Derivative financial instruments and hedge accounting (Tables)

12 Months Ended

Dec. 31, 2018

Summary of Outstanding Derivative Financial Instruments

The Group’s approach to the management of financial risks is set out in note 19. The Group’s outstanding derivative financial instruments are as follows:


	2018							2017
All figures in £ millions	Gross notional amounts		Assets		Liabilities			Gross notional amounts		Assets		Liabilities
Interest rate derivatives – in a fair value hedge relationship		404		13		—			799		23		—
Interest rate derivatives – not in a hedge relationship		362		3		—			429		3		—
Cross-currency rate derivatives – in a hedge relationship		577		51		(35	)		1,522		114		(140	)
FX forwards and collars – in a hedge relationship		434		—		(24	)		—		—		—
Other derivatives – not in a hedge relationship		473		1		—			—		—		—

Total		2,250		68		(59	)		2,750		140		(140	)


Analysed as expiring:
In less than one year		771		1		(23	)		—		—		—
Later than one year and not later than five years		795		22		(1	)		1,638		65		(95	)
Later than five years		684		45		(35	)		1,112		75		(45	)

Total		2,250		68		(59	)		2,750		140		(140	)

Summary of Instruments to Hedge Exposures to Changes in Interest Rates and Foreign Currency Risk Associated with Borrowings

At December 2018, the Group held the following instruments to hedge exposures to changes in interest rates and foreign currency risk associated with borrowings.

All figures in £ millions

Carrying amount of
hedging instruments

Change in fair value of hedging
instrument used to determine hedge
ineffectiveness

Nominal amounts of hedging
instruments

Interest rate risk

Financial assets – derivative financial instruments

)

404

Currency risk

Financial assets – derivative financial instruments

404

Summary of Amounts at the Reporting Rate Relating to Items Designated as Hedge Items

The amounts at the reporting date relating to items designated as hedge items were as follows:

All figures in £ millions

Carrying amount of
hedged items

Accumulated amount
of fair value hedge
adjustments on the
hedged item included
in the carrying
amount

Change in fair value of
hedged item used to
determine hedge
ineffectiveness

Hedge
ineffectiveness

Line item in profit or
loss that includes
hedge ineffectiveness

Interest rate risk

Financial liabilities – borrowings

(416

)

—

n/a

Currency risk

Financial liabilities – borrowings

(416

)

n/a

)

—

n/a

Summary of Amounts Related to Items Designated as Hedging Instruments

The amounts related to items designated as hedging instruments were as follows.

All figures in £ millions

Carrying amount of
hedged instruments

Change in value of
hedging instrument
used to determine
hedge
ineffectiveness

Nominal amounts of
hedging instruments

Hedging gains/(losses)
recognised in OCI

Hedge ineffectiveness
recognised in profit or
loss

Financial liabilities – derivative financial instruments

(59

)

(22

)

607

(22

)

—

Financial liabilities – borrowings

(256

)

(10

)

(256

)

(10

)

—

Disclosure of Derivative Financial Assets and Liabilities Subject to Offsetting Arrangements

Derivative financial assets and liabilities subject to offsetting arrangements are as follows


	2018								2017
All figures in £ millions	Gross derivative assets		Gross derivative liabilities			Net derivative assets/ liabilities			Gross derivative assets		Gross derivative liabilities			Net derivative assets/ liabilities
Counterparties in an asset position		67		(44	)		23			103		(78	)		25
Counterparties in a liability position		1		(15	)		(14	)		37		(62	)		(25	)

Total as presented in the balance sheet		68		(59	)		9			140		(140	)		—