Company: BCS
Filing Date: 2025-02-13
Form Type: 20-F
Source: 0000312069-25-000114
Chunk: 411

Company: BARCLAYS PLC
Filing Date: 2025-02-13
Form: 20-F
Chunk 411
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 to call on collateral in the event of default of the counterparty, comprising: • home loans: a fixed charge over residential property in the form of houses, flats and other dwellings • wholesale lending: a fixed charge over commercial property and other physical assets, in various forms • other retail lending: includes charges over other physical assets; second lien charges over residential property; and finance lease receivables • derivatives: the Group also often seeks to enter into a margin agreement (e.g. Credit Support Annex) with counterparties with which the Group has master netting agreements in place. These annexes to master agreements provide a mechanism for further reducing credit risk, whereby collateral (margin) is posted on a regular basis (typically daily) to collateralise the mark to market exposure of a derivative portfolio measured on a net basis • reverse repurchase agreements: collateral typically comprises highly liquid securities which have been legally transferred to the Group subject to an agreement to return them for a fixed price • financial guarantees and similar off- balance sheet commitments: cash collateral may be held against these arrangements. Risk transfer A range of instruments including guarantees, credit insurance, credit derivatives and securitisation can be used to transfer credit risk from one counterparty to another. These mitigate credit risk in three main ways: • if the risk is transferred to a counterparty which is more creditworthy than the original counterparty, then overall credit risk is reduced • where recourse to the first counterparty remains, both counterparties must default before a loss materialises. This is less likely than the default of either counterparty individually so credit risk is reduced • first loss exposures across pools of credit risk can be hedged via synthetic securitisation structures, typically via CLN (credit lending notes) issuance. As these are fully funded upfront they provide for a direct reduction in credit risk exposure on referenced pools.

| Detailed policies are in place to appropriately recogniseand record credit risk mitigation. For more information,refer topages 132to135of the Barclays PLC Pillar 3Report 2024 (unaudited). |

Governance and oversight of ECLs under IFRS 9 The Group’s organisational structure and internal governance processes oversee the estimation of ECL across several areas, including: i) setting requirements in policy, including key assumptions and the application of key judgements; ii) the design and execution of models; and iii) review of ECL results. i) Impairment policy requirements are set and reviewed regularly, at a minimum annually, to maintain adherence to