Responsible lending

Banks need to strike a balance between providing access to credit and lending only to those who can repay. We are focussed on matching loans with the ability to repay. In line with our commitment to explore ways to help customers in financial difficulty, we have established specialist teams to engage with customers who have concerns about meeting future financial commitments. Early intervention is beneficial to both the customer and the bank.

We responded to the economic downturn with a series of changes to the way in which we operate our credit card business. These include lower initial credit limits for new customers, a price freeze for 3 million UK customers in 2009 and a new helpline for customers with financial difficulties. In the US, we are working to comply with the new Credit Card Accountability Responsibility and Disclosure Act (CARD) which requires several critical changes in how issuers manage credit card accounts.

Our UK mortgage book has an average Loan-to-Value (LTV) ratio of 43% on a current valuation basis. While remaining conservative in our approach to risk, we have remained competitive in the mortgage market and increased our lending by 7% to £88bn at the end of 2009.

Barclays believes that the repossession route should only be followed as a last resort. In 2009, we had 7% of the total mortgage market but had 0.42% of all repossessions in the UK. We also support UK government initiatives, such as the Homeowner Mortgage Support Scheme, to help financially-stressed customers