2019 |
| As at 31 December | £m | £m | £m | £m | £m |
| Assets |  |  |  |  |  |
| Cash and balances at central banks | 224,634 | 256,351 | 238,574 | 191,127 | 150,258 |
| Cash collateral and settlement balances | 108,889 | 112,597 | 92,542 | 101,367 | 83,256 |
| Debt securities at amortised cost | 56,749 | 45,487 | 31,831 | 23,805 | 17,752 |
| Loans and advances at amortised cost to banks | 9,459 | 10,015 | 9,698 | 8,900 | 9,624 |
| Loans and advances at amortised cost to customers | 333,288 | 343,277 | 319,922 | 309,927 | 311,739 |
| Reverse repurchase agreements and other similar secured  lending at amortised cost | 2,594 | 776 | 3,227 | 9,031 | 3,379 |
| Trading portfolio assets | 174,605 | 133,813 | 147,035 | 127,950 | 114,195 |
| Financial assets at fair value through the income statement | 206,651 | 213,568 | 191,972 | 175,151 | 133,086 |
| Derivative financial instruments | 256,836 | 302,380 | 262,572 | 302,446 | 229,236 |
| Financial assets at fair value through other comprehensive  income | 71,836 | 65,062 | 61,753 | 78,688 | 65,750 |
| Other assets | 31,946 | 30,373 | 25,159 | 21,122 | 21,954 |
| Total assets | 1,477,487 | 1,513,699 | 1,384,285 | 1,349,514 | 1,140,229 |
| Liabilities |  |  |  |  |  |
| Deposits at amortised cost from banks | 14,472 | 19,979 | 17,819 | 17,343 | 15,402 |
| Deposits at amortised cost from customers | 524,317 | 525,803 | 501,614 | 463,693 | 400,385 |
| Cash collateral and settlement balances | 94,084 | 96,927 | 79,371 | 85,423 | 67,341 |
| Repurchase agreements and other similar secured borrowings at  amortised cost | 41,601 | 27,052 | 28,352 | 14,174 | 14,517 |
| Debt securities in issue | 96,825 | 112,881 | 98,867 | 75,796 | 76,369 |
| Subordinated liabilities | 10,494 | 11,423 | 12,759 | 16,341 | 18,156 |
| Trading portfolio liabilities | 58,669 | 72,924 | 54,169 | 47,405 | 36,916 |
| Financial liabilities designated at fair value | 297,539 | 271,637 | 250,960 | 249,765 | 204,326 |
| Derivative financial instruments | 250,044 | 289,620 | 256,883 | 300,775 | 229,204 |
| Other liabilities | 17,578 | 16,193 | 13,450 | 11,917 | 11,953 |
| Total liabilities | 1,405,623 | 1,444,439 | 1,314,244 | 1,282,632 | 1,074,569 |
| Equity |  |  |  |  |  |
| Called up share capital and share premium | 4,288 | 4,373 | 4,536 | 4,637 | 4,594 |
| Other equity instruments | 13,259 | 13,284 | 12,259 | 11,172 | 10,871 |
| Other reserves | (77) | (2,192) | 1,770 | 4,461 | 4,760 |
| Retained earnings | 53,734 | 52,827 | 50,487 | 45,527 | 44,204 |
| Total equity excluding non-controlling interests | 71,204 | 68,292 | 69,052 | 65,797 | 64,429 |
| Non-controlling interests | 660 | 968 | 989 | 1,085 | 1,231 |
| Total equity | 71,864 | 69,260 | 70,041 | 66,882 | 65,660 |
| Total liabilities and equity | 1,477,487 | 1,513,699 | 1,384,285 | 1,349,514 | 1,140,229 |
|  |  |  |  |  |  |
| Net asset value per ordinary share | 382p | 347p | 339p | 315p | 309p |
| Tangible net asset value per share | 331p | 295p | 291p | 269p | 262p |
| Number of ordinary shares of Barclays PLC (in millions) | 15,155 | 15,871 | 16,752 | 17,359 | 17,322 |
|  |  |  |  |  |  |
| Year-end USD exchange rate | 1.28 | 1.20 | 1.35 | 1.37 | 1.32 |
| Year-end EUR exchange rate | 1.15 | 1.13 | 1.19 | 1.11 | 1.18 |

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 378 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Consolidated summary balance sheet | | | | | | | | | | |

Total assets

Total assets decreased £36.2bn to £1,477.5bn.

Cash and balances at central banks decreased by £31.7bn to £224.6bn  driven by lower customer deposits in Barclays UK reflecting the

broader market trends.

Debt securities at amortised cost increased by £11.3bn to £56.7bn and Financial assets at fair value through other comprehensive

income increased £6.8bn to £71.8bn driven by increased investment in debt securities in Barclays International.

Loans and advances at amortised cost  to banks and customers decreased £10.5bn to £342.7bn driven by loan repayments across

Barclays International and Barclays UK.

Trading portfolio assets increased £40.8bn to £174.6bn driven by an increase in debt and equity securities as we facilitate client demand

in Barclays International.

Derivative financial instrument assets decreased £45.5bn to £256.8bn, driven by lower market volatility and a decrease in the forward

interest rates. Cash collateral and settlement balances decreased by £3.7bn to £108.9bn.

Financial assets at fair value through the income statement decreased £6.9bn to £206.7bn driven by increased secured lending being

more than offset by trade optimisations.

Total liabilities

Total liabilities decreased £38.8bn to £1,405.6bn.

Deposits  at amortised cost to banks and customers decreased £7.0bn to £538.8bn driven by a reduction in customer deposits

reflecting broader market trends in Barclays UK, partially offset by an increase in short-term money market deposits and growth in

customer deposits in Barclays International.

Repurchase agreements and other similar secured borrowing at amortised cost increased £14.5bn to £41.6bn driven by increased

secured borrowing.

Debt securities in issue decreased £16.1bn to £96.8bn driven by maturities.

Derivative financial instrument liabilities decreased £39.6bn to £250.0bn driven by lower market volatility. Cash collateral and settlement

balances decreased by £2.8bn to £94.1bn.

Trading portfolio liabilities decreased £14.3bn to £58.7bn driven by decreases in equity securities as clients repositioned their demand.

Financial liabilities designated at fair value increased £25.9bn to £297.5bn driven by increased repurchase agreements and prime

brokerage deposits.

Total shareholders’ equity

Total shareholders’ equity increased £2.6bn to £71.9bn.

Other equity instruments remained at £13.3bn as the issuance of three AT1 instruments (£1.50bn, $1.8bn and SGD400m) was offset

by two redemptions (£1.3bn and $ 2.5bn).  AT1 securities are perpetual subordinated contingent convertible securities structured to

qualify as AT1 instruments under prevailing capital rules applicable as at the relevant issue date.

Other reserves increased by £2.1bn, mainly due to an increase in the cash flow hedging reserve of £3.5bn to £3.7bn debit, as a result of

fair value movements on interest rate swaps held for hedging purposes due to an decrease in major interest rate curves.  This was

partially offset by an decrease in the currency translation reserve of £1.1bn to £3.7bn, driven by the appreciation of GBP against USD.

Retained earnings increased £0.9bn to £53.7bn, mainly due to profits of £4.3bn, offset by share repurchases of £1.3bn and dividends of

£1.2bn.

Tangible net asset value per share  increased to 331p (December 2022: 295p) including: EPS of 27.7p, positive cash flow hedge reserve

movements of 22p, and 8p from the reduction in share count following share buybacks of £1.25bn completed in 2023. This was partially

offset by an 8p reduction from dividends paid during 2023 and net negative other reserve movements.

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| Balance sheet commentary | | | | | | | | | | |

Barclays UK

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Income statement information |  |  |  |
| Net interest income | 6,431 | 5,893 | 5,202 |
| Net fee, commission and other income | 1,156 | 1,366 | 1,334 |
| Total income | 7,587 | 7,259 | 6,536 |
| Operating costs | (4,393) | (4,260) | (4,357) |
| UK bank levy | (30) | (26) | (36) |
| Litigation and conduct | 8 | (41) | (37) |
| Total operating expenses | (4,415) | (4,327) | (4,430) |
| Other net income | — | — | — |
| Profit before impairment | 3,172 | 2,932 | 2,106 |
| Credit impairment (charges)/releases | (304) | (286) | 365 |
| Profit before tax | 2,868 | 2,646 | 2,471 |
| Attributable profit | 1,962 | 1,877 | 1,756 |
|  |  |  |  |
| Balance sheet information |  |  |  |
| Loans and advances to customers at amortised cost | £202.8bn | £205.1bn | £208.8bn |
| Total assets | £293.1bn | £313.2bn | £321.2bn |
| Customer deposits at amortised cost | £241.1bn | £258.0bn | £260.6bn |
| Loan: deposit ratio | 92% | 87% | 85% |
| Risk weighted assets | £73.5bn | £73.1bn | £72.3bn |
| Period end allocated tangible equity | £10.2bn | £10.1bn | £10.0bn |
|  |  |  |  |
| Key facts |  |  |  |
| UK mortgage balances | £160.9bn | £162.2bn | £158.1bn |
| Mortgage gross lending flow | £22.7bn | £30.3bn | £33.9bn |
| Average LTV of mortgage portfolio1 | 54% | 50% | 51% |
| Average LTV of new mortgage lending1 | 63% | 68% | 70% |
| Number of branches | 306 | 481 | 666 |
| Mobile banking active customers | 11.0m | 10.5m | 9.7m |
| 30 day arrears rate - Barclaycard Consumer UK | 0.9% | 0.9% | 1.0% |
| Number of employees (full time equivalent) | 6,800 | 6,200 | 7,100 |
|  |  |  |  |
| Performance measures |  |  |  |
| Return on average allocated tangible equity | 19.2% | 18.7% | 17.6% |
| Average allocated tangible equity | £10.2bn | £10.0bn | £10.0bn |
| Cost: income ratio | 58% | 60% | 68% |
| Loan loss rate (bps) | 14 | 13 | (16) |
| Net interest margin | 3.13% | 2.86% | 2.52% |

Note

1 Average loan to value (LTV) of mortgages is balance weighted and reflects both residential and buy-to-let (BTL) mortgage portfolios within the Home Loans portfolio.

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| Analysis of results by business | | | | | | | | | | |

Analysis of Barclays UK

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Analysis of total income |  |  |  |
| Personal Banking | 4,729 | 4,540 | 3,883 |
| Barclaycard Consumer UK | 964 | 1,093 | 1,250 |
| Business Banking | 1,894 | 1,626 | 1,403 |
| Total income | 7,587 | 7,259 | 6,536 |
|  |  |  |  |
| Analysis of credit impairment (charges)/releases |  |  |  |
| Personal Banking | (170) | (167) | 28 |
| Barclaycard Consumer UK | (162) | 30 | 404 |
| Business Banking | 28 | (149) | (67) |
| Total credit impairment (charges)/releases | (304) | (286) | 365 |
|  |  |  |  |
| Analysis of loans and advances to customers at amortised cost |  |  |  |
| Personal Banking | £170.1bn | £169.7bn | £165.4bn |
| Barclaycard Consumer UK | £9.7bn | £9.2bn | £8.7bn |
| Business Banking | £23.0bn | £26.2bn | £34.7bn |
| Total loans and advances to customers at amortised cost | £202.8bn | £205.1bn | £208.8bn |
|  |  |  |  |
| Analysis of customer deposits at amortised cost |  |  |  |
| Personal Banking | £185.4bn | £195.6bn | £196.4bn |
| Barclaycard Consumer UK | — | — | — |
| Business Banking | £55.7bn | £62.4bn | £64.2bn |
| Total customer deposits at amortised cost | £241.1bn | £258.0bn | £260.6bn |

2023 compared to 2022

Profit before tax increased 8% to £2,868m with a RoTE of 19.2% (2022: 18.7%).

Total income increased 5% to £7,587m. Net interest income  increased 9% to £6,431m with a net interest margin of 3.13% (2022:

2.86%), as higher interest rates and associated structural hedge benefit outweighed mortgage margin pressure and adverse deposit

dynamics reflecting wider market trends. Net fee, commission and other income decreased 15% to £1,156m including the impact of

the transfer of WM&I to CC&P.

• Personal Banking income increased 4% to £4,729m, driven by higher interest rates, partially offset by mortgage margin compression

and movements in deposit volumes and mix resulting from cost of living pressures and customers searching for yield.

• Barclaycard Consumer UK income decreased 12% to £964m as higher customer spend volumes were more than offset by lower

interest earning lending balances following repayments and ongoing prudent risk management.

• Business Banking income increased 16% to £1,894m driven by higher interest rates, partially offset by lower government scheme

lending as repayments continue and lower deposit volumes.

Total operating expenses increased 2% to £4,415m, including £168m impact from Q423 structural cost actions. Excluding the impact

of Q423 structural cost actions, operating expenses decreased 2%, driven by the transfer of WM&I to CC&P partially offset by the

impact of inflation and the acquisition of KMC. Ongoing efficiency savings continue to be reinvested, including in our transformation

programme to support sustainable improvement to the cost: income ratio over the longer term.

Credit impairment charges increased to £304m (2022: £286m), consistent with low delinquencies in UK cards and a high quality

mortgage lending portfolio. UK cards 30 and 90 day arrears remained low at 0.9% (Q422: 0.9%) and 0.2% (Q422: 0.2%) respectively.

The UK cards total coverage ratio was 6.8% (December 2022: 7.6%).

Loans and advances to customers at amortised cost decreased by 1% to £202.8bn (December 2022: £205.1bn), primarily reflecting

continued repayment of government scheme lending in Business Banking, subdued mortgage lending amid lower market demand,

partially offset by the acquisition of KMC.

Customer deposits at amortised cost decreased 7% to £241.1bn (December 2022: £258.0bn). Primarily driven by reduced current

account balances in Personal and Business Banking, reflecting broader market trends. The loan: deposit ratio increased to 92%

(December 2022: 87%).

RWAs increased to £73.5bn (December 2022: £73.1bn), primarily due to the acquisition of KMC, broadly offset by reduction across

lending portfolios.

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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Analysis of results by business (continued) | | | | | | | | | | |

Barclays International

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Income statement information |  |  |  |
| Net interest income | 6,197 | 4,927 | 3,263 |
| Net trading income | 5,878 | 7,709 | 5,693 |
| Net fee, commission and other income | 5,843 | 5,231 | 6,709 |
| Total income | 17,918 | 17,867 | 15,665 |
| Operating costs | (11,578) | (10,361) | (9,076) |
| UK bank levy | (136) | (133) | (134) |
| Litigation and conduct | (47) | (1,503) | (345) |
| Total operating expenses | (11,761) | (11,997) | (9,555) |
| Other net (expenses)/income | (2) | 28 | 40 |
| Profit before impairment | 6,155 | 5,898 | 6,150 |
| Credit impairment (charges)/releases | (1,548) | (933) | 288 |
| Profit before tax | 4,607 | 4,965 | 6,438 |
| Attributable profit | 3,025 | 3,844 | 4,647 |
|  |  |  |  |
| Balance sheet information |  |  |  |
| Loans and advances to customers at amortised cost | £126.8bn | £133.7bn | £106.4bn |
| Loans and advances to banks at amortised cost | £8.4bn | £8.7bn | £8.4bn |
| Debt securities at amortised cost | £39.0bn | £27.2bn | £19.0bn |
| Loans and advances at amortised cost | £174.2bn | £169.6bn | £133.8bn |
| Trading portfolio assets | £174.6bn | £133.8bn | £146.9bn |
| Derivative financial instrument assets | £255.2bn | £301.7bn | £261.5bn |
| Financial assets at fair value through the income statement | £203.7bn | £210.5bn | £188.2bn |
| Cash collateral and settlement balances | £103.6bn | £107.7bn | £88.1bn |
| Other assets | £254.8bn | £258.0bn | £225.6bn |
| Total assets | £1,166.1bn | £1,181.3bn | £1,044.1bn |
| Deposits at amortised cost | £297.7bn | £287.6bn | £258.8bn |
| Derivative financial instrument liabilities | £249.8bn | £288.9bn | £256.4bn |
| Loan: deposit ratio | 58% | 59% | 52% |
| Risk weighted assets | £259.1bn | £254.8bn | £230.9bn |
| Period end allocated tangible equity | £37.6bn | £36.8bn | £33.2bn |
|  |  |  |  |
| Key facts |  |  |  |
| Number of employees (full time equivalent) | 12,400 | 10,900 | 10,400 |
|  |  |  |  |
| Performance measures |  |  |  |
| Return on average allocated tangible equity | 8.2% | 10.2% | 14.4% |
| Average allocated tangible equity | £37.0bn | £37.6bn | £32.4bn |
| Cost: income ratio | 66% | 67% | 61% |
| Loan loss rate (bps) | 87 | 54 | (21) |
| Net interest margin | 5.78% | 5.02% | 4.01% |

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 382 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Analysis of results by business (continued) | | | | | | | | | | |

Analysis of Barclays International

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
| Corporate and Investment Bank | £m | £m | £m |
| Income statement information |  |  |  |
| Net interest income | 2,551 | 1,949 | 1,351 |
| Net trading income | 6,056 | 7,733 | 5,652 |
| Net fee, commission and other income | 4,003 | 3,686 | 5,331 |
| Total income | 12,610 | 13,368 | 12,334 |
| Operating costs | (8,335) | (7,630) | (6,818) |
| UK bank levy | (129) | (126) | (128) |
| Litigation and conduct | 6 | (1,189) | (237) |
| Total operating expenses | (8,458) | (8,945) | (7,183) |
| Other net (expenses)/income | (3) | 2 | 2 |
| Profit before impairment | 4,149 | 4,425 | 5,153 |
| Credit impairment (charges)/releases | (23) | (119) | 473 |
| Profit before tax | 4,126 | 4,306 | 5,626 |
| Attributable profit | 2,667 | 3,364 | 4,032 |
|  |  |  |  |
| Balance sheet information |  |  |  |
| Loans and advances to customers at amortised cost | £87.8bn | £90.5bn | £73.4bn |
| Loans and advances to banks at amortised cost | £7.4bn | £8.1bn | £7.6bn |
| Debt securities at amortised cost | £38.9bn | £27.2bn | £19.0bn |
| Loans and advances at amortised cost | £134.1bn | £125.8bn | £100.0bn |
| Trading portfolio assets | £174.5bn | £133.7bn | £146.7bn |
| Derivative financial instrument assets | £255.1bn | £301.6bn | £261.5bn |
| Financial assets at fair value through the income statement | £203.6bn | £210.5bn | £188.1bn |
| Cash collateral and settlement balances | £102.9bn | £106.9bn | £87.2bn |
| Other assets | £205.4bn | £222.6bn | £195.8bn |
| Total assets | £1,075.6bn | £1,101.1bn | £979.3bn |
| Deposits at amortised cost | £217.7bn | £205.8bn | £189.4bn |
| Derivative financial instrument liabilities | £249.7bn | £288.9bn | £256.4bn |
| Risk weighted assets | £216.8bn | £215.9bn | £200.7bn |
|  |  |  |  |
| Performance measures |  |  |  |
| Return on average allocated tangible equity | 8.4% | 10.2% | 14.3% |
| Average allocated tangible equity | £31.7bn | £32.8bn | £28.3bn |
| Cost: income ratio | 67% | 67% | 58% |
| Loan loss rate (bps) | 2 | 9 | (47) |
|  |  |  |  |
| Analysis of total income |  |  |  |
| FICC | 4,845 | 5,695 | 3,448 |
| Equities | 2,373 | 3,149 | 2,967 |
| Global Markets | 7,218 | 8,844 | 6,415 |
| Advisory | 593 | 768 | 921 |
| Equity capital markets | 219 | 166 | 813 |
| Debt capital markets | 1,148 | 1,281 | 1,925 |
| Investment Banking fees | 1,960 | 2,215 | 3,659 |
| Corporate lending | 475 | (231) | 588 |
| Transaction banking | 2,957 | 2,540 | 1,672 |
| Corporate | 3,432 | 2,309 | 2,260 |
| Total income | 12,610 | 13,368 | 12,334 |

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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Analysis of results by business (continued) | | | | | | | | | | |

Analysis of Barclays International continued

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
| Consumer, Cards and Payments | £m | £m | £m |
| Income statement information |  |  |  |
| Net interest income | 3,646 | 2,979 | 1,912 |
| Net fee, commission, trading and other income | 1,662 | 1,520 | 1,419 |
| Total income | 5,308 | 4,499 | 3,331 |
| Operating costs | (3,243) | (2,731) | (2,258) |
| UK bank levy | (7) | (7) | (6) |
| Litigation and conduct | (53) | (314) | (108) |
| Total operating expenses | (3,303) | (3,052) | (2,372) |
| Other net income | 1 | 26 | 38 |
| Profit before impairment | 2,006 | 1,473 | 997 |
| Credit impairment charges | (1,525) | (814) | (185) |
| Profit before tax | 481 | 659 | 812 |
| Attributable profit | 358 | 480 | 615 |
|  |  |  |  |
| Balance sheet information |  |  |  |
| Loans and advances to customers at amortised cost | £39.0bn | £43.2bn | £33.0bn |
| Total assets | £90.5bn | £80.2bn | £64.8bn |
| Deposits at amortised cost | £80.0bn | £81.8bn | £69.4bn |
| Risk weighted assets | £42.3bn | £38.9bn | £30.2bn |
|  |  |  |  |
| Key facts |  |  |  |
| US cards 30 day arrears rate | 2.9% | 2.2% | 1.6% |
| US cards customer FICO score distribution |  |  |  |
| <660 | 12% | 11% | 10% |
| >660 | 88% | 89% | 90% |
| Total number of payments clients | 402k | 395k | 380k |
| Value of payments processed1 | £324bn | £307bn | £277bn |
|  |  |  |  |
| Performance measures |  |  |  |
| Return on average allocated tangible equity | 6.7% | 10.0% | 15.0% |
| Average allocated tangible equity | £5.3bn | £4.8bn | £4.1bn |
| Cost: income ratio | 62% | 68% | 71% |
| Loan loss rate (bps) | 354 | 175 | 51 |
|  |  |  |  |
| Analysis of total income |  |  |  |
| International Cards and Consumer Bank | 3,569 | 2,913 | 2,092 |
| Private Bank | 1,190 | 1,014 | 781 |
| Payments | 549 | 572 | 458 |
| Total income | 5,308 | 4,499 | 3,331 |

Note

1 Includes £311bn (2022: £296bn; 2021: £270bn) of merchant acquiring payments.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 384 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Analysis of results by business (continued) | | | | | | | | | | |

2023 compared to 2022

Barclays International RoTE was 8.2% (2022: 10.2%) with a profit before tax of £4,607m (2022: £4,965m) including £306m (CIB: £188m,

CC&P: £118m) of Q423 structural cost actions. CIB delivered a RoTE of 8.4% (2022: 10.2%) and CC&P 6.7% (2022: 10.0%)

• Total income was broadly flat at £17,918m, prior year included a £292m income impact from hedging arrangements related to the

Over-issuance of securities

• Total operating expenses decreased 2% to £11,761m including £306m of structural cost actions in Q423. Prior year included £966m

of litigation and conduct charges relating to the Over-issuance of securities

Excluding the impact of Q423 structural cost actions and the Over-issuance of Securities in the prior year1:

Total income increased to £17,918m (2022: £17,575m)

CIB income decreased 4% to £12,610m (2022: £13,076m)

• Global Markets income decreased 16% to £7,218m against a record prior year comparative2. FICC income decreased 15% to

£4,845m, reflecting lower market volatility and client activity. Equities income decreased 17% to£2,373m, driven by a decline in

derivatives income reflecting less volatile equity market conditions.

• Investment Banking fees decreased 12% to £1,960m due to the reduced fee pool across the industry3. Advisory decreased 23% and

Debt capital markets decreased 10%, while Equity capital markets increased 32%

• Within Corporate, Transaction banking income increased 16% to £2,957m driven by improved deposit margins in the higher interest

rate environment with stable deposit balances. Corporate lending income increased to £475m (2022: £231m loss) mainly driven by

lower costs of hedging and lower fair value losses on leverage finance lending net of mark to market gains on related hedges.

CC&P income increased 18% to £5,308m.

• International Cards and Consumer Bank income increased 23% to £3,569m reflecting higher cards balances and improved margins,

including the Gap Inc. portfolio acquisition in Q222.

• Private Bank income increased 17% to £1,190m, due to the transfer of WM&I from Barclays UK, client balance growth and improved

deposits margin in the higher rate environment.

• Payments income decreased 4% to £549m driven by margin compression.

Total operating expenses  increased 4%  to £11,455m

• CIB total operating expenses  increased   4% to £8,270m, reflecting investment in talent and technology, and the impact of inflation,

partially offset by the non-repeat of prior year litigation and conduct charges mainly relating to Device Settlements4 and efficiency

savings

• CC&P total operating expenses increased 4% to £3,185m, driven by higher investment spend to support growth, mainly in marketing

and partnership costs, the transfer of WM&I from Barclays UK, and the impact of inflation, partially offset by the non-repeat of prior

year litigation and conduct charges mainly relating to customer remediation costs and efficiency savings

Credit impairment charges were £1,548m (2022: £933m).

• CIB credit impairment charges were £23m (2022: £119m), driven by single name charges, partially offset by the benefit of credit

protection.

• CC&P credit impairment charges increased to £1,525m (2022: £814m), driven by higher delinquencies in US cards, which was

anticipated and led to higher coverage ratios. 30 and 90 day arrears at 2.9% (Q422: 2.2%) and 1.5% (Q422: 1.2%) respectively. The

US cards total coverage ratio was 10.2% (December 2022: 8.1%).

Loans and advances at amortised cost increased £4.6bn to £174.2bn driven by increased investment in debt securities in Treasury. In

addition, there has been balance growth in CC&P which was offset by net loan repayments in CIB and transfer to held for sale of the

German consumer finance business.

Trading portfolio assets increased £40.8bn to £174.6bn driven by an increase in debt and equity securities as we facilitate client demand

in Global Markets.

Derivative assets and liabilities decreased £46.5bn and £39.1bn to £255.2bn and £249.8bn respectively reflecting lower market volatility

and a decrease in the forward interest rates.

Financial assets at fair value through the income statement decreased £6.8bn to £203.7bn driven by increased secured lending which

was more than offset by trade optimisations.

Deposits at amortised cost increased £10.1bn to £297.7bn driven by increased deposits in CIB.

RWAs increased to £259.1bn (December 2022: £254.8bn) driven by higher CC&P RWAs.

Notes

1 The Over-issuance of Securities in the prior year impacted Equities within Global markets, CIB and Barclays International only.

2 Period covering 2014-2023. Pre 2014 data was not restated following re-segmentation in 2016.

3 Data source: Dealogic for the period covering 1 January to 31 December 2023.

4 Refers to the settlements with the SEC and CFTC in connection with their investigations of the use of unauthorised devices for business communications.

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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Analysis of results by business (continued) | | | | | | | | | | |

Head Office

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Income statement information |  |  |  |
| Net interest income | 81 | (248) | (392) |
| Net fee, commission and other income | (208) | 78 | 131 |
| Total income | (127) | (170) | (261) |
| Operating costs | (743) | (336) | (659) |
| UK bank levy | (14) | (17) | — |
| Litigation and conduct | 2 | (53) | (15) |
| Total operating expenses | (755) | (406) | (674) |
| Other net (expenses)/income | (7) | (22) | 220 |
| Loss before impairment | (889) | (598) | (715) |
| Credit impairment charges | (29) | (1) | — |
| Loss before tax | (918) | (599) | (715) |
| Attributable loss | (713) | (698) | (198) |
|  |  |  |  |
| Balance sheet information |  |  |  |
| Total assets | £18.3bn | £19.2bn | £19.0bn |
| Risk weighted assets | £10.2bn | £8.6bn | £11.0bn |
| Period end allocated tangible equity | £2.3bn | £(0.2)bn | £5.5bn |
|  |  |  |  |
| Key facts |  |  |  |
| Number of employees (full time equivalent)1, 2 | 73,200 | 70,300 | 64,100 |
|  |  |  |  |
| Performance measures |  |  |  |
| Average allocated tangible equity | £0.2bn | £0.7bn | £5.0bn |

Notes

1 Head Office includes employees in Barclays Execution Services.

2 Barclays Execution Services Employees are reported within the Head Office Segment. Barclays UK transformed its business in 2021 and consolidated all Customer Care employees,

who directly serve customers, into Barclays Execution Services to improve customer service and experience. Costs are recharged, while FTEs are reported within Head Office, as at 31

December 2021 10,700 FTEs were impacted by the move from Barclays UK to Head Office.

2023 compared to 2022

Loss before tax was £918m (2022: £599m), including £453m Q423 structural cost actions.

Total income was an expense of £127m (2022: £170m) primarily reflecting hedge accounting and treasury items.

Total operating expenses increased to £755m (2022: £406m) primarily driven by £453m of Q423 structural cost actions partially offset

by lower litigation and conduct charges.

• Head Office structural cost actions principally include the software intangibles impairment related to the merchant acquiring

business (c.£260m), and the Canary Wharf office lease exit (c.£140m).

RWAs were £10.2bn (December 2022: £8.6bn) primarily driven by methodology and policy updates, and increases in non-customer

assets.

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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Analysis of results by business (continued) | | | | | | | | | | |

The Group’s management believes that the non-IFRS performance measures included in this document provide valuable information

to the readers of the financial statements as they enable the reader to identify a more consistent basis for comparing the businesses’

performance between financial periods, and provide more detail concerning the elements of performance which the managers of these

businesses are most directly able to influence or are relevant for an assessment of the Group.

They also reflect an important aspect of the way in which operating targets are defined and performance is monitored by management.

However, any non-IFRS performance measures in this document are not a substitute for IFRS measures and readers should consider

the IFRS measures as well.

Non-IFRS performance measures glossary

|  |  |
| --- | --- |
|  |  |
| Measure | Definition |
| Loan: deposit ratio | Total loans and advances at amortised cost divided by total deposits at amortised cost. The components  of the calculation have been included on page  [343](#i65b1649a343d4e6981be1817c21942f9_15989) . |
| Attributable profit | Profit after tax attributable to ordinary shareholders of the parent. |
| Period end tangible equity refers to: | |
| Period end tangible  shareholders' equity (for  Barclays Group) | Shareholders' equity attributable to ordinary shareholders of the parent, adjusted for the deduction of  intangible assets and goodwill. |
| Period end allocated tangible  equity (for businesses) | Allocated tangible equity is calculated as 13.5%  (2022:  13.5% , 2021: 13.5%) of RWAs for each business,  adjusted for capital deductions, excluding goodwill and intangible assets, reflecting the assumptions the  Barclays Group uses for capital planning purposes. Head Office allocated tangible equity represents the  difference between the Barclays Group’s tangible shareholders’ equity and the amounts allocated to  businesses. |
| Average tangible equity refers to: | |
| Average tangible shareholders’  equity (for Barclays Group) | Calculated as the average of the previous month’s period end tangible shareholders' equity and the  current month’s period end tangible shareholders' equity. The average tangible shareholders’ equity for  the period is the average of the monthly averages within that period. |
| Average allocated tangible  equity (for businesses) | Calculated as the average of the previous month’s period end allocated tangible equity and the current  month’s period end allocated tangible equity. The average allocated tangible equity for the period is the  average of the monthly averages within that period. |
| Return on tangible equity (RoTE) refers to: | |
| Return on average tangible  shareholders’ equity (for  Barclays Group) | Group attributable profit, as a proportion of average tangible shareholders’ equity. The components of the  calculation have been included on pages [389](#i89aed622f2dc484da784eb1678335429_1502) . |
| Return on average allocated  tangible equity (for businesses) | Business attributable profit, as a proportion of that business's average allocated tangible equity. The  components of the calculation have been included on page  [389](#i89aed622f2dc484da784eb1678335429_1502) . |
| Operating expenses excluding  litigation and conduct | A measure of total operating expenses excluding litigation and conduct charges. |
| Operating costs | A measure of total operating expenses excluding litigation and conduct charges and UK bank levy. |
| Cost: income ratio | Total operating expenses divided by total income. |
| Loan loss rate | Quoted in basis points and represents total impairment charges divided by total gross loans and advances  held at amortised cost at the balance sheet date. |
| Net interest margin | Net interest income divided by the sum of average customer assets. The components of the calculation  have been included on page  [388](#i89aed622f2dc484da784eb1678335429_1505). |
| Tangible net asset value per  share | Calculated by dividing shareholders’ equity, excluding non-controlling interests and other equity  instruments, less goodwill and intangible assets, by the number of issued ordinary shares. The  components of the calculation have been included on page [393](#if8d9fdc0ce9945ddb066fd1f4b5d0f0d_362). |
| Profit before impairment | Calculated by excluding credit impairment charges or releases from profit before tax. |
| Structural cost actions | Cost actions taken to improve future financial performance. |
| Performance measures  excluding the impact of Q423  structural cost actions | Calculated by excluding the impact of Q423 structural cost actions from performance measures. The  components of the calculations for Barclays Group and businesses have been included on page  [390](#i0c3b612a6c5c40828e53fffbfc70d095_927) and  page [392](#if8d9fdc0ce9945ddb066fd1f4b5d0f0d_371) respectively. |
| Performance measures  excluding the impact of the  Over-issuance of Securities | Calculated by excluding the impact of the Over-issuance of Securities from performance measures. The  components of the calculations for Barclays Group and businesses have been included on pages  [390](#i0c3b612a6c5c40828e53fffbfc70d095_927) to  [392](#if8d9fdc0ce9945ddb066fd1f4b5d0f0d_371)  respectively. |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 387 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-IFRS performance measures | | | | | | | | | | |

Margins analysis

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
| For the year ended 31 December | 2023 | | | 2022 | | | 2021 | | |
| Net interest  income | Average  customer  assets | Net interest  margin | Net interest  income | Average  customer  assets | Net interest  margin | Net interest  income | Average  customer  assets | Net interest  margin |
| £m | £m | % | £m | £m | % | £m | £m | % |
| Barclays UK | 6,431 | 205,667 | 3.13 | 5,893 | 205,972 | 2.86 | 5,202 | 206,628 | 2.52 |
| Corporate and Investment Bank | 1,991 | 54,600 | 3.65 | 1,796 | 56,008 | 3.21 | 1,238 | 47,725 | 2.59 |
| Consumer, Cards and Payments | 3,646 | 42,910 | 8.50 | 2,979 | 39,193 | 7.60 | 1,911 | 30,805 | 6.21 |
| Barclays International | 5,637 | 97,510 | 5.78 | 4,775 | 95,201 | 5.02 | 3,149 | 78,530 | 4.01 |
| Total Barclays Group | 12,068 | 303,177 | 3.98 | 10,668 | 301,173 | 3.54 | 8,351 | 285,158 | 2.93 |
| Other1 | 641 |  |  | (96) |  |  | (278) |  |  |
| Total Barclays Group net interest income | 12,709 |  |  | 10,572 |  |  | 8,073 |  |  |

Note

1 Other comprises net interest income from Markets within Barclays International and Head Office including hedge accounting.

The Barclays Group NIM has increased  44 bps from 3.54% to  3.98 % in 2023, driven by the higher interest rate environment and

continued structural hedge income momentum across the Group as well as higher balances in CC&P including the Gap Inc. portfolio

acquisition, partially offset by product dynamics in deposits and mortgages.

The Group’s combined product and equity structural hedge notional as at 31 December 2023  was £246 bn (December 2022: £263bn),

with an average duration of close to 2.5 years. Gross structural hedge contributions of £3,623m (2022 : £2,196m) and net structural

hedge contributions of £(8,209)m (2022: £(1,544)m) are included in Group net interest income. Gross structural hedge contributions

represent the absolute interest income earned from the fixed receipts on the swaps in the structural hedge, while the net structural

hedge contributions represent the net interest earned on the difference between the structural hedge rate and prevailing floating rates.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 388 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-IFRS performance measures (continued) | | | | | | | | | | |

Returns

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | For the year ended 31 December 2023 | | | | | |
| Return on average tangible  equity | Barclays UK | Corporate and  Investment Bank | Consumer, Cards  and Payments | Barclays  International | Head Office | Barclays Group |
| £m | £m | £m | £m | £m | £m |
| Attributable profit/(loss) | 1,962 | 2,667 | 358 | 3,025 | (713) | 4,274 |
|  |  |  |  |  |  |  |
| Average equity | £14.0bn | £31.7bn | £6.1bn | £37.8bn | £4.0bn | £55.8bn |
| Average goodwill and intangibles | £(3.8)bn | — | £(0.8)bn | £(0.8)bn | £(3.8)bn | £(8.4)bn |
| Average tangible equity | £10.2bn | £31.7bn | £5.3bn | £37.0bn | £0.2bn | £47.4bn |
|  |  |  |  |  |  |  |
| Return on average tangible equity | 19.2% | 8.4% | 6.7% | 8.2% | n/m | 9.0% |
|  |  |  |  |  |  |  |
| Barclays Group average tangible shareholder's  equity based on a CET1 ratio of 13.5% |  |  |  |  |  | £46.5bn |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | For the year ended 31 December 2022 | | | | | |
| Return on average tangible equity | Barclays UK | Corporate and  Investment Bank | Consumer, Cards  and Payments | Barclays  International | Head Office | Barclays Group |
| £m | £m | £m | £m | £m | £m |
| Attributable profit/(loss) | 1,877 | 3,364 | 480 | 3,844 | (698) | 5,023 |
|  |  |  |  |  |  |  |
| Average equity | £13.6bn | £32.8bn | £5.7bn | £38.5bn | £4.3bn | £56.4bn |
| Average goodwill and intangibles | (£3.6bn) | — | (£0.9bn) | (£0.9bn) | (£3.6bn) | (£8.1bn) |
| Average tangible equity | £10.0bn | £32.8bn | £4.8bn | £37.6bn | £0.7bn | £48.3bn |
|  |  |  |  |  |  |  |
| Return on average tangible equity | 18.7% | 10.2% | 10.0% | 10.2% | n/m | 10.4% |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | For the year ended 31 December 2021 | | | | | |
| Return on average tangible equity | Barclays UK | Corporate and  Investment Bank | Consumer, Cards  and Payments | Barclays  International | Head Office | Barclays Group |
| £m | £m | £m | £m | £m | £m |
| Attributable profit/(loss) | 1,756 | 4,032 | 615 | 4,647 | (198) | 6,205 |
|  |  |  |  |  |  |  |
| Average equity | £13.6bn | £28.3bn | £4.8bn | £33.1bn | £8.7bn | £55.4bn |
| Average goodwill and intangibles | (£3.6bn) | — | (£0.7bn) | (£0.7bn) | (£3.7bn) | (£8.1bn) |
| Average tangible equity | £10.0bn | £28.3bn | £4.1bn | £32.4bn | £5.0bn | £47.3bn |
|  |  |  |  |  |  |  |
| Return on average tangible equity | 17.6% | 14.3% | 15.0% | 14.4% | n/m | 13.1% |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 389 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-IFRS performance measures (continued) | | | | | | | | | | |

Reconciliation of financial results excluding adjusting items 1

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
|  | For the year ended 31 December 2023 | | |  | For the year ended 31 December 2022 | | |  |  |
|  | Statutory | Adjusting  items 1 | Excluding  adjusting  items |  | Statutory | Adjusting  items 1 | Excluding  adjusting  items |  |  |
|  | £m | £m | £m |  | £m | £m | £m |  | % Change |
| Barclays UK | 7,587 | — | 7,587 |  | 7,259 | — | 7,259 |  | 5 |
| Corporate and Investment Bank | 12,610 | — | 12,610 |  | 13,368 | 292 | 13,076 |  | (4) |
| Consumer, Cards and Payments | 5,308 | — | 5,308 |  | 4,499 | — | 4,499 |  | 18 |
| Barclays International | 17,918 | — | 17,918 |  | 17,867 | 292 | 17,575 |  | 2 |
| Head Office | (127) | — | (127) |  | (170) | — | (170) |  | 25 |
| Total income | 25,378 | — | 25,378 |  | 24,956 | 292 | 24,664 |  | 3 |
| Barclays UK | (4,393) | (168) | (4,225) |  | (4,260) | — | (4,260) |  | 1 |
| Corporate and Investment Bank | (8,335) | (188) | (8,147) |  | (7,630) | — | (7,630) |  | (7) |
| Consumer, Cards and Payments | (3,243) | (118) | (3,125) |  | (2,731) | — | (2,731) |  | (14) |
| Barclays International | (11,578) | (306) | (11,272) |  | (10,361) | — | (10,361) |  | (9) |
| Head Office | (743) | (453) | (290) |  | (336) | — | (336) |  | 14 |
| Total operating costs | (16,714) | (927) | (15,787) |  | (14,957) | — | (14,957) |  | (6) |
| UK bank levy | (180) | — | (180) |  | (176) | — | (176) |  | (2) |
| Litigation and conduct | (37) | — | (37) |  | (1,597) | (966) | (631) |  | 94 |
| Total operating expenses | (16,931) | (927) | (16,004) |  | (16,730) | (966) | (15,764) |  | (2) |
| Other net (expenses)/income | (9) | — | (9) |  | 6 | — | 6 |  |  |
| Profit before impairment | 8,438 | (927) | 9,365 |  | 8,232 | (674) | 8,906 |  | 5 |
| Credit impairment charges | (1,881) | — | (1,881) |  | (1,220) | — | (1,220) |  | (54) |
| Profit before tax | 6,557 | (927) | 7,484 |  | 7,012 | (674) | 7,686 |  | (3) |
| Attributable profit | 4,274 | (739) | 5,013 |  | 5,023 | (552) | 5,575 |  | (10) |
|  |  |  |  |  |  |  |  |  |  |
| Average tangible shareholders' equity | £47.4bn |  | £47.4bn |  | £48.3bn |  | £48.3bn |  |  |
| Return on average tangible shareholders' equity | 9.0% |  | 10.6% |  | 10.4% |  | 11.6% |  |  |
| Cost: income ratio | 67% |  | 63% |  | 67% |  | 64% |  |  |

Note

1 Adjusting items: Q423 structural cost actions in 2023 and impact of Over-issuance of Securities in 2022

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 390 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-IFRS performance measures (continued) | | | | | | | | | | |

Performance measures excluding the impact of Q423 structural cost actions

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | For the year ended 31 December 2023 | | | | | |
|  | Barclays UK | Corporate and  Investment Bank | Consumer, Cards  and Payments | Barclays  International | Head Office | Barclays Group |
| £m | £m | £m | £m | £m | £m |
| Total operating expenses | (4,415) | (8,458) | (3,303) | (11,761) | (755) | (16,931) |
| Q423 structural cost actions | (168) | (188) | (118) | (306) | (453) | (927) |
| Total operating expenses excluding Q423  structural cost actions | (4,247) | (8,270) | (3,185) | (11,455) | (302) | (16,004) |
|  |  |  |  |  |  |  |
| Total income | 7,587 | 12,610 | 5,308 | 17,918 | (127) | 25,378 |
|  |  |  |  |  |  |  |
| Cost: income ratio excluding Q423 structural  cost actions | 56% | 66% | 60% | 64% | n/m | 63% |
|  |  |  |  |  |  |  |
| Profit before tax | 2,868 | 4,126 | 481 | 4,607 | (918) | 6,557 |
| Pre-tax impact of Q423 structural cost actions | (168) | (188) | (118) | (306) | (453) | (927) |
| Profit/(loss) before tax excluding Q423 structural  cost actions | 3,036 | 4,314 | 599 | 4,913 | (465) | 7,484 |
|  |  |  |  |  |  |  |
| Attributable profit/(loss) | 1,962 | 2,667 | 358 | 3,025 | (713) | 4,274 |
| Post-tax impact of Q423 structural cost actions | (122) | (140) | (100) | (240) | (376) | (739) |
| Attributable profit/(loss) excluding the impact of  Q423 structural cost actions | 2,084 | 2,807 | 458 | 3,265 | (337) | 5,013 |
|  |  |  |  |  |  |  |
| Average tangible equity | £10.2bn | £31.7bn | £5.3bn | £37.0bn | £0.2bn | £47.4bn |
|  |  |  |  |  |  |  |
| Return on average tangible equity excluding  Q423 structural cost actions | 20.4% | 8.9% | 8.6% | 8.8% | n/m | 10.6% |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 391 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-IFRS performance measures (continued) | | | | | | | | | | |

Reconciliation  of financial results excluding adjusting items 1

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
|  | For the year ended 31 December 2023 | | |  | For the year ended 31 December 2022 | | |  |  |
|  | Statutory | Adjusting  items 1 | Excluding  adjusting  items |  | Statutory | Adjusting  items 1 | Excluding  adjusting  items |  |  |
|  | £m | £m | £m |  | £m | £m | £m |  | % change |
| Income |  |  |  |  |  |  |  |  |  |
| Corporate and Investment Bank | 12,610 | — | 12,610 |  | 13,368 | 292 | 13,076 |  | (4) |
| of which: |  |  |  |  |  |  |  |  |  |
| FICC | 4,845 | — | 4,845 |  | 5,695 | — | 5,695 |  | (15) |
| Equities | 2,373 | — | 2,373 |  | 3,149 | 292 | 2,857 |  | (17) |
| Global Markets | 7,218 | — | 7,218 |  | 8,844 | 292 | 8,552 |  | (16) |
| Consumer, Cards and Payments | 5,308 | — | 5,308 |  | 4,499 | — | 4,499 |  | 18 |
| Barclays International | 17,918 | — | 17,918 |  | 17,867 | 292 | 17,575 |  | 2 |
|  |  |  |  |  |  |  |  |  |  |
| Total operating expenses |  |  |  |  |  |  |  |  |  |
| Corporate and Investment Bank | (8,458) | (188) | (8,270) |  | (8,945) | (966) | (7,979) |  | (4) |
| Consumer, Cards and Payments | (3,303) | (118) | (3,185) |  | (3,052) | — | (3,052) |  | (4) |
| Barclays International | (11,761) | (306) | (11,455) |  | (11,997) | (966) | (11,031) |  | (4) |

Note

1 Adjusting items: Q423 structural cost actions in 2023 and impact of Over-issuance of Securities in 2022.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 392 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-IFRS performance measures (continued) | | | | | | | | | | |

Tangible net asset value per share

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Total equity excluding non-controlling interests | 71,204 | 68,292 | 69,052 |
| Other equity instruments | (13,259) | (13,284) | (12,259) |
| Goodwill and intangibles | (7,794) | (8,239) | (8,061) |
| Tangible shareholders’ equity attributable to ordinary shareholders of the parent | 50,151 | 46,769 | 48,732 |
|  |  |  |  |
| Shares in issue | 15,155m | 15,871m | 16,752m |
|  |  |  |  |
| Tangible net asset value per share | 331p | 295p | 291p |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review |  | Financial  review | Financial  statements |  | Barclays PLC  Annual Report 2023 | 393 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Non-IFRS performance measures (continued) | | | | | | | | | | |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  | Financial statements | |  |  |  |
|  | Detailed analysis of our statutory accounts,  independently audited and providing in-depth  disclosure on the financial performance of the Group. | |  |  |  |
|  | Barclays has adopted the British Bankers’ Association (BBA) Code for Financial Reporting  Disclosure as adopted by UK Finance in 2017 and has prepared the 2023 Annual Report in  compliance with the BBA Code. Barclays is committed to continuously reflect the objectives  of reporting set out in the BBA Code. | |  |  |  |
|  |  |  |  |  |  |
|  |  |  | Page | Note |  |
|  | Consolidated financial statements | [Independent Auditor’s Report](#i4be61753b7f243b19551b0bfbf3a2a0d_871) | [396](#i4be61753b7f243b19551b0bfbf3a2a0d_871) |  |  |
|  |  | [Consolidated income statement](#i4be61753b7f243b19551b0bfbf3a2a0d_880) | [413](#i4be61753b7f243b19551b0bfbf3a2a0d_880) |  |  |
|  |  | [Consolidated statement of comprehensive income](#i4be61753b7f243b19551b0bfbf3a2a0d_883) | [414](#i4be61753b7f243b19551b0bfbf3a2a0d_883) |  |  |
|  |  | [Consolidated balance sheet](#i4be61753b7f243b19551b0bfbf3a2a0d_886) | [415](#i4be61753b7f243b19551b0bfbf3a2a0d_886) |  |  |
|  |  | [Consolidated statement of changes in equity](#i4be61753b7f243b19551b0bfbf3a2a0d_889) | [416](#i4be61753b7f243b19551b0bfbf3a2a0d_889) |  |  |
|  |  | [Consolidated cash flow statement](#i4be61753b7f243b19551b0bfbf3a2a0d_895) | [417](#i4be61753b7f243b19551b0bfbf3a2a0d_895) |  |  |
|  |  | [Parent company accounts](#i4be61753b7f243b19551b0bfbf3a2a0d_898) | [418](#i4be61753b7f243b19551b0bfbf3a2a0d_898) |  |  |
|  | Notes to the financial statements | Material [accounting policies](#i4be61753b7f243b19551b0bfbf3a2a0d_913) | [421](#i4be61753b7f243b19551b0bfbf3a2a0d_913) | 1 |  |
|  | Financial performance and returns | [Segmental reporting](#i4be61753b7f243b19551b0bfbf3a2a0d_916) | [425](#i4be61753b7f243b19551b0bfbf3a2a0d_916) | 2 |  |
|  |  | [Net interest income](#i4be61753b7f243b19551b0bfbf3a2a0d_919) | [427](#i4be61753b7f243b19551b0bfbf3a2a0d_919) | 3 |  |
|  |  | [Net fee and commission income](#i4be61753b7f243b19551b0bfbf3a2a0d_922) | [428](#i4be61753b7f243b19551b0bfbf3a2a0d_922) | 4 |  |
|  |  | [Net trading income](#i4be61753b7f243b19551b0bfbf3a2a0d_925) | [430](#i4be61753b7f243b19551b0bfbf3a2a0d_925) | 5 |  |
|  |  | [Net investment income](#i4be61753b7f243b19551b0bfbf3a2a0d_928) | [430](#i4be61753b7f243b19551b0bfbf3a2a0d_928) | 6 |  |
|  |  | [Operating expenses](#i4be61753b7f243b19551b0bfbf3a2a0d_931) | [431](#i4be61753b7f243b19551b0bfbf3a2a0d_934) | 7 |  |
|  |  | [Credit impairment charges](#i4be61753b7f243b19551b0bfbf3a2a0d_934) | [431](#i4be61753b7f243b19551b0bfbf3a2a0d_931) | 8 |  |
|  |  | [Tax](#i4be61753b7f243b19551b0bfbf3a2a0d_937) | [434](#i4be61753b7f243b19551b0bfbf3a2a0d_937) | 9 |  |
|  |  | [Earnings per share](#i4be61753b7f243b19551b0bfbf3a2a0d_940) | [439](#i4be61753b7f243b19551b0bfbf3a2a0d_940) | 10 |  |
|  |  | [Dividends on ordinary shares](#i4be61753b7f243b19551b0bfbf3a2a0d_943) | [439](#i4be61753b7f243b19551b0bfbf3a2a0d_943) | 11 |  |
|  | Assets and liabilities held at fair value | [Trading portfolio](#i4be61753b7f243b19551b0bfbf3a2a0d_946) | [440](#i4be61753b7f243b19551b0bfbf3a2a0d_946) | 12 |  |
|  |  | [Financial assets at fair value through](#i4be61753b7f243b19551b0bfbf3a2a0d_949)  [the income statement](#i4be61753b7f243b19551b0bfbf3a2a0d_949) | [440](#i4be61753b7f243b19551b0bfbf3a2a0d_949) | 13 |  |
|  |  | [Derivative financial instruments](#i4be61753b7f243b19551b0bfbf3a2a0d_952) | [441](#i4be61753b7f243b19551b0bfbf3a2a0d_952) | 14 |  |
|  |  | [Financial assets at fair value through](#i4be61753b7f243b19551b0bfbf3a2a0d_955)  [other comprehensive income](#i4be61753b7f243b19551b0bfbf3a2a0d_955) | [448](#i4be61753b7f243b19551b0bfbf3a2a0d_955) | 15 |  |
|  |  |  |
|  |  | [Financial liabilities designated at fair value](#i4be61753b7f243b19551b0bfbf3a2a0d_958) | [448](#i4be61753b7f243b19551b0bfbf3a2a0d_958) | 16 |  |
|  |  | [Fair value of financial instruments](#i4be61753b7f243b19551b0bfbf3a2a0d_961) | [449](#i4be61753b7f243b19551b0bfbf3a2a0d_961) | 17 |  |
|  |  | [Offsetting financial assets and financial liabilities](#i4be61753b7f243b19551b0bfbf3a2a0d_964) | [459](#i4be61753b7f243b19551b0bfbf3a2a0d_964) | 18 |  |
|  |  |  |  |  |  |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  |  |  |  |  |  |
|  | Assets at amortised cost  and other investments |  | Page | Note |  |
|  |  | [Property, plant and equipment](#i4be61753b7f243b19551b0bfbf3a2a0d_970) | [460](#i4be61753b7f243b19551b0bfbf3a2a0d_970) | 19 |  |
|  | [Leases](#i4be61753b7f243b19551b0bfbf3a2a0d_973) | [461](#i4be61753b7f243b19551b0bfbf3a2a0d_973) | 20 |  |
|  |  | [Goodwill and intangible assets](#i4be61753b7f243b19551b0bfbf3a2a0d_976) | [464](#i4be61753b7f243b19551b0bfbf3a2a0d_976) | 21 |  |
|  | Accruals, provisions, contingent  liabilities and legal proceedings | [Other liabilities](#i4be61753b7f243b19551b0bfbf3a2a0d_979) | [468](#i4be61753b7f243b19551b0bfbf3a2a0d_979) | 22 |  |
|  | [Provisions](#i4be61753b7f243b19551b0bfbf3a2a0d_982) | [468](#i4be61753b7f243b19551b0bfbf3a2a0d_982) | 23 |  |
|  |  | [Contingent liabilities and commitments](#i4be61753b7f243b19551b0bfbf3a2a0d_985) | [469](#i4be61753b7f243b19551b0bfbf3a2a0d_985) | 24 |  |
|  |  | [Legal, competition and regulatory matters](#i4be61753b7f243b19551b0bfbf3a2a0d_988) | [470](#i4be61753b7f243b19551b0bfbf3a2a0d_988) | 25 |  |
|  | Capital instruments,  equity and reserves | [Subordinated liabilities](#i4be61753b7f243b19551b0bfbf3a2a0d_994) | [475](#i4be61753b7f243b19551b0bfbf3a2a0d_994) | 26 |  |
|  | [Ordinary shares, share premium and other equity](#i4be61753b7f243b19551b0bfbf3a2a0d_997) | [477](#i4be61753b7f243b19551b0bfbf3a2a0d_997) | 27 |  |
|  |  | [Reserves](#i4be61753b7f243b19551b0bfbf3a2a0d_1000) | [478](#i4be61753b7f243b19551b0bfbf3a2a0d_1000) | 28 |  |
|  |  | [Non-controlling interests](#i4be61753b7f243b19551b0bfbf3a2a0d_1003) | [479](#i4be61753b7f243b19551b0bfbf3a2a0d_1003) | 29 |  |
|  | Employee benefits | [Staff costs](#i4be61753b7f243b19551b0bfbf3a2a0d_1006) | [480](#i4be61753b7f243b19551b0bfbf3a2a0d_1006) | 30 |  |
|  |  | [Share-based payments](#i4be61753b7f243b19551b0bfbf3a2a0d_1009) | [481](#i4be61753b7f243b19551b0bfbf3a2a0d_1009) | 31 |  |
|  |  | [Pensions and post-retirement benefits](#i4be61753b7f243b19551b0bfbf3a2a0d_1012) | [483](#i4be61753b7f243b19551b0bfbf3a2a0d_1012) | 32 |  |
|  | Scope of consolidation | [Principal subsidiaries](#i4be61753b7f243b19551b0bfbf3a2a0d_1015) | [489](#i4be61753b7f243b19551b0bfbf3a2a0d_1015) | 33 |  |
|  |  | [Structured entities](#i4be61753b7f243b19551b0bfbf3a2a0d_1018) | [491](#i4be61753b7f243b19551b0bfbf3a2a0d_1018) | 34 |  |
|  |  | [Investments in associates and joint ventures](#i4be61753b7f243b19551b0bfbf3a2a0d_1021) | [495](#i4be61753b7f243b19551b0bfbf3a2a0d_1021) | 35 |  |
|  |  | [Securitisations](#i4be61753b7f243b19551b0bfbf3a2a0d_1024) | [495](#i4be61753b7f243b19551b0bfbf3a2a0d_1024) | 36 |  |
|  |  | [Assets pledged, collateral received](#i4be61753b7f243b19551b0bfbf3a2a0d_1027)  [and assets transferred](#i4be61753b7f243b19551b0bfbf3a2a0d_1027) | [497](#i4be61753b7f243b19551b0bfbf3a2a0d_1027) | 37 |  |
|  | Other disclosure matters | [Related party transactions and Directors’ remuneration](#i4be61753b7f243b19551b0bfbf3a2a0d_1030) | [499](#i4be61753b7f243b19551b0bfbf3a2a0d_1030) | 38 |  |
|  |  | [Auditor’s remuneration](#i4be61753b7f243b19551b0bfbf3a2a0d_1033) | [501](#i4be61753b7f243b19551b0bfbf3a2a0d_1033) | 39 |  |
|  |  | Assets and liabilities included in disposal group classified  as held for sale | [502](#i4be61753b7f243b19551b0bfbf3a2a0d_231447197665476) | 40 |  |
|  |  | Subsequent events | [502](#i4be61753b7f243b19551b0bfbf3a2a0d_20802) | 41 |  |
|  |  | [Barclays PLC (the Parent company)](#i4be61753b7f243b19551b0bfbf3a2a0d_1042) | [503](#i4be61753b7f243b19551b0bfbf3a2a0d_1042) | 42 |  |
|  |  | [Related undertakings](#i4be61753b7f243b19551b0bfbf3a2a0d_1048) | [504](#i4be61753b7f243b19551b0bfbf3a2a0d_1048) | 43 |  |
|  |  |  |  |  |  |

1. Our opinion is unmodified

In our opinion:

• the financial statements of Barclays PLC

give a true and fair view of the state of

the Group’s and of the Parent

Company’s affairs as at 31 December

2023, and of the Group’s and the Parent

Company’s profit for the year then

ended;

• the Group financial statements have

been properly prepared in accordance

with UK-adopted international

accounting standards;

• the Parent Company financial

statements have been properly

prepared in accordance with UK-

adopted international accounting

standards as applied in accordance with

the provisions of the Companies Act

2006;

• the Group and Parent Company financial

statements have been prepared in

accordance with the requirements of

the Companies Act 2006.

What our opinion covers

We have audited the Group and Parent

Company financial statements of Barclays

PLC for the year ended 31 December

2023 (FY23) included in the Annual Report

and Accounts, which comprise:

Group (Barclays PLC and its subsidiaries)

• Consolidated income statement

• Consolidated statement of

comprehensive income

• Consolidated balance sheet

• Consolidated statement of changes in

equity

• Consolidated cash flow statement

• Notes 1 to 43 of the Consolidated

Financial Statements, including the

summary of material accounting policies

Parent Company (Barclays PLC)

• Statement of comprehensive income

• Balance sheet

• Statement of changes in equity

• Cash flow statement

• Note 42 to the Consolidated Financial

Statements, including the summary of

material accounting policies

Basis for opinion

We conducted our audit in accordance

with International Standards on Auditing

(UK) (“ISAs (UK)”) and applicable law.  Our

responsibilities are described below.  We

believe that the audit evidence we have

obtained is a sufficient and appropriate

basis for our opinion.  Our audit opinion

and matters included in this report are

consistent with those discussed and

included in our reporting to the Board

Audit Committee (“BAC”).

We have fulfilled our ethical responsibilities

under, and we remain independent of the

Group in accordance with, UK ethical

requirements including the FRC Ethical

Standard as applied to listed public interest

entities.

2. Overview of our audit

Factors driving our view of risks

Following our FY22 audit and considering

developments affecting the Barclays PLC

Group since then, we have updated our

risk assessment.

The macro-economic environment

continues to drive our risk assessment as

general economic uncertainty has led to

sustained affordability pressures

associated with rising inflation and interest

rates.

This economic uncertainty and change has

brought both pressures and opportunities.

The higher interest rate environment has

provided an uplift to net interest income,

and has driven increased competition for

deposits.

Lower market volatility and reduced client

activity have created a challenging

environment within the Corporate and

Investment Bank, resulting in lower income

for FY23.

As part of our risk assessment, we have

maintained our focus on future economic

assumptions used by the Group in its key

estimates both at the year end and, where

relevant, on a forward-looking basis.

Our risk assessment also considered

instances of non-compliance with laws and

regulations (including open enforcement

actions against the Group) and specifically

those that could reasonably be expected

to have a material effect on the financial

statements. We considered

management’s assessment of how these

occurred and their assessment of whether

the risk could be more pervasive.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  |  |  |  |
|  | Key Audit Matters |  | Item |  |
|  | Impairment allowance on  loans and advances at  amortised cost, including off-  balance sheet elements of the  allowance | & | 4.1 |  |
|  | Valuation of financial  instruments held at fair value | 1 | 4.2 |  |
|  | Valuation of gross defined  benefit pension obligation in  respect of the UK retirement  fund ('UKRF') | 1 | 4.3 |  |
|  | User access management | 1 | 4.4 |  |
|  | Recoverability of Parent  Company’s investment  in subsidiaries | 1 | 4.5 |  |
|  |  |  |  |  |
|  | Similar risk to FY22 | 1 |  |  |
|  | Increased risk since FY22 | & |  |  |
|  |  |  |  |  |

Our use of specialists and innovation

Using the work of specialists and specific

team members with expertise in a

specialised area of accounting or

auditing: We used our specialists and

specific team members with expertise in a

specialised area of accounting or auditing

to assist us in various aspects of our audit.

This included, for example:

• Credit risk modellers for our testing of

the ECL models

• Economics specialists for our work

related to the macro-economic

variables and scenarios used in the

determination of the ECL provisions

• Valuation specialists for our

independent repricing of samples of

financial instruments

• Corporate finance valuation specialists

for our work over the methodology

underpinning, and certain of the

assumptions used in, the impairment

assessment of goodwill and intangibles

and the carrying value of subsidiaries

• Actuarial pensions specialists for our

work on the valuation of the defined

benefit obligation

• Tax specialists for our work over the tax

charge, the effective tax rate and

uncertain tax positions

• IT auditors for our testing of automated

and general IT controls

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 396 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC | | | | | | | | | | |

Incorporating unpredictability into our

audit: A requirement of the auditing

standards is that we undertake procedures

which are deliberately unexpected and

could not have reasonably been predicted

by Barclays’ management.  As an example,

we update our criteria for selecting journals

with a higher risk of management override

each year so that the selection criteria do

not become predictable. Outside of

journals, for a selection of fair value

financial instruments, we performed intra-

month independent re-pricing to

incorporate an element of unpredictability

in our audit procedures.

Innovation in the audit: Our audit is

committed to driving innovation and the

increased use of technology. In 2023 we

have continued to deploy a large number

of data and analytics tools across our audit.

We have also continued to innovate our

audit of valuation of financial instruments,

by using the Digital Media Analytics tool to

gather market news and data for key

principal investments and leveraged

finance exposures for consideration as

part of our risk assessment procedures.

Board Audit Committee (“BAC”)

interaction

During the year, the BAC met 11 times.

KPMG are invited to attend all BAC

meetings and are provided an opportunity

to meet with the BAC in private sessions

without the Executive Directors being

present. For each Key Audit Matter, we

have set out communications with the

BAC in section 4, including matters that

required particular judgement for each.

In addition, our audit team includes a senior

partner who has specific responsibility for

ensuring audit quality (our “Audit Quality

Partner”). The Board Audit Committee met

with the Audit Quality Partner twice in the

year to receive a report on his assessment

of audit quality. The Board Audit

Committee also met with KPMG’s Head of

Audit Quality who provided an update on

the initiatives KPMG is taking to sustain

high levels of audit quality.

The matters included in the BAC Chair’s

report on page [166](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686054584) are materially

consistent with our observations of those

meetings.

In addition, KPMG are invited to attend the

Board Risk Committee meetings.

Our independence

We have fulfilled our ethical responsibilities

under, and we remain independent of the

Group in accordance with, UK ethical

requirements including the FRC Ethical

Standard as applied to listed public interest

entities.

Apart from the matters noted below, we

have not performed any non-audit

services during the year ended 31

December 2023 or subsequently which are

prohibited by the FRC Ethical Standard.

We have identified that a KPMG member firm

has provided preparation of local financial

statements services over the period 2018 to

2023. That member firm had no involvement

in the group audit of Barclays PLC. The

services, which have been terminated, were

administrative in nature and did not involve

any management decision-making or

bookkeeping. The work was undertaken after

the group audit opinion was signed by KPMG

LLP for each of the related financial years and

had no direct or indirect effect on Barclays

PLC’s consolidated financial statements.

In our professional judgment, we confirm

that based on our assessment of the

breach, our integrity and objectivity as

auditor has not been compromised and we

believe that an objective, reasonable and

informed third party would conclude that

the provision of these services would not

impair our integrity or objectivity for any of

the impacted financial years. The Board

Audit Committee concurred with this view.

We were first appointed as auditor by the

shareholders for the year ended 31

December 2017. The period of total

uninterrupted engagement is for the seven

financial years ended 31 December 2023.

The Group lead engagement partner is

required to rotate after five years. This is

the second set of UK Financial Statements

that Stuart Crisp has signed and he will be

required to rotate after the FY26 audit.

The average tenure of key audit partners

who are responsible for component audits,

as set out in section 7 below, is two years,

with the shortest being their first year of

involvement and longest being five years.

|  |  |
| --- | --- |
|  |  |
| Total audit fee | £64m |
| Other audit related fees | £12m |
| Other services | £2m |
| Date first appointed | 31 March 2017 |
| Uninterrupted audit tenure | 7 years |
| Next financial period which requires a tender | 31 December 2027 |
| Tenure of Group lead engagement partner | 2 years |
| Average tenure of key audit partners | 2 years |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 397 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

Materiality

(Item 6 below)

The scope of our work is influenced by our

view of materiality and our assessed risk of

material misstatement.

We have determined overall materiality for

the Barclays PLC Group to be £350m

(FY22: £275m).

We determined that profit before tax (PBT)

remains the key benchmark for the

Barclays PLC Group. For FY23, we adjusted

PBT for items which do not represent the

normal, continuing operations of the

Group. As such, for FY23 we based our

materiality on normalised profit before tax

of £7,484m, of which it represents 4.7%

(FY22: 3.9%).

Materiality for the parent company

financial statements as a whole was set at

£170m (2022: £100m), which is the

component materiality for the parent

company determined by the group audit

engagement team. This is lower than the

materiality we would otherwise have

determined with reference to a benchmark

of net assets of which it represents 0.3%

(FY22: 0.2%).

|  |
| --- |
|  |
| Normalised profit before tax £7,484m  (2022 PBT: £7,012m) |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| n | Normalised  profit before  tax | £7,484m |
| n | Group  materiality | £350m |
|  |  |  |

![9976]()

![9986]()

|  |  |
| --- | --- |
|  |  |
| A | £350m  Whole financial  statements materiality  (2022: £275m) |
|  |  |
| B | £227m  Performance materiality  (2022: £179m) |
| C | £17m  Misstatements reported to the  Board Audit Committee  (2022: £13m) |

Group scope

(Item 7 below)

We have performed risk assessment and

planning procedures to determine which of

the Group’s components are likely to

include risks of material misstatement to

the Group financial statements, the type of

procedures to be performed at these

components and the extent of

involvement required from component

auditors around the world for the purpose

of our opinion on the consolidated financial

statements.

We have also considered the extent to

which the Group has established central

hubs in shared service centre structures in

India. The outputs from these hubs are

included in the financial information of the

reporting components and so the India

operations are not considered to be a

separate component.

We have performed certain audit

procedures centrally across the Group, set

out in more detail in Section 7. In addition,

we have performed Group level analysis on

the remaining components to determine

whether further risks of material

misstatement exist in those components.

We consider the scope of our audit, as

communicated to the Board Audit

Committee, to be an appropriate basis for

our audit opinion.

The components within the scope of our

work accounted for the following

percentages:

Coverage of Group financial statements

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Group total income\* | | |
|  |  |  |
| n | 2023 Full scope  audit |  |
| n | 2023 Audit of  account balances |  |
| n | 2023 Specific audit  procedures |  |
| n | 2023 Other risk  assessment  procedures |  |
| n | 2022 Full scope  audit |  |
| n | 2022 Audit of  account balances |  |
| n | 2022 Other risk  assessment  procedures |  |
|  |  |
| Group total assets\* | | |
|  | | |
| n | 2023 Full scope  audit |  |
| n | 2023 Audit of  account balances |  |
| n | 2023 Specific audit  procedures |  |
| n | 2023 Other risk  assessment  procedures |  |
| n | 2022 Full scope  audit |  |
| n | 2022 Audit of  account balances |  |
| n | 2022 Other risk  assessment  procedures |  |
| Note  \* Percentage of Group total income and assets over  which we performed full scope audit or audit of  account balances | | |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 398 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

![41231686041616]()

![41231686041668]()

![41231686041738]()

![41231686041750]()

(2022:

95 %)

(2022:

97%)

The impact of climate change on our audit

In planning our audit, we have considered

the potential impact of risks arising from

climate change on the Group’s business

and its financial statements. The Group

has set out its ambition under the Paris

Accord to be a net zero bank by 2050.

Further information is provided in the

Group’s Climate and Sustainability report,

which has been incorporated into the 2023

Annual Report on pages 59 -129.

Climate change risks, opportunities and

the Group’s own commitments and

changing regulations could have a

significant impact on the Group’s business

and operations. There is the possibility that

climate change risks, both physical and

transitional, could affect financial

statement balances, through estimates

such as credit risk and market risk. There is

enhanced narrative in the Annual Report

on climate matters.

As part of our audit we performed a risk

assessment of the impact of climate

change risk and the commitments made

by the Group in respect of climate change

on the financial statements and our audit

approach. As a part of this we held

discussions with our own climate change

professionals to challenge our risk

assessment. In doing this we performed

the following:

• Understanding management’s

processes: we made enquiries to

understand management’s assessment

of the potential impact of climate

change risk on the Group’s Annual

Report and Accounts and the Group’s

preparedness for this. As a part of this

we made enquiries to understand

management’s risk assessment process

as it relates to possible effects of

climate change on the Annual Report

and Accounts including the way in which

the accounting policies of the Group

(including those relating to products

with specific climate features) are

updated to reflect climate change risks.

We also read and discussed with

management the quantitative analysis

prepared by the Group to support its

assessment of the impact of climate risk

on credit risk.

• Retail credit risk: we assessed how the

Group considers the impact of physical

risks on the valuation of mortgage

collateral. Specifically, we performed

data and analytic driven risk assessment

procedures to understand the potential

impact of flooding and subsidence on

the valuation of mortgage collateral and

made enquiries of management to

understand how this is considered within

their own collateral valuation process.

• Corporate credit risk: we assessed how

the Group considers the impact of

climate risk on corporate counterparties

through our individual loan assessments

where, for performing counterparties,

we assessed how climate change risk

impacts certain counterparties within

the commercial bank, including the

impact on their credit rating as

applicable. The focus of our procedures

was on certain counterparties who

operate in industries with greater

exposure to climate risk - the energy,

transportation, materials and buildings,

agriculture, food and forest product

sectors.

• Market risk: as part of our risk

assessment, we incorporated a

consideration of the climate change

impact on unobservable inputs used in

the valuation of certain financial

instruments in elevated risk sectors

including energy, metals and mining.

• Annual report narrative: we made

enquiries of management to understand

the process by which climate related

narrative is developed including the

primary sources of data used and the

governance process in place over the

narrative. As a part of our risk

assessment, we read the climate related

information in the front half of the

Annual Report and considered

consistency with the financial

statements and our audit knowledge.

On the basis of the procedures performed

above, we concluded that, while climate

change posed a risk to the determination

of asset values in the current year, the risk

was not significant when we considered

the nature of the assets and the relevant

contractual terms.  As a result, there was

no material impact from climate change on

our key audit matters.

3. Going concern, viability and

principal risks and uncertainties

The Directors have prepared the financial

statements on the going concern basis as

they do not intend to liquidate the Group

or the Parent Company or to cease their

operations, and they have concluded that

the Group’s and the Parent Company’s

financial position means that this is

realistic.

They have also concluded that there are

no material uncertainties that could have

cast significant doubt over their ability to

continue as a going concern for at least a

year from the date of approval of the

financial statements (“the going concern

period”).

Going concern

We used our knowledge of the Group and

Parent Company, the financial services

industry, and the general economic

environment to identify the inherent risks

to the business model and analysed how

those risks might affect the Group’s and

Parent Company’s financial resources or

ability to continue operations over the

going concern period. The risks that we

considered most likely to adversely affect

the Group’s and Parent Company’s

available financial resources over this

period were:

• the availability of funding and liquidity in

the event of a market wide stress

scenario; and

• the impact on regulatory capital

requirements in the event of an

economic slowdown.

We considered whether these risks could

plausibly affect the availability of financial

resources in the going concern period by

comparing severe, but plausible downside

scenarios that could arise from these risks

individually and collectively against the level

of available financial resources indicated by

the Group’s financial forecasts.

Our procedures also included an

assessment of whether the going concern

disclosure in note 1 to the financial

statements gives a complete and accurate

description of the Directors’ assessment

of going concern.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 399 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

Accordingly, based on those procedures,

we found the directors’ use of the going

concern basis of preparation without any

material uncertainty for the Group and

Parent Company to be acceptable.

However, as we cannot predict all future

events or conditions and as subsequent

events may result in outcomes that are

inconsistent with judgements that were

reasonable at the time they were made,

the above conclusions are not a guarantee

that the Group or the Parent Company will

continue in operation.

Our conclusions

• We consider that the directors’ use of

the going concern basis of accounting in

the preparation of the Group’s and

Parent Company’s financial statements

is appropriate;

• We have not identified, and concur with

the directors’ assessment that there is

not, a material uncertainty related to

events or conditions that, individually or

collectively, may cast significant doubt

on the Group’s or Parent Company's

ability to continue as a going concern for

the going concern period;

• We have nothing material to add or draw

attention to in relation to the directors’

statement in Note 1 to the financial

statements on the use of the going

concern basis of accounting with no

material uncertainties that may cast

significant doubt over the Group and

Parent Company’s use of that basis for

the going concern period, and we found

the going concern disclosure in note 1

to be acceptable; and

• The related statement under the Listing

Rules set out on page [54](#i4be61753b7f243b19551b0bfbf3a2a0d_214) is materially

consistent with the financial statements

and our audit knowledge.

Disclosures of emerging and principal

risks and longer-term viability

Our responsibility

We are required to perform procedures to

identify whether there is a material

inconsistency between the directors’

disclosures in respect of emerging and

principal risks and the viability statement,

and the financial statements and our audit

knowledge.

Based on those procedures, we have

nothing further to add or draw attention to

in relation to:

• the directors’ confirmation within the

viability statement that they have

carried out a robust assessment of the

emerging and principal risks facing the

Group, including those that would

threaten its business model, future

performance, solvency and liquidity;

• the Principal Risks and Uncertainties

disclosures describing these risks and

how emerging risks are identified and

explaining how they are being managed

and mitigated; and

• the directors’ explanation in the viability

statement of how they have assessed

the prospects of the Group, over what

period they have done so and why they

considered that period to be

appropriate, and their statement as to

whether they have a reasonable

expectation that the Group will be able

to continue in operation and meet its

liabilities as they fall due over the period

of their assessment, including any

related disclosures drawing attention to

any necessary qualifications or

assumptions.

We are also required to review the Viability

Statement set out on page [54](#i4be61753b7f243b19551b0bfbf3a2a0d_214) under the

Listing Rules.

Our work is limited to assessing these

matters in the context of only the

knowledge acquired during our financial

statements audit.  As we cannot predict all

future events or conditions and as

subsequent events may result in

outcomes that are inconsistent with

judgements that were reasonable at the

time they were made, the absence of

anything to report on these statements is

not a guarantee as to the Group’s and

Parent Company’s longer-term viability.

Our reporting

• We have nothing material to add or draw

attention to in relation to these

disclosures.

• We have concluded that these

disclosures are materially consistent

with the financial statements and our

audit knowledge.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 400 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

4. Key audit matters

What we mean

Key Audit Matters are those matters that, in our professional judgement, were of most significance in the audit of the financial

statements and include the most significant assessed risks of material misstatement (whether or not due to fraud) identified by us,

including those which had the greatest effect on:

• the overall audit strategy;

• the allocation of resources in the audit; and

• directing the efforts of the engagement team.

We include below the Key Audit Matters in decreasing order of audit significance together with our key audit procedures to address

those matters and our results from those procedures. These matters were addressed, and our results are based on procedures

undertaken for the purpose of our audit of the financial statements as a whole. We do not provide a separate opinion on these matters.

4.1 Impairment allowances on loans and advances at amortised cost, including off-balance sheet elements of the allowance

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Financial Statement Elements | FY23 | FY22 | Our assessment of risk vs FY22 | Our results |
| Impairment allowances on loans and advances  at amortised cost, including off-balance sheet  elements of the allowance (see page 292) | £6.3bn | £6.2bn | & Our assessment is that the risk has increased since FY22.  There is increased uncertainty arising from higher interest  rates and continued inflationary pressures. | FY23:  Acceptable  FY22:  Acceptable |

|  |  |
| --- | --- |
|  |  |
| Description of the Key Audit Matter | Our response to the risk |
| Subjective estimate | Our procedures to address the risk included: |
| The estimation of expected credit losses  (“ECL”) on financial instruments involves  significant judgement and estimates. The key  areas where we identified greater levels of  management judgement and therefore  increased levels of audit focus in the Group’s  estimation of ECL are:  • Model estimations – Inherently judgemental  modelling and assumptions are used to  estimate ECL which involves determining  Probability of Default (“PD”), Loss Given  Default (“LGD”), and Exposure at Default  (“EAD”). ECL may be inappropriate if certain  models or underlying assumptions do not  accurately predict defaults or recoveries  over time, become out of line with wider  industry experience, or fail to reflect the  credit risk of financial assets. As a result,  certain IFRS 9 models and model  assumptions are the key drivers of  complexity and uncertainty in the Group’s  calculation of the ECL estimate.  • Economic scenarios – IFRS 9 requires the  Group to measure ECL on an unbiased  forward-looking basis reflecting a range of  future economic conditions. Significant  management judgement is applied in  determining the forward-looking economic  scenarios used as an input to calculate ECL,  the associated scenario probability  weightings, and the key economic variables  that drive the scenarios. There is also a high  level of complexity of models used to derive  the probability weightings. | Risk assessment: We performed granular and detailed risk assessment procedures over the entirety  of the loan and advances at amortised cost including off-balance sheet elements of the allowance  within the Group’s financial statements. As part of these risk assessment procedures, we identified  the portfolios associated with a risk of material misstatement including those arising from significant  judgements over the estimation of ECL either due to inputs, methods or assumptions.  Controls testing: We performed end to end process walkthroughs to identify the key systems,  applications and controls used in the ECL processes. We tested the relevant manual, general IT and  application controls over key systems used in the ECL process.  Key aspects of our controls testing involved evaluating the design and implementation and testing the  operating effectiveness of the key controls over the:  • completeness and accuracy of the key inputs into the IFRS 9 impairment models;  • application of the staging criteria;  • model validation, implementation and monitoring;  • completeness, authorisation and calculation of post model adjustments and management  overlays;  • selection and implementation of economic variables and the controls over the economic scenario  selection and probabilities; and  • credit reviews that determine customer risk ratings for a population of wholesale customers,  including a risk-based selection.  Our credit risk modelling expertise: We involved our own credit risk modellers who assisted in the  following:  • evaluating the Group’s impairment methodologies for compliance with IFRS 9;  • inspecting model code for the calculation of certain components of the ECL model to assess its  consistency with the Group’s model methodology;  • evaluating whether model changes (including updated model code), for a selection of models which  were changed or updated during the year, were appropriate by assessing the updated model  methodology against the applicable accounting standard;  • reperforming the calculation of certain adjustments to assess consistency with the qualitative  adjustment methodologies;  • assessing and reperforming, for a selection of models, the reasonableness of the model  predictions by comparing them against actual results and evaluating the resulting differences;  • evaluating the model output for a selection of models by inspecting the corresponding model  functionality and independently implementing the model by rebuilding the model code and  comparing our independent output with management’s output; and  • independently recalculating a selection of model assumptions using more recent data for certain  portfolios. This is used to develop a range for ECL which is compared to management’s point  estimate. |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 401 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| Description of the Key Audit Matter | Our response to the risk |
| ▪ Qualitative adjustments – Adjustments to  the model-driven ECL results are raised by  management to address known impairment  model limitations, emerging trends, or risks  not captured by models. They represent  approximately 6.1% of the ECL. These  adjustments are inherently uncertain and  significant management judgement is  involved in identifying and estimating certain  post model adjustments (“PMA’s”) and  management overlays.  The effect of these matters is that, as part of  our risk assessment, we determined that the  impairment of loans and advances to  customers including off-balance sheet  elements of the allowance has a high degree of  estimation uncertainty, with a potential range  of reasonable outcomes greater than our  materiality for the financial statements as a  whole, and possibly many times that amount.  The credit risk sections of the financial  statements (pages 291-335) disclose the  sensitivities estimated by the Group.  Disclosure quality  The disclosures regarding the Group’s  application of IFRS 9 are key to explaining the  key judgements and material inputs to the IFRS  9 ECL results. | Our economics expertise: We involved our own economic specialists who assisted us in:  • assessing the reasonableness of the Group’s methodology and models for determining the  economic scenarios used and the probability weightings applied to them;  • assessing key economic variables which included comparing samples of economic variables to  external sources;  • assessing the overall reasonableness of the economic forecasts by comparing the Group’s  forecasts to our own modelled forecasts; and  • assessing the reasonableness of the Group’s qualitative adjustments by challenging key economic  assumptions applied in their calculation based on external sources.  Other test of details:  Key aspects of our testing in addition to those set out above involved:  • sample testing over key inputs into the ECL calculations;  • selecting a sample of post model adjustments, considering the size and complexity of  management overlays, to assess the reasonableness of the adjustments by challenging key  assumptions, inspecting the calculation methodology and tracing a sample of the data used back to  source data;  • assessing the completeness of post model adjustments identified based on our knowledge gained  from other risk-assessment and substantive audit procedures; and  • selecting a sample of credit reviews to assess the reasonableness of customer risk ratings by  challenging key judgements and considering disconfirming or contradictory evidence.  Assessing transparency:   We assessed whether the disclosures appropriately disclose and address  the uncertainty which exists when determining the ECL. In addition, we assessed whether the  disclosure of the key judgements and assumptions was sufficiently clear. |

Communications with the Barclays PLC

Board Audit Committee

Our discussions with and reporting to the

Board Audit Committee included:

• The effectiveness of the control

environment operating over the

calculation of the ECL provisions;

• The determination and utilisation of

judgemental post model adjustments

recognised;

• Model monitoring results and

adjustments made;

• Management’s economic forecast and

associated scenario probability weights;

and

• The disclosures made to explain ECL,

including explaining the resulting

estimation uncertainty.

Areas of particular auditor judgement

We identified the following as the areas of

particular auditor judgement:

• The appropriateness of the model

estimations and qualitative adjustments

recorded to the model driven ECL

calculations to reflect the current

economic environment.

Our results

Based on the risk identified and our

procedures performed we considered the

impairment allowances on loans and

advances at amortised cost, including off-

balance sheet elements and the related

disclosures to be acceptable (2022 result:

acceptable).

Further information in the Annual Report

and Accounts: See the Board Audit

Committee Report on page [166](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686054584) for details

on how the Board Audit Committee

considered impairment as an area of

focus, page [431](#i4be61753b7f243b19551b0bfbf3a2a0d_934) for the accounting policy

on accounting for the impairment of

financial assets under IFRS 9, pages

291-335 for the credit risk disclosures, and

page [431](#i4be61753b7f243b19551b0bfbf3a2a0d_934) for the financial disclosure note

8; Credit Impairment charges.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 402 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

4.2 Valuation of financial instruments held at fair value

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Financial Statement Elements | FY23 | FY22 | Our assessment of risk vs FY22 | Our results |
| Level 2 assets at fair value\* (note 17) | £560bn | £595bn | 1  Our assessment is that the risk is similar to FY22. | FY23:  Acceptable  FY22:  Acceptable |
| Level 2 liabilities at fair value\* (note 17) | £571bn | £572bn |
| Level 3 assets at fair value (note 17) | £19bn | £21bn |
| Level 3 liabilities at fair value (note 17) | £6.2bn | £7.5bn |
| \* In addition to Level 3 portfolios, the key audit matter identified relates to one Level 2 derivatives portfolio within these balances, and certain X VA adjustments made to derivative  valuations, both of which we considered to be harder-to-value. | | | | |

|  |  |
| --- | --- |
|  |  |
| Description of the Key Audit Matter | Our response to the risk |
| Subjective valuation  The fair value of the Group’s financial  instruments is determined through the  application of valuation techniques which can  involve the exercise of significant judgement  by the Group in relation to the choice of the  valuation models, pricing inputs and post-  model pricing adjustments, including fair value  adjustments (FVAs) and credit, collateral and  funding adjustments (together referred to as  XVAs).  Where significant pricing inputs are  unobservable, management has limited  reliable, relevant market data available in  determining the fair value and hence  estimation uncertainty can be high. These  financial instruments are classified as Level 3,  with management having controls in place  over the boundary between Level 2 and 3  positions. Our significant audit risk for the  Level 3 portfolios is therefore primarily due to  these unobservable inputs.  In addition, for the Level 2 portfolios, there  may also be valuation complexity, specifically  where valuation modelling techniques result in  significant limitations or where there is greater  uncertainty around the choice of an  appropriate pricing methodology, and  consequently more than one valuation  methodology could be used for that product  across the market. | Our procedures to address the risk included:  Risk assessment:  We performed granular and detailed risk assessment procedures throughout the  audit period over the entirety of the balances within the Group’s financial statements (i.e. all of the fair  value financial instruments held by the Group). As part of these risk assessment procedures, we  identified which portfolios and the associated valuation inputs have a risk of material misstatement  including those arising from significant judgements over valuation either due to unobservable inputs  or complex models.  Control testing: We attended management’s Valuation Committee throughout the year and  observed discussion and challenge over valuation themes including items related to the valuation of  certain harder-to-value financial instruments recorded at fair value.  We performed end to end process walkthroughs to identify the key systems, applications and controls  used in the valuations processes. We tested the design and operating effectiveness of key controls  relating specifically to these portfolios.  Key aspects of our controls testing involved evaluating the design and implementation and testing the  operating effectiveness of the key controls over:  • independent price verification (IPV), performed by a control function, of key market pricing inputs,  including completeness of positions and valuation inputs subject to the IPV control;  • FVAs, including exit adjustments (to mark the portfolio to bid or offer prices), model shortcoming  reserves to address model limitations and XVAs; and  • the validation, completeness, implementation and usage of valuation models. This included  controls over assessment of model limitations and assumptions.  Our valuations expertise: We involved our own valuation professionals with specialised skills and  knowledge, who assisted in the following:  • independently re-pricing a selection of fair value financial instruments and challenging  management on the valuations where they were outside our tolerance; and  • challenging the appropriateness of significant models and methodologies used in calculating fair  values, risk exposures and in calculating FVAs and XVAs, including comparison to industry practice. |
| We identified two areas of such complexity.  The first a derivatives portfolio that we  considered to be harder to value Level 2 due to  an element of modelling complexity  associated with the product, and the second  the XVA adjustments made to uncollateralised  and partially collateralised derivative  valuations.  The effect of these matters is that, as part of  our risk assessment, we determined that the  subjective estimates in fair value  measurement of Level 3 and harder-to-value  Level 2 portfolios have a high degree of  estimation uncertainty, with a potential range  of reasonable outcomes greater than our  materiality for the financial statements as a  whole, and possibly many times that amount.  The financial statements (note 17) disclose the  sensitivity in Level 3 portfolios estimated by  the Group.  Disclosure quality  For the Level 3 portfolios, the disclosures are  key to explaining the valuation techniques, key  judgements, assumptions and material inputs. | Seeking contradictory evidence: For a selection of collateral disputes identified through  management’s control where significant fair value differences were observable with the market  participant on the other side of the trade, we challenged management’s valuation by inspecting  evidence of the investigation and resolution of the disputes. We also utilised collateral dispute data to  identify fair value financial instruments with significant fair value differences against market  counterparties and selected these to independently reprice.  Inspection of movements: We inspected trading revenue arising on level 3 positions to assess  whether material day one gains or losses generated were in line with the accounting standards.  Historical comparison: We performed a retrospective review by inspecting significant gains and  losses on a selection of new fair value financial instruments, position exits and restructurings  throughout the audit period and evaluated whether these data points indicated elements of fair value  not incorporated in the current valuation methodologies. We also inspected movements in  unobservable inputs throughout the period to challenge whether any gain or loss generated was  appropriate.  Assessing transparency:  For the Level 3 portfolios, we assessed the adequacy of the Group’s  financial statements disclosures in the context of the relevant accounting standards. |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 403 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

Communications with the Barclays PLC

Board Audit Committee

Our discussions with and reporting to the

Board Audit Committee included:

• Our approach to the audit of the fair

value of Level 3 and harder-to-value

Level 2 financial instrument assets and

liabilities. This included details of our risk

assessment, controls and substantive

procedures.

• Our conclusions on the appropriateness

of the Group’s fair value methodology,

models, pricing inputs and fair value

adjustments.

Areas of particular auditor judgement

We identified the following as the areas of

particular auditor judgement:

• The appropriateness of the valuation of

Level 3 and harder-to-value level 2

financial instruments, and particularly

the selection of market data inputs and

valuation models.

Our results

Based on the risk identified and our

procedures performed we consider the fair

value of Level 3 and harder-to-value Level

2 financial instrument assets and liabilities

recognised and the related disclosures to

be acceptable (2022 result: acceptable).

Further information in the Annual Report

and Accounts: See the Board Audit

Committee Report on page [166](#i4be61753b7f243b19551b0bfbf3a2a0d_41231686054584) for details

on how the Board Audit Committee

considered Valuations as an area of focus,

page 449 for the accounting policy on

financial assets and liabilities, and page 449

for the financial disclosure note 17; Fair

value of financial instruments.

4.3 Valuation of the gross defined benefit pension obligation in respect of the UK Retirement Fund (‘UKRF’)

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Financial Statement Elements | FY23 | FY22 | Our assessment of risk vs FY22 | Our results |
| Gross defined benefit obligation related to  UKRF (note 32) | £20.6bn | £20.0bn | 1  Our assessment is that the risk is similar to FY22. | FY23:  Acceptable  FY22:  Acceptable |

|  |  |
| --- | --- |
|  |  |
| Description of the Key Audit Matter | Our response to the risk |
| Subjective valuation  The valuation of the defined benefit obligation  in respect of the UKRF is dependent on key  actuarial assumptions, including the discount  rates, retail price index (‘RPI’) and mortality  assumptions. Small changes to these  assumptions may still have a significant impact  on the measurement of the defined benefit  pension obligation.  As part of our risk assessment, we determined  that the defined benefit pension obligation has  a high degree of estimation uncertainty, with a  potential range of reasonable outcomes  greater than our materiality for the financial  statements, and possibly many times that  amount.  Disclosure quality  The disclosures regarding the Group’s  application of IAS 19 (including risks,  assumptions and sources of estimation  uncertainty) are key to explaining the key  judgements applied in the IAS 19 Defined  Benefit Obligation calculation. | Our procedures to address the risk included:  Control testing:  We performed end to end process walkthroughs to identify the key systems,  applications and controls used in the defined benefit obligation process. We tested the design and  operating effectiveness of key controls relating to the process. These included:  • controls over management’s review of IAS19 assumptions including the discount rate, RPI and  mortality assumptions; and  • reconciliation controls of the IAS19 disclosures to underlying data.  Evaluation of management’s expert: : We evaluated the objectivity and competence of  management’s actuarial expert involved in the valuation of the defined benefit pension obligation.  Our actuarial expertise: We involved our own actuarial professionals in the following:  • evaluating the judgements made and the appropriateness of methodologies used by management  and management’s actuarial expert in determining the key actuarial assumptions; and  • comparing the assumptions used by Barclays PLC to our independently compiled expected ranges  based on market observable indices and our market experience.  Assessing transparency: We assessed the adequacy of the Group’s financial statements disclosures  in the context of the relevant accounting standards. |

Communications with the Barclays PLC

Board Audit Committee

Our discussions with and reporting to the

Board Audit Committee included:

• Our definition of the Key Audit Matter

relating to the valuation of the defined

benefit pension obligation including the

rationale for not including the valuation

of pension assets in the key audit

matter.

• We also discussed our audit response to

the key audit matter which included the

use of specialists to challenge key

aspects of management’s actuarial

valuation.

Areas of particular auditor judgement

We identified the following as areas of

particular auditor judgement:

• Subjective and complex auditor

judgement was required in evaluating

the key actuarial assumptions used by

the Group (including the discount rate,

retail price index and mortality

assumptions).

Our results

Based on the risk identified and our

procedures performed we consider the

valuation of the defined benefit pension

obligation in respect of UKRF and the

related disclosures to be acceptable (2022

result: acceptable).

Further information in the Annual Report

and Accounts: See page 483 for the

accounting policy on defined benefit

schemes, and page 483 for the financial

disclosure note 32; Pensions and post-

retirement benefits.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 404 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

4.4 User access management

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Financial Statement Elements | Our assessment of risk vs FY22 | Our results |
| User access management has a potential impact  throughout the financial statements. | 1  Our assessment is the risk is similar to FY22 | FY23 and FY22:  Our testing did not identify  unauthorised user activities in  the systems relevant to financial  reporting which would have  required us to significantly  expand the extent of our  planned detailed testing. |

|  |  |
| --- | --- |
|  |  |
| Description of the Key Audit Matter | Our response to the risk |
| Control Performance  Operations across several countries support a wide  range of products and services resulting in a large and  complex IT infrastructure relevant to the financial  reporting processes and related internal controls.  User access management controls are an integral part  of the IT environment to ensure both system access  and changes made to systems and data are authorised  and appropriate. Our audit approach relies on the  effectiveness of IT access management controls. Our  audit procedures identified deficiencies in certain IT  access controls for systems relevant to financial  reporting. More specifically, previously identified control  deficiencies remain open around monitoring of activities  performed by privileged users on infrastructure  components. Management has an ongoing programme  to remediate the deficiencies. Since these deficiencies  were open during the year, we performed additional  procedures to respond to the risk of unauthorised  changes to automated controls over financial reporting,  such as an assessment of compensating controls  implemented by management. | Our procedures to address the risk included:  Control testing:  We tested the design, implementation and operating effectiveness of  automated controls that support material balances in the financial statements. We also  tested the design and operating effectiveness of the relevant preventative and detective  general IT controls over user access management including:  • authorising access rights for new joiners;  • timely removal of user access rights;  • logging and monitoring of user activities;  • privileged user access management and monitoring;  • developer access to transaction and balance information;  • segregation of duties;  • re-certification of user access rights; and  • restricting access to make changes to systems and data.  We performed procedures to assess whether additional detective compensating controls  operate at the required level of precision to support our assessed risk of unauthorised  activities and we tested management’s detective controls. |

Communications with the Barclays PLC

Board Audit Committee

Our discussions with and reporting  to the

Board Audit Committee included:

• Our response to the Key Audit Matter.

Areas of particular auditor judgement

We identified the following as the areas of

particular auditor judgement:

• The Key Audit Matter relates to

determining whether user access

management controls were designed

and implemented and operated

effectively. Limited auditor judgement

was required relative to the other Key

Audit Matters which have been

identified.

Our results

Based on the risk identified and our

procedures performed, we did not identify

unauthorised user activities in the systems

relevant to financial reporting which would

have required us to significantly expand

the extent of our planned detailed testing.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 405 |
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| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

4.5 Recoverability of parent company’s investment in subsidiaries

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Financial Statement Elements | FY23 | FY22 | Our assessment of risk vs FY22 | Our results |
| Investment in subsidiaries (Parent company  accounts and note 42) | £64.5bn | £64.5bn | 1  Our assessment is the risk is similar to FY22. | FY23:  Acceptable  FY22:  Acceptable |

|  |  |
| --- | --- |
|  |  |
| Description of the Key Audit Matter | Our response to the risk |
| Subjective assessment  The Parent Company’s investment in subsidiaries may be  misstated if the carrying value of the investment in the  balance sheet is not supported by the recoverable amount  of the investment. Barclays has estimated the recoverable  amount using the future cash flows of the underlying  business (the value in use (“VIU”)).  The calculation of VIU is dependent on certain key  assumptions around the future cash flows which have been  forecasted using the Group’s Medium-Term Plan (‘MTP’),  the discount rates and the terminal growth rates. These  assumptions, which are judgemental, are derived from a  combination of management estimates, market data and  other information obtained from external sources.  These assumptions continued to be impacted by  uncertainty in the wider economic environment. This has  contributed to the complexity and subjectivity in the  impairment assessment process, in addition to the  complexities of the valuation of a Bank.  Due to the materiality of the investment in subsidiaries in  the context of the Parent Company financial statements,  this is the area that had the greatest impact on the overall  Parent Company audit. | Our procedures to address the risk included:  Control testing:  We performed end to end process walkthroughs to identify the key  systems, applications and controls used in the process to assess the carrying value of the  Parent Company’s investment in subsidiaries. We tested the design and operating  effectiveness of the key controls relating to the process. These included controls over  the identification of indicators of impairment and review of the key assumptions in  determining the value in use.  Test of details: We compared the carrying amount of each subsidiary to its draft balance  sheet to identify whether its net assets, being an approximation of their minimum  recoverable amount, were in excess of its carrying amount. We assessed for potential  indicators that investments in subsidiaries might be impaired.  Benchmarking assumptions: For the two largest subsidiaries (Barclays Bank PLC and  Barclays Bank UK PLC) we compared key assumptions in the associated VIU calculations  including those underlying certain estimated future cash flows, the discount rate and the  terminal growth rate to externally derived data including analyst broker reports, peer bank  data and projected economic growth.  Our valuations expertise:  We involved our own valuations specialists to assist us in the  following:  • evaluating the appropriateness of the discount rate used by independently developing  discount rate ranges using external data sources and peer bank data; and  • assessing whether the methodology over management’s calculation of the VIU is  compliant with the requirements of the accounting standard.  Our business understanding: We used our business understanding to evaluate the  reasonableness of certain key assumptions and considerations made when developing  the Group’s MTP estimated future cash flows.  Historical comparison: We performed a retrospective review by comparing the MTP  from previous years to actual results to assess the Group’s ability to accurately prepare  cash flow forecasts at the individual subsidiary level.  Assessing transparency We assessed whether the disclosures around the assessment  of recoverability of the Parent Company’s investment in subsidiaries adequately reflects  key assumptions and sensitivities considering the level of risks inherent in the  assessment of recoverable amount of the Parent Company’s investment in subsidiaries. |

Communications with the Barclays

Board Audit Committee

Our discussions with and reporting to the

Board Audit Committee included:

• Our audit response to the Key Audit

Matter which included the use of

specialists to challenge key aspects of

management’s impairment assessment

and the range of reasonably possible

alternatives for significant assumptions.

Areas of particular auditor judgement

We identified the following as the areas of

particular judgement:

• We identified the reasonableness of the

assumptions underlying the estimated

future cash flows and appropriateness

of the discount rate, which was used in

the impairment assessment, as the

areas of particular judgement.

Our results

Based on our procedures performed, we

consider the Parent Company’s

investment in subsidiaries balance to be

acceptable (2022 result: acceptable).

Further information in the Annual Report

and Accounts: See page 503 for the

accounting policy on the recoverability of

the investment in subsidiaries and page

503 for the financial disclosure note 42;

Barclays PLC (the Parent Company).

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 406 |
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| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

5. Our ability to detect

irregularities, and our response

Fraud - identifying and responding to

risks of material misstatement due to

fraud

Fraud risk assessment

To identify risks of material misstatement

due to fraud (“fraud risks”) we assessed

events or conditions that could indicate an

incentive or pressure to commit fraud or

provide an opportunity to commit fraud. In

this risk assessment we considered the

following:

• Our meetings throughout the year with

the Group Head of Risk, Group Head of

Compliance and Group Head of Legal

and inspection of Barclays’ internal

ethics and compliance reporting

summaries, including those concerning

investigations and regulatory

correspondence;

• Enquiries of operational managers,

internal audit, and the Board Audit

Committee and inspection of policy

documentation as to the Group’s high-

level policies and procedures relating to:

◦ detecting and responding to the risks

of fraud as well as whether they have

knowledge of any actual, suspected or

alleged fraud; and

◦ the internal controls established to

mitigate risks related to fraud,

including the appropriateness and

impact of changes made to these

controls to facilitate remote/hybrid

working;

• The Group’s remuneration policies and

key drivers for remuneration and bonus

levels; and

• Discussions among the engagement

team regarding how and where fraud

might occur in the financial statements

and any potential indicators of fraud.

The engagement team includes audit

partners and staff who have extensive

experience of working with banks, and

this experience was relevant to the

discussion about where fraud risks may

arise. The discussions also involved our

forensic specialists to assist us in

identifying fraud risks based on

discussions of the circumstances of the

Group and Company, including

consideration of fraudulent schemes

that had arisen in similar sectors and

industries.  The forensic specialists

participated in the initial fraud risk

assessment discussions and were

consulted as required where further

guidance was necessary.

Fraud risk communication

We communicated identified fraud risks

throughout the audit team and we

remained alert to any indications of fraud

throughout the audit. This included

communication from the Group to

component audit teams of relevant fraud

risks identified at the Group level.

Fraud risks and our procedures to

address them

We identified four fraud risks which were

communicated to component audit

teams. The nature of these fraud risks is

substantially unchanged from the prior

year. The fraud risks we identified are set

out below:

1. IFRS 9 ECL: Judgemental qualitative

adjustments made to the ECL provision

2. Valuations - risk relating to

unobservable pricing inputs used to

price level 3 fair value instruments

3. Existence and accuracy of unconfirmed

over-the-counter bilateral derivatives

4. The risk of management override of

controls, common with all audits under

ISAs (UK).

As required by auditing standards and

taking into account our overall knowledge

of the control environment, we performed

procedures to address the above risks, the

risk that Group and component

management may be in a position to make

inappropriate accounting entries and the

risk of bias in accounting estimates and

judgements. On this audit, we have not

identified a significant risk of fraud related

to revenue recognition for the Group as a

whole. However, we have identified a fraud

risk in relation to revenue recognition

within some of the individual components.

Our audit procedures included evaluating

the design and implementation and

operating effectiveness of relevant

internal controls, assessing significant

accounting estimates for bias, as well as

substantive procedures to address the

fraud risks.

These procedures also included identifying

journal entries to test based on risk criteria

and comparing the identified entries to

supporting documentation.

Incorporating unpredictability into our audit:

A requirement of the auditing standards is

that we undertake procedures which are

deliberately unexpected and could not

have reasonably been predicted by

Barclays’ management.

As an example, we update our criteria for

selecting journals with a higher risk of

management override for testing each

year so that the selection criteria do not

become predictable. Outside of journals,

for a selection of fair value financial

instruments, we performed intra-month

independent re-pricing to incorporate an

element of unpredictability in our audit

procedures.

Link to key audit matters

Further details of the testing we perform

over the identified fraud risks for ECL and

fair value of financial instruments are

included in the respective key audit

matters sections 4.1 and 4.2 of this report,

as the procedures relating to those

estimates also address the risk of fraud.

Laws and regulations - identifying and

responding to risks of material

misstatement due to non-compliance

with laws and regulations

Risk assessment

We identified areas of laws and regulations

that could reasonably be expected to have

a material effect on the financial

statements. For this risk assessment,

matters considered include the following:

• our general commercial and sector

experience;

• inquiries with the directors and other

management (as required by auditing

standards);

• inspection of the Group’s key regulatory

and legal correspondence;

• inspection of the policies and

procedures regarding compliance with

laws and regulations;

• relevant discussions with the Group’s

external legal counsel;

• relevant discussions with the Group’s

key regulatory supervisors including the

Prudential Regulation Authority,

Financial Conduct Authority, Federal

Reserve Board, Federal Deposit

Insurance Corporation and the Joint

Supervisory Team; and

• the Group’s own assessment of the

risks of non-compliance with laws and

regulations, and the internal controls

established to mitigate these. This

assessment was considered and

approved by the Board.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 407 |
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| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

Our risk assessment also considered

instances of non-compliance with laws and

regulations and enforcement actions

against the Group during the year and

specifically those that could reasonably be

expected to have a material effect on the

financial statements.

As the Group operates in a highly regulated

environment, our assessment of risks of

material misstatement also considered the

control environment, including the Group’s

higher-level procedures for complying with

regulatory requirements.  Our assessment

included inspection of key frameworks,

policies and standards in place,

understanding and evaluating the role of

the compliance function in establishing

these and monitoring compliance and

testing of related controls around

whistleblowing and complaints.

Risk communication

Our identified laws and regulations risks

was communicated throughout our team

and we remained alert to any indications of

non-compliance throughout the audit.

This included communication from the

Group to component audit teams of

relevant laws and regulations identified at

Group level.

Direct laws context and link to audit

The potential effect of these laws and

regulations on the financial statements

varies considerably.

Firstly, the Group is subject to laws and

regulations that directly impact the

financial statements including:

• financial reporting legislation (including

related companies’ legislation);

• distributable profits legislation; and

• taxation legislation (direct and indirect).

We assessed the extent of compliance

with these laws and regulations as part of

our procedures on the related financial

statement items.

Most significant indirect law/

regulation areas

Secondly, the Group is subject to many

other laws and regulations where the

consequences of non-compliance could

have a material effect on amounts or

disclosures in the financial statements, for

instance through the imposition of fines,

remediation payments or litigation, or the

loss of the Group’s permission to operate

in countries where the non-adherence to

laws could prevent trading in such

countries.

We identified the following areas as those

most likely to have such an effect:

• Specific aspects of regulatory capital

and liquidity requirements

• Other banking laws and regulations,

including securities issuance law

• Customer conduct rules

• Money laundering

• Sanctions list and financial crime

• Market abuse regulations

• Certain aspects of companies legislation

recognising the financial and regulated

nature of the Group’s activities.

Auditing standards limit the required audit

procedures to identify non-compliance

with these laws and regulations to enquiry

of the directors and other management

and inspection of regulatory and legal

correspondence, if any. If a breach of

operational regulations is not disclosed to

us or evident from relevant

correspondence, an audit will not detect

that breach.

Audit response

In relation to the legal, competition and

regulatory matters disclosed in note 25 we

performed audit procedures which

included making enquiries of Barclays’

internal counsel and inspection of minutes

of meetings and of regulatory

correspondence. For a subset of these

matters which we deemed to be more

significant we also made enquiries of

external counsel and obtained legal

confirmations from Barclays’ external

counsel.

In respect of regulatory matters relating to

conduct risk as disclosed in note 25 our

procedures included inspection of

regulatory correspondence, independent

enquiry of the Group’s main regulators and

performing audit procedures to respond to

risks of material misstatement identified in

recognised conduct provisions.

Context of the ability of the audit to

detect fraud or breaches of law or

regulation

Owing to the inherent limitations of an

audit, there is an unavoidable risk that we

may not have detected some material

misstatements in the financial statements,

even though we have properly planned and

performed our audit in accordance with

auditing standards.  For example, the

further removed non-compliance with

laws and regulations is from the events and

transactions reflected in the financial

statements, the less likely the inherently

limited procedures required by auditing

standards would identify it.

In addition, as with any audit, there

remained a higher risk of non-detection of

fraud, as these may involve collusion,

forgery, intentional omissions,

misrepresentations, or the override of

internal controls. Our audit procedures are

designed to detect material misstatement.

We are not responsible for preventing

non-compliance or fraud and cannot be

expected to detect non-compliance with

all laws and regulations.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 408 |
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| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

6. Our determination of

materiality

The scope of our audit was influenced by

our application of materiality. We set

quantitative thresholds and overlay

qualitative considerations to help us

determine the scope of our audit and the

nature, timing and extent of our

procedures, and in evaluating the effect of

misstatements, both individually and in the

aggregate, on the financial statements as a

whole.

Materiality for the financial statements

as a whole

2023: £350m 2022: £275m

What we mean

A quantitative reference for the purpose of

planning and performing our audit

Basis for determining materiality and

judgements applied

We have determined overall materiality for

the Barclays PLC Group to be £350m

(FY22: £275m).

We determined that profit before tax (PBT)

remains the key benchmark for the

Barclays PLC Group. We selected PBT as

the benchmark because it is the metric in

the primary statements which best

reflects the focus of the users of the

financial statements. During FY23,

Barclays PLC took actions that resulted in

significant additional costs of £927m in Q4

as disclosed in note 7. These are one-off

costs to help drive future returns. Given

the nature of these costs, we normalised

PBT by adding back these items because

they do not represent the normal,

continuing operations of the Group. As

such, for FY23 we based our Group

materiality on Group normalised PBT of

£7,484m (2022: £7,012m).

Our Group materiality of £350m (2022:

£275m) was determined by applying a

percentage to normalised PBT. When

using a profit-related measure to

determine overall materiality, KPMG’s

approach is to apply a percentage between

3% and 5% to the measure. In setting

overall materiality, we applied a percentage

of 4.7% (2022: 3.9%) of the benchmark.

Materiality for the parent company

financial statements as a whole was set at

£170m (2022: £100m), which is the

component materiality for the parent

company determined by the group audit

engagement team. This is lower than the

materiality we would otherwise have

determined with reference to a benchmark

of net assets of which it represents 0.3%

(FY22: 0.2%).

Performance materiality

2023: £227m 2022: £179m

What we mean

Our procedures on individual account

balances and disclosures were performed

to a lower threshold, performance

materiality, so as to reduce, to an

acceptable level, the risk that individually

immaterial misstatements in individual

account balances add up to a material

amount across the financial statements as

a whole.

Basis for determining performance

materiality and judgements applied

We have considered performance

materiality at a level of 65% (2022: 65%) of

materiality for Barclays PLC Group’s

financial statements as a whole to be

appropriate.

The Parent Company performance

materiality was set at £110m (FY22: £65m)

which equates to 65% (FY22: 65%) of

materiality for the Parent Company

financial statements as a whole.

We applied this percentage in our

determination of performance materiality

based on the level of control deficiencies

during the prior period.

Audit misstatement posting threshold

2023: £17m 2022: £13m

What we mean

This is the amount below which identified

misstatements are considered to be

clearly trivial from a quantitative point of

view. We may become aware of

differences below this threshold which

could alter the nature, timing and scope of

our audit procedures, for example if we

identify smaller differences which are

indicators of fraud.

This is also the amount above which all

differences identified are communicated

to Barclays PLC’s Board Audit Committee.

Basis for determining the audit

misstatement reporting threshold and

judgements applied

The audit misstatement posting threshold

has been set at a level of 5% (2022: 5%) of

materiality for Barclays PLC’s Group

financial statements.

We also report to the Audit Committee

any other identified misstatements that

warrant reporting on qualitative grounds.

The overall materiality for the Group financial statements of £350m (2022: £275m) compares as follows to the other main financial

statement elements amounts.

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| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | Total Revenue | | Total Assets | | Net Assets | |
|  | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
|  | £25,378m | £24,956m | £1,477,487m | £1,513,699m | £71,864m | £69,260m |
| Group Materiality as % of caption | 1.38% | 1.10% | 0.02% | 0.02% | 0.49% | 0.40% |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 409 |
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| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

7. The scope of our audit

Group scope

What we mean

How the Group audit team determined the

procedures to be performed across the

Group.

We have subjected four (2022: four) of the

Group’s components to full scope audits

for Group purposes. Our approach to

scoping the four components was as

follows:

• For two components, Barclays Bank UK

PLC and Barclays Execution Services

Limited Solus, we directly instructed the

component audit teams to conduct and

report to us on full scope audits in 2023

and 2022;

• The third component, Barclays PLC

Solus was subject to a full scope audit by

us in 2023 and 2022; and

• The fourth component, Barclays Bank

PLC sub-group, was subject to a full

scope audit by us in 2023 and 2022, as

detailed below.

In addition, the group has a large number

of other components, and we performed

specified, risk-focused audit procedures

over some account balances selected

from amongst those components. The

components over which we performed

work represented 0.19% (2022: 7.68%) of

Barclays PLC Group’s total income and

0.26% (2022: 0.24%) of the Group’s total

assets.

Within the Barclays Bank PLC sub-group

we specified components as follows:

• Barclays Bank Solus to be subject to a

full scope audit carried out by us in 2023

and 2022;

• Barclays Bank Delaware and Barclays

Capital Inc to be subject to a full scope

audit as instructed by us in 2023 and

2022; and

• Barclays Bank Ireland PLC and Barclays

Capital Securities Limited to be subject

to an audit of certain account balances

as instructed by us in 2023 and 2022.

The components within the scope of our

work accounted for the percentages

illustrated in section 2 – Group scope.

The materiality levels applied to the audits

of the components of Barclays PLC are as

follows:

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Scope | Number of components | Range of materiality applied |
| Full scope audit | 4 | £135m - £230m |

Barclays PLC has centralised certain

Group-wide processes in a shared service

centre in India, the outputs of which are

included in the financial information of the

reporting components it services and

therefore it is not a separate reporting

component. This service centre is subject

to specified audit procedures,

predominantly the testing of transaction

processing, reconciliations and review

controls. Additional procedures are

performed at certain reporting

components to address the audit risks not

covered by the work performed by the

shared service centre.

The Group audit team has also performed

certain audit procedures on the following

areas on behalf of relevant components:

• Testing of IT systems and automated

business controls; and

• Operating expenses and Group

recharges.

The Group team communicated the

results of these procedures to the

applicable component teams.

In addition, we have performed Group level

analysis on the remaining components to

determine whether further risks of material

misstatement exist in those components.

We were able to rely upon the Group's

internal control over financial reporting in

all areas of our audit, and where our

controls testing supported this approach,

which enabled us to reduce the scope of

our substantive audit work.

Group audit team oversight

What we mean

The extent of the Group audit team’s

involvement in component audits.

A hybrid communication and oversight

strategy was implemented between the

Group audit team and the components

during the year.  This included:

• A global planning conference held in

London and led by the Group audit team

to discuss key audit risks and obtain

input from component teams and other

participating locations.

• The components in scope for Group

reporting purposes were either visited

by the Group audit team to assess the

audit risk and strategy, or such review

occurred remotely. Throughout the

audit, we inspected the components’

key working papers to understand and

challenge the audit approach and audit

findings of each component, the

findings reported to the Group team

were discussed in more detail, and any

further work required by the Group team

was then performed by the component

auditors.

• Instructions issued by the Group audit

team to component auditors setting out

the significant areas to be covered,

including the relevant key audit matters

identified above and the information to

be reported back to the Group audit

team. For example, minimum criteria for

high-risk journals were set by the Group

team and applied consistently across

the audit.

• Review and approval by the Group audit

team of the component materiality for

all components.

• Risk assessment and challenge sessions

with each component audit team were

held in the planning, interim and final

phases of the audit, led by the Group

lead engagement partner and audit

quality partner.

• Monthly video conferences with the

partners and directors of the Group and

component audit teams along with

regular ad hoc contact in person and via

video calls and email exchanges to

challenge the component audit

approach and findings.

• Stuart Crisp, the Group Lead

Engagement Partner (and Senior

Statutory Auditor), attended each Board

Audit Committee and Board Risk

Committee for Barclays PLC and

Barclays Bank PLC and at least one

Board Audit Committee for Barclays

Bank UK, Barclays Bank Europe, and the

IHC covering Barclays Capital Inc. and

Barclays Bank Delaware.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 410 |
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| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

8. Other information in

the annual report

The directors are responsible for the other

information presented in the Annual

Report together with the financial

statements.  Our opinion on the financial

statements does not cover the other

information and, accordingly, we do not

express an audit opinion or, except as

explicitly stated below, any form of

assurance conclusion thereon.

All other information

Our responsibility

Our responsibility is to read the other

information and, in doing so, consider

whether, based on our financial

statements audit work, the information

therein is materially misstated or

inconsistent with the financial statements

or our audit knowledge.

Our reporting

Based solely on that work we have not

identified material misstatements or

inconsistencies in the other information.

Strategic report and Directors’ report

Our responsibility and reporting

Based solely on our work on the other

information described above we report to

you as follows:

• we have not identified material

misstatements in the strategic report

and the Directors’ Report;

• in our opinion the information given in

those reports for the financial year is

consistent with the financial statements;

and

• in our opinion those reports have been

prepared in accordance with the

Companies Act 2006.

Directors’ remuneration report

Our responsibility

We are required to form an opinion as to

whether the part of the Directors’

remuneration report to be audited has

been properly prepared in accordance with

the Companies Act 2006.

Our reporting

In our opinion the part of the Directors’

remuneration report to be audited has

been properly prepared in accordance with

the Companies Act 2006.

Corporate governance disclosures

Our responsibility

We are required to perform procedures to

identify whether there is a material

inconsistency between the financial

statements and our audit knowledge, and:

• the directors’ statement that they

consider that the annual report and

financial statements taken as a whole is

fair, balanced and understandable, and

provides the information necessary for

shareholders to assess the Group’s

position and performance, business

model and strategy;

• the section of the annual report

describing the work of the Board Audit

Committee, including the significant

issues that the Board Audit Committee

considered in relation to the financial

statements, and how these issues were

addressed; and

• the section of the annual report that

describes the review of the

effectiveness of the Group’s risk

management and internal control

systems.

Our reporting

Based on those procedures, we have

concluded that each of these disclosures

is materially consistent with the financial

statements and our audit knowledge.

We are also required to review the part of

Corporate Governance Statement relating

to the Group’s compliance with the

provisions of the UK Corporate

Governance Code specified by the Listing

Rules for our review.

We have nothing to report in this respect.

Other matters on which we are required

to report by exception

Our responsibility

Under the Companies Act 2006, we are

required to report to you if, in our opinion:

• adequate accounting records have not

been kept by the Parent Company, or

returns adequate for our audit have not

been received from branches not visited

by us; or

• the Parent Company financial

statements and the part of the

Directors’ remuneration report to be

audited are not in agreement with the

accounting records and returns; or

• certain disclosures of directors’

remuneration specified by law are not

made; or

• we have not received all the information

and explanations we require for our

audit.

Our reporting

We have nothing to report in this respect.

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| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

9. Respective responsibilities

Directors’ responsibilities

As explained more fully in their statement

set out on page 190, the Directors are

responsible for: the preparation of the

financial statements including being

satisfied that they give a true and fair view;

such internal control as they determine is

necessary to enable the preparation of

financial statements that are free from

material misstatement, whether due to

fraud or error; assessing the Group and

Parent Company’s ability to continue as a

going concern, disclosing, as applicable,

matters related to going concern; and

using the going concern basis of

accounting unless they either intend to

liquidate the Group or the parent Company

or to cease operations, or have no realistic

alternative but to do so.

Auditor’s responsibilities

Our objectives are to obtain reasonable

assurance about whether the financial

statements as a whole are free from

material misstatement, whether due to

fraud or error, and to issue our opinion in

an auditor’s report.  Reasonable assurance

is a high level of assurance but does not

guarantee that an audit conducted in

accordance with ISAs (UK) will always

detect a material misstatement when it

exists.  Misstatements can arise from fraud

or error and are considered material if,

individually or in aggregate, they could

reasonably be expected to influence the

economic decisions of users taken on the

basis of the financial statements.

A fuller description of our responsibilities is

provided on the FRC’s website at

[frc.org.uk/auditorsresponsibilities](www.frc.org.uk/auditorsresponsibilitie).

The Company is required to include these

financial statements in an annual financial

report prepared using the single electronic

reporting format specified in the TD ESEF

Regulation.  The auditor’s report provides

no assurance over whether the financial

report has been prepared in accordance

with that format.

10. The purpose of our audit

work and to whom we owe our

responsibilities

This report is made solely to the

Company’s members, as a body, in

accordance with Chapter 3 of Part 16 of

the Companies Act 2006 and the terms of

our engagement by the Company.  Our

audit work has been undertaken so that we

might state to the Company’s members

those matters we are required to state to

them in an auditor’s report and the further

matters we are required to state to them in

accordance with the terms agreed with the

Company, and for no other purpose.  To

the fullest extent permitted by law, we do

not accept or assume responsibility to

anyone other than the Company and the

Company’s members, as a body, for our

audit work, for this report, or for the

opinions we have formed.

Stuart Crisp

(Senior Statutory Auditor)

for and on behalf of KPMG LLP, Statutory

Auditor

Chartered Accountants

15 Canada Square

London

E14 5GL

19 February 2024

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| KPMG LLP’s independent auditor’s report  to the members of Barclays PLC (continued) | | | | | | | | | | |

#### Consolidated

#### income statement

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  | 2023 | 2022 | 2021 |
| For the year ended 31 December | Notes | £m | £m | £m |
| Interest and similar income | 3 | 35,075 | 19,096 | 11,240 |
| Interest and similar expense | 3 | (22,366) | (8,524) | (3,167) |
| Net interest income |  | 12,709 | 10,572 | 8,073 |
| Fee and commission income | 4 | 10,121 | 9,637 | 9,880 |
| Fee and commission expense | 4 | (3,592) | (3,038) | (2,206) |
| Net fee and commission income |  | 6,529 | 6,599 | 7,674 |
| Net trading income | 5 | 5,945 | 8,049 | 5,794 |
| Net investment income/(expense) | 6 | 61 | (434) | 311 |
| Other income |  | 134 | 170 | 88 |
| Total income |  | 25,378 | 24,956 | 21,940 |
| Staff costs | 30 | (10,017) | (9,252) | (8,511) |
| Infrastructure costs | 7 | (4,095) | (3,435) | (3,614) |
| Administration and general expenses | 7 | (2,782) | (2,446) | (2,137) |
| Litigation and conduct | 7 | (37) | (1,597) | (397) |
| Operating expenses | 7 | (16,931) | (16,730) | (14,659) |
| Share of post-tax results of associates and joint ventures |  | (9) | 6 | 260 |
| Profit before impairment |  | 8,438 | 8,232 | 7,541 |
| Credit impairment (charges)/releases | 8 | (1,881) | (1,220) | 653 |
| Profit before tax |  | 6,557 | 7,012 | 8,194 |
| Taxation | 9 | (1,234) | (1,039) | (1,138) |
| Profit after tax |  | 5,323 | 5,973 | 7,056 |
|  |  |  |  |  |
| Attributable to: |  |  |  |  |
| Equity holders of the parent |  | 4,274 | 5,023 | 6,205 |
| Other equity instrument holders |  | 985 | 905 | 804 |
| Total equity holders of the parent |  | 5,259 | 5,928 | 7,009 |
| Non-controlling interests | 29 | 64 | 45 | 47 |
| Profit after tax |  | 5,323 | 5,973 | 7,056 |
|  |  |  |  |  |
| Earnings per share |  | p | p | p |
| Basic earnings per ordinary share | 10 | 27.7 | 30.8 | 36.5 |
| Diluted earnings per share | 10 | 26.9 | 29.8 | 35.6 |

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 413 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Consolidated financial statements | | | | | | | | | | |

#### Consolidated statement of comprehensive income

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
| For the year ended 31 December | £m | £m | £m |
| Profit after tax | 5,323 | 5,973 | 7,056 |
|  |  |  |  |
| Other comprehensive income/(loss) that may be recycled to profit or loss: |  |  |  |
| Currency translation reserve |  |  |  |
| Currency translation differences1 | (1,110) | 2,032 | (131) |
| Tax | 9 | — | — |
| Fair value through other comprehensive income reserve movements relating to debt securities |  |  |  |
| Net gains/(losses) from changes in fair value | 1,486 | (7,516) | (1,668) |
| Net (gains)/losses transferred to net profit on disposal | (26) | 111 | (305) |
| Net (gains)/losses relating to (releases of) impairment | (1) | 9 | (8) |
| Net (losses)/gains due to fair value hedging | (1,184) | 5,452 | 1,354 |
| Tax | (78) | 523 | 198 |
| Cash flow hedging reserve |  |  |  |
| Net gains/(losses) from changes in fair value | 4,447 | (9,052) | (2,280) |
| Net losses/(gains) transferred to net profit | 423 | 339 | (1,173) |
| Tax | (1,342) | 2,331 | 1,025 |
| Other comprehensive income/(loss) that may be recycled to profit or loss | 2,624 | (5,771) | (2,988) |
|  |  |  |  |
| Other comprehensive income/(loss) not recycled to profit or loss: |  |  |  |
| Retirement benefit remeasurements | (1,193) | (754) | 1,298 |
| Fair value through other comprehensive income reserve movements relating to equity instruments | (3) | 228 | 141 |
| Own credit | (983) | 2,092 | (106) |
| Tax | 611 | (156) | (563) |
| Other comprehensive (loss)/income not recycled to profit or loss | (1,568) | 1,410 | 770 |
|  |  |  |  |
| Other comprehensive income/(loss) for the year | 1,056 | (4,361) | (2,218) |
|  |  |  |  |
| Total comprehensive income for the year | 6,379 | 1,612 | 4,838 |
|  |  |  |  |
| Attributable to: |  |  |  |
| Equity holders of the parent | 6,315 | 1,567 | 4,791 |
| Non-controlling interests | 64 | 45 | 47 |
| Total comprehensive income for the year | 6,379 | 1,612 | 4,838 |

Note

1 Includes nil gain (2022:  £1m gain;  2021 :  £26m  loss ) on recycling of currency translation differences to net profit.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 414 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Consolidated financial statements (continued) | | | | | | | | | | |

#### Consolidated balance sheet

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  | 2023 | 2022 |
| As at 31 December | Notes | £m | £m |
| Assets |  |  |  |
| Cash and balances at central banks |  | 224,634 | 256,351 |
| Cash collateral and settlement balances |  | 108,889 | 112,597 |
| Debt securities at amortised cost |  | 56,749 | 45,487 |
| Loans and advances at amortised cost to banks |  | 9,459 | 10,015 |
| Loans and advances at amortised cost to customers |  | 333,288 | 343,277 |
| Reverse repurchase agreements and other similar secured lending at amortised cost |  | 2,594 | 776 |
| Trading portfolio assets | 12 | 174,605 | 133,813 |
| Financial assets at fair value through the income statement | 13 | 206,651 | 213,568 |
| Derivative financial instruments | 14 | 256,836 | 302,380 |
| Financial assets at fair value through other comprehensive income | 15 | 71,836 | 65,062 |
| Investments in associates and joint ventures | 35 | 879 | 922 |
| Goodwill and intangible assets | 21 | 7,794 | 8,239 |
| Property, plant and equipment | 19 | 3,417 | 3,616 |
| Current tax assets |  | 121 | 385 |
| Deferred tax assets | 9 | 5,960 | 6,991 |
| Retirement benefit assets | 32 | 3,667 | 4,743 |
| Assets included in disposal group classified as held for sale | 40 | 3,916 | — |
| Other assets |  | 6,192 | 5,477 |
| Total assets |  | 1,477,487 | 1,513,699 |
| Liabilities |  |  |  |
| Deposits at amortised cost from banks |  | 14,472 | 19,979 |
| Deposits at amortised cost from customers |  | 524,317 | 525,803 |
| Cash collateral and settlement balances |  | 94,084 | 96,927 |
| Repurchase agreements and other similar secured borrowing at amortised cost |  | 41,601 | 27,052 |
| Debt securities in issue |  | 96,825 | 112,881 |
| Subordinated liabilities | 26 | 10,494 | 11,423 |
| Trading portfolio liabilities | 12 | 58,669 | 72,924 |
| Financial liabilities designated at fair value | 16 | 297,539 | 271,637 |
| Derivative financial instruments | 14 | 250,044 | 289,620 |
| Current tax liabilities |  | 529 | 580 |
| Deferred tax liabilities | 9 | 22 | 16 |
| Retirement benefit liabilities | 32 | 266 | 264 |
| Provisions | 23 | 1,584 | 1,544 |
| Liabilities included in disposal group classified as held for sale | 40 | 3,164 | — |
| Other liabilities | 22 | 12,013 | 13,789 |
| Total liabilities |  | 1,405,623 | 1,444,439 |
| Equity |  |  |  |
| Called up share capital and share premium | 27 | 4,288 | 4,373 |
| Other equity instruments | 27 | 13,259 | 13,284 |
| Other reserves | 28 | (77) | (2,192) |
| Retained earnings |  | 53,734 | 52,827 |
| Total equity excluding non-controlling interests |  | 71,204 | 68,292 |
| Non-controlling interests | 29 | 660 | 968 |
| Total equity |  | 71,864 | 69,260 |
| Total liabilities and equity |  | 1,477,487 | 1,513,699 |

The Board of Directors approved the financial statements on pages  [413](#i79b760f6e6214db0b07586e041f3c122_223) to [508](#i55e90031d46c488c8dd56d5c493e30f6_44744)  on 19 February 2024.

Nigel Higgins

Group Chairman

C.S. Venkatakrishnan

Group Chief Executive

Anna Cross

Group Finance Director

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| Consolidated financial statements (continued) | | | | | | | | | | |

#### Consolidated statement of changes in equity

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | Called up share  capital and share  premium1 | Other equity  instruments 1 | Other reserves2 | Retained  earnings | Total equity  excluding non-  controlling  interests | Non-controlling  interests | Total equity |
|  | £m | £m | £m | £m | £m | £m | £m |
| Balance as at 1 January 2023 | 4,373 | 13,284 | (2,192) | 52,827 | 68,292 | 968 | 69,260 |
| Profit after tax | — | 985 | — | 4,274 | 5,259 | 64 | 5,323 |
| Currency translation movements | — | — | (1,101) | — | (1,101) | — | (1,101) |
| Fair value through other comprehensive  income reserve | — | — | 194 | — | 194 | — | 194 |
| Cash flow hedges | — | — | 3,528 | — | 3,528 | — | 3,528 |
| Retirement benefit remeasurements | — | — | — | (855) | (855) | — | (855) |
| Own credit reserve | — | — | (710) | — | (710) | — | (710) |
| Total comprehensive income for the year | — | 985 | 1,911 | 3,419 | 6,315 | 64 | 6,379 |
| Employee share schemes and hedging  thereof | 124 | — | — | 497 | 621 | — | 621 |
| Issue and redemption of other equity  instruments | — | (30) | — | (38) | (68) | (312) | (380) |
| Other equity instruments coupons paid | — | (985) | — | — | (985) | — | (985) |
| Increase in treasury shares | — | — | (285) | — | (285) | — | (285) |
| Vesting of shares under employee share  schemes | — | — | 277 | (506) | (229) | — | (229) |
| Dividends paid | — | — | — | (1,210) | (1,210) | (64) | (1,274) |
| Repurchase of shares | (209) | — | 209 | (1,257) | (1,257) | — | (1,257) |
| Other reserve movements | — | 5 | 3 | 2 | 10 | 4 | 14 |
| Balance as at 31 December 2023 | 4,288 | 13,259 | (77) | 53,734 | 71,204 | 660 | 71,864 |
|  |  |  |  |  |  |  |  |
| Balance as at 1 January 2022 | 4,536 | 12,259 | 1,770 | 50,487 | 69,052 | 989 | 70,041 |
| Profit after tax | — | 905 | — | 5,023 | 5,928 | 45 | 5,973 |
| Currency translation movements | — | — | 2,032 | — | 2,032 | — | 2,032 |
| Fair value through other comprehensive  income reserve | — | — | (1,193) | — | (1,193) | — | (1,193) |
| Cash flow hedges | — | — | (6,382) | — | (6,382) | — | (6,382) |
| Retirement benefit remeasurements | — | — | — | (281) | (281) | — | (281) |
| Own credit reserve | — | — | 1,463 | — | 1,463 | — | 1,463 |
| Total comprehensive income for the year | — | 905 | (4,080) | 4,742 | 1,567 | 45 | 1,612 |
| Employee share schemes and hedging  thereof | 70 | — | — | 476 | 546 | — | 546 |
| Issue and redemption of other equity  instruments | — | 1,032 | — | 28 | 1,060 | (20) | 1,040 |
| Other equity instruments coupons paid | — | (905) | — | — | (905) | — | (905) |
| Disposal of Absa holding | — | — | (84) | 84 | — | — | — |
| Increase in treasury shares | — | — | (248) | — | (248) | — | (248) |
| Vesting of shares under employee share  schemes | — | — | 253 | (485) | (232) | — | (232) |
| Dividends paid | — | — | — | (1,028) | (1,028) | (45) | (1,073) |
| Repurchase of shares | (233) | — | 233 | (1,508) | (1,508) | — | (1,508) |
| Own credit realisation | — | — | (36) | 36 | — | — | — |
| Other reserve movements | — | (7) | — | (5) | (12) | (1) | (13) |
| Balance as at 31 December 2022 | 4,373 | 13,284 | (2,192) | 52,827 | 68,292 | 968 | 69,260 |

Notes

1 For further details refer to Note 27.

2 For further details refer to Note 28.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 416 |
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| Consolidated financial statements (continued) | | | | | | | | | | |

#### Consolidated cash flow statement

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  | 2023 | 2022 | 2021 |
| For the year ended 31 December | Notes | £m | £m | £m |
| Reconciliation of profit before tax to net cash flows from operating activities: |  |  |  |  |
| Profit before tax |  | 6,557 | 7,012 | 8,194 |
| Adjustment for non-cash items: |  |  |  |  |
| Credit impairment charges/(releases) |  | 1,881 | 1,220 | (653) |
| Depreciation, amortisation and impairment of property, plant, equipment and intangibles |  | 2,147 | 1,786 | 2,076 |
| Other provisions, including pensions |  | 482 | 1,724 | 468 |
| Net loss on disposal of investments and property, plant and equipment |  | 11 | 54 | 39 |
| Other non-cash movements including exchange rate movements |  | 10,729 | (13,298) | 3,093 |
| Changes in operating assets and liabilities |  |  |  |  |
| Net decrease/(increase) in cash collateral and settlement balances |  | 1,165 | (881) | 4,101 |
| Net decrease/(increase) in loans and advances at amortised cost |  | 10,947 | (24,949) | (10,728) |
| Net (increase)/decrease in reverse repurchase agreements and other similar secured lending |  | (1,818) | 2,451 | 5,804 |
| Net (decrease)/increase in deposits at amortised cost |  | (6,958) | 26,349 | 38,397 |
| Net (decrease)/increase in debt securities in issue |  | (19,640) | 9,210 | 18,131 |
| Net increase/(decrease) in repurchase agreements and other similar secured borrowing |  | 14,549 | (1,300) | 14,178 |
| Net decrease/(increase) in derivative financial instruments |  | 5,968 | (7,071) | (4,018) |
| Net (increase)/decrease in trading portfolio assets |  | (40,792) | 13,222 | (19,085) |
| Net (decrease)/increase in trading portfolio liabilities |  | (14,255) | 18,755 | 6,764 |
| Net (decrease)/increase in financial assets and liabilities at fair value through the income statement |  | 32,819 | (919) | (15,626) |
| Net increase in other assets |  | (1,521) | (3,497) | (2,133) |
| Net (decrease)/increase in other liabilities |  | (2,362) | 1,051 | 1,252 |
| Corporate income tax paid |  | (836) | (688) | (1,335) |
| Net cash from operating activities |  | (927) | 30,231 | 48,919 |
| Purchase of debt securities at amortised cost |  | (19,977) | (27,731) | (12,500) |
| Proceeds from redemption or sale of debt securities at amortised cost |  | 7,332 | 14,277 | 3,757 |
| Purchase of financial assets at fair value through other comprehensive income |  | (66,415) | (69,380) | (75,673) |
| Proceeds from sale or redemption of financial assets at fair value through other comprehensive income |  | 59,756 | 62,821 | 89,342 |
| Purchase of property, plant and equipment and intangibles |  | (1,718) | (1,746) | (1,720) |
| (Acquisition of business)/Disposal of subsidiary net of cash disposed |  | (2,415) | — | 1,057 |
| Other cash flows associated with investing activities |  | 23 | 86 | 7 |
| Net cash from investing activities |  | (23,414) | (21,673) | 4,270 |
| Dividends paid and other coupon payments on equity instruments |  | (2,259) | (1,978) | (1,360) |
| Issuance of subordinated liabilities | 26 | 1,523 | 1,477 | 1,890 |
| Redemption of subordinated liabilities | 26 | (2,239) | (2,679) | (4,807) |
| Issue of shares and other equity instruments |  | 3,251 | 3,205 | 1,118 |
| Repurchase of shares and other equity instruments |  | (4,750) | (3,655) | (1,275) |
| Issuance of debt securities1 |  | 9,836 | 11,139 | 8,415 |
| Redemption of debt securities1 |  | (6,252) | (6,335) | (3,475) |
| Net purchase of treasury shares |  | (499) | (478) | (399) |
| Net cash from financing activities |  | (1,389) | 696 | 107 |
| Effect of exchange rates on cash and cash equivalents |  | (5,053) | 10,330 | (4,232) |
| Net (decrease)/increase in cash and cash equivalents |  | (30,783) | 19,584 | 49,064 |
| Cash and cash equivalents at beginning of year |  | 278,790 | 259,206 | 210,142 |
| Cash and cash equivalents at end of year |  | 248,007 | 278,790 | 259,206 |
| Cash and cash equivalents comprise: |  |  |  |  |
| Cash and balances at central banks |  | 224,634 | 256,351 | 238,574 |
| Loans and advances to banks with original maturity less than three months |  | 6,639 | 6,431 | 6,488 |
| Cash collateral balances with central banks with original maturity less than three months |  | 15,450 | 15,150 | 13,532 |
| Treasury and other eligible bills with original maturity less than three months |  | 1,284 | 858 | 612 |
| Cash and cash equivalents at end of year |  | 248,007 | 278,790 | 259,206 |

Note

1 Issuance of debt securities and Redemption of debt securities included in financing activities relate to instruments that qualify as eligible liabilities and satisfy regulatory requirements for

MREL instruments which came into effect during 2019.  Refer to Note 1, paragraph 4(vi), for further details.

Interest received was   £62,298m  (2022: £40,975m ; 2021:  £17,194m) and interest paid was £48,246m (2022: £28,709m; 2021: £8,063m).  These amounts include interest paid and received

arising from trading activities. Dividends received were £0m (2022: £31m; 2021: £20m ). The Group is required to maintain balances with central banks and other regulatory authorities.

These amounted to £3,758m (2022: £3,457m; 2021: £4,750m ) and are included within the Cash and cash equivalents. For the purposes of the cash flow statement, cash comprises cash on

hand and demand deposits and cash equivalents comprise highly liquid investments that are convertible into cash with an insignificant risk of changes in value with original maturities of

three months or less. Repurchase and reverse repurchase agreements are not considered to be part of cash equivalents.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 417 |
|  |  |
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| Consolidated financial statements (continued) | | | | | | | | | | |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Statement of comprehensive income |  |  |  |  |
|  |  | 2023 | 2022 | 2021 |
| For the year ended 31 December | Notes | £m | £m | £m |
| Dividend received from subsidiaries | 42 | 2,818 | 2,797 | 1,356 |
| Net interest expense |  | (11) | (163) | (161) |
| Other  income/ (expense) | 42 | 1,174 | (654) | 659 |
| Impairment reversal of investment in subsidiary | 42 | — | — | 2,573 |
| Operating expenses |  | (296) | (257) | (160) |
| Profit  before tax |  | 3,685 | 1,723 | 4,267 |
| Taxation |  | 81 | 440 | 76 |
| Profit  after tax |  | 3,766 | 2,163 | 4,343 |
| Other comprehensive income |  | — | — | — |
| Total comprehensive income |  | 3,766 | 2,163 | 4,343 |
| Profit after tax attributable to: |  |  |  |  |
| Ordinary equity holders |  | 2,781 | 1,258 | 3,539 |
| Other equity instrument holders |  | 985 | 905 | 804 |
| Profit  after tax |  | 3,766 | 2,163 | 4,343 |
| Total comprehensive income attributable to: |  |  |  |  |
| Ordinary equity holders |  | 2,781 | 1,258 | 3,539 |
| Other equity instrument holders |  | 985 | 905 | 804 |
| Total comprehensive income |  | 3,766 | 2,163 | 4,343 |

For the year ended 31 December  2023, profit after tax was £ 3,766m ( 2022 : £2,163 m, 2021:  £4,343m) and total comprehensive income

was £ 3,766m ( 2022: £ 2,163 m, 2021:  £4,343m).   The Company has 61  members of staff ( 2022:  61, 2021: 65).

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Balance sheet |  |  |  |
|  |  | 2023 | 2022 |
| As at 31 December | Notes | £m | £m |
| Assets |  |  |  |
| Investment in subsidiaries | 42 | 64,461 | 64,544 |
| Loans and advances to subsidiaries | 42 | 18,926 | 23,628 |
| Financial assets at fair value through the income statement | 42 | 35,787 | 28,930 |
| Derivative financial instruments |  | 33 | 31 |
| Other assets |  | 407 | 402 |
| Total assets |  | 119,614 | 117,535 |
| Liabilities |  |  |  |
| Deposits at amortised cost |  | 542 | 544 |
| Debt securities in issue | 42 | 18,308 | 24,086 |
| Subordinated liabilities | 42 | 10,018 | 11,230 |
| Financial liabilities designated at fair value | 42 | 31,832 | 22,971 |
| Derivative financial instruments | 42 | 711 | 906 |
| Other liabilities |  | 175 | 131 |
| Total liabilities |  | 61,586 | 59,868 |
| Equity |  |  |  |
| Called up share capital | 42 | 3,789 | 3,968 |
| Share premium account | 42 | 499 | 405 |
| Other equity instruments | 42 | 13,198 | 13,250 |
| Other reserves |  | 997 | 788 |
| Retained earnings |  | 39,545 | 39,256 |
| Total equity |  | 58,028 | 57,667 |
| Total liabilities and equity |  | 119,614 | 117,535 |

The financial statements on pages  [418](#i8486bd072188400a834137e67132c305_450) to  [420](#ie6ba42ff4f714d5f84a57b37649104f5_421)  and the accompanying note on page  [503](#i4be61753b7f243b19551b0bfbf3a2a0d_1042)  were approved by the Board of Directors on 19

February 2024  and signed on its behalf by:

Nigel Higgins

Group Chairman

C.S.Venkatakrishnan

Group Chief Executive

Anna Cross

Group Finance Director

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| Parent company accounts | | | | | | | | | | |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Statement of changes in equity |  |  |  |  |  |
|  | Called up share  capital and share  premium | Other equity  instruments | Other reserves | Retained earnings | Total equity |
|  | £m | £m | £m | £m | £m |
| Balance as at 1 January 2023 | 4,373 | 13,250 | 788 | 39,256 | 57,667 |
| Profit after tax and other comprehensive income | — | 985 | — | 2,781 | 3,766 |
| Issue of shares under employee share schemes | 124 | — | — | 22 | 146 |
| Issue and exchange of other equity instruments | — | (52) | — | (25) | (77) |
| Vesting of shares under employee share schemes | — | — | — | (22) | (22) |
| Dividends paid | — | — | — | (1,210) | (1,210) |
| Other equity instruments coupons paid | — | (985) | — | — | (985) |
| Repurchase of shares | (209) | — | 209 | (1,257) | (1,257) |
| Balance as at 31 December 2023 | 4,288 | 13,198 | 997 | 39,545 | 58,028 |
| Balance as at 1 January 2022 | 4,536 | 12,241 | 555 | 40,505 | 57,837 |
| Profit after tax and other comprehensive income | — | 905 | — | 1,258 | 2,163 |
| Issue of shares under employee share schemes | 70 | — | — | 34 | 104 |
| Issue and exchange of other equity instruments | — | 1,009 | — | 17 | 1,026 |
| Vesting of shares under employee share schemes | — | — | — | (22) | (22) |
| Dividends paid | — | — | — | (1,028) | (1,028) |
| Other equity instruments coupons paid | — | (905) | — | — | (905) |
| Repurchase of shares | (233) | — | 233 | (1,508) | (1,508) |
| Balance as at 31 December 2022 | 4,373 | 13,250 | 788 | 39,256 | 57,667 |

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| Parent company accounts (continued) | | | | | | | | | | |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Cash flow statement |  |  |  |
|  | 2023 | 2022 | 2021 |
| For the year ended 31 December | £m | £m | £m |
| Reconciliation of profit before tax to net cash flows from operating activities: |  |  |  |
| Profit before tax | 3,685 | 1,723 | 4,267 |
| Adjustment for non-cash items: |  |  |  |
| Reversal of impairment of subsidiary | — | — | (2,573) |
| Other non-cash items | (627) | 868 | 383 |
| Changes in operating assets and liabilities | 17 | 1,037 | 17 |
| Net cash generated from operating activities | 3,075 | 3,628 | 2,094 |
| Net increase in loans and advances to subsidiaries of the parent1 | (2,587) | (5,087) | (6,118) |
| Capital contribution to and investment in subsidiary | 83 | (1,769) | (1,083) |
| Net cash used in investing activities | (2,504) | (6,856) | (7,201) |
| Issue of shares and other equity instruments | 3,251 | 3,180 | 1,114 |
| Redemption of other equity instruments | (3,181) | (2,097) | — |
| Net increase in debt securities in issue2 | 3,585 | 4,813 | 4,939 |
| Proceeds of borrowings and issuance of subordinated debt | (764) | 1,000 | 1,579 |
| Repurchase of shares | (1,257) | (1,508) | (1,200) |
| Dividends paid | (1,210) | (1,028) | (512) |
| Coupons paid on other equity instruments | (985) | (905) | (804) |
| Net cash (used in)/generated from financing activities | (561) | 3,455 | 5,116 |
| Net increase in cash equivalents | 10 | 227 | 9 |
| Cash equivalents at beginning of year | 476 | 249 | 240 |
| Cash equivalents at end of year3 | 486 | 476 | 249 |
|  |  |  |  |
| Net cash generated from operating activities includes: |  |  |  |
| Dividends received | 2,818 | 2,797 | 1,356 |
| Net interest paid | (11) | (163) | (161) |

Notes

1 Includes financial assets at fair value through the income statement .

2 Includes financial liabilities designated at fair value.

3 Cash equivalents comprise loans and advances to banks with original maturity of three months or less, contained within loans and advances to subsidiaries.

The  Parent company’s principal activity is to hold the investment in its wholly-owned subsidiaries, Barclays Bank PLC, Barclays Bank UK

PLC, Barclays Execution Services Limited and Barclays Principal Investments Limited. Dividends received are treated as operating

income.

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| Parent company accounts (continued) | | | | | | | | | | |

This section describes the Group’s material policies and critical accounting estimates that relate to the financial statements and notes

as a whole. If an accounting policy or a critical accounting estimate relates to a particular note, the accounting policy and/or critical

accounting estimate is contained with the relevant note.

1  Material accounting policies

1. Reporting entity

Barclays PLC  is a  public company limited by shares  registered in  England  under company number 48839, having its registered office at  1

Churchill Place, London, E14 5HP.

These financial statements are prepared for Barclays PLC and its subsidiaries (the Group) under Section 399 of the Companies Act

2006. The Group is a major global financial services provider engaged in retail banking, credit cards, wholesale banking, investment

banking, wealth management and investment management services. In addition, separate financial statements have been presented

for the holding company.

2.  Compliance with International Financial Reporting Standards

The consolidated financial statements of the Group, and the separate financial statements of Barclays PLC, have been prepared in

accordance with UK-adopted international accounting standards.

The consolidated financial statements of the Group, and the separate financial statements of Barclays PLC, have also been prepared in

accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB),

including interpretations issued by the IFRS Interpretations Committee, as there are no applicable differences from IFRS as issued by

the IASB for the periods presented.

The principal accounting policies applied in the preparation of the consolidated and separate financial statements are set out below, and

in the relevant notes to the financial statements. These policies have been consistently applied, with the exception of International Tax

Reform-Pillar Two Model Rules (Amendments to IAS 12), which is effective from 1 January 2023 and applies retrospectively; and the

Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2), and Definition of an Accounting Estimate

(Amendments to IAS 8) which were applied from 1 January 2023.

3. Basis of preparation

The consolidated and separate financial statements have been prepared under the historical cost convention modified to include the

fair valuation of investment property, and particular financial instruments, to the extent required or permitted under IFRS as set out in

the relevant accounting policies.  These financial statements are stated in millions of Pounds Sterling (£m), the functional currency of

Barclays PLC.

The financial statements have been prepared for Barclays PLC and its subsidiaries (the Group) under Section 399 of the Companies Act

2006 as applicable to companies using IFRS. The financial statements are prepared on a going concern basis, as the Board is satisfied

that the Group and the parent company have the resources to continue in business for a period of at least 12 months from approval of

the financial statements.

In making this assessment, the Board has considered a wide range of information relating to present and future conditions and includes

a review of a working capital report (WCR). The WCR is used by the Board to assess the future performance of the Group and that it has

the resources in place that are required to meet its ongoing regulatory requirements. The assessment is based upon business plans

which contain future projections of profitability taken from the Group’s medium-term plan as well as projections of regulatory capital

requirements and business funding needs. The WCR also includes an assessment of the impact of internally generated stress testing

scenarios on the liquidity and capital requirement forecasts. The stress tests used were based upon an assessment of reasonably

possible downside economic scenarios that the Group could experience.  Further details are set out in the Viability statement on

page [54](#i4be61753b7f243b19551b0bfbf3a2a0d_214).

The WCR showed that the Group had sufficient capital and liquidity in place to support its future business requirements and remained

above its regulatory minimum requirements in the stress scenarios. Accordingly, the Directors concluded that there was a reasonable

expectation that the Group and parent company has adequate resources to continue as a going concern for a period of at least 12

months from the date of approval of the financial statements.

4. Accounting policies

The Group prepares financial statements in accordance with IFRS. The Group’s material accounting policies relating to specific financial

statement items, together with a description of the accounting estimates and judgements that were critical to preparing those items,

are set out under the relevant notes. Accounting policies that affect the financial statements as a whole are set out below.

(i) Consolidation

The consolidated financial statements combine the financial statements of Barclays PLC and all its subsidiaries. Subsidiaries are entities

over which Barclays PLC has control. The Group has control over another entity when the Group has all of the following:

1) power over the relevant activities of the investee, for example through voting or other rights

2) exposure to, or rights to, variable returns from its involvement with the investee, and

3) the ability to affect those returns through its power over the investee.

As the consolidated financial statements include partnerships where the Group member is a partner, advantage has been taken of the

exemption under Regulation 7 of the Partnership (Accounts) Regulations 2008 with regard to preparing and filing of individual

partnership financial statements.

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| Notes to the financial statements | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

Details of the principal subsidiaries are given in  Note 33.

(ii) Foreign currency translation

Transactions in foreign currencies are translated into Sterling at the rate ruling on the date of the transaction. Foreign currency

monetary balances are translated into Sterling at the period end exchange rates. Exchange gains and losses on such balances are taken

to the income statement.

The Group’s foreign operations (including subsidiaries, joint ventures, associates and branches) based mainly outside the UK may have

different functional currencies. The functional currency of an operation is the currency of the main economy to which it is exposed.

Prior to consolidation (or equity accounting) the assets and liabilities of non-Sterling operations are translated at the period end

exchange rate and items of income, expense and other comprehensive income are translated into Sterling at the rate on the date of

the transactions. Exchange differences arising on the translation of foreign operations are included in currency translation reserves

within equity. These are transferred to the income statement when the Group disposes of the entire interest in a foreign operation,

when partial disposal results in the loss of control of an interest in a subsidiary, when an investment previously accounted for using the

equity method is accounted for as a financial asset, or on the disposal of a foreign operation within a branch.

(iii) Financial assets and liabilities

Recognition

The Group recognises financial assets and liabilities when it becomes a party to the terms of the contract. Trade date or settlement

date accounting is applied depending on the classification of the financial asset.

Classification and measurement

Financial assets are classified on the basis of two criteria:

i) the business model within which financial assets are managed, and

ii) their contractual cash flow characteristics (whether the cash flows represent ‘solely payments of principal and interest’ (SPPI)).

The Group assesses the business model criteria at a portfolio level. Information that is considered in determining the applicable

business model includes (i) policies and objectives for the relevant portfolio, (ii) how the performance and risks of the portfolio are

managed, evaluated and reported to management, and (iii) the frequency, volume and timing of sales in prior periods, sales expectation

for future periods, and the reasons for such sales.

The contractual cash flow characteristics of financial assets are assessed with reference to whether the cash flows represent SPPI.

Terms that could change the contractual cash flows so that it would not meet the condition for SPPI are considered, including: (i)

contingent and leverage features, (ii) non-recourse arrangements, (iii) features that could modify the time value of money, and (iv)

Social, Environmental and Sustainability-linked features. Terms with de minimis impact do not preclude cash flows from representing

SPPI.

The accounting policy for each type of financial asset or liability is included within the relevant note for the item. The Group’s policies for

determining the fair values of the assets and liabilities are set out in Note 17.

Derecognition

The Group derecognises a financial asset, or a portion of a financial asset, from its balance sheet where (i) the contractual rights to cash

flows from the asset have expired, or (ii) the contractual rights to cash flows from the asset have been transferred (usually by sale) and

with them either (a) substantially all the risks and rewards of the asset have been transferred, or (b) where neither substantially all the

risks and reward have been transferred or retained, where control over the asset has been lost.

Financial liabilities are derecognised when the liability has been settled, has expired or has been extinguished. An exchange of an existing

financial liability for a new liability with the same lender on substantially different terms – generally a difference of 10% or more in the

present value of the cash flows or a substantive qualitative amendment – is accounted for as an extinguishment of the original financial

liability and the recognition of a new financial liability.

It may not be obvious whether substantially all of the risks and rewards of a transferred asset, or portion of an asset, have been

transferred. It is often necessary to perform a quantitative analysis that compares the Group's exposure to variability in asset cash flows

before the transfer with its retained exposure after the transfer. A cash flow analysis of this nature may require judgement. In particular,

it is necessary to estimate the asset’s expected future cash flows as well as potential variability around this expectation. The method of

estimating expected future cash flows depends on the nature of the asset, with market and market-implied data used to the greatest

extent possible. The potential variability around this expectation is typically determined by stressing underlying parameters to create

reasonable alternative upside and downside scenarios. Probabilities are then assigned to each scenario. Stressed parameters may

include default rates, loss severity, or prepayment rates.

Accounting for reverse repurchase and repurchase agreements including other similar lending and borrowing

Reverse repurchase agreements (and stock borrowing or similar transactions) are a form of secured lending whereby the Group

provides a loan or cash collateral in exchange for the transfer of collateral, generally in the form of marketable securities subject to an

agreement to transfer the securities back at a fixed price in the future. Repurchase agreements are where the Group obtains such loans

or cash collateral, in exchange for the transfer of collateral.

The Group purchases (a reverse repurchase agreement) or borrows securities subject to a commitment to resell or return them. The

securities are not included in the balance sheet as the Group does not acquire the risks and rewards of ownership. Consideration paid

(or cash collateral provided) is accounted for as a loan asset at amortised cost, unless it is designated or mandatorily at fair value

through profit and loss.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

The Group may also sell (a repurchase agreement) or lend securities subject to a commitment to repurchase or redeem them. The

securities are retained on the balance sheet as the Group retains substantially all the risks and rewards of ownership. Consideration

received (or cash collateral provided) is accounted for as a financial liability at amortised cost, unless it is designated at fair value through

profit and loss.

(iv) Issued debt and equity instruments

Issued financial instruments or their components are classified as liabilities if the contractual arrangement results in the Group having an

obligation to either deliver cash or another financial asset, or a variable number of equity shares, to the holder of the instrument. If this is

not the case, the instrument is generally an equity instrument and the proceeds included in equity, net of transaction costs. Dividends

and other returns to equity holders are recognised when paid or declared by the members at the Annual General Meeting and treated

as a deduction from equity.

Where issued financial instruments contain both liability and equity components, these are accounted for separately. The fair value of

the debt is estimated first and the balance of the proceeds is included within equity.

(v) Cash flow statement

Cash comprises cash on hand and balances at central banks. Cash equivalents comprise loans and advances to banks, cash collateral

balances with central banks related to payment schemes and treasury and other eligible bills, all with original maturities of three months

or less.

Investments in debt securities at amortised cost, presented within loans and advances on the balance sheet, are deemed to be

investing activities for the purposes of the cash flow statement, except those instruments considered to be cash equivalents.

Debt securities issued and redeemed are considered to be operating activities, except qualifying eligible liabilities that satisfy regulatory

requirements for MREL instruments (or have previously satisfied these requirements since 2019 when they came into effect), which are

considered to be financing activities.

5. New and amended standards and interpretations

The accounting policies adopted  have been consistently applied, with the exception of the following:

International Tax Reform—Pillar Two Model Rules (Amendments to IAS 12)

On 23 May 2023, the IASB issued amendments to IAS 12 to provide a mandatory temporary exemption to the requirements to account

for deferred taxes assets and liabilities related to Pillar Two income taxes, as published by the Organisation for Economic Co-operation

and Development (OECD).

The amendments are effective for accounting periods beginning on or after 1 January 2023 and the mandatory temporary exemption

is applied retrospectively to prior periods.

Disclosures related to the amendments are made in Note 9 on page [434](#i4be61753b7f243b19551b0bfbf3a2a0d_937).

Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2)

The amendments require entities to disclose their material rather than their significant accounting policies.  The Group adopted the

amendments effective 1 January 2023.  Whilst these amendments do not change the Group’s accounting policies, the Group has

reviewed the accounting policy information disclosed in these financial statements against the new requirements.

Under the amendments, accounting policy information is material if, when considered together with other information included in an

entity’s financial statements, it can reasonably be expected to influence decisions that the primary users of general purpose financial

statements make on the basis of those financial statements.

Definition of an Accounting Estimate (Amendments to IAS 8)

Under the new definition, accounting estimates are clarified as monetary amounts in financial statements that are subject to

measurement uncertainty. Where an entity's accounting policy requires an item to be measured at monetary amounts that cannot be

observed directly, it should develop an accounting estimate to achieve this objective.  The amendments are effective 1 January 2023

and were  adopted on this date.

IFRS 17 – Insurance contracts

In May 2017, the IASB issued IFRS 17 Insurance Contracts, a comprehensive new accounting standard for insurance contracts covering

recognition and measurement, presentation and disclosure. IFRS 17 has replaced IFRS 4 Insurance Contracts that was issued in 2005.

In June 2020, the IASB published amendments to IFRS 17, to include scope exclusion for certain credit card contracts and similar

contracts that provide insurance coverage, the optional scope exclusion for loan contracts that transfer significant insurance risk, and

the clarification that only financial guarantees issued are in scope of IFRS 9.

IFRS 17 applies to all types of insurance contracts (i.e. life, non-life, direct insurance and reinsurance), regardless of the type of entities

that issue them, as well as to certain guarantees and financial instruments with discretionary participation features. A few scope

exceptions apply.

IFRS 17 was effective for accounting periods beginning on or after 1 January 2023 but the impact to the Group is not material.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

Future accounting developments

The following accounting standards have been issued by the IASB but are not yet effective:

Classification of Liabilities as Current or Non-current (Amendments to IAS 1)

In January 2020 the IASB issued amendments to IAS 1 to clarify the presentation of liabilities in the balance sheet, with an effective date

of 1 January 2024.

The amendments clarify that a liability should be classified as non-current only if the entity has the right to defer settlement of the

liability for at least 12 months after the reporting period, and that (i) the right to defer settlement must exist at the end of the reporting

period and (ii) management’s intentions or expectations about whether it will exercise its right to defer settlement does not affect the

classification. Further clarifications include how lending conditions affect classification and classification of liabilities the entity will or

may settle by issuing its own equity instruments.

In October 2022, the IASB also issued further amendments to IAS 1 to improve the information an entity provides when its right to

defer settlement of a liability for at least 12 months is subject to compliance with covenants, and to respond to stakeholders’ concerns

about the classification of such a liability as current or non-current.

6. Critical accounting estimates and judgements

The preparation of financial statements in accordance with IFRS requires the use of estimates. It also requires management to exercise

judgement in applying the accounting policies. The key areas involving a higher degree of judgement or complexity or areas where

assumptions are significant to the consolidated and individual financial statements are highlighted under the relevant note. Critical

accounting estimates and judgements are disclosed in:

▪ Credit impairment charges on page [431](#i4be61753b7f243b19551b0bfbf3a2a0d_934)

▪ Tax on page [435](#iaab1691f9d60455e9700b770b1b21891_14204)

▪ Fair value of financial instruments on page [449](#i4be61753b7f243b19551b0bfbf3a2a0d_961)

▪ Goodwill and intangible assets on page [466](#ia60a77b41ddf4fc59ba5f7a123af54e8_11741)

▪ Pensions and post-retirement benefit obligations on page [485](#ibce79c8b8d9f4909a95730f3ad61231e_19634)

▪ Provisions including conduct and legal, competition and regulatory matters on page [468](#i4be61753b7f243b19551b0bfbf3a2a0d_982).

7. Other disclosures

To improve transparency and ease of reference, by concentrating related information in one place, certain disclosures required under

IFRS have been included within the Risk review section as follows:

▪ Credit risk on pages [276](#i4be61753b7f243b19551b0bfbf3a2a0d_664)  to [277](#i6fd9b389898b457787d92863d57de9e0_10317) and [291](#i4be61753b7f243b19551b0bfbf3a2a0d_706) to [335](#i992e306d544846d5aa816c5b00936055_3791)

▪ Market risk on page [278](#i4be61753b7f243b19551b0bfbf3a2a0d_667) and [336](#i4be61753b7f243b19551b0bfbf3a2a0d_739) to [337](#i491f97d3f7594970acfc61e493168493_730)

▪ Treasury and Capital risk – liquidity on page [278](#if0debf7102304647bf511aa46ec03f0c_8918) to 279 and [339](#i65b1649a343d4e6981be1817c21942f9_15977) to [349](#id04ff4fec49245f19a256cbb2b0985f8_2872)

▪ Treasury and Capital risk – capital on page [279](#if0debf7102304647bf511aa46ec03f0c_8913) and [350](#i4be61753b7f243b19551b0bfbf3a2a0d_769) to [356](#i99f6f378f60b465b85040e3a7cd2960b_11748).

These disclosures are covered by the Audit opinion (included on pages [396](#i4be61753b7f243b19551b0bfbf3a2a0d_871) to [412](#i2721d0ea60414affb9c1022cd6bf5906_55816)) where referenced as audited.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

#### Financial performance and returns

The notes included in this section focus on the results and performance of the Group. Information on the income generated,

expenditure incurred, segmental performance, tax, earnings per share and dividends are included here.  For further detail on

performance, see income statement commentary within Financial Review (unaudited).

2  Segmental reporting

Presentation of segmental reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the Executive Committee, which is

responsible for allocating resources and assessing performance of the operating segments, and has been identified as the chief

operating decision maker. All transactions between business segments are conducted on an arm’s-length basis, with intra-segment

revenue and costs being eliminated in Head Office. Income and expenses directly associated with each segment are included in

determining business segment performance.

The Group is a British universal bank diversified by business, geography and income type, serving consumer and wholesale customers

and clients globally and for segmental reporting purposes it defines its two operating divisions as Barclays UK and Barclays International.

▪ Barclays UK consists of our UK Personal Banking, UK Business Banking and Barclaycard Consumer UK businesses. These businesses

are carried on by our UK ring-fenced bank (Barclays Bank UK PLC) and certain other entities within the Group.

▪ Barclays International consists of our Corporate and Investment Bank and Consumer, Cards and Payments businesses. These

businesses are carried on by our non ring-fenced bank (Barclays Bank PLC) and its subsidiaries, and certain other entities within the

Group.

The below table also includes Head Office which comprises head office and legacy businesses, as well as the FTEs employed by Barclays

Execution Services.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Analysis of results by business | | | | |  |
|  | Barclays UK | Barclays  International | Head Office | Group results |  |
|  | £m | £m | £m | £m |  |
| For the year ended 31 December 2023 |  |  |  |  |  |
| Total income | 7,587 | 17,918 | (127) | 25,378 |  |
| Operating costs | (4,393) | (11,578) | (743) | (16,714) |  |
| UK bank levy | (30) | (136) | (14) | (180) |  |
| Litigation and conduct | 8 | (47) | 2 | (37) |  |
| Total operating expenses | (4,415) | (11,761) | (755) | (16,931) |  |
| Other net income/(expenses)1 | — | (2) | (7) | (9) |  |
| Profit/(loss) before impairment | 3,172 | 6,155 | (889) | 8,438 |  |
| Credit impairment charges | (304) | (1,548) | (29) | (1,881) |  |
| Profit/(loss) before tax | 2,868 | 4,607 | (918) | 6,557 |  |
| Total assets (£bn) | 293.1 | 1,166.1 | 18.3 | 1,477.5 |  |
| Total liabilities (£bn) | 264.2 | 1,077.9 | 63.5 | 1,405.6 |  |
| Number of employees (full time equivalent) | 6,800 | 12,400 | 73,200 | 92,400 |  |
| Average number of employees (full time equivalent) |  |  |  | 92,900 |  |
| Average number of employees (headcount) |  |  |  | 94,800 |  |

Note

1 Other net income/(expenses) represents the share of post-tax results of associates and joint ventures, profit on disposal of subsidiaries, associates and joint ventures, and gains on

acquisitions.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

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| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | Barclays UK | Barclays  International | Head Office | Group results |
|  | £m | £m | £m | £m |
| For the year ended 31 December 2022 |  |  |  |  |
| Total income | 7,259 | 17,867 | (170) | 24,956 |
| Operating costs | (4,260) | (10,361) | (336) | (14,957) |
| UK bank levy | (26) | (133) | (17) | (176) |
| Litigation and conduct | (41) | (1,503) | (53) | (1,597) |
| Total operating expenses | (4,327) | (11,997) | (406) | (16,730) |
| Other net income/(expenses)1 | — | 28 | (22) | 6 |
| Profit/(loss) before impairment | 2,932 | 5,898 | (598) | 8,232 |
| Credit impairment charges | (286) | (933) | (1) | (1,220) |
| Profit/(loss) before tax | 2,646 | 4,965 | (599) | 7,012 |
| Total assets (£bn) | 313.2 | 1,181.3 | 19.2 | 1,513.7 |
| Total liabilities (£bn) | 287.3 | 1,093.9 | 63.2 | 1,444.4 |
| Number of employees (full time equivalent) | 6,200 | 10,900 | 70,300 | 87,400 |
| Average number of employees (full time equivalent) |  |  |  | 83,900 |
| Average number of employees (headcount) |  |  |  | 86,200 |

Note

1 Other net income  represents the share of post-tax results of associates and joint ventures, profit on disposal of subsidiaries, associates and joint ventures, and gains on acquisitions.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | Barclays UK | Barclays  International | Head  Office | Group results |
|  | £m | £m | £m | £m |
| For the year ended 31 December 2021 |  |  |  |  |
| Total income | 6,536 | 15,665 | (261) | 21,940 |
| Operating costs | (4,357) | (9,076) | (659) | (14,092) |
| UK bank levy | (36) | (134) | — | (170) |
| Litigation and conduct | (37) | (345) | (15) | (397) |
| Total operating expenses | (4,430) | (9,555) | (674) | (14,659) |
| Other net income1 | — | 40 | 220 | 260 |
| Profit/(loss) before impairment | 2,106 | 6,150 | (715) | 7,541 |
| Credit impairment releases | 365 | 288 | — | 653 |
| Profit/(loss) before tax | 2,471 | 6,438 | (715) | 8,194 |
| Total assets (£bn) | 321.2 | 1,044.1 | 19.0 | 1,384.3 |
| Total liabilities (£bn) | 291.8 | 965.4 | 57.0 | 1,314.2 |
| Number of employees (full time equivalent)2 | 7,100 | 10,400 | 64,100 | 81,600 |
| Average number of employees (full time equivalent) |  |  |  | 82,900 |
| Average number of employees (headcount) |  |  |  | 85,600 |

Notes

1 Other net income/(expenses) represents the share of post-tax results of associates and joint ventures, profit (or loss) on disposal of subsidiaries, associates and joint ventures, and

gains on acquisitions.

2 Barclays Execution Services Employees are reported within the Head Office Segment. Barclays UK transformed its business in 2021 and consolidated all Customer Care employees,

who directly serve customers, into Barclays Execution Services to improve customer service and experience. Costs are recharged, while FTEs are reported within Head Office, as at 31

December 2021 10,700 FTEs were impacted by the move from Barclays UK to Head Office.

Barclays PLC has changed the way that its businesses are being managed and will publish comparative financial information reflecting

these changes to its segmental reporting which are effective from January 2024.

From Q124, the Group will present its financial disclosures through the following new segments:

• Barclays UK

• Barclays UK Corporate Bank

• Barclays Private Bank and Wealth Management

• Barclays Investment Bank

• Barclays US Consumer Bank

The previously reported Head office will additionally include the held for sale German consumer finance business and the merchant

acquiring component on the Payments business both previously reported within Barclays International as part of CC&P.

Considering the revised segmentation in January 2024, our assessment has not led to any further financial impacts. These changes do

not affect legal entities nor do they impact the Group’s previously reported consolidated financials. A copy of the resegmentation

document is available at home.barclays/investor-relations/reports-and-events/financial-results/

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Income by geographic region1 | | | |
|  | 2023 | 2022 | 2021 |
| For the year ended 31 December | £m | £m | £m |
| United Kingdom | 13,295 | 14,908 | 11,256 |
| Europe | 2,517 | 2,321 | 2,372 |
| Americas | 8,109 | 6,353 | 7,199 |
| Africa and Middle East | 87 | 63 | 45 |
| Asia | 1,370 | 1,311 | 1,068 |
| Total | 25,378 | 24,956 | 21,940 |
| . |  |  |  |
| Income from individual countries which represent more than 5% of total income1 | | | |
|  | 2023 | 2022 | 2021 |
| For the year ended 31 December | £m | £m | £m |
| United Kingdom | 13,295 | 14,908 | 11,256 |
| United States | 7,911 | 6,176 | 7,048 |

Note

1 The geographical analysis is based on the location of the office where the transactions are recorded .

3 Net interest income

Accounting for interest income and expenses

Interest income on loans and advances at amortised cost and financial assets at fair value through other comprehensive income, and

interest expense on financial liabilities held at amortised cost, are calculated using the effective interest method which allocates

interest, and direct and incremental fees and costs, over the expected lives of the assets and liabilities.

The effective interest method requires the Group to estimate future cash flows, in some cases based on its experience of customers’

behaviour, considering all contractual terms of the financial instrument, as well as the expected lives of the assets and liabilities.

The Group incurs certain costs to originate credit card balances with the most significant being co-brand partner fees. To the extent

these costs are attributed to customers that continuously carry an outstanding balance (revolvers) and incremental to the origination

of credit card balances, they are capitalised and subsequently included within the calculation of the effective interest rate. They are

amortised to interest income over the period of expected repayment of the originated balance. Costs attributed to customers that

settle their outstanding balances each period (transactors) are deferred on the balance sheet as a cost of obtaining a contract and

amortised to fee and commission expense over the life of the customer relationship (refer to Note 4). There are no other individual

estimates involved in the calculation of effective interest rates that are material to the results or financial position.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Cash and balances at central banks | 10,262 | 2,916 | 184 |
| Debt securities at amortised cost | 2,337 | 1,251 | 177 |
| Loans and advances at amortised cost | 14,742 | 12,125 | 9,363 |
| Fair value through other comprehensive income | 4,907 | 1,963 | 550 |
| Negative interest on liabilities | 46 | 208 | 248 |
| Other1 | 2,781 | 633 | 718 |
| Interest and similar income | 35,075 | 19,096 | 11,240 |
| Deposits at amortised cost | (11,252) | (3,573) | (561) |
| Debt securities in issue | (6,344) | (3,240) | (1,340) |
| Subordinated liabilities | (866) | (530) | (507) |
| Negative interest on assets | (7) | (208) | (374) |
| Other2 | (3,897) | (973) | (385) |
| Interest and similar expense | (22,366) | (8,524) | (3,167) |
| Net interest income | 12,709 | 10,572 | 8,073 |

Notes

1 Other interest and similar income includes interest income from cash collaterals and reverse repurchase agreements and other similar secured lending at amortised cost.

2 Other interest and similar expense includes interest expense from cash collaterals and repurchase agreements and other similar secured borrowing at amortised cost.

Interest and similar income presented above represents interest revenue calculated using the effective interest method. Costs to

originate credit card balances of £935m (2022: £786m; 2021 : £652m) have been amortised to interest and similar income during the

year.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

4 Net fee and commission income

Accounting for net fee and commission income

The Group recognises fee and commission income charged for services provided by the Group as and when performance obligations

are satisfied, for example, on completion of the underlying transaction. Incremental costs are reported within fee and commission

expense if they are directly attributable to generating identifiable fee and commission income. Where the contractual arrangements

also result in the Group recognising financial instruments in scope of IFRS  9, such financial instruments are initially recognised at fair

value in accordance with IFRS 9 before applying the provisions of IFRS 15.

Fee and commission income is disaggregated below by fee types that reflect the nature of the services offered across the Group and

operating segments, in accordance with IFRS 15. The below table includes a total for fees in scope of IFRS  15. Refer to Note 2 for more

detailed information about operating segments.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | 2023 | | | |
|  | Barclays UK | Barclays  International | Head Office | Total |
|  | £m | £m | £m | £m |
| Fee type |  |  |  |  |
| Transactional | 1,124 | 3,692 | — | 4,816 |
| Advisory | 52 | 903 | — | 955 |
| Brokerage and execution | 234 | 1,763 | — | 1,997 |
| Underwriting and syndication | 33 | 2,080 | — | 2,113 |
| Other | 36 | 62 | 3 | 101 |
| Total revenue from contracts with customers | 1,479 | 8,500 | 3 | 9,982 |
| Other non-contract fee income | — | 139 | — | 139 |
| Fee and commission income | 1,479 | 8,639 | 3 | 10,121 |
| Fee and commission expense | (368) | (3,217) | (7) | (3,592) |
| Net fee and commission income | 1,111 | 5,422 | (4) | 6,529 |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | 2022 | | | |
|  | Barclays UK | Barclays  International | Head Office | Total |
|  | £m | £m | £m | £m |
| Fee type |  |  |  |  |
| Transactional | 1,084 | 3,256 | — | 4,340 |
| Advisory | 161 | 964 | — | 1,125 |
| Brokerage and execution | 256 | 1,521 | — | 1,777 |
| Underwriting and syndication | — | 2,037 | — | 2,037 |
| Other | 59 | 153 | 3 | 215 |
| Total revenue from contracts with customers | 1,560 | 7,931 | 3 | 9,494 |
| Other non-contract fee income | — | 143 | — | 143 |
| Fee and commission income | 1,560 | 8,074 | 3 | 9,637 |
| Fee and commission expense | (319) | (2,713) | (6) | (3,038) |
| Net fee and commission income | 1,241 | 5,361 | (3) | 6,599 |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | 2021 | | | |
|  | Barclays UK | Barclays  International | Head Office | Total |
|  | £m | £m | £m | £m |
| Fee type |  |  |  |  |
| Transactional | 871 | 2,572 | — | 3,443 |
| Advisory | 172 | 1,096 | 1 | 1,269 |
| Brokerage and execution | 228 | 1,135 | — | 1,363 |
| Underwriting and syndication | — | 3,425 | — | 3,425 |
| Other | 74 | 182 | 3 | 259 |
| Total revenue from contracts with customers | 1,345 | 8,410 | 4 | 9,759 |
| Other non-contract fee income | — | 121 | — | 121 |
| Fee and commission income | 1,345 | 8,531 | 4 | 9,880 |
| Fee and commission expense | (218) | (1,983) | (5) | (2,206) |
| Net fee and commission income | 1,127 | 6,548 | (1) | 7,674 |

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

Fee types

Transactional

Transactional fees are service charges on deposit accounts, cash management services fees and transactional processing fees. These

include interchange and merchant fee income generated from credit and bank card usage. Transaction and processing fees are

recognised at the point in time the transaction occurs or service is performed. Interchange and merchant fees are recognised upon

settlement of the card transaction payment.

The Group incurs certain card-related costs including those related to cardholder reward programmes and payments to co-brand

partners. Cardholder reward programme costs related to customers that settle their outstanding balance each period (transactors) are

expensed when incurred and presented in fee and commission expense, while costs related to customers that continuously carry an

outstanding balance (revolvers) are included in the effective interest rate of the receivable (refer to Note 3). Payments to partners for

new cardholder account originations related to transactor accounts are deferred as costs to obtain a contract under IFRS 15, while

costs related to revolver accounts are included in the effective interest rate of the receivable (refer to Note 3). Those costs deferred

under IFRS 15 are capitalised and amortised over the estimated life of the customer relationship. Payments to co-brand partners based

on revenue sharing to the extent the revenue share relates to "revolvers" are included in the effective interest rate of the receivable and

to the extent  revenue share relates  to “transactors”  it must be presented in fee and commission expense. Payments based on

profitability are presented in fee and commission expense.

Advisory

Advisory fees are generated from wealth management services and investment banking advisory services related to mergers,

acquisitions and financial restructurings. Wealth management advisory fees are earned over the period the services are provided and

are generally recognised quarterly when the market value of client assets is determined. Investment banking advisory fees are

recognised at the point in time when the services related to the transaction have been completed under the terms of the engagement.

Investment banking advisory costs are recognised as incurred in fee and commission expense if direct and incremental to the advisory

services or are otherwise recognised in operating expenses.

Brokerage and execution

Brokerage and execution fees are earned for executing client transactions with various exchanges and over-the-counter markets and

assisting clients in clearing transactions and facilitating foreign exchange transactions for spot/forward contracts. Brokerage and

execution fees are recognised at the point in time the associated service has been completed which is generally the trade date of the

transaction.

Underwriting and syndication

Underwriting and syndication fees are earned for the distribution of client equity or debt securities and the arrangement and

administration of a loan syndication. This includes commitment fees to provide loan financing. Underwriting fees are generally

recognised on trade date if there is no remaining contingency, such as the transaction being conditional on the closing of an acquisition

or another transaction. Underwriting costs are deferred and recognised in fee and commission expense when the associated

underwriting fees are recorded. Syndication fees are earned for arranging and administering a loan syndication; however, the associated

fee may be subject to variability until the loan has been syndicated to other syndicate members or until other contingencies have been

resolved and therefore the fee revenue is deferred until the uncertainty is resolved.

Included in the underwriting and syndication fees are loan commitment fees, when the drawdown is not probable. Such commitment

fees are recognised over time through to the contractual maturity of the commitment.

Contract assets and contract liabilities

The Group had no material contract assets or contract liabilities as at 31 December 2023 (2022: £nil; 2021: £nil).

Impairment of fee receivables and contract assets

During 2023, there have been  no material impairments recognised in relation to fees receivable and contract assets (2022: £nil; 2021:

£nil). Fees in relation to transactional business can be added to outstanding customer balances. These amounts may be subsequently

impaired as part of the overall loans and advances balance.

Remaining performance obligations

The Group applies the practical expedient of IFRS 15 and does not disclose information about remaining performance obligations that

have original expected durations of one year or less or because the Group has a right to consideration that corresponds directly with

the value of the service provided to the client or customer.

Costs incurred in obtaining or fulfilling a contract

The Group expects that incremental costs of obtaining a contract such as success fee and commission fees paid are recoverable and

therefore capitalise such  contract  costs.  Capitalised contract costs net of amortisation as at 31 December 2023 are £217m (2022:

£198m; 2021: £154m).

Capitalised contract costs are amortised over the customer relationship period depending on the transfer of services to which the

asset pertains. In 2023, the amount of amortisation was £55m (2022: £47m; 2021: £36m) and there was no impairment loss recognised

in connection with the capitalised contract costs (2022: £nil; 2021: £nil).

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

5 Net trading income

Accounting for net trading income

Trading positions are held at fair value, and the resulting gains and losses are included in  net trading income, together with interest and

dividends arising from long and short positions and funding costs relating to trading activities. Incremental costs are reported within net

trading income if they are directly attributable to generating identifiable trading income.

Income arises from both the sale and purchase of trading positions, margins which are achieved through market-making and customer

business and from changes in fair value caused by movements in interest and exchange rates, equity prices and other market variables.

Gains or losses on non-trading financial instruments designated or mandatorily at fair value with changes in fair value recognised in the

income statement are included in net trading income.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Net gains on financial instruments held for trading | 4,257 | 6,021 | 3,992 |
| Net gains on financial instruments designated at fair value | 380 | 508 | 692 |
| Net gains on financial instruments mandatorily at fair value | 1,308 | 1,520 | 1,110 |
| Net trading income | 5,945 | 8,049 | 5,794 |

6 Net investment income/(expense)

Accounting for net investment income/(expense)

Dividends are recognised when the right to receive the dividend has been established. Incremental costs are reported within net

investment income if they are directly attributable to generating identifiable investment income. Other accounting policies relating to

net investment income are set out in Note 13 and Note 15.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Net gains/(losses) from financial instruments mandatorily at fair value | 171 | (51) | 73 |
| Net gains/(losses) from disposal of debt instruments at fair value through other comprehensive  income | 26 | (111) | 305 |
| Net (losses)/gains from disposal of financial assets and liabilities measured at amortised cost | (17) | (18) | 114 |
| Dividend income | — | 31 | 20 |
| Net losses on other investments1 | (119) | (285) | (201) |
| Net investment income/(expense) | 61 | (434) | 311 |

Note

1 Included within the 2022 balance are losses of £74m on sale arising from disposal of Barclays’ equity stake in Absa Group Limited (Absa) in April 2022 and September 2022.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

7 Operating expenses

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Infrastructure costs |  |  |  |
| Property and equipment1 | 1,948 | 1,649 | 1,538 |
| Depreciation and amortisation | 1,784 | 1,723 | 1,673 |
| Impairment of property, equipment and intangible assets1 | 363 | 63 | 403 |
| Total infrastructure costs | 4,095 | 3,435 | 3,614 |
| Administration and general expenses |  |  |  |
| Consultancy, legal and professional fees | 782 | 669 | 610 |
| Marketing and advertising | 585 | 500 | 399 |
| UK bank levy | 180 | 176 | 170 |
| Other administration and general expenses | 1,235 | 1,101 | 958 |
| Total administration and general expenses | 2,782 | 2,446 | 2,137 |
| Staff costs1 | 10,017 | 9,252 | 8,511 |
| Litigation and conduct2 | 37 | 1,597 | 397 |
| Operating expenses | 16,931 | 16,730 | 14,659 |

Notes

1 Infrastructure costs & Staff costs included £927m relating to structural cost actions taken in Q4 2023 and £266m taken as a part of real estate review in 2021.

2 Includes costs related to the Over-issuance of securities (2022: £966m, 2021: £220m).

For further details on staff costs including accounting policies, refer to Note 30 .

8  Credit impairment charges/(releases)

Accounting for the impairment of financial assets

Impairment

The Group is required to recognise expected credit losses (ECLs) based on unbiased forward-looking information for all financial assets

at amortised cost, lease receivables, debt financial assets at fair value through other comprehensive income, loan commitments and

financial guarantee contracts.

At the reporting date, an allowance (or provision for loan commitments and financial guarantees) is required for the 12 month (Stage 1)

ECLs. If the credit risk has significantly increased since initial recognition (Stage 2), or if the financial instrument is credit impaired (Stage

3), an allowance (or provision) should be recognised for the lifetime ECLs.

The measurement of ECL is calculated using three main components: (i) probability of default (PD) (ii) loss given default (LGD) and (iii)

the exposure at default (EAD).

The 12 month and lifetime ECLs are calculated by multiplying the respective PD, LGD and the EAD. The  12 month and lifetime PDs

represent the PD occurring over the next 12 months and the remaining maturity of the instrument respectively. The EAD represents

the expected balance at default, taking into account the repayment of principal and interest from the balance sheet date to the default

event together with any expected drawdowns of committed facilities. The LGD represents expected losses on the EAD given the event

of default, taking into account, among other attributes, the mitigating effect of collateral value at the time it is expected to be realised

and the time value of money.

Expected credit loss measurement is based on the ability of borrowers to make payments as they fall due. The Group also considers

sector-specific risks and whether additional adjustments are required in the measurement of ECL. Credit risk may be impacted by

climate considerations for certain sectors, such as oil and gas.

Determining a significant increase in credit risk since initial recognition:

The Group assesses when a significant increase in credit risk has occurred based on quantitative and qualitative assessments. The

credit risk of an exposure is considered to have significantly increased when:

i) Quantitative test

The annualised lifetime PD has increased by more than an agreed threshold relative to the equivalent at origination.

PD deterioration thresholds are defined as percentage increases, and are set at an origination score band and segment level to ensure

the test appropriately captures significant increases in credit risk at all risk levels. Generally, thresholds are inversely correlated to the

origination PD, i.e. as the origination PD increases, the threshold value reduces.

The assessment of the point at which a PD increase is deemed ‘significant’, is based upon analysis of the portfolio’s risk profile against a

common set of principles and performance metrics (consistent across both retail and wholesale businesses), incorporating expert

credit judgement where appropriate. Application of quantitative PD floors does not represent the use of the low credit risk exemption

as exposures can separately move into Stage 2 via the qualitative route described below.

Wholesale assets apply a 100% increase in PD and 0.2% PD floor to determine a significant increase in credit risk.

Retail assets apply bespoke relative increase and absolute PD thresholds based on product type and origination PD. Thresholds are

subject to maximums defined by Group policy and typically apply minimum relative thresholds of 50-100%  and a maximum relative

threshold of 400%.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

For existing/historical exposures where origination point scores or data are no longer available or do not represent a comparable

estimate of lifetime PD, a proxy origination score is defined, based upon:

• back-population of the approved lifetime PD score either to origination date or, where this is not feasible, as far back as possible

(subject to a data start point no later than 1 January 2015); or

• use of available historical account performance data and other customer information, to derive a comparable ‘proxy’ estimation of

origination PD.

ii) Qualitative test

This is relevant for accounts that meet the portfolio’s ‘high risk’ criteria and are subject to closer credit monitoring.

High risk customers may not be in arrears but either through an event or an observed behaviour exhibit credit distress. The definition

and assessment of high risk includes as wide a range of information as reasonably available, such as industry and Group-wide customer

level data, including but not limited to bureau scores and high consumer indebtedness index, wherever possible or relevant.

Whilst the high risk populations applied for IFRS 9 impairment purposes are aligned with risk management processes, they are also

regularly reviewed and validated to ensure that they capture any incremental segments where there is evidence of credit deterioration.

iii) Backstop criteria

This is relevant for accounts that are more than 30 calendar days past due. The 30  days past due criteria is a backstop rather than a

primary driver of moving exposures into Stage 2.

The criteria for determining a significant increase in credit risk for assets with bullet repayments follows the same principle as all other

assets, i.e. quantitative, qualitative and backstop tests are all applied.

Exposures will move back to Stage 1 once they no longer meet the criteria for a significant increase in credit risk. This means that, at a

minimum all payments must be up-to-date, the PD deterioration test is no longer met, the account is no longer classified as high risk,

and the customer has evidenced an ability to maintain future payments.

Exposures are only removed from Stage 3 and reassigned to Stage 2 once the original default trigger event no longer applies.

Exposures being removed from Stage 3 must no longer qualify as credit impaired, and:

a) the obligor will also have demonstrated consistently good payment behaviour over a 12-month period, by making all consecutive

contractual payments due and, for forborne exposures, the relevant EBA defined probationary period has also been successfully

completed or;

b) (for non-forborne exposures) the performance conditions are defined and approved within an appropriately sanctioned restructure

plan, including 12 months’ payment history have been met.

Management overlays and other exceptions to model outputs are applied only if consistent with the objective of identifying significant

increases in credit risk.

Forward-looking information

The measurement of ECL involves complexity and judgement, including estimation of PD, LGD, a range of unbiased future economic

scenarios, estimation of expected lives (where contractual life is not appropriate), and estimation of EAD and assessing significant

increases in credit risk.

Credit losses are the expected cash shortfalls from what is contractually due over the expected life of the financial instrument,

discounted at the original effective interest rate (EIR). ECLs are the unbiased probability-weighted credit losses determined by

evaluating a range of possible outcomes and considering future economic conditions.

Refer to the Measurement uncertainty and sensitivity analysis section on page [311](#i4be61753b7f243b19551b0bfbf3a2a0d_721) for further details.

Definition of default, credit impaired assets, write-offs, and interest income recognition

The definition of default for the purpose of determining ECLs, and for internal credit risk management purposes, has been aligned to

the Regulatory Capital CRR Article 178 definition of default, to maintain a consistent approach with IFRS 9 and associated regulatory

guidance. The Regulatory Capital CRR Article 178 definition of default considers indicators that the debtor is unlikely to pay, includes

exposures in forbearance and is no later than when the exposure is more than 90 days past due. When exposures are identified as credit

impaired at the time when they are purchased or originated, interest income is calculated on the carrying value net of the impairment

allowance.

An asset is considered credit impaired when one or more events occur that have a detrimental impact on the estimated future cash

flows of the financial asset. This comprises assets defined as defaulted and other individually assessed exposures where imminent

default or actual loss is identified.

Uncollectable loans are written off against the related allowance for loan impairment on completion of the Group’s internal processes

and when all reasonably expected recoverable amounts have been collected. Subsequent recoveries of amounts previously written off

are credited to the income statement. The timing and extent of write-offs may involve some element of subjective judgement.

Nevertheless, a write-off will often be prompted by a specific event, such as the inception of insolvency proceedings or other formal

recovery action, which makes it possible to establish that some or the entire advance is beyond realistic prospect of recovery.

Accounting for purchased financial guarantee contracts

The Group may enter into a financial guarantee contract which requires the issuer of such contract to reimburse the Group for a loss it

incurs because a specified debtor fails to make payment when due in accordance with the terms of a debt instrument. For these

separate financial guarantee contracts, the Group recognises a reimbursement asset aligned with the recognition of the underlying

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

ECLs, if it is considered virtually certain that a reimbursement would be received if the specified debtor fails to make payment when due

in accordance with the terms of the debt instrument.

Loan modifications and renegotiations that are not credit-impaired

When modification of a loan agreement occurs as a result of commercial restructuring activity rather than due to the credit risk of the

borrower, an assessment must be performed to determine whether the terms of the new agreement are substantially different from

the terms of the existing agreement. This assessment considers both the change in cash flows arising from the modified terms as well

as the change in overall instrument risk profile. In respect of payment holidays granted to borrowers which are not due to forbearance, if

the revised cash flows on a present value basis (based on the original EIR) are not substantially different from the original cash flows, the

loan is not considered to be substantially modified.

Where terms are substantially different, the existing loan will be derecognised and a new loan will be recognised at fair value, with any

difference in valuation recognised immediately within the income statement, subject to observability criteria.

Where terms are not substantially different, the loan carrying value will be adjusted to reflect the present value of modified cash flows

discounted at the original EIR, with any resulting gain or loss recognised immediately within the income statement as a modification gain

or loss.

Expected life

Lifetime ECLs must be measured over the expected life. This is restricted to the maximum contractual life and takes into account

expected prepayment, extension, call and similar options. The exceptions are certain revolving financial instruments, such as credit

cards and bank overdrafts, that include both a drawn and an undrawn component where the entity’s contractual ability to demand

repayment and cancel the undrawn commitment does not limit the entity’s exposure to credit losses to the contractual notice period.

For revolving facilities, expected life is analytically derived to reflect the behavioural life of the asset, i.e. the full period over which the

business expects to be exposed to credit risk. Behavioural life is typically based upon historical analysis of the average time to default,

closure or withdrawal of facility. Where data is insufficient or analysis inconclusive, an additional ‘maturity factor’ may be incorporated to

reflect the full estimated life of the exposures, based upon experienced judgement and/or peer analysis. Potential future modifications

of contracts are not taken into account when determining the expected life or EAD until they occur.

Discounting

ECLs are discounted at the EIR at initial recognition or an approximation thereof and consistent with income recognition. For loan

commitments the EIR is the rate that is expected to apply when the loan is drawn down and a financial asset is recognised. Issued

financial guarantee contracts are discounted at the risk free rate. Lease receivables are discounted at the rate implicit in the lease. For

variable/floating rate financial assets, the spot rate at the reporting date is used and projections of changes in the variable rate over the

expected life are not made to estimate future interest cash flows or for discounting.

Modelling techniques

Currently, Internal Ratings- Based models are leveraged to calculate the point-in-time PD and LGD, which serve as key inputs to the

IFRS 9 models. Thereafter, these inputs are extrapolated by the IFRS 9 models to create macroeconomic sensitive forecast of PDs,

LGDs and in turn ECL.

Forbearance

A financial asset is subject to forbearance when it is modified due to the credit distress of the borrower. A modification made to the

terms of an asset due to forbearance will typically be assessed as a non-substantial modification that does not result in derecognition of

the original loan, except in circumstances where debt is exchanged for equity.

Both performing and non-performing forbearance assets are classified as Stage 3 except where it is established that the concession

granted has not resulted in diminished financial obligation and that no other regulatory definition of default criteria have been triggered,

in which case the asset is classified as Stage 2. The minimum probationary period for non-performing forbearance is 12 months and for

performing forbearance, 24 months. Hence, a minimum of 36 months is required for non-performing forbearance to move out of a

forborne state.

No financial instrument in forbearance can transfer back to Stage 1 until all of the Stage 2 thresholds are no longer met and can only

move out of Stage 3 when no longer credit impaired.

Critical accounting estimates and judgements

IFRS 9 impairment involves several important areas of judgement, including estimating forward-looking modelled parameters (PD, LGD

and EAD), developing a range of unbiased future economic scenarios, estimating expected lives and assessing significant increases in

credit risk, based on the Group’s experience of managing credit risk. The determination of expected life is most material for Barclays'

credit card portfolios which is obtained via behavioural life analysis to materially capture the risk of these facilities.

Within the retail and small businesses portfolios, which comprise large numbers of small homogenous assets with similar risk characteristics

where credit scoring techniques are generally used, the impairment allowance is calculated using forward-looking modelled parameters which

are typically run at account level. There are many models in use, each tailored to a product, line of business or customer category. Judgement

and knowledge is needed in selecting the statistical methods to use when the models are developed or revised. Management adjustments to

impairment models, which contain an element of subjectivity, are applied in order to factor in certain conditions or changes in policy that are not

fully incorporated into the impairment models, or to reflect additional facts and circumstances at the period end. Management adjustments are

reviewed and incorporated into future model development where appropriate.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

For individually significant assets in Stage 3, impairment allowances are calculated on an individual basis and all relevant considerations that have

a bearing on the expected future cash flows across a range of economic scenarios are taken into account. These considerations can be

particularly subjective and can include the business prospects for the customer, the realisable value of collateral, the Group’s position relative to

other claimants, the reliability of customer information and the likely cost and duration of the work-out process. The level of the impairment

allowance is the difference between the value of the discounted expected future cash flows (discounted at the loan’s original effective interest

rate), and its carrying amount. Furthermore, judgements change with time as new  information becomes available or as work-out strategies

evolve, resulting in frequent revisions to the impairment allowance as individual decisions are taken. Changes in these estimates would result in a

change in the allowances and have a direct impact on the impairment charge.

Further information on impairment allowances, impairment charges, management adjustments to models for impairment, measurement

uncertainty, sensitivity analysis and related credit information is set out within the Credit risk performance section.

Temporary adjustments to calculated IFRS9 impairment allowances may be applied in limited circumstances to account for situations where

known or expected risk factors or information have not been considered in the ECL assessment or modelling process. For further information

please see page [307](#i4be61753b7f243b19551b0bfbf3a2a0d_718) in the Credit risk performance section.

Information about the potential impact of the physical and transition risks of climate change on borrowers is considered, taking into account

reasonable and supportable information to make accounting judgements and estimates. Climate change is inherently of a long-term nature,

with significant levels of uncertainty, and consequently requires judgement in determining the possible impact in the next financial year, if any.

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
|  | 2023 | | | 2022 | | | 2021 | | |
|  | Impairment  charges /  (releases) | Recoveries and  reimbursements1 | Total2 | Impairment  charges /  (releases) | Recoveries and  reimbursements 1 | Total | Impairment  charges /  (releases) | Recoveries and  reimbursements 1 | Total |
|  | £m | £m | £m | £m | £m | £m | £m | £m | £m |
| Loans and advances at amortised cost3 | 2,017 | (73) | 1,944 | 1,428 | (263) | 1,165 | (361) | 240 | (121) |
| Off-balance sheet loan  commitments and financial  guarantee contracts | (61) | — | (61) | 18 | — | 18 | (514) | — | (514) |
| Total | 1,956 | (73) | 1,883 | 1,446 | (263) | 1,183 | (875) | 240 | (635) |
| Cash collateral and settlement balances | 4 | — | 4 | 28 | — | 28 | (4) | — | (4) |
| Financial instruments at fair value  through other comprehensive income | (1) | — | (1) | 9 |  | 9 | (8) | — | (8) |
| Other financial asset measured at cost | (5) | — | (5) | — | — | — | (6) | — | (6) |
| Credit impairment charges /(releases) | 1,954 | (73) | 1,881 | 1,483 | (263) | 1,220 | (893) | 240 | (653) |

Notes

1 Recoveries and reimbursements includes £29m (2022: £199m, 2021: £(306)m) for reimbursements expected to be received under the arrangement where Group has entered into

financial guarantee contracts which provide credit protection over certain assets with third parties and cash recoveries of previously written off amounts of £44m (2022: £64m, 2021:

£66m).

2 Includes net impairment charges of £19m relating to the German consumer finance portfolio classified as assets held for sale during the year.

3 Includes Debt securities at amortised cost.

Write-offs that can be subjected to enforcement activity

The contractual amount outstanding on financial assets that were written off during the year and that can still be subjected to

enforcement activity is £597m (2022: £949m). This is lower than the write-offs presented in the movement in gross exposures and

impairment allowance table due to assets sold during the year post write-offs and post write-off recoveries.

Modification of financial assets

Financial assets of £2,690m (2022: £2,412m, 2021: £3,446m), with a loss allowance measured at an amount equal to lifetime ECL, were

subject to non-substantial modification during the year, with a resulting loss of £4m (2022: £4m, 2021: £11m). The gross carrying

amount of financial assets subject to non-substantial modification for which the loss allowance has changed to a 12 month ECL during

the year amounts to £149m (2022: £1,077m, 2021: £419m).

9 Tax

Accounting for income taxes

The Group applies IAS 12 Income Taxes  in accounting for taxes on income. Income tax payable on taxable profits (current tax) is

recognised as an expense in the periods in which the profits arise. Withholding taxes are also treated as income taxes. Income tax

recoverable on tax allowable losses is recognised as a current tax asset only to the extent that it is regarded as recoverable by offsetting

against taxable profits arising in the current or prior periods. Current tax is measured using tax rates and tax laws that have been

enacted or substantively enacted at the balance sheet date.

Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible

temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised. Deferred tax liabilities are

recognised for all taxable temporary differences except for the initial recognition of goodwill. Deferred tax is not recognised where the

temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at

the time of the transaction, affects neither the accounting profit nor taxable profit or loss. Deferred tax is determined using tax rates

and legislation enacted or substantively enacted by the balance sheet date which are expected to apply when the deferred tax asset is

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

realised or the deferred tax liability is settled. Deferred tax assets and liabilities are only offset when there is both a legal right to set-off

and an intention to settle on a net basis.

The Group considers an uncertain tax position to exist when it considers that ultimately, in the future, the amount of profit subject to

tax may be greater than the amount initially reflected in the Group’s tax returns. The Group accounts for provisions in respect of

uncertain tax positions in two different ways.

A current tax provision is recognised when it is considered probable that the outcome of a review by a tax authority of an uncertain tax

position will alter the amount of cash tax due to, or from, a tax authority in the future. From recognition, the current tax provision is then

measured at the amount the Group ultimately expects to pay the tax authority to resolve the position. The accrual of interest and

penalty amounts in respect of uncertain income tax positions is recognised as an expense within profit before tax.

Deferred tax provisions are adjustments made to the carrying value of deferred tax assets in respect of uncertain tax positions. A

deferred tax provision is recognised when it is considered probable that the outcome of a review by a tax authority of an uncertain tax

position will result in a reduction in the carrying value of the deferred tax asset. From recognition of a provision, measurement of the

underlying deferred tax asset is adjusted to take into account the expected impact of resolving the uncertain tax position on the loss or

temporary difference giving rise to the deferred tax asset.

The approach taken to measurement takes account of whether the uncertain tax position is a discrete position that will be reviewed by

the tax authority in isolation from any other position, or one of a number of issues which are expected to be reviewed together

concurrently and resolved simultaneously with a tax authority. The Group’s measurement of provisions is based upon its best estimate

of the additional profit that will become subject to tax. For a discrete position, consideration is given only to the merits of that position.

Where a number of issues are expected to be reviewed and resolved together, the Group will take into account not only the merits of its

position in respect of each particular issue but also the overall level of provision relative to the aggregate of the uncertain tax positions

across all the issues that are expected to be resolved at the same time. In addition, in assessing provision levels, it is assumed that tax

authorities will review uncertain tax positions and that all facts will be fully and transparently disclosed.

Critical accounting estimates and judgements

There are two key areas of judgement that impact the reported tax position. Firstly, the level of provisioning for uncertain tax positions;

and secondly, the recognition and measurement of deferred tax assets.

The Group does not consider there to be a significant risk of a material adjustment to the carrying amount of current and deferred tax

balances, including provisions for uncertain tax positions in the next financial year. The provisions for uncertain tax positions cover a

diverse range of issues and reflect advice from external counsel where relevant. It should be noted that only a proportion of the total

uncertain tax positions will be under audit at any point in time, and could therefore be subject to challenge by a tax authority over the

next year.

Deferred tax assets have been recognised based on business profit forecasts which included consideration for the current view of

climate impacts. Details on the recognition of deferred tax assets are provided in this note.

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| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Current tax charge/(credit) |  |  |  |
| Current year | 1,359 | 1,045 | 1,417 |
| Adjustments in respect of prior years | (181) | (444) | 317 |
|  | 1,178 | 601 | 1,734 |
| Deferred tax (credit)/charge |  |  |  |
| Current year | (95) | 235 | (352) |
| Adjustments in respect of prior years | 151 | 203 | (244) |
|  | 56 | 438 | (596) |
| Tax charge | 1,234 | 1,039 | 1,138 |

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| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

The table below shows the reconciliation between the actual tax charge and the tax charge that would result from applying the standard

UK corporation tax rate to the Group’s profit before tax.

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| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | 2023 | 2023 | 2022 | 2022 | 2021 | 2021 |
|  | £m | % | £m | % | £m | % |
| Profit before tax | 6,557 |  | 7,012 |  | 8,194 |  |
| Tax charge based on the applicable UK corporation tax rate of 23.5%  (2022:  19%; 2021:  19%  ) | 1,541 | 23.5% | 1,332 | 19.0% | 1,557 | 19.0% |
| Impact of profits/losses earned in territories with different statutory rates  to the UK (weighted average tax rate is 23.6% (2022:  21.4%; 2021: 22.4%  )) | 4 | 0.1% | 167 | 2.4% | 277 | 3.4% |
|  |  |  |  |  |  |  |
| Recurring items: |  |  |  |  |  |  |
| Non-creditable taxes including withholding taxes | 130 | 2.0% | 126 | 1.8% | 134 | 1.6% |
| Non-deductible expenses | 65 | 1.0% | 51 | 0.7% | 80 | 1.0% |
| Impact of UK bank levy being non-deductible | 42 | 0.6% | 33 | 0.5% | 32 | 0.4% |
| Banking surcharge1  and other items | 31 | 0.5% | 101 | 1.4% | 83 | 1.0% |
| Impact of Barclays Bank PLC's overseas branches being taxed both locally  and in the UK | 14 | 0.2% | 17 | 0.2% | 25 | 0.3% |
| Tax adjustments in respect of share-based payments | 4 | 0.1% | 13 | 0.2% | (5) | (0.1%) |
| Adjustments in respect of prior years | (30) | (0.5%) | (241) | (3.4%) | 73 | 0.9% |
| Changes in recognition of deferred tax and effect of unrecognised tax  losses | (58) | (0.9%) | (146) | (2.1%) | (140) | (1.7%) |
| Non-taxable gains and income | (65) | (1.0%) | (135) | (1.9%) | (198) | (2.4%) |
| Tax relief on holdings of inflation-linked government bonds | (214) | (3.3%) | (556) | (7.9%) | (169) | (2.1%) |
| Tax relief on payments made under AT1 instruments | (222) | (3.4%) | (172) | (2.4%) | (149) | (1.8%) |
|  |  |  |  |  |  |  |
| Non-recurring items: |  |  |  |  |  |  |
| Remeasurement of UK deferred tax assets due to tax rate changes | — | — | 346 | 4.9% | (462) | (5.6%) |
| Non-deductible provisions for investigations and litigation | — | — | 93 | 1.3% | — | — |
| Non-deductible provisions for UK customer redress | (8) | (0.1%) | 10 | 0.1% | — | — |
| Total tax charge | 1,234 | 18.8% | 1,039 | 14.8% | 1,138 | 13.9% |

Note

1 Banking surcharge includes the impact of the 4.25% UK banking surcharge rate on profits/losses and tax adjustments relating to UK banking entities.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 436 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

Factors influencing the effective tax rate

As a result of the increase in the UK corporation tax rate from 19% to 25% from 1 April 2023, the applicable UK corporation tax rate for

the year ended 31 December 2023 is 23.5%. In addition, the banking surcharge rate reduced from 8% to 3% from 1 April 2023 resulting

in a total tax rate applicable to banks’ UK profits of 27.75% for the year ended 31 December 2023.

The effective tax rate of 18.8% is lower than the applicable UK corporation tax rate of 23.5% primarily due to tax relief on payments

made under AT1 instruments and tax relief on holdings of inflation-linked government bonds. These factors, which have each

decreased the effective tax rate, are partially offset by non-creditable taxes including withholding taxes.

Factors that may influence the effective tax rate in future periods

The Group’s future tax charge will be sensitive to the geographic mix of profits earned, the tax rates in force and changes to the tax

rules in the jurisdictions that the Group operates in.

Tax law is, at times, complex, and it is the role of courts and tribunals to act as the final authority on the correct interpretation of tax law.

In October 2023, a First-tier Tax Tribunal hearing took place between Barclays Bank PLC and HM Revenue & Customs in respect of the

UK corporation tax treatment of an element of the finance costs associated with reserve capital instruments issued as part of the

capital raising announced by Barclays in October 2008, which have since been redeemed. The maximum additional tax liability that could

arise under the dispute is £215m and a provision of £106m is carried in respect of this uncertainty. The judgement is expected to be

received in early 2024.

The OECD and G20 Inclusive Framework on Base Erosion and Profit Shifting announced plans under the Pillar Two Framework to

introduce a global minimum tax rate of 15% and the OECD issued model rules in 2021. Further OECD guidance has been released

during 2022 and 2023 and the UK Government enacted legislation on 11 July 2023 to implement the global minimum tax rules and a UK

domestic minimum tax. The UK’s Pillar Two rules apply for accounting periods beginning on or after 31 December 2023 and will apply in

respect of profits for every jurisdiction where the Group operates.

Additionally, the Group may be subject to Qualifying Domestic Minimum Top-up Taxes (QDMTTs) under the Pillar Two rules

implemented in its operating jurisdictions. The application of QDMTT rules should not affect the overall impact of any additional taxes

resulting from the Pillar Two regime on the Group’s tax charge, as any taxes paid under a local QDMTT would be expected to result in a

reduction in any top-up tax being payable in the UK.

The Group has adopted the International Tax Reform - Pillar Two Model Rules amendments to IAS 12, which were issued on 23 May

2023 and approved by the UK Endorsement Board on 19 July 2023, and has applied the exception set out in paragraph 4A in respect of

recognising and disclosing information about deferred tax assets and liabilities related to Pillar Two income taxes.

The Group has reviewed the published UK legislation alongside the OECD model rules and guidance and has performed an assessment

of the expected impact of the new regime. Additional taxes resulting from the implementation of Pillar Two are expected to arise from 1

January 2024 in respect of a limited number of jurisdictions in which the Group operates, principally in the Isle of Man, Jersey, Guernsey,

and Ireland, by virtue of their low statutory tax rates. However, these additional taxes are not expected to significantly increase the

Group's future tax charge based on an estimated impact of c.£20m per annum, with actual future liabilities being dependent on levels of

profits in particular jurisdictions. The Group will continue to review further guidance due to be released by the OECD and governments

implementing this new tax regime to assess the potential impact.

In the USA, the corporate alternative minimum tax on adjusted financial statements income introduced by the Inflation Reduction Act

became effective on 1 January 2023. The Group will continue to review the regulations and guidance as they are issued. However, the

Group’s tax liability was not increased as a result of the corporate alternative minimum tax in 2023 and it is not expected that it will

materially increase the Group’s future effective tax rate.

Tax in the consolidated statement of comprehensive income

The tax relating to each component of other comprehensive income can be found in the consolidated statement of comprehensive

income.

Tax included directly in equity

Tax included directly in equity comprises a £9m credit (2022: £1m) relating to share-based payments and deductible costs on issuing

other equity instruments.

Deferred tax assets and liabilities

The deferred tax amounts on the balance sheet were as follows:

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| UK Tax Group | 4,081 | 4,925 |
| US Intermediate Holding Company Tax Group ('IHC Tax Group') | 973 | 1,094 |
| Barclays Bank PLC's US Branch Tax Group | 386 | 482 |
| Other (outside the UK and US tax groups) | 520 | 490 |
| Deferred tax asset | 5,960 | 6,991 |
| Deferred tax liability | (22) | (16) |
| Net deferred tax | 5,938 | 6,975 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 437 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

US deferred tax assets in the IHC and US Branch Tax Groups

The deferred tax asset in the IHC Tax Group of £973m (2022: £1,094m) includes £35m (2022: £21m) relating to tax losses, with the

balance relating to temporary differences. The deferred tax asset in Barclays Bank PLC’s US Branch Tax Group of £386m (2022:

£482m) relates entirely to temporary differences.

In relation to the IHC Tax Group, these temporary differences include £387m (2022 : £434m) arising from New York State and City prior

net operating loss conversion which can be carried forward and will expire in 2034. Business profit forecasts indicate that all of the New

York State attributable amounts will be utilised prior to expiry and that £38m of the New York City attributable amounts previously

recognised will not be utilised prior to expiry.  Accordingly, in the current period the deferred tax asset recognised has been reduced by

£38m.

UK Tax Group deferred tax asset

The deferred tax asset in the UK Tax Group of £4,081m (2022: £4,925m) includes £1,566m (2022: £1,535m) relating to tax losses, with

the balance relating to temporary differences. There is no time limit on utilisation of UK tax losses and business profit forecasts indicate

that these losses will be fully recovered.

Other deferred tax assets (outside the UK and US tax groups)

The deferred tax asset of £520m (2022: £490m) in other entities within the Group includes £147m (2022: £90m) relating to tax losses.

These deferred tax assets relate to a number of different territories and their recognition is based on profit forecasts or local country

law which indicate that it is probable that those deferred tax assets will be fully recovered.

Of the deferred tax asset of £520m (2022: £490m), an amount of £20m (2022: £33m) relates to entities which have suffered a loss in

either the current or prior year and for which the utilisation of the deferred tax is dependent on future taxable profits. This has been

taken into account in reaching the above conclusion that these deferred tax assets will be fully recovered in the future.

The table below shows movements on deferred tax assets and liabilities during the year. The amounts are different from those

disclosed on the balance sheet and in the preceding table as they are presented before offsetting asset and liability balances where

there is a legal right to set-off and an intention to settle on a net basis.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | Fixed asset  timing  differences | Fair value  through other  comprehensive  income | Cash flow  hedges | Retirement  benefit  obligations | Loan  impairment  allowance | Own Credit | Share-based  payments and  deferred  compensation | Other  temporary  differences | Tax losses  carried  forward | Total |
|  | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m |
| Assets | 1,296 | 675 | 2,875 | 40 | 702 | — | 433 | 1,280 | 1,646 | 8,947 |
| Liabilities | (77) | — | — | (1,315) | — | (190) | — | (390) | — | (1,972) |
| As at 1 January 2023 | 1,219 | 675 | 2,875 | (1,275) | 702 | (190) | 433 | 890 | 1,646 | 6,975 |
| Income statement | (63) | (26) | — | (26) | (43) | — | 43 | (46) | 105 | (56) |
| Other comprehensive  income and reserves | — | (78) | (1,398) | 327 | — | 273 | (14) | — | — | (890) |
| Other movements | (3) | — | — | (2) | (31) | 2 | (13) | (41) | (3) | (91) |
|  | 1,153 | 571 | 1,477 | (976) | 628 | 85 | 449 | 803 | 1,748 | 5,938 |
| Assets | 1,277 | 571 | 1,477 | 38 | 628 | 85 | 449 | 1,146 | 1,748 | 7,419 |
| Liabilities | (124) | — | — | (1,014) | — | — | — | (343) | — | (1,481) |
| As at 31 December  2023 | 1,153 | 571 | 1,477 | (976) | 628 | 85 | 449 | 803 | 1,748 | 5,938 |
|  |  |  |  |  |  |  |  |  |  |  |
| Assets | 1,647 | 155 | 521 | 40 | 693 | 426 | 414 | 1,248 | 1,220 | 6,364 |
| Liabilities | (42) | — | — | (1,674) | — | — | — | (66) | — | (1,782) |
| As at 1 January 2022 | 1,605 | 155 | 521 | (1,634) | 693 | 426 | 414 | 1,182 | 1,220 | 4,582 |
| Income statement | (458) | (6) | — | (3) | (11) | — | 14 | (400) | 426 | (438) |
| Other comprehensive  income and reserves | — | 523 | 2,354 | 357 | — | (616) | (17) | — | — | 2,601 |
| Other movements | 72 | 3 | — | 5 | 20 | — | 22 | 108 | — | 230 |
|  | 1,219 | 675 | 2,875 | (1,275) | 702 | (190) | 433 | 890 | 1,646 | 6,975 |
| Assets | 1,296 | 675 | 2,875 | 40 | 702 | — | 433 | 1,280 | 1,646 | 8,947 |
| Liabilities | (77) | — | — | (1,315) | — | (190) | — | (390) | — | (1,972) |
| As at 31 December  2022 | 1,219 | 675 | 2,875 | (1,275) | 702 | (190) | 433 | 890 | 1,646 | 6,975 |

Other movements include the impact of changes in foreign exchange rates as well as deferred tax amounts relating to acquisitions and

disposals.

The amount of deferred tax assets expected to be recovered after more than 12 months is £5,325m (2022: £8,155m). The amount of

deferred tax liability expected to be settled after more than 12 months is £1,173m (2022: £1,864m). These amounts are before

offsetting asset and liability balances where there is a legal right to set-off and an intention to settle on a net basis.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 438 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

Unrecognised deferred tax

Tax losses and temporary differences

Deferred tax assets have not been recognised in respect of gross deductible temporary differences of £527m (2022: £111m), unused

tax credits of £381m (2022: £323m), and gross tax losses of £21,681m (2022: £22,537m). The tax losses include capital losses of

£3,965m (2022: £3,935m). Of these tax losses, £79m (2022: £149m) expire within five years, £13m (2022: £401m) expire within six to

ten years, £10,504m (2022: £10,393m) expire within eleven to twenty years and £11,085m (2022: £11,594m) can be carried forward

indefinitely. Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable

profits and gains will be available against which they can be utilised.

Group investments in subsidiaries, branches and associates

Deferred tax is not recognised in respect of the value of the Group's investments in subsidiaries, branches and associates where the

Group is able to control the timing of the reversal of the temporary differences and it is probable that such differences will not reverse in

the foreseeable future. The aggregate amount of these temporary differences for which deferred tax liabilities have not been

recognised was £873m (2022: £852m).

10 Earnings per share

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Profit attributable to ordinary equity holders of the parent | 4,274 | 5,023 | 6,205 |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | million | million | million |
| Basic weighted average number of shares in issue | 15,445 | 16,333 | 16,985 |
| Number of potential ordinary shares | 450 | 534 | 435 |
| Diluted weighted average number of shares | 15,895 | 16,867 | 17,420 |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | Basic earnings per share | | | Diluted earnings per share | | |
|  | 2023 | 2022 | 2021 | 2023 | 2022 | 2021 |
|  | p | p | p | p | p | p |
| Earnings per ordinary share | 27.7 | 30.8 | 36.5 | 26.9 | 29.8 | 35.6 |

The calculation of basic earnings per share is based on the profit attributable to equity holders of the parent and the basic weighted

average number of shares excluding treasury shares held in employee benefit trusts or held for trading. When calculating the diluted

earnings per share, the weighted average number of shares in issue is adjusted for the effects of all expected dilutive potential ordinary

shares held in respect of Barclays PLC, totalling 450m (2022:  534m, 2021: 435m) shares. The number of share options outstanding,

under schemes that were considered to be potentially dilutive was 750m (2022: 789m, 2021: 688m) in total. These options have strike

prices ranging from £0.83  to £1.51.

Of the total number of employee share options and share awards at 31 December 2023, 39m ( 2022 : 27m, 2021: 5m) were anti-dilutive.

The  888m decrease (2022: 652m decrease, 2021: 315m decrease) in the basic weighted average number of shares is primarily due to

the impact of the share buy-back programmes completed each year.

11 Dividends on ordinary shares

The Directors have approved a total dividend in respect of  2023  of  8.00 p  per ordinary share of   25p each . The full year dividend for 2023

of  5.30 p per ordinary share will be paid on 3 April 2024 to shareholders on the Share Register on 1 March 2024. On 31 December 2023,

there were 15,155m ordinary shares in issue. The financial statements for the year ended 31 December 2023 do not reflect this

dividend, which will be accounted for in shareholders’ equity as an appropriation of retained profits in the year ending 31 December

2024.

The Directors have confirmed their intention to initiate a share buyback of up to £1bn   after the balance sheet date. The proposed

share buyback  is expected to  commence in the first quarter of 2024. The financial statements for the year ended 31 December 2023

do not reflect the impact of the proposed share buyback, which will be accounted for as and when shares are repurchased by the

Company.

The 2023 financial statements include the 2023 interim dividend of £417m (2022: £364m, 2021: £339m); a full year dividend declared in

relation to 2022 of £793m (2021: £664m, 2020: £173m ) and two share buyback programmes totalling £1,250m (2022: £1,500m, 2021:

£1,200m). Dividends and share buybacks are funded out of distributable reserves.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 439 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| For the year ended 31 December 2023 | | | | | | | | | | |

#### Assets and liabilities held at fair value

The notes included in this section focus on assets and liabilities the Group holds and recognises at fair value. Detail regarding the

Group’s approach to managing market risk can be found in the Market risk management section.

12 Trading portfolio

Accounting for trading portfolio assets and liabilities

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 | |
|  | 2023 | 2022 | 2023 | 2022 |
|  | £m | £m | £m | £m |
| Debt securities and other eligible bills | 75,498 | 55,475 | (40,547) | (39,531) |
| Equity securities | 86,353 | 65,031 | (18,122) | (33,393) |
| Traded loans | 12,653 | 13,198 | — | — |
| Commodities | 101 | 109 | — | — |
| Trading portfolio assets/(liabilities) | 174,605 | 133,813 | (58,669) | (72,924) |

13 Financial assets at fair value through the income statement

Accounting for financial assets designated at fair value

Financial assets, other than those held for trading, are classified in this category if they are so irrevocably designated at inception and

the use of the designation removes or significantly reduces an accounting mismatch.

Subsequent changes in fair value for these instruments are recognised in the income statement in net investment income, except if

reporting it in trading income reduces an accounting mismatch.

The details on how the fair value amounts are derived for financial assets at fair value are described in Note 17.

Accounting for financial assets mandatorily at fair value

Financial assets that are held for trading are recognised at fair value through profit or loss. In addition, financial assets are held at fair

value through profit or loss if they do not contain contractual terms that give rise on specified dates to cash flows that are SPPI, or if the

financial asset is not held in a business model that is either (i) a business model to collect the contractual cash flows or (ii) a business

model that is achieved by both collecting contractual cash flows and selling.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | Designated at fair value | | Mandatorily at fair value | | Total | |
|  | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
|  | £m | £m | £m | £m | £m | £m |
| Loans and advances | 3,082 | 3,658 | 44,557 | 35,771 | 47,639 | 39,429 |
| Debt securities | 130 | 205 | 2,456 | 3,044 | 2,586 | 3,249 |
| Equity securities | — | — | 7,185 | 6,091 | 7,185 | 6,091 |
| Reverse repurchase agreements and other  similar secured lending | — | — | 149,131 | 164,681 | 149,131 | 164,681 |
| Other financial assets | — | 1 | 110 | 117 | 110 | 118 |
| Financial assets at fair value through the  income statement | 3,212 | 3,864 | 203,439 | 209,704 | 206,651 | 213,568 |

Credit risk of financial assets 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 for loans and advances. The table does not include debt securities designated at

fair value  as they have minimal exposure to credit risk due to limited gross exposure.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | Maximum exposure as at 31 December | | Changes in fair value during the year  ended | | Cumulative changes in fair value from  inception | |
|  | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
|  | £m | £m | £m | £m | £m | £m |
| Loans and advances designated at fair value,  attributable to credit risk | 3,081 | 3,658 | 3 | 10 | (3) | (9) |
| Value mitigated by related credit derivatives | 613 | 855 | (5) | (1) | (5) | (1) |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 440 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

14 Derivative financial instruments

Accounting for derivatives

Derivative instruments are contracts whose value is derived from one or more underlying financial instruments or indices defined in the

contract. They include swaps, forward-rate agreements, futures, options and combinations of these instruments and primarily affect

the Group’s net interest income, net trading income and derivative assets and liabilities. Notional amounts of the contracts are not

recorded on the balance sheet. Derivatives are used to hedge interest rate, credit risk, inflation risk, exchange rate, commodity equity

exposures, and exposures to certain indices such as house price indices and retail price indices related to non-trading positions.

All derivative instruments are held at fair value through profit or loss, except for derivatives that are in a designated cash flow or net

investment hedge accounting relationship. Derivatives are classified as assets when their fair value is positive or as liabilities when their

fair value is negative.

Hedge accounting

The Group applies the requirements of IAS 39  Financial Instruments: Recognition and Measurement for hedge accounting purposes.

The Group applies hedge accounting to represent the economic effects of its interest rate, currency and contractually-linked inflation

risk management strategies. Where derivatives are held for risk management purposes, and when transactions meet the required

criteria for documentation and hedge effectiveness, the Group applies fair value hedge accounting, cash flow hedge accounting, or

hedging of a net investment in a foreign operation, as appropriate to the risks being hedged.

Fair value hedge accounting

Changes in fair value of derivatives that qualify and are designated as fair value hedges are recorded in the income statement, together

with changes in the fair value of the hedged asset or liability that are attributable to the hedged risk. The fair value changes adjust the

carrying value of the hedged asset or liability held at amortised cost.

If hedge relationships no longer meet the criteria for hedge accounting, hedge accounting is discontinued. For fair value hedges of

interest rate risk, the fair value adjustment to the hedged item is amortised to the income statement over the period to maturity of the

previously designated hedge relationship using the effective interest method. If the hedged item is sold or repaid, the unamortised fair

value adjustment is recognised immediately in the income statement. For items classified as fair value through other comprehensive

income, the hedge accounting adjustment is included in other comprehensive income.

Cash flow hedge accounting

For qualifying cash flow hedges, the fair value gain or loss associated with the effective portion of the cash flow hedge is recognised

initially in other comprehensive income, and then recycled to the income statement in the periods when the hedged item will affect

profit or loss. Any ineffective portion of the gain or loss on the hedging instrument is recognised in the income statement immediately.

When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain

or loss existing in equity at that time remains in equity and is recognised when the hedged item is ultimately recognised in the income

statement. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was recognised in equity is

immediately transferred to the income statement.

Hedges of net investments

The Group’s net investments in foreign operations, including monetary items accounted for as part of the net investment, are hedged

for foreign currency risks using both derivatives and foreign currency borrowings. Hedges of net investments are accounted for

similarly to cash flow hedges; the effective portion of the gain or loss on the hedging instrument is being recognised directly in other

comprehensive income and the ineffective portion being recognised immediately in the income statement. The cumulative gain or loss

recognised in other comprehensive income is recognised in the income statement on the disposal or partial disposal of the foreign

operation, or other reductions in the Group’s investment in the operation.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Total derivatives |  | | | | | |
|  | 2023 | | | 2022 | | |
|  | Notional contract  amount | Fair value | | Notional contract  amount | Fair value | |
| Assets | Liabilities | Assets | Liabilities |
|  | £m | £m | £m | £m | £m | £m |
| Total derivative assets/(liabilities) held for trading | 64,993,491 | 254,643 | (249,458) | 52,689,773 | 301,647 | (288,573) |
| Total derivative assets/(liabilities) held for risk  management | 299,576 | 2,193 | (586) | 285,505 | 733 | (1,047) |
| Derivative assets/(liabilities) | 65,293,067 | 256,836 | (250,044) | 52,975,278 | 302,380 | (289,620) |

Further information on netting arrangements of derivative financial instruments can be found within Note 18.

The fair values and notional amounts of derivative instruments held for trading and held for risk management are set out in the following

table:

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 441 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
| Derivatives held for trading and held for risk management | |  |  |  |  |  |
|  | 2023 | | | 2022 | | |
|  | Notional  contract  amount | Fair value | | Notional  contract  amount | Fair value | |
|  | Assets | Liabilities | Assets | Liabilities |
|  | £m | £m | £m | £m | £m | £m |
| Derivatives held for trading |  |  |  |  |  |  |
| Foreign exchange derivatives |  |  |  |  |  |  |
| OTC derivatives | 6,536,257 | 86,987 | (82,711) | 5,775,206 | 108,833 | (103,439) |
| Derivatives cleared by central counterparty | 186,672 | 529 | (512) | 113,455 | 440 | (473) |
| Exchange traded derivatives | 17,899 | 2 | (2) | 19,426 | 15 | (6) |
| Foreign exchange derivatives | 6,740,828 | 87,518 | (83,225) | 5,908,087 | 109,288 | (103,918) |
| Interest rate derivatives |  |  |  |  |  |  |
| OTC derivatives | 19,671,577 | 104,618 | (92,467) | 14,924,915 | 129,920 | (116,752) |
| Derivatives cleared by central counterparty | 27,662,853 | 1,989 | (2,065) | 21,927,570 | 2,319 | (2,371) |
| Exchange traded derivatives | 6,800,161 | 2,824 | (2,895) | 5,654,126 | 2,257 | (2,167) |
| Interest rate derivatives | 54,134,591 | 109,431 | (97,427) | 42,506,611 | 134,496 | (121,290) |
| Credit derivatives |  |  |  |  |  |  |
| OTC derivatives | 587,472 | 4,936 | (6,005) | 619,843 | 4,262 | (4,731) |
| Derivatives cleared by central counterparty | 860,878 | 2,726 | (2,625) | 1,107,377 | 1,161 | (1,321) |
| Credit derivatives | 1,448,350 | 7,662 | (8,630) | 1,727,220 | 5,423 | (6,052) |
| Equity and stock index derivatives |  |  |  |  |  |  |
| OTC derivatives | 448,780 | 17,792 | (25,779) | 410,276 | 12,679 | (16,724) |
| Exchange traded derivatives | 2,017,045 | 30,379 | (32,549) | 1,924,613 | 35,986 | (36,774) |
| Equity and stock index derivatives | 2,465,825 | 48,171 | (58,328) | 2,334,889 | 48,665 | (53,498) |
| Commodity derivatives |  |  |  |  |  |  |
| OTC derivatives | 4,734 | 44 | (4) | 4,411 | 14 | (51) |
| Exchange traded derivatives | 199,163 | 1,817 | (1,844) | 208,555 | 3,761 | (3,764) |
| Commodity derivatives | 203,897 | 1,861 | (1,848) | 212,966 | 3,775 | (3,815) |
| Derivative assets/(liabilities) held for trading | 64,993,491 | 254,643 | (249,458) | 52,689,773 | 301,647 | (288,573) |
| Total OTC derivatives | 27,248,820 | 214,377 | (206,966) | 21,734,651 | 255,708 | (241,697) |
| Total derivatives cleared by central counterparty | 28,710,403 | 5,244 | (5,202) | 23,148,402 | 3,920 | (4,165) |
| Total exchange traded derivatives | 9,034,268 | 35,022 | (37,290) | 7,806,720 | 42,019 | (42,711) |
| Derivative assets/(liabilities) held for trading | 64,993,491 | 254,643 | (249,458) | 52,689,773 | 301,647 | (288,573) |
| Derivatives held for risk management |  |  |  |  |  |  |
| Derivatives designated as cash flow hedges |  |  |  |  |  |  |
| OTC foreign exchange derivatives | 26,661 | 1,904 | (8) | 11,946 | 549 | (211) |
| OTC interest rate derivatives | 195 | — | — | 266 | — | (1) |
| Interest rate derivatives cleared by central  counterparty | 130,961 | — | — | 143,271 | — | — |
| Derivatives designated as cash flow hedges | 157,817 | 1,904 | (8) | 155,483 | 549 | (212) |
| Derivatives designated as fair value hedges |  |  |  |  |  |  |
| OTC interest rate derivatives | 8,697 | 178 | (533) | 7,814 | 83 | (815) |
| Interest rate derivatives cleared by central  counterparty | 129,318 | — | — | 118,246 | — | — |
| Derivatives designated as fair value hedges | 138,015 | 178 | (533) | 126,060 | 83 | (815) |
| Derivatives designated as hedges of net  investments |  |  |  |  |  |  |
| OTC foreign exchange derivatives | 3,744 | 111 | (45) | 3,962 | 101 | (20) |
| Derivatives designated as hedges of net  investments | 3,744 | 111 | (45) | 3,962 | 101 | (20) |
| Derivative assets/(liabilities) held for risk  management | 299,576 | 2,193 | (586) | 285,505 | 733 | (1,047) |
| Total OTC derivatives | 39,297 | 2,193 | (586) | 23,988 | 733 | (1,047) |
| Total derivatives cleared by central counterparty | 260,279 | — | — | 261,517 | — | — |
| Derivative assets/(liabilities) held for risk  management | 299,576 | 2,193 | (586) | 285,505 | 733 | (1,047) |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 442 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

Hedge accounting

Hedge accounting is applied predominantly for the following risks:

▪ Interest rate risk – arises due to a mismatch between fixed interest rates and floating interest rates. Interest rate risk also includes

exposure to inflation risk for certain types of investments.

▪ Currency risk – arises due to assets or liabilities being denominated in different currencies than the functional currency of the relevant

entity. At a consolidated level, currency risk also arises when the functional currency of subsidiaries are different from the parent.

▪ Contractually linked inflation risk – arises from financial instruments within contractually specified inflation risk. The Group does not

hedge inflation risk that arises from other activities.

In order to hedge these risks, the Group uses the following hedging instruments:

▪ Interest rate derivatives to swap interest rate exposures into either fixed or variable rates.

▪ Currency derivatives to swap foreign currency exposures into the entity’s functional currency, and net investment exposure to local

currency.

▪ Inflation derivatives to swap inflation exposure into either fixed or variable interest rates.

In some cases, certain items which are economically hedged may be ineligible hedged items for the purposes of IAS 39, such as core

deposits and equity. In these instances, a proxy hedging solution can be utilised whereby portfolios of floating rate assets are

designated as eligible hedged items in cash flow hedges.

In some hedging relationships, the Group designates risk components of hedged items as follows:

▪ Benchmark interest rate risk as a component of interest rate risk, such as the Risk Free Rate (RFR) component.

▪ Inflation risk as a contractually specified component of a debt instrument.

▪ Spot exchange rate risk for foreign currency financial assets or financial liabilities.

▪ Components of cash flows of hedged items, for example certain interest payments for part of the life of an instrument.

Using the benchmark interest rate risk results in other risks, such as credit risk and liquidity risk, being excluded from the hedge

accounting relationship.

In respect of many of the Group’s hedge accounting relationships, the hedged item and hedging instrument change frequently due to

the dynamic nature of the risk management and hedge accounting strategy. The Group applies hedge accounting to dynamic

scenarios, predominantly in relation to interest rate risk, with a combination of hedged items in order for its financial statements to

reflect as closely as possible the economic risk management undertaken. In some cases, if the hedge accounting objective changes,

the relevant hedge accounting relationship is de-designated and is replaced with a different hedge accounting relationship.

Changes in the GBP value of net investments due to foreign currency movements are captured in the currency translation reserve,

resulting in a movement in CET1 capital. The Group mitigates this by matching the CET1 capital movements to the revaluation of the

foreign currency RWA exposures. Net investment hedges are designated where necessary to reduce the exposure to movement in a

particular exchange rate to within limits mandated by Risk. As far as possible, existing external currency liabilities are designated as the

hedging instruments.

The hedging instruments share the same risk exposures as the hedged items. Hedge effectiveness is determined with reference to

quantitative tests, predominantly regression testing, but to the extent hedging instruments are exposed to different risks than the

hedged items, this could result in hedge ineffectiveness or hedge accounting failures.

Sources of ineffectiveness include the following:

▪ Mismatches between the contractual terms of the hedged item and hedging instrument, including basis differences.

▪ Changes in credit risk of the hedging instruments.

▪ If a hedging relationship becomes over-hedged, for example in hedges of net investments if the net asset value designated at the

start of the period falls below the amount of the hedging instrument.

▪ Cash flow hedges using external swaps with non-zero fair values.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 443 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Hedged items in fair value hedges |  |  |  |  |  |
|  |  | Accumulated fair value adjustment  included in carrying amount | |  |  |
| Hedged item statement of financial position classification and  risk category | Carrying amount | Total | Of which:  Accumulated fair  value adjustment  on items no longer  in a hedge  relationship | Change in fair  value used as a  basis to determine  ineffectiveness | Hedge  ineffectiveness  recognised in the  income  statements1 |
| £m | £m | £m | £m | £m |
| 2023 |  |  |  |  |  |
| Assets |  |  |  |  |  |
| Loans and advances at amortised cost |  |  |  |  |  |
| - Interest rate risk | 3,543 | (3,193) | (1,867) | 113 | 11 |
| - Inflation risk | 450 | 246 | — | 3 | (5) |
| Debt securities classified at amortised cost |  |  |  |  |  |
| - Interest rate risk | 2,390 | (24) | (21) | 49 | 21 |
| - Inflation risk | 8,119 | (836) | (57) | (30) | (26) |
| Financial assets at fair value through other comprehensive  income |  |  |  |  |  |
| - Interest rate risk | 42,420 | (1,392) | (667) | 1,244 | 197 |
| - Inflation risk | 5,237 | (202) | (176) | (84) | (10) |
| Total assets | 62,159 | (5,401) | (2,788) | 1,295 | 188 |
| Liabilities |  |  |  |  |  |
| Debt securities in issue |  |  |  |  |  |
| - Interest rate risk | (64,734) | 3,105 | 1,034 | (1,462) | (24) |
| Total liabilities | (64,734) | 3,105 | 1,034 | (1,462) | (24) |
| Total hedged items | (2,575) | (2,296) | (1,754) | (167) | 164 |
|  |  |  |  |  |  |
| 2022 |  |  |  |  |  |
| Assets |  |  |  |  |  |
| Loans and advances at amortised cost |  |  |  |  |  |
| - Interest rate risk | 4,906 | (3,474) | (1,268) | (4,405) | 44 |
| - Inflation risk | 445 | 243 | — | (111) | 2 |
| Debt securities classified at amortised cost |  |  |  |  |  |
| - Interest rate risk | 159 | (19) | (11) | (133) | (20) |
| - Inflation risk | 4,858 | (1,304) | (1) | (1,693) | (16) |
| Financial assets at fair value through other comprehensive  income |  |  |  |  |  |
| - Interest rate risk | 33,583 | (3,758) | (232) | (4,799) | 168 |
| - Inflation risk | 8,514 | (261) | 14 | (804) | (9) |
| Total assets | 52,465 | (8,573) | (1,498) | (11,945) | 169 |
| Liabilities |  |  |  |  |  |
| Debt securities in issue |  |  |  |  |  |
| - Interest rate risk | (51,893) | 4,825 | 527 | 5,946 | 13 |
| Total liabilities | (51,893) | 4,825 | 527 | 5,946 | 13 |
| Total hedged items | 572 | (3,748) | (971) | (5,999) | 182 |

Note

1 Hedge ineffectiveness is recognised in net interest income.

For items classified as fair value through other comprehensive income, the hedge accounting adjustment is not included in the carrying

amount, but rather adjusts other comprehensive income.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 444 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

The following table shows the fair value hedging instruments which are carried on the Group’s balance sheet:

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  |  | Carrying value | | | Nominal amount | Change in fair value used as a  basis to determine  ineffectiveness |
|  |  | Derivative assets | Derivative liabilities | Loan liabilities |
| Hedge type | Risk category | £m | £m | £m | £m | £m |
| As at 31 December 2023 |  |  |  |  |  |  |
| Fair value | Interest rate risk | 2 | (2) | — | 123,016 | 261 |
|  | Inflation risk | 176 | (531) | — | 14,999 | 70 |
|  | Total | 178 | (533) | — | 138,015 | 331 |
|  |  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |  |
| Fair value | Interest rate risk | — | — | — | 109,761 | 3,596 |
|  | Inflation risk | 83 | (815) | — | 16,299 | 2,585 |
|  | Total | 83 | (815) | — | 126,060 | 6,181 |

The following table profiles the expected notional values of current hedging instruments in future years:

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | 2023 | 2024 | 2025 | 2026 | 2027 | 2028 | 2029 and  later |
| As at 31 December | £m | £m | £m | £m | £m | £m | £m |
| Fair value hedges of: |  |  |  |  |  |  |  |
| Interest rate risk (outstanding notional amount) | 123,016 | 107,339 | 94,291 | 75,792 | 61,853 | 52,346 | 47,646 |
| Inflation risk (outstanding notional amount) | 14,999 | 14,671 | 14,433 | 12,140 | 9,520 | 7,627 | 7,115 |

There are 1,996 (2022: 1,796) interest rate risk fair value hedges with an average fixed rate of 1.64% (2022: 1.97%) across the

relationships and 136 (2022: 94) inflation risk fair value hedges with an average rate of 0.85% (2022: 0.54%) across the relationships.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 445 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| Hedged items in cash flow hedges and hedges of net investments in foreign operations | | | | | | | |
| Description of hedge  relationship and hedged risk | Change in value of  hedged item used  as the basis for  recognising  ineffectiveness | Balance in cash  flow hedging  reserve for  continuing hedges | Balance in currency  translation reserve  for continuing  hedges | Balances remaining  in cash flow  hedging reserve  for which hedge  accounting is no  longer applied | Balances remaining  in currency  translation reserve  for which hedge  accounting is no  longer applied | Hedging (gains) or  losses recognised  in other  comprehensive  income | Hedge  ineffectiveness  recognised in the  income statement1 |
| £m | £m | £m | £m | £m | £m | £m |
| 2023 |  |  |  |  |  |  |  |
| Cash flow hedge of: |  |  |  |  |  |  |  |
| Interest rate risk |  |  |  |  |  |  |  |
| Loans and advances at  amortised cost | (1,172) | 395 | — | 2,069 | — | (1,172) | 34 |
| Cash and balances at Central  Banks | (1,371) | 470 | — | 2,051 | — | (1,371) | 115 |
| Foreign exchange risk |  |  |  |  |  |  |  |
| Loans and advances at  amortised cost | (463) | 30 | — | — | — | (463) | 6 |
| Debt securities classified at  amortised cost | (1,088) | 333 | — | — | — | (1,088) | 1 |
| Inflation risk |  |  |  |  |  |  |  |
| Debt securities classified at  amortised cost | (313) | (181) | — | 21 | — | (313) | — |
| Total cash flow hedge | (4,407) | 1,047 | — | 4,141 | — | (4,407) | 156 |
| Hedge of net investment in  foreign operations |  |  |  |  |  |  |  |
| USD foreign operations | (595) | — | 1,421 | — | — | (595) | — |
| EUR foreign operations | (113) | — | 33 | — | — | (113) | — |
| Other foreign operations | (118) | — | 119 | — | 23 | (118) | — |
| Total foreign operations | (826) | — | 1,573 | — | 23 | (826) | — |
|  |  |  |  |  |  |  |  |
| 2022 |  |  |  |  |  |  |  |
| Cash flow hedge of: |  |  |  |  |  |  |  |
| Interest rate risk |  |  |  |  |  |  |  |
| Loans and advances at  amortised cost | 4,059 | 2,990 |  | 1,374 |  | 4,059 | (42) |
| Cash and balances at Central  Banks | 4,389 | 3,467 |  | 1,484 |  | 4,389 | (41) |
| Foreign exchange risk |  |  |  |  |  |  |  |
| Loans and advances at  amortised cost | 3 | (13) | — | — | — | 3 | 2 |
| Debt securities classified at  amortised cost | 483 | 601 | — | — | — | 483 | — |
| Inflation risk |  |  |  |  |  |  |  |
| Debt securities classified at  amortised cost | 362 | 142 | — | 16 | — | 98 | 33 |
| Total cash flow hedge | 9,296 | 7,187 | — | 2,874 | — | 9,032 | (48) |
| Hedge of net investment in  foreign operations |  |  |  |  |  |  |  |
| USD foreign operations | 1,240 | — | 1,886 | — | — | 1,240 | — |
| EUR foreign operations | 265 | — | 141 | — | — | 265 | — |
| Other foreign operations | 34 | — | 242 | — | 23 | 34 | — |
| Total foreign operations | 1,539 | — | 2,269 | — | 23 | 1,539 | — |

Note

1 Hedge ineffectiveness is recognised in net interest income.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 446 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

The following table shows the cash flow and net investment hedging instruments which are carried on the Group’s balance sheet:

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  |  | Carrying value | | | Nominal amount | Change in fair value used as a  basis to determine  ineffectiveness |
|  |  | Derivative assets | Derivative liabilities | Loan liabilities |
| Hedge type | Risk category | £m | £m | £m | £m | £m |
| As at 31 December 2023 |  |  |  |  |  |  |
| Cash flow | Interest rate risk | — | — | — | 128,349 | 2,692 |
|  | Foreign exchange risk | 1,904 | (8) | — | 26,661 | 1,558 |
|  | Inflation risk | — | — | — | 2,807 | 313 |
|  | Total | 1,904 | (8) | — | 157,817 | 4,563 |
| Net investment | Foreign exchange risk | 111 | (45) | (13,157) | 16,901 | 826 |
|  |  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |  |
| Cash flow | Interest rate risk | — | (1) | — | 140,901 | (8,531) |
|  | Foreign exchange risk | 549 | (211) | — | 11,946 | (484) |
|  | Inflation riskc | — | — | — | 2,636 | (329) |
|  | Total | 549 | (212) | — | 155,483 | (9,344) |
| Net investment | Foreign exchange risk | 101 | (20) | (12,824) | 16,786 | (1,539) |

There are 50 (2022: 58) foreign exchange risk cash flow hedges with an average foreign exchange rate of 147.94  JPY:1 GBP ( 2022:

148.00 JPY:1 GBP) across the relationships and 8 (2022: nil) foreign exchange risk cash flow hedges with an average foreign exchange

rate of 1.25  USD:1 GBP (2022: nil) across the relationships.

The effect on the income statement and other comprehensive income of recycling amounts in respect of cash flow hedges and net

investment hedges of foreign operations is set out in the following table:

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | 2023 | | 2022 | |
|  | Amount recycled  from other  comprehensive  income due to  hedged item  affecting income  statement | Amount recycled  from other  comprehensive  income due to sale  of investment, or  cash flows no  longer expected to  occur | Amount recycled  from other  comprehensive  income due to  hedged item  affecting income  statement | Amount recycled  from other  comprehensive  income due to sale  of investment, or  cash flows no  longer expected to  occur |
| Description of hedge relationship and hedged risk | £m | £m | £m | £m |
| Cash flow hedge of interest rate risk |  |  |  |  |
| Recycled to net interest income | (1,752) | 2 | (320) | (13) |
| Cash flow hedge of foreign exchange risk |  |  |  |  |
| Recycled to trading income | 1,327 | — | (6) | — |
| Hedge of net investment in foreign operations |  |  |  |  |
| Recycled to trading income | — | (6) | — | (58) |

A detailed reconciliation of the movements of the cash flow hedging reserve and the currency translation reserve is as follows:

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | 2023 | | 2022 | |
|  | Cash flow hedging  reserve | Currency  translation reserve | Cash flow hedging  reserve | Currency  translation reserve |
|  | £m | £m | £m | £m |
| Balance on 1 January | (7,235) | 4,772 | (853) | 2,740 |
| Currency translation movements | 40 | (1,942) | (20) | 3,513 |
| Hedging gains/(losses) for the year | 4,407 | 826 | (9,032) | (1,539) |
| Amounts reclassified in relation to cash flows affecting profit or loss | 423 | 6 | 339 | 58 |
| Tax | (1,342) | 9 | 2,331 | — |
| Balance on 31 December | (3,707) | 3,671 | (7,235) | 4,772 |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 447 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

15 Financial assets at fair value through other comprehensive income

Accounting for financial assets at fair value through other comprehensive income (FVOCI)

Financial assets that are debt instruments held in a business model that is achieved by both collecting contractual cash flows and selling

and that contain contractual terms that give rise on specified dates to cash flows that are SPPI are measured at FVOCI. They are

subsequently remeasured at fair value and changes therein (except for those relating to impairment, interest income and foreign

currency exchange gains and losses) are recognised in other comprehensive income until the assets are sold. Interest (calculated using

the effective interest method) is recognised in the income statement in net interest income (Note 3). Upon disposal, the cumulative

gain or loss recognised in other comprehensive income is included in net investment income (Note 6).

In determining whether the business model is achieved by both collecting contractual cash flows and selling financial assets, it is

determined that both collecting contractual cash flows and selling financial assets are integral to achieving the objective of the business

model. The Group will consider past sales and expectations about future sales to establish if the business model is achieved.

For equity securities that are not held for trading, the Group may make an irrevocable election on initial recognition to present

subsequent changes in the fair value of the instrument in other comprehensive income (except for dividend income which is recognised

in profit or loss).

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| Debt securities and other eligible bills | 71,059 | 64,832 |
| Equity securities | 6 | 8 |
| Loans and advances | 771 | 222 |
| Financial assets at fair value through other comprehensive income | 71,836 | 65,062 |

16 Financial liabilities designated at fair value

Accounting for liabilities designated at fair value through profit and loss

In accordance with IFRS 9, financial liabilities may be designated at fair value, with gains and losses taken to the income statement within

net trading income (Note 5) and net investment income (Note 6). Movements in own credit are reported through other comprehensive

income, unless the effects of changes in the liability's credit risk would create or enlarge an accounting mismatch in P&L. In these

scenarios, all gains and losses on that liability (including the effects of changes in the credit risk of the liability) are presented in P&L. On

derecognition of the financial liability no amount relating to own credit risk is recycled to the income statement. 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 14).

The details on how the fair value amounts are arrived at for financial liabilities designated at fair value are described in Note 17.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  | 2023 | | 2022 | |
|  | Fair value | Contractual  amount due  on maturity | Fair value | Contractual  amount due  on maturity |
|  | £m | £m | £m | £m |
| Debt securities | 68,261 | 82,820 | 57,846 | 73,757 |
| Deposits | 43,552 | 44,862 | 41,037 | 42,455 |
| Repurchase agreements and other similar secured borrowing | 185,716 | 186,593 | 172,746 | 173,511 |
| Other financial liabilities | 10 | 10 | 8 | 8 |
| Financial liabilities designated at fair value | 297,539 | 314,285 | 271,637 | 289,731 |

The cumulative own credit net loss recognised is £307m (2022: £674m gain).

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

17 Fair value of financial instruments

Accounting for financial assets and liabilities – fair values

Financial instruments that are held for trading are recognised at fair value through profit or loss. In addition, financial assets are held at

fair value through profit or loss if they do not contain contractual terms that give rise on specified dates to cash flows that are SPPI, or if

the financial asset is not held in a business model that is either (i) a business model to collect the contractual cash flows or (ii) a business

model that is achieved by both collecting contractual cash flows and selling. Subsequent changes in fair value for these instruments are

recognised in the income statement in net investment income, except if reporting it in trading income reduces an accounting

mismatch.

Wherever possible, fair value is determined by reference to a quoted market price for that instrument. For many of the Group’s financial

assets and liabilities, especially derivatives, quoted prices are not available and valuation models are used to estimate fair value. The

models calculate the expected cash flows under the terms of each specific contract and then discount these values back to a present

value. These models use as their basis independently sourced market inputs including, for example, interest rate yield curves, equities

and commodities prices, option volatilities and currency rates.

For financial liabilities measured at fair value, the carrying amount reflects the effect on fair value of changes in own credit spreads

derived from observable market data such as in primary issuance and redemption activity for structured notes.

On initial recognition, it is presumed that the transaction price is the fair value unless there is observable information available in an

active market to the contrary.

For valuations that have made use of unobservable inputs, the difference between the model valuation and the initial transaction price

(Day one profit) is recognised in profit or loss either: on a straight-line basis over the term of the transaction; or over the period until all

inputs will become observable where appropriate; or released in full when previously unobservable inputs become observable.

Various factors influence the availability of observable inputs and these may vary from product to product and change over time.

Factors include the depth of activity in the relevant market, the type of product, whether the product is new and not widely traded in the

marketplace, the maturity of market modelling and the nature of the transaction (bespoke or generic). To the extent that valuation is

based on models or inputs that are not observable in the market, the determination of fair value can be more subjective, dependent on

the significance of the unobservable input to the overall valuation. Unobservable inputs are determined based on the best information

available, for example by reference to similar assets, similar maturities or other analytical techniques.

The sensitivity of valuations used in the financial statements to possible changes in significant unobservable inputs is shown on page

456.

Critical accounting estimates and judgements

The valuation of financial instruments often involves a significant degree of judgement and complexity, in particular where valuation

models make use of unobservable inputs (‘Level 3’ assets and liabilities). This note provides information on these instruments, including

the related unrealised gains and losses recognised in the period, a description of significant valuation techniques and unobservable

inputs, and a sensitivity analysis.

Climate-related risks are assumed to be included in the fair values of assets and liabilities traded in active markets. Within less active

markets, for counterparties and instruments identified as being more susceptible to climate change risk, an impact assessment was

performed through increasing their probability of default. The change in valuation of the assets and liabilities from this assessment was

sufficiently immaterial to necessitate any amendment to the reported year end valuations.

Valuation

Assets and liabilities according to a hierarchy that reflects the observability of significant market inputs. The three levels of the fair value

hierarchy are defined below with judgement applied in determining the boundary between Level 2 and 3 classification.

Quoted market prices – Level 1

Assets and liabilities are classified as Level 1 if their value is observable in an active market. Such instruments are valued by reference to

unadjusted quoted prices for identical assets or liabilities in active markets where the quoted price is readily available, and the price

represents actual and regularly occurring market transactions. An active market is one in which transactions occur with sufficient

volume and frequency to provide pricing information on an ongoing basis.

Valuation technique using observable inputs – Level 2

Assets and liabilities classified as Level 2 have been valued using models whose inputs are observable either directly or indirectly.

Valuations based on observable inputs include assets and liabilities such as swaps and forwards which are valued using market standard

pricing techniques, and options that are commonly traded in markets where all the inputs to the market standard pricing models are

observable. For certain instruments that derive a fair value using unobservable inputs that are not considered significant, then the asset

or liability may be classified as Level 2.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

Valuation technique using significant unobservable inputs – Level 3

Assets and liabilities are classified as Level 3 if their valuation incorporates significant inputs that are not based on observable market

data (unobservable inputs). A valuation input is considered observable if it can be directly observed from transactions in an active

market, or if there is compelling external evidence demonstrating an executable exit price. Unobservable input levels are generally

determined via reference to observable inputs, historical observations or using other analytical techniques.

The following table shows the Group’s assets and liabilities that are held at fair value disaggregated by valuation technique (fair value

hierarchy) and balance sheet classification:

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Assets and liabilities held at fair value | | | | |  | | | |
|  | 2023 | | | | 2022 | | | |
|  | Valuation technique using | | | | Valuation technique using | | | |
|  | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total |
| As at 31 December | £m | £m | £m | £m | £m | £m | £m | £m |
| Trading portfolio assets | 94,658 | 73,438 | 6,509 | 174,605 | 62,478 | 64,855 | 6,480 | 133,813 |
| Financial assets at fair value through the income  statement | 5,831 | 192,571 | 8,249 | 206,651 | 5,720 | 198,723 | 9,125 | 213,568 |
| Derivative financial assets | 107 | 253,189 | 3,540 | 256,836 | 10,054 | 287,152 | 5,174 | 302,380 |
| Financial assets at fair value through other  comprehensive income | 30,247 | 40,511 | 1,078 | 71,836 | 20,704 | 44,347 | 11 | 65,062 |
| Investment property | — | — | 2 | 2 | — | — | 5 | 5 |
| Total assets | 130,843 | 559,709 | 19,378 | 709,930 | 98,956 | 595,077 | 20,795 | 714,828 |
|  |  |  |  |  |  |  |  |  |
| Trading portfolio liabilities | (29,274) | (29,027) | (368) | (58,669) | (44,128) | (28,740) | (56) | (72,924) |
| Financial liabilities designated at fair value | (117) | (296,200) | (1,222) | (297,539) | (133) | (270,454) | (1,050) | (271,637) |
| Derivative financial liabilities | (81) | (245,310) | (4,653) | (250,044) | (10,823) | (272,434) | (6,363) | (289,620) |
| Total liabilities | (29,472) | (570,537) | (6,243) | (606,252) | (55,084) | (571,628) | (7,469) | (634,181) |

The following table shows the Group’s Level 3 assets and liabilities that are held at fair value disaggregated by product type:

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Level 3 assets and liabilities held at fair value by product type | | | |  |
|  | 2023 | | 2022 | |
|  | Assets | Liabilities | Assets | Liabilities |
|  | £m | £m | £m | £m |
| Interest rate derivatives | 2,211 | (1,701) | 2,362 | (2,858) |
| Foreign exchange derivatives | 111 | (91) | 1,513 | (1,474) |
| Credit derivatives | 241 | (820) | 290 | (603) |
| Equity derivatives | 977 | (2,041) | 1,009 | (1,428) |
| Corporate debt | 1,867 | (352) | 1,677 | (49) |
| Reverse repurchase and repurchase agreements | 209 | (517) | 37 | (434) |
| Loans | 10,614 | — | 11,233 | — |
| Private equity investments | 1,375 | (10) | 1,291 | (8) |
| Other1 | 1,773 | (711) | 1,383 | (615) |
| Total | 19,378 | (6,243) | 20,795 | (7,469) |

Note

1 Other includes funds and fund-linked products, issued debt, Government and Government sponsored debt, asset backed securities, equity cash products and investment property.

Valuation techniques and sensitivity analysis

Sensitivity analysis is performed on products with significant unobservable inputs (Level 3) to generate a range of reasonably possible

alternative valuations. The sensitivity methodologies applied take account of the nature of the valuation techniques used, as well as the

availability and reliability of observable proxy and historical data and the impact of using alternative models.

Sensitivities are dynamically calculated on a monthly basis. The calculation is based on range or spread data of a reliable reference

source or a scenario based on relevant market analysis alongside the impact of using alternative models. Sensitivities are calculated

without reflecting the impact of any diversification in the portfolio.

The valuation techniques used, observability and sensitivity analysis for material products within Level 3, are described below.

Interest rate derivatives

Description: Derivatives linked to interest rates or inflation indices. The category includes futures, interest rate and inflation swaps,

swaptions, caps, floors, inflation options, balance guaranteed swaps and other exotic interest rate derivatives.

Valuation: Interest rate and inflation derivatives are generally valued using curves of forward rates constructed from market data to

project and discount the expected future cash flows of trades. Instruments with optionality are valued using volatilities implied from

market inputs, and use industry standard or bespoke models depending on the product type.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 450 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

Observability: In general, inputs are considered observable up to liquid maturities which are determined separately for each input and

underlying. Unobservable inputs are generally set by referencing liquid market instruments and applying extrapolation techniques or

inferred via another reasonable method.

Foreign exchange derivatives

Description: Derivatives linked to the foreign exchange (FX) market. The category includes FX forward contracts, FX swaps and FX

options. The majority are traded as over the counter (OTC) derivatives.

Valuation: FX derivatives are valued using industry standard and bespoke models depending on the product type. Valuation inputs

include FX rates, interest rates, FX volatilities, interest rate volatilities, FX interest rate correlations and others as appropriate.

Observability: FX correlations, forwards and volatilities are generally observable up to liquid maturities which are determined separately

for each input and underlying. Unobservable inputs are set by referencing liquid market instruments and applying extrapolation

techniques, or inferred via another reasonable method.

Credit derivatives

Description: Derivatives linked to the credit spread of a referenced entity, index or basket of referenced entities or a pool of referenced

assets (e.g. a securitised product). The category includes single name and index credit default swaps (CDS) and total return swaps

(TRS).

Valuation: CDS are valued on industry standard models using curves of credit spreads as the principal input. Credit spreads are observed

directly from broker data, third party vendors or priced to proxies.

Observability: CDS contracts referencing entities that are actively traded are generally considered observable. Other valuation inputs

are considered observable if products with significant sensitivity to the inputs are actively traded in a liquid market. Unobservable

valuation inputs are generally determined with reference to recent transactions or inferred from observable trades of the same issuer

or similar entities.

Equity derivatives

Description: Exchange traded or OTC derivatives linked to equity indices and single names. The category includes vanilla and exotic

equity products.

Valuation: Equity derivatives are valued using industry standard models. Valuation inputs include stock prices, dividends, volatilities,

interest rates, equity repurchase curves and, for multi-asset products, correlations.

Observability: In general, valuation inputs are observable up to liquid maturities which are determined separately for each input and

underlying. Unobservable inputs are set by referencing liquid market instruments and applying extrapolation techniques, or inferred via

another reasonable method.

Corporate debt

Description: Primarily corporate bonds.

Valuation: Corporate bonds are valued using observable market prices sourced from broker quotes, inter-dealer prices or other reliable

pricing sources.

Observability: Prices for actively traded bonds are considered observable. Unobservable bonds prices are generally determined by

reference to bond yields or CDS spreads for actively traded instruments issued by or referencing the same (or a similar) issuer.

Reverse repurchase and repurchase agreements

Description: Includes securities purchased under resale agreements, securities sold under repurchase agreements, and other similar

secured lending agreements. The agreements are primarily short-term in nature.

Valuation: Repurchase and reverse repurchase agreements are generally valued by discounting the expected future cash flows using

industry standard models that incorporate market interest rates and repurchase rates, based on the specific details of the transaction.

Observability: Inputs are deemed observable up to liquid maturities or for consensus pricing with low pricing-range and are determined

based on the specific features of the transaction. Unobservable inputs are generally set by referencing liquid market instruments and

applying extrapolation techniques, or inferred via another reasonable method.

Loans

Description: A drawn lending facility issued to corporate clients and customers.

Valuation:  Loans are valued either using a price-based approach, or  through  models that discount expected future cash flows based

on interest rates and loan spreads.

Observability: Within this loan population, the price or loan spread may be  generally unobservable.

Private equity investments

Description: Includes investments in equity holdings in operating companies not quoted on a public exchange.

Valuation: Private equity investments are valued in accordance with the ‘International Private Equity and Venture Capital Valuation

Guidelines’ which require the use of a number of individual pricing benchmarks such as the prices of recent transactions in the same or

similar entities, discounted cash flow analysis and comparison with the earnings or revenue multiples of listed companies. While the

valuation of unquoted equity instruments is subjective by nature, the relevant methodologies are commonly applied by other market

participants and have been consistently applied over time.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 451 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

Observability: Inputs are considered observable if there is active trading in a liquid market of products with significant sensitivity to the

inputs. Unobservable inputs include earnings or revenue estimates, multiples of comparative companies, marketability discounts and

discount rates.

Other

Description: Other includes funds and fund-linked products, issued debt, government sponsored debt, asset backed securities, equity

cash products  and  investment property.

Assets and liabilities reclassified between Level 1 and Level 2

During the period, there were no material transfers between Level 1 and Level 2 (2022: there were no material transfers between Level

1 and Level 2).

Level 3 movement analysis

The following table summarises the movements in the Level 3 balances during the period. Transfers have been reflected as if they had

taken place at the beginning of the year.

Asset and liability transfers between Level 2 and Level 3 are primarily due to i) an increase or decrease in observable market activity

related to an input or ii) a change in the significance of the unobservable input, with assets and liabilities classified as Level 3 if an

unobservable input is deemed significant.

|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Analysis of movements in Level 3 assets and liabilities | | | | | |  |  |  |  |  |  |
|  | As at 1  January  2023 |  |  |  |  | Total gains and (losses)  in the period  recognised in the  income statement | | Total gains  or (losses)  recognised  in OCI | Transfers | | As at 31  December  2023 |
|  | Purchases | Sales | Issues | Settlements | Trading  income 2 | Other  income | In | Out |
|  | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m |
| Corporate debt | 597 | 352 | (146) | — | (220) | 76 | — | — | 56 | (34) | 681 |
| Loans | 4,837 | 1,425 | (1,734) | — | (382) | (34) | — | — | 384 | (27) | 4,469 |
| Other | 1,046 | 1,617 | (1,143) | — | — | (31) | — | — | 619 | (749) | 1,359 |
| Trading portfolio assets | 6,480 | 3,394 | (3,023) | — | (602) | 11 | — | — | 1,059 | (810) | 6,509 |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Corporate debt | 1,080 | 40 | (145) | — | — | 10 | (8) | — | — | (89) | 888 |
| Loans | 6,396 | 3,630 | (3,263) | — | (1,361) | 176 | (14) | — | 213 | (165) | 5,612 |
| Private equity investments | 1,284 | 97 | (26) | — | (6) | (64) | 86 | — | — | — | 1,371 |
| Reverse repurchase and  repurchase agreements | 37 | 166 | — | — | — | 6 | — | — | — | — | 209 |
| Other | 328 | 33 | (1) | — | (62) | (19) | (3) | — | 26 | (133) | 169 |
| Financial assets at fair value  through the income statement | 9,125 | 3,966 | (3,435) | — | (1,429) | 109 | 61 | — | 239 | (387) | 8,249 |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Corporate debt | — | 193 | — | — | — | — | — | — | 105 | — | 298 |
| Loans | — | 533 | — | — | — | — | — | — | — | — | 533 |
| Private equity investments | 7 | — | — | — | — | — | — | (3) | — | — | 4 |
| Other | 4 | 200 | — | — | (3) | — | — | — | 42 | — | 243 |
| Assets at fair value through  other comprehensive income | 11 | 926 | — | — | (3) | — | — | (3) | 147 | — | 1,078 |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Investment properties | 5 | — | (4) |  | — | — | 1 | — | — | — | 2 |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Trading portfolio liabilities | (56) | (367) | 45 | — | — | — | — | — | — | 10 | (368) |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Financial liabilities designated at  fair value | (1,050) | (40) | — | (403) | — | (38) | (3) | — | (147) | 459 | (1,222) |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Interest rate derivatives | (496) | 130 | (31) | — | 58 | 87 | — | — | 326 | 436 | 510 |
| Foreign exchange derivatives | 39 | — | — | — | 37 | (15) | — | — | 11 | (52) | 20 |
| Credit derivatives | (313) | (351) | 56 | — | (15) | (2) | — | — | 51 | (5) | (579) |
| Equity derivatives | (419) | (419) | (1) | — | 3 | (162) | — | — | — | (66) | (1,064) |
| Net derivative financial  instruments1 | (1,189) | (640) | 24 | — | 83 | (92) | — | — | 388 | 313 | (1,113) |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Total | 13,326 | 7,239 | (6,393) | (403) | (1,951) | (10) | 59 | (3) | 1,686 | (415) | 13,135 |

|  |  |  |  |  |  |  |  |  |  |  |
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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Analysis of movements in Level 3 assets and liabilities | | | | | |  |  |  |  |  |  |
|  | As at 1  January  2022 |  |  |  |  | Total gains and (losses)  in the period  recognised in the  income statement | | Total gains  or (losses)  recognised  in OCI | Transfers | | As at 31  December  2022 |
|  | Purchases | Sales | Issues | Settlements | Trading  income 2 | Other  income | In | Out |
|  | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m |
| Corporate debt | 389 | 394 | (182) | — | (18) | (39) | — | — | 87 | (34) | 597 |
| Loans | 758 | 7,009 | (2,635) | — | (19) | (264) | — | — | 10 | (22) | 4,837 |
| Other | 1,134 | 665 | (412) | — | (298) | (43) | — | — | 275 | (275) | 1,046 |
| Trading portfolio assets | 2,281 | 8,068 | (3,229) | — | (335) | (346) | — | — | 372 | (331) | 6,480 |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Corporate debt | 816 | 405 | — | — | (189) | 48 | — | — | — | — | 1,080 |
| Loans | 7,608 | 8,689 | (7,559) | — | (1,485) | (804) | — | — | 49 | (102) | 6,396 |
| Private equity investments | 1,095 | 192 | (64) | — | (24) | 95 | (66) | — | 56 | — | 1,284 |
| Reverse repurchase and  repurchase agreements | 13 | — | — | — | — | 24 | — | — | — | — | 37 |
| Other | 180 | 127 | — | — | (2) | 3 | 3 | — | 17 | — | 328 |
| Financial assets at fair value  through the income statement | 9,712 | 9,413 | (7,623) | — | (1,700) | (634) | (63) | — | 122 | (102) | 9,125 |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Private equity investments | — | — | — | — | — | — | — | 1 | 6 | — | 7 |
| Other | 38 | — | — | — | (32) | — | — | (2) | — | — | 4 |
| Assets at fair value through  other comprehensive income | 38 | — | — | — | (32) | — | — | (1) | 6 | — | 11 |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Investment properties | 7 | — | (1) | — | — | — | (1) | — | — | — | 5 |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Trading portfolio liabilities | (27) | (23) | 8 | — | — | 9 | — | — | (27) | 4 | (56) |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Financial liabilities designated at  fair value | (410) | (286) | — | (98) | 82 | 70 | — | — | (448) | 40 | (1,050) |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Interest rate derivatives | (260) | (216) | — | — | 54 | (467) | — | — | 431 | (38) | (496) |
| Foreign exchange derivatives | 2 | — | — | — | (6) | 27 | — | — | — | 16 | 39 |
| Credit derivatives | (386) | (4) | (2) | — | 57 | 23 | — | — | 11 | (12) | (313) |
| Equity derivatives | (1,405) | (213) | — | — | 333 | 306 | — | — | (11) | 571 | (419) |
| Net derivative financial  instruments 1 | (2,049) | (433) | (2) | — | 438 | (111) | — | — | 431 | 537 | (1,189) |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Total | 9,552 | 16,739 | (10,847) | (98) | (1,547) | (1,012) | (64) | (1) | 456 | 148 | 13,326 |

Notes

1 The derivative financial instruments are represented on a net basis. On a gross basis, derivative financial assets are £3,540m (2022: £5,174m) and derivative financial liabilities are

£4,653m (2022: £6,363m).

2  Trading income represents gains and (losses) on level 3 financial instruments which in the majority are offset by losses and gains on financial instruments disclosed in level 2.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

Unrealised gains and losses on Level 3 financial assets and liabilities

The following table discloses the unrealised gains and losses recognised in the year arising on Level 3 financial assets and liabilities held

at year end.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Unrealised gains and (losses) recognised during the period on Level 3 assets and liabilities held at year end | | | | | | | | |
|  | 2023 | | | | 2022 | | | |
|  | Income statement | | Other  compre-  hensive  income | Total | Income statement | | Other  compre-  hensive  income | Total |
|  | Trading  income 1 | Other  income | Trading  income 1 | Other  income |
| As at 31 December | £m | £m | £m | £m | £m | £m | £m | £m |
| Trading portfolio assets | 10 | — | — | 10 | (290) | — | — | (290) |
| Financial assets at fair value through the income statement | 113 | 72 | — | 185 | (551) | (66) | — | (617) |
| Fair value through other comprehensive income | — | — | (3) | (3) | — | — | 1 | 1 |
| Investment property | — | 1 | — | 1 | — | (1) | — | (1) |
| Trading portfolio liabilities | — | — | — | — | 8 | — | — | 8 |
| Financial liabilities designated at fair value | (38) | (3) | — | (41) | 55 | — | — | 55 |
| Net derivative financial instruments | (107) | — | — | (107) | (80) | — | — | (80) |
| Total | (22) | 70 | (3) | 45 | (858) | (67) | 1 | (924) |

Note

1 Trading income represents gains and (losses) on level 3 financial instruments which in the majority are offset by losses and gains on financial instruments disclosed in level 2.

Significant unobservable inputs

The following table discloses the valuation techniques and significant unobservable inputs for material products recognised at fair value

and classified as Level 3 along with the range of values used for those significant unobservable inputs:

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| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | Valuation technique(s)1 | Significant unobservable inputs | 2023 Range | | 2022 Range | |  |
|  | Min | Max | Min | Max | Units2 |
| Derivative financial  instruments 3 |  |  |  |  |  |  |  |
| Interest rate derivatives | Discounted cash flows | Inflation forwards | 4 | 7 | 3 | 5 | % |
|  |  | Credit spread | 15 | 1,672 | 17 | 2,159 | bps |
|  |  | Yield | 1 | 7 | (3) | 56 | % |
|  |  | Growth curve | (1) | 2 | — | — | % |
|  | Correlation model | Inflation forwards | — | — | (20) | (13) | % |
|  | Option model | Inflation volatility | 66 | 257 | 49 | 315 | bps vol |
|  |  | Interest rate volatility | 26 | 515 | 36 | 430 | bps vol |
|  |  | FX - IR correlation | (20) | 78 | (20) | 78 | % |
|  |  | IR - IR correlation | (20) | 98 | 12 | 99 | % |
| Credit derivatives | Discounted cash flows | Credit spread | 1 | 765 | 3 | 2,943 | bps |
|  | Comparable pricing | Price | 46 | 99 | 79 | 92 | points |
| Equity derivatives | Option model | Equity volatility | 5 | 138 | 3 | 140 | % |
|  |  | Equity - equity  correlation | 40 | 100 | 40 | 100 | % |
|  | Discounted cash flow | Discount margin | (238) | 110 | (205) | 634 | bps |
| Non-derivative financial  instruments |  |  |  |  |  |  |  |
| Loans | Discounted cash flows | Loan spread | 40 | 802 | 50 | 801 | bps |
|  |  | Credit spread | 186 | 870 | 200 | 426 | bps |
|  |  | Yield | 7 | 18 | 5 | 34 | % |
|  | Comparable pricing | Price | 0 | 287 | 0 | 101 | points |
| Private equity investments | EBITDA multiple | EBITDA multiple | 15 | 17 | 11 | 15 | Multiple |
|  | Earnings multiple | Earnings multiple | 3 | 25 | 4 | 23 | Multiple |
|  | Discounted cash flow | Credit spread | 380 | 630 | 496 | 559 | bps |
|  |  | Discount margin | 8 | 10 | 8 | 10 | % |
| Corporate debt | Comparable pricing | Price | — | 352 | 0 | 232 | points |
|  | Discounted cash flows | Loan spread | — | — | 229 | 834 | bps |
| Reverse repurchase and  repurchase agreements | Discounted cash flows | Repo spread | 385 | 468 | 321 | 502 | bps |

Notes

1 A range has not been provided for Net Asset Value as there would be a wide range reflecting the diverse nature of the positions.

2 The units used to disclose ranges for significant unobservable inputs are percentages, points and basis points. Points are a percentage of par; for example, 100 points equals 100% of

par. A basis point equals 1/100th of 1%; for example, 150 basis points equals 1.5%.

3 Certain derivative instruments are classified as Level 3 due to a significant unobservable credit spread input into the calculation of the Credit Valuation Adjustment for the instruments.

The range of significant unobservable credit spreads is between 29-1672bps (2022: 17-2,159bps).

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

The following section describes the significant unobservable inputs identified in the table above, and the sensitivity of fair value

measurement of the instruments categorised as Level 3 assets or liabilities to increases in significant unobservable inputs. Where

sensitivities are described, the inverse relationship will also generally apply.

Where reliable interrelationships can be identified between significant unobservable inputs used in fair value measurement, a

description of those interrelationships is included below.

Forwards

A price or rate that is applicable to a financial transaction that will take place in the future.

In general, a significant increase in a forward in isolation will result in a fair value increase for the contracted receiver of the underlying

(currency, bond, commodity, etc.), but the sensitivity is dependent on the specific terms of the instrument.

Credit spread

Credit spreads typically represent the difference in yield between an instrument and a benchmark security or reference rate. Credit

spreads reflect the additional yield that a market participant demands for taking on exposure to the credit risk of an instrument and

form part of the yield used in a discounted cash flow calculation.

In general, a significant increase in credit spread in isolation will result in a movement in a fair value decrease for a cash asset.

For a derivative instrument, a significant increase in credit spread in isolation can result in a fair value increase or decrease depending on

the specific terms of the instrument.

Volatility

Volatility is a measure of the variability or uncertainty in return for a given derivative underlying. It is an estimate of how much a particular

underlying instrument input or index will change in value over time. In general, volatilities are implied from observed option prices. For

unobservable options the implied volatility may reflect additional assumptions about the nature of the underlying risk, and the strike/

maturity profile of a specific contract.

In general a significant increase in volatility in isolation will result in a fair value increase for the holder of a simple option, but the

sensitivity is dependent on the specific terms of the instrument.

There may be interrelationships between unobservable volatilities and other unobservable inputs (e.g. when equity prices fall, implied

equity volatilities generally rise) but these are generally specific to individual markets and may vary over time.

Correlation

Correlation is a measure of the relationship between the movements of two variables. Correlation can be a significant input into

valuation of derivative contracts with more than one underlying instrument. Credit correlation generally refers to the correlation

between default processes for the separate names that make up the reference pool of a CDO structure.

A significant increase in correlation in isolation can result in a fair value increase or decrease depending on the specific terms of the

instrument.

Comparable price

Comparable instrument prices are used in valuation by calculating an implied yield (or spread over a liquid benchmark) from the price of a

comparable observable instrument, then adjusting that yield (or spread) to account for relevant differences such as maturity or credit

quality. Alternatively, a price-to-price basis can be assumed between the comparable and unobservable instruments in order to

establish a value.

Loans includes a portfolio of loans extended to clients within the Group’s leveraged finance business. Leveraged finance loans are

originated where Barclays provide financing commitments to clients to facilitate strategic transactions such as leverage buyouts and

acquisitions. The sensitivity of the portfolio to unobservable inputs is judgmental reflecting their illiquid nature and the significance of

unobservable price inputs to the valuation.

In general, a significant increase in comparable price in isolation will result in an increase in the price of the unobservable instrument. For

derivatives, a change in the comparable price in isolation can result in a fair value increase or decrease depending on the specific terms

of the instrument.

Loan spread

Loan spreads typically represent the difference in yield between an instrument and a benchmark security or reference rate. Loan

spreads typically reflect credit quality, the level of comparable assets such as gilts and other factors, and form part of the yield used in a

discounted cash flow calculation.

Loans containing unobservable input loan spreads into their valuation primarily consist of long-dated fixed rate loans extended to

counterparties in the UK Education, Social Housing and Local Authority sectors (ESHLA). The loans are categorised as Level 3 in the fair

value hierarchy due to their illiquid nature and the significance of unobservable loan spreads to the valuation. Valuation uncertainty

arises from the long-dated nature of the portfolio, the lack of secondary market in the loans and the lack of observable loan spreads.

The majority of ESHLA loans are to borrowers in heavily regulated sectors that are considered extremely low credit risk, and have a

history of near zero defaults since inception. While the overall loan spread range is from 40bps to 307bps (2022: 50bps to 589bps), the

vast majority of spreads are concentrated towards the bottom end of this range, with 98% of the loan notional being valued with

spreads less than 200bps for the current period.

In general, a significant increase in loan spreads in isolation will result in a fair value decrease for a loan.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

EBITDA multiple

EBITDA multiple is the ratio of the valuation of the investment to the earnings before interest, taxes, depreciation and amortisation.

In general, a significant increase in the multiple will result in a fair value increase for an investment.

Earnings multiple

Earnings or Revenue multiple is the ratio of the valuation of the investment to the earnings or revenue. In general, a significant increase

in the multiple will result in a fair value increase for an investment.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Sensitivity analysis of valuations using unobservable inputs | | | | | | | | |
|  | 2023 | | | | 2022 | | | |
|  | Favourable changes | | Unfavourable changes | | Favourable changes | | Unfavourable changes | |
|  | Income  statement | Equity | Income  statement | Equity | Income  statement | Equity | Income  statement | Equity |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| Interest rate derivatives | 78 | — | (158) | — | 119 | — | (155) | — |
| Foreign exchange derivatives | 4 | — | (9) | — | 16 | — | (22) | — |
| Credit derivatives | 27 | — | (32) | — | 79 | — | (71) | — |
| Equity derivatives | 142 | — | (226) | — | 161 | — | (168) | — |
| Corporate debt | 34 | — | (22) | — | 45 | — | (27) | — |
| Loans | 612 | 2 | (801) | (2) | 338 | — | (551) | — |
| Private equity investments | 263 | 1 | (263) | (1) | 268 | 1 | (281) | (1) |
| Other1 | 126 | 1 | (118) | (1) | 49 | — | (52) | — |
| Total | 1,286 | 4 | (1,629) | (4) | 1,075 | 1 | (1,327) | (1) |

Note

1 Other includes, Equity Cash Products,  Fund and Fund Linked, Government and Government Sponsored Debt, Asset backed securities.

The effect of stressing unobservable inputs to a range of reasonably possible alternatives, alongside considering the impact of using

alternative models, would be to increase fair values by up to £1,290m (2022: £1,076m) or to decrease fair values by up to £1,633m

(2022: £1,328m) with substantially all the potential effect impacting profit and loss. Unfavourable changes shown in the table above are

partly provided for through the capital and prudential valuation adjustment framework

Fair value adjustments

Key balance sheet valuation adjustments are quantified below:

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| Exit price adjustments derived from market bid-offer spreads | (569) | (577) |
| Uncollateralised derivative funding | (4) | (11) |
| Derivative credit valuation adjustments | (209) | (319) |
| Derivative debit valuation adjustments | 144 | 208 |

Exit price adjustments derived from market bid-offer spreads

The Group uses mid-market pricing where it is a market maker and has the ability to transact at, or better than, mid price (which is the

case for certain equity, bond and vanilla derivative markets). For other financial assets and liabilities, bid-offer adjustments are recorded

to reflect the exit level for the expected close out strategy. The methodology for determining the bid-offer adjustment for a derivative

portfolio involves calculating the net risk exposure by offsetting long and short positions by strike and term in accordance with the risk

management and hedging strategy.

Bid-offer levels are generally derived from market quotes such as broker data. Less liquid instruments may not have a directly

observable bid-offer level. In such instances, an exit price adjustment may be derived from an observable bid-offer level for a

comparable liquid instrument, or determined by calibrating to derivative prices, or by scenario or historical analysis.

Exit price adjustments derived from market bid-offer spreads have decreased by £8m to £(569)m.

Discounting approaches for derivative instruments

Collateralised

In line with market practice, the methodology for discounting collateralised derivatives takes into account the nature and currency of

the collateral that can be posted within the relevant credit support annex (CSA). The CSA aware discounting approach recognises the

‘cheapest to deliver’ option that reflects the ability of the party posting collateral to change the currency of the collateral.

Uncollateralised

A fair value adjustment of £(4)m is applied to account for the impact of incorporating the cost of funding into the valuation of

uncollateralised and partially collateralised derivative portfolios and collateralised derivatives where the terms of the agreement do not

allow the rehypothecation of collateral received. The  derivative funding adjustment  has decreased by £7m to £(4)m .

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

Derivative credit and debit valuation adjustments

Derivative credit valuation adjustments and Derivative debit valuation adjustments are incorporated into derivative valuations to reflect

the impact on fair value of counterparty credit risk and Barclays’ own credit quality respectively. These adjustments are calculated for

uncollateralised and partially collateralised derivatives across all asset classes. Derivative credit valuation adjustments and Derivative

debit valuation adjustments are calculated using estimates of exposure at default, probability of default and recovery rates, at a

counterparty level. Counterparties include (but are not limited to) corporates, sovereigns and sovereign agencies and supranationals.

Exposure at default is generally estimated through the simulation of underlying risk factors through approximating with a more vanilla

structure, or by using current or scenario-based mark to market as an estimate of future exposure.

Probability of default and recovery rate information is generally sourced from the CDS markets. Where this information is not available,

or considered unreliable, alternative approaches are taken based on mapping internal counterparty ratings onto historical or market-

based default and recovery information.

Derivative credit valuation adjustments decreased by £110m to £(209)m as a result of tightening input counterparty credit spreads.

Derivative debit valuation adjustments decreased by £64m to £144m as a result of tightening input Barclays Bank PLC credit spreads .

Correlation between counterparty credit and underlying derivative risk factors, termed ‘wrong-way,’ or ‘right-way’ risk, is not

systematically incorporated into the derivative credit valuation adjustments calculation but is adjusted where the underlying exposure is

directly related to the counterparty.

Barclays continues to monitor market practices and activity to ensure the approach to uncollateralised derivative valuation remains

appropriate.

Portfolio exemptions

The Group uses the portfolio exemption in IFRS 13 Fair Value Measurement to measure the fair value of groups of financial assets and

liabilities. Instruments are measured using the price that would be received to sell a net long position (i.e. an asset) for a particular risk

exposure or to transfer a net short position (i.e. a liability) for a particular risk exposure in an orderly transaction between market

participants at the balance sheet date under current market conditions. Accordingly, the Group measures the fair value of the group of

financial assets and liabilities consistently with how market participants would price the net risk exposure at the measurement date.

Unrecognised gains as a result of the use of valuation models using unobservable inputs

The amount that has yet to be recognised in income that relates to the difference between the transaction price (the fair value at initial

recognition) and the amount that would have arisen had valuation models using unobservable inputs been used on initial recognition,

less amounts subsequently recognised, is £205m (2022: £126m) for financial instruments measured at fair value and £192m (2022:

£216m) for financial instruments carried at amortised cost. There are additions and FX loss of £136m (2022: £59m additions and FX

gains), and amortisation and releases of £57m (2022: £66m) for financial instruments measured at fair value and additions of £0m

(2022: £0m) and amortisation and releases of £24m (2022: £14m) for financial instruments measured at amortised cost.

Third-party credit enhancements

Structured and brokered certificates of deposit issued by Barclays are insured up to $250,000 per depositor by the Federal Deposit

Insurance Corporation (FDIC) in the US. The FDIC is funded by premiums that Barclays and other banks pay for deposit insurance

coverage. The carrying value of these issued certificates of deposit that are designated under the IFRS 9 fair value option includes this

third party credit enhancement. The on-balance sheet value of these brokered certificates of deposit amounted to £5,162m (2022:

£5,197m).

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

Comparison of carrying amounts and fair values for assets and liabilities not held at fair value

The following table summarises the fair value of financial assets and liabilities measured at amortised cost on the Group’s balance

sheet:

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
|  | 2023 | | | | | 2022 | | | | |
|  | Carrying  amount | Fair value | Level 1 | Level 2 | Level 3 | Carrying  amount | Fair value | Level 1 | Level 2 | Level 3 |
| As at 31 December | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m |
| Financial assets |  |  |  |  |  |  |  |  |  |  |
| Debt securities at amortised cost | 56,749 | 55,437 | 13,976 | 39,014 | 2,447 | 45,487 | 44,512 | 9,952 | 33,285 | 1,275 |
| Loans and advances at amortised cost | 342,747 | 334,706 | 5,854 | 80,533 | 248,319 | 353,292 | 347,149 | 5,165 | 79,868 | 262,116 |
| Reverse repurchase agreements and  other similar secured lending | 2,594 | 2,594 | — | 2,594 | — | 776 | 776 | — | 776 | — |
| Assets included in disposal groups  classified as held for sale | 3,855 | 3,855 | — | 3,855 | — | — | — | — | — | — |
|  |  |  |  |  |  |  |  |  |  |  |
| Financial liabilities |  |  |  |  |  |  |  |  |  |  |
| Deposits at amortised cost | (538,789) | (538,502) | (382,345) | (150,757) | (5,400) | (545,782) | (545,738) | (426,016) | (116,157) | (3,565) |
| Repurchase agreements and other  similar secured borrowing | (41,601) | (41,601) | — | (41,601) | — | (27,052) | (27,054) | — | (27,054) | — |
| Debt securities in issue | (96,825) | (98,123) | — | (95,999) | (2,124) | (112,881) | (113,276) | — | (110,151) | (3,125) |
| Subordinated liabilities | (10,494) | (10,803) | — | (10,608) | (195) | (11,423) | (11,474) | — | (11,254) | (220) |
| Liabilities included in disposal groups  classified as held for sale | (3,078) | (3,078) | — | (3,078) | — | — | — | — | — | — |

The fair value is an estimate of the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction

between market participants at the measurement date. As a wide range of valuation techniques are available, it may not be appropriate

to directly compare this fair value information to independent market sources or other financial institutions. Different valuation

methodologies and assumptions can have a significant impact on fair values which are based on unobservable inputs.

Financial assets

Loans and advances at amortised cost

The fair value of loans and advances, for the purpose of this disclosure, is derived from discounting expected cash flows in a way that

reflects the current market price for lending to issuers of similar credit quality. Where market data or credit information on the

underlying borrowers is unavailable, a number of proxy/extrapolation techniques are employed to determine the appropriate discount

rates. For 2023, the fair value is lower than carrying value mainly on fixed rate products driven by rising interest rates. The majority will be

part of a wider portfolio which includes fair valued instruments that are not presented in this table.

Reverse repurchase agreements and other similar secured borrowing

The fair value of reverse repurchase agreements approximates carrying amount as these balances are generally short dated and fully

collateralised.

Financial liabilities

Deposits at amortised cost

In many cases, the fair value disclosed approximates carrying value because the instruments are short term in nature or have interest

rates that reprice frequently, such as customer accounts and other deposits and short-term debt securities.

The fair value for deposits with longer-term maturities, mainly time deposits, are estimated using discounted cash flows applying either

market rates or current rates for deposits of similar remaining maturities. Consequently, the fair value discount is minimal.

Repurchase agreements and other similar secured borrowing

The fair value of repurchase agreements approximates carrying amounts as these balances are generally short dated.

Debt securities in issue

Fair values of other debt securities in issue are based on quoted prices where available, or where the instruments are short dated,

carrying amount approximates fair value.

Subordinated liabilities

Fair values for dated and undated convertible and non-convertible loan capital are based on quoted market rates for the issuer

concerned or issuers with similar terms and conditions.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

18 Offsetting financial assets and financial liabilities

The Group reports financial assets and financial liabilities on a net basis on the balance sheet only if there is a legally enforceable right to

set-off the recognised amounts and there is intention to settle on a net basis, or to realise the asset and settle the liability

simultaneously. The following table shows the impact of netting arrangements on:

▪ all financial assets and liabilities that are reported net on the balance sheet

▪ all derivative financial instruments and reverse repurchase and repurchase agreements and other similar secured lending and

borrowing agreements that are subject to enforceable master netting arrangements or similar agreements, but do not qualify for

balance sheet netting.

The ‘Net amounts’ presented  are not intended to represent the Group’s actual exposure to credit risk, as a variety of credit mitigation

strategies are employed in addition to netting and collateral arrangements.

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  | Amounts subject to enforceable netting arrangements | | | | | | Amounts not  subject to  enforceable  netting  arrangements 3 | Balance sheet  total 4 |
|  | Effects of offsetting on-balance sheet | | | Related amounts not offset | | |
|  | Gross amounts | Amounts  offset 1 | Net amounts  reported on  the balance  sheet | Financial  instruments | Financial  collateral 2 | Net amount |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| As at 31 December 2023 |  |  |  |  |  |  |  |  |
| Derivative financial assets | 307,429 | (55,781) | 251,648 | (198,809) | (41,247) | 11,592 | 5,188 | 256,836 |
| Reverse repurchase agreements and  other similar secured lending5 | 677,175 | (527,864) | 149,311 | — | (148,888) | 423 | 2,414 | 151,725 |
| Total assets | 984,604 | (583,645) | 400,959 | (198,809) | (190,135) | 12,015 | 7,602 | 408,561 |
| Derivative financial liabilities | (297,449) | 54,241 | (243,208) | 198,809 | 27,978 | (16,421) | (6,836) | (250,044) |
| Repurchase agreements and other  similar secured borrowing 5 | (731,200) | 527,864 | (203,336) | — | 203,336 | — | (23,980) | (227,316) |
| Total liabilities | (1,028,649) | 582,105 | (446,544) | 198,809 | 231,314 | (16,421) | (30,816) | (477,360) |
|  |  |  |  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |  |  |  |
| Derivative financial assets | 374,253 | (76,429) | 297,824 | (238,337) | (45,981) | 13,506 | 4,556 | 302,380 |
| Reverse repurchase agreements and  other similar secured lending5 | 558,977 | (396,323) | 162,654 | — | (162,024) | 630 | 2,803 | 165,457 |
| Total assets | 933,230 | (472,752) | 460,478 | (238,337) | (208,005) | 14,136 | 7,359 | 467,837 |
| Derivative financial liabilities | (360,630) | 76,530 | (284,100) | 238,337 | 26,639 | (19,124) | (5,520) | (289,620) |
| Repurchase agreements and other  similar secured borrowing 5 | (571,774) | 396,323 | (175,451) | — | 175,451 | — | (24,347) | (199,798) |
| Total liabilities | (932,404) | 472,853 | (459,551) | 238,337 | 202,090 | (19,124) | (29,867) | (489,418) |

Notes

1 Amounts offset for derivative financial assets additionally includes cash collateral netted of £7,527m (2022: £15,199m ). Amounts offset for derivative financial liabilities additionally

includes cash collateral netted of £9,067m (2022:  £15,098m). Settlements assets and liabilities have been offset amounting to £29,297m (2022: £24,250m).

2 Financial collateral of £41,247m (2022: £45,981m) was received in respect of derivative assets, including £31,211m (2022: £34,547m) of cash collateral and £10,036m (2022: £11,434m)

of non-cash collateral. Financial collateral of £27,978m (2022: £26,639m) was placed in respect of derivative liabilities, including  £24,260m (2022 : £25,222m) of cash collateral and

£3,718m (2022 : £1,417m) of non-cash collateral. The collateral amounts are limited to net balance sheet exposure so as to not include overcollateralisation.

3 This column includes contractual rights of set-off that are subject to uncertainty under the laws of the relevant jurisdiction.

4 The balance sheet total is the sum of ‘Net amounts reported on the balance sheet’ that are subject to enforceable netting arrangements and ‘Amounts not subject to enforceable

netting arrangements’.

5 Reverse repurchase agreements and other similar secured lending of £151,725m (2022:  £165,457m) is split by fair value £149,131m (2022: £164,681m) and amortised cost £2,594m

(2022: £776m). Repurchase agreements and other similar secured borrowing of £227,316m (2022: £199,798m) is split by fair value £185,715m ( 2022: £172,746m) and amortised cost

£41,601m (2022 : £27,052m).

Derivative assets and liabilities

The ‘Financial instruments’ column identifies financial assets and liabilities that are subject to set-off under netting agreements, such as

the ISDA Master Agreement or derivative exchange or clearing counterparty agreements, whereby all outstanding transactions with

the same counterparty can be offset and close-out netting applied across all outstanding transactions covered by the agreements if an

event of default or other predetermined events occur.

Financial collateral refers to cash and non-cash collateral obtained, typically daily or weekly, to cover the net exposure between

counterparties by enabling the collateral to be realised in an event of default or if other predetermined events occur.

Repurchase and reverse repurchase agreements and other similar secured lending and borrowing

The ‘Financial instruments’ column identifies financial assets and liabilities that are subject to set-off under netting agreements, such as

Global Master Repurchase Agreements and Global Master Securities Lending Agreements, whereby all outstanding transactions with

the same counterparty can be offset and close-out netting applied across all outstanding transactions covered by the agreements if an

event of default or other predetermined events occur.

Financial collateral typically comprises highly liquid securities which are legally transferred and can be liquidated in the event of

counterparty default.

These offsetting and collateral arrangements and other credit risk mitigation strategies used by the Group are further explained in the

Credit risk management section.

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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets and liabilities held at fair value | | | | | | | | | | |

#### Assets at amortised cost and other investments

The notes included in this section focus on the Group’s property, plant and equipment, leases and goodwill and intangible assets.

Details regarding the Group’s liquidity and capital position can be found in the Treasury and Capital risk section.

19 Property, plant and equipment

Accounting for property, plant and equipment

Property, plant and equipment is stated at cost, which includes direct and incremental acquisition costs less accumulated depreciation

and provisions for impairment, if required. Subsequent costs are capitalised if these result in enhancement of the asset.

Depreciation is provided on the depreciable amount of items of property, plant and equipment on a straight-line basis over their

estimated useful economic lives. Depreciation rates, methods and the residual values underlying the calculation of depreciation of

items of property, plant and equipment are kept under review to take account of any change in circumstances including consideration

on future Climate and Sustainability investments.

The Group uses the following annual rates in calculating depreciation:

|  |  |
| --- | --- |
|  |  |
| Annual rates in calculating depreciation | Depreciation rate |
| Freehold land | Not depreciated |
| Freehold buildings | 2- 3.3% |
| Leasehold property | Over the remaining life of the lease |
| Costs of adaptation of freehold and leasehold property | 6- 10% |
| Equipment installed in freehold and leasehold property | 6- 10% |
| Computers and similar equipment | 17- 33% |
| Fixtures and fittings and other equipment | 9- 20% |

Costs of adaptation and installed equipment are depreciated over the shorter of the life of the lease or the depreciation rates noted in

the table above.

Investment property

The Group initially recognises investment property at cost, and subsequently at fair value at each balance sheet date, reflecting market

conditions at the reporting date. Gains and losses on remeasurement are included in the income statement.

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|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets at amortised cost and other investments | | | | | | | | | | |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  | Investment  property | Property | Equipment | Right of use  assets 1 | Total |
|  | £m | £m | £m | £m | £m |
| Cost |  |  |  |  |  |
| As at 1 January 2023 | 5 | 3,585 | 3,018 | 1,950 | 8,558 |
| Additions | — | 112 | 297 | 20 | 429 |
| Disposals2 | (3) | (24) | (954) | (50) | (1,031) |
| Exchange and other movements | — | (95) | (14) | 82 | (27) |
| As at 31 December 2023 | 2 | 3,578 | 2,347 | 2,002 | 7,929 |
| Accumulated depreciation and impairment |  |  |  |  |  |
| As at 1 January 2023 | — | (1,642) | (2,244) | (1,056) | (4,942) |
| Depreciation charge | — | (163) | (256) | (157) | (576) |
| Impairment | — | (33) | — | (27) | (60) |
| Disposals2 | — | 10 | 944 | 48 | 1,002 |
| Exchange and other movements | — | 50 | (7) | 21 | 64 |
| As at 31 December 2023 | — | (1,778) | (1,563) | (1,171) | (4,512) |
| Net book value | 2 | 1,800 | 784 | 831 | 3,417 |
| Cost |  |  |  |  |  |
| As at 1 January 2022 | 7 | 4,131 | 3,210 | 1,920 | 9,268 |
| Additions | — | 273 | 313 | 37 | 623 |
| Disposals | (1) | (923) | (641) | (68) | (1,633) |
| Exchange and other movements | (1) | 104 | 136 | 61 | 300 |
| As at 31 December 2022 | 5 | 3,585 | 3,018 | 1,950 | 8,558 |
| Accumulated depreciation and impairment |  |  |  |  |  |
| As at 1 January 2022 | — | (2,255) | (2,586) | (872) | (5,713) |
| Depreciation charge | — | (181) | (227) | (206) | (614) |
| Impairment | — | (23) | 0 | (22) | (45) |
| Disposals | — | 882 | 630 | 65 | 1,577 |
| Exchange and other movements | — | (65) | (61) | (21) | (147) |
| As at 31 December 2022 | — | (1,642) | (2,244) | (1,056) | (4,942) |
| Net book value | 5 | 1,943 | 774 | 894 | 3,616 |

Notes

1 Right of use (ROU) asset balances relate to property leases under IFRS 16. Refer to Note 20 for further details.

2 Disposals primarily pertain to  fully depreciated assets which are not in use.

Property rentals of £12m (2022: £10m) have been included in other income.

The fair value of investment property is determined by reference to current market prices for similar properties, adjusted as necessary

for condition and location, or by reference to recent transactions updated to reflect current economic conditions. Discounted cash

flow techniques may be employed to calculate fair value where there have been no recent transactions, using current external market

inputs such as market rents and interest rates. Valuations are carried out by management with the support of appropriately qualified

independent valuers.

20 Leases

Accounting for leases

When the Group is the lessee, it is required to recognise both:

▪ A lease liability, measured at the present value of remaining cash flows on the lease, and

▪ A right of use (ROU) asset, measured at the amount of the initial measurement of the lease liability, plus any lease payments made

prior to commencement date, initial direct costs, and estimated costs of restoring the underlying asset to the condition required by

the lease, less any lease incentives received.

Subsequently the lease liability will increase for the accrual of interest, resulting in a constant rate of return throughout the life of the

lease, and reduce when payments are made. The right of use asset will amortise to the income statement over the life of the lease.

When the lease liability is remeasured, a corresponding adjustment is made to the carrying amount of the ROU asset, or is recorded in

the income statement if the carrying amount of the ROU asset has been reduced to nil.

On the balance sheet, the ROU assets are included within property, plant and equipment and the lease liabilities are included within

other liabilities.

The Group applies the recognition exemption in IFRS 16 for leases with a term not exceeding 12 months. For these leases the lease

payments are recognised as an expense on a straight line basis over the lease term unless another systematic basis is more

appropriate.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 461 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets at amortised cost and other investments | | | | | | | | | | |

When the Group is the lessor, the lease must be classified as either a finance lease or an operating lease. A finance lease is a lease which

confers substantially all the risks and rewards of the leased assets on the lessee. An operating lease is a lease where substantially all of

the risks and rewards of the leased asset remain with the lessor.

As a Lessor

Finance lease receivables are included within loans and advances at amortised cost.

The following table sets out a maturity analysis of lease receivables, showing the lease payments to be received after the reporting

date.

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  | 2023 | | | | 2022 | | | |
|  | Gross  investment in  finance lease  receivables | Future finance  income | Present value  of minimum  lease  payments  receivable | Unguaranteed  residual  values | Gross  investment in  finance lease  receivables | Future finance  income | Present value  of minimum  lease  payments  receivable | Unguaranteed  residual  values |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| Not more than one year | 3 | — | 3 | — | 14 | (1) | 13 | — |
| One to two years | 2 | — | 2 | — | 9 | (1) | 8 | — |
| Two to three years | — | — | — | — | 2 | — | 2 | — |
| Three to four years | — | — | — | — | 1 | — | 1 | — |
| Four to five years | — | — | — | — | 1 | — | 1 | — |
| Over five years | — | — | — | — | 1 | — | 1 | — |
| Total | 5 | — | 5 | — | 28 | (2) | 26 | — |

Barclays Asset Finance provided leasing and other asset finance facilities across a broad range of asset types to business and individual

customers. There is no significant impairment allowance for finance lease receivables in current and previous year.

The Group does not have any material operating leases as a lessor.

Finance lease income

Finance lease income is included within interest income. The following table shows amounts recognised in the income statement

during the year.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| Finance income from net investment in lease | 1 | 2 |
| Profit on sales | — | — |

As a Lessee

The Group leases various offices, branches and other premises under non-cancellable lease arrangements to meet its operational

business requirements. In some instances, Barclays will sublease property to third parties when it is no longer needed to meet business

requirements. Currently, Barclays does not have any material subleasing arrangements.

ROU asset balances relate to property leases only. Refer to Note 19 for the carrying amount of ROU assets.

The total expenses recognised during the year for short term leases were £2m (2022: £1m). The portfolio of short term leases to which

Barclays is exposed at the end of the year is not dissimilar to the expenses recognised in the year.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Lease liabilities |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| As at 1 January | 1,216 | 1,317 |
| Interest expense | 54 | 56 |
| New leases | 19 | 42 |
| Disposals | (11) | (13) |
| Cash payments1 | (406) | (239) |
| Exchange and other movements | 99 | 53 |
| As at 31 December (see Note 22) | 971 | 1,216 |

Note

1 Cash payments include one time lease liability payment of £182m related to structural cost action in relation to the real estate review.

|  |  |  |  |  |  |  |  |  |  |  |
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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets at amortised cost and other investments | | | | | | | | | | |

The below table sets out a maturity analysis of undiscounted lease liabilities, showing the lease payments after the reporting date.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Undiscounted lease liabilities maturity analysis |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| Not more than one year | 174 | 229 |
| One to two years | 169 | 216 |
| Two to three years | 144 | 193 |
| Three to four years | 120 | 160 |
| Four to five years | 97 | 140 |
| Five to ten years | 338 | 457 |
| Greater than ten years | 282 | 105 |
| Total undiscounted lease liabilities as at 31 December | 1,324 | 1,500 |

In addition to the cash flows identified above, Group is exposed to:

▪ Variable lease payments: This variability will typically arise from either inflation index instruments or market-based pricing

adjustments. Currently, Barclays has 517 (2022: 401) leases out of the total 756 (2022: 896) leases which have variable lease payment

terms based on market-based pricing adjustments. Of the gross cash flows identified above £1,062m (2022: £1,087m) is attributable

to leases with some degree of variability predominately linked to market-based pricing adjustments.

▪ Extension and termination options: The table above represents Barclays' best estimate of future cash outflows for leases, including

assumptions regarding the exercising of contractual extension and termination options. The above gross cash flows have been

reduced by £441m (2022: £516m) for leases where Barclays is highly expected to exercise an early termination option. However,

there is no significant impact where Barclays is expected to exercise an extension option.

In 2023, Group does not have any sale and leaseback transaction (2022: £88m).

The Group does not have any restrictions or covenants imposed by the lessor on its property leases which restrict its businesses.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 463 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets at amortised cost and other investments | | | | | | | | | | |

21 Goodwill and intangible assets

Accounting for goodwill and intangible assets

Goodwill

Goodwill arising on the acquisition of subsidiaries represents the excess of the fair value of the purchase consideration over the fair

value of the Group’s share of the assets acquired and the liabilities and contingent liabilities assumed on the date of the acquisition.

Goodwill is reviewed annually for impairment, or more frequently when there are indications that impairment may have occurred. The

test involves comparing the carrying value of a cash generating unit (CGU) including goodwill with the present value of the pre-tax cash

flows, discounted at a rate of interest that reflects the inherent risks, of the CGU to which the goodwill relates, or the CGU's fair value if

this is higher.

Intangible assets

Intangible assets are initially recognised when they are separable or arise from contractual or other legal rights, the cost can be

measured reliably and, in the case of intangible assets not acquired in a business combination, where it is probable that future economic

benefits attributable to the assets will flow from their use.

For internally generated intangible assets, only costs incurred during the development phase are capitalised. Expenditure in the

research phase is expensed when it is incurred.

Intangible assets are stated at cost (which is, in the case of assets acquired in a business combination, the acquisition date fair value)

less accumulated amortisation and impairment, if any, and are amortised over their useful lives in a manner that reflects the pattern to

which they contribute to future cash flows, generally using the amortisation periods set out below:

|  |  |
| --- | --- |
|  |  |
| Annual rates in calculating amortisation | Amortisation period |
| Goodwill | Not amortised |
| Internally generated software1 | 12 months to  6 years |
| Other software | 12 months to  6 years |
| Customer lists | 12 months to  25 years |
| Licences and other | 12 months to  25 years |

Note

1 Exceptions to the above rate relate to useful lives of certain core banking platforms that are assessed individually and, if appropriate, amortised over longer periods ranging from 10

to 15 years.

Intangible assets are reviewed for impairment when there are indications that impairment may have occurred. Intangible assets not yet

available for use are reviewed annually for impairment.

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|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets at amortised cost and other investments | | | | | | | | | | |

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  |  | Intangible assets | | | | |  |
|  | Goodwill | Internally  generated  software | Other  software | Brand | Customer  lists | Licences  and other | Total |
|  | £m | £m | £m | £m | £m | £m | £m |
| 2023 |  |  |  |  |  |  |  |
| Cost |  |  |  |  |  |  |  |
| As at 1 January 2023 | 4,737 | 7,627 | 620 | — | 1,654 | 984 | 15,622 |
| Additions | 311 | 1,203 | 164 | 7 | — | 4 | 1,689 |
| Disposals1 | — | (1,546) | 19 | — | — | (2) | (1,529) |
| Exchange and other movements2 | (13) | (94) | (86) | — | (85) | (830) | (1,108) |
| As at 31 December 2023 | 5,035 | 7,190 | 717 | 7 | 1,569 | 156 | 14,674 |
| Accumulated amortisation and  impairment |  |  |  |  |  |  |  |
| As at 1 January 2023 | (825) | (4,195) | (385) | — | (1,475) | (503) | (7,383) |
| Disposals1 | — | 1,546 | (26) | — | — | 2 | 1,522 |
| Amortisation charge | — | (1,050) | (69) | (1) | (39) | (49) | (1,208) |
| Impairment charge | (33) | (309) | (3) | — | — | — | (345) |
| Exchange and other movements2 | — | 43 | 5 | — | 76 | 410 | 534 |
| As at 31 December 2023 | (858) | (3,965) | (478) | (1) | (1,438) | (140) | (6,880) |
| Net book value | 4,177 | 3,225 | 239 | 6 | 131 | 16 | 7,794 |
| 2022 |  |  |  |  |  |  |  |
| As at 1 January 2022 | 4,718 | 7,180 | 626 | — | 1,431 | 908 | 14,863 |
| Additions | — | 1,047 | 18 | — | 76 | 19 | 1,160 |
| Disposals1 | — | (774) | (36) | — | (12) | (39) | (861) |
| Exchange and other movements | 19 | 174 | 12 | — | 159 | 96 | 460 |
| As at 31 December 2022 | 4,737 | 7,627 | 620 | — | 1,654 | 984 | 15,622 |
| Accumulated amortisation and  impairment |  |  |  |  |  |  |  |
| As at 1 January 2022 | (825) | (3,884) | (364) | — | (1,300) | (429) | (6,802) |
| Disposals1 | — | 774 | 36 | — | 12 | 39 | 861 |
| Amortisation charge | — | (946) | (50) | — | (44) | (69) | (1,109) |
| Impairment charge | — | (18) | — | — | — | — | (18) |
| Exchange and other movements | — | (121) | (7) | — | (143) | (44) | (315) |
| As at 31 December 2022 | (825) | (4,195) | (385) | — | (1,475) | (503) | (7,383) |
| Net book value | 3,912 | 3,432 | 235 | — | 179 | 481 | 8,239 |

Notes

1 Disposals pertain to  fully amortised  assets which are  not in use.

2 In the current year the group has reclassified assets with a total net book value of £412m recognised on balance sheet relating to sign-on bonus payments made to co-brand credit card

partners from Intangible Assets (Licenses and other) to Other Assets. This change in classification has been made to more appropriately reflect the nature of the assets.

The German consumer finance business moved to assets held for sale during the year and this resulted in an impairment of Intangible

assets of £32m.

Goodwill

Goodwill and Intangible assets are allocated to business operations according to business segments as follows:

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
|  | 2023 | | |  | 2022 | | |
|  | Goodwill | Intangibles | Total |  | Goodwill | Intangibles | Total |
|  | £m | £m | £m |  | £m | £m | £m |
| Barclays UK | 3,872 | 1,096 | 4,968 |  | 3,560 | 1,263 | 4,823 |
| Barclays International | 267 | 2,519 | 2,786 |  | 310 | 3,062 | 3,372 |
| Head Office | 38 | 2 | 40 |  | 42 | 2 | 44 |
| Total | 4,177 | 3,617 | 7,794 |  | 3,912 | 4,327 | 8,239 |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 465 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets at amortised cost and other investments | | | | | | | | | | |

Critical accounting estimates and judgements

Goodwill

Testing goodwill for impairment involves a significant amount of judgement. Goodwill is allocated to CGUs for the purpose of

impairment testing.  The review of goodwill for impairment involves calculating a value in use (VIU) valuation which is compared to the

carrying value of a CGU associated with the goodwill to determine whether any impairment has occurred. This includes the

identification of independent CGUs across the organisation and the allocation of goodwill to those CGUs.

The calculation of a value in use contains a high degree of uncertainty in estimating the future cash flows and the rates used to discount

them. Key judgements include determining the carrying value of the CGU, the cash flows and discount rates used in the calculation.

▪ The cash flow forecasts used by management involve judgement and are based upon a view of the prospects of the business and

market conditions at the point in time the assessment is prepared, including the potential effect of climate change. The estimation of

cash flows is sensitive to the periods for which detailed forecasts are available and to assumptions regarding long-term sustainable

cash flows .

▪ The discount rates applied to the future cash flows also involve judgement as they can have a significant impact on the valuation.

The discount rates used are compared to market participants to ensure that they are appropriate and based on an estimated cost of

equity for each CGU.

▪ The choice of a terminal growth rate used to determine the present value of the future cash flows of the CGUs is also a judgement

that can impact the outcome of the assessment. The terminal growth rate and discount rates used may vary due to external market

rates and economic conditions that are beyond management’s control, including the potential effect of climate change.

Further details of some of the key judgements are set out below.

2023 impairment review

The 2023 impairment review was performed during Q4 2023, with the approach and analysis set out below.

Determining the carrying value of CGUs

The carrying value for each CGU is the sum of the tangible equity, goodwill and intangible asset balances associated with that CGU.

The Group manages the assets and liabilities of its CGUs with reference to the tangible equity of the respective businesses. That

tangible equity is derived from the level of risk weighted assets (RWAs) and capital required to be deployed in the CGU and therefore

reflects its relative risk, as well as the level of capital that management consider a market participant would be required to hold and

retain to support business growth.

Goodwill is initially allocated to CGUs or groups of CGUs that are expected to benefit from the synergies of the acquisition that

generated it. Goodwill is only reallocated if there is a change in its use or when reporting structures are altered in a way that changes the

composition of one or more cash-generating units to which goodwill has been allocated. During the year, the Merchant Acquiring

business was split from the Cards & Payments business and was identified as a CGU.

Cash flows

The five-year cash flows used in the calculation are based on the formally agreed medium-term plans approved by the Board. These are

prepared using macroeconomic assumptions which management consider reasonable and supportable, and reflect business agreed

initiatives for the forecast period. The macroeconomic assumptions underpinning the medium term plan were determined during 2023

and management has considered whether there are subsequent significant changes in those assumptions which would adversely

impact the results of the impairment review.

As required by IAS 36, estimates of future cash flows exclude cash inflows or outflows that are expected to arise from restructuring

initiatives where a constructive obligation to carry out the plan does not yet exist.

In line with prior year treatment, the Education, Social Housing and Local Authority (ESHLA) portfolio has been excluded from the

Business Banking CGU cash flows. This is a legacy loan portfolio which was previously within the Non-Core bank and was not part of the

business to which the goodwill relates. As such, the cash flows relating to this portfolio have been excluded from the Business Banking

VIU calculation.

Discount rates

IAS 36 requires that the discount rate used in a value in use calculation reflects the pre-tax rate an investor would require if they were to

choose an investment that would generate similar cash flows to those that the entity expects to generate from the asset. In

determining the discount rate, management identified the cost of equity associated with market participants that closely resemble the

Group's CGUs. The cost of equity has been used as the discount rate in the impairment assessment and applied to the post tax cash

flows of the CGU. This post-tax method incorporates the impact of changing tax rates on the cash flows and is expected to produce

the same VIU result as a pre-tax method adjusted for varying tax rates. Using the resultant VIU the equivalent pre-tax discount rate has

been calculated. The cost of equity rate used for all CGUs in this year’s calculation has been increased to the reflect the relative volatility

of Barclays PLC’s stock price versus the average of our peers. The range of equivalent pre-tax discount rates applicable across the

CGUs range from 14.7% to 18.5% (2022: 14.1% to 16.5%).

Terminal growth rate

The terminal growth rate is used to estimate the effect of projecting cash flows to the end of an asset’s useful economic life. It is

management’s judgement that the cash flows associated with the CGUs will grow in line with the major economies in which the Group

operates. Inflation rates are used as an approximation of future growth rates and form the basis of the terminal growth rates applied.

The terminal growth rate used is 2.0% (2022: 2.0%).

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 466 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets at amortised cost and other investments | | | | | | | | | | |

Outcome of goodwill and intangibles review

The Personal Banking and Business Banking CGUs carry the majority of the Group’s goodwill balance, predominantly as a consequence

of the Woolwich acquisition. The goodwill within Personal Banking was £3,064m ( 2022: £2,752m), of which £2,501m  (2022: £2,501m)

was attributable to Woolwich, and within Business Banking was £629m (2022: £629m), fully attributable to Woolwich.

The largest portion of the Group's intangible assets sits within the Investment Bank CGU, part of Barclays International with an

allocation of £1,043m (2022: £919m).

The recoverable amount for both Personal Banking and Business Banking have decreased in comparison to the 2022 impairment

review, reflective of changes in the interest rate and macroeconomic outlook.

An impairment of £33m of goodwill and £257m of intangible assets has been identified and recognised for the year, fully impairing the

goodwill and intangibles of the Merchant Acquiring CGU.  In all other CGUs, the value in use exceeds the carrying value and no

impairment has been identified.

The outcome of the impairment review for Personal Banking, Business Banking, Barclaycard UK and Cards and Payments  are set out

below:

|  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |
| Cash generating unit | Tangible equity | Goodwill | Intangibles | Carrying value | Value in use | Value in use  exceeding carrying  value | Value in use  exceeding carrying  value 2022 |
|  | £m | £m | £m | £m | £m | £m | £m |
| Personal Banking | 6,130 | 3,066 | 740 | 9,936 | 12,297 | 2,361 | 4,667 |
| Cards and Payments | 3,626 | 180 | 800 | 4,606 | 5,342 | 736 | 1,598 |
| Business Banking | 1,836 | 629 | 239 | 2,704 | 5,990 | 3,286 | 6,623 |
| Barclaycard UK | 1,938 | 179 | 164 | 2,281 | 2,307 | 26 | 364 |
| Total | 13,530 | 4,054 | 1,943 | 19,527 | 25,936 | 6,409 | 13,252 |

All CGUs showed a reduction in value in use in the period which is mainly attributable to the increase in the discount rates used in the

assessment as a result of increases in interest rates as well as the introduction of the Barclays share price volatility premium.

The value in use for Barclaycard UK has reduced to a level that an adverse movement in any of the key judgement areas would result in

an impairment.

Sensitivity of key judgements

The CGUs are sensitive to possible adverse changes in the key assumptions that support the recoverable amount:

Cash flows: The medium-term plans used to determine the cash flows used in the VIU calculation rely on macroeconomic forecasts,

including interest rates, GDP and unemployment, and forecast levels of market and client activity. Interest rate assumptions impact

planned cash flows from both customer income and structural hedge contributions and therefore cash flow expectations are highly

sensitive to movements in the yield curve. The cash flows also contain assumptions with regard to the prudential and financial conduct

regulatory environment which may be subject to change. Given the current level of economic uncertainty, a 10% reduction in cash

flows has been provided to show the sensitivity of the outcome to a change in these key assumptions.

Discount rate: The discount rate should reflect the market risk-free rate adjusted for the inherent risks of the business it is applied to.

Management have identified discount rates for comparable businesses and consider these to be a reasonable estimate of a suitable

market rate for the profile of the business unit being tested. The risk that these discount rates may not be appropriate is quantified

below and shows the impact of a 100bps change in the discount rate.

Terminal growth rate: The terminal growth rate is used to estimate the cash flows into perpetuity based on the expected longevity of

the CGU's businesses. The terminal growth rate is sensitive to uncertainties in the macroeconomic environment. The risk that using

inflation data may not be appropriate for its determination is quantified below and shows the impact of 100bps change in the terminal

growth rate.

Allocated capital rate: Tangible equity is allocated based on the level of risk weighted assets (RWAs) and capital required to be

deployed in the CGU which is dependent on the relative risk of businesses. The capital ratio used in determining the level of tangible

equity allocated to the CGU and its capital cash flows could move over time. The impact of a 50bps increase in capital ratio is quantified

below.

The sensitivity of the value in use to key judgements in the calculations for certain CGUs holding goodwill balances is set out below:

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Cash generating unit | Carrying  value | Value in  use | Value in  use  exceeding  carrying  value | Discount  rate | Terminal  growth  rate | Reduction in headroom | | | | Change required to reduce headroom to zero | | | |
| 100 bps  increase  in the  discount  rate | 100 bps  decrease  in terminal  growth  rate | 50 bps  increase to  allocated  capital rate | 10%  reduction in  forecasted  cash flows | Discount  rate | Terminal  growth  rate | Allocated  capital  rate | Cash  flows |
|  | £m | £m | £m | % | % | £m | £m | £m | £m | % | % | % | % |
| Personal Banking | 9,936 | 12,297 | 2,361 | 18.2 | 2.0 | (1,042) | (710) | (263) | (1,337) | 2.5 | (4.1) | 4.5 | (17.6) |
| Cards and Payments | 4,606 | 5,342 | 736 | 16.8 | 2.0 | (647) | (473) | (250) | (724) | 1.2 | (1.6) | 1.5 | (10.2) |
| Total | 14,542 | 17,639 | 3,097 |  |  |  |  |  |  |  |  |  |  |

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 467 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Assets at amortised cost and other investments | | | | | | | | | | |

#### Accruals, provisions, contingent liabilities and legal proceedings

The notes included in this section focus on the Group’s accruals, provisions and contingent liabilities. Provisions are recognised for

present obligations arising as consequences of past events where it is probable that a transfer of economic benefit will be necessary to

settle the obligation, and it can be reliably estimated. Contingent liabilities reflect potential liabilities that are not recognised on the

balance sheet.

22 Other liabilities

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| Accruals and deferred income | 4,315 | 4,618 |
| Other creditors | 6,638 | 7,870 |
| Items in the course of collection due to other banks | 89 | 85 |
| Lease liabilities (refer to Note 20) | 971 | 1,216 |
| Other liabilities | 12,013 | 13,789 |

23 Provisions

Accounting for provisions

Provisions are recognised for present obligations arising as consequences of past events where it is more likely than not that a transfer

of economic benefit will be necessary to settle the obligation, which can be reliably estimated.

Critical accounting estimates and judgements

The financial reporting of provisions involves a significant degree of judgement and is complex. Identifying whether a present obligation

exists and estimating the probability, timing, nature and quantum of the outflows that may arise from past events requires judgements

to be made based on the specific facts and circumstances relating to individual events and often requires specialist professional advice.

When matters are at an early stage, accounting judgements and estimates can be difficult because of the high degree of uncertainty

involved. Management continues to monitor matters as they develop to re-evaluate on an ongoing basis whether provisions should be

recognised, however there can remain a wide range of possible outcomes and uncertainties, particularly in relation to legal, competition

and regulatory matters, and as a result it is often not practicable to make meaningful estimates even when matters are at a more

advanced stage.

The amount that is recognised as a provision can also be very sensitive to the assumptions made in calculating it. This gives rise to a

large range of potential outcomes which require judgement in determining an appropriate provision level. See Note 25 for more detail of

legal, competition and regulatory matters.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  |  |  | Legal,  competition and  regulatory  matters | Sundry  provisions |  |
|  | Redundancy and  restructuring | Customer redress | Total |
|  | £m | £m | £m | £m | £m |
| As at 1 January 2023 | 136 | 378 | 159 | 288 | 961 |
| Additions | 469 | 84 | 29 | 132 | 714 |
| Amounts utilised | (166) | (152) | (75) | (56) | (449) |
| Unused amounts reversed | (38) | (60) | (11) | (69) | (178) |
| Exchange and other movements | (4) | 45 | (3) | (6) | 32 |
| As at 31 December 2023 | 397 | 295 | 99 | 289 | 1,080 |
| Undrawn contractually committed facilities and guarantees1 |  |  |  |  |  |
| As at 1st January 2023 |  |  |  |  | 583 |
| Net change in expected credit loss provision and other movements |  |  |  |  | (79) |
| As at 31 December 2023 |  |  |  |  | 504 |
| Total Provisions |  |  |  |  |  |
| As at 1st January 2023 |  |  |  |  | 1,544 |
| As at 31 December 2023 |  |  |  |  | 1,584 |

Note

1 Undrawn contractually committed facilities and guarantees provisions are accounted for under IFRS 9. Further analysis of the movement in the expected credit loss provision is

disclosed within the 'Movement in gross exposures and impairment allowance including provisions for loan commitments and financial guarantees' table on page [298](#i4be61753b7f243b19551b0bfbf3a2a0d_715).

Provisions expected to be recovered or settled within no more than 12 months after 31 December 2023 were £1,357m (2022:

£1,348m).

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|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 468 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Accruals, provisions, contingent liabilities and legal proceedings | | | | | | | | | | |

Redundancy and restructuring

These provisions comprise the estimated cost of restructuring, including redundancy costs where an obligation exists. For example,

when the Group has a detailed formal plan for restructuring a business and has raised valid expectations in those affected by the

restructuring by announcing its main features or starting to implement the plan.

Customer redress

Customer redress provisions comprise the estimated cost of making redress payments to customers, clients and counterparties for

losses or damages associated with inappropriate judgement in the execution of the Group’s business activities.

Legal, competition and regulatory matters

The Group is engaged in various legal proceedings, both in the UK and a number of other overseas jurisdictions, including the US. For

further information in relation to legal proceedings and discussion of the associated uncertainties, refer to  Note 25.

Sundry provisions

This category includes provisions that do not fit into any of the other categories, such as fraud losses and dilapidation provisions.

Undrawn contractually committed facilities and guarantees

Impairment allowance under IFRS 9 considers both the drawn and the undrawn counterparty exposure. For retail portfolios, the total

impairment allowance is allocated to the drawn exposure to the extent that the allowance does not exceed the exposure as ECL is not

reported separately. Any excess is reported on the liability side of the balance sheet as a provision. For wholesale portfolios, the

impairment allowance on the undrawn exposure is reported on the liability side of the balance sheet as a provision. For further

information, refer to the Credit risk section for loan commitments and financial guarantees on page [298](#i4be61753b7f243b19551b0bfbf3a2a0d_715).

24 Contingent liabilities and commitments

Accounting for contingent liabilities

Contingent liabilities are possible obligations whose existence will be confirmed only by uncertain future events and present obligations

where the transfer of economic resources is uncertain or cannot be reliably measured. Contingent liabilities are not recognised on the

balance sheet but are disclosed unless the likelihood of an outflow of economic resources is remote.

The following table summarises the nominal principal amount of contingent liabilities and commitments which are not recorded on-

balance sheet:

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| Guarantees and letters of credit pledged as collateral security | 17,353 | 17,760 |
| Performance guarantees, acceptances and endorsements | 7,987 | 6,445 |
| Total contingent liabilities and financial guarantees | 25,340 | 24,205 |
| Of which: Financial guarantees and letters of credit carried at fair value | 1,266 | 1,423 |
|  |  |  |
| Documentary credits and other short-term trade related transactions | 2,352 | 1,748 |
| Standby facilities, credit lines and other commitments | 388,085 | 393,760 |
| Total commitments | 390,437 | 395,508 |
| Of which: Loan commitments carried at fair value | 15,203 | 13,471 |

Provisions for expected credit losses held against contingent liabilities and commitments equal £504m (2022: £583m) and are reported

in Note 23. Further details on contingent liabilities relating to legal and competition and regulatory matters can be found in Note 25.

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 469 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Accruals, provisions, contingent liabilities and legal proceedings | | | | | | | | | | |

25 Legal, competition and regulatory matters

The Group faces legal, competition and regulatory challenges, many of which are beyond our control. The extent of the impact of these

matters cannot always be predicted but may materially impact our operations, financial results, condition and prospects. Matters arising

from a set of similar circumstances can give rise to either a contingent liability or a provision, or both, depending on the relevant facts

and circumstances.

The recognition of provisions in relation to such matters involves critical accounting estimates and judgments in accordance with the

relevant accounting policies applicable to Note 24, Provisions. We have not disclosed an estimate of the potential financial impact or

effect on the Group of contingent liabilities where it is not currently practicable to do so. Various matters detailed in this note seek

damages of an unspecified amount. While certain matters specify the damages claimed, such claimed amounts do not necessarily

reflect the Group’s potential financial exposure in respect of those matters.

Matters are ordered under headings corresponding to the financial statements in which they are disclosed.

1. Barclays PLC and Barclays Bank PLC

Investigations into certain advisory services agreements and other proceedings

FCA proceedings

In 2008, Barclays Bank PLC and Qatar Holdings LLC entered into two advisory service agreements (the Agreements). The Financial

Conduct Authority (FCA) conducted an investigation into whether the Agreements may have related to Barclays PLC’s capital raisings

in June and November 2008 (the Capital Raisings) and therefore should have been disclosed in the announcements or public

documents relating to the Capital Raisings. In 2013, the FCA issued warning notices (the Warning Notices) finding that Barclays PLC and

Barclays Bank PLC acted recklessly and in breach of certain disclosure-related listing rules, and that Barclays PLC was also in breach of

Listing Principle 3. The financial penalty provided in the Warning Notices was £50m. Barclays PLC and Barclays Bank PLC contested the

findings. In September 2022, the FCA’s Regulatory Decisions Committee (RDC) issued Decision Notices finding that Barclays PLC and

Barclays Bank PLC breached certain disclosure-related listing rules. The RDC also found that in relation to the disclosures made in the

Capital Raising of November 2008, Barclays PLC and Barclays Bank PLC acted recklessly, and that Barclays PLC breached Listing

Principle 3. The RDC upheld the combined penalty of £50m on Barclays PLC and Barclays Bank PLC, the same penalty as in the Warning

Notices. Barclays PLC and Barclays Bank PLC have referred the RDC’s findings to the Upper Tribunal for reconsideration.

Other proceedings

In November 2023, Barclays received requests for arbitration from two Jersey special purpose vehicles connected to PCP International

Finance Limited asserting claims in relation to the October 2008 capital raising. Barclays is defending these claims.

Investigations into LIBOR and other benchmarks and related civil actions

Regulators and law enforcement agencies, including certain competition authorities, from a number of governments have conducted

investigations relating to Barclays Bank PLC’s involvement in allegedly manipulating certain financial benchmarks, such as LIBOR.

Various individuals and corporates in a range of jurisdictions have threatened or brought civil actions against the Group and other banks

in relation to the alleged manipulation of LIBOR and/or other benchmarks.

USD LIBOR civil actions

The majority of the USD LIBOR cases, which have been filed in various US jurisdictions, have been consolidated for pre-trial purposes in

the US District Court in the Southern District of New York (SDNY). The complaints are substantially similar and allege, among other

things, that Barclays PLC, Barclays Bank PLC, Barclays Capital Inc. (BCI) and other financial institutions individually and collectively

violated provisions of the US Sherman Antitrust Act (Antitrust Act), the US Commodity Exchange Act (CEA), the US Racketeer

Influenced and Corrupt Organizations Act (RICO), the US Securities Exchange Act of 1934 and various state laws by manipulating USD

LIBOR rates.

Putative class actions and individual actions seek unspecified damages with the exception of one lawsuit, in which the plaintiffs are

seeking no less than $100m in actual damages and additional punitive damages against all defendants, including Barclays Bank PLC.

Some of the lawsuits also seek trebling of damages under the Antitrust Act and RICO.

Sterling LIBOR civil actions

In 2016, two putative class actions filed in the SDNY against Barclays Bank PLC, BCI and other Sterling LIBOR panel banks alleging,

among other things, that the defendants manipulated the Sterling LIBOR rate in violation of the Antitrust Act, CEA and RICO, were

consolidated. The defendants’ motion to dismiss the claims was granted in 2018. The plaintiffs have appealed the dismissal.

Japanese Yen LIBOR civil actions

In 2012, a putative class action was filed in the SDNY against Barclays Bank PLC and other Japanese Yen LIBOR panel banks by a lead

plaintiff involved in exchange-traded derivatives and members of the Japanese Bankers Association’s Euroyen Tokyo Interbank

Offered Rate (Euroyen TIBOR) panel. The complaint alleges, among other things, manipulation of the Euroyen TIBOR and Yen LIBOR

rates and breaches of the CEA and the Antitrust Act. In 2014, the court dismissed the plaintiff’s antitrust claims, and, in 2020, the court

dismissed the plaintiff’s remaining CEA claims.

In 2015, a second putative class action, making similar allegations to the above class action, was filed in the SDNY against Barclays PLC,

Barclays Bank PLC and BCI. Barclays and the plaintiffs reached a settlement of $17.75 m for both actions, which received final court

approval in March 2023. This matter is now concluded.

ICE LIBOR civil action

In August 2020, an action related to the LIBOR benchmark administered by the Intercontinental Exchange Inc. and certain of its

affiliates (ICE) was filed by a group of individual plaintiffs in the US District Court for the Northern District of California on behalf of

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 470 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Accruals, provisions, contingent liabilities and legal proceedings | | | | | | | | | | |

individual borrowers and consumers of loans and credit cards with variable interest rates linked to USD ICE LIBOR. The plaintiffs’ motion

seeking, among other things, preliminary and permanent injunctions to enjoin the defendants from continuing to set LIBOR or enforce

any financial instrument that relies in whole or in part on USD LIBOR was denied. The defendants’ motion to dismiss the case was

granted in September 2022. The plaintiffs filed an amended complaint, which was dismissed in October 2023. The plaintiffs are

appealing the dismissal.

Non-US benchmarks civil actions

There remains one claim, issued in 2017, against Barclays Bank PLC and other banks in the UK in connection with alleged manipulation

of LIBOR. Proceedings have also been brought in a number of other jurisdictions in Europe, Argentina and Israel relating to alleged

manipulation of LIBOR and EURIBOR. Additional proceedings in other jurisdictions may be brought in the future.

Foreign Exchange investigations and related civil actions

The Group has been the subject of investigations in various jurisdictions in relation to certain sales and trading practices in the Foreign

Exchange market. Settlements were reached in various jurisdictions in connection with these investigations, including the EU and US.

The financial impact of any remaining ongoing investigations is not expected to be material to the Group’s operating results, cash flows

or financial position. Various individuals and corporates in a range of jurisdictions have threatened or brought civil actions against the

Group and other banks in relation to alleged manipulation of Foreign Exchange markets.

US FX opt out civil action

In 2018, Barclays Bank PLC and BCI settled a consolidated action filed in the SDNY, alleging manipulation of Foreign Exchange markets

(Consolidated FX Action), for a total amount of $384m. Also in 2018, a group of plaintiffs, who opted out of the Consolidated FX Action,

filed a complaint in the SDNY against Barclays PLC, Barclays Bank PLC, BCI and other defendants. Some of the plaintiffs’ claims were

dismissed in 2020. Barclays PLC, Barclays Bank PLC, and BCI have reached a settlement of all claims against them in the matter. A

settlement payment was made in April 2023 and the matter is now concluded. The financial impact of this settlement is not material to

the Group’s operating results, cash flows or financial position.

US retail basis civil action

In 2015, a putative class action was filed against several international banks, including Barclays PLC and BCI, on behalf of a proposed

class of individuals who exchanged currencies on a retail basis at bank branches (Retail Basis Claims). The SDNY has ruled that the Retail

Basis Claims are not covered by the settlement agreement in the Consolidated FX Action. The Court subsequently dismissed all Retail

Basis Claims against the Group and all other defendants. The plaintiffs filed an amended complaint. The defendants’ motion for

summary judgment was granted in March 2023, dismissing the plaintiffs’ remaining claims. The plaintiffs have appealed the decision.

Non-US FX civil actions

Legal proceedings have been brought or are threatened against Barclays PLC, Barclays Bank PLC, BCI and Barclays Execution Services

Limited (BX) in connection with alleged manipulation of Foreign Exchange in the UK, a number of other jurisdictions in Europe, Israel,

Brazil and Australia. Additional proceedings may be brought in the future.

The above-mentioned proceedings include two purported class actions filed against Barclays PLC, Barclays Bank PLC, BX, BCI and

other financial institutions in the UK Competition Appeal Tribunal (CAT) in 2019. The CAT refused to certify these claims in the first

quarter of 2022.  In July 2023 (as amended in November 2023), the Court of Appeal overturned the CAT’s decision and found that the

claims should be certified on an opt out basis. The Court of Appeal upheld the CAT’s determination as to which of the two purported

class representatives should be chosen to bring the claim. Subject to any further appeal, only the claim brought by the chosen class

representative will now proceed in the CAT. Also in 2019, a separate claim was filed in the UK in the High Court of Justice (High Court),

and subsequently transferred to the CAT, by various banks and asset management firms against Barclays Bank PLC and other financial

institutions alleging breaches of European and UK competition laws related to FX trading. This claim has been settled as part of the

settlement payment referred to under the US FX opt out civil action above and the matter is now concluded.

Metals-related civil actions

A US civil complaint alleging manipulation of the price of silver in violation of the CEA, the Antitrust Act and state antitrust and consumer

protection laws was brought by a proposed class of plaintiffs against a number of banks, including Barclays Bank PLC, BCI and BX, and

transferred to the SDNY. The complaint was dismissed against these Barclays entities and certain other defendants in 2018, and

against the remaining defendants in May 2023. The plaintiffs have appealed the dismissal of the complaint against all defendants.

Civil actions have also been filed in Canadian courts against Barclays PLC, Barclays Bank PLC, Barclays Capital Canada Inc. and BCI on

behalf of proposed classes of plaintiffs alleging manipulation of gold and silver prices.

US residential mortgage related civil actions

There are two US Residential Mortgage-Backed Securities (RMBS) related civil actions arising from unresolved repurchase requests

submitted by Trustees for certain RMBS, alleging breaches of various loan-level representations and warranties (R&Ws) made by

Barclays Bank PLC and/or a subsidiary acquired in 2007. In one action, the parties have agreed to settle the litigation. The financial

impact of the settlement is not material to the Group’s operating results, cash flows or financial position. Barclays’ motion to dismiss

the other repurchase action was denied in October 2023. Barclays is appealing the decision.

Government and agency securities civil actions

Treasury auction securities civil actions

Consolidated putative class action complaints filed in US federal court against Barclays Bank PLC, BCI and other financial institutions

under the Antitrust Act and state common law allege that the defendants (i) conspired to manipulate the US Treasury securities market

and/or (ii) conspired to prevent the creation of certain platforms by boycotting or threatening to boycott such trading platforms. The

court dismissed the consolidated action in March 2021.The plaintiffs filed an amended complaint. The defendants’ motion to dismiss

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 471 |
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| Notes to the financial statements (continued) | | | | | | | | | | |
| Accruals, provisions, contingent liabilities and legal proceedings | | | | | | | | | | |

the amended complaint was granted in March 2022. The plaintiffs appealed this decision, and in February 2024 the appellate court

affirmed the dismissal.

In addition, certain plaintiffs have filed a related, direct action against BCI and certain other financial institutions, alleging that defendants

conspired to fix and manipulate the US Treasury securities market in violation of the Antitrust Act, the CEA and state common law. This

action remains stayed.

Supranational, Sovereign and Agency bonds civil actions

Civil antitrust actions have been filed in the SDNY and Federal Court of Canada in Toronto against Barclays Bank PLC, BCI, BX, Barclays

Capital Securities Limited and, with respect to the civil action filed in Canada only, Barclays Capital Canada, Inc. and other financial

institutions alleging that the defendants conspired to fix prices and restrain competition in the market for US dollar-denominated

Supranational, Sovereign and Agency bonds. The SDNY actions were dismissed and these matters are now concluded.

In the Federal Court of Canada action, the parties have reached a settlement in principle, which will require court approval. The financial

impact of the settlement is not expected to be material to the Group’s operating results, cash flows or financial position.

Variable Rate Demand Obligations civil actions

Civil actions have been filed against Barclays Bank PLC and BCI and other financial institutions alleging the defendants conspired or

colluded to artificially inflate interest rates set for Variable Rate Demand Obligations (VRDOs). VRDOs are municipal bonds with interest

rates that reset on a periodic basis, most commonly weekly. Two actions in state court have been filed by private plaintiffs on behalf of

the states of Illinois and California. Three putative class action complaints have been consolidated in the SDNY. In the consolidated

SDNY class action, certain of the plaintiffs’ claims were dismissed in November 2020 and June 2022 and the plaintiffs’ motion for class

certification was granted in September 2023, which means the case may proceed as a class action. The defendants are appealing this

decision. In the California action, the California appeals court reversed the dismissal of the plaintiffs’ claims in April 2023. In the Illinois

action, the defendants reached a settlement with the Attorney General for the State of Illinois to resolve the litigation. The court

approved the settlement in October 2023 and dismissed the matter. The financial impact of the settlement is not material to the

Group’s operating results, cash flows or financial position. This matter is now concluded.

Odd-lot corporate bonds antitrust class action

In 2020, BCI, together with other financial institutions, were named as defendants in a putative class action. The complaint alleges a

conspiracy to boycott developing electronic trading platforms for odd-lots and price fixing. The plaintiffs demand unspecified money

damages. The defendants’ motion to dismiss was granted in 2021 and the plaintiffs have appealed the dismissal.

Credit Default Swap civil action

A putative antitrust class action is pending in New Mexico federal court against Barclays Bank PLC, BCI and various other financial

institutions. The plaintiffs, the New Mexico State Investment Council and certain New Mexico pension funds, allege that the defendants

conspired to manipulate the benchmark price used to value Credit Default Swap (CDS) contracts at settlement (i.e. the CDS final

auction price). The plaintiffs allege violations of US antitrust laws and the CEA, and unjust enrichment under state law. The defendants’

motion to dismiss was denied in June 2023.

Interest rate swap and credit default swap US civil actions

Barclays PLC, Barclays Bank PLC and BCI, together with other financial institutions that act as market makers for interest rate swaps

(IRS), are named as defendants in several antitrust actions, including one putative class action and individual actions brought by certain

swap execution facilities, which are consolidated in the SDNY. The complaints allege the defendants conspired to prevent the

development of exchanges for IRS and demand unspecified money damages. The plaintiffs’ motion for class certification was denied in

December 2023, meaning the case cannot proceed as a class action. The plaintiffs have sought the court’s leave to appeal that

decision.

In 2017, Tera Group Inc. (Tera) filed a separate civil antitrust action in the SDNY claiming that certain conduct alleged in the IRS cases

also caused Tera to suffer harm with respect to the Credit Default Swaps market. In 2019, the court dismissed Tera’s claims for unjust

enrichment and tortious interference but denied motions to dismiss the antitrust claims. Tera filed an amended complaint in January

2020. Barclays’ motion to dismiss all claims was granted in August 2023. Tera has filed a Notice of Appeal.

BDC Finance L.L.C.

In 2008, BDC Finance L.L.C. (BDC) filed a complaint in the Supreme Court of the State of New York (NY Supreme Court), demanding

damages of $298m, alleging that Barclays Bank PLC had breached a contract in connection with a portfolio of total return swaps

governed by an ISDA Master Agreement (the Master Agreement). Following a trial, the court ruled in 2018 that Barclays Bank PLC was

not a defaulting party, which was affirmed on appeal. In April 2021, the trial court entered judgment in favour of Barclays Bank PLC for

$3.3m and as yet to be determined legal fees and costs. BDC appealed. In January 2022, the appellate court reversed the trial court’s

summary judgment decision in favour of Barclays Bank PLC and remanded the case to the lower court for further proceedings. The

parties filed cross-motions on the scope of trial. In January 2024, the court ruled in Barclays’ favour. BDC is appealing, and the trial is

adjourned until the appeal is decided.

In 2011, BDC’s investment advisor, BDCM Fund Adviser, LLC and its parent company, Black Diamond Capital Holdings, LLC, also sued

Barclays Bank PLC and BCI in Connecticut State Court for unspecified damages allegedly resulting from Barclays Bank PLC’s conduct

relating to the Master Agreement, asserting claims for violation of the Connecticut Unfair Trade Practices Act and tortious interference

with business and prospective business relations. This case has been withdrawn.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Accruals, provisions, contingent liabilities and legal proceedings | | | | | | | | | | |

Civil actions in respect of the US Anti-Terrorism Act

Eight civil actions, on behalf of more than 4,000 plaintiffs, were filed in US federal courts in the US District Court in the Eastern District of

New York (EDNY) and SDNY against Barclays Bank PLC and a number of other banks. The complaints generally allege that Barclays Bank

PLC and those banks engaged in a conspiracy to facilitate US dollar-denominated transactions for the Iranian Government and various

Iranian banks, which in turn funded acts of terrorism that injured or killed the plaintiffs or the plaintiffs’ family members. The plaintiffs

seek to recover damages for pain, suffering and mental anguish under the provisions of the US Anti-Terrorism Act, which allow for the

trebling of any proven damages.

The court granted the defendants’ motions to dismiss three out of the six actions in the EDNY. The plaintiffs appealed in one action and

the dismissal was affirmed, and judgment was entered, in January 2023. The court has given the plaintiffs until February 2024 to make a

motion to vacate the judgment. The other two dismissed actions in the EDNY were consolidated into one action. The plaintiffs in that

action, and in one other action in the EDNY, filed amended complaints in December 2023. The two other actions in the EDNY are

currently stayed. Out of the two actions in the SDNY, the court granted the defendants’ motion to dismiss the first action. That action is

stayed, and the second SDNY action is stayed pending any appeal on the dismissal of the first.

Shareholder derivative action

In November 2020, a purported Barclays shareholder filed a putative derivative action in New York state court against BCI and a number

of current and former members of the Board of Directors of Barclays PLC and senior executives or employees of the Group. The

shareholder filed the claim on behalf of nominal defendant Barclays PLC, alleging that the individual defendants harmed the company

through breaches of their duties, including under the Companies Act 2006. The plaintiff seeks damages on behalf of Barclays PLC for

the losses that Barclays PLC allegedly suffered as a result of these alleged breaches. An amended complaint was filed in April 2021,

which BCI and certain other defendants moved to dismiss. The motion to dismiss was granted in April 2022. The plaintiff appealed the

decision, and the dismissal was unanimously affirmed in June 2023 by the First Judicial Department in New York. The plaintiff has sought

leave to appeal the First Judicial Department’s decision to the New York Court of Appeals.

Derivative transactions civil action

In 2021, Vestia, a Dutch housing association, brought a claim against Barclays Bank PLC in the UK in the High Court in relation to a series

of derivative transactions entered into with Barclays Bank PLC between 2008 and 2011, seeking damages of £329m. Barclays Bank PLC

is defending the claim and has made a counterclaim.

Skilled person review in relation to historic timeshare loans and associated matters

Clydesdale Financial Services Limited (CFS), which trades as Barclays Partner Finance and houses Barclays’ point-of-sale finance

business, was required by the FCA to undertake a skilled person review in 2020 following concerns about historic affordability

assessments for certain loans to customers in connection with timeshare purchases. The skilled person review was concluded in 2021.

CFS complied fully with the skilled person review requirements, including carrying out certain remediation measures. CFS was not

required to conduct a full back book review. Instead, CFS reviewed limited historic lending to ascertain whether its practices caused

customer harm and is remediating any examples of harm. This work was substantially completed during 2023, utilising provisions

booked to account for any remediations.

Motor finance commission arrangements

In January 2024, the FCA announced that it was appointing a skilled person to undertake a review of the historical use of discretionary

commission arrangements and sales in the motor finance market across several firms.  This follows two final decisions by the UK

Financial Ombudsman Service (FOS), including one upholding a complaint against CFS in relation to commission arrangements and

disclosure in the sale of motor finance products and a number of complaints and court claims, including some against CFS.  Barclays will

co-operate fully with the FCA’s skilled person review, the outcome of which is unknown, including any potential financial impact.  The

FCA plans to set out next steps on this matter by the end of September 2024. Barclays ceased operating in the motor finance market in

late 2019.

Over-issuance of securities in the US

In March 2022, executive management became aware that Barclays Bank PLC had issued securities materially in excess of the set

amount under its US shelf registration statements. As a result, Barclays Bank PLC commenced a rescission offer on 1 August 2022, by

which Barclays Bank PLC offered to repurchase relevant affected securities from certain holders, which expired on 12 September 2022.

Further, in September 2022, the SEC announced the resolution of its investigation of Barclays PLC and Barclays Bank PLC relating to

such over-issuance of securities.

In September 2022, a purported class action claim was filed in the US District Court in Manhattan seeking to hold Barclays PLC, Barclays

Bank PLC and former and current executives responsible for declines in the price of Barclays PLC’s American depositary receipts, which

the plaintiffs claim occurred as a result of alleged misstatements and omissions in its public disclosures. The defendants have moved to

dismiss the case. In addition, holders of a series of ETNs have brought claims against Barclays PLC, Barclays Bank PLC, and former and

current executives and board members in the US alleging, among other things, that Barclays’ failure to disclose that these ETNs were

unregistered securities misled investors and that, as a result, Barclays is liable for the holders’ alleged losses following the suspension of

further sales and issuances of such series of ETNs. Two such actions are purported class actions that have been consolidated into a

single action in federal court in New York. Barclays has moved to dismiss the complaint.

Any liabilities, claims or actions in connection with the over-issuance of securities under Barclays Bank PLC’s US shelf registration

statements could have an adverse effect on the Group’s business, financial condition, results of operations and reputation as a

frequent issuer in the securities markets.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Accruals, provisions, contingent liabilities and legal proceedings | | | | | | | | | | |

2. Barclays PLC, Barclays Bank PLC and Barclays Bank UK PLC

HM Revenue & Customs (HMRC) assessments concerning UK Value Added Tax

In 2018, HMRC issued notices that have the effect of either removing certain Barclays overseas subsidiaries that have operations in the

UK from Barclays’ UK VAT group or preventing them from joining it. Supplies between members of a UK VAT group are generally free

from VAT. The notices had both retrospective and prospective effect. Barclays has appealed HMRC’s decisions to the First Tier

Tribunal (Tax Chamber) in relation to both the retrospective VAT assessments and the on-going VAT payments made since 2018.

£181m of VAT (inclusive of interest) was assessed retrospectively by HMRC covering the periods 2014 to 2018, of which approximately

£128m is expected to be attributed to Barclays Bank UK PLC and £53m to Barclays Bank PLC. This retrospectively assessed VAT was

paid in 2018 and an asset, adjusted to reflect expected eventual recovery, is recognised. Since 2018 Barclays has paid, and recognised

as an expense, VAT on intra-group supplies from the relevant subsidiaries to the members of the VAT group.

FCA investigation into transaction monitoring

The FCA has been investigating Barclays’ compliance with UK money laundering regulations and the FCA’s rules and Principles for

Businesses in an enforcement investigation which is focused on aspects of Barclays’ transaction monitoring in relation to certain

business lines now in Barclays Bank UK PLC. The FCA has informed Barclays that it is closing the enforcement investigation into this

matter.

3. Barclays PLC

Civil action in respect of Barclays’ statements regarding the relationship between its former CEO and Jeffrey Epstein

In November 2023, a purported class action was filed in federal court in California against Barclays PLC and a number of current and

former members of the Board of Directors of Barclays PLC. The complaint seeks to hold the defendants responsible for declines in the

price of Barclays PLC’s American depositary receipts, which the plaintiffs claim occurred as a result of alleged misstatements and

omissions in Barclays’ public disclosures relating to its former CEO’s relationship with Jeffrey Epstein.

Alternative trading systems

In 2020, a claim was brought against Barclays PLC in the UK in the High Court by various shareholders regarding Barclays PLC’s share

price based on the allegations contained within a complaint by the New York State Attorney General (NYAG) in 2014. Such claim was

settled in 2016, as previously disclosed. The more recent claim seeks unquantified damages and Barclays is defending the claim. The

NYAG complaint was filed against Barclays PLC and BCI in the NY Supreme Court alleging, among other things, that Barclays PLC and

BCI engaged in fraud and deceptive practices in connection with LX, BCI’s SEC-registered alternative trading system.

General

The Group is engaged in various other legal, competition and regulatory matters in the UK, the US and a number of other overseas

jurisdictions. It is subject to legal proceedings brought by and against the Group which arise in the ordinary course of business from time

to time, including (but not limited to) disputes in relation to contracts, securities, guarantees, debt collection, consumer credit, fraud,

trusts, client assets, competition, data management and protection, intellectual property, money laundering, financial crime,

employment, environmental and other statutory and common law issues.

The Group is also subject to enquiries and examinations, requests for information, audits, investigations and legal and other

proceedings by regulators, governmental and other public bodies in connection with (but not limited to) consumer protection

measures, measures to combat money laundering and financial crime, compliance with legislation and regulation, wholesale trading

activity and other areas of banking and business activities in which the Group is or has been engaged. The Group is cooperating with the

relevant authorities and keeping all relevant agencies briefed as appropriate in relation to these matters and others described in this

note on an ongoing basis.

At the present time, Barclays PLC does not expect the ultimate resolution of any of these other matters to have a material adverse

effect on the Group’s financial position. However, in light of the uncertainties involved in such matters and the matters specifically

described in this note, there can be no assurance that the outcome of a particular matter or matters (including formerly active matters

or those matters arising after the date of this note) will not be material to Barclays PLC’s results, operations or cash flows for a particular

period, depending on, among other things, the amount of the loss resulting from the matter(s) and the amount of profit otherwise

reported for the reporting period.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 474 |
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| Notes to the financial statements (continued) | | | | | | | | | | |
| Accruals, provisions, contingent liabilities and legal proceedings | | | | | | | | | | |

#### Capital instruments, equity and reserves

The notes included in this section focus on the Group’s loan capital and shareholders’ equity including issued share capital, retained

earnings, other equity balances and interests of minority shareholders in our subsidiary entities (non-controlling interests). For more

information on capital management and how the Group maintains sufficient capital to meet our regulatory requirements refer to the

Capital risk management section.

26 Subordinated liabilities

Accounting for subordinated liabilities

Subordinated liabilities are measured at amortised cost using the effective interest method under IFRS 9.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| As at 1 January | 11,423 | 12,759 |
| Issuances | 1,523 | 1,477 |
| Redemptions | (2,239) | (2,679) |
| Other | (213) | (134) |
| As at 31 December | 10,494 | 11,423 |

Issuances of £1,523m comprise £1,180m USD 7.119%  Fixed-to-Floating Rate Subordinated Callable Notes, issued externally by

Barclays PLC, £315m  USD Floating Rate Notes, and £28m JPY Floating Rate Notes issued externally by Barclays subsidiaries.

Redemptions of £2,239m comprise £1,345m EUR 2%  Fixed Rate Subordinated Notes and £599m partial repurchase of USD 4.375%

Fixed Rate Subordinated Notes issued externally by Barclays PLC, £194m USD Floating Rate Notes and £28m JPY Floating Rate Notes

issued externally by Barclays subsidiaries, £43m EUR Subordinated Floating Rate Notes and £30m USD Junior Undated Floating Rate

Notes issued externally by Barclays Bank PLC.

Other movements predominantly comprise foreign exchange movements and fair value hedge adjustments.

Subordinated liabilities include accrued interest and comprise undated and dated subordinated liabilities as follows:

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| Undated subordinated liabilities | — | 28 |
| Dated subordinated liabilities | 10,494 | 11,395 |
| Total subordinated liabilities | 10,494 | 11,423 |

None of the Group’s subordinated liabilities are secured.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Undated subordinated liabilities1 |  |  |  |
|  |  | 2023 | 2022 |
|  | Initial call date | £m | £m |
| Barclays Bank PLC issued |  |  |  |
| Undated Notes |  |  |  |
| Junior Undated Floating Rate Notes (USD 38 m) | Any interest payment date | — | 28 |
| Total undated subordinated liabilities |  | — | 28 |

Note

1 Instrument values are disclosed to the nearest million.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 475 |
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| Notes to the financial statements (continued) | | | | | | | | | | |
| Capital instruments, equity and reserves | | | | | | | | | | |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Dated subordinated liabilities1 |  |  |  |  |
|  |  |  | 2023 | 2022 |
|  | Initial call date | Maturity date | £m | £m |
| Barclays PLC issued |  |  |  |  |
| 2% Fixed Rate Subordinated Callable Notes (EUR  1,500 m) | 2023 | 2028 | — | 1,345 |
| 4.375% Fixed Rate Subordinated Notes (USD  1,250 m) |  | 2024 | 380 | 1,013 |
| 3.75% Fixed Rate Resetting Subordinated Callable Notes (GBP  500m) | 2025 | 2030 | 466 | 445 |
| 3.75% Fixed Rate Resetting Subordinated Callable Notes (SGD  200m) | 2025 | 2030 | 117 | 120 |
| 5.20% Fixed Rate Subordinated Notes (USD  2,050 m) |  | 2026 | 1,529 | 1,588 |
| 1.125% Fixed Rate Resetting Subordinated Callable Notes (EUR  1,000m) | 2026 | 2031 | 817 | 795 |
| 4.836% Fixed Rate Subordinated Callable Notes (USD  2,000 m) | 2027 | 2028 | 1,499 | 1,554 |
| 8.407% Fixed Rate Resetting Subordinated Callable Notes (GBP  1,000m) | 2027 | 2032 | 1,033 | 1,013 |
| 5.088% Fixed-to-Floating Rate Subordinated Callable Notes (USD  1,500 m) | 2029 | 2030 | 1,078 | 1,117 |
| 3.564% Fixed Rate Resetting Subordinated Callable Notes (USD  1,000m) | 2030 | 2035 | 654 | 664 |
| 7.119% Fixed-to-Floating Rate Subordinated Callable Notes (USD 1,500m) | 2033 | 2034 | 1,175 | — |
| 3.811% Fixed Rate Resetting Subordinated Callable Notes (USD  1,000m) | 2041 | 2042 | 623 | 646 |
| Barclays Bank PLC issued |  |  |  |  |
| Subordinated Floating Rate Notes (EUR 50 m) |  | 2023 | — | 44 |
| 5.75% Fixed Rate Subordinated Notes |  | 2026 | 286 | 280 |
| 5.4% Reverse Dual Currency Subordinated Loan (JPY  15,000 m) |  | 2027 | 84 | 93 |
| 6.33% Subordinated Notes |  | 2032 | 45 | 46 |
| Subordinated Floating Rate Notes (EUR 68 m) |  | 2040 | 59 | 60 |
| External issuances by other subsidiaries |  | 2033 | 649 | 572 |
| Total dated subordinated liabilities |  |  | 10,494 | 11,395 |

Note

1 Instrument values are disclosed to the nearest million.

Dated subordinated liabilities

Dated subordinated liabilities are issued by Barclays PLC, Barclays Bank PLC and its subsidiaries for the development and expansion of

their businesses and to strengthen their respective capital bases. The principal terms of the dated subordinated liabilities are described

below:

Subordination

Dated subordinated liabilities issued by Barclays PLC ranks behind the claims against Barclays PLC of unsecured unsubordinated

creditors but before the claims of the holders of its equity.

All dated subordinated liabilities externally issued by Barclays Bank PLC rank behind the claims against Barclays Bank PLC of depositors

and other unsecured unsubordinated creditors but before the claims of the holders of its equity. The dated subordinated liabilities

externally issued by other subsidiaries are similarly subordinated as the external subordinated liabilities issued by Barclays Bank PLC.

Interest

Interest on the Floating Rate Notes is fixed periodically in advance, based on the related market rates.

Interest on Fixed Rate Notes is set by reference to market rates at the time of issuance and fixed until maturity.

Interest on the 4.836% USD Fixed Rate Subordinated Callable Notes, 3.75% SGD Fixed Rate Resetting Subordinated Callable Notes,

3.75% GBP Fixed Rate Resetting Subordinated Callable Notes, 3.811% USD  Fixed Rate Resetting Subordinated Callable notes, 1.125%

EUR Fixed Rate Resetting Subordinated Callable Notes, 3.564% USD Fixed Rate Resetting Subordinated Callable Notes, and the

8.407% GBP Fixed Rate Resetting Subordinated Callable Notes  are fixed until the call date. After the respective call dates, in the event

that they are not redeemed, the interest rates will be reset and fixed until maturity based on a market rate. Interest on the 5.088%  USD

Fixed-to-Floating Rate Subordinated Callable Notes and 7.119% USD  Fixed-to-Floating Rate Subordinated Callable Notes are fixed

until the call date. After the call date, in the event that they are not redeemed, the interest rate will reset periodically in advance based

on market rates.

Repayment

Those subordinated liabilities with a call date are repayable at the option of the issuer on such call date in accordance with the

conditions governing the respective debt obligations, some in whole or in part, and some only in whole. The remaining dated

subordinated liabilities outstanding at 31 December 2023 are redeemable only on maturity, subject in particular cases to provisions

allowing an early redemption in the event of certain changes in tax law, or to certain changes in legislation or regulations.

Any repayments prior to maturity require, in the case of Barclays PLC and Barclays Bank PLC, the prior consent of the PRA, or in the

case of the overseas issues, the approval of the local regulator for that jurisdiction and of the PRA in certain circumstances.

There are no committed facilities in existence at the balance sheet date which permit the refinancing of debt beyond the date of

maturity.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 476 |
|  |  |
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| Notes to the financial statements (continued) | | | | | | | | | | |
| Capital instruments, equity and reserves | | | | | | | | | | |

27 Ordinary shares, share premium, and other equity

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Called up share capital, allotted and fully paid |  |  |  |  |  |
|  | Number of shares | Ordinary share  capital | Ordinary share  premium | Total share capital  and share premium | Other  equity instruments |
|  | m | £m | £m | £m | £m |
| As at 1 January 2023 | 15,871 | 3,968 | 405 | 4,373 | 13,284 |
| Issued to staff under share incentive plans | 121 | 30 | 94 | 124 | — |
| AT1 securities issuance | — | — | — | — | 3,140 |
| AT1 securities redemption | — | — | — | — | (3,170) |
| Repurchase of shares | (837) | (209) | — | (209) | — |
| Other movements | — | — | — | — | 5 |
| As at 31 December 2023 | 15,155 | 3,789 | 499 | 4,288 | 13,259 |
|  |  |  |  |  |  |
| As at 1 January 2022 | 16,752 | 4,188 | 348 | 4,536 | 12,259 |
| Issued to staff under share incentive plans | 50 | 13 | 57 | 70 | — |
| AT1 securities issuance | — | — | — | — | 3,158 |
| AT1 securities redemption | — | — | — | — | (2,126) |
| Repurchase of shares | (931) | (233) | — | (233) | — |
| Other movements | — | — | — | — | (7) |
| As at 31 December 2022 | 15,871 | 3,968 | 405 | 4,373 | 13,284 |

Called up share capital

Called up share capital comprises  15,155m ( 2022: 15,871m ) ordinary shares of  25 p each.

Share repurchase

At the 2023  AGM on 3  May 2023, Barclays PLC was authorised to repurchase up to an aggregate of 1,587m  of its ordinary shares of

25 p. The authorisation is effective until the AGM in 2024  or the close of business on 30 June 2024, whichever is the earlier. During  2023,

837m shares were repurchased with a total nominal value of  £209m (2022 : 931m shares with a nominal value of £233m).

Other equity instruments

Other equity instruments of £13,259m ( 2022: £13,284m ) include AT1 securities issued by Barclays PLC. The AT1 securities are

perpetual securities with no fixed maturity and are structured to qualify as AT1 instruments under prevailing capital rules applicable as at

the relevant issue date.

In 2023 , there were three   issuances of AT1 instruments, in the form of Fixed Rate Resetting Perpetual Subordinated Contingent

Convertible Securities, for £3,140m  (2022: three  issuances for £3,158m) which includes issuance costs of £10m (2022: £9m). There

were two  redemptions in  2023 totalling £3,170m (2022: two redemptions totalling £2,126m).

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| AT1 equity instruments |  |  |  |
|  |  | 2023 | 2022 |
|  | Initial call date | £m | £m |
| AT1 equity instruments - Barclays PLC |  |  |  |
| 7.25% Perpetual Subordinated Contingent Convertible Securities 1 | 2023 | — | 1,243 |
| 7.75% Perpetual Subordinated Contingent Convertible Securities (USD  2,500m) | 2023 | — | 1,925 |
| 5.875% Perpetual Subordinated Contingent Convertible Securities 1 | 2024 | 1,241 | 1,244 |
| 8% Perpetual Subordinated Contingent Convertible Securities (USD  2,000m) | 2024 | 1,509 | 1,509 |
| 7.125% Perpetual Subordinated Contingent Convertible Securities 1 | 2025 | 996 | 993 |
| 6.375% Perpetual Subordinated Contingent Convertible Securities | 2025 | 996 | 996 |
| 6.125% Perpetual Subordinated Contingent Convertible Securities (USD  1,500m) | 2025 | 1,142 | 1,142 |
| 8.300% Perpetual Subordinated Contingent Convertible Securities (SGD  450m) | 2027 | 264 | 264 |
| 8.875% Perpetual Subordinated Contingent Convertible Securities | 2027 | 1,247 | 1,247 |
| 4.375% Perpetual Subordinated Contingent Convertible Securities (USD  1,500m) 1 | 2028 | 1,077 | 1,078 |
| 9.250% Perpetual Subordinated Contingent Convertible Securities | 2028 | 1,497 | — |
| 7.300% Perpetual Subordinated Contingent Convertible Securities (SGD  400m) | 2028 | 248 | — |
| 8.000% Perpetual Subordinated Contingent Convertible Securities (USD  2,000m) 1 | 2029 | 1,647 | 1,643 |
| 9.625%  Perpetual Subordinated Contingent Convertible Securities (USD  1,750m) | 2029 | 1,395 | — |
| Total AT1 equity instruments |  | 13,259 | 13,284 |

Note

1 Reported net of securities held by the Group.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 477 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Capital instruments, equity and reserves | | | | | | | | | | |

The principal terms of the AT1 securities are described below:

▪ AT1 securities rank behind the claims against Barclays PLC of i ) unsubordinated creditors; ii) claims which are expressed to be

subordinated to the claims of unsubordinated creditors of Barclays PLC but not further or otherwise; or iii) claims which are, or are

expressed to be, junior to the claims of other creditors of Barclays PLC, whether subordinated or unsubordinated, other than claims

which rank, or are expressed to rank, pari passu with, or junior to, the claims of holders of the AT1 securities.

▪ AT1 securities are undated and are redeemable, at the option of Barclays PLC, in whole on (i) the initial reset date, or on any fifth

anniversary after the initial reset date or (ii) any day falling in a named period ending on the initial reset date, or on any fifth anniversary

after the initial reset date. In addition, the AT1  securities are redeemable, at the option of Barclays PLC, in whole in the event of

certain changes in the tax or regulatory treatment of the securities. Any redemptions require the prior consent of the PRA.

▪ Interest on the AT1 securities will be due and payable only at the sole discretion of Barclays PLC, and Barclays PLC has sole and

absolute discretion at all times and for any reason to cancel (in whole or in part) any interest payment that would otherwise be payable

on any interest payment date.

28 Reserves

Currency translation reserve

The currency translation reserve represents the cumulative gains and losses on the retranslation of the Group’s net investment in

foreign operations, net of the effects of hedging.

Fair value through other comprehensive income reserve

The fair value through other comprehensive income reserve represents the changes in the fair value of financial instruments accounted

for at fair value through other comprehensive income investments since initial recognition.

Cash flow hedging reserve

The cash flow hedging reserve represents the cumulative gains and losses on effective cash flow hedging instruments that will be

recycled to profit or loss when the hedged transactions affect profit or loss.

Own credit reserve

The own credit reserve reflects the cumulative own credit gains and losses on financial liabilities at fair value. Amounts in the own credit

reserve are not recycled to profit or loss in future periods.

Other reserves and treasury shares

Other reserves relate to redeemed ordinary and preference shares issued by the Group.

Treasury shares relate to Barclays PLC shares held in relation to the Group’s various share schemes. These schemes are described in

Note 31. Treasury shares are deducted from shareholders’ equity within other reserves. A transfer is made to retained earnings in line

with the vesting of treasury shares held for the purposes of share-based payments.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| Currency translation reserve | 3,671 | 4,772 |
| Fair value through other comprehensive income reserve | (1,366) | (1,560) |
| Cash flow hedging reserve | (3,707) | (7,235) |
| Own credit reserve | (240) | 467 |
| Other reserves and treasury shares | 1,565 | 1,364 |
| Total | (77) | (2,192) |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 478 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Capital instruments, equity and reserves | | | | | | | | | | |

29 Non-controlling interests

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | Profit attributable to non-controlling  interest | | Equity attributable to non-controlling  interest | | Dividends paid to non-controlling  interest | |
|  | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
|  | £m | £m | £m | £m | £m | £m |
| Barclays Bank PLC issued: |  |  |  |  |  |  |
| – Preference shares | 40 | 31 | 529 | 529 | 40 | 31 |
| – Upper Tier 2 instruments | 24 | 14 | 126 | 438 | 24 | 14 |
| Other non-controlling interests | — | — | 5 | 1 | — | — |
| Total | 64 | 45 | 660 | 968 | 64 | 45 |

In  2023, there were  no  issuances ( 2022 :  none ) and three  redemptions of £312m  ( 2022 :  £20m ) relating to the Undated Floating Rate

Primary Capital Notes Series 1  (£93m) and Series 2 (£179m) and 9% Permanent Interest Bearing Capital Bonds (£40m)

Barclays Bank PLC and protective rights of non-controlling interests

Barclays PLC holds  100% of the voting rights of Barclays Bank PLC. As at  31 December 2023, Barclays Bank PLC has in issue preference

shares and  Upper Tier 2 instruments. These are non-controlling interests to the Group.

A fixed coupon rate is attached to all Upper Tier 2 instruments until the initial call date.

After the initial call date, in the event they are not redeemed, coupon payments in relation to the  6.125% Undated Notes are fixed

periodically in advance for five-year periods based on market rates. Coupon payments for all other Upper Tier 2 instruments are at rates

fixed periodically in advance based on market rates.

The payment of preference share dividends and Upper Tier 2 coupons are typically at the discretion of Barclays Bank PLC, except for

coupon payments that become compulsory where Barclays PLC has declared or paid a dividend on ordinary shares, or in certain cases,

any class of preference shares, in the preceding six-month period.  Coupons not paid become payable in each case if such a dividend is

subsequently paid or in certain other circumstances. No dividend or coupon payments may be made unless Barclays Bank PLC satisfies

a specified solvency test. Under the terms of these instruments, Barclays PLC may not pay dividends on ordinary shares until a dividend

or coupon is next paid on these instruments or the instruments are redeemed or purchased by Barclays Bank PLC. There are no

restrictions on Barclays Bank PLC’s ability to remit capital to the Parent as a result of these issued instruments.

Preference share redemptions are typically at the discretion of Barclays Bank PLC and are redeemable in whole, but not in part, at the

initial call date and on any dividend payment date after the initial call date, pursuant to their respective terms. Upper Tier 2 instruments

are repayable, at the option of Barclays Bank PLC in whole at the initial call date and on any fifth anniversary after the initial call date. In

addition, each issue of Upper Tier 2 instruments is repayable, at the option of Barclays Bank PLC, in whole for certain tax reasons, either

at any time, or on an interest payment date. There are no events of default except non-payment of principal or mandatory interest. Any

repayments or redemptions require the prior consent of the PRA, and in respect of the preference shares, any such redemption will be

subject to the Companies Act 2006 and the Articles of Barclays Bank PLC.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
| Instrument | £m | £m |
| Preference Shares: |  |  |
| US Dollar Preference Shares | 318 | 318 |
| Euro Preference Shares | 211 | 211 |
| Total Barclays Bank PLC Preference Shares | 529 | 529 |
|  |  |  |
| Upper Tier 2 Instruments: |  |  |
| Undated Floating Rate Primary Capital Notes Series 1 | — | 93 |
| Undated Floating Rate Primary Capital Notes Series 2 | — | 179 |
| 5.03% Undated Reverse Dual Currency Subordinated Loan (JPY 8 bn) | 39 | 39 |
| 5.0% Reverse Dual Currency Undated Subordinated Loan (JPY 12 bn) | 53 | 53 |
| 9% Permanent Interest Bearing Capital Bonds (£ 100 m) | — | 40 |
| 6.125% Undated Subordinated Notes (£ 550 m) | 34 | 34 |
| Total Upper Tier 2 Instruments | 126 | 438 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 479 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Capital instruments, equity and reserves | | | | | | | | | | |

#### Employee benefits

The notes included in this section focus on the costs and commitments associated with employing our staff.

30  Staff costs

Accounting for staff costs

Deferred cash and share awards are made to employees to incentivise performance over the period employees provide services. To

receive payment under an award, employees must provide service over the vesting period. The period over which the expense for

deferred cash and share awards is recognised is based upon the period employees consider their services contribute to the awards. For

past awards, the Group considers that it is appropriate to recognise the awards over the period from the date of grant to the date that

the awards vest. In relation to awards granted from 2017, the Group, taking into account the changing employee understanding

surrounding those awards, considered it appropriate for expense to be recognised over the vesting period including the financial year

prior to the grant date.

The accounting policies for share-based payments, and pensions and other post-retirement benefits are included in Note 31 and Note

32 respectively.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Incentive awards granted: |  |  |  |
| Current year bonus | 1,202 | 1,241 | 1,278 |
| Deferred bonus | 543 | 549 | 667 |
| Total incentive awards granted | 1,745 | 1,790 | 1,945 |
|  |  |  |  |
| Reconciliation of incentive awards granted to income statement charge: |  |  |  |
| Less: deferred bonuses granted but not charged in current year | (384) | (388) | (457) |
| Add: current year charges for deferred bonuses from previous years | 390 | 399 | 280 |
| Other differences between incentive awards granted and income statement charge | (1) | 35 | (23) |
| Income statement charge for performance costs | 1,750 | 1,836 | 1,745 |
|  |  |  |  |
| Other income statement charges: |  |  |  |
| Salaries | 5,120 | 4,732 | 4,290 |
| Social security costs | 755 | 714 | 619 |
| Post-retirement benefits1 | 539 | 563 | 539 |
| Other compensation costs | 555 | 504 | 431 |
| Total compensation costs2 | 8,719 | 8,349 | 7,624 |
|  |  |  |  |
| Other resourcing costs: |  |  |  |
| Outsourcing | 601 | 607 | 357 |
| Redundancy and restructuring3 | 452 | (7) | 296 |
| Temporary staff costs | 91 | 113 | 109 |
| Other | 154 | 190 | 125 |
| Total other resourcing costs | 1,298 | 903 | 887 |
|  |  |  |  |
| Total staff costs | 10,017 | 9,252 | 8,511 |

Notes

1 Post-retirement benefits charge includes £371m (2022: £313m; 2021 : £289m) in respect of defined contribution schemes and £168m (2022: £250m;  2021: £250m) in respect of

defined benefit schemes.

2 £860m (2022: £604m; 2021: £484m) of Group compensation cost was capitalised as internally generated software and  excluded from the Staff cost disclosed above .

3   Redundancy and restructuring cost included  £340m relating to structural cost actions taken in Q4 2023.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 480 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Employee benefits | | | | | | | | | | |

31 Share-based payments

Accounting for share-based payments

Employee incentives include awards in the form of shares and share options, as well as offering employees the opportunity to purchase

shares on favourable terms. The cost of the employee services received in respect of the shares or share options granted is recognised

in the income statement over the period that employees provide services. The overall cost of the award is calculated using the number

of shares and options expected to vest and the fair value of the shares or options at the date of grant.

The number of shares and options expected to vest takes into account the likelihood that performance and service conditions included

in the terms of the awards will be met. For other share-based payment schemes such as Sharesave and Sharepurchase, there are non-

vesting conditions which must be met. Failure to meet the non-vesting condition is treated as a cancellation, resulting in an acceleration

of recognition of the cost of the employee services.

The fair value of shares is the market price ruling on the grant date, in some cases adjusted to reflect restrictions on transferability. The

fair value of options granted is determined using the Black Scholes model to estimate the numbers of shares likely to vest. The model

takes into account the exercise price of the option, the current share price, the risk-free interest rate, the expected volatility of the

share price over the life of the option and other relevant factors. Market conditions that must be met in order for the award to vest are

also reflected in the fair value of the award, as are any other non-vesting conditions – such as continuing to make payments into a

share-based savings scheme.

The charge for the year arising from share-based payment schemes was as follows:

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | Charge for the year | | |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Deferred Share Value Plan and Share Value Plan | 284 | 295 | 256 |
| Others | 191 | 214 | 216 |
| Total equity settled | 475 | 509 | 472 |
| Cash settled | 4 | 4 | 5 |
| Total share-based payments | 479 | 513 | 477 |

The terms of the main current plans are as follows:

Share Value Plan (SVP)

SVP awards have been granted to participants in the form of a conditional right to receive Barclays PLC shares or provisional allocations

of Barclays PLC shares which vest or are considered for release over a period of three, four, five or seven years. Participants do not pay

to receive an award or to receive a release of shares. For awards granted before December 2017, the grantor may also make a dividend

equivalent payment to participants on release of a SVP award. SVP awards are also made to eligible employees for recruitment

purposes. All awards are subject to potential forfeiture in certain leaver scenarios.

Deferred Share Value Plan (DSVP)

The terms of the DSVP are materially the same as the terms of the SVP as described above, save that Executive Directors are not

eligible to participate in the DSVP and the DSVP operates over market purchase shares only.

Other schemes

In addition to the SVP and DSVP, the Barclays PLC Group operates a number of other schemes settled in Barclays PLC Shares including

Sharesave (both UK and Ireland), Sharepurchase (both UK and overseas), and the Barclays PLC Group Long Term Incentive Plan. A

delivery of upfront shares to ‘Material Risk Takers’ can be made as a Share Incentive Award (Holding Period) under the SVP.

Share option and award plans

The weighted average fair value per award granted, weighted average share price at the date of exercise/release of shares during the

year, weighted average contractual remaining life and number of options and awards outstanding (including those exercisable) at the

balance sheet date were as follows:

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  | 2023 | | | | 2022 | | | |
|  | Weighted  average fair  value per  award  granted in  year | Weighted  average  share price at  exercise/  release  during year | Weighted  average  remaining  contractual  life | Number of  options/  awards  outstanding | Weighted  average fair  value per  award  granted in  year | Weighted  average  share price at  exercise/  release  during year | Weighted  average  remaining  contractual  life | Number of  options/  awards  outstanding |
|  | £ | £ | in years | (000s) | £ | £ | in years | (000s) |
| DSVP and SVP1,2 | 1.49 | 1.68 | 1 | 495,724 | 1.43 | 1.61 | 1 | 501,454 |
| Others1 | 0.31- 1.69 | 1.43- 1.69 | 0- 3 | 288,755 | 0.38- 1.64 | 1.59- 1.66 | 0- 3 | 316,534 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 481 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Employee benefits | | | | | | | | | | |

SVP and DSVP are nil cost awards on which the performance conditions are substantially completed at the date of grant. Consequently,

the fair value of these awards is based on the market value at that date.

Sharesave has a contractual life of 3 years and 5 years, the expected volatility is 34.10% for 3 years and 33.12% for 5 years. The risk free

interest rates used for valuations are 4.60% and 4.36% for 3 years and 5 years respectively. The pure dividend yield rates used for

valuations are 5.27% and 5.02% for 3 years and 5 years respectively. The repo rates used for valuations are (0.50)% and (0.57)% for

3 years and 5 years respectively. The inputs into the model such as risk free interest rate, expected volatility, pure dividend yield rates

and repo rates are derived from market data.

Movements in options and awards

The movement in the number of options and awards for the major schemes and the weighted average exercise price of options was:

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | DSVP and SVP1,2 | | Others1,3 | | | |
|  | Number (000s) | | Number (000s) | | Weighted average ex. price (£) | |
|  | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
| Outstanding at beginning of year/acquisition date | 501,454 | 413,859 | 316,534 | 335,976 | 0.97 | 0.95 |
| Granted in the year | 232,479 | 291,876 | 198,386 | 146,203 | 1.17 | 1.33 |
| Exercised/released in the year | (196,900) | (178,634) | (193,669) | (133,682) | 0.88 | 1.15 |
| Less: forfeited in the year | (41,309) | (25,647) | (29,424) | (28,789) | 1.20 | 1.01 |
| Less: expired in the year | — | — | (3,072) | (3,174) | 1.42 | 1.23 |
| Outstanding at end of year | 495,724 | 501,454 | 288,755 | 316,534 | 1.06 | 0.97 |
| Of which exercisable: | — | — | 67,967 | 34,247 | 0.87 | 1.19 |

Notes

1 Options/award granted over Barclays PLC shares.

2 Weighted average exercise price is not applicable for SVP and DSVP awards as these are not share option schemes.

3 The number of awards within Others at the end of the year principally relates to Sharesave (number of awards exercisable at end of year was 44,109,518). The weighted average

exercise price relates to Sharesave.

Awards and options granted under the Group’s share plans may be satisfied using new issue shares, treasury shares and market

purchase shares. Awards granted under the DSVP may be satisfied using market purchase shares only.

There were no significant modifications to the share-based payments arrangements in 2023 and 2022 .

As at 31 December 2023, the total liability arising from cash-settled share-based payments transactions was £5m ( 2022: £5m).

Holdings of Barclays PLC shares and hedges

Various employee benefit trusts established by the Group hold shares in Barclays PLC to meet obligations under the Barclays share-

based payment schemes. The total number of Barclays shares held in these employee benefit trusts at 31 December 2023 was 19m

(2022: 14m). Dividend rights have been waived on all these shares. The total market value of the shares held in trust based on the year

end share price of £1.54 (2022: £1.59) was £29m (2022: £22m). For accounting of treasury shares, see Note 28.

The Group has entered into physically settled forward contracts to hedge the settlement of certain share-based payment schemes.

The fixed forward price to be paid under these contracts is £481m and has been recorded in retained earnings.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 482 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Employee benefits | | | | | | | | | | |

32 Pensions and post-retirement benefits

Accounting for pensions and post-retirement benefits

The Group operates a number of pension schemes and post-employment benefit schemes.

Defined contribution schemes –  the Group recognises contributions due in respect of the accounting period in the income statement.

Any contributions unpaid at the balance sheet date are included as a liability.

Defined benefit schemes – the Group recognises its obligations to members of each scheme at the period end, less the fair value of the

scheme assets after applying the asset ceiling test.

Each scheme’s obligations are calculated using the projected unit credit method. Scheme assets are stated at fair value as at the period

end.

Changes in pension scheme liabilities or assets (remeasurements) that do not arise from regular pension cost, net interest on net

defined benefit liabilities or assets, past service costs, settlements or contributions to the scheme, are recognised in other

comprehensive income. Remeasurements comprise experience adjustments (differences between previous actuarial assumptions

and what has actually occurred), the effects of changes in actuarial assumptions, return on scheme assets (excluding amounts included

in the interest on the assets) and any changes in the effect of the asset ceiling restriction (excluding amounts included in the interest on

the restriction).

Post-employment benefit schemes – the cost of providing healthcare benefits to retired employees is accrued as a liability in the financial

statements over the period that the employees provide services to the Group, using a methodology similar to that for defined benefit

pension schemes.

Pension schemes

UK Retirement Fund (UKRF)

The UKRF is the Group’s main scheme, representing 96% (2022: 96%) of the Group’s total retirement benefit obligations. Barclays Bank

PLC is the principal employer of the UKRF. The UKRF was closed to new entrants on 1 October 2012, and comprises 10 sections, the

two most significant of which are:

▪ Afterwork, which comprises a contributory cash balance defined benefit element, and a voluntary defined contribution element. The

cash balance element is accrued each year and revalued until Normal Retirement Age in line with the increase in Retail Price Index

(RPI) (up to a maximum of 5% p.a.). The main risks that Barclays runs in relation to Afterwork are limited although additional

contributions are required if pre-retirement investment returns are not sufficient to provide for the benefits.

▪ The 1964 Pension Scheme. Most employees recruited before July 1997 built up benefits in this non-contributory defined benefit

scheme in respect of service up to 31 March 2010. Pensions were calculated by reference to service and pensionable salary. From

1 April 2010, members became eligible to accrue future service benefits in either Afterwork or the Pension Investment Plan, a historic

defined contribution section which is now closed to future contributions. The risks that Barclays runs in relation to the 1964 section

are typical of final salary pension schemes, principally that investment returns fall short of expectations, that inflation exceeds

expectations, and that retirees live longer than expected.

Barclays Pension Savings Plan (BPSP)

The BPSP is a defined contribution scheme providing benefits for all new UK hires from 1 October 2012. BPSP is not subject to the

same investment return, inflation or life expectancy risks for Barclays that defined benefit schemes are. Members’ benefits reflect

contributions paid and the level of investment returns achieved.

Other

Apart from the UKRF and the BPSP, Barclays operates a number of smaller pension and long-term employee benefits and post-

retirement healthcare plans globally, the largest of which are the US defined benefit and defined contribution schemes. Many of the

schemes are funded, with assets backing the obligations held in separate legal vehicles such as trusts. Others are operated on an

unfunded basis. The benefits provided, the approach to funding, and the legal basis of the schemes, reflect local environments.

Governance

The UKRF operates under trust law and is managed and administered on behalf of the members in accordance with the terms of the

Trust Deed and Rules and all relevant legislation. The Corporate Trustee is Barclays Pension Funds Trustees Limited, a private limited

company and a wholly owned subsidiary of Barclays Bank PLC. The Trustee is the legal owner of the assets of the UKRF which are held

separately from the assets of the Group.

The Trustee Board comprises six Management Directors selected by Barclays, of whom three are independent Directors with no

relationship with Barclays (and who are not members of the UKRF), plus three Member Nominated Directors selected from eligible

active, deferred or pensioner members who apply for the role.

The BPSP is a Group Personal Pension arrangement which operates as a collection of personal pension plans. Each personal pension

plan is a direct contract between the employee and the BPSP provider (Legal & General Assurance Society Limited), and is regulated by

the FCA.

Similar principles of pension governance apply to the Group’s other pension schemes, depending on local legislation.

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|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Employee benefits | | | | | | | | | | |

Amounts recognised

The following tables include amounts recognised in the income statement and an analysis of benefit obligations and scheme assets for

all Group defined benefit schemes. The net position is reconciled to the assets and liabilities recognised on the balance sheet. The

tables include funded and unfunded post-retirement benefits. The income statement charge with respect to Defined contribution

schemes is disclosed as part of footnotes to Note 30 Staff costs.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Income statement (credit)/charge |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Current service cost | 165 | 227 | 247 |
| Net finance (income)/cost | (222) | (122) | (26) |
| Past service cost | — | 20 | — |
| Other movements | 3 | 3 | 3 |
| Total | (54) | 128 | 224 |

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
| Balance sheet reconciliation |  |  |  | |
|  | 2023 | | 2022 | |
|  | Total | Of which relates to  UKRF | Total | Of which relates to  UKRF |
|  | £m | £m | £m | £m |
| Benefit obligation at beginning of the year | (20,881) | (19,990) | (31,899) | (30,859) |
| Current service cost | (165) | (141) | (227) | (197) |
| Interest costs on scheme liabilities | (959) | (929) | (724) | (707) |
| Past service cost | — | — | (20) | (20) |
| Remeasurement (loss)/gain – financial | (708) | (683) | 10,995 | 10,734 |
| Remeasurement (loss)/gain – demographic | 311 | 310 | 268 | 270 |
| Remeasurement (loss)/gain – experience | (264) | (260) | (521) | (510) |
| Employee contributions | (5) | (1) | (4) | — |
| Benefits paid | 1,115 | 1,075 | 1,339 | 1,299 |
| Exchange and other movements | 43 | 1 | (88) | — |
| Benefit obligation at end of the year | (21,513) | (20,618) | (20,881) | (19,990) |
| Fair value of scheme assets at beginning of the year | 25,360 | 24,680 | 35,467 | 34,678 |
| Interest income on scheme assets | 1,181 | 1,155 | 846 | 829 |
| Employer contribution | 54 | 39 | 1,808 | 1,785 |
| Remeasurement – return on scheme assets (less)/greater than discount rate | (532) | (548) | (11,510) | (11,313) |
| Employee contributions | 5 | 1 | 4 | — |
| Benefits paid | (1,115) | (1,075) | (1,339) | (1,299) |
| Exchange and other movements | (39) | (18) | 84 | — |
| Fair value of scheme assets at end of the year | 24,914 | 24,234 | 25,360 | 24,680 |
| Net surplus | 3,401 | 3,616 | 4,479 | 4,690 |
| Retirement benefit assets | 3,667 | 3,616 | 4,743 | 4,690 |
| Retirement benefit liabilities | (266) | — | (264) | — |
| Net retirement benefit assets | 3,401 | 3,616 | 4,479 | 4,690 |

Included within the benefit obligation is £694m (2022: £690m) relating to overseas pensions and £201m (2022: £201m) relating to other

post-employment benefits.

As at 31 December 2023, the UKRF’s scheme assets were in surplus versus IAS 19 obligations by £3,616m (2022: £4,690m). The

decrease in the UKRF surplus during the year was driven by lower corporate bond yields and the assets underperforming the discount

rate.

The weighted average duration of the benefit payments reflected in the defined benefit obligation for the UKRF is 12 years ( 2022: 13

years). The UKRF expected benefits promised to date are projected to be paid out for in excess of 50 years , although 30% of the

benefits are expected to be paid in the next 10 years; 35% in years 11 to 20 and 20% in years 21 to 30. The remainder of the benefits are

expected to be paid beyond 30 years.

Of the £1,075m (2022: £1,299m) UKRF benefits paid out, £122m (2022: £390m) related to transfers out of the fund.

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|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Employee benefits | | | | | | | | | | |

Where a scheme’s assets exceed its obligation, an asset is recognised to the extent that it does not exceed the present value of future

contribution holidays or refunds of contributions (the asset ceiling). In the case of the UKRF the asset ceiling is not applied as, in certain

specified circumstances such as wind-up, the Group expects to be able to recover any surplus. Similarly, a liability in respect of future

minimum funding requirements is not recognised. The Trustee does not have a substantive right to augment benefits, nor do they have

the right to wind up the plan except in the dissolution of the Group or termination of contributions by the Group. The application of the

asset ceiling to other plans and recognition of additional liabilities in respect of future minimum funding requirements are considered on

an individual plan basis.

Critical accounting estimates and judgements

Actuarial valuation of the scheme's obligation is dependent upon a series of assumptions. Below is a summary of the main financial and

demographic assumptions adopted for the UKRF.

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
| Key UKRF financial assumptions | % p.a. | % p.a. |
| Discount rate | 4.49 | 4.80 |
| Inflation rate (RPI) | 3.17 | 3.21 |

The UKRF discount rate assumption for 2023 was based on a standard WTW RATE Link model. The RPI inflation assumption for 2023

was set by reference to the Bank of England’s implied inflation curve. The inflation assumption incorporates a deduction of 20 basis

points as an allowance for an inflation risk premium. The methodology used to derive the discount rate and inflation assumptions is

consistent with that used at the prior year end.

The UKRF’s post-retirement mortality assumptions are based on best estimates derived from an analysis in 2022 of the UKRF’s own

post-retirement mortality experience and taking account of recent evidence from published mortality surveys. An allowance has been

made for future mortality improvements based on the 2022 core projection model published by the Continuous Mortality Investigation

Bureau subject to a long-term trend of 1.25% per annum in future improvements (2022: 1.25% per annum).  The table below shows

how the assumed life expectancy at 60, for members of the UKRF, has varied over the past three years:

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
| Assumed life expectancy | 2023 | 2022 | 2021 |
| Life expectancy at 60  for current pensioners (years) |  |  |  |
| – Males | 26.5 | 26.8 | 27.3 |
| – Females | 29.3 | 29.5 | 29.6 |
| Life expectancy at 60  for future pensioners currently aged  40  (years) |  |  |  |
| – Males | 28.0 | 28.3 | 29.1 |
| – Females | 30.7 | 31.0 | 31.4 |

Through transactions in 2020 and 2022 approximately  three-quarters of the longevity risk for current pensioners has been reinsured,

and the transactions will provide income to the UKRF if pensions are paid out for longer than expected. The contracts form part of the

UKRF’s investment portfolio.

Sensitivity analysis on actuarial assumptions

The sensitivity analysis has been calculated by valuing the UKRF liabilities using the amended assumptions shown in the table below and

keeping the remaining assumptions the same as disclosed in the table above, except in the case of the inflation sensitivity where other

assumptions that depend on assumed inflation have also been amended correspondingly. The difference between the recalculated

liability figure and that stated in the balance sheet reconciliation table above is the figure shown. The selection of these movements to

illustrate the sensitivity of the defined benefit obligation to key assumptions should not be interpreted as Barclays expressing any

specific view of the probability of such movements happening.

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|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Employee benefits | | | | | | | | | | |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Change in key assumptions |  |  |
|  | 2023 | 2022 |
|  | (Decrease)/  Increase in UKRF  defined benefit  obligation | (Decrease)/  Increase in UKRF  defined benefit  obligation |
|  | £bn | £bn |
| Discount rate |  |  |
| 0.5% p.a. increase | (1.2) | (1.1) |
| 0.25% p.a. increase | (0.6) | (0.6) |
| 0.25% p.a. decrease | 0.6 | 0.6 |
| 0.5% p.a. decrease | 1.3 | 1.2 |
| Assumed RPI |  |  |
| 0.5% p.a. increase | 0.8 | 0.8 |
| 0.25% p.a. increase | 0.4 | 0.4 |
| 0.25% p.a. decrease | (0.4) | (0.4) |
| 0.5% p.a. decrease | (0.8) | (0.8) |
| Life expectancy at 60 |  |  |
| One year increase | 0.6 | 0.6 |
| One year decrease | (0.6) | (0.5) |

Assets

A long-term investment strategy has been set for the UKRF, with its asset allocation comprising a mixture of equities, bonds, property

and other appropriate assets. This recognises that different asset classes are likely to produce different long-term returns and some

asset classes may be more volatile than others. The long-term investment strategy ensures, among other aims, that investments are

adequately diversified.

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|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Employee benefits | | | | | | | | | | |

The value of the assets of the schemes and their percentage in relation to total scheme assets were as follows:

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| Analysis of scheme assets |  |  |  |  |  |  |  |  |
|  | Total | | | | Of which relates to UKRF | | | |
|  | Quoted  £m | Unquoted1  £m | Value  £m | % of total fair  value of  scheme  assets  % | Quoted  £m | Unquoted1  £m | Value  £m | % of total fair  value of  scheme  assets  % |
| As at 31 December 2023 |  |  |  |  |  |  |  |  |
| Equities | 116 | — | 116 | 0.5 | — | — | — | — |
| Private equities | — | 2,259 | 2,259 | 9.1 | — | 2,259 | 2,259 | 9.3 |
| Bonds - fixed government | 1,544 | — | 1,544 | 6.2 | 1,289 | — | 1,289 | 5.3 |
| Bonds - index-linked government | 9,400 | — | 9,400 | 37.7 | 9,383 | — | 9,383 | 38.8 |
| Bonds - corporate and other | 6,014 | 1,237 | 7,251 | 29.1 | 5,818 | 1,237 | 7,055 | 29.1 |
| Property | 17 | 1,197 | 1,214 | 4.9 | — | 1,197 | 1,197 | 4.9 |
| Infrastructure | 814 | 720 | 1,534 | 6.2 | 814 | 720 | 1,534 | 6.3 |
| Hedge funds | 11 | 1,309 | 1,320 | 5.3 | — | 1,309 | 1,309 | 5.4 |
| Derivatives | 25 | (1,584) | (1,559) | (6.3) | 25 | (1,584) | (1,559) | (6.4) |
| Longevity reinsurance contracts | — | (131) | (131) | (0.5) | — | (131) | (131) | (0.5) |
| Cash and liquid assets2 | (1,134) | 3,036 | 1,902 | 7.6 | (1,143) | 3,036 | 1,893 | 7.8 |
| Mixed investment funds | 12 | — | 12 | — | — | — | — | — |
| Other | 5 | 47 | 52 | 0.2 | — | 5 | 5 | — |
| Fair value of scheme assets | 16,824 | 8,090 | 24,914 | 100.0 | 16,186 | 8,048 | 24,234 | 100.0 |
|  |  |  |  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |  |  |  |
| Equities | 113 | — | 113 | 0.5 | — | — | — | — |
| Private equities | — | 2,734 | 2,734 | 10.8 | — | 2,734 | 2,734 | 11.1 |
| Bonds - fixed government | 1,353 | — | 1,353 | 5.3 | 1,098 | — | 1,098 | 4.4 |
| Bonds - index-linked government | 9,847 | — | 9,847 | 38.9 | 9,829 | — | 9,829 | 39.9 |
| Bonds - corporate and other | 5,884 | 1,551 | 7,435 | 29.3 | 5,690 | 1,551 | 7,241 | 29.3 |
| Property | 13 | 1,310 | 1,323 | 5.2 | — | 1,310 | 1,310 | 5.3 |
| Infrastructure | 793 | 790 | 1,583 | 6.2 | 793 | 790 | 1,583 | 6.4 |
| Hedge funds | 11 | 1,362 | 1,373 | 5.4 | — | 1,362 | 1,362 | 5.5 |
| Derivatives | (20) | (1,837) | (1,857) | (7.3) | (20) | (1,837) | (1,857) | (7.5) |
| Longevity reinsurance contract | — | (123) | (123) | (0.5) | — | (123) | (123) | (0.5) |
| Cash and liquid assets2 | (1,776) | 3,286 | 1,510 | 6.0 | (1,789) | 3,286 | 1,497 | 6.1 |
| Mixed investment funds | 11 | — | 11 | — | — | — | — | — |
| Other | 7 | 51 | 58 | 0.2 | — | 6 | 6 | — |
| Fair value of scheme assets | 16,236 | 9,124 | 25,360 | 100.0 | 15,601 | 9,079 | 24,680 | 100.0 |

Notes

1 Valuation of unquoted assets is provided by the underlying managers or qualified independent valuers. The valuation for some of the unquoted assets, in particular private equities, is

based on valuations as at 30 September 2023 adjusted by cash flows, these being the latest available valuations as at the point of publication. All valuations are determined in

accordance with relevant industry guidance. Barclays does not believe these valuations will differ materially from the fair value, in the context of the overall UKRF asset size.

2 Cash and liquid assets for the UKRF consists of £354m (2022: £521m) Cash, £91m (2022: £80m) Receivables/payables, £3,036m (2022:£3,286m)  Pooled cash funds and £(1,588)m

(2022: £(2,390)m)  Repurchase agreements.

Included within the fair value of UKRF scheme assets was nil (2022: nil) relating to shares in Barclays PLC and nil (2022: nil) relating to

bonds issued by Barclays PLC. The UKRF also invests in pooled investment vehicles which may hold shares or debt issued by Barclays

PLC.

During 2023, the Trustee undertook a review of the investment strategy to reflect updated liabilities and market assumptions. The

Trustee agreed to continue their existing de-risking plan and make no fundamental changes to the investment strategy.

At 31 December 2023, 39% of the UKRF assets were invested in liability-driven investment strategies; primarily UK gilts as well as

interest rate and inflation swaps. These swaps are used to better match the assets to its liabilities. The swaps are used to reduce the

scheme’s inflation and duration risks against its liabilities.

The UKRF employs derivative instruments, where appropriate, to match assets more closely to liabilities, or to achieve a desired

exposure or return.  The value of assets shown reflects the assets held by the UKRF, with any derivative holdings reflected on a fair value

basis. The UKRF uses repurchase agreements and reverse repurchase agreements to achieve the Trustee’s liability hedging objective.

Investment managers are allowed to undertake repo transactions on the UKRF’s existing gilt holdings to raise cash with which to buy

additional gilts for efficient portfolio management; and reverse repo transactions to receive gilts and be paid a fee for providing cash.

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|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Employee benefits | | | | | | | | | | |

The UKRF has a comprehensive and robust liquidity framework in place. The aim of the liquidity framework is to ensure that pension

payments and other liquidity outflows are paid in due course, sufficient liquidity and collateral is maintained to achieve strategic

allocation targets and that all liquidity outflows/collateral needs are covered without forced sale or strategic asset allocation changes.

The UKRF holds two longevity reinsurance contracts covering c75% of the current pensioner liabilities. The contracts provide income

to the UKRF if pensions are paid out for longer than expected. At 31 December 2023, the combined value of the contracts was £(131)m

(2022: £(123)m). The negative value reflects the estimated impact of changes in the reinsurance market, demographic assumptions

and risk premia since the contracts were entered into by the UKRF.

For information on the UKRF Trustee’s approach to Responsible Investment and Climate Risk, in the context of managing the UKRF,

please refer to the UKRF Trustee website at http://epa.towerswatson.com/accounts/barclays/public/barclays-bank-responsible-

investment-policy/.

Triennial valuation

The UKRF annual funding update as at 30 September 2023 showed a funding surplus of £2.03bn compared to £1.97bn  at 30

September 2022 triennial actuarial valuation. The improvement was mainly due to asset returns outperforming the change in liabilities.

The main differences between the funding and accounting assumptions are a different approach to setting the discount rate and a

more conservative longevity assumption for funding.

As part of the 2022 triennial valuation, the Trustee and Barclays Bank PLC agreed an annual adequacy test on a basis more prudent than

the IAS 19 or funding bases. Should the UKRF be sufficiently funded on this basis, the regular employer contributions to the UKRF to

fund future Afterwork accrual will not be required in the following calendar year. The test will be reviewed at the 2025 triennial valuation.

The test was passed in September, so no regular employer contributions are required for 2024.

The next funding valuation of the UKRF is due to be completed in 2026 with an effective date of 30 September 2025.

Other support measures agreed which remain in place

Collateral – Barclays Bank PLC has entered into an agreement with the UKRF Trustee to provide collateral to cover at least 100% of any

funding deficit with an overall cap of £9bn, to provide security if the UKRF is in a funding deficit. The collateral pool is currently zero,

reflecting the surplus funding position. The arrangement provides the UKRF Trustee with dedicated access to the pool of assets in the

event of Barclays Bank PLC not paying any required deficit reduction contribution to the UKRF or in the event of Barclays Bank PLC’s

insolvency.

Participation – As permitted under the Financial Services and Markets Act 2000 (Banking Reform) (Pensions) Regulations 2016, Barclays

Bank UK PLC is a participating employer in the UKRF and will remain so during a transitional phase until September 2025 as set out in a

deed of participation. In the event of Barclays Bank PLC’s insolvency during this period provision has been made to require Barclays

Bank UK PLC to become the principal employer of the UKRF. Barclays Bank PLC’s Section 75 debt would be triggered by the insolvency

(the debt would be calculated after allowing for the payment to the UKRF of any collateral above).

Defined benefit contributions paid with respect to the UKRF were as follows:

|  |  |
| --- | --- |
|  |  |
| Contributions paid |  |
|  | £m |
| 2023 | 39 |
| 2022 | 1,785 |
| 2021 | 955 |

There were nil (2022: nil) Section 75 contributions included within the Group’s contributions paid as no participating employers left the

UKRF in 2023.

The Group’s expected contribution to the UKRF in respect of defined benefits in 2024 is £22m. In addition, the expected contributions

to UK defined contribution schemes in 2024 is £32m to the UKRF and £293m to the BPSP.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Employee benefits | | | | | | | | | | |

#### Scope of consolidation

The notes included in this section present information on the Group’s investments in subsidiaries, joint ventures and associates and its

interests in structured entities. Detail is also given on securitisation transactions the Group has entered into and arrangements that are

held off-balance sheet.

33 Principal subsidiaries

The significant judgements used in applying this policy are set out below.

Accounting for investment in subsidiaries

In the individual financial statements of Barclays PLC, investments in subsidiaries are stated at cost less impairment.

Principal subsidiaries for the Group are set out below. This includes those subsidiaries that are most significant in the context of the

Group’s business, results or financial position.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  | Principal place of business or  incorporation |  | Percentage of  voting rights held | Non-controlling  interests -  proportion of  ownership  interests | Non-controlling  interests -  proportion of  voting interests |
| Company name | Nature of business | % | % | % |
| Barclays Bank PLC | United Kingdom | Banking, holding company | 100 | 1 | — |
| Barclays Bank UK PLC | United Kingdom | Banking, holding company | 100 | — | — |
| Barclays Bank Ireland PLC | Ireland | Banking | 100 | — | — |
| Barclays Execution Services  Limited | United Kingdom | Service company | 100 | — | — |
| Barclays Capital Inc. | United States | Securities dealing | 100 | — | — |
| Barclays Capital Securities  Limited | United Kingdom | Securities dealing | 100 | — | — |
| Barclays Securities Japan  Limited | Japan | Securities dealing | 100 | — | — |
| Barclays US LLC | United States | Holding company | 100 | — | — |
| Barclays Bank Delaware | United States | Credit card issuer | 100 | — | — |

The country of registration or incorporation is also the principal area of operation of each of the above subsidiaries.

Ownership interests are in some cases different to voting interests due to the existence of non-voting equity interests, such as

preference shares. Refer to Note 29 for more information.

Determining whether the Group has control of an entity is generally straightforward based on ownership of the majority of the voting

capital. However, in certain instances, this determination will involve judgement, particularly in the case of structured entities where

voting rights are often not the determining factor in decisions over the relevant activities. This judgement will involve assessing the

purpose and design of the entity. It will also often be necessary to consider whether the Group, or another involved party with power

over the relevant activities, is acting as a principal in its own right or as an agent on behalf of others.

There is also often considerable judgement involved in the ongoing assessment of control over structured entities. In this regard, where

market conditions have deteriorated such that the other investors’ exposures to the structure’s variable returns have been

substantively eliminated, the Group may conclude that the managers of the structured entity are acting as its agent and therefore will

consolidate the structured entity.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Scope of consolidation | | | | | | | | | | |

An interest in equity voting rights exceeding 50% would typically indicate that the Group has control of an entity. However, the entity set

out below is excluded from consolidation because the Group does not have exposure to its variable returns.

|  |  |  |  |  |
| --- | --- | --- | --- | --- |
|  |  |  |  |  |
|  |  | Percentage of  voting rights held | Equity  shareholders'  funds | Retained profit for  the year |
| Company name | Country of registration or incorporation | % | £m | £m |
| Palomino Limited | Cayman Islands | 100 | — | — |

This entity is managed by an external counterparty and consequently is not controlled by the Group. Interests relating to this entity are

included in Note 34.

Significant restrictions

As is typical for a group of its size and international scope, there are restrictions on the ability of Barclays PLC to obtain distributions of

capital, access the assets or repay the liabilities of members of its Group due to the statutory, regulatory and contractual requirements

of its subsidiaries and due to the protective rights of non-controlling interests. These are considered below.

Regulatory requirements

Barclays’ principal subsidiary companies have assets and liabilities before intercompany eliminations of  £2,022bn (2022: £1,962bn) and

£1,927bn (2022: £1,869bn) respectively. Certain of these assets and liabilities are subject to prudential regulation and regulatory capital

requirements in the countries in which they are regulated. These require entities to maintain minimum capital levels which cannot be

returned to the parent company, Barclays PLC, on a going concern basis.

In order to meet capital requirements, subsidiaries may issue certain equity-accounted and debt-accounted financial instruments and

non-equity instruments such as Tier 1 and Tier 2 capital instruments and other forms of subordinated liabilities. Refer to Note 26 and

Note 27 for particulars of these instruments. These instruments may be subject to cancellation clauses or preference share

restrictions that would limit the ability of the entity to repatriate the capital on a timely basis.

Liquidity requirements

Regulated subsidiaries of the Group are required to meet applicable PRA or local regulatory requirements pertaining to liquidity. The

regulated subsidiaries include Barclays Bank PLC and Barclays Capital Securities Limited (which are regulated on a combined basis

under a Domestic Liquidity Sub-Group (DoLSub) arrangement), Barclays Bank UK PLC, Barclays Bank Ireland PLC, Barclays Capital Inc.

and Barclays Bank Delaware. Refer to the Liquidity risk section for further details of liquidity requirements, including those of the Group’s

significant subsidiaries.

Statutory requirements

The Group’s subsidiaries are subject to statutory requirements not to make distributions of capital and unrealised profits and generally

to maintain solvency. These requirements restrict the ability of subsidiaries to make remittances of dividends to Barclays PLC, the

ultimate parent, except in the event of a legal capital reduction or liquidation. In most cases, the regulatory restrictions referred to

above exceed the statutory restrictions.

Asset encumbrance

The Group uses its financial assets to raise finance in the form of securitisations and through the liquidity schemes of central banks, as

well as to provide security to the UK Retirement Fund. Once encumbered, the assets are not available for transfer around the Group.

The assets typically affected are disclosed in Note 37.

Other restrictions

The Group is required to maintain balances with central banks and other regulatory authorities, and these amounted to £3,758m (2022:

£3,457m).

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 490 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Scope of consolidation | | | | | | | | | | |

34 Structured entities

A structured entity is an entity in which voting or similar rights are not the dominant factor in deciding who  controls the entity.  Voting

rights may relate to administrative tasks only, with the relevant activities of the entity being directed by means of contractual

arrangements.  Structured entities are generally created to achieve a narrow and well-defined objective with restrictions around their

ongoing activities.

Depending on the Group’s power over the activities of the entity and its exposure to and ability to influence its own returns, it may

consolidate the entity. In other cases, it may sponsor or have exposure to such an entity but not consolidate it.

Consolidated structured entities

The Group has contractual arrangements which may require it to provide financial support to the following types of consolidated

structured entities:

• Securitisation vehicles: The Group uses securitisation as a source of financing and a means of risk transfer.  Where entities are

controlled by the Group, they are consolidated.  Refer to Note 36 for further detail.

▪ Commercial Paper (CP) conduits: These entities issue CP and use the proceeds to lend to clients as part of the Group's multi-seller

conduit programme.  The Group has provided £22.4bn (2022 : £20.8bn) in contractual liquidity facilities to the CP conduits that the

Group consolidates. These amounts represent the maximum the conduits can lend externally. The amounts of CP conduit lending

(drawn and undrawn) to unconsolidated structured entities can be seen in Other interests in unconsolidated structured entities

under multi-seller conduit programme in the  Nature of interest table.

▪ Employee benefit trusts: The Group provides capital contributions to employee benefit trusts to enable them to meet obligations to

employees in relation to share-based remuneration arrangements.

▪ Tender Option Bond (TOB)  trusts: During 2023, the Group provided undrawn liquidity facilities of £3.7bn (2022: £3.8bn) to

consolidated TOB trusts.  These trusts invest in fixed income instruments issued by state, local or other municipalities in the United

States, funded by long-term senior floating-rate notes and junior residual securities.

Unconsolidated structured entities

The term ‘unconsolidated structured entities’ refers to structured entities not controlled by Barclays, and are established either by

Barclays or a third party. An interest in a structured entity is any form of contractual or non-contractual involvement which creates

variability in returns arising from the performance of the entity for the Group. Such interests include holdings of debt or equity

securities, derivatives that transfer financial risks from the entity to the Group, lending, loan commitments, financial guarantees and

investment management agreements.

The Group enters into transactions with unconsolidated structured entities in the normal course of business to facilitate customer

transactions, to provide  risk management services and for specific investment opportunities.  This is predominantly within the CIB

business. Structured entities may take the form of funds, trusts, securitisation vehicles, and private investment companies. The largest

transactions for Barclays include loans and derivatives with hedge fund structures and special purpose entities, multi-seller conduit

lending, holding notes issued by securitisation vehicles, and facilitating customer requirements through funds.

The nature and extent of the Group’s interests in structured entities is summarised below:

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 491 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Scope of consolidation | | | | | | | | | | |

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Summary of interests in unconsolidated structured entities | | | | | |
|  | Secured financing | Short-term traded  interests | Traded derivatives | Other interests | Total |
|  | £m | £m | £m | £m | £m |
| As at 31 December 2023 |  |  |  |  |  |
| Assets |  |  |  |  |  |
| Trading portfolio assets | — | 15,482 | — | — | 15,482 |
| Financial assets at fair value through the income statement | 74,551 | — | — | 1,141 | 75,692 |
| Derivative financial instruments | — | — | 5,685 | — | 5,685 |
| Financial assets at fair value through other comprehensive  income | — | — | — | 838 | 838 |
| Loans and advances at amortised cost | — | — | — | 34,316 | 34,316 |
| Debt securities at amortised cost | — | — | — | 18,487 | 18,487 |
| Reverse repurchase agreements and other similar secured  lending | 896 | — | — | — | 896 |
| Other assets | — | — | — | 130 | 130 |
| Total assets | 75,447 | 15,482 | 5,685 | 54,912 | 151,526 |
| Liabilities |  |  |  |  |  |
| Derivative financial instruments | — | — | 6,173 | — | 6,173 |
|  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |
| Assets |  |  |  |  |  |
| Trading portfolio assets | — | 8,632 | — | — | 8,632 |
| Financial assets at fair value through the income statement | 75,166 | — | — | 2,459 | 77,625 |
| Derivative financial instruments | — | — | 4,555 | — | 4,555 |
| Financial assets at fair value through other comprehensive  income | — | — | — | 423 | 423 |
| Loans and advances at amortised cost | — | — | — | 30,750 | 30,750 |
| Debt securities at amortised cost | — | — | — | 13,542 | 13,542 |
| Reverse repurchase agreements and other similar secured  lending | 117 | — | — | — | 117 |
| Other assets | — | — | — | 69 | 69 |
| Total assets | 75,283 | 8,632 | 4,555 | 47,243 | 135,713 |
| Liabilities |  |  |  |  |  |
| Derivative financial instruments | — | — | 8,460 | — | 8,460 |

Secured financing arrangements, short-term traded interests and traded derivatives are typically managed under Market risk

management policies described in the Market risk management section which includes an indication of the change of risk measures

compared to last year. For this reason, the total assets of these entities are not considered meaningful for the purposes of

understanding the related risks and so have not been presented. Other interests include conduits and lending where the interest is

driven by normal customer demand. As at 31 December 2023, Barclays entered into transactions with approximately 6,000 (2022:

6,000) structured entities.

Secured financing

The Group routinely enters into reverse repurchase contracts, margin lending, stock borrowing and similar arrangements on normal

commercial terms where the counterparty to the arrangement is a structured entity. Due to the nature of these arrangements,

especially the transfer of collateral and ongoing margining, the Group is able to manage its variable exposure to the performance of the

structured entity counterparty. The counterparties included in secured financing mainly include hedge fund limited structures,

investment companies and special purpose entities.

Short-term traded interests

As part of its market making activities, the Group buys and sells interests in structured vehicles, which are predominantly debt securities

issued by asset securitisation vehicles. Such interests are typically held individually or as part of a larger portfolio for no more than 90

days. In such cases, the Group typically has no other involvement with the structured entity other than the securities it holds as part of

trading activities and its maximum exposure to loss is restricted to the carrying value of the asset.

Traded derivatives

The Group enters into a variety of derivative contracts with structured entities which reference market risk variables such as interest

rates, equities, foreign exchange rates and credit indices among other things. The main derivative types which are considered interests

in structured entities include equity options, index-based and entity-specific credit default swaps, and total return swaps.  Interest rate

swaps and foreign exchange derivatives that are not complex and which expose the Group to insignificant credit risk by being senior in

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 492 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Scope of consolidation | | | | | | | | | | |

the payment waterfall of a securitisation and derivatives that are determined to introduce risk or variability to a structured entity are not

considered to be an interest in an entity and have been excluded from the disclosures.

A description of the types of derivatives and the risk management practices are detailed in Note 14. The risk of loss may be mitigated

through ongoing margining requirements as well as a right to cash flows from the structured entity which are senior in the payment

waterfall. Such margining requirements are consistent with market practice for many derivative arrangements and in line with the

Group’s normal credit policies.

Derivative transactions require the counterparty to provide cash or other collateral under margining agreements to mitigate

counterparty credit risk. The Group is mainly exposed to settlement risk on these derivatives which is mitigated through daily margining.

Total notional contract amounts were £335,552m ( 2022: £244,780m).

Except for credit default swaps where the maximum exposure to loss is the swap notional amount, it is not possible to estimate the

maximum exposure to loss in respect of derivative positions as the fair value of derivatives is subject to changes in market rates of

interest, exchange rates and credit indices which by their nature are uncertain. In addition, the Group’s losses would be subject to

mitigating action under its traded market risk and credit risk policies that require the counterparty to provide collateral in cash or other

assets in most cases.

Other interests in unconsolidated structured entities

The Group’s interests in structured entities not held for the purposes of short-term trading activities are set out below, summarised by

the nature of the interest and limited to significant categories, based on maximum exposure to loss.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Nature of interest |  |  |  |  |  |
|  | Multi-seller  conduit  programme | Lending | Other | Total | Of which: Barclays  owned, not  consolidated  entities 1 |
|  | £m | £m | £m | £m | £m |
| As at 31 December 2023 |  |  |  |  |  |
| Financial assets at fair value through the income statement | — | 38 | 1,103 | 1,141 | 907 |
| Financial assets at fair value through other comprehensive  income | — | 638 | 200 | 838 | — |
| Loans and advances at amortised cost | 8,903 | 25,413 | — | 34,316 | — |
| Debt securities at amortised cost | — | — | 18,487 | 18,487 | — |
| Other assets | 38 | 88 | 4 | 130 | — |
| Total on-balance sheet exposures | 8,941 | 26,177 | 19,794 | 54,912 | 907 |
| Total off-balance sheet notional amounts | 11,947 | 12,600 | — | 24,547 | — |
| Maximum exposure to loss | 20,888 | 38,777 | 19,794 | 79,459 | 907 |
| Total assets of the entity | 35,439 | 165,319 | 108,751 | 309,509 | 8,704 |
|  |  |  |  |  |  |
| As at 31 December 2022 |  |  |  |  |  |
| Financial assets at fair value through the income statement | — | 59 | 2,400 | 2,459 | 2,284 |
| Financial assets at fair value through other comprehensive  income | — | 220 | 203 | 423 | — |
| Loans and advances at amortised cost | 8,681 | 22,069 | — | 30,750 | — |
| Debt securities at amortised cost | — | — | 13,542 | 13,542 | — |
| Other assets | 32 | 33 | 4 | 69 | — |
| Total on-balance sheet exposures | 8,713 | 22,381 | 16,149 | 47,243 | 2,284 |
| Total off-balance sheet notional amounts | 10,552 | 10,926 | — | 21,478 | — |
| Maximum exposure to loss | 19,265 | 33,307 | 16,149 | 68,721 | 2,284 |
| Total assets of the entity | 66,504 | 160,002 | 88,779 | 315,285 | 8,690 |

Note

1 Comprises of Barclays owned, not consolidated structured entities per IFRS 10 Consolidated Financial Statements, and Barclays sponsored entities, Refer to Note 33 Principal

subsidiaries for more details on consolidation.

Maximum exposure to loss

Unless specified otherwise below, the Group’s maximum exposure to loss is the total of its on-balance sheet positions and its off-

balance sheet arrangements, being loan commitments and financial guarantees. Exposure to loss is mitigated through collateral,

financial guarantees, the availability of netting and credit protection held.

Multi-seller conduit programme

Barclays' multi-seller conduit programme engages in providing financing to various clients and holds whole or partial interests in pools of

receivables or similar obligations. These instruments are protected from loss through over-collateralisation, seller guarantees, or other

credit enhancements provided to the conduit entities. The Group’s off-balance sheet exposure included in the table above represents

liquidity facilities that are provided to the conduit for the benefit of the holders of the commercial paper issued by the conduit and will

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 493 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Scope of consolidation | | | | | | | | | | |

only be drawn where the conduit is unable to access the commercial paper market. If these liquidity facilities are drawn, the Group is

protected from loss through over-collateralisation, seller guarantees, or other credit enhancements provided to the conduit.

Lending

The portfolio includes lending provided by the Group to unconsolidated structured entities in the normal course of its lending business

to earn income in the form of interest and lending fees and includes loans to structured entities that are generally collateralised by

property, equipment or other assets. All loans are subject to the Group’s credit sanctioning process. Collateral arrangements are

specific to the circumstances of each loan with additional guarantees and collateral sought from the sponsor of the structured entity

for certain arrangements. During the period the Group incurred immaterial impairment against such facilities.

Other

This includes fair value loans with structured entities where the market risk is materially hedged with corresponding derivative contracts,

interests in debt securities issued by securitisation vehicles and drawn and undrawn loan facilities to these entities. In addition, other

includes investment funds with interests restricted to management fees based on performance of the fund and trusts held on behalf of

beneficiaries with interests restricted to unpaid fees.

Assets transferred to sponsored unconsolidated structured entities

Barclays is considered to sponsor another entity if: it had a key role in establishing that entity, it transferred assets to the entity, the

Barclays name appears in the name of the entity or it provides guarantees on the entity’s performance. As at 31 December 2023,

assets transferred to sponsored unconsolidated structured entities were £1,420m (2022: £1,665m).

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 494 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Scope of consolidation | | | | | | | | | | |

35 Investments in associates and joint ventures

Accounting for associates and joint ventures

The equity accounted associates include the Group's investment in the Business Growth Fund £648m (2022: £669m) which has

decreased due to a fair value loss in its investments by £(10)m (2022: £ (21)m).

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | 2023 | | | 2022 | | |
|  | Associates | Joint ventures | Total | Associates | Joint ventures | Total |
|  | £m | £m | £m | £m | £m | £m |
| Equity accounted | 670 | 209 | 879 | 695 | 227 | 922 |
| Held at fair value through profit or loss | — | 516 | 516 | — | 435 | 435 |
| Total | 670 | 725 | 1,395 | 695 | 662 | 1,357 |

Summarised financial information for the Group’s equity accounted associates and joint ventures is set out below. The amounts shown

are the Group’s share of the net income of the investees for the year ended 31 December 2023, with the exception of certain

undertakings for which the amounts are based on accounts made up to dates not earlier than three months before the balance sheet

date.

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | Associates | | | Joint ventures | | |
|  | 2023 | 2022 | 2021 | 2023 | 2022 | 2021 |
|  | £m | £m | £m | £m | £m | £m |
| Profit/(loss) from continuing operations | (10) | (21) | 219 | 1 | 26 | 35 |
| Other comprehensive income/(loss) | — | — | 1 | (3) | 1 | 5 |
| Total comprehensive income/(loss) from continuing operations | (10) | (21) | 220 | (2) | 27 | 40 |

Unrecognised shares of the losses of individually immaterial associates and joint ventures were £nil (2022: £nil).

The Group has provided £nil (2022: £nil) to its joint ventures and associates. The Barclays drawn commitments to finance or otherwise

provide resources to its joint ventures and associates are £474m (2022: £474m ) The Barclays share of the associates and joint

ventures unutilised credit facilities commitments amounted to  £1,695m (2022: £1,796m).

36 Securitisations

Accounting for securitisations

The Group uses securitisations as a source of finance and a means of risk transfer. Such transactions generally result in the transfer of

contractual cash flows from portfolios of financial assets to holders of issued debt securities.

Securitisations may, depending on the individual arrangement, result in continued recognition of the securitised assets and the

recognition of the debt securities issued in the transaction; lead to partial continued recognition of the assets to the extent of the

Group’s continuing involvement in those assets or lead to derecognition of the assets and the separate recognition, as assets or

liabilities, of any rights and obligations created or retained in the transfer. Full derecognition only occurs when the Group transfers both

its contractual right to receive cash flows from the financial assets, or retains the contractual rights to receive the cash flows, but

assumes a contractual obligation to pay the cash flows to another party without material delay or reinvestment, and also transfers

substantially all the risks and rewards of ownership, including credit risk, prepayment risk and interest rate risk.

In the course of its normal banking activities, the Group makes transfers of financial assets, either where legal rights to the cash flows

from the asset are passed to the counterparty or beneficially, where the Group retains the rights to the cash flows but assumes a

responsibility to transfer them to the counterparty. Depending on the nature of the transaction, this may result in derecognition of the

assets in their entirety, partial derecognition or no derecognition of the assets subject to the transfer.

A summary of the main transactions, and the assets and liabilities and the financial risks arising from these transactions, is set out below:

Transfers of financial assets that do not result in derecognition

Securitisations

The Group was party to securitisation transactions involving its credit card balances and other personal lending. In these transactions,

the assets, interests in the assets, or beneficial interests in the cash flows arising from the assets, are transferred to a special purpose

entity, which then issues interest bearing debt securities to third party investors.

Securitisations may, depending on the individual arrangement, result in continued recognition of the securitised assets and the

recognition of the debt securities issued in the transaction. Partial continued recognition of the assets to the extent of the Group’s

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 495 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Scope of consolidation | | | | | | | | | | |

continuing involvement in those assets can also occur or derecognition of the assets and the separate recognition, as assets or

liabilities, of any rights and obligations created or retained in the transfer.

The following table shows the carrying amount of securitised assets that have not resulted in full derecognition, together with the

associated liabilities, for each category of asset on the balance sheet:

|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
|  | 2023 | | | | 2022 | | | |
|  | Assets | | Liabilities | | Assets | | Liabilities | |
|  | Carrying  amount | Fair value | Carrying  amount | Fair value | Carrying  amount | Fair value | Carrying  amount | Fair value |
|  | £m | £m | £m | £m | £m | £m | £m | £m |
| Loans and advances at amortised cost |  |  |  |  |  |  |  |  |
| Credit cards, unsecured and other retail lending | 6,451 | 6,996 | (2,369) | (2,336) | 5,324 | 5,761 | (1,537) | (1,460) |
| Mortgage Loans | 478 | 499 | (21) | (26) | 496 | 439 | (20) | (20) |
| Financial assets at FVTPL |  |  |  |  |  |  |  |  |
| Mortgage Loans | 452 | 452 | — | — | 330 | 330 | — | — |
| Total | 7,381 | 7,947 | (2,390) | (2,362) | 6,150 | 6,530 | (1,557) | (1,480) |

Balances included within loans and advances at amortised cost represent securitisations where substantially all the risks and rewards of

the asset have been retained by the Group and balances included within Financial assets at FVTPL represent securitisations where the

risks and rewards are neither substantially transferred nor retained.

The relationship between the transferred assets and the associated liabilities is that holders of notes may only look to cash flows from

the securitised assets for payments of principal and interest due to them under the terms of their notes, although the contractual

terms of their notes may be different to the maturity and interest of the transferred assets.

If Barclays transfers a financial asset but does not transfer or retain substantially all the risk and rewards of the asset and retains control

over it, the transferred assets is recognised to the extent of Barclays’ continuing involvement. Total Financial assets of £3,353m (2022:

£828m) were transferred in this manner and the carrying value of the asset representing continued involvement is included in the table

above.

For transfers of assets in relation to repurchase agreements, refer to Note 37.

Continuing involvement in financial assets that have been derecognised

In some cases, the Group may have transferred a financial asset in its entirety but may have continuing involvement in it. This arises in

asset securitisations where loans and asset backed securities were derecognised as a result of the Group’s involvement with asset

backed securities, residential mortgage backed securities and commercial mortgage backed securities. Continuing involvement largely

arises from providing financing into these structures in the form of retained notes, which do not bear first losses.

The table below shows the potential financial implications of such continuing involvement:

|  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |
|  | Continuing involvement1 | | |  | Gain from continuing involvement | |
|  | Carrying amount | Fair value | Maximum  exposure to loss |  | For the year ended | Cumulative to 31  December |
| Type of transfer | £m | £m | £m |  | £m | £m |
| 2023 |  |  |  |  |  |  |
| Asset backed securities | 2 | 2 | 2 |  | — | 3 |
| Residential mortgage backed securities | 1,798 | 1,796 | 1,798 |  | 49 | 68 |
| Commercial mortgage backed securities | 392 | 341 | 392 |  | 3 | 19 |
| Total | 2,192 | 2,139 | 2,192 |  | 52 | 90 |
|  |  |  |  |  |  |  |
| 2022 |  |  |  |  |  |  |
| Asset backed securities | 8 | 8 | 8 |  | 1 | 3 |
| Residential mortgage backed securities | 913 | 907 | 913 |  | 18 | 22 |
| Commercial mortgage backed securities | 412 | 357 | 412 |  | 5 | 16 |
| Total | 1,333 | 1,272 | 1,333 |  | 24 | 41 |

Note

1 Assets which represent the Group’s continuing involvement in derecognised assets are recorded in Loans and advances at amortised cost and Debt securities at FVTPL.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 496 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Scope of consolidation | | | | | | | | | | |

37 Assets pledged, collateral received and assets transferred

Assets are pledged or transferred as collateral to secure liabilities under repurchase agreements, securitisations and stock lending

agreements or as security deposits relating to derivatives. Assets transferred are non-cash assets transferred to a third party that do

not qualify for derecognition from the Group balance sheet, for example because Barclays retains substantially all the exposure to those

assets under an agreement to repurchase them in the future for a fixed price.

Assets pledged or transferred as collateral include all assets categorised as encumbered in the disclosure on page s  197  to 201 of the

Barclays PLC Pillar 3 Report 2023 (unaudited), other than those held in commercial paper conduits. In these transactions, the Group will

be required to step in to provide financing itself under a liquidity facility if the vehicle cannot access the commercial paper market.

Where non-cash assets are pledged or transferred as collateral for cash received, the asset continues to be recognised in full, and a

related liability is also recognised on the balance sheet. Where non-cash assets are pledged or transferred as collateral in an exchange

for non-cash assets, the transferred asset continues to be recognised in full, and there is no associated liability as the non-cash

collateral received is not recognised on the balance sheet. The Group is unable to use, sell or pledge the transferred assets for the

duration of the transaction and remains exposed to interest rate risk and credit risk on these pledged assets. Unless stated, the

counterparty's recourse is not limited to the transferred assets.

Collateralised transactions, such as securities lending and borrowing, repurchase and derivative transactions are conducted in

accordance with standard terms which are customary in the market.

The following table summarises the nature and carrying amount of the assets pledged as security:

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| Cash collateral and settlements | 73,495 | 78,996 |
| Loans and advances at amortised cost | 71,018 | 64,772 |
| Trading portfolio assets | 117,325 | 63,969 |
| Financial assets at fair value through the income statement | 9,847 | 8,220 |
| Financial assets at fair value through other comprehensive income | 23,503 | 18,210 |
| Assets pledged | 295,188 | 234,167 |

The following table summarises the transferred financial assets and the associated liabilities. The transferred assets represent the

gross carrying value of the assets pledged and the associated liabilities represent the IFRS balance sheet value of the related liability

recorded on the balance sheet:

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | Transferred assets | Associated  liabilities |
|  | £m | £m |
| As at 31 December 2023 |  |  |
| Derivatives | 78,390 | (78,390) |
| Repurchase agreements | 86,712 | (55,006) |
| Securities lending arrangements | 118,632 | — |
| Other | 11,454 | (10,179) |
|  | 295,188 | (143,575) |
|  |  |  |
| As at 31 December 2022 |  |  |
| Derivatives | 79,474 | (79,474) |
| Repurchase agreements | 74,291 | (46,617) |
| Securities lending arrangements | 67,554 | — |
| Other | 12,848 | (11,055) |
|  | 234,167 | (137,146) |

For repurchase agreements the difference between transferred assets and the associated liabilities is predominantly due to IFRS

netting. Included within Other are agreements where a counterparty's recourse is limited to the transferred assets. The relationship

between the gross transferred assets and the associated liabilities is that holders of notes may only look to cash flows from the

securitised assets for payments of principal and interest due to them under the terms of their notes.

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  | Carrying value | | Fair value | | |
|  | Transferred assets | Associated  liabilities | Transferred assets | Associated  liabilities | Net position |
|  | £m | £m | £m | £m | £m |
| 2023 |  |  |  |  |  |
| Recourse to transferred assets only | 7,381 | (2,390) | 7,947 | (2,362) | 5,585 |
| 2022 |  |  |  |  |  |
| Recourse to transferred assets only | 6,150 | (1,557) | 6,530 | (1,480) | 5,050 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 497 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Scope of consolidation | | | | | | | | | | |

The Group has an additional £6.4bn (2022: £5.3bn) of loans and advances within its asset backed funding programmes that can readily

be used to raise additional secured funding and are available to support future issuances.

Collateral held as security for assets

Under certain transactions, including reverse repurchase agreements and stock borrowing transactions, the Group is allowed to resell

or re-pledge the collateral held. Collateralised transactions, such as securities lending and borrowing, repurchase and derivative

transactions are conducted in accordance with standard terms which are customary in the market.

The fair value at the balance sheet date of collateral accepted and re-pledged or transferred to others was as follows:

|  |  |  |
| --- | --- | --- |
|  |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| Fair value of securities accepted as collateral | 1,207,697 | 988,340 |
| Of which fair value of securities re-pledged/transferred to others | 1,105,140 | 892,026 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 498 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Scope of consolidation | | | | | | | | | | |

#### Other disclosure matters

The notes included in this section focus on related party transactions, Auditor's remuneration, Barclays PLC (the Parent company)

disclosure, Directors’ remuneration and Transition disclosures. Related parties include any subsidiaries, associates, joint ventures and

Key Management Personnel.

38 Related party transactions and Directors’ remuneration

Related party transactions

Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other

party in making financial or operational decisions, or one other party controls both.

Subsidiaries

Transactions between Barclays PLC and its subsidiaries meet the definition of related party transactions. Where these are eliminated

on consolidation, they are not disclosed in the Group’s financial statements. Transactions between Barclays PLC and its subsidiaries are

fully disclosed in Barclays PLC’s financial statements. A list of the Group’s principal subsidiaries is shown in Note 33.

Associates, joint ventures and other entities

The Group provides banking services to its associates, joint ventures and the Group pension funds (principally the UK Retirement Fund),

providing loans, overdrafts, interest and non-interest bearing deposits and current accounts to these entities as well as other services.

Group companies also provide investment management and custodian services to the Group pension schemes. All of these

transactions are conducted on the same terms as third party transactions. Summarised financial information for the Group’s

investments in associates and joint ventures is set out in Note 35.

Amounts included in the Group’s financial statements, in aggregate, by category of related party entity are as follows:

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | Associates | Joint ventures | Pension funds |
|  | £m | £m | £m |
| For the year ended and as at 31 December 2023 |  |  |  |
| Total income | 13 | 70 | 4 |
| Credit impairment charges | — | — | — |
| Operating expenses | (20) | — | (1) |
| Total assets | — | 1,254 | — |
| Total liabilities | 158 | — | 144 |
| For the year ended and as at 31 December 2022 |  |  |  |
| Total income | (2) | 91 | 5 |
| Credit impairment charges | — | — | — |
| Operating expenses | (15) | — | (1) |
| Total assets | — | 1,336 | 3 |
| Total liabilities | 408 | — | 166 |
| For the year ended and as at 31 December 2021 |  |  |  |
| Total income | — | 50 | 5 |
| Credit impairment charges | — | — | — |
| Operating expenses | (20) | — | (1) |

Total liabilities includes derivatives transacted on behalf of the pension funds of £77m (2022: £110m ).

Key Management Personnel

Key Management Personnel are defined as those persons having authority and responsibility for planning, directing and controlling the

activities of Barclays PLC (directly or indirectly) and comprise the Directors and Officers of Barclays PLC, certain direct reports of the

Group Chief Executive and the heads of major business units and functions.

The Group provides banking services to Key Management Personnel and persons connected to them. Transactions during the year and

the balances outstanding were as follows:

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Loans outstanding |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| As at 1 January | 7.5 | 7.8 |
| Loans issued during the year1 | 2.5 | 1.4 |
| Loan repayments during the year2 | (1.7) | (1.7) |
| As at 31 December | 8.3 | 7.5 |

Notes

1 Includes loans issued to existing Key Management Personnel and new or existing loans issued to newly appointed Key Management Personnel.

2 Includes loan repayments by existing Key Management Personnel and loans to former Key Management Personnel.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 499 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Other disclosure matters | | | | | | | | | | |

No allowances for impairment were recognised in respect of loans to Key Management Personnel (or any connected person).

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Deposits outstanding |  |  |
|  | 2023 | 2022 |
|  | £m | £m |
| As at 1 January | 15.2 | 9.1 |
| Deposits received during the year1 | 105.7 | 47.9 |
| Deposits repaid during the year2 | (105.5) | (41.8) |
| As at 31 December | 15.4 | 15.2 |

Notes

1 Includes deposits received from existing Key Management Personnel and new or existing deposits received from newly appointed Key Management Personnel.

2 Includes deposits repaid by existing Key Management Personnel and deposits of former Key Management Personnel.

Total commitments outstanding

Total commitments outstanding refers to the total of any undrawn amounts on credit cards and/or overdraft facilities provided to Key

Management Personnel. Total commitments outstanding as at 31 December 2023 were £0.5m (2022: £0.5m).

All loans to Key Management Personnel (and persons connected to them) were made in the ordinary course of business; were made on

substantially the same terms, including interest rates and collateral, as those prevailing at the same time for comparable transactions

with other persons; and did not involve more than a normal risk of collectability or present other unfavourable features.

Remuneration of Key Management Personnel

Total remuneration awarded to Key Management Personnel below represents salaries, short term benefits and pensions contributions

received during the year and awards made as part of the latest remuneration decisions in relation to the year. Costs recognised in the

income statement reflect the accounting charge for the year included within operating expenses. The difference between the values

awarded and the recognised income statement charge principally relates to the recognition of costs for deferred awards. Figures are

provided for the period that individuals met the definition of Key Management Personnel.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Salaries and other short-term benefits | 33.3 | 32.4 | 37.8 |
| Pension costs | — | — | — |
| Other long-term benefits | 7.2 | 7.8 | 8.5 |
| Share-based payments | 10.2 | 9.8 | 12.2 |
| Employer social security charges on emoluments | 6.3 | 6.7 | 7.2 |
| Costs recognised for accounting purposes | 57.0 | 56.7 | 65.7 |
| Employer social security charges on emoluments | (6.3) | (6.7) | (7.2) |
| Other long-term benefits – difference between awards granted and costs recognised | 1.1 | — | 3.1 |
| Share-based payments – difference between awards granted and costs recognised | 6.0 | 6.5 | 6.9 |
| Total remuneration awarded | 57.8 | 56.5 | 68.5 |

Disclosure required by the Companies Act 2006

The following information regarding the Barclays PLC Board of Directors is presented in accordance with the Companies Act 2006:

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Aggregate emoluments1 | 9.8 | 9.3 | 8.2 |
| Amounts paid under LTIPs2 | — | 0.4 | 1.2 |
|  | 9.8 | 9.7 | 9.4 |

Notes

1 The aggregate emoluments include amounts paid for the  2023 year. In addition, deferred share awards for 2023 with a total value at grant of £1.5m (2022: £2.3m, 2021: £1.4m) will be

made to Directors which will only vest subject to meeting certain conditions.

2 The figure above for "Amounts paid under LTIPs" relates to LTIP awards that were released to Directors during the year. Dividend shares released on the awards are excluded (where

applicable). The LTIP figure in the single total figure table for Executive Directors' 2023 remuneration in the Directors' Remuneration report relates to awards that are scheduled to be

released in 2024 in respect of the 2021-2023 LTIP cycle.

There were  no pension contributions paid to defined contribution schemes on behalf of Directors (2022: £nil, 2021: £nil). There were no

notional pension contributions to defined contribution schemes.

As at 31 December 2023, there were no Directors accruing benefits under a defined benefit scheme (2022: nil, 2021: £nil).

Directors’ and Officers’ shareholdings and options

The beneficial ownership of ordinary share capital of Barclays PLC by all Directors and Officers of Barclays PLC (involving 26 persons) at

31 December 2023 amounted to 14,833,002  (2022: 15,944,986) ordinary shares of 25p each (0.10% of the ordinary share capital

outstanding).

As at 31 December 2023, Executive Directors and Officers of Barclays PLC (involving 16 persons) held options to purchase a total of

67,319 (2022: 62,268) Barclays PLC ordinary shares of 25p each at a weighted average price of 92p under Sharesave.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 500 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Other disclosure matters | | | | | | | | | | |

Advances and credit to Directors and guarantees on behalf of Directors

In accordance with Section 413 of the Companies Act 2006, the total amount of advances and credits made available in 2023 to

persons who served as Directors during the year was £0.3m ( 2022: £0.2m). The total value of guarantees entered into on behalf of

Directors during 2023 was £nil (2022: £nil).

39 Auditor’s remuneration

Auditor’s remuneration is included within consultancy, legal and professional fees in administration and general expenses and

comprises:

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
|  | £m | £m | £m |
| Audit of the Barclays Group's annual accounts | 11 | 10 | 9 |
| Other services: |  |  |  |
| Audit of the Company's subsidiaries1 | 53 | 48 | 41 |
| Other audit related fees2 | 12 | 11 | 10 |
| Other services | 2 | 2 | 2 |
| Total Auditor's remuneration | 78 | 71 | 62 |

Notes

1 Comprises the fees for the statutory audit of subsidiaries both inside and outside the UK and fees for work performed by associates of KPMG in respect of the consolidated financial

statements of the Company.

2 Comprises services in relation to statutory and regulatory filings. These include audit services for the review of the interim financial information under the Listing Rules of the UK listing

authority .

Audit scope changes are finalised following the completion of the audit and recognised when agreed. The 2023 audit fee includes £1m

(2022: £2m, 2021: £3m )  relating to the previous year’s audit.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  | 2023 | 2022 | 2021 |
| Barclays associated pension schemes | £m | £m | £m |
| Audit fee | 0.3 | 0.3 | 0.3 |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 501 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Other disclosure matters | | | | | | | | | | |

40 Assets and liabilities included in disposal group classified as held for sale

Accounting for  non-current assets held for sale and associated liabilities

The Group applies IFRS 5 Non-current Assets Held for Sale and Discontinued Operations.  Non-current assets (or disposal groups) are

classified as held for sale when their carrying amount is to be recovered principally through a sale transaction rather than continuing use.

In order to be classified as held for sale, the asset must be available for immediate sale in its present condition subject only to terms that

are usual and customary, and the sale must be highly probable. Non-current assets (or disposal groups) held for sale are measured at

the lower of carrying amount and fair value less cost to sell.  Assets and liabilities classified as held for sale are presented separately in

the consolidated balance sheet.

Management accounting estimates and judgements

Management judgement is required in determining whether the IFRS 5 held for sale classification criteria are met, in particular whether

the sale is highly probable and expected to qualify for recognition as a completed sale within 12 months of classification. This

assessment requires consideration of how committed management is to the sales plan, the likelihood of obtaining regulatory or other

external approvals which is often required for sales of banking operations and how committed the buyer is to complete the sales

transaction within the agreed timelines.

Barclays is currently engaged in a process to sell its German consumer finance business (comprising credit cards, unsecured personal

loans and deposits), currently within CC&P, as part of our ambition to simplify Barclays and support our focus on growing our key

businesses.  A sale is expected to complete in 2024.

The perimeter of the disposal group has been accounted for in line with the requirements of IFRS5 as at 31 December 2023.  A detailed

analysis of the disposal group is presented below:

|  |  |
| --- | --- |
|  |  |
| As at 31 December | 2023 |
|  | £m |
| Assets included in disposal groups classified as held for sale |  |
| Loans and advances to customers | 3,855 |
| Intangible assets | 15 |
| Property, plant and equipment | 24 |
| Other assets | 22 |
| Total assets classified as held for sale | 3,916 |
|  |  |
| Liabilities included in disposal groups classified as held for sale |  |
| Deposits from customers | 3,077 |
| Other liabilities | 83 |
| Provisions | 4 |
| Total liabilities classified as held for sale | 3,164 |
|  |  |
| Net assets classified as held for sale | 752 |

41 Subsequent events

Barclays announced on 9 February 2024 that Barclays Bank UK PLC has entered into an agreement with Tesco Personal Finance plc

(operating using the trading name “Tesco Bank”) to acquire its retail banking business, which includes credit cards, unsecured personal

loans, deposits and the operating infrastructure. Additionally upon completion, Barclays Bank UK PLC will enter into a long-term,

exclusive strategic partnership with Tesco Stores Limited for an initial period of 10 years to market and distribute credit cards,

unsecured personal loans and deposits using the Tesco brand, as well as explore other opportunities to offer financial services to Tesco

customers. The transaction involves the acquisition of approximately £8.3bn of unsecured lending balances, including approximately

£4.2bn of gross credit card receivables and £4.1bn of gross unsecured personal loans, together with approximately £6.7bn in customer

deposits. The acquisition is expected to occur in H2 2024, subject to court sanction and regulatory approvals.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 502 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Other disclosure matters | | | | | | | | | | |

42 Barclays PLC (the Parent company)

Total income

Dividend received from subsidiaries

Dividends received from subsidiaries of  £ 2,818m ( 2022: £ 2,797 m, 2021: £ 1,356 m) relates to dividends received from Barclays

Execution Services Limited £165m, Barclays Bank UK PLC £1,305m  and Barclays Bank PLC £1,348m.

Other income

Other income of £1,174m (2022: £(654)m expense, 2021: £ 659m income) includes fair value and foreign exchange gains of £50m

(2022: £1,673m, 2021: £250m) on positions with subsidiaries and £985 m (2022: £905m, 2021: £804m) of income received from gross

coupon payments on Barclays Bank PLC and Barclays Bank UK PLC-issued AT1 securities.

Total assets and liabilities

Investment in subsidiaries

The investment in subsidiaries of £64,461m (2022: £64,544m) predominantly relates to investments in the ordinary shares of Barclays

Bank PLC of £36,340m (2022: £36,340m) and their AT1 securities of £10,757m (2022: £10,760m), as well as investments in the

ordinary shares of Barclays Bank UK PLC of  £14,245m (2022: 14,245m) and their AT1 securities of  £2,439m  (2022: £2,570m). The

decrease of £83m  during the year resulted from a capital injection of £50m to Barclays Principal Investments Limited offset by a

decrease in the AT1 holdings and associated fair value which totalled £133m.

Impairment in subsidiaries

At the end of each reporting period an impairment review is undertaken in respect of investment in the ordinary shares of subsidiaries.

Where impairment may be indicated a test of the carrying value against the recoverable value is performed; impairment being indicated

where the investment exceeds the recoverable amount. The recoverable amount is calculated as a value in use (VIU) which is derived

from the present value of future cash flows expected to be received from the investment. The VIU calculations use forecast profits

based on financial budgets approved by management, covering a five year period as an approximation of future cash flows discounted

using a pre-tax discount rate appropriate to the subsidiary being tested. A terminal growth rate has then been applied to the cash flows

thereafter which is based upon expectations of future inflation rates. The 2023 review identified the value in use calculated was higher

than the carrying value for all subsidiaries.

Loans and advances to subsidiaries

During the year loans and advances to subsidiaries decreased by £4,702m to £18,926m (2022: £23,628m). The decrease was largely

driven due to maturities of £4,982m intra-group loans to Barclays PLC subsidiaries and foreign exchange impact of £1,049m due to the

appreciation of GBP largely against USD. This was partially offset by the new issuances of intra-group loans to Barclays PLC subsidiaries

of £1,260m.

Subordinated liabilities and debt securities in issue

During the year, Barclays PLC issued USD1,500m of Fixed-to-Floating Rate Resetting Subordinated Callable Notes, which are included

within the subordinated liabilities balance of £10,018m (2022: £11,230m). Debt securities in issue of £18,308m (2022: £24,086m) have

reduced during the year primarily due to  maturities of £4,931m senior issuances and the  foreign exchange impact of £847m due to the

appreciation of GBP largely against USD.

Financial assets and liabilities designated at fair value

Financial liabilities designated at fair value of £31,832mm (2022: £22,971m) primarily included new issuances during the year of

EUR1,250m Fixed Rate Resetting Senior Callable Notes, £2,000m Fixed Rate Resetting Senior Callable Notes, USD8,200m Fixed-to-

Floating Rate Senior Callable Notes and USD300m Floating Rate Senior Notes . The proceeds raised through these transactions were

used to invest in subsidiaries of Barclays PLC and are included within the financial assets designated at fair value through the income

statement balance of £35,787m (2022: £28,930m). The effect of changes in the liabilities fair value, including those due to credit risk, is

expected to offset the changes in the fair value of the related financial asset in the income statement. The difference between the

financial liabilities carrying amount and the contractual amount on maturity is £1,838m  (2022: £2,100m).

Derivative financial instruments

During the year derivative financial liabilities decreased by £195m to £711m (2022: £906m). This is primarily driven by the gain in

derivatives due to a decreasing rate environment.

Total equity

Called up share capital and share premium

Called up share capital and share premium of Barclays PLC is  £4,288m (2022: £4,373m). The decrease in the year is primarily due to

837m shares repurchased with a total nominal value of £209m. This decrease was offset by shares issued under employee share

schemes.

Other equity instruments

Other equity instruments of £13,198m (2022: £13,250m) comprises AT1 securities issued by Barclays PLC. The AT1 securities are

perpetual securities with no fixed maturity and are structured to qualify as AT1 instruments under prevailing capital rules applicable as at

the relevant issue date. During the year there were three issuances with principal amounts totalling £1,500m, USD1,750m and

SGD400m and redemptions with principal amounts totalling £1,250m and USD2,500m. For further details, please refer to Note 27.

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 503 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Other disclosure matters | | | | | | | | | | |

43 Related undertakings

The Group’s corporate structure consists

of a number of related undertakings,

comprising subsidiary undertakings, joint

ventures, associated undertakings and

significant holdings. A full list of these

related undertakings is set out below,

together with the country of incorporation,

registered office (or principal place of

business) and the identity and percentage

of each share class held by the Group. The

information is provided as at 31 December

2023.

The entities are grouped by the countries

in which they are incorporated. The profits

earned by the activities of these entities

are in some cases taxed in countries other

than the country of incorporation, for

example where the entity carries on

business through a branch in a territory

outside of  its country of incorporation .

Barclays PLC Country Snapshot provides

details of where the Group carries on its

business, where its profits are subject to

tax and the taxes it pays in each country it

operates in.

Wholly owned subsidiaries

Unless otherwise stated the undertakings

below are wholly owned and included in the

consolidation and the share capital held by

the Group comprises ordinary and/or

common shares, which are held by

subsidiaries of Barclays PLC. Unless

otherwise stated, the Group holds 100%

of the nominal value of each share class.

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | Notes | |  |
|  | A | Directly held by Barclays PLC |  |
|  | B | Partnership Interest |  |
|  | C | Membership Interest |  |
|  | D | Guarantor |  |
|  | E | Preference Shares |  |
|  | F | A Preference Shares |  |
|  | G | B  Preference Shares |  |
|  | H | Ordinary/Common Shares in addition to  other shares |  |
|  | I | A Ordinary Shares |  |
|  | J | B Ordinary Shares |  |
|  | K | C Ordinary Shares |  |
|  | L | F Ordinary Shares |  |
|  | M | First Preference Shares, Second  Preference shares |  |
|  | N | Registered Address not in country of  incorporation |  |
|  | O | Core Shares, Insurance (Classified)  Shares |  |
|  | P | Class B, C, D (100%),  E, F, G, H, I (94.36%),  J (95.32%) and K (100%) |  |
|  | Q | Non-Redeemable Ordinary Shares |  |
|  |  |  |  |

|  |  |  |  |
| --- | --- | --- | --- |
|  |  |  |  |
|  |  |  |  |
|  | Notes | |  |
|  | R | Class A, B and D Shares |  |
|  | S | Class A and Class B Shares |  |
|  | T | PEF Carry Shares |  |
|  | U | Not Consolidated (see Note 33 Principal  Subsidiaries) |  |
|  | V | USD Linked Ordinary Shares |  |
|  | W | Redeemable Class B Shares |  |
|  | X | Capital Contribution Shares |  |
|  | Y | Class A Redeemable Preference Shares |  |
|  | Z | Class B Redeemable Preference Shares |  |
|  | AA | First Class Common Shares, Second  Class Common Shares |  |
|  | BB | Tracker 1 GBP, USD, Euro Shares;  Tracker 2 USD Shares, Tracker 3 USD  Shares |  |
|  | CC | Non-Voting Redeemable Preference  Shares |  |
|  |  |  |  |

|  |  |
| --- | --- |
|  |  |
| Wholly owned subsidiaries | Note |
| United Kingdom |  |
| 1 Churchill Place, London, E14 5HP |  |
| Aequor Investments Limited |  |
| Alynore Investments Limited Partnership | B |
| Ardencroft Investments Limited |  |
| B D & B Investments Limited |  |
| B.P.B. (Holdings) Limited |  |
| Barclay Leasing Limited |  |
| Barclays Aldersgate Investments Limited |  |
| Barclays Asset Management Limited |  |
| Barclays Bank PLC | A, E,  H |
| Barclays Bank UK PLC | A |
| Barclays Capital Asia Holdings Limited |  |
| Barclays Capital Nominees (No.2) Limited |  |
| Barclays Capital Nominees (No.3) Limited |  |
| Barclays Capital Nominees Limited |  |
| Barclays Capital Securities Client Nominee  Limited |  |
| Barclays Capital Securities Limited | E, H |
| Barclays CCP Funding LLP | B |
| Barclays Converted Investments (No.2) Limited |  |
| Barclays Direct Investing Nominees Limited |  |
| Barclays Directors Limited |  |
| Barclays Equity Holdings Limited |  |
| Barclays Execution Services Limited | A |
| Barclays Executive Schemes Trustees Limited |  |
| Barclays Financial Planning Nominee Company  Limited |  |
| Barclays Funds Investments Limited |  |
| Barclays Group Holdings Limited |  |
| Barclays Industrial Development Limited |  |
| Barclays Industrial Investments Limited |  |
| Barclays Insurance Services Company Limited |  |
| Barclays International Holdings Limited |  |
| Barclays Investment Management Limited |  |
| Barclays Investment Solutions Limited |  |
| Barclays Leasing (No.9) Limited |  |
| Barclays Long Island Limited |  |
| Barclays Nominees (George Yard) Limited | U |
| Barclays OCIO Services Limited |  |
| Barclays Pension Funds Trustees Limited |  |
| Barclays Principal Investments Limited | A, I, J |
| Barclays Private Bank |  |

|  |  |
| --- | --- |
|  |  |
| Wholly owned subsidiaries | Note |
| Barclays SAMS Limited |  |
| Barclays Security Trustee Limited | A |
| Barclays Services (Japan) Limited |  |
| Barclays Shea Limited |  |
| Barclays Term Funding Limited Liability  Partnership | B |
| Barclays UK Investments Limited |  |
| Barclays Unquoted Investments Limited |  |
| Barclays Unquoted Property Investments Limited |  |
| Barclays Wealth Nominees Limited |  |
| Barclayshare Nominees Limited |  |
| Barcosec Limited |  |
| Barsec Nominees Limited |  |
| BB Client Nominees Limited |  |
| BMI (No.9) Limited |  |
| BNRI ENG 2014 Limited Partnership | B |
| BNRI ENG GP LLP | B |
| BNRI England 2010 Limited Partnership | B |
| BNRI England 2012 Limited Partnership | B |
| Carnegie Holdings Limited | H, I, J |
| Chapelcrest Investments Limited |  |
| Clydesdale Financial Services Limited |  |
| Cornwall Home Loans Limited |  |
| CPIA England 2009 Limited Partnership | B |
| CPIA England No.2 Limited Partnership | B |
| Dorset Home Loans Limited |  |
| Durlacher Nominees Limited |  |
| Eagle Financial and Leasing Services (UK)  Limited |  |
| Finpart Nominees Limited |  |
| FIRSTPLUS Financial Group Limited |  |
| Foltus Investments Limited |  |
| Global Dynasty Natural Resource Private Equity  Limited Partnership | B |
| Globe Nominees Limited |  |
| Hawkins Funding Limited |  |
| Heraldglen Limited | H, M |
| Isle of Wight Home Loans Limited |  |
| J.V. Estates Limited |  |
| Kirsche Investments Limited |  |
| Leonis Investments LLP | B |
| Long Island Assets Limited |  |
| Maloney Investments Limited |  |
| Menlo Investments Limited |  |
| Mercantile Credit Company Limited |  |
| Mercantile Leasing Company (No.132) Limited |  |
| MK Opportunities LP | B |
| Naxos Investments Limited |  |
| North Colonnade Investments Limited |  |
| Northwharf Investments Limited |  |
| Northwharf Nominees Limited |  |
| Oak Pension Asset Management Limited | U |
| Radbroke Mortgages UK Limited |  |
| Real Estate Participation Management Limited |  |
| Real Estate Participation Services Limited |  |
| Relative Value Investments UK Limited Liability  Partnership | B |
| Relative Value Trading Limited |  |
| Roder Investments No. 1 Limited | H, BB |
| Roder Investments No. 2 Limited | H, BB |
| RVT CLO Investments LLP | B |
| Surety Trust Limited |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 504 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Other disclosure matters | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| Wholly owned subsidiaries | Note |
| Sustainable Impact Capital Limited |  |
| Swan Lane Investments Limited |  |
| US Real Estate Holdings No.1 Limited |  |
| US Real Estate Holdings No.2 Limited |  |
| US Real Estate Holdings No.3 Limited |  |
| US Real Estate Holdings No.4 Limited |  |
| US Real Estate Holdings No.5 Limited |  |
| US Real Estate Holdings No.6 Limited |  |
| Water Street Investments Limited | U |
| Wedd Jefferson (Nominees) Limited |  |
| Westferry Investments Limited |  |
| Woolwich Homes Limited |  |
| Woolwich Qualifying Employee Share Ownership  Trustee Limited |  |
| Zeban Nominees Limited |  |
|  |  |
| C/O Teneo Financial Advisory Limited, 3rd  Floor, The Colmore Building, 20 Colmore Circus  Queensway, Birmingham, West Midlands, B4  6AT |  |
| Barclays Capital Finance Limited (In Liquidation) |  |
| Barclays Capital Japan Securities Holdings  Limited (In Liquidation) |  |
| Barclays Global Shareplans Nominee Limited (In  Liquidation) |  |
| Barclays Nominees (Branches) Limited (In  Liquidation) |  |
| Barclays Singapore Global Shareplans Nominee  Limited (In Liquidation) |  |
| Cobalt Investments Limited (In Liquidation) |  |
| DMW Realty Limited (In Liquidation) |  |
| Solution Personal Finance Limited (In Liquidation) |  |
|  |  |
| Ascot House, Maidenhead Office Park,  Maidenhead, SL6 3QQ |  |
| Kensington Mortgage Company Limited |  |
| Kensington Mortgage Services Limited |  |
|  |  |
| 1-4, Clyde Place Lane, Glasgow, G5 8DP |  |
| R.C. Greig Nominees Limited |  |
|  |  |
| 50 Lothian Road, Festival Square, Edinburgh,  EH3 9WJ |  |
| BNRI PIA Scot GP Limited |  |
| BNRI Scots GP, LLP | B |
| Pecan Aggregator LP | B, U |
|  |  |
| Logic House, Waterfront Business Park, Park,  Fleet Road, Fleet, GU51 3SB |  |
| The Logic Group Enterprises Limited |  |
| The Logic Group Holdings Limited | I |
|  |  |
| 9, allée Scheffer, L-2520, Luxembourg |  |
| Barclays Claudas Investments Partnership | B, N |
| Barclays Pelleas Investments Limited Partnership | B, N |
| Barclays Blossom Finance Limited Partnership | B, N |
|  |  |
|  |  |
|  |  |

|  |  |
| --- | --- |
|  |  |
| Wholly owned subsidiaries | Note |
| Argentina |  |
| 855 Leandro N.Alem Avenue, 8th Floor, Buenos  Aires |  |
| Compañía Sudamerica S.A. |  |
|  |  |
| Marval, O’Farrell & Mairal, Av. Leandro N.  Alem 882, Buenos Aires, C1001AAQ |  |
| Compañia Regional del Sur S.A. |  |
|  |  |
| Brazil |  |
| Av. Brigadeiro Faria Lima, No.4.440, 12th Floor,  Bairro Itaim Bibi, Sao Paulo, CEP, 04538-132 |  |
| Barclays Brasil Assessoria Financeira Ltda |  |
| BNC Brazil Consultoria Empresarial Ltda |  |
|  |  |
| Canada |  |
| 333 Bay Street, Suite 4910, Toronto ON M5H  2R2 |  |
| Barclays Capital Canada Inc. |  |
|  |  |
| Stikeman Elliot LLP, 199 Bay Street, 5300  Commerce Court West, Toronto ON M5L 1B9 |  |
| Barclays Corporation Limited |  |
|  |  |
| 1 Churchill Place, London, E14 5HP |  |
| CPIA Canada Holdings | B, N |
|  |  |
| Cayman Islands |  |
| PO Box  309, Ugland House, George Town,  Grand Cayman, KY1-1104 |  |
| Alymere Investments Limited | F, G,  H |
| Analytical Trade UK Limited |  |
| Barclays Capital (Cayman) Limited |  |
| Barclays Securities Financing Limited | F,  G ,H |
| Barclays US Holdings Limited | E, I |
| Braven Investments No.1 Limited |  |
| Calthorpe Investments Limited |  |
| Capton Investments Limited |  |
| Claudas Investments Limited | H, Y,  Z |
| Claudas Investments Two Limited |  |
| CPIA Investments No.2 Limited |  |
| Gallen Investments Limited |  |
| Hurley Investments No.1 Limited (In Liquidation) |  |
| Mintaka Investments No. 4 Limited |  |
| Palomino Limited | U |
| Pelleas Investments Limited |  |
| Pippin Island Investments Limited |  |
| Razzoli Investments Limited | E, H |
| RVH Limited | E, H |
| Wessex Investments Limited (In Liquidation) |  |
| Hornbeam Limited | U |
|  |  |
| Walkers Corporate Limited, Cayman Corporate  Centre, 27 Hospital Road, George Town, KY1-  9008 |  |
| Long Island Holding B Limited (In Liquidation) |  |
|  |  |

|  |  |
| --- | --- |
|  |  |
| Wholly owned subsidiaries | Note |
| France |  |
| 34-36 avenue de Friedland, 75008, Paris |  |
| Barclays ADF |  |
|  |  |
| Germany |  |
| Stuttgarter Straße 55-57, 73033 Göppingen |  |
| Holding Stuttgarter Straße GmbH  (In Liquidation) |  |
|  |  |
| Guernsey |  |
| P.O. Box 33, Dorey Court, Admiral Park, St.  Peter Port, GY1 4AT |  |
| Barclays Insurance Guernsey PCC Limited | O |
| Barclays UKRF No.1 IC Limited | U |
| Barclays UKRF ICC Limited | U |
| Barclays UKRF No.2 IC Ltd | U |
|  |  |
| Hong Kong |  |
| 42nd floor Citibank Tower, Citibank Plaza,  3 Garden Road |  |
| Barclays Bank (Hong Kong Nominees) Limited  (In Liquidation) |  |
| Barclays Capital Asia Nominees Limited  (In Liquidation) |  |
|  |  |
| Level 41, Cheung Kong Center, 2 Queen's  Road, Central |  |
| Barclays Capital Asia Limited |  |
|  |  |
| India |  |
| 208 Ceejay House, Shivsagar Estate, Dr A  Beasant Road, Worli, Mumbai, 400 018 |  |
| Barclays Securities (India) Private Limited |  |
| Barclays Wealth Trustees (India) Private Limited |  |
|  |  |
| 5th to 12th Floor (Part), Building G2, Gera  Commerzone SEZ, Survey No.65, Kharadi,  Pune, 411014 |  |
| Barclays Global Service Centre Private Limited |  |
|  |  |
| Nirlon Knowledge Park, Level 9, Block B-6, Off  Western Express Highway, Goregaon (East),  Mumbai, 400063 |  |
| Barclays Investments & Loans (India) Private  Limited | E, H |
|  |  |
| Ireland |  |
| One Molesworth Street, Dublin 2, D02RF29 |  |
| Barclaycard International Payments Limited |  |
| Barclays Bank Ireland Public Limited Company |  |
| Barclays Europe Client Nominees Designated  Activity Company |  |
| Barclays Europe Firm Nominees Designated  Activity Company |  |
| Barclays Europe Nominees Designated Activity  Company |  |
|  |  |
| 25-28 North Wall Quay, Dublin1, D01H104 |  |
| Erimon Home Loans Ireland Limited |  |
|  |  |
| 70 Sir John Rogerson’s Quay, Dublin 2 |  |
| Barclays Finance Ireland Limited |  |
|  |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 505 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Other disclosure matters | | | | | | | | | | |

|  |  |
| --- | --- |
|  |  |
| Wholly owned subsidiaries | Note |
| Corporation Service Company, 251 Little Falls  Drive, Wilmington, DE 19808 |  |
| Barclays Ireland Investments LP | B, N |
|  |  |
| Isle of Man |  |
| Eagle Court, Circular Road, Douglas, IM1 1AD |  |
| Barclays Nominees (Manx) Limited | I, J |
| Barclays Private Clients International Limited |  |
|  |  |
| 2nd Floor, St Georges Court, Upper Church  Street, Douglas, IM1 1EE |  |
| Barclays Holdings (Isle of Man) Limited (In  Liquidation) |  |
|  |  |
| Japan |  |
| 10-1, Roppongi 6-chome, Minato-ku, Tokyo |  |
| Barclays Funds and Advisory Japan Limited |  |
| Barclays Securities Japan Limited | F, H |
| Barclays Wealth Services Limited |  |
|  |  |
| Jersey |  |
| Gaspé House, 66-72 Esplanade, St. Helier, JE1  1GH |  |
| Barclays Services Jersey Limited |  |
|  |  |
| 5 Espalanade, St Helier, JE2 3QA |  |
| Barclays Wealth Management Jersey Limited |  |
|  |  |
| 13 Library Place, St Helier, JE4 8NE |  |
| Barclays Nominees (Jersey) Limited |  |
| Barclaytrust Channel Islands Limited |  |
|  |  |
| Estera Trust (Jersey) Limited, 13-14  Esplanade, St Helier, JE1 1EE, Jersey |  |
| MK Opportunities GP Ltd |  |
|  |  |
| Luxembourg |  |
| 9, allée Scheffer, L-2520 |  |
| Barclays Bedivere Investments S.à r.l. |  |
| Barclays Cantal Investments S.à r.l. |  |
| Barclays Capital Luxembourg S.à r.l. |  |
| Barclays Capital Trading Luxembourg S.à r.l. |  |
| Barclays Claudas Investments S.à r.l. |  |
| Barclays Equity Index Investments S.à r.l. |  |
| Barclays International Luxembourg Dollar  Holdings S.à r.l. |  |
| Barclays Luxembourg EUR Holdings S.à r.l | Q |
| Barclays Luxembourg GBP Holdings S.à r.l. | Q |
| Barclays Luxembourg Global Funding S.à r.l. |  |
| Barclays Luxembourg Holdings S.à r.l. | H, V |
| Barclays Luxembourg Holdings SSC | B |
| BNRI Limehouse No.1 S.à r.l. | P |
|  |  |
| 68-70 Boulevard de la Petrusse, L-2320 |  |
| Adler Toy Holding Sarl |  |
|  |  |
| 10 rue du Cha'teau d'Eau, Leudelange, Grand  Duchy of Luxembourg L-3364 |  |
| BPM Management GP SARL |  |

|  |  |
| --- | --- |
|  |  |
| Wholly owned subsidiaries | Note |
| Mauritius |  |
| C/O Rogers Capital Corporate Services  Limited, 3rd Floor, Rogers House, No.5  President John Kennedy Street, Port Louis |  |
| Barclays Capital Mauritius Limited (In Liquidation) |  |
| Barclays Capital Securities Mauritius Limited |  |
|  |  |
| Fifth Floor Ebene Esplanade,  24 Bank Street, Cybercity  72201 Ebene |  |
| Barclays Mauritius Overseas Holdings Limited |  |
|  |  |
| Mexico |  |
| Paseo de la Reforma 505, 41 Floor, Torre  Mayor, Col. Cuauhtemoc, CP 06500 |  |
| Barclays Bank Mexico, S.A. | J, L |
| Barclays Capital Casa de Bolsa, S.A. de C.V. | J, L |
| Grupo Financiero Barclays Mexico, S.A. de C.V. | J, L |
| Servicios Barclays, S.A. de C.V. (In Liquidation) |  |
|  |  |
| Monaco |  |
| 31 Avenue de la Costa, Monte Carlo BP 339 |  |
| Barclays Private Asset Management (Monaco)  S.A.M |  |
|  |  |
| Saudi Arabia |  |
| 3rd Floor Al Dahna Center, 114 Al-Ahsa Street,  PO Box 1454, Riyadh 11431 |  |
| Barclays Saudi Arabia (In Liquidation) |  |
|  |  |
| Singapore |  |
| 10 Marina Boulevard, #25-01 Marina Bay  Financial Centre, Tower 2, 018983 |  |
| Barclays Merchant Bank (Singapore) Ltd. |  |
|  |  |
| Spain |  |
| Calle Jose, Abascal 51, 28003, Madrid |  |
| Barclays Tenedora De Inmuebles SL. |  |
| BVP Galvani Global, S.A.U. |  |
|  |  |
| Switzerland |  |
| Chemin de Grange Canal 18-20, PO Box 3941,  1211, Geneva |  |
| Barclays Bank (Suisse) SA |  |
| Barclays Switzerland Services SA |  |
| BPB Holdings SA |  |
|  |  |
| Taiwan |  |
| 19F-1, No. 7, Xinyi Road, Sec. 5, Taipei,A322,  Taiwan |  |
| Barclays Securities Taiwan Limited |  |
|  |  |
| United States |  |
| Corporation Service Company, 251 Little Falls  Drive, Wilmington, DE 19808 |  |
| Analytical Trade Holdings LLC |  |
| Barclays Asset Backed Depositor LLC | C |
| Barclays Bank Delaware |  |
| Barclays Capital Derivatives Funding LLC | C |

|  |  |
| --- | --- |
|  |  |
| Wholly owned subsidiaries | Note |
| Barclays Capital Energy Inc. |  |
| Barclays Capital Equities Trading GP | B |
| Barclays Capital Holdings Inc. | F, G,  H |
| Barclays Capital Real Estate Finance Inc. |  |
| Barclays Capital Real Estate Holdings Inc. |  |
| Barclays Capital Real Estate Inc. |  |
| Barclays Commercial Mortgage Securities LLC | C |
| Barclays Dryrock Funding LLC | C |
| Barclays Financial LLC | C |
| Barclays Group US Inc. |  |
| Barclays Oversight Management Inc. |  |
| Barclays Receivables LLC | C |
| Barclays Services Corporation |  |
| Barclays Services LLC | C |
| Barclays US CCP Funding LLC | C |
| Barclays US Investments Inc. |  |
| Barclays US LLC |  |
| BCAP LLC | C |
| Gracechurch Services Corporation |  |
| Lagalla Investments LLC |  |
| Long Island Holding A LLC | C |
| Marbury Holdings LLC |  |
| Preferred Liquidity, LLC | I |
| Procella Investments No.2 LLC | C |
| Procella Investments No.3 LLC | C |
| Relative Value Holdings, LLC |  |
| Surrey Funding Corporation |  |
| Sussex Purchasing Corporation |  |
| Sutton Funding LLC | C |
| US Secured Investments LLC | X |
| Verain Investments LLC |  |
| Wilmington Riverfront  LLC | C |
|  |  |
| 100 Bank Street, Suite 630, Burlington,  Vermont 05401 |  |
| Barclays Insurance U.S. Inc. |  |
|  |  |
| Corporation Service Company, 80 State  Street, Albany, NY, 12207-2543 |  |
| Barclays Equity Holdings Inc. |  |
|  |  |
| Corporation Service Company. Goodwin  Square, 225 Asylum Street, 20th Floor Hartford  CT 06103 |  |
| Barclays Capital Inc. |  |
|  |  |
| Corporation Service Company, 2626,  Glenwood Ave, Suite 550, Raleigh, NC, 27608 |  |
| Barclays US GPF Inc. |  |
| Equifirst Corporation (In Liquidation, Dissolved  with State of North Carolina) |  |
|  |  |
| 125 S West Street, Wilmington, DE 19801 |  |
| Curve Investments GP | B |
| Barclays Dryrock Issuance Trust |  |

|  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |
| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 506 |
|  |  |
|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Other disclosure matters | | | | | | | | | | |

Other Related Undertakings

Unless otherwise stated, the undertakings

below are included in the consolidation and

the share capital held by the Group

comprises ordinary and/or common

shares,  which are held by subsidiaries of

Barclays PLC. The percentage of the

nominal value of each share class held by

the Group  is provided below.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Other Related Undertakings | % | Note |
| United Kingdom |  |  |
| 1 Churchill Place, London, E14 5HP |  |  |
| Barclaycard Funding PLC | 100.00 | I |
|  |  |  |
| PSA Credit Company Limited  (In Liquidation) | 100.00 | I |
|  | 100.00 | K |
|  |  |  |
| Barclays Covered Bonds Limited  Liability Partnership | 50.00 | B |
| Barclays Secured Funding (LM)  Limited | 20.00 |  |
|  |  |  |
| St Helen’s, 1 Undershaft, London,  EC3P 3DQ |  |  |
| Igloo Regeneration (General Partner)  Limited | 25.00 | K, U |
|  |  |  |
| 3-5 London Road, Rainham, Kent,  ME8 7RG |  |  |
| Trade Ideas Limited | 20.00 | U |
|  |  |  |
| 50 Lothian Road, Festival Square,  Edinburgh, EH3 9WJ |  |  |
| Equistone Founder Partner II L.P. | 20.00 | B, U |
| Equistone Founder Partner III L.P. | 20.00 | B, U |
|  |  |  |
| Enigma, Wavendon Business Park  Milton Keynes, MK178LX |  |  |
| Intelligent Processing Solutions  Limited | 19.50 | U |
|  |  |  |
| C/O Azets Holdings Limited 5th  Floor, 98 King Street, Manchester,  M2 4WU |  |  |
| Full House Holdings Limited (In  Liquidation) | 67.42 | I, U |
|  |  |  |
| 13-15 York Buildings, London,  WC2N 6JU |  |  |
| BGF Group PLC | 24.62 | I, U |
|  |  |  |
| Unit 9 Westbrook Court,  Sharrowvale Road, Sheffield,  S11 8YZ |  |  |
| Palms Row Healthcare Holdings  Limited | 99.00 | U, CC |
|  |  |  |
| 5th Floor, 44 Great Marlborough  Street,London,W1F 7JL |  |  |
| AVFI TIDE I LP | 37.60 | B, U |
|  |  |  |
| 41 Luke Street, London, EC2A 4DP |  |  |
| Fintech for International Development  Limited (In Liquidation) | 26.37 | I, U |
|  | 100.00 | J |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Other Related Undertakings | % | Note |
| 3rd Floor, 25 Soho  Square,London,W1D 3QR, |  |  |
| Female Innovators Lab LP | 61.00 | B |
|  |  |  |
| 1 America Square, Crosswall,  London, EC3N 2SG |  |  |
| BMC (UK) Ltd | 47.30 | E, I, U |
|  |  |  |
| C/O Cooley (Uk) Llp, 22  Bishopsgate, London, EC2N 4BQ |  |  |
| Barclays Black Formation Investments  I LP | 100.00 | B |
| Barclays Black Formation Investments  II LP | 100.00 | B |
|  |  |  |
| 1-4 Clyde Place, Glasgow, G5 8DP |  |  |
| Buchanan Wharf (Glasgow)  Management Limited | 78.00 | D |
|  |  |  |
| Belgium |  |  |
| Klipperstraat 15 2030 Antwerp |  |  |
| Euphony Benelux NV (In Liquidation) | 20.00 | U |
|  |  |  |
| Cayman Islands |  |  |
| Maples Corporate Services Limited,  PO Box 309GT, Ugland House, South  Church Street, Grand Cayman,  KY1-1104 |  |  |
| Cupric Canyon Capital GP Limited | 50.00 | U |
| Cupric Canyon Capital LP | 42.17 | I, U |
| Newman Holdings Limited (In  Liquidation) | 80.60 | I, U |
| Southern Peaks Mining LP | 54.40 | B, U |
| SPM GP Limited | 90.00 | U |
|  |  |  |
| Korea, Republic of |  |  |
| 18th Floor, Daishin Finance Centre,  343, Samil-daero, Jung-go, Seoul |  |  |
| Woori BC Pegasus Securitization  Specialty Co. Ltd | 70.00 | AA |
|  |  |  |
| Luxembourg |  |  |
| 9, allee Scheffer, L-2520 |  |  |
| Barclays Alzin Investments S.à r.l. | 100.00 | R |
| Barclays Bordang Investments S.à r.l. | 100.00 | S |
| Barclays Lamorak Investments S.à r.l. | 100.00 | F,Q |
| Preferred Funding S.à r.l. | 100.00 | W |
| Preferred Investments S.à r.l. | 100.00 | H, W |
|  |  |  |
| Malta |  |  |
| RS2 Buildings, Fort Road, Mosta MST  1859 |  |  |
| RS2 Software PLC | 18.14 | U |
|  |  |  |
| Netherlands |  |  |
| Alexanderstraat 18, The Hague,  2514 JM, Zuid-Holland |  |  |
| Tulip Oil Holding BV | 34.50 | I, U |
|  | 23.00 | K |

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Other Related Undertakings | % | Note |
| Sweden |  |  |
| c/o ForeningsSparbanken AB 105 34  Stockholm |  |  |
| EnterCard Group AB | 100.00 | J, U |
|  |  |  |
| United States |  |  |
| Corporation Services Company, 251  Little Falls, Drive Wilmington, DE  19808 |  |  |
| DG Solar Lessee, LLC | 75.00 | C, U |
|  |  |  |
| Corporation Trust Company,  Corporation Trust Centre, 1209  Orange Street, Wilmington DE  19801 |  |  |
| DG Solar Lessee II, LLC | 75.00 | C, U |
| VS BC Solar Lessee I LLC | 50.00 | C, U |
|  |  |  |
| 1415 Louisiana Street, Suite 1600,  TX 77002-0000 |  |  |
| Sabine Oil & Gas Holdings, Inc.(In  Liquidation) | 22.12 | U |

Joint Ventures

The related undertaking below is dealt with

as a Joint Venture  in accordance with s.

18, Schedule 4, The Large and Medium-

sized Companies and Groups (Accounts

and Reports) Regulations 2008 and is

proportionally consolidated. The

proportion of the capital of the related

undertaking held by the Group is stated

below.

|  |  |  |
| --- | --- | --- |
|  |  |  |
| Joint Venture | % | Note |
| United Kingdom |  |  |
| Vaultex UK Limited | 50.00 |  |

Joint management factors

The Board of Directors of the above Joint

Venture  comprises two Barclays

representative Directors, two JV partner

Directors and three non-JV partner

Directors. The Board of Directors  are

responsible for setting the Company

strategy and budgets.

The last financial year of the above JV

ended on 6 October 2023 and the average

number of monthly employees reported in

the accounts was 1,216.

.

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| Notes to the financial statements (continued) | | | | | | | | | | |
| Other disclosure matters | | | | | | | | | | |

Notes

The terms Barclays or Group refer to Barclays PLC

together with its subsidiaries. Unless otherwise stated, the

income statement analysis compares the year ended 31

December 2023 to the corresponding twelve months of

2022 and balance sheet analysis as at 31 December 2023

with comparatives relating to 31 December 2022. The

abbreviations ‘£m’ and ‘£bn’ represent millions and

thousands of millions of Pounds Sterling respectively; the

abbreviations ‘$m’ and ‘$bn’ represent millions and

thousands of millions of US Dollars respectively; and the

abbreviations ‘€m’ and ‘€bn’ represent millions and

thousands of millions of Euros respectively.

There are a number of key judgement areas, for example

impairment calculations, which are based on models and

which are subject to ongoing adjustment and modifications.

Reported numbers reflect best estimates and judgements

at the given point in time.

Relevant terms that are used in this document but are not

defined under applicable regulatory guidance or

International Financial Reporting Standards (IFRS) are

explained in the results glossary that can be accessed at

home.barclays/ investor-relations/reports-and-events/

latest-financial-results.

These results will be filed on a Form 20-F with the US

Securities and Exchange Commission (SEC) as soon as

practicable following their publication. Once filed with the

SEC, a copy of the Form 20-F will be available from the

Barclays Investor Relations website at home.barclays/

annualreport and from the SEC’s website at sec.gov.

Barclays is a frequent issuer in the debt capital markets and

regularly meets with investors via formal road-shows and

other ad hoc meetings. Consistent with its usual practice,

Barclays expects that from time to time over the coming

quarter it will meet with investors globally to discuss these

results and other matters relating to the Group.

Non-IFRS performance measures

Barclays’ management believes that the non-IFRS

performance measures included in this document provide

valuable information to the readers of the financial

statements as they enable the reader to identify a more

consistent basis for comparing the businesses’

performance between financial periods and provide more

detail concerning the elements of performance which the

managers of these businesses are most directly able to

influence or are relevant for an assessment of the Group.

They also reflect an important aspect of the way in which

operating targets are defined and performance is

monitored by Barclays’ management. However, any non-

IFRS performance measures in this document are not a

substitute for IFRS measures and readers should consider

the IFRS measures as well. Refer to pages [387](#i4be61753b7f243b19551b0bfbf3a2a0d_853) to [393](#if8d9fdc0ce9945ddb066fd1f4b5d0f0d_362) for

further information and calculations of non-IFRS

performance measures included throughout this

document, and the most directly comparable IFRS

measures.

Forward-looking statements

This document contains certain forward-looking

statements within the meaning of Section 21E of the US

Securities Exchange Act of 1934, as amended, and Section

27A of the US Securities Act of 1933, as amended, with

respect to the Group. Barclays cautions readers that no

forward-looking statement is a guarantee of future

performance and that actual results or other financial

condition or performance measures could differ materially

from those contained in the forward-looking statements.

Forward-looking statements can be identified by the fact

that they do not relate only to historical or current facts.

Forward-looking statements sometimes use words such as

‘may’, ‘will’, ‘seek’, ‘continue’, ‘aim’, ‘anticipate’, ‘target’,

‘projected’, ‘expect’, ‘estimate’, ‘intend’, ‘plan’, ‘goal’,

‘believe’, ‘achieve’ or other words of similar meaning.

Forward-looking statements can be made in writing but

also may be made verbally by directors, officers and

employees of the Group (including during management

presentations) in connection with this document. Examples

of forward-looking statements include, among others,

statements or guidance regarding or relating to the

Group’s future financial position, business strategy, income

levels, costs, assets and liabilities, impairment charges,

provisions, capital leverage and other regulatory ratios,

capital distributions (including policy on dividends and share

buybacks), return on tangible equity, projected levels of

growth in banking and financial markets, industry trends,

any commitments and targets (including environmental,

social and governance (ESG) commitments and targets),

plans and objectives for future operations and other

statements that are not historical or current facts. By their

nature, forward-looking statements involve risk and

uncertainty because they relate to future events and

circumstances. Forward-looking statements speak only as

at the date on which they are made. Forward-looking

statements may be affected by a number of factors,

including, without limitation: changes in legislation,

regulations, governmental and regulatory policies,

expectations and actions, voluntary codes of practices and

the interpretation thereof, changes in International

Financial Reporting Standards and other accounting

standards, including practices with regard to the

interpretation and application thereof and emerging and

developing ESG reporting standards; the outcome of

current and future legal proceedings and regulatory

investigations; the Group’s ability along with governments

and other stakeholders to measure, manage and mitigate

the impacts of climate change effectively; environmental,

social and geopolitical risks and incidents, pandemics and

similar events beyond the Group’s control; the impact of

competition in the banking and financial services industry;

capital, liquidity, leverage and other regulatory rules and

requirements applicable to past, current and future periods;

UK, US, Eurozone and global macroeconomic and business

conditions, including inflation; volatility in credit and capital

markets; market related risks such as changes in interest

rates and foreign exchange rates; reforms to benchmark

interest rates and indices; higher or lower asset valuations;

changes in credit ratings of any entity within the Group or

any securities issued by it; changes in counterparty risk;

changes in consumer behaviour; the direct and indirect

consequences of the conflicts in Ukraine and the Middle

East on European and global macroeconomic conditions,

political stability and financial markets; political elections;

developments in the UK’s relationship with the European

Union (EU); the risk of cyberattacks, information or security

breaches, technology failures or other operational

disruptions and any subsequent impacts on the Group’s

reputation, business or operations; the Group’s ability to

access funding; and the success of acquisitions, disposals

and other strategic transactions. A number of these factors

are beyond the Group’s control. As a result, the Group’s

actual financial position, results, financial and non-financial

metrics or performance measures or its ability to meet

commitments and targets may differ materially from the

statements or guidance set forth in the Group’s forward-

looking statements. In setting its targets and outlook for

the period 2024-2026, Barclays has made certain

assumptions about the macro-economic environment,

including, without limitation, inflation, interest and

unemployment rates, the different markets and

competitive conditions in which Barclays operates, and its

ability to grow certain businesses and achieve costs savings

and other structural actions. Additional risks and factors

which may impact the Group’s future financial condition

and performance are identified in the description of

material existing and emerging risks beginning on page [258](#i2207833d992a41c98da57124d8d2efb7_761)

of this Annual Report.

Subject to Barclays PLC’s obligations under the applicable

laws and regulations of any relevant jurisdiction (including,

without limitation, the UK and the US) in relation to

disclosure and ongoing information, we undertake no

obligation to update publicly or revise any forward-looking

statements, whether as a result of new information, future

events or otherwise.

This document is printed on Revive 100 Offset, made from

100% FSC® Recycled certified fibre sourced from de-inked

post-consumer waste. The printer and the manufacturing

mill are both credited with ISO 14001 Environmental

Management Systems Standard and both are FSC®

certified. The mill also holds EMAS, the EU Eco-label. Revive

100 Offset is a Carbon balanced paper which means that

the carbon emissions associated with its manufacture have

been measured and offset using the World Land Trust’s

Carbon Balanced scheme.

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| Strategic  report | Shareholder  information | Climate and  sustainability report | Governance | Risk  review | Financial  review |  | Financial  statements |  | Barclays PLC  Annual Report 2023 | 508 |
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|  |  |  |  |  |  |  |  |  |  |  |
| Notes to the financial statements (continued) | | | | | | | | | | |
| Other disclosure matters | | | | | | | | | | |

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|  |  | Our 2023 suite of Reports |  |  |  |  |  |  |
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|  |  | Barclays PLC Annual Report 2023  A detailed review of Barclays’ 2023  performance with disclosures that provide  useful insight and go beyond reporting  requirements. The 2022 report integrates  our ESG (Environmental, Social and  Governance), and DEI (Diversity, Equity and  Inclusion)  reporting, and incorporates our  Task Force on Climate-related Financial  Disclosures (TCFD) recommendations in  this, the sixth year of disclosure. |  | Barclays PLC Pillar 3 Report 2023  A summary of our risk profile, its interaction  with the Group’s risk appetite, and risk  management.  Barclays PLC Fair Pay Report 2023  An overview of our approach to pay, including  the principles and policies of our Fair Pay  agenda. |  | Barclays PLC Country Snapshot 2023  An overview of our global tax contribution  as well as our approach to tax, including  our UK tax strategy, together with our  country-by-country data. |  |  |
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