Company: BCS
Filing Date: 2025-02-13
Form Type: 20-F
Source: 0000312069-25-000114
Chunk: 122

Company: BARCLAYS PLC
Filing Date: 2025-02-13
Form: 20-F
Chunk 122
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 not intervene in the insurance markets and the UK Government&#8217;s Flood Re scheme expires in 2039 as currently planned. This resulted in many customers and clients, either not insuring, self-insuring or facing significantly higher insurance premiums, driving affordability constraints and significant asset devaluation. Results and insights Three sensitivities related to increasing the proportion of the portfolio impacted were tested for the Corporate, Mortgages and Structured Lending and Financing portfolio, reflecting the high level of uncertainty of the scenario. The Group&#8217;s business model could reach non-viability in the two most extreme cases which tested our vulnerability to profit and Risk Weighted Assets. The exercise highlighted how the portfolios could be the major driver of losses in a climate scenario, particularly due to physical risk. For UK mortgages in particular, the exercise provided valuable insights of the potential effects of the Flood Re reinsurance scheme expiring, particularly in customers that currently see a lower insurance premium due to the scheme. For the Corporates portfolio, results highlighted how the portfolio is exposed to both fast and slow transition risks, and for physical risk, how secondary perils could strain the portfolio if they drive repeated loss claims that insurance companies struggle to price and model. For our Structured Lending and Financing portfolio, the exercise pointed out that extreme tail risk is driven by commensurately severe devaluation of properties in certain US states. Nature Exploratory Stress Test During 2024, the Bank undertook a Nature Exploratory Stress Test (NEST) to assess the vulnerability and resilience of Barclays Europe's portfolio to environment-related shocks. The NEST exercise was conducted as an incremental exercise to the internal stress test and focused on credit, market, liquidity and operational risk categories. The nature scenario narrative and five- year horizon aligned to the Internal Supply chain scenario published by Green Finance Institute in February 2024. The scenario also leveraged the Network for Greening the Financial System recommendations on selected risk drivers and transmission channels. Results and insights Over the five-year period, the results of the exercise indicated an adverse impact to Barclays Europe, due to clients operating in TNFD nature priority sectors such as Automotive, Chemicals, Food, Bev and Tobacco. However, these impacts Strategy Shareholder information Climate and sustainability report Governance Risk review Financial review Financial statements Barclays PLC 2024 Annual Report on Form 20-F 59 Resilience of our strategy (continued) TCFD Strategy Recommendation C

are manageable within the bank's existing risk profile. 2024 Enhancements During 2024