Strategic Shareholder Climate and Risk Financial Financial Barclays PLC 347 report information sustainability report Governance review review statements Annual Report 2022 Risk performance - Treasury and Capital risk (continued) The Group liquidity pool is well diversified by major currency and the Group monitors LRA stress scenarios for major currencies. Liquidity pool by currency USD EUR GBP Other Total £bn £bn £bn £bn £bn Liquidity pool as at 31 December 2022 72 79 142 25 318 Liquidity pool as at 31 December 2021 59 52 132 48 291 Management of the liquidity pool The composition of the liquidity pool is subject to limits set by the Board and the independent liquidity risk, credit risk and market risk functions. In addition, the investment of the liquidity pool is monitored for concentration risk by issuer, currency and asset type. Given the returns generated by these highly liquid assets, the risk and reward profile is continuously managed. As at 31 December 2022, 60% (2021: 58%) of the liquidity pool was located in Barclays Bank PLC, 25% (2021: 30%) in Barclays Bank UK PLC and 9% (2021: 7%) in Barclays Bank Ireland PLC. The residual portion of the liquidity pool is held outside of these entities, predominantly in the US subsidiaries, to meet entity-specific stress outflows and local regulatory requirements. To the extent the use of this portion of the liquidity pool is restricted due to local regulatory requirements, it is assumed to be unavailable to the rest of the Group in calculating the LCR. Contingent liquidity In addition to the Group liquidity pool, the Group has access to other unencumbered assets which provide a source of contingent liquidity. While these are not relied on in the Group’s LRA, a portion of these assets may be monetised in a stress to generate liquidity through their use as collateral for secured funding or through outright sale. In a Barclays-specific, market-wide or combined liquidity stress, liquidity available via market sources could be severely disrupted. In circumstances where market liquidity is unavailable or available only at significantly elevated prices, the Group could generate liquidity via central bank facilities. To this end, as at 31 December 2022, the Group had £83.3bn (December 2021: £93.3bn) of assets positioned at various central banks. For more detail on the Group’s other unencumbered assets, see pages 180 to 182 of the Barclays PLC Pillar 3 Report 2022 (unaudited). Funding structure and funding relationships The basis for sound liquidity risk management is a funding structure that reduces the probability of a liquidity stress leading to an inability to meet funding obligations as they fall due. The Group’s overall funding strategy is to develop a diversified funding base (geographically, by type and by counterparty) and maintain access to a variety of alternative funding sources, to provide protection against unexpected fluctuations, while minimising the cost of funding. Within this, the Group aims to align the sources and uses of funding. As such, retail and corporate loans and advances are largely funded by deposits in the relevant entities, with the surplus primarily funding the liquidity pool. The majority of reverse repurchase agreements are matched by repurchase agreements. Derivative liabilities and assets are largely matched. A substantial proportion of balance sheet derivative positions qualify for counterparty netting and the remaining portions are largely offset when netted against cash collateral received and paid. Wholesale debt and equity is used to fund residual assets. These funding relationships are summarised below: c Restated 2022 2021 2022 2021 Assets Liabilities £bn £bn £bn £bn Loans and advances at amortised a cost 385 358 Deposits at amortised cost 546 519 Group liquidity pool 318 291 1 Year wholesale funding 111 101 Reverse repurchase agreements, Repurchase agreements, trading trading portfolio assets, cash collateral portfolio liabilities, cash collateral and and settlement balances 412 388 settlement balances 370 330 Derivative financial instruments 302 263 Derivative financial instruments 290 257 b Other assets 97 84 Other liabilities 55 40 Equity 69 70 Total assets 1,514 1,384 Total liabilities 1,514 1,384 Notes a Adjusted for liquidity pool debt securities reported at amortised costs of £14bn (December 2021: £3bn). b Other assets include fair value assets that are not part of reverse repurchase agreements or trading portfolio assets, and other asset categories. c 2021 financial and capital metrics have been restated to reflect the impact of the Over-issuance of Securities. See Impact of the Over-issuance of Securities on page 356 and Restatement of financial statements (Note 1a) on page 428 for further details.