Strategic Shareholder Climate and Risk Financial Financial Barclays PLC 356 report information sustainability report Governance review review statements Annual Report 2022 Risk performance - Treasury and Capital risk (continued) On 30 November 2022, the PRA published The securities issued in excess of the Minimum requirements for own its consultation paper 'Implementation of registered amount included structured funds and eligible liabilities the Basel 3.1 standards', which covers the products and exchange traded notes. As The Group is required to meet the higher remaining parts of the Basel III standards these securities were not issued in of: (i) two times the sum of 8% Pillar 1 and to be implemented in the UK. Changes are compliance with the Securities Act, a right 4.3% Pillar 2A equating to 24.5% of RWAs; expected to come in to force from 1 of rescission arose for certain purchasers and (ii) 6.75% of leverage exposures. In January 2025, other than those areas of the securities. A portion of the costs addition, the higher of regulatory capital associated with the right of rescission subject to transitional provisions. Barclays and leverage buffers apply. CET1 capital currently expects the impact on RWAs on were attributable to the financial cannot be counted towards both MREL 1 January 2025 to be at the lower end of statements for the year ended 31 and the buffers, meaning that the buffers, the prior 5-10% RWA inflation guidance. December 2021, resulting in the including the above mentioned The PRA is currently consulting on the rule restatement of the 2021 figures in the confidential institution-specific PRA buffer, disclosures below. changes, and there will be a review of the will effectively be applied above MREL Pillar 2A framework in 2024 which may Prior to the restatement, litigation and requirements. offset some of the impact. conduct charges in the income statement Significant regulatory updates in Leverage in relation to 2021 were underreported by the period £220m (pre-tax). This resulted in a CET1 From 1 January 2022, UK banks became capital decrease of £170m from £47,497m Capital and RWAs subject to a single UK leverage ratio to £47,327m. Both the transitional and fully requirement meaning that the CRR On 1 January 2022, the PRA’s loaded CET1 ratios remained unchanged leverage ratio no longer applies. Under the implementation of Basel III standards took at 15.1% and 14.7% respectively. The T1 revised UK leverage ratio framework, effect including the re-introduction of the ratio moved from 19.2% to 19.1% and the central bank claims have been excluded 100% CET1 capital deduction for qualifying total capital ratio moved from 22.3% to from the UK leverage exposure measure software intangible assets and the 22.2%. where they are matched by qualifying introduction of the Standardised Approach liabilities (rather than deposits). for Counterparty Credit Risk (SA-CCR) The leverage exposure increased £1.9bn which replaces the Current Exposure to recognise on a regulatory basis, the In the disclosures that follow, references Method for Standardised derivative potential commitment relating to the to CRR, as amended by CRR II, mean the exposures as a more risk sensitive rescission offer. This resulted in the UK capital regulatory requirements, as they approach. In addition, the PRA also leverage ratio moving from 5.3% to 5.2% form part of domestic law by virtue of the implemented IRB roadmap changes which whilst the average UK leverage ratio European Union (Withdrawal) Act 2018, as includes revisions to the criteria for remained unchanged at 4.9%. amended. definition of default, probability of default Total own funds and eligible liabilities Impact of Over-issuance of and loss given default estimation to ensure decreased £0.2bn to £108bn, which was in Securities in the US supervisory consistency and increase excess of a restated requirement to hold transparency of IRB models. In March 2022, the Group became aware £94bn of own funds and eligible liabilities. that Barclays Bank PLC had issued securities materially in excess of the amount it had registered with the SEC under Barclays Bank PLC’s 2019 F-3. Subsequently, the Group became aware that securities had also been issued in excess of the amount it had registered with the SEC under the Predecessor Shelf.