Slide 1: Group Strategy Update
Barclays PLC Group Strategy Update Building Barclays as the ‘Go-To’ bank 8 May 2014
Slide 2: Repositioning and simplifying Barclays
GROUP CORE NON-CORE CONCLUSION Repositioning and simplifying Barclays Rightsizing and focusing the Investment Bank Establishing a dedicated non-core unit and a new Personal & Corporate Banking business Allocating capital to growth businesses Delivering a structurally lower cost base Generating highe
Slide 3: Rebalancing the Group to improve returns
GROUP CORE NON-CORE CONCLUSION Rebalancing the Group to improve returns Regulatory landscape shifted significantly IB - overweight FICC Group - overweight IB • Increasing capital requirements • Accelerated timetable for leverage FICC2 as % of IB as % FY 20131 FY 20132 total IB of Group requirements
Slide 4: A focused international bank delivering improved, sustainable returns and growth
GROUP CORE NON-CORE CONCLUSION A focused international bank delivering improved, sustainable returns and growth Playing to our Focusing on high Eliminating marginal or Relentlessly focusing existing strengths growth businesses declining businesses on costs • Grow our large, • Reallocate capital towa
Slide 5: Reorganising to a simpler, more focused and balanced structure
GROUP CORE NON-CORE CONCLUSION Reorganising to a simpler, more focused and balanced structure Barclays Group Personal & Africa Investment Barclays Non-Core Barclaycard Corporate Banking Banking Bank (BNC) RWAs c.£120bn RWAs c.£35bn RWAs c.£40bn RWAs c.£120bn RWAs c.£115bn 20131 FY Leverage c.£330bn
Slide 6: Personal & Corporate Banking: Established scale franchise, anchored from the UK
GROUP CORE NON-CORE CONCLUSION Personal & Corporate Banking: Established scale franchise, anchored from the UK Preliminary Highlights FY 20131 (£bn) • Combining strong UK market positions with international Income 8.8 Corporate and Wealth franchises covering larger clients: − 15 million retail custo
Slide 7: Barclaycard: High returning business, with strong growth opportunity
GROUP CORE NON-CORE CONCLUSION Barclaycard: High returning business, with strong growth opportunity Preliminary Highlights FY 20131 (£bn) • Consistent delivery of growth at high returns across consumer Income 4.1 payments businesses in five markets – with Absa Card now included in Africa Banking Imp
Slide 8: Africa Banking: Longer term growth, with competitive advantage in many countries
GROUP CORE NON-CORE CONCLUSION Africa Banking: Longer term growth, with competitive advantage in many countries Preliminary Highlights FY 20131 (£bn) • 12 countries with a network of more than 1,400 branches and Income 4.0 over 10,900 ATMs • More than 45,000 employees and over 12 million customers I
Slide 9: Core Investment Bank
GROUP CORE NON-CORE CONCLUSION Core Investment Bank Barclays Group Personal & Africa Investment Barclays Non-Core Barclaycard Corporate Banking Banking Bank (BNC) RWAs c.£120bn RWAs c.£35bn RWAs c.£40bn RWAs c.£120bn RWAs c.£115bn 20131 FY Leverage c.£330bn Leverage c.£45bn Leverage c.£65bn Leverage
Slide 10: Core Investment Bank: Building on competitive advantages
GROUP CORE NON-CORE CONCLUSION Core Investment Bank: Building on competitive advantages Core Investment Bank Non-core Investment Bank RWAs: c.£120bn RWAs: c.£90bn 20131 FY Leverage exposure: c.£490bn Leverage exposure: c.£340bn Global Equities Global Credit Right-sized Macro Markets • Exit Quadrant
Slide 11: Capitalising on strength of existing client franchise
GROUP CORE NON-CORE CONCLUSION Capitalising on strength of existing client franchise Our two home markets represent largest Where we have strong market positions Focusing on smaller number of key clients investment banking revenue pools Global revenue pools by region1 • Target top three fee share wi
Slide 12: Rescaling the Investment Bank enables greater balance
GROUP CORE NON-CORE CONCLUSION Rescaling the Investment Bank enables greater balance Balance Sheet – FY 2013 and FY 2016 P&L – FY 2013 Total Group (100%) 53% 46% c.£844bn £222bn 11% 50% 19% £2.8bn £10.7bn c.£2.5bn c.£400bn1 c.£120bn c.£8.7bn c.60% c.35% c.50% ≤30% 38% c.30% 44% c.40% Leverage exposu
Slide 13: Focus on Barclays Non-Core
GROUP CORE NON-CORE CONCLUSION Focus on Barclays Non-Core Barclays Group Personal & Africa Investment Barclays Non-Core Barclaycard Corporate Banking Banking Bank (BNC) RWAs c.£120bn RWAs c.£35bn RWAs c.£40bn RWAs c.£120bn RWAs c.£115bn 20131 FY Leverage c.£330bn Leverage c.£45bn Leverage c.£65bn Le
Slide 14: Structural cost reduction being achieved
GROUP CORE NON-CORE CONCLUSION Structural cost reduction being achieved Group cost guidance1 (£bn) Core cost targets1 (£bn) Original Group cost target and interim guidance Revised Group cost guidance Core cost targets 19 18.7 c.(9%) c.(13%) 19 18 18 c.(10%) c.17 17 c.16.3 17 c.16.2 16 16 17.5 15 16.
Slide 15: Accelerated CTA to increase 2014 headcount reduction
GROUP CORE NON-CORE CONCLUSION Accelerated CTA to increase 2014 headcount reduction Estimated £1.6bn of CTA with increase in gross headcount reduction to c.14,000 for 2014 Front Office and Distribution reductions • Savings driven by branch network transformation across UK, Europe and Africa • Front
Slide 16: Allocated capital will reflect greater balance of the Group
GROUP CORE NON-CORE CONCLUSION <15% Allocated capital will reflect greater balance of the Group FY 13 pre-resegmentation (£bn) FY 13 post-resegmentation estimate (£bn) FY 16 guidance (£bn) Leverage exposure £1.4tn £1.4tn c.£1.1tn1 RWAs £436bn £436bn c.£400bn c.55% BNC BNC 26% <15% Retail and c.115 c
Slide 17: Core businesses expected to maintain average adjusted RoE >12% on a much higher equity base
GROUP CORE NON-CORE CONCLUSION Core businesses expected to maintain average adjusted RoE >12% on a much higher equity base % Core c.12 >12 Non-core c.3 c.9-10 drag <3% c.6 6.1 4.5 1.6 Group >9% 3.5 1.0 2013 Adjusting 2013 CTA 2013 Non-core 2013 2013-16 Proforma Income growth/ 2016 Core Statutory RoE
Slide 18: Rebalanced Barclays – a preliminary snapshot of FY 2013
GROUP CORE NON-CORE CONCLUSION Rebalanced Barclays – a preliminary snapshot of FY 2013 Barclays Group Highlights: Core business Core BNC Preliminary FY 20131 (£bn) • Over 90% of income and improved profit before tax Income 28.2 25.7 2.5 • Strong returns already generated with adjusted RoE1 of c.12%
Slide 19: 2016 Transform financial commitments
GROUP CORE NON-CORE CONCLUSION 2016 Transform financial commitments 1 Capital CRD IV FL CET1 ratio >11.0% Group 2 Leverage Leverage ratio >4.0% 3 Dividend Payout ratio 40-50% 4 Returns Adjusted RoE >12% Barclays Core 5 Cost Adjusted operating expenses <£14.5bn Barclays Non-Core 6 Returns Drag on adj
Slide 20: Core Investment Bank and Barclays Non-Core
Core Investment Bank and Barclays Non-Core
Slide 21: Investment Bank: Preliminary 2013 core Investment Bank financials
GROUP CORE NON-CORE CONCLUSION Investment Bank: Preliminary 2013 core Investment Bank financials Preliminary Highlights FY 20131 (£bn) • Core Investment Bank being run with returns focus: Banking income 2.1 − Build on competitive advantage of having dual US and UK Markets income 6.6 home markets Mac
Slide 22: Barclays Non-Core: Run-down will be a critical element of Transform
GROUP CORE NON-CORE CONCLUSION Barclays Non-Core: Run-down will be a critical element of Transform ` Preliminary Overview FY 20131 (£bn) • Income primarily driven by Investment Bank Markets Income 2.5 businesses and net interest income on European mortgages • Impairment principally related to Europe
Slide 23: Rigorous discipline is being applied to non-core
GROUP CORE NON-CORE CONCLUSION Rigorous discipline is being applied to non-core Composition of BNC Selection criteria and components Approximate split of FY 2013 RWAs (£bn) • Strategic attractiveness − Limited growth opportunities for Barclays Non-core IB Europe retail Non-core Corporate Additional
Slide 24: Investment Bank assets are majority of non-core
GROUP CORE NON-CORE CONCLUSION Investment Bank assets are majority of non-core Portfolios and businesses included: included Income RWAs Preliminary FY 13 Split of FY 2013 (£m) (£bn) Non-strategic RWAs (£bn) businesses Portfolio and Other Assets Book Portfolio Assets Book 142 24 c.10 Pre-CRD IV Rates
Slide 25: Selected corporate, retail and other assets constitute remainder of non-core
GROUP CORE NON-CORE CONCLUSION Selected corporate, retail and other assets constitute remainder of non-core Portfolios and businesses included: Income RWAs Preliminary FY 13 (£m) (£bn) Split of FY13 CRD IV RWAs Other retail assets Europe Retail Europe retail Exit Quadrant 118 9 Exit Quadrant Fair va
Slide 26: Non-core will be tightly managed to reduce RWAs and leverage
GROUP CORE NON-CORE CONCLUSION Non-core will be tightly managed to reduce RWAs and leverage Anticipated RWA reduction of c.55% by 2016 (£bn) Anticipated reduction in leverage exposure of c.55% by 2016 (£bn) c.400 c.55% c.115 c.55% Non-IB 25 c.300 c.80 c.50 c.1801 IB 90 2013 2014 2016 2013 2014 2016
Slide 27: Preliminary adjusted results FY 2013
GROUP CORE NON-CORE CONCLUSION Preliminary adjusted results FY 2013 Personal & Core Preliminary FY 2013 Africa Barclays Total Corporate Barclaycard Investment BNC (£bn) 1 Banking Core3 Group Banking Bank Income 8.8 4.1 4.0 8.7 25.7 2.5 28.2 Impairment (0.6) (1.1) (0.5) 0 (2.2) (0.9) (3.1) Operating
Slide 28: Conclusion
Conclusion
Slide 29: 2016 Transform financial commitments
GROUP CORE NON-CORE CONCLUSION 2016 Transform financial commitments 1 Capital CRD IV FL CET1 ratio >11.0% Group 2 Leverage Leverage ratio >4.0% 3 Dividend Payout ratio 40-50% 4 Returns Adjusted RoE >12% Core 5 Cost Adjusted operating expenses <£14.5bn Barclays Non-Core 6 Returns Drag on adjusted RoE
Slide 30: Q&A
Q&A
Slide 31: Important Notice
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 respect to such
Slide 32: Exchange Offer (continued)
Exchange Offer (continued) This document must be read in conjunction with the prospectus. No offer or invitation to acquire or exchange any securities is being made pursuant to this document. This document and the prospectus contain important information, which must be read carefully before any deci
Slide 33: Forward-looking statements
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 certain of the Barclays PLC‟s and its subsidiari