bbi-2022-12-31-en

The Strategic Report was approved by the Board of Directors on 15 March 2023.

OVERVIEW

Barclays Bank Ireland PLC (the ‘Bank’, ‘BBI’ or the ‘Company’) is a wholly owned subsidiary of Barclays Bank PLC (‘BB PLC’). BB PLC is a

wholly owned subsidiary of Barclays PLC (‘B PLC’). The consolidation of B PLC and its subsidiaries is referred to as the Barclays Group. The

term Barclays refers to either B PLC or, depending on the context, the Barclays Group as a whole.

The Bank is licensed as a credit institution by the Central Bank of Ireland (‘CBI’) and is designated as a significant institution, directly

supervised by the Single Supervisory Mechanism (‘SSM’) of the European Central Bank (‘ECB’). The Bank is regulated by the CBI for

financial conduct and the Bank’s branches are also subject to direct supervision for local conduct purposes by national supervisory

authorities in the jurisdictions where they are established.

The Bank has issued debt securities listed on regulated European markets and as a result, the Bank has prepared and published this Annual

Report in accordance with the requirements for periodic financial information under the Transparency (Directive 2004/109/EC)

Regulations 2007, as amended, which apply to the Bank.

The Bank is the primary legal entity within the Barclays Group serving Barclays European Economic Area (‘EEA’) clients, with branches in

Belgium, France, Germany, Italy, Luxembourg, the Netherlands, Portugal, Spain and Sweden, in addition to its Irish Head Office.

In July 2022, the Bank completed an ECB Comprehensive Assessment (‘CA’) comprising an asset quality review and stress test. The CA

represents the entrance exam to supervision by the ECB's SSM, which the Bank entered in 2019. The ECB determined on the basis of the CA

that the Bank did not need any additional capital. The ECB also factors the outcome and any findings of the CA into the ongoing

assessment of banks’ risks, their governance arrangements and their capital and liquidity situation as part of the Supervisory Review and

Evaluation Process (‘SREP’).

OUR STRUCTURE

The Bank has two business segments, the Corporate and Investment Bank (‘CIB’) and Consumer, Cards and Payments (‘CC&P’).

The CIB is comprised of the Corporate Banking, Investment Banking and Markets businesses, providing products and services to money

managers, financial institutions, governments, supranational organisations and corporate clients to manage their funding, financing,

strategic and risk management needs.

CC&P is comprised of Barclays Consumer Bank Europe (‘CBE’) and the Private Bank. Barclays Consumer Bank Europe provides credit cards,

online loans, instalment purchase financing, electronic point-of-sale financing and deposits. The Private Bank offers investment, banking

and credit capabilities to meet the needs of our clients across the EEA.

The Bank’s Italian mortgage portfolio (which is being run off) is held within the Bank’s Head Office.

MARKET AND OPERATING ENVIRONMENT

The initial recovery following the COVID-19 pandemic was abated by the difficult economic conditions experienced in 2022, driven largely

by the Russian invasion of Ukraine, soaring energy prices and supply chain difficulties from rapidly increasing demand as lockdowns ended.

Global inflationary pressures, and the monetary policy action in the form of interest rate increases by central banks across the globe, had a

profound effect on the macroeconomic environment in Europe.

In our CIB segment, market volatility, inflation and geopolitical uncertainty created headwinds for deal-making across all products.

However, market volatility provided the conditions for a strong year for our Global Markets franchise, particularly the Rates and Fixed

Income Financing businesses, whilst our Corporate Banking franchise has benefited from increasing interest rates and payment flows.

We continued to assist our clients, ranging from supranational and sovereign to corporate, to access the capital markets for liquidity,

capital and investment purposes. Our Investment Banking business continued to capitalise on the opportunities presented by the transition

to a low-carbon economy. This included offerings that were linked to our environmental, social and governance(‘ESG’) targets. Our

Corporate Banking business supported our clients with multiple bespoke solutions and an expanded ESG product offering.

Within CC&P, CBE operates a leading German credit card and personal lending franchise and an innovative partnership providing point-of-

sale finance for a global e-commerce business. Recovery in consumer activity and spending during 2022 was tempered by the rise in

inflation and interest rates, driving changes in consumer behaviour and demand for credit in the latter part of 2022. As a result of the

macroeconomic conditions, solid underlying performance was impacted by impairment provisioning. Alongside strong growth in its

domestic market in Ireland, the Private Bank continued to execute its expansion plans in France, Italy and Spain. Market uncertainty has

moderated Private Bank clients' appetite to invest in regular equity-related strategies, whilst higher market volatility is supporting strong

investment in transactional activity.

Consistent with Barclays’ strategic priority to capture opportunities as we transition to a low-carbon economy, we continued to innovate

our product offering and support our clients’ issuance of green and other sustainability-linked securities.

Our ability to adapt to alternative working arrangements and still deliver for our customers and clients is evidence of the resilience and

dedication of our colleagues. As we begin 2023, we will work hard to protect and strengthen our culture, find ways to attract and progress

talent that suitably reflects the diversity of our communities, and build a supportive working environment within the Bank which can enable

us to operate for the benefit of all our stakeholders.

Strategic report

Performance review

GROWING WITH SOCIETY

The following sub-sections include a summary of the BBI’s specific items from the Barclays PLC 2022 Annual Report. For full details, refer

to the ‘Society’ section of the Barclays PLC 2022 Annual Report.

Our success is judged not only by commercial performance, but also by our contribution to society and in the way we 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.

We believe that we can, and should, make a positive difference for society – globally and locally. We do that through the choices we make

about how we run our business in light of all relevant risks and other factors, and through the commitments we make to support our

clients and communities and to champion sustainability for the long term. We recognise that we are at our best when our clients,

customers, communities and colleagues all progress.

Our focus on society falls broadly into three categories: Climate, Communities and Suppliers.

Climate

Addressing climate change is an urgent and complex challenge, but also an opportunity. It requires a fundamental transformation of the

global economy. The financial sector has an important role to play in supporting the transition to a low-carbon economy and at Barclays,

we are determined to play our part consistent with our Purpose and relevant business and risk considerations.

In 2020, the Barclays Group announced an ambition to be a net zero bank by 2050, across all of its direct and indirect emissions, and

committed to align all of its financing activities with the goals and timelines of the Paris Agreement. The Barclays Group made it clear at the

time that it would approach the climate challenge thoughtfully and transparently, engaging with shareholders and other stakeholders and

reporting our progress.

In doing so, the Barclays Group also recognises the importance of supporting a just transition considering the social risks and opportunities

of the transition and seeking to ensure effective dialogue with affected stakeholders.

The Bank applies the policies of the Barclays Group in response to climate change.

For more details on the Bank’s response to climate change and the environment, please see climate and sustainability section on pages 21

to 30.

Communities

In the communities in which it operates, the Barclays Group is supporting people to develop the skills and confidence they need to succeed

now and in the future. It collaborates with experienced partners, employability experts and businesses to develop meaningful and

innovative programmes that aim to deliver a significant positive impact over the long-term.

We remain committed to our purpose of deploying finance responsibly to support people and businesses, acting with empathy and

integrity, championing innovation and sustainability, for the common good and the long term. After a thorough evaluation, in 2022, we

launched a joint work programme with INCO across five countries (France, Germany, Ireland, Italy and Spain) to deliver programmes that

seek to provide equitable access to the knowledge, skills and habits necessary to secure employment in digital industries. INCO provides

free technology skills training for people facing barriers to employment, including: young people not in education, employment or training;

women who are underrepresented in science, technology, engineering and mathematics jobs; people experiencing intergenerational

poverty; and migrants, refugees and asylum seekers and people with disabilities. The programmes aim to secure IT jobs for at least 80% of

its graduates within six months of completing the programme.

More information on how the Barclays Group is supporting communities can be found in the Barclays PLC 2022 Annual Report.

Suppliers

As a global institution, the Barclays Group has responsibility for a large supply chain. The Barclays Group engages directly with suppliers

seeking to promote diversity, equity and inclusion and are committed to identifying and addressing modern slavery risks across our

operations, supply chain, and customer and client relationships.

Strategic report

Performance review

The Bank 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

Within the Bank, risks are identified and overseen in accordance with the Enterprise Risk Management Framework (‘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 the Bank identifies and manages its risks. The ERMF is approved by the Barclays PLC Board on the

recommendation of the Barclays Group Chief Risk Officer; it is then adopted by the Bank with modifications where needed. Given the increasing

risks associated with climate change, and to support the Group’s ambition to be a net zero bank by 2050, Climate risk became a Principal Risk

at the start of 2022.

The management of risk is embedded into each level of the business, with all colleagues being responsible for identifying and controlling risk.

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 Bank may choose to adopt a lower risk appetite than allocated to it by the Barclays Group.

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, 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 BBI Board and the BBI 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 Bank and is not formally part of any of the three lines of defence. The Legal function is

responsible for the identification of all legal and regulatory risks. 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 conduct risks, as well as with respect to the legal and regulatory risks to which the

Bank is exposed.

For further detailed analysis of our approach to risk management and risk performance see the full Risk review on pages 32 to 111.

Strategic Report

Managing risk


The Enterprise Risk Management Framework defines nine Principal Risks
	Principal Risks	Risks are classified into Principal Risks, as below	How risks are managed
	Climate Risk	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 arising as a result of second order impacts on portfolios of these two drivers.	The Barclays Group and the Bank assess and manage climate risk across businesses and functions in line with the Barclays Group’s net zero ambition by monitoring exposure to elevated risk sectors, conducting scenario analysis and risk assessments for key portfolios. Climate Risk became a Principal Risk in 2022. Climate risk controls are embedded across the Financial and Operational Principal Risk types through the Barclays Group's Frameworks, Policies and Standards (which apply to the Bank).
Principal Risk	Credit Risk	The risk of loss to the Bank from the failure of clients, customers or counterparties (including sovereigns), to fully honour their obligations to the Bank, 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.
	Market Risk	The risk of loss arising from potential adverse changes in the value of the Bank’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.	A range of complementary approaches to identify and evaluate market risk are used to capture exposure to market risk. These are measured, limited and monitored by market risk specialists.
	Treasury and Capital Risk	Liquidity Risk: The risk that the Bank 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 Planning, Liquidity, Asset and Liability Management and Market Risk. A range of approaches are used appropriate to the risk, such as limits, plan monitoring and stress testing based on real time/timely information from our operations.
		Capital Risk: The risk that the Bank 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 Bank’s defined benefit pension plans.
		Interest Rate Risk in the banking book: The risk that the Bank is exposed to capital or income volatility because of a mismatch between the interest rate exposures of its (non-traded) assets and liabilities.
	Operational Risk	The risk of loss to the Bank 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.	The Bank assesses and manages its operational risk and control environment across its businesses and functions with a view to maintaining an acceptable level of residual risk.
	Model Risk	The potential for adverse consequences from decisions based on incorrect or misused model outputs and reports.	Models are evaluated for approval prior to implementation, and on an ongoing basis.
	Conduct Risk	The risk of poor outcomes for, or harm to, customers, clients and markets, arising from the delivery of the Bank's products and services.	The Conduct Risk Management Framework (‘CRMF’) sets out the control objectives and minimum control requirements which must be implemented to manage Conduct Risk. A selection of tools is mandated in the CRMF and Barclays Control Framework to support with the assessment of Conduct Risks, whilst the governance of Conduct Risk is fulfilled through management committees and forums with clear escalation and reporting lines to Board-level committees.
	Reputation Risk	The risk that an action, transaction, investment, event, decision, or business relationship will reduce trust in the Bank’s integrity and/or competence.	Reputation risk is managed by embedding our purpose and values, and maintaining a controlled culture within the Bank, 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 BBI Board.
	Legal Risk	The risk of loss or imposition of penalties, damages or fines from the failure of the Bank to meet its legal obligations, including regulatory or contractual requirements.	Legal risk is managed by the identification of legal risks by the Legal Function, the engagement of the Legal Function in situations that have the potential for legal risk, and the escalation of legal risk as necessary.

Note

The ERMF defines nine Principal Risks. For further information on how these Principal Risks apply specifically to the Bank, please see pages 46 to 56.

Strategic Report

Managing risk

Key performance highlights


	2022	2021
Income statement:	€m	€m
Total income	1,430	1,196
Operating expenses	(1,106)	(968)
Profit before impairment	324	228
Credit impairment (charges)/releases	(167)	97
Profit before tax	157	325
Tax charge	(57)	(90)
Profit after tax	100	235
Attributable to other equity instrument holders	(48)	(40)
Profit attributable to ordinary shareholders	52	195

Cost: income ratioa	77%	81%
No. of employees at 31 December (full time equivalent)	1,776	1,708

Balance Sheet information:	€bn	€bn
Assets
Cash and balances at central banks	30.5	24.1
Cash collateral and settlement balances	18.5	17.7
Loans and advances to customers	13.9	13.1
Trading portfolio assets	7.7	8.2
Financial assets at fair value through the income statement	17.2	15.4
Derivative financial instruments	40.4	33.9
Total assets	132.5	117.1

Liabilities
Deposits from customers	25.8	21.4
Cash collateral and settlement balances	24.7	17.1
Trading portfolio liabilities	12.9	10.3
Subordinated liabilities	4.7	3.2
Financial liabilities designated at fair value	14.9	13.8
Derivative financial instrument	32.5	33.5

Total equity	6.5	5.9

Credit quality:
% of loans and advances to customers impairedb (%)	4.2%	4.6%
Expected Credit Loss (‘ECL’) coverage on loans and advances to customersc (%)	3.7%	3.3%
ECL coverage on impaired loans and advances to customersd (%)	43%	40%

Capital and liquiditye:
Risk weighted assetsf (€bn)	35.2	32.1
Common equity tier 1 (‘CET1’) (transitional)g,h (€bn)	5.9	5.2
CET1 (transitional)h, i (%)	16.7%	16.1%
Total regulatory capital (transitional)h,i (%)	22.4%	21.4%
Liquidity poolj (€bn)	30.7	25.4
Liquidity coverage ratio (‘LCR’)k (%)	194%	171%
Net stable funding ratio (‘NSFR’) (%)	149%	148%
Loan to Deposit ratiol	54%	61%

Notes:

aOperating expenses (excluding impairment) divided by total income (see page 129).

bStage 3 gross loans and advances to customers divided by total gross loans and advances to customers (see page 63).

cTotal ECL on loans and advances to customers divided by total gross loans and advances to customers (see page 63).

dStage 3 ECL on loans and advances to customers divided by stage 3 gross loans and advances to customers (see page 63).

eCapital and liquidity requirements are part of the regulatory framework governing how banks and depository institutions are supervised.

fRisk weighted assets (‘RWAs’) are measured in accordance with the provisions of the Capital Requirements Regulation (‘CRR’) and the Capital

Requirements Directive IV (‘CRD IV’) as amended by the Capital Requirements Regulation II (‘CRR II’) and the Capital Requirements Directive V (‘CRD V’).

gCET1 is a measure of capital that is predominantly common equity as defined by the CRR, as amended by CRR II.

hThe Bank is now reporting its CET1 and associated ratios inclusive of certain reserves, which amount to €189.5m, as eligible core equity under CRR II. The

31 December 2021 CET1, CET1 ratio and total capital ratio above have been restated accordingly. Excluding these reserves, the 31 December 2021 CET1,

CET1 ratio and total regulatory capital ratio were €5.0bn, 15.5% and 20.8% respectively.

iCapital ratios express a bank’s capital as a percentage of its RWAs (see page 105).

jThe Bank’s liquidity pool represents its stock of high quality liquid assets (‘HQLA’s), which are high or extremely high liquidity and credit quality assets as

defined by Commission Delegated Regulation (EU) 2015/61, commonly referred to as the ‘Delegated Act’.

kThe liquidity coverage ratio expresses a bank’s HQLA’s as a percentage of its stressed net outflows over a 30 day period as defined by the Delegated Act.

lLoans and advances to customers, net of ECL, divided by deposits from customers (see page 131).

Strategic Report

Performance measures

Income statement commentary

The Bank earned a profit before impairment in the year ended 31 December 2022 of €324m (2021: profit before impairment €228m), an

improvement of €96m, due to an increase in total income of €234m, partially offset by an increase in costs of €138m.

The Bank earned a profit before tax in the year ended 31 December 2022 of €157m (2021: profit before tax of €325m). This represented a

decrease of €168m, reflecting an increase in impairment charges of €264m offset by an increase in profit before impairment of €96m. The

CIB segment had a profit before tax of €270m, an increase of €16m on 2021. CC&P incurred a loss before tax of €(8)m, a decrease of

€135m from its profit before tax of €127m in 2021, driven by €134m of impairment charges, compared to a release of €24m in 2021. The

loss in Head Office was €(105)m, an increase of €49m from the loss before tax of €(56)m in 2021. This loss in Head Office is primarily

driven by Treasury activities and Italian mortgage portfolio.

Total income increased by €234m to €1,430m (2021: €1,196m), largely reflecting:

–an increase in CIB income to €1,117m; an increase of €254m or 29% (2021: €863m), primarily due to increased trading income

in our Markets business as a result of increased client activity and significant market volatility, together with an increase in fee

income from our parent BB PLC, whilst in our Corporate business, income growth was driven by increased client activity from the

roll out of enhanced transaction banking capabilities and the rising interest rate environment.

–an increase in CC&P income to €368m, €29m or 9% higher (2021: €339m), primarily reflecting ongoing recovery from the

COVID-19 pandemic for our Consumer Bank Europe business.

Partly offset by:

–losses in Head Office of €(55)m, an increase of €49m (2021: €6m loss). This increase is primarily driven by Treasury activities,

which included the result of the re-estimation in 2021 and 2022 of cash flows on drawings under the ECB’s Targeted Longer

Term Refinancing Operations (‘TLTRO III’) as a result of changes in the terms of TLTRO III announced by ECB.

During the year, the Bank reviewed some of the transfer pricing arrangements it has in place with other Barclays Group companies. This

review resulted in an amendment in arrangements between the Bank and its Parent, to reflect the benefits derived by the Parent from

managing market risk in respect of Markets-based transactions between the Bank and EEA domiciled customers. The impact of this revised

arrangement was to recognise an additional €43m income within Fee Income and Commission for the year (representing 4% of total Fee

Income).

Operating expenses increased by €138m to €1,106m (2021: €968m), primarily due to investment spend on the growth initiatives underway

in CIB and higher bank levies, including the Single Resolution Fund levy.

Credit impairment charges (net) increased by €(264)m to a charge of €(167)m (2021: net release of €97m), driven by a net increase in

modelled impairment in response to the macroeconomic deterioration, partially offset by the release of COVID-19 uncertainty adjustments.

The Bank’s profit after tax for the year ended 31 December 2022 was €100m (2021: €235m). The Bank incurred a tax charge of €(57)m

(2021: €(90)m). The effective tax rate of 36.3% is higher than the corporation tax rate in Ireland of 12.5%, primarily due to the profits

earned outside of Ireland being taxed at local statutory tax rates that are higher than the Irish tax rate and prior year adjustments.

Balance sheet commentary

As at 31 December 2022, total assets were €132.5bn, an increase of €15.4bn compared to 31 December 2021 (€117.1bn), primarily driven

by increases in derivative financial assets and cash at central banks.

Derivative financial assets increased by €6.6bn to €40.4bn, primarily driven by the impact of the increase in major interest rates on

derivative values, market volatility and increased activity during the period, partially offset by an amendment to the Clearing Terms of

Business (‘CToBs’) between the Bank and BB PLC which results in the mark to market of cleared derivatives being settled daily by cash

payments rather than being collateralised.

The increase in central bank placings by €6.4bn to €30.5bn was primarily driven by an increase in customer deposits and capital issuances.

Customer deposits increased by €4.4bn or 20% in 2022 to €25.8bn primarily due to an increase in short-term deposits. Customer loans and

advances increased by €0.9bn or 7% to €13.9bn. As a result, the loan to deposit ratio reduced from 61% as at 31 December 2021 to 54%

as at 31 December 2022. The increase in loan balances is primarily due to increased lending within CIB and CC&P, which was partially

offset by repayments in the Bank’s Italian mortgage portfolio which is being run off. The loan to deposit ratio of 54% reflects a position

where the Bank continues to be able to fund customer loans from customer deposits.

ECL provisions increased by €110m from €477m to €587m, of which €46m is ECL on loan commitments and financial guarantees, with the

impairment charge for the year being primarily driven by macroeconomic deterioration. Our coverage ratio on loans and advances to

customers increased from 3.3% to 3.7%. ECL provisions include post model adjustments of €38m (2021: €101m), with the decrease in

post model adjustment primarily driven by the release of COVID-19 uncertainty adjustments and macroeconomic deterioration captured

within the model output.

Other Metrics and Capital

The Bank forecasts its liquidity position on a daily basis as the balance sheet asset and liability maturity profile changes. The Bank has

sufficient buffers over the required minimum levels of daily liquidity necessary to meet its regulatory liquidity requirements and its own risk

appetite. In addition, the Bank has a contingency funding plan in place.

The Bank held a liquidity pool of €30.7bn as at 31 December 2022 (2021: €25.4bn). This comprised balances with central banks of

€29.9bna (2021: €23.4bna) and reverse repurchase agreements entered into for liquidity purposes of €0.8bn (2021: €2.0bn), both of which

met the requirements for classification as High Quality Liquidity Assets (‘HQLA’).

The LCR increased from 171% to 194% primarily due to increased corporate and money market deposits, structured funding issuances

and incremental Tier 3 and equity issuances.

Strategic Report

Performance measures

The Bank’s Net Stable Funding Ratio (‘NSFR’) at 31 December 2022 was 149% (2021: 148%), which is above the regulatory minimum

requirement of 100% under CRR II for the Bank.

The Bank’s CET1 ratio (transitional basis) was 16.7% as at 31 December 2022 (2021: 16.1%). The movement in the year was due primarily

to issuances of CET1, partially offset by increased RWAs in the year. The Bank’s total regulatory capital ratio (transitional basis) was 22.4%

as at 31 December 2022 (2021: 21.4%). The Bank’s capital continues to be managed on an ongoing basis to ensure there are sufficient

capital resources.

Note

a. Residual central bank balances related to minimum reserves.

POST BALANCE SHEET EVENTS

There have been no significant events affecting the Bank since year end.

FUTURE DEVELOPMENTS

The Bank is reviewing its business model in line with the ECB's ongoing cross industry desk mapping review exercise. In addition, the Bank

continues to review opportunities to optimise its business portfolio and operational approach, which could lead to further changes in 2023.

NON-FINANCIAL INFORMATION

Information required in accordance with the European Union (Disclosure of Non-Financial and Diversity Information by certain large

undertakings and groups) Regulations 2017 can be found in the Non-financial information statement on pages 16 to 18.

OTHER INFORMATION

Information on research and development, existence of branches of the Bank and financial risk management objectives and policies can be

found in the Directors’ Report on page 9.

Strategic Report

Performance measures

The Directors present their report together with the financial statements for the financial year ended 31 December 2022.

The Bank has chosen, as noted in this Directors’ Report, to include certain matters in its Strategic Report that would otherwise be disclosed

in this Directors’ Report.

Other information that is relevant to the Directors’ Report, and which is incorporated by reference into this report, can be located at:


	Pages
Performance measures	6
Non-financial information statement	16
Risk management	32
Principal risks	32
Financial instruments	151

REVIEW OF THE BUSINESS AND LIKELY FUTURE DEVELOPMENTS

A detailed review of the Bank’s business activities is provided on page 2, and the performance for the year and an indication of likely future

developments are detailed on page 8, in each case within the Strategic Report.

PROFITS AND DIVIDENDS

The Bank's profit after tax for the financial year ended 31 December 2022 was €100m (2021: €235m). No dividends were paid on the

Bank’s ordinary shares in 2022 (2021: €nil) and the Directors do not propose to make a dividend payment on the Bank’s ordinary shares for

the financial year ended 31 December 2022 (2021: €nil).

SHARE CAPITAL

At 31 December 2022, the Bank had 898,669,034 ordinary shares of €1.00 each in issue (2021: 898,668,934). Further details on the Bank’s

capital is set out in Note 28 to the financial statements.

PRINCIPAL RISKS AND UNCERTAINTIES

The Bank is exposed to internal and external risks as part of its ongoing activities. These risks include (among other things) credit risk,

market risk, liquidity risk, climate risk, operational risk and conduct risk. For a description of the Bank’s ERMF, the risks faced by the Bank

and the management of those risks, please see the Risk review on pages 32 to 111.

The Bank continues to monitor the impact on its risk profile of the macroeconomic headwinds of sustained inflationary pressure, including

on energy prices and the cost of living, higher interest rates, the Russian invasion of Ukraine and increased market volatility.

FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

Information regarding the Bank’s financial risk management objectives and policies in relation to the use of financial instruments is set out

in the Risk review on pages 32 to 111.

POLITICAL DONATIONS

The Directors have satisfied themselves that there were no political donations that require disclosure under the Electoral Acts, 1997 (as

amended).

ENVIRONMENT

Information regarding the Bank’s approach to environmental matters can be found on pages 21 to 30.

RESEARCH AND DEVELOPMENT

In the ordinary course of business, the Bank develops new products and services in each of its business segments.

BRANCHES OUTSIDE THE STATE

At 31 December 2022, in addition to its Irish Head Office, the Bank had branches in Belgium, France, Germany, Italy, Luxembourg, the

Netherlands, Portugal, Spain and Sweden.

Directors’ Report

GOING CONCERN

In preparing the Bank’s financial statements, the Directors are required to:

•assess the Bank’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and

•use the going concern basis of accounting, unless they either intend to liquidate the Bank or to cease operations, or have no realistic

alternative but to do so.

This involves an assessment of the future performance of the business, to provide assurance that the Bank has the resources in place that

are required to meet its ongoing regulatory requirements. The assessment is based upon business plans which contain future forecasts of

profitability taken from management’s three year medium term plan as well as projections of future regulatory capital requirements and

business funding needs. This also includes details of the impact of internally generated stress testing scenarios on the liquidity and capital

requirement forecasts. The stress tests used were based upon management’s assessment of reasonably possible economic scenarios that

the Bank could experience.

This assessment showed that the Bank had sufficient capital in place to support its future business requirements and remained above its

regulatory minimum requirements in the stress test scenarios. It also showed that the Bank has an expectation that it can continue to meet

its funding requirements during the scenarios. The Directors concluded that there was a reasonable expectation that the Bank has

adequate resources to continue as a going concern for the foreseeable future.

The Bank’s business activities, financial position, capital, factors likely to affect its future development and performance, and its objectives

and policies in managing the financial risks to which it is exposed are discussed in the Strategic Report and Risk Management sections of

this report.

The Directors have evaluated these risks in the preparation of the consolidated and company financial statements and consider it

appropriate to prepare the financial statements on a going concern basis.

ACCOUNTING RECORDS

The measures taken by the Directors to secure compliance with the Bank’s obligation to keep adequate accounting records are the

appointment of professionally qualified accounting personnel with appropriate expertise, ensuring the provision of adequate resources to

the Bank’s Finance function and the use of appropriate systems. The Bank’s accounting records are kept at its registered office at 1

Molesworth Street, Dublin 2, Ireland.

STATUTORY AUDITORS

KPMG, Chartered Accountants, were first appointed Statutory Auditor on 24 April 2017 and, pursuant to section 383(2) of the Companies

Act 2014, as amended (‘Companies Act 2014’), will continue in office.

DISCLOSURE OF RELEVANT INFORMATION TO AUDITORS

The Directors in office at the date of this report have confirmed that, as far as they are aware:

•there is no relevant audit information of which the Bank’s auditor is unaware; and

•they have taken all the steps that ought to be taken as Directors in order to make themselves aware of any relevant audit information

and to establish that the Bank’s auditor is aware of that information.

CORPORATE GOVERNANCE

The Bank is subject to the CBI’s Corporate Governance Requirements for Credit Institutions 2015 (the ‘Requirements’), including the

additional obligations set out in the Requirements as the Bank is designated as High Impact by the CBI. A statement of compliance with the

Requirements is prepared and signed annually by the Board and is submitted to the CBI alongside the Annual Report.

The Board aspires to have high standards of corporate governance and has adopted corporate governance arrangements which it believes

are appropriate to apply and are designed to ensure effective decision-making to promote the Bank’s success for the long term.

The Board’s primary aim is that its governance arrangements:

•are effective in providing advice and support to management;

•provide checks and balances and encourage constructive challenge;

•drive informed, collaborative and accountable decision-making; and

•create long-term sustainable value for the Bank’s shareholder, the ultimate shareholders of B PLC and our wider stakeholders.

A Group-wide governance framework is set by Barclays and has been designed to facilitate the effective management of the Barclays

Group. This includes the setting of the Barclays Group policies and approach in relation to matters such as Barclays’ Purpose, Values and

Mindset, Barclays’ Remuneration Policy and Barclays’ Charter of Expectations. Where appropriate, this governance makes reference to

those Barclays Group policies which are relevant to the way in which the Bank is governed.

Directors’ Report

A description of the main features of the Bank’s internal control and risk management systems in relation to its financial reporting process

is set out in the section titled ‘Controls over Financial Reporting’ on page 13.

The Bank is not subject to the European Communities (Takeover Bids (Directive 2004/25/EC)) Regulations 2006.

DIRECTORS

The names of persons who were Directors at any time during the financial year ended 31 December 2022, or who have been appointed

since that date, are set out below.


Directors	Appointed/Resigned	Nationality	Position
Tim Breedon CBE (1),(4)		British	Board Chair and Chair of Board Nominations Committee
Etienne Boris (1), (2), (3), (4)		French	Board Audit Committee Chair
Thomas Huertas (1), (2), (3), (4), (5)		American	Board Risk Committee Chair
Eoin O’Driscoll (1), (2), (3), (4), (5)		Irish	Board Remuneration Committee Chair
Jennifer Allerton (1), (2), (3), (4), (5)		British
Francesco Ceccato (6)		Italian	Chief Executive Officer
Jasper Hanebuth (6)		German	Chief Financial Officer
Joanna Nader (1), (3), (4)	Appointed 22 August 2022	British/ Canadian

(1):Independent non-executive Director

(2):Member of the Board Audit Committee

(3):Member of the Board Risk Committee

(4):Member of the Board Nominations Committee

(5):Member of the Board Remuneration Committee

(6):Executive Director

COMPANY SECRETARY

Francesca Carbonaro

COMPANY NUMBER

396330

DIRECTORS' AND COMPANY SECRETARY'S INTERESTS

During the year ended 31 December 2022, certain of the Directors and the Company Secretary had interests in the ordinary shares of the

Bank’s ultimate parent company, B PLC. At no point during the year ended 31 December 2022 did this interest exceed 1% of B PLC’s

ordinary share capital.

Save as provided above, none of the Directors or Company Secretary had any interests in ordinary shares, debentures or other debt

securities of any member of the Barclays Group during the year ended 31 December 2022.

THE BOARD

Executive and Non-Executive Directors share the same duties and are subject to the same constraints. However, a clear division of

responsibilities has been established. The Chair is responsible for leading the Board and its overall effectiveness, demonstrating objective

judgement and promoting a culture of openness and constructive debate between all Directors. The Chair facilitates the effective

contribution of the Board and ensures Directors receive accurate, clear and timely information. It is the Board’s responsibility to ensure that

management delivers on short-term objectives, whilst promoting the long-term success of the Bank in the context of the Barclay’s Group.

The Board is also responsible for ensuring that management maintains an effective system of internal control which should provide

assurance of effective and efficient operations, internal financial controls and compliance with law and regulation.

The Bank’s Schedule of Matters Reserved to the Board specifies those decisions to be taken by the Board, including but not limited to

material decisions relating to strategy, risk appetite, medium term plans, capital and liquidity plans, risk management and controls

frameworks, reputation risk, approval of financial statements, and approval of share allotments and dividends. The Board has delegated the

responsibility for making and implementing operational decisions and running the Bank’s business on a day-to-day basis to the Chief

Executive Officer (‘CEO’) and his senior management team.

The current Board comprises of a Chair, two Executive Directors, and five independent Non-Executive Directors. The majority of the Board

are independent Non-Executive Directors bringing significant expertise (including external perspectives) and independent challenge.

Directors’ Report

BOARD COMMITTEES

The Board has established four board sub-committees, which are the Audit Committee, Risk Committee, Nominations Committee and

Remuneration Committee. Each Board Committee has delegated authority from the Board in respect of the functions and powers, which

are set out in each Committee’s Terms of Reference.

The Chair of each Board Committee provides a report on the proceedings of each Committee meeting at the next scheduled Board

meeting, including any matters being recommended for approval.

Audit Committee

The Bank’s Board Audit Committee (‘BAC’) is comprised solely of independent Non-Executive Directors, is a Committee of the Board and

assists the Board in monitoring:

•the integrity of the Bank’s accounting policies and contents of its financial statements and the disclosure controls and procedures;

•the effectiveness of the Bank’s internal controls;

•the effectiveness of the internal and external audit functions and processes;

•the performance and independence of the external auditors; and

•the effectiveness of the Bank’s whistleblowing procedures.

Risk Committee

The Bank’s Board Risk Committee (‘BRC’) is comprised solely of independent Non-Executive Directors, is a Committee of the Board and

assists the Board in:

•reviewing the risk profile of the Bank;

•considering the risk appetite and risk tolerance for financial and non-financial risks bearing in mind the current financial situation of the

Bank and the present and future strategy;

•reviewing the management of the Principal Risks in the ERMF to ensure that they are in line with the Bank’s business strategy,

objectives, corporate culture and values;

•overseeing the implementation of strategies for capital and liquidity management, as well as for all relevant risks, such as market, credit

and operational risks (including legal, human resources and IT risks), in order to assess their adequacy against the approved risk

appetite and strategy; and

•assessing the risks associated with the Bank’s offered financial products and services, taking into account the alignment between the

prices assigned to and the profits gained from those products and services.

Nominations Committee

The Bank’s Board Nominations Committee is comprised solely of independent Non-Executive Directors, is a Committee of the Board and

assists the Board in fulfilling its responsibilities relating to:

•identifying individuals who are best able to discharge the duties and responsibilities of Directors and Key Function Holders (individuals

holding CBI Pre-Approval Controlled Function roles) for the Bank in line with legal and regulatory requirements;

•the composition, appointments, succession and evaluating the effectiveness of the Board, ensuring that both appointments and

succession policies are based on suitability, merit and objective criteria including promoting diversity of gender, age and social and

ethnic background, cognitive and personal strengths; and

•the adoption of appropriate internal policies on the assessment of the suitability of Directors, members of the Bank’s Executive

Committee and other key personnel subject to regulatory approval.

Remuneration Committee

The Bank’s Board Remuneration Committee is comprised solely of independent Non-Executive Directors, is a Committee of the Board and

assists the Board in fulfilling its responsibilities relating to:

•the over-arching principles and parameters of the remuneration policy for the Bank;

•the incentive pool for the Bank and the remuneration of key BBI executives and other specified individuals as determined by the

Committee; and

•oversight of remuneration issues.

ACCOUNTABILITY

The Board has put processes in place to support the presentation to stakeholders of fair, balanced and understandable information.

The Board is responsible for setting the Bank’s risk appetite within the overall parameters set by BB PLC, that is the level of risk it is prepared

to take in the context of achieving the Bank’s and the Barclays Group’s strategic objectives. The ERMF is designed to identify and set

minimum requirements in respect of the main risks to achieving the Bank’s strategic objectives and to provide reasonable assurance that

internal controls are effective.

The Board, assisted by the BRC, conducts robust assessments of the principal risks facing the Bank, including those that would threaten its

business model, future performance, solvency or liquidity.

Directors’ Report

The BAC oversees the effectiveness of the Bank’s internal and external auditors. The Directors also review the effectiveness of the Bank’s

systems of internal control and risk management.

CONTROLS OVER FINANCIAL REPORTING

A framework of disclosure controls and procedures is in place to support the approval of the Bank’s financial statements. Specific

committees and accountable individuals 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.

Relevant accountable individuals report their conclusions to the BAC, which debates the conclusions and provides further challenge. Finally,

the Board scrutinises and approves the results announcement 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 Bank’s financial statements and other significant disclosures before they are made public.

AUDIT, RISK AND INTERNAL CONTROL

The Bank is committed to operating within a strong system of internal control that enables business to be transacted and risk taken

without exposure to unacceptable potential losses or reputational damage.

The Board is 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 provide only reasonable, rather than absolute, assurance against material misstatement or loss.

Processes are in place for identifying, evaluating and managing the principal risks facing the Bank. A key component of the framework is

the ERMF which supports the business in its aim to embed effective risk management and a strong risk management culture. The ERMF is

designed to identify and set minimum requirements, in respect of the main risks, to achieve the Bank’s strategic objectives and to provide

reasonable assurance that internal controls are effective. Further detail on the Principal Risks and management of them can be found in the

Risk review on pages 46 to 56.

The effectiveness of the risk management and internal control systems is reviewed regularly by the BRC and the BAC (as detailed above).

The BRC is responsible for providing oversight and advice to the Board in relation to current and potential future risk exposures, examining

reports covering the principal risks including those that would threaten the Bank’s business model, future performance, solvency or

liquidity, as well as reports on risk measurement methodologies and risk appetite.

As referenced above, the BAC carries out several duties delegated to it by the Board, including oversight of financial reporting processes,

reviewing the effectiveness of internal controls, considering whistleblowing arrangements and oversight of the work of the external and

internal auditors.

Throughout the year ended 31 December 2022 and to the date of this report, the Bank has operated an effective system of internal control

that provides reasonable assurance of financial and operational controls and compliance with laws and regulations.

The Board, assisted by the BAC, is responsible for ensuring the independence and effectiveness of the internal and external audit functions.

For this reason, the BAC members met periodically with the Bank’s Chief Internal Auditor and the Key Audit Partner/Lead Audit

Engagement Partner of the external auditor without management present.

Management is responsible for establishing and maintaining adequate internal controls 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 International Financial Reporting Standards (‘IFRS’) as adopted by the EU. 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 assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance

with IFRS as adopted by the EU and that receipts and expenditures are being made only in accordance with authorisations of

management and the respective Directors; and

•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 controls over financial reporting may

become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There have been no changes in the Bank’s internal control over financial reporting that occurred during the period covered by this report

which have materially affected or are reasonably likely to materially affect the Bank’s internal control over financial reporting.

Directors’ Report

EXECUTIVE COMMITTEE

During 2022, the Executive Committee membership included the Bank’s CEO, Chief Financial Officer (‘CFO’), Chief Operating Officer

(‘COO’), Chief Risk Officer (‘CRO’), and leaders of each business unit, Human Resources, Legal and Compliance. The Executive Committee

meets regularly (albeit virtually for the majority of the year) and is chaired by the CEO. The Executive Committee is also attended by the

Bank’s Chief Internal Auditor to ensure full transparency of all matters discussed at the Committee and to inform the audit plan. In addition

to the day-to-day management of the Bank, the Executive Committee supports the CEO in ensuring that the values, strategy and culture

align, are implemented and are communicated consistently to colleagues – for example, through regular leadership team conferences and

communications that are available to all colleagues.

DIVERSITY, EQUITY AND INCLUSION

The Board recognises the importance of ensuring that there is broad diversity among the Directors inclusive of, but not limited to, gender,

ethnicity, geography and business experience. In addition, the Bank aims to ensure that employees of all backgrounds are treated equally

and have the opportunity to be successful. The Barclays Group’s global diversity, equity and inclusion (‘DEI’) strategy, which is supported

by the Bank, sets objectives, initiatives and plans across six areas of focus: Gender, LGBT+, Disability, Multicultural, Multigenerational and

Socio-economic inclusion, in support of that ambition.

DIRECTORS’ COMPLIANCE STATEMENT

The Directors acknowledge that they are responsible for securing the Bank’s compliance with its relevant obligations under the Companies

Act 2014.

The Directors confirm that:

•a compliance policy statement setting out the Bank’s policies, that in the Directors’ opinion are appropriate to the Bank, regarding

compliance by the Bank with its relevant obligations has been drawn up;

•appropriate arrangements or structures that are designed to secure material compliance with the Bank’s relevant obligations have been

put in place; and

•a review of these arrangements and structures has been conducted during the financial year ended 31 December 2022.

STATEMENT OF DIRECTORS' RESPONSIBILITIES IN RESPECT OF THE ANNUAL REPORT AND FINANCIAL STATEMENTS

The Directors are responsible for preparing the Annual Report and the consolidated and Company financial statements in accordance with,

and subject to, applicable law and regulations.

Irish company law requires the Directors to prepare financial statements for each financial year. Under that law, they have elected to

prepare the Consolidated and Company financial statements in accordance with IFRS as adopted by the EU.

Under Irish company law, the Directors must not approve the financial statements unless they are satisfied that they give a true and fair

view of the Bank’s assets, liabilities and financial position as at the end of the financial year and of the profit or loss of the Bank for that year.

In preparing the financial statements, the Directors are required to:

•select suitable accounting policies and then apply them consistently;

•make judgements and estimates that are reasonable and prudent;

•state whether applicable Accounting Standards have been followed, subject to any material departures disclosed and explained in the

financial statements;

•assess the Bank’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and

•use the going concern basis of accounting unless they either intend to liquidate the Bank or to cease operations, or have no realistic

alternative but to do so.

The Directors are responsible for keeping adequate accounting records which disclose with reasonable accuracy at any time the assets,

liabilities, financial position and profit or loss of the Bank and which enable them to ensure that the financial statements of the Bank comply

with the provisions of the Companies Act 2014. 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, and have general

responsibility for taking all reasonable steps to ensure such records are kept which enable them to ensure that the financial statements of

the Bank comply with the provisions of the Companies Act 2014.

The Directors are responsible for safeguarding the assets of the Bank, and hence for taking reasonable steps for the prevention and

detection of fraud and other irregularities.

The Directors are responsible for preparing a Directors’ Report that complies with the requirements of the Companies Act 2014.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included in respect of the Bank

which is on the Barclays Group website.

Legislation in the Republic of Ireland governing the preparation and dissemination of financial statements may differ from legislation in

other jurisdictions.

Directors’ Report

The current Directors, whose names and functions are set out on page 11, confirm to the best of their knowledge that:

•they have complied with the above requirements in preparing the Consolidated and Company financial statements;

•the Consolidated and Company financial statements, prepared in accordance with IFRS as adopted by the EU, give a true and fair view

of the assets, liabilities, financial position and profit or loss of the Bank;

•the management report contained within the Strategic Report, on pages 2 to 8, includes a fair review of the development and

performance of the business and the position of the Bank, together with a description of the principal risks and uncertainties that the

Bank faces; and

•the Annual Report and the financial statements, taken as a whole, is fair, balanced and understandable and provides the information

necessary for the Bank’s shareholder to assess the Bank’s position and performance, business model and strategy.

On behalf of the Board


Tim Breedon CBE	Francesco Ceccato	Jasper Hanebuth
Chair	Chief Executive Officer	Chief Financial Officer

15 March 2023

Directors’ Report

The Non-Financial Reporting requirements of the European Union (Disclosure of Non-Financial and Diversity information by certain large

undertakings and groups) Regulations 2017 are addressed within this section by means of cross reference. We have used cross referencing

as appropriate to deliver clear, concise and transparent reporting.

The Barclays Group has a range of policies and guidance (available at home.barclays/sustainability/esg-resource-hub/) that support key

outcomes in respect of non-financial performance for all of its stakeholders. Across the Barclays Group, policies and statements of intent

are in place to ensure consistent governance on a range of issues. For the purposes of the Non-Financial Reporting requirements, these

include, but are not limited to:


Environmental statementsa
Statement or policy position	Description	Information to help understand the Bank, and its impact, policies, due diligence and outcomes
Climate Change statement	The Barclays Position on Climate Change sets out our approach, based on a consideration of all risk and market factors, to certain energy sectors with higher carbon-related exposures or emissions from extraction or consumption, or those which may have an impact in certain sensitive environments or on communities, namely thermal coal mining, coal-fired power generation, mountain top coal removal, oil sands, Arctic oil and gas, and hydraulic fracturing (‘fracking’). The statement outlines the Barclays Group’s focus on supporting its 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.	See our ‘Climate and Sustainability’ section from page 21 to 30
Forestry and Agricultural Commodities statement	The Barclays Group recognises that the forestry and agribusiness industries are responsible for producing a range of commodities such as timber, palm oil and soy that are often associated with significant environmental and social impacts, particularly in relation to biodiversity loss, tropical deforestation and climate change. The Barclays Group Forestry and Agricultural Commodities Statement outlines its due diligence approach for clients involved in these activities, ensuring that the Barclays Group supports clients that promote sustainable forestry and agribusiness practices while respecting the rights of workers and local communities.	See the ‘Managing impacts in lending and financing’ section on pages 21 to 22 within ‘Climate and Sustainability’ section
World Heritage Site and Ramsar Wetlands statement	The Barclays Group understands that certain industries can impact areas of high biodiversity value including United Nations Educational, Scientific and Cultural Organisation (‘UNESCO’) World Heritage Sites (‘WHS’) and Ramsar Wetlands (‘RW’). The Barclays Group’s WHS and RW statement outlines the Barclays Group’s client due diligence approach to preserving and safeguarding these sites.	See our ‘Nature and biodiversity’ section on pages 22 to 23 within our ‘Climate and Sustainability’ section
Environmental risk in lending	The Barclays Group is committed to managing the direct and indirect environmental risks associated with commercial lending. Environmental risk is regarded as a credit risk driver, and is considered in the Barclays credit risk assessment process through the Barclays Group Environmental Risk Standard. A dedicated Environmental and Climate Risk team at Barclays Group level is responsible for advising on environmental and climate-related credit risks to Barclays associated with particular transactions and industries. Environmental risks in credit are governed under the Client Assessment and Aggregation Policy and Standard which are embedded within the Wholesale Credit Risk Control Framework, which is part of the Enterprise Risk Management Framework.	See our Climate risk section on page 46
Climate Change, Financial Risk and Operational Risk Policy	The Climate Change Financial Risk and Operational Risk Policy outlines the requirements and policy objectives for assessing and managing the impact on Financial and Operational Risks arising from the physical, transition and connected risks associated with climate change. This incorporates identification, measurement, management and reporting. Financial and Operational Risks / Themes associated with Climate Change are being managed in accordance with the requirements set out in this policy.	See our Climate risk section on page 46

Note

a The Bank applies the policies of Barclays Group in response to climate change and the environment and applicable laws and/or regulations in the EU and UK.

Non-financial information statement


Colleagues
Statement or policy position	Description	Information to help understand the Bank, and its impact, policies, due diligence and outcomes
Board Diversity Policy	The Barclays Group Board Diversity Policy confirms that the Board Nominations Committee will consider candidates on merit against objective criteria and with due regard to the benefits of diversity in identifying suitable candidates for appointment to the Board.	See detail on ‘Our people and culture’ on page 19
Code of Conduct	The Barclays Way is our code of conduct and outlines the Purpose, Values and Mindset which 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	N/A
Measures of Success	The Bank uses a variety of tools to track and measure its strategic delivery, and collects both quantitative and qualitative information to develop the full picture of its performance.	See detail on ‘Our people and culture’ on page 19


Social matters
Statement or policy position	Description	Information to help understand the Bank, and its impact, policies, due diligence and outcomes
Donations	The Barclays Group works in partnership with non-profit organisations, including charities and non-governmental organisations, to develop high-performing programmes and volunteering opportunities that harness the skills and passion of our employees. The Barclays Group has chosen to partner with a small number of organisations, allowing us to have deeper relationships and ultimately enabling us to have the greatest impact on our communities in which we operate. The Barclays Group does not accept unsolicited donation requests.	• home.barclays/ content/dam/homebarclays/ documents/ citizenship/ourreporting-and- policypositions/ Barclaysdonationguidelines.pd f
Tax	The Barclays Group’s Tax Principles are central to the Bank’s approach to tax planning, for ourselves or on behalf of our clients. Since their introduction in 2013, we believe the Barclays Group’s 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 the Barclays Group’s Tax Code of Conduct.	N/A
Sanctions	Sanctions are restrictions on activity with targeted countries, governments, entities, individuals and industries that are imposed by bodies such as the United Nations (‘UN’), the EU, individual countries or groups of countries. The Barclays Group Sanctions Policy is designed to ensure that the Bank and the Barclays Group comply with applicable sanctions laws in every jurisdiction in which they operate.	N/A
Defence sector	The Barclays Group Statement on the Defence Sector outlines the Barclays Group’s appetite for defence-related transactions and relationships. The Barclays Group provides financial services to the defence sector within a specific policy framework. Transactions and relationships are assessed on a case-by-case basis and legal compliance alone does not automatically guarantee our support.	N/A

Non-financial information statement


Human rights
Statement or policy position	Description	Information to help understand the Bank, and its impact, policies, due diligence and outcomes
Human rights	The Barclays Group is committed to operating in accordance with the International Bill of Human Rights and takes account of other internationally accepted human rights standards, including the UN Guiding Principles on Business and Human Rights. We take steps to ensure we are respecting human rights in our operations through our employment policies and practices, in our supply chain through screening and engagement, and through the responsible provision of our products and services.	See the ‘Managing impacts in lending and financing’ section on pages 21 to 22 within the ‘Climate and Sustainability’ section
Modern slavery	The Barclays Group recognises its responsibility to comply with all relevant legislation including the UK Modern Slavery Act 2015. In accordance with the requirements of this Act, the Barclays Group releases an annual Statement on Modern Slavery, which outlines the actions the Barclays Group has taken in seeking to identify and address the risks of modern slavery and human trafficking in our operations, supply chain, and customer and client relationships.	Further details on our Barclays Group Statement on Modern Slavery can be found at: home.barclays/sustainability/ esg-resource-hub/ reporting- and-disclosures/
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 the Barclays Group. 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.	N/A
Data protection	Across the Barclays Group, the privacy and security of personal information is respected and protected. The Barclays Group Privacy website page governs 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.	N/A


Anti-bribery and anti-corruption
Statement or policy position	Description	Information to help understand our Group and its impact, policies, due diligence and outcomes
Bribery and corruption	The Barclays Group recognises that corruption can undermine the rule of law, democratic processes and basic human freedoms, impoverishing states and distorting free trade and competition. The Barclays Group policy statement reflects the statutory requirements applicable to the Barclays Group as derived from the EU-level legislation on combating public and private sector corruption as well as the UN and Organisation for Economic Co-operation and Development conventions on corruption.	N/A
Anti-money laundering and counter-terrorist financing	The Barclays Group’s Financial Crime Policy is designed to ensure that we comply with UK, EU, and other applicable laws and regulations concerning anti-money laundering and counter-terrorist financing, and it takes into account guidance issued by bodies such as the Wolfsberg Group and the European Banking Authority. The Financial Crime Policy is also designed to ensure that all our businesses and legal entities have adequate systems and controls in place to mitigate the risk of the Barclays Group being used to facilitate money laundering and other forms of financial crime.	N/A

Non-financial information statement

The following sub-sections include a summary of the BBI’s specific items from the Barclays PLC Annual Report 2022. For full details, refer

to Our people and culture section of the Barclays PLC Annual Report 2022.

Colleagues

The Bank uses a variety of tools to track and measure its strategic delivery, and collects both quantitative and qualitative information to

develop a full picture of its performance. The measures of success include:


	2022	2021
Females at Managing Director and Director level (%)	26%	25%
Colleague engagement (%)a	76%	73%
“it’s safe to speak up” (%)	78%	74%
“I would recommend Barclays to people I know as a great place to work” (%)a	77%	74%

Note:

aAs part of our efforts to improve our measurement frameworks, we have transitioned to a new three question engagement model after collecting 4 years

of concurrent data and running analysis to affirm the new model’s validity.

Helping Barclays to achieve strategic priorities

Our people and our culture are our greatest assets. We are committed to making Barclays a great place to work, enabling colleagues to

deliver strong results for our customers, clients, communities and each other.

During 2022, we continued to embed the Barclays Mindset, helped colleagues to adapt to hybrid working, supported colleague wellbeing

and made further progress against our diversity, equity and inclusion (‘DEI’) ambitions. Through our colleague listening survey, Your View,

we saw improved scores across all our indices.

In response to increases in living costs experienced by our colleagues we brought forward part of the 2023 pay increase for our most junior

colleagues in Belgium, France, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain, awarding them €1,500 effective from 1

November 2022. In November, we also awarded junior colleagues in Germany a one-off payment of €2,000 as that approach, whilst having

the same effect, was more appropriate under local rules.

Our approach to diversity, equity and inclusion

We launched our refreshed DEI vision and strategy to incorporate 'equity’ into how we talk about, and take action to progress, our DEI

activities, including the launch of Employee Resource Groups.

Our vision is to strengthen our diverse, equitable and inclusive culture, with a view to attracting and retaining the best talent, building high-

performing teams which generate better outcomes for our customers and clients, whilst also meeting the expectations of our regulators,

shareholders and other stakeholders.

We have five strategic priorities: workforce diversity; inclusive and equitable culture; leadership accountability; data transparency and

accountability and optimisation of external relationships. These priorities are underpinned by our guiding principles of accountability,

transparency and engagement. These principles and priorities help us to deliver against our six core agendas - disability, gender, LGBT+,

multicultural, multigenerational and socio-economic.

Board diversity

The Bank recognises and embraces the benefits of having a diverse Board, and sees increasing diversity at Board level as an essential

element in reflecting its European footprint and maintaining a competitive advantage. The Board Diversity Policy sets out the approach to

diversity on the Board of the Bank, and provides that the Nominations Committee will review and assess Board composition on behalf of

the Board and will recommend the appointment of new Directors. In considering the composition, suitability of appointments and

effectiveness of the Board, the Nominations Committee considers differences in the skills, regional and industry experience, social and

ethnic background, nationality, race, gender, age and other distinctions between Directors, such as cognitive and personal strengths. In

terms of gender, the Board’s current target is to ensure that the proportion of women on the Board is 33% by 2024.

Talent now and for the future

Talent Attraction – now and for the future

Across 2022, demand for talent has remained high, alongside a greater focus from candidates seeking flexible working options and on

wellness and wellbeing. In response, we have pursued opportunities to attract and recruit talent as quickly and efficiently as possible, by

developing a specific Entity Employee Value Proposition increasing the number of recruiters to support our businesses and the launch of

the Onboarding app across a number of countries to support a modern digital onboarding experience.

Developing our colleagues

We remain committed to our culture of lifelong learning, through a development proposition that supports colleagues at every stage of

their career.

The Barclays Learning Lab is our learning ecosystem. Consisting of Barclays-designed knowledge and skills modules, as well as modules

from external specialists, it provides our colleagues with the development tools needed to support them in their current and future roles.

Colleagues can access a wide range of workshops, split between colleague and people leader development. This is complemented by our

digital content providers, whose content has been mapped against role-specific learning pathways, making it easy for colleagues to

navigate development resources suitable for their needs. The Learning Lab also offers a selection of self-assessment tools, empowering

colleagues to understand their strengths and development areas. These are supported by business-led solutions that encompass

professional and technical resources encouraging colleagues to drive their own development.

Our people and culture

People leadership at Barclays is about helping others to achieve their potential. To equip our people leaders with the critical skills and

behaviours to inspire, develop and support their teams today and into the future, we have refreshed our Management Unlocked

programme. The programme provides participants with extensive digital content, as well as our Evolution programme, which supports new

people leaders as they transition into leadership roles.

Listening to our colleagues

Listening to colleagues allows us to obtain insights into what we are doing well and areas where we need to focus our attention.

Our bi-annual all-colleague Your View surveys measure colleague considerations across a breadth of topics including colleague

engagement, organisational culture, including the Mindset and Values, wellbeing, inclusion and working practices and tools. The Your View

survey is the primary mechanism for how we track engagement and monitor our culture, with the 2022 survey results indicating good

progress for both engagement and cultural measures. Senior leaders continue to receive and review the results from these surveys to

inform decisions.

We maintain a strong and effective partnership with the Barclays Group European Forum, whom we brief on our strategy and progress to

obtain feedback on how we can improve the colleague experience.

Our policies

Our people policies are designed to 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 also reflect relevant employment law, including the provisions

of the Universal Declaration of Human Rights and the International Labour Organisation (‘ILO’) Declaration on Fundamental Principles and

Rights at Work.

We are committed to paying our people fairly and appropriately relative to their role, skills, experience and performance. This means our

remuneration policies reward performance that is in line with our Purpose, Values and Mindset, as well as our risk expectations. We also

encourage our people to benefit from Barclays’ performance by enrolling in our share ownership plans.

Our people and culture

Barclays’ Climate Strategy

In March 2020, the Barclays Group announced its ambition to be a net zero bank by 2050, becoming one of the first banks to do so. The

Barclays Group has a three-part strategy to turn its net zero ambition into action. All entities in the Barclays Group, including BBI, are

aligned to this three-part strategy.

1.Achieving net zero operations - the Barclays Group is working to reduce its Scope 1, Scope 2 and Scope 3 operationala emissions

consistent with a 1.5°C aligned pathway and counterbalance any residual emissions. The Barclays Group has made progress,

having sourced 100% renewable electricity for its global real estate portfoliob operations, and created a pathway to address its

supply chain emissions.

2.Reducing financed emissions - the Barclays Group 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. The Barclays Group has now set 2030

reduction targets across five of the highest-emitting sectors in the Barclays Group portfolio: Energy, Power, Cement, Steel and

Automotive manufacturing. All of the Barclays Group target-setting includes the integration of 1.5°C aligned scenarios, such as

the International Energy Agency Net Zero 2050 scenario in our financed emission targets, and including the upper end of ranges

for certain sectors.

3.Financing the transition - the Barclays Group is helping to provide the green and sustainable finance required to transform the

economies, customers and clients it serves.

The Barclays Group’s surpassed its 2018 target to deliver £150bn of social and environmental financing by 2025, and is on track

to meet its goal to deliver £100bn of green finance well ahead of 2030. After a strategic review of the Barclays Group’s

capabilities, market demand and growth opportunities, the Barclays Group announced in December 2022 new targets to

facilitate $1trn of Sustainable and Transition Financing between 2023 and the end of 2030, and to increase investment into

global climate tech start-ups to £500m through Barclays’ Sustainable Impact Capital portfolio by the end of 2027.

Notes

a Barclays Group defines Scope 3 operational emissions to include supply chain, waste, business travel and leased assets.

b Global real estate portfolio includes offices, branches, campuses and data centres. See page 81 of the Barclays PLC Annual Report 2022 for full

details.

The Barclays’ Group climate strategy is underpinned by the way it assesses and manages exposure to climate-related risk. Climate risk

became a Principal risk at Barclays Group in 2022.

The Barclays’ Group strategy will continue to evolve and adapt to reflect external factors affecting the shape and timing of the transition to

a low-carbon economy, similar to those impacting clients’ transitions.

Barclays’ Group keeps its policies, targets and progress under review in light of the rapidly changing external environment and the need to

support governments and clients in delivering an orderly energy transition and providing energy security. The trajectory for 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.

In developing its climate strategy, the Barclays Group recognises the importance of supporting a just transition, considering the social risks

and opportunities of the transition and seeking to ensure effective dialogue with affected stakeholders. Barclays Group is working to build

an approach to a transition cognisant of the important dynamic between climate actions and social justice, while being mindful of the

potential interconnectedness with biodiversity.

Many highly carbon-intensive sectors require finance to transition. 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. However, the Barclays Group anticipates that companies which are

unwilling to reduce or eliminate their emissions consistent with internationally accepted pathways may find it increasingly difficult to

access financing, including through Barclays.

More information on Barclays’ Group Climate Strategy can be found in the Barclays PLC 2022 Annual Report.

Managing impacts in lending and financing

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 the 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 ERMF, setting our strategic approach for risk management by

defining standards, objectives and responsibilities for all areas of Barclays Group. The ERMF is complemented by a number of other

frameworks, policies and standards, all of which are aligned to individual Principal Risks.

Climate and sustainability

Our Climate Change Statement sets out our approach in relation to our climate change ambition and to managing the impact of our

climate-related activities, including setting restrictive policies in respect of certain sensitive energy sub-sectors (thermal coal mining, coal-

fired power generation, mountain-top coal removal, oil sands, Arctic oil and gas and hydraulic fracturing (‘fracking’).

Barclays Group has also established positions on Forestry and Agricultural Commodities, World Heritage and Ramsar Wetlands and in the

Defence and Security sector. In addition, we have developed internal standards for each of these which reflects 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 include an enhanced due diligence approach for certain clients operating in energy sub-sectors covered by our Climate

Change Statement (thermal coal mining, coal-fired power generation, mountain-top coal removal, oil sands, Arctic oil and gas projects and

hydraulic fracturing ('fracking') and clients in-scope of our Forestry and Agricultural Commodities, World Heritage and Ramsar Wetlands

and Defence and Security standards where a similar approach is taken.

All in-scope clients in these sub-sectors must be assessed annually via a detailed 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.

Typically, high and certain medium ESI rated clients require further risk assessment prior to execution of transactions with those clients.

Escalation and decision

Where client relationships or transactions are assessed as higher-risk (high or medium ESI risk rating) or outside appetite (in the case of

Defence and Security) following an enhanced due diligence review, they are then considered for escalation to the appropriate BBI business

unit review committee (e.g. Transaction Review Committee) or for BBI clients in scope of our Climate Change standard, the Barclays Group

Climate Transaction Review Committee (‘CTRC’) for consideration and a decision on whether to proceed if transaction related. Business

unit review committees comprise Business management and representatives from the control functions, including Reputation risk, whereas

the CTRC includes representation from the Barclays Group Executive Committee. Should the front office business team, the Sustainability

and ESG team and / or Climate risk team believe the issues are sufficiently material, these clients/ relationships would be escalated to the

Barclays Group Reputation Risk Committee and BBI Conduct and Reputation Committee for more senior consideration and decision.

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.

Environmental credit risks

Environmental risk is regarded as a credit risk driver, and is considered within our credit risk assessment process. The Environmental Risk

team is responsible for advising on the environmental and climate-related credit risks to Barclays Group associated with particular

transactions. Environmental risks in credit are governed under the Client Assessment and Aggregation, Environmental Risk and Nuclear

Industry Risk standards. These standards are part of the overall ERMF.

Training

To support Climate Risk becoming a Principal Risk from January 2022, mandatory training was completed by colleagues in selected teams

across Risk, Compliance, Internal Audit and Markets Post Trade. The training provided an overview of physical and transition risks to enable

colleagues to identify, assess and manage Climate risk. Sustainability and ESG training (with detail on Barclays’ policies and approach to

certain sensitive sub-sectors) was delivered to colleagues in selected teams across the Corporate and Investment Bank, Trade & Working

Capital, Wholesale Onboarding, Finance, Public Policy and Corporate Responsibility, with 96% of those colleagues assigned the training in

Barclays Europe having completed it.

Our approach to nature and biodiversity

Nature and biodiversity is a growing ESG focus for Barclays and the wider industry, given that nature and its ecosystem services

fundamentally underpin economies and societies. Nature and biodiversity are also important to the sector due to their interlinkages with

climate change. During 2022, nature and biodiversity loss continued to be recognised at a global scale. The Convention on Biological

Diversity (‘CBD’) COP15 in December 2022 saw the agreement of the new Global Biodiversity Framework, which will be the framework for

national and international action. For companies and financial institutions, the Taskforce on Nature-related Financial Disclosures (‘TNFD’)

released its third draft iteration of the framework for organisations to assess and disclose on nature-related risk and opportunity.

The Barclays Group and the Bank recognise the important role of the finance sector in stewarding responsible finance towards a nature-

positive future. We continue to work to build an understanding of the ways in which our financing activities impact on nature, as well as

the ways in which Barclays and its clients depend on nature. This includes engaging with industry groups and Barclays’ membership of the

TNFD Forum. We also continue to review the ways in which our financing activities can help to facilitate a nature-positive future.

Climate and sustainability

We recognise interlinkages across environmental and social themes, in particular key crossovers with our approaches to climate change

and human rights. Given these interdependencies it is important for banks to consider nature-related considerations alongside other ESG

factors such as climate change and social considerations.

Case study: Barclays nature-linked financing - Cairn Homes plc Biodiversity Linked SLL

Barclays Corporate Banking Sustainable Product Group provided support to Cairn Homes plc (Cairn) in the selection of meaningful

targets and indicators linked to certain sustainability performance targets.

In July 2022, Cairn completed a refinancing of its €277.5m syndicate facility into a sustainability linked term loan (‘SLL’) and revolving

credit facility (‘RCF’), one of the largest of its type arranged in the Irish homebuilding sector, with AIB, Bank of Ireland and BBI. The term

loan and RCF interest rates are linked to Cairn meeting certain sustainability performance targets on biodiversity, decarbonisation and its

people strategy.

From a biodiversity perspective, the annual targets include a commitment to increase biodiversity net gain (‘BNG’) across Cairn’s new

developments measured as a percentage of overall new homes commenced. BNG delivers measurable improvements for ecology by

protecting, enhancing and creating habitats in association with development and Cairn's approach includes a development-specific

biodiversity programme that replaces or improves the local biodiversity of each new Cairn development or otherwise contributes to the

improvement of Ireland’s biodiversity.

Nature-related risk in financing

The Barclays Group and the Bank include financing restrictions that seek to address nature-related risk within its position statements on

Forestry and Agricultural Commodities, World Heritage Sites and Ramsar Wetlands, and Climate Change. We continue to review and

monitor the ways in which it can strengthen our approach.

We have continued to develop our understanding and ability to evaluate nature-related risk in financing, building on the work started in

2021. This included working with an external expert on a materiality exercise to produce an initial portfolio heatmap to analyse nature-

related risk by sector and exposure across the Barclays Group’s lending portfolio. This involved a qualitative review of sector impacts and

dependencies across a number of key risk drivers representing both physical and transition risks, to determine where in the portfolio were

the likely areas of highest risk. The Barclays Group have been part of a TNFD pilot group led by the United Nations Environment Programme

Finance Initiative (‘UNEP-FI’) to test the draft TNFD Framework. As part of the pilot, we looked specifically at agriculture and food in Europe

and the UK.

We recognise the need for continuous improvement with regards to available data and technologies, in particular noting the complexity

and challenge given the number of nature attributes and their associated metrics. We will therefore continue to support the develop of

methodologies which seek to better evaluate risk impacts and dependencies at a portfolio level. For example, the Barclays Group have

trialled an emerging modelling methodology in order to support participation with the UNEP-FI work, which draws upon a wide range of

available data and also adopts assumptions where there are gaps.

TNFD pilot with UNEP-FI - European Agriculture and Food

In 2022, the TNFD published a draft version of its risk management and disclosure framework for organisations to report and act on

evolving nature-related risks. UNEP-FI is piloting this framework with approximately 40 financial institutions - Barclays is participating in

their pilot group focused on 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 and the UK. This activity was led by the Barclays Group,

but included the Bank’s clients.

This involved assessing our clients’ locations in terms of production and sales and applying a number of biodiversity metrics to each

location to determine where key impacts and risks may arise. A number of different 2030 scenarios were also used to stress the

portfolio and individual counterparties, to see whether material financial impact could arise as a result of nature-related transition and

physical risks. The results are currently being reviewed internally to assess how they could be used alongside existing climate risk

procedures.

For further details, see Barclays’ position statements on the Barclays ESG Resource Hub at: home.barclays/sustainability/esg-resource-

hub/

Climate and sustainability

Overview

In 2020, the EU Taxonomy Regulationa (‘the Regulation’) was published with the objective of establishing a classification system for

environmentally sustainable economic activities that is expected to play an important role in helping the EU scale up sustainable investment

and implement the European Green Dealb.

The EU Taxonomy has six environmental objectives namely:

• 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 and ecosystems.

The Regulation defines what can be considered as an environmentally sustainable economic activity. Article 8 of the Regulation requires

entities subject to the obligation to publish non-financial information pursuant to Article 19a or Article 29a of the Non-Financial Reporting

Directive (‘NFRD’)c , such as the Bank, to disclose to the public how and to what extent their activities are associated with environmentally

sustainable economic activities as defined under the Regulation.

Pursuant to Article 8 of the Regulationd, the Bank will need to disclose Key Performance Indicators (‘KPIs’) on the share of the balance sheet

associated with sustainable activities. For the financial year ended 31 December 2022, the Bank is however only required by the Regulation

to identify economic activities that are “taxonomy eligible” in the context of the environmental objectives of climate change mitigation and

climate change adaptation. Practically, “taxonomy eligible activities” means economic activities within those sectors identified as most

relevant to the climate objectives as set out in specific technical screening criteria. Technical screening criteria for the remaining four

environmental objectives have not been published yet. Eligible activities will qualify for further screening in the future to determine whether

they are taxonomy aligned, and thus considered environmentally sustainable.

From the financial year ending 31 December 2023 onwards, the Bank will be required to report on its “taxonomy aligned activities” using

the Green Asset Ratio (‘GAR’). Taxonomy alignment will show the proportion of taxonomy eligible activities that comply with the

requirements set out in the Regulation i.e. that contribute substantially to one or more of the environmental objectives, that do not

significantly harm any of the environmental objectives, that are carried out in compliance with certain minimum safeguards and that

comply with specified technical screening criteria.

The EU Taxonomy disclosures presented in this section are unaudited and have been prepared on a ‘best efforts’ basis using corporate

disclosures, published financial reports and third party data providers. The EU Taxonomy related disclosures presented in this section have

been made on the basis of the Bank’s understanding of the terms and concepts used under the Regulation and its implementing acts (as

the case may be, as clarified by the European Commission). As the EU Taxonomy requirements and guidance develop and evolve over the

coming years, and as the Bank continues to develop our industry data sourcing and methodologies, we will continue to review our

disclosures in future periods.

The table overleaf sets out the disclosure required to be made by the Bank in relation to the taxonomy eligibility of its economic activities in

the context of the environmental objectives of climate change mitigation and climate change adaptation.

Climate and sustainability

EU Taxonomy


As at 31 December 2022	KPIs	Description
Taxonomy eligible activities as a proportion of total covered assetse	5.3%	Economic activities with undertakings subject to NFRD, households and local governments that have been assessed as eligible in line with the Regulation, as a percentage of total covered assets.
Taxonomy non-eligible activities as a proportion of total covered assets	27.2%	Economic activities with undertakings subject to NFRD, households and local governments that have been assessed as non-eligible in line with the Regulation, as a percentage of total covered assets.
Exposures to undertakings in scope of NFRD as a proportion of total covered assets	32.5%	Covered assets that are exposures to entities subject to NFRD, as a percentage of total covered assets.
Exposures to undertakings out of scope of NFRD as a proportion of total covered assetsf	67.5%	Covered assets that are exposures to entities not subject to NFRD, as a percentage of total covered assets. Exposures that are not in scope of total covered assets are not included in this KPI.
	100%

Derivatives as a proportion of total covered assets	45.1%	Derivative financial instrument assets as a percentage of total covered assets. Derivative financial instrument assets are part of total covered assets, but out of scope for eligibility in line with the Regulation.
Exposures to central banks, central governments and supranationals issuers as a proportion of total covered assets	39.1%	Exposures to central banks, central governments and supranationals issuers, as a percentage of total covered assets. Selected regional and state governments are treated as central governments in line with the European Banking Authority (‘EBA’) listg of regional governments, local authorities and public sector entities that may be treated as central governments.
Trading book as a proportion of total covered assets	8.6%	Trading book exposures as a percentage of total covered assets. Trading book assets comprises debt and equity securities and traded loans reported on the balance sheet as trading portfolio assets, and excludes reverse repurchase agreements at fair value separately reported on the balance sheet.
On demand interbank loans as a proportion of total covered assets	1.5%	Exposures to on-demand interbank loans, as a percentage of total covered assets.
Total covered assetsh	€89,712m	Total covered assets are defined by the EU Taxonomy FAQs as total on-balance sheet assets minus those assets excluded from the calculation of the GAR. Therefore, total assets as defined under IFRS as adopted by the EU, minus trading portfolio assets and exposures to central banks, central governments and supranationals issuers. Total covered assets of €89,712m represents 67.7% of total assets.

Notes

a Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020 on the establishment of a framework to facilitate sustainable

investment.

b https://ec.europa.eu/info/strategy/priorities-2019-2024/european-green-deal_en

c Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements

and related reports of certain types of undertakings, as amended from time to time, including by Directive 2014/95/EU of the European Parliament and of

the Council of 22 October 2014.

d As further specified in the Commission Delegated Regulation (EU) 2021/2178 of 6 July 2021 supplementing Regulation (EU) 2020/852 of the European

Parliament and of the Council by specifying the content and presentation of information to be disclosed by undertakings subject to Articles 19a or 29a of

Directive 2013/34/EU concerning environmentally sustainable economic activities, and specifying the methodology to comply with that disclosure

obligation.

e Taxonomy eligible activities as a proportion of total covered assets is 5.3%, of which: 5.3% relates to the environmental objective of climate change

mitigation and 0% relates to the environmental objective of climate change adaptation.

f The non-NFRD reported figure of 67.5% comprises 58.0% balances with non-NFRD entities and 9.5% balances with entities for which we have not yet been

able to determine based on available information if the entity is in scope of NFRD.

g https://www.eba.europa.eu/eba-updates-lists-regional-governments-and-local-authorities-rglas-and-public-sector-entities-pses

h Voluntary information provided to contextualise and support the readability of the mandatory regulatory disclosures.

The Bank’s taxonomy eligible activities as detailed above amounted to 5.3% of total covered assets as at 31 December 2022. Eligible

activities comprise wholesale lending, of which 3.3% of the portfolio is assessed as taxonomy eligible, financial assets at fair value through

profit and loss, of which 1.2% of the portfolio is assessed as taxonomy eligible and home loans, of which 100% is assessed as taxonomy

eligible. Home loans refers to the Italy mortgage portfolio held on the balance sheet which is in the process of being run off. The remainder

of loans and advances to customers relates to credit cards, unsecured loans and other retail lending which are not taxonomy eligible.

Climate and sustainability

EU Taxonomy

Nuclear energy and fossil gas related disclosures

Pursuant to the Complementary Climate Delegated Act,i the Bank is required to provide information on the share of its balance sheet

associated with certain energy nuclear and fossil gas economic activitiesj. For the financial year ended 31 December 2022, the Bank is

required to (i) indicate whether it carries out, funds or has exposures to certain general nuclear energy and/or fossil gas related activities

and (ii) report on the taxonomy eligibility and non-eligibility of specific nuclear energy and fossil gas economic activities relevant to the

environmental objectives of climate change mitigation and climate change adaptation.


Nuclear energy and fossil gas related disclosures
Nuclear energy related activities
1	The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle.	YES
2	The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best available technologies.	YES
3	The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgrades.	YES
Fossil gas related activities
4	The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels.	YES
5	The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/ cool and power generation facilities using fossil gaseous fuels.	YES
6	The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels.	YES

In light of the EU Commission’s guidance on the Disclosures Delegated Act regarding the primary use of derivative financial instruments as

mitigating risk rather than financing economic activities, the Bank has included counterparties with whom the Bank has exposures to

derivative financial instruments in the table above but excluded those exposures in a) the ‘Taxonomy-eligible but not taxonomy-aligned

economic activities’ table below; and b) rows 1 to 6 of the ‘Taxonomy non-eligible economic activities’ table below. The Bank will continue

to review its approach as the EU Taxonomy regime develops and in the event further guidance is provided by the EU Commission.

Notes

i Commission Delegated Regulation (EU) 2022/1214 of 9 March 2022 amending Delegated Regulation (EU) 2021/2139 as regards economic activities in

certain energy sectors and Delegated Regulation (EU) 2021/2178 as regards specific public disclosures for those economic activities

j Such activities are defined in the Complementary Climate Delegated Act by reference to specific sections of the annexes of the Commission Delegated

Regulation (EU) 2021/2139 of 4 June 2021 supplementing Regulation (EU) 2020/852 of the European Parliament and of the Council by establishing the

technical screening criteria for determining the conditions under which an economic activity qualifies as contributing substantially to climate change mitigation

or climate change adaptation and for determining whether that economic activity causes no significant harm to any of the other environmental objectives

Climate and sustainability

EU Taxonomy


Taxonomy-eligible but not taxonomy-aligned economic activitiesg
Economic activities		Amount and proportion of total covered assets
Amount and proportion of taxonomy-eligible economic activity identified in the denominator of the applicable KPI:		CCM+CCA		Climate change mitigation (CCM)h		Climate change adaptation (CCA)h
		€m	%	€m	%	€m	%
1	Research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle (a)	—	—	—	—	—	—
2	Construction and safe operation of new nuclear installations to produce electricity or process heat using best-available technologies (b)	—	—	—	—	—	—
3	Modification of existing nuclear installations (c)	—	—	—	—	—	—
4	Construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels (d)	—	—	—	—	—	—
5	Construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels (e)	—	—	—	—	—	—
6	Construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels connected to efficient district heating and cooling (f)	—	—	—	—	—	—
7	Amount and proportion of other taxonomy-eligible but not taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	4,763	5.3	4,763	5.3	—	—
8	Total amount and proportion of taxonomy eligible but not taxonomy-aligned economic activities in the denominator of the applicable KPI	4,763	5.3	4,763	5.3	—	—

a.Research, development, demonstration and deployment of innovative electricity generation facilities, licenced by Member States’ competent

authorities in accordance with applicable national law, that produce energy from nuclear processes with minimal waste from the fuel cycle in the

denominator of the applicable KPI. See Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 for full activity description.

b.Amount and proportion of taxonomy-eligible economic activity identified in construction and safe operation of new nuclear installations for which

the construction permit has been issued by 2045 by Member States’ competent authorities, in accordance with applicable national law, to produce

electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production (new nuclear

installations or NNIs), as well as their safety upgrades in the denominator of the applicable KPI. See Section 4.27 of Annexes I and II to Delegated

Regulation 2021/2139 for full activity description.

c.Modification of existing nuclear installations for the purposes of extension, authorised by Member States’ competent authorities by 2040 in

accordance with applicable national law, of the service time of safe operation of nuclear installations that produce electricity or heat from nuclear

energy (‘nuclear power plants’ or ‘NPPs’) in the denominator of the applicable KPI. See Section 4.28 of Annexes I and II to Delegated Regulation

2021/2139 for full activity description.

d.Amount and proportion of taxonomy-eligible economic activity identified in construction or operation of electricity generation facilities that

produce electricity using fossil gaseous fuels. This activity does not include electricity generation from the exclusive use of renewable non-fossil

gaseous and liquid fuels and biogas and bio-liquid fuels in the denominator of the applicable KPI. See Section 4.29 of Annexes I and II to Delegated

Regulation 2021/2139 for full activity description.

e.Amount and proportion of taxonomy-eligible economic activity identified in construction, refurbishment, and operation of combined heat/cool and

power generation facilities using fossil gaseous fuels. This activity does not include high-efficiency co-generation of heat/cool and power from the

exclusive use of renewable non-fossil gaseous and liquid fuels and biogas and bio-liquid fuels in the denominator of the applicable KPI. See Section

4.30 of Annexes I and II to Delegated Regulation 2021/2139 for full activity description.

f.Amount and proportion of taxonomy-eligible economic activity identified in Construction, refurbishment and operation of heat generation facilities

that produce heat/cool using fossil gaseous fuels connected to efficient district heating and cooling. This activity does not include production of

heat/cool in an efficient district heating from the exclusive use of renewable non-fossil gaseous and liquid fuels and biogas and bio-liquid fuels in

the denominator of the applicable KPI. See Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 for full activity description.

g.Reporting on Taxonomy alignment is not required until FY2023. As a result, we have assumed taxonomy-aligned amounts to be zero above.

h.In the absence of published data, taxonomy eligible lending above is assumed to be for CCM and not CCA.

Climate and sustainability

EU Taxonomy


Taxonomy non-eligible economic activities
Economic activities		Amount and proportion of total covered assets
Amount and proportion of economic activity identified in the denominator of the applicable KPI:		€m	%
1	Research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle (a)	—	—
2	Construction and safe operation of new nuclear installations to produce electricity or process heat using best-available technologies (b)	—	—
3	Modification of existing nuclear installations (c)	—	—
4	Construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels (d)	—	—
5	Construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels (e)	—	—
6	Construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels connected to efficient district heating and cooling (f)	—	—
7	Amount and proportion of other taxonomy-non-eligible economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	24,425	27.2
8	Total amount and proportion of taxonomy-non-eligible economic activities in the denominator of the applicable KPI	24,425	27.2