Barclays Plc · LSE:BARC
Barclays — IPO Roadshow (June 2015)
53 slides from Barclays's IPO roadshow presentation, Jun 1, 2015
Slide 1: Barclays PLC Fixed Income Investor Presentation
Free Writing Prospectus Filed Pursuant to Rule 433 Reg. Statement No. 333-195645 Barclays PLC Fixed Income Investor Presentation Q1 2015 Interim Management Statement 29 April 2015
Slide 2: Q1 financial highlights
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Q1 financial highlights Increased adjusted pre-tax profits by 9% – Core up 14% Core business continued to performed well with PBT of £2.1bn and RoE of 10.9% Further progress on
Slide 3: Performance Overview
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Performance Overview
Slide 4: Summary Group financials: Adjusted profits up 9%
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Summary Group financials: Adjusted profits up 9% Three months ended – March (£m) 2014 2015 % change Financial performance Income 6,650 6,430 (3%) • Adjusted profit before tax i
Slide 5: Strengthening key financial metrics
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Strengthening key financial metrics (£bn) Dec-14 Mar-15 Highlights Total assets • Progressive strengthening of key balance sheet metrics 1,358 1,416 Balance • CET1 capital has
Slide 6: Core business performing well: Positive jaws and PBT up 14%
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Core business performing well: Positive jaws and PBT up 14% Three months ended – March (£m) 2014 2015 % change Financial performance Income 6,277 6,420 2% • PBT up 14% at £2.1b
Slide 7: Barclays Non-Core: Continued shrinkage and capital recycling
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Barclays Non-Core: Continued shrinkage and capital recycling Three months ended – March (£m) 2014 2015 Highlights – Businesses 301 122 • Period end equity reduced by £5.2bn to
Slide 8: Capital & Leverage
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Capital & Leverage
Slide 9: Continued progress on CET1 ratio despite adjusting items
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Continued progress on CET1 ratio despite adjusting items Fully loaded (FL) CRD IV CET1 ratio progression 1 RWA reduction (£bn)1 CET1 40 41 42 Capital +30bps (1%) >11% 442 10.3%
Slide 10: RWAs: Closely managed to support business growth and capital ratio accretion
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING RWAs: Closely managed to support business growth and capital ratio accretion RWAs (£bn) Highlights • RWAs reduced by £6bn reflecting continued progress on the run-down of Non-C
Slide 11: Barclays Non-Core: Further RWA reduction
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Barclays Non-Core: Further RWA reduction RWA reduction bridge (£bn) Leverage exposure by type (£bn) 1 Operational risk Securities and loans Derivatives Businesses Businesses Se
Slide 12: Continued progress on the transition towards our 'target' end-state capital structure
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Continued progress on the transition towards our ‘target’ end-state capital structure Evolution of capital structure Fully loaded CRD IV capital position • Fully loaded CRD IV
Slide 13: We intend to manage our CET1 capital ratio to mitigate against the risk of mandatory distribution restrictions
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING We intend to manage our CET1 capital ratio to mitigate against the risk of mandatory distribution restrictions CET1 requirements 1 (as at 1 January except Q115) • Mandatory res
Slide 14: Leverage ratio on track for 2016 target
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Leverage ratio on track for 2016 target Leverage ratio progression 1 Leverage exposure (£trn) 1 T1 41 46 46 BCBS 270 Capital impact 1.36 1.35 >4% 3.7% 3.7% 1.26 1.23 3.0% Dec-1
Slide 15: Leverage ratio maintained at 3.7%
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Leverage ratio maintained at 3.7% Leverage exposure 1 (£bn) Highlights L&A and other assets 2 Derivatives • Leverage exposures during Q1 15 increased by £22bn to £1,255bn SFTs
Slide 16: Holding company transition
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Holding company transition
Slide 17: Better aligning credit proposition during transition towards a holding company model
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Better aligning credit proposition during transition towards a holding company capital and funding model Expected creditor hierarchy during transition¹ Barclays position • Barc
Slide 18: Barclays PLC parent company accounts
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Barclays PLC parent company accounts Barclays PLC parent company balance sheet Notes Balance sheet • Barclays PLC is the holding company (HoldCo) of the 2014 Q1 15 Barclays Gro
Slide 19: Proxy Total Loss Absorbing Capacity (TLAC)
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Proxy Total Loss Absorbing Capacity (TLAC) 1 (£bn) Mar-15 • Proactive transition towards a HoldCo funding and capital model positions us well to meet potential future TLAC PRA
Slide 20: Liquidity & Funding
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Liquidity & Funding
Slide 21: Maintaining a robust liquidity position
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Maintaining a robust liquidity position, with pool well in excess of internal and external minimum requirements High quality liquidity pool (£bn) Key messages Cash & Deposits a
Slide 22: Stable and diverse sources of funding
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING We maintain access to stable and diverse sources of funding, across customer deposits and wholesale debt Broadly self-funded retail businesses 1 (£bn) Key messages 91% • Group
Slide 23: Wholesale funding maturity and composition
PERFORMANCE CAPITAL HOLDING LIQUIDITY ASSET CREDIT Continue APPENDIX Wholesale Key Overall 82bn 4bn $3bn 1bn We debt Depostis 7% 16% 12% 26% 13% > 27% 10% 21% 8% By As 1 gold 23month Given 3|at 6 9 1 2 5 remaining currency1 have mth mths year years years2 10% 4% Barclays of messages and (5bn) 3% 14%
Slide 24: Asset quality
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Asset quality
Slide 25: Credit impairment charges
PERFORMANCE CAPITAL OVERVIEW Continued Credit PCB Barclaycard Africa 481 7% Personal Impairment 41% 79 135 Q1 25 |269 14 Barclays 448 (8%) benefitted Q1 impairment Banking 290 and 15 6% & strong 96 charge (m) impairment LEVERAGE Corporate Q1 TRANSITION 90 from impairment 14 2015 asset improved HOLDI
Slide 26: Group impairment stable (31 December 2014)
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Group impairment stable (31 December 2014) Retail loan loss rate (bps) Highlights Dec-13 Dec-14 • Declining Loan Loss Rate (LLR) trend 332 308 across the Group reflecting Barcl
Slide 27: Eurozone periphery exposures
PERFORMANCE CAPITAL OVERVIEW Reduced Spain 4.9 59.0 7.9 22.7 23.5 18.0 20.6 Exposures Sovereign Residential 6.3 59.2 5.9 32.5 2.6 5.4 9.3 4.3 2012 1 Key The ECB Portugal: We 27Net | 5.7 52.8 6.7 4.8 53.1 43.2 continue Barclays vast Messages 4.8 19.2 31.4 LTRO 2013 on Italy 43.2 6.5 majority balance
Slide 28: Risk: stress tests and oil and gas exposure
Risk –on stress Managing makes Total tests up Minimising and c.90% sector Barclays off balance of exposures potential limits passed sheet inboth (bn) oil headwinds | 28 and (as the| Barclays gas at PRA31Passing Total December andQ1net EBA stress 2015 exposure stress 2014) tests Fixed tests of 1– Inc
Slide 29: Credit ratings
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Credit ratings
Slide 30: Credit ratings and potential actions
PERFORMANCE CAPITAL Standalone AT1 Senior T2 UT2 LT2 Tier Industry bank Rating watch YTD BB B by of 17 affirmed Next potential Barclays notches, criteria Action Capacity” implement expected Recent Reassessment Ratings credit No Expected 1 differ announcements. 30Definitions PLC’s “loss 1CoCos Mar Ba
Slide 31: Managing and reserving for potential rating actions in the liquidity pool
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Barclays manages and reserves for potential rating actions in the liquidity pool (31 December 2014) Key Messages Contractual credit rating downgrade exposure Contractual outflo
Slide 32: Summary
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Summary • Diversified international bank focused on delivering improved and more sustainable returns Business model • Concentrating on high growth opportunities where we have c
Slide 33: Appendix
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Appendix
Slide 34: Repositioning and simplifying Barclays
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Repositioning and simplifying Barclays Rightsizing and focusing the Investment Bank Establishing a dedicated Non-Core unit and a new Personal and Corporate Banking business All
Slide 35: 2016 Transform targets
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING 2016 Transform targets 2016 Target Q1 2015 Capital CRD IV FL CET1 ratio >11.0% 10.6% Group Leverage Leverage ratio >4.0% 3.7% Dividend Payout ratio 40-50% 1p 1 Returns Adjusted
Slide 36: Simpler, focused and balanced structure
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Simpler, focused and balanced structure Barclays Group Personal and Africa Investment Barclaycard Barclays Non-Core Corporate Banking Banking Bank PBT £787m PBT £366m PBT £295m
Slide 37: Reducing and reallocating RWAs to drive growth and returns
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING <15% Reducing and reallocating RWAs to drive growth and returns 2013 pre-resegmentation (£bn) 2013 post-resegmentation estimate (£bn) 2016 guidance (£bn) Leverage exposure £1.4
Slide 38: Core Investment Bank: Building on competitive advantages
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Core Investment Bank: Building on competitive advantages Core Investment Bank Non-Core Investment Bank RWAs: c.£120bn RWAs: c.£90bn Leverage exposure: c.£490bn Leverage exposur
Slide 39: PCB: Profits up 14%
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING PCB: Profits up 14% Three months ended – March (£m) 2014 2015 % change Financial performance – Personal 1,026 1,009 (2%) • Income was in line at £2,174m: – Corporate 8
Slide 40: Barclaycard: Income up 9% and RoE of nearly 17%
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Barclaycard: Income up 9% and RoE of nearly 17% Three months ended – March (£m) 2014 2015 % change Financial performance Income 1,042 1,135 9% • Income increased 9% to £1,135m
Slide 41: Africa Banking: Profits up 23%
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Africa Banking: Profits up 23% Three months ended – March (£m) 2014 2015 % change Financial performance 1 Income 878 948 8% Currency movements had a limited effect on Q1 year o
Slide 42: Investment Bank: Profits up 37%
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Investment Bank: Profits up 37% Three months ended – March (£m) 2014 2015 % change Q4 14 % change Banking 616 632 3% 638 (1)% Markets 1,489 1,517 2% 1,028 48% – Credit 346 274
Slide 43: Core income: growth in net interest income and margin
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Core income: growth in net interest income and margin Core income (£m) Total income NII • Improved performance in income across all businesses Three months ended – March 2014 2
Slide 44: Group and Core cost targets
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Group and Core cost targets Group cost guidance 1 (£bn) Core cost target 1 (£bn) 18.7 Original Guidance = £17.5bn Revised Guidance = £17bn 16.9 c.16.3 16.4 15.1 <14.5 FY13 FY14
Slide 45: Core operating expenses
PERFORMANCE CAPITAL Staff 4.0 0.2 1.2 2.5 Core Highlights initiatives driven Personal Operating 3% 1.36 Q1 1 45Totals |14 2% 0.1 1.3 2.4 (18%) Barclays 1.31 costs operating Q1 by 3.9 inand 0.42 front continued 15 costs (3%) & Other graph LEVERAGE Corporate Q10.49 costs expenses1 expenses office (bn)
Slide 46: Investment Bank: Downward trend in compensation charge
PERFORMANCE CAPITAL & HOLDING COMPANY LIQUIDITY & ASSET QUALITY CREDIT RATING APPENDIX OVERVIEW LEVERAGE TRANSITION FUNDING Investment Bank: Downward trend in compensation charge (31 December 2014) Investment Bank operating expenses (£m) Investment Bank – Compensation actions 6,598 • Headcount down
Slide 47: Wholesale funding composition
PERFORMANCE CAPITAL Wholesale >1 As months Barclays Deposits Certificates commercial Asset (public Senior (private Covered Subordinated Other3 Total 1 include swaps, which within 47The |month atBarclays 21.9 as 31 backed composition matures one unsecured including 2.1 benchmark) collateral months pl
Slide 48: Bail-in and resolution considerations
PERFORMANCE CAPITAL In Overview European Statutory recognition UK Certain receive Considerations Under tenor are eligible laws, instruments 48 line |„excluded Banking resolution Barclays greater aDepositor with provision no liabilities bail-in “bail-in” Bank & less by the relative Act: than LEVERAGE
Slide 49: Contact – Debt Investor Relations Team
Contact – Debt Investor Relations Team Lisa Bartrip Sofia Lonnqvist Dan Colvin +44 (0)20 7773 0708 +44 (0)20 7116 5716 +44 (0)20 7116 6533 lisa.bartrip@barclays.com sofia.lonnqvist@barclays.com daniel.colvin@barclays.com Website: barclays.com/barclays-investor-relations.html 49 | Barclays Q1 2015 Fi
Slide 50: Legal Disclaimer
Legal Disclaimer Important Notice The information, statements and opinions contained in this document do not constitute a public offer under any applicable legislation or an offer to sell or solicitation of any offer to buy any securities or financial instruments or any advice or recommendation with
Slide 51: Disclaimer (continued)
Disclaimer (continued) Barclays has filed a registration statement (including a prospectus) and has filed, or will file, a prospectus supplement with the U.S. Securities and Exchange Commission (“SEC”) for the offering of securities to which this document relates. Before you invest, you should read
Slide 52: Disclaimer (continued)
Disclaimer (continued) • Adjusted total operating expenses represents operating expenses excluding the provisions for PPI redress; provision for investigations and litigation primarily relating to Foreign Exchange; and gain on valuation of a component of the defined retirement benefit liability. A r
Slide 53: Disclaimer (continued)
Disclaimer (continued) • Liquidity Coverage Ratio (LCR) is calculated according to the Commission Delegated Regulation of October 2014 that supplements Regulation (EU) 575/2013 (CRDIV) published by the European Commission in June 2013. The metric is a ratio that is not yet fully implemented in local