Strategic Shareholder Climate and Risk Financial Financial Barclays PLC 346 report information sustainability report Governance review review statements Annual Report 2022 Risk performance - Treasury and Capital risk (continued) Liquidity coverage ratio The external LCR requirement is designed to promote short-term resilience of a bank’s liquidity risk profile by holding sufficient High Quality Liquid Assets (HQLA) to survive an acute stress scenario lasting for 30 days. 2022 2021 As at 31 December £bn £bn LCR Eligible High Quality Liquid Assets (HQLA) 295 285 Net stress outflows (178) (169) Surplus 117 116 Liquidity coverage ratio 165 % 168 % Net Stable Funding Ratio (NSFR) The external NSFR metric requires banks to maintain a stable funding profile taking into account both on and certain off balance sheet exposures over a medium to long term period. The ratio is defined as the Available Stable Funding (capital and certain liabilities which are defined as stable sources of funding) relative to the Required Stable Funding (assets on balance sheet and certain off balance sheet exposures). The NSFR was 137% at December 2022 (average of last four quarter ends) equivalent to a surplus of £155bn above the regulatory requirement and demonstrates Barclays’ stable funding profile in relation to our on- and certain off-balance sheet activities. 2022 a Net Stable Funding Ratio (NSFR) £bn Total Available Stable Funding 576 Total Required Stable Funding 421 Surplus 155 Net Stable Funding Ratio 137 % Note a Average represents the last four spot quarter end positions As part of the liquidity risk appetite, Barclays establishes minimum LCR, NSFR and internal liquidity stress test limits. The Group plans to maintain its surplus to the internal and regulatory requirements at an efficient level. Risks to market funding conditions, the Group’s liquidity position and funding profile are assessed continuously, and actions are taken to manage the size of the liquidity pool and the funding profile as appropriate. Liquidity pool The Group liquidity pool as at 31 December 2022 was £318bn (2021: £291bn). During 2022, the month-end liquidity pool ranged from £309bn to £359bn (2021: £290bn to £337bn), and the month-end average balance was £331bn (2021: £303bn). The liquidity pool is held unencumbered and is intended to offset stress outflows. It comprises the following cash and unencumbered assets. Composition of the Group liquidity pool as at 31 December 2022 a LCR eligible High Quality Liquid Assets (HQLA) Liquidity pool Cash Level 1 Level 2A Level 2B Total 2022 2021 £bn £bn £bn £bn £bn £bn £bn b Cash and deposits with central banks 248 248 263 245 c Government bonds AAA to AA- — 21 10 — 31 39 26 A+ to A- — 1 2 — 3 3 2 BBB+ to BBB- — — — — — — — Total government bonds — 22 12 — 34 42 28 Other Government guaranteed issuers, PSEs and GSEs — 5 1 — 6 6 6 International organisations and MDBs — 2 — — 2 2 5 Covered bonds — 2 2 — 4 5 6 Other — — — 1 1 — 1 Total other — 9 3 1 13 13 18 Total as at 31 December 2022 248 31 15 1 295 318 Total as at 31 December 2021 243 37 3 2 285 291 Notes a The LCR eligible HQLA is adjusted for operational restrictions upon consolidation under Article 8 of the Liquidity Coverage Ratio section of the PRA rulebook (CRR) such as trapped liquidity within Barclays subsidiaries. It also reflects differences in eligibility of assets between the LCR and Barclays’ Liquidity Pool. b Includes cash held at central banks and surplus cash at central banks related to payment schemes. Of which over 99% (2021: over 99%) was placed with the Bank of England, US Federal Reserve, European Central Bank, Bank of Japan and Swiss National Bank. c Of which over 79% (2021: over 82%) comprised UK, US, French, German, Japanese, Swiss and Dutch securities.