Strategic Shareholder Climate and Risk Financial Financial Barclays PLC 468 report information sustainability report Governance review review statements Annual Report 2022 Notes to the financial statements (continued) Assets and liabilities held at fair value 18 Offsetting financial assets and financial liabilities In accordance with IAS 32 Financial Instruments: Presentation, the Group reports financial assets and financial liabilities on a net basis on the balance sheet only if there is a legally enforceable right to set-off the recognised amounts and there is intention to settle on a net basis, or to realise the asset and settle the liability simultaneously. The following table shows the impact of netting arrangements on: ▪ all financial assets and liabilities that are reported net on the balance sheet ▪ all derivative financial instruments and reverse repurchase and repurchase agreements and other similar secured lending and borrowing agreements that are subject to enforceable master netting arrangements or similar agreements, but do not qualify for balance sheet netting. The ‘Net amounts’ presented are not intended to represent the Group’s actual exposure to credit risk, as a variety of credit mitigation strategies are employed in addition to netting and collateral arrangements. Amounts subject to enforceable netting arrangements Effects of offsetting on-balance sheet Related amounts not offset Amounts not Net amounts subject to reported on enforceable Amounts the balance Financial Financial netting Balance sheet a b c d Gross amounts offset sheet instruments collateral Net amount arrangements total £m £m £m £m £m £m £m £m As at 31 December 2022 Derivative financial assets 374,253 (76,429) 297,824 (238,337) (45,981) 13,506 4,556 302,380 Reverse repurchase agreements and e other similar secured lending 558,977 (396,323) 162,654 — (162,024) 630 2,803 165,457 Total assets 933,230 (472,752) 460,478 (238,337) (208,005) 14,136 7,359 467,837 Derivative financial liabilities (360,630) 76,530 (284,100) 238,337 26,639 (19,124) (5,520) (289,620) Repurchase agreements and other e similar secured borrowing (571,774) 396,323 (175,451) — 175,451 — (24,347) (199,798) Total liabilities (932,404) 472,853 (459,551) 238,337 202,090 (19,124) (29,867) (489,418) As at 31 December 2021 Derivative financial assets 279,568 (24,137) 255,431 (202,519) (40,485) 12,427 7,141 262,572 Reverse repurchase agreements and e other similar secured lending 514,360 (370,003) 144,357 — (143,854) 503 3,884 148,241 Total assets 793,928 (394,140) 399,788 (202,519) (184,339) 12,930 11,025 410,813 Derivative financial liabilities (274,356) 23,606 (250,750) 202,519 34,321 (13,910) (6,133) (256,883) Repurchase agreements and other e similar secured borrowing (535,653) 370,003 (165,650) — 165,650 — (30,762) (196,412) Total liabilities (810,009) 393,609 (416,400) 202,519 199,971 (13,910) (36,895) (453,295) Notes a Amounts offset for derivative financial assets additionally includes cash collateral netted of £15,199m (2021: £3,815m). Amounts offset for derivative financial liabilities additionally includes cash collateral netted of £15,098m (2021: £4,346m). Settlements assets and liabilities have been offset amounting to £24,250m (2021: £22,837m). b Financial collateral of £45,981m (2021: £40,485m) was received in respect of derivative assets, including £34,547m (2021: £34,598m) of cash collateral and £11,434m (2021: £5,887m) of non-cash collateral. Financial collateral of £26,639m (2021: £34,321m) was placed in respect of derivative liabilities, including £25,222m (2021: £32,031m) of cash collateral and £1,417m (2021: £2,290m) of non- cash collateral. The collateral amounts are limited to net balance sheet exposure so as to not include overcollateralisation. c This column includes contractual rights of set-off that are subject to uncertainty under the laws of the relevant jurisdiction. d The balance sheet total is the sum of ‘Net amounts reported on the balance sheet’ that are subject to enforceable netting arrangements and ‘Amounts not subject to enforceable netting arrangements’. e Reverse repurchase agreements and other similar secured lending of £165,457m (2021: £148,241m) is split by fair value £164,681m (2021: £145,014m) and amortised cost £776m (2021: £3,227m). Repurchase agreements and other similar secured borrowing of £199,798m (2021: £196,412m) is split by fair value £172,746m (2021: £168,060m) and amortised cost £27,052m (2021: £28,352m). Derivative assets and liabilities The ‘Financial instruments’ column identifies financial assets and liabilities that are subject to set-off under netting agreements, such as the ISDA Master Agreement or derivative exchange or clearing counterparty agreements, whereby all outstanding transactions with the same counterparty can be offset and close-out netting applied across all outstanding transactions covered by the agreements if an event of default or other predetermined events occur. Financial collateral refers to cash and non-cash collateral obtained, typically daily or weekly, to cover the net exposure between counterparties by enabling the collateral to be realised in an event of default or if other predetermined events occur. Repurchase and reverse repurchase agreements and other similar secured lending and borrowing The ‘Financial instruments’ column identifies financial assets and liabilities that are subject to set-off under netting agreements, such as Global Master Repurchase Agreements and Global Master Securities Lending Agreements, whereby all outstanding transactions with the same counterparty can be offset and close-out netting applied across all outstanding transactions covered by the agreements if an event of default or other predetermined events occur. Financial collateral typically comprises highly liquid securities which are legally transferred and can be liquidated in the event of counterparty default. These offsetting and collateral arrangements and other credit risk mitigation strategies used by the Group are further explained in the Credit risk management section.