|
|
|
30 June 2020
|
|
31 December 2019
|
|||||||||||||||||||
|
Notional
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
GBP
|
USD
|
Euro
|
Other
|
Total
|
Assets
|
Liabilities
|
|
Notional
|
Assets
|
Liabilities
|
|||||||||||
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£m
|
£m
|
|
£bn
|
£m
|
£m
|
|||||||||||
Gross exposure
|
|
|
|
|
|
195,492
|
192,888
|
|
|
160,942
|
158,603
|
|||||||||||
IFRS offset
|
|
|
|
|
|
(12,073)
|
(13,029)
|
|
|
(10,913)
|
(11,724)
|
|||||||||||
Carrying value
|
3,929
|
5,042
|
5,931
|
1,951
|
16,853
|
183,419
|
179,859
|
|
15,063
|
150,029
|
146,879
|
|||||||||||
Of which:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Interest rate (1)
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Interest rate
swaps
|
|
|
|
|
|
112,520
|
106,842
|
|
|
89,646
|
86,123
|
|||||||||||
Options
purchased
|
|
|
|
|
|
26,614
|
-
|
|
|
15,300
|
-
|
|||||||||||
Options
written
|
|
|
|
|
|
-
|
26,463
|
|
|
-
|
13,198
|
|||||||||||
Futures and
forwards
|
|
|
|
|
|
3
|
3
|
|
|
11
|
10
|
|||||||||||
Total
|
3,560
|
3,428
|
5,312
|
905
|
13,205
|
139,137
|
133,308
|
|
11,293
|
104,957
|
99,331
|
|||||||||||
Exchange rate
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Spot, forwards and
futures
|
|
|
|
|
|
25,169
|
25,250
|
|
|
30,348
|
30,728
|
|||||||||||
Currency
swaps
|
|
|
|
|
|
12,442
|
13,894
|
|
|
8,795
|
10,296
|
|||||||||||
Options
purchased
|
|
|
|
|
|
6,475
|
-
|
|
|
5,649
|
-
|
|||||||||||
Options
written
|
|
|
|
|
|
-
|
7,019
|
|
|
-
|
6,117
|
|||||||||||
Total
|
367
|
1,607
|
610
|
1,046
|
3,630
|
44,086
|
46,163
|
|
3,750
|
44,792
|
47,141
|
|||||||||||
Credit
|
2
|
5
|
9
|
-
|
16
|
177
|
370
|
|
17
|
280
|
359
|
|||||||||||
Equity and commodity
|
-
|
2
|
-
|
-
|
2
|
19
|
18
|
|
3
|
-
|
48
|
|||||||||||
Carrying value
|
|
|
|
|
16,853
|
183,419
|
179,859
|
|
15,063
|
150,029
|
146,879
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Counterparty mark-to-market netting
|
|
|
|
|
|
(150,183)
|
(150,183)
|
|
|
(122,697)
|
(122,697)
|
|||||||||||
Cash collateral
|
|
|
|
|
|
(22,739)
|
(20,306)
|
|
|
(18,685)
|
(17,296)
|
|||||||||||
Securities collateral
|
|
|
|
|
|
(5,654)
|
(2,966)
|
|
|
(4,292)
|
(1,276)
|
|||||||||||
Net exposure
|
|
|
|
|
|
4,843
|
6,404
|
|
|
4,355
|
5,610
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Banks (2)
|
|
|
|
|
|
296
|
686
|
|
|
621
|
857
|
|||||||||||
Other financial institutions (3)
|
|
|
|
|
|
1,549
|
3,884
|
|
|
1,020
|
4,088
|
|||||||||||
Corporate (4)
|
|
|
|
|
|
2,783
|
1,721
|
|
|
2,452
|
639
|
|||||||||||
Government (5)
|
|
|
|
|
|
215
|
113
|
|
|
262
|
26
|
|||||||||||
Net exposure
|
|
|
|
|
|
4,843
|
6,404
|
|
|
4,355
|
5,610
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
UK
|
|
|
|
|
|
3,156
|
3,971
|
|
|
2,052
|
3,153
|
|||||||||||
Europe
|
|
|
|
|
|
1,023
|
1,537
|
|
|
1,393
|
1,898
|
|||||||||||
US
|
|
|
|
|
|
315
|
599
|
|
|
428
|
331
|
|||||||||||
RoW
|
|
|
|
|
|
349
|
297
|
|
|
482
|
228
|
|||||||||||
Net exposure
|
|
|
|
|
|
4,843
|
6,404
|
|
|
4,355
|
5,610
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Asset quality of uncollateralised derivative assets
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
AQ1-AQ4
|
|
|
|
|
|
3,706
|
|
|
|
3,361
|
|
|||||||||||
AQ5-AQ8
|
|
|
|
|
|
981
|
|
|
|
972
|
|
|||||||||||
AQ9-AQ10
|
|
|
|
|
|
156
|
|
|
|
22
|
|
|||||||||||
Net exposure
|
|
|
|
|
|
4,843
|
|
|
|
4,355
|
|
|
Central and local government
|
Financial
|
|
|
||
|
UK
|
US
|
Other
|
institutions
|
Corporate
|
Total
|
30 June 2020
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
AAA
|
-
|
-
|
2,265
|
934
|
3
|
3,202
|
AA to AA+
|
-
|
4,570
|
3,377
|
678
|
52
|
8,677
|
A to AA-
|
4,515
|
-
|
1,608
|
345
|
85
|
6,553
|
BBB- to A-
|
-
|
-
|
4,773
|
625
|
1,064
|
6,462
|
Non-investment grade
|
-
|
-
|
58
|
149
|
90
|
297
|
Unrated
|
-
|
-
|
-
|
328
|
43
|
371
|
Total
|
4,515
|
4,570
|
12,081
|
3,059
|
1,337
|
25,562
|
Short positions
|
(4,210)
|
(1,801)
|
(12,883)
|
(1,442)
|
(122)
|
(20,458)
|
|
|
|
|
|
|
|
31 December 2019
|
|
|
|
|
|
|
AAA
|
-
|
-
|
2,197
|
1,188
|
5
|
3,390
|
AA to AA+
|
4,897
|
5,458
|
2,824
|
333
|
87
|
13,599
|
A to AA-
|
-
|
-
|
3,297
|
755
|
109
|
4,161
|
BBB- to A-
|
-
|
-
|
6,508
|
872
|
895
|
8,275
|
Non-investment grade
|
-
|
-
|
76
|
298
|
150
|
524
|
Unrated
|
-
|
-
|
-
|
420
|
48
|
468
|
Total
|
4,897
|
5,458
|
14,902
|
3,866
|
1,294
|
30,417
|
Short positions
|
(4,340)
|
(1,392)
|
(13,749)
|
(1,620)
|
(86)
|
(21,187)
|
●
|
The outbreak of
Covid-19 triggered exceptional volatility in non-traded market risk
factors in March 2020 and a global sell-off across all asset
classes. This notably affected credit spreads (the spread between
bond yield and swap rates) arising from the liquidity portfolios
held by Treasury and resulted in a sharp increase in total
non-traded VaR for H1 2020.
|
●
|
The Bank of England
cut the UK base rate in March 2020, from 0.75% to 0.10%. In
response, NatWest Group reduced customer deposit rates, but by less
than the cut in base rate, resulting in margin compression. Given
the very low levels of interest rates, scope to reduce deposit
rates is constrained.
|
●
|
The five-year
sterling interest rate swap rate fell to 0.13% at 30 June 2020 from
0.81% at 31 December 2019. The corresponding ten-year rate fell to
0.25% from 0.93%. The structural hedge provides some protection
against volatility in interest rates. As a result, the move in the
structural hedge yield over the same period was less material,
falling to 1.12% from 1.18%.
|
●
|
During H1 2020,
NatWest Group continued to make progress on the transition from
LIBOR to alternative risk-free rates. An increasing proportion of
structural hedges and hedges of other portfolios are written
against swaps linked to SONIA, instead of
LIBOR.
|
●
|
Sterling weakened
against both the US dollar and the euro over the period. Against
the dollar, sterling was 1.24 at 30 June 2020 compared to 1.32 at
31 December 2019. Against the euro, it was 1.10 at 30 June 2020
compared to 1.18 at 31 December 2019. Structural foreign currency
exposures increased, in sterling equivalent terms, by £653
million over the period.
|
|
Half year ended
|
|
|||||||||||||||||
|
30 June 2020
|
|
30 June 2019
|
|
31 December 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period
|
|
|
|
|
Period
|
|
|
|
|
Period
|
|
||||
|
Average
|
Maximum
|
Minimum
|
end
|
|
Average
|
Maximum
|
Minimum
|
end
|
|
Average
|
Maximum
|
Minimum
|
end
|
|
||||
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
||||
Interest rate
|
12.8
|
16.9
|
8.0
|
16.9
|
|
11.9
|
14.0
|
9.3
|
9.9
|
|
10.1
|
12.8
|
8.0
|
8.2
|
|
||||
Euro
|
1.7
|
2.8
|
1.3
|
1.3
|
|
1.2
|
1.8
|
0.7
|
1.8
|
|
1.5
|
2.3
|
1.1
|
1.3
|
|||||
Sterling
|
10.7
|
15.8
|
6.6
|
15.8
|
|
11.5
|
14.1
|
9.5
|
9.9
|
|
10.0
|
12.4
|
8.0
|
8.0
|
|||||
US dollar
|
9.6
|
12.9
|
5.9
|
12.0
|
|
4.7
|
6.0
|
3.8
|
3.8
|
|
4.5
|
5.7
|
3.4
|
5.2
|
|||||
Other
|
0.7
|
0.9
|
0.5
|
0.5
|
|
0.3
|
0.4
|
0.2
|
0.4
|
|
0.4
|
0.7
|
0.3
|
0.7
|
|||||
Credit spread
|
99.6
|
121.1
|
63.7
|
114.7
|
|
54.9
|
58.0
|
49.2
|
56.6
|
|
56.3
|
59.7
|
53.6
|
59.7
|
|
||||
Structural foreign
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
exchange
rate
|
11.9
|
14.7
|
9.8
|
14.7
|
|
20.0
|
23.8
|
7.2
|
7.2
|
|
10.4
|
12.5
|
8.6
|
8.6
|
|
||||
Equity
|
30.6
|
33.5
|
25.3
|
31.6
|
|
38.6
|
38.6
|
38.6
|
38.6
|
|
33.8
|
38.4
|
31.6
|
33.5
|
|
||||
Pipeline risk (1)
|
0.5
|
0.7
|
0.3
|
0.5
|
|
0.3
|
0.5
|
0.2
|
0.3
|
|
0.4
|
0.9
|
0.2
|
0.2
|
|
||||
Diversification (2)
|
(28.6)
|
|
|
(25.8)
|
|
(70.5)
|
|
|
(50.7)
|
|
(47.0)
|
|
|
(45.6)
|
|
||||
Total
|
126.8
|
159.9
|
70.8
|
152.6
|
|
55.2
|
61.9
|
48.1
|
61.9
|
|
64.0
|
64.6
|
63.0
|
64.6
|
|
(1)
|
Pipeline
risk is the risk of loss arising from Personal customers owning an
option to draw down a loan – typically a mortgage – at
a committed rate, where interest rate changes may result in greater
or fewer customers than anticipated taking up the committed
offer.
|
(2)
|
NatWest
Group benefits from diversification across various financial
instrument types, currencies and markets. The extent of the
diversification benefit depends on the correlation between the
assets and risk factors in the portfolio at a particular time. The
diversification factor is the sum of the VaR on individual risk
types less the total portfolio VaR.
|
|
|
||||||||||||||||
|
Half year ended
|
||||||||||||||||
|
30 June 2020
|
|
30 June 2019
|
|
31 December 2019
|
||||||||||||
|
|
|
Period
|
|
|
|
|
|
Period
|
|
|
|
|
|
Period
|
|
|
|
Incremental
|
Total
|
-end
|
Average
|
Total
|
|
Incremental
|
Total
|
-end
|
Average
|
Total
|
|
Incremental
|
Total
|
-end
|
Average
|
Total
|
|
income
|
income
|
notional
|
notional
|
yield
|
|
income
|
income
|
notional
|
notional
|
yield
|
|
income
|
income
|
notional
|
notional
|
yield
|
|
£m
|
£m
|
£bn
|
£bn
|
%
|
|
£m
|
£m
|
£bn
|
£bn
|
%
|
|
£m
|
£m
|
£bn
|
£bn
|
%
|
Equity structural
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
hedging
|
209
|
294
|
24
|
25
|
2.39
|
|
197
|
332
|
29
|
29
|
2.31
|
|
201
|
312
|
25
|
26
|
2.41
|
Product structural
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
hedging
|
146
|
503
|
114
|
112
|
0.90
|
|
82
|
558
|
111
|
111
|
1.01
|
|
102
|
536
|
111
|
111
|
0.97
|
Other structural
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
hedging
|
42
|
78
|
20
|
20
|
0.78
|
|
27
|
84
|
21
|
21
|
0.79
|
|
33
|
82
|
21
|
21
|
0.79
|
Total
|
397
|
875
|
158
|
157
|
1.12
|
|
306
|
974
|
161
|
161
|
1.21
|
|
336
|
930
|
157
|
158
|
1.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Half year ended
|
||
|
30 June
|
30 June
|
31 December
|
|
2020
|
2019
|
2019
|
|
£m
|
£m
|
£m
|
UK Personal Banking
|
66
|
38
|
47
|
Commercial Banking
|
80
|
44
|
55
|
Total
|
146
|
82
|
102
|
|
|
|
|
●
|
The
five-year sterling swap rate fell to 0.13% at the end of June 2020
from 0.81% at December 2019. The ten-year sterling swap rate also
fell, to 0.25% from 0.93%. The yield of the structural hedge fell
as new product hedges and maturing hedges across the portfolio were
reinvested at lower market rates. At 1.12% the overall yield was
still higher than market swap rates at 30 June 2020.
|
●
|
Incremental
income in excess of three-month LIBOR continued to increase. This
was primarily due to lower three-month LIBOR fixings, resulting in
more income benefit from the hedge.
|
|
Parallel shifts in yield curve
|
|||
|
+25 basis points
|
-25 basis points
|
+100 basis points
|
-100 basis points
|
30 June 2020
|
£m
|
£m
|
£m
|
£m
|
Euro
|
2
|
-
|
78
|
-
|
Sterling
|
321
|
(143)
|
1,018
|
(147)
|
US dollar
|
20
|
(19)
|
84
|
(17)
|
Other
|
2
|
-
|
11
|
-
|
Total
|
345
|
(162)
|
1,191
|
(164)
|
|
|
|
|
|
30 June 2019
|
|
|
|
|
Euro
|
23
|
5
|
88
|
9
|
Sterling
|
201
|
(142)
|
707
|
(706)
|
US dollar
|
15
|
(9)
|
51
|
(52)
|
Other
|
(2)
|
2
|
(9)
|
15
|
Total
|
237
|
(144)
|
837
|
(734)
|
|
|
|
|
|
31 December 2019
|
|
|
|
|
Euro
|
25
|
(2)
|
129
|
(3)
|
Sterling
|
172
|
(158)
|
716
|
(706)
|
US dollar
|
16
|
(11)
|
66
|
(52)
|
Other
|
(1)
|
1
|
(3)
|
5
|
Total
|
212
|
(170)
|
908
|
(756)
|
|
|
||||||
|
+25 basis points parallel upward shift
|
|
-25 basis points parallel downward shift
|
||||
|
Year 1
|
Year 2 (1)
|
Year 3 (1)
|
|
Year 1
|
Year 2 (1)
|
Year 3 (1)
|
30 June 2020
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
Structural hedges
|
31
|
97
|
169
|
|
(17)
|
(59)
|
(114)
|
Managed margin (2)
|
323
|
348
|
348
|
|
(134)
|
(72)
|
(87)
|
Other
|
(8)
|
|
|
|
(11)
|
|
|
Total
|
346
|
445
|
517
|
|
(162)
|
(131)
|
(201)
|
|
|
|
|
|
|
|
|
31 December 2019
|
|
|
|
|
|
|
|
Structural hedges
|
31
|
97
|
168
|
|
(27)
|
(90)
|
(154)
|
Managed margin (2)
|
195
|
195
|
196
|
|
(158)
|
(127)
|
(128)
|
Other
|
(14)
|
|
|
|
15
|
|
|
Total
|
212
|
292
|
364
|
|
(170)
|
(217)
|
(282)
|
|
|
|
|
|
|
|
|
●
|
The
increased favourable sensitivity to the 25 and 100-basis-point
downward shifts in yield curves over H1 2020 was mainly driven by
(i) the significantly increased volumes of savings and current
accounts over the period and (ii) changes to estimates of the
extent to which NatWest Group passes through the impact of changes
in interest rates to these products. These estimates are regularly
reviewed and are influenced by the overall level of interest rates,
NatWest Group’s competitive position and other strategic
considerations.
|
●
|
The
sensitivity to the 25 and 100-basis-point downward shift in yield
curves was also significantly affected by the changes to the level
of interest rates. In the shock scenario, rates fell less at 30
June 2020 before hitting an assumed 0% floor compared to 31
December 2019. This resulted in a lower adverse impact at 30 June
2020, which was particularly notable in the 100-basis-point
downward shock.
|
|
|
|
Structural
|
|
|
|
Net
|
|
foreign currency
|
|
Residual
|
|
investments
|
Net
|
exposures
|
|
structural
|
|
in foreign
|
investment
|
pre-economic
|
Economic
|
foreign currency
|
|
operations
|
hedges
|
hedges
|
hedges (1)
|
exposures
|
30 June 2020
|
£m
|
£m
|
£m
|
£m
|
£m
|
US dollar
|
1,651
|
(113)
|
1,538
|
(1,538)
|
-
|
Euro
|
6,552
|
(701)
|
5,851
|
-
|
5,851
|
Other non-sterling
|
1,311
|
(398)
|
913
|
-
|
913
|
Total
|
9,514
|
(1,212)
|
8,302
|
(1,538)
|
6,764
|
|
|
|
|
|
|
31 December 2019
|
|
|
|
|
|
US dollar
|
1,519
|
-
|
1,519
|
(1,519)
|
-
|
Euro
|
5,914
|
(650)
|
5,264
|
-
|
5,264
|
Other non-sterling
|
1,498
|
(651)
|
847
|
-
|
847
|
Total
|
8,931
|
(1,301)
|
7,630
|
(1,519)
|
6,111
|
(1)
|
Economic
hedges of US dollar net investments in foreign operations represent
US dollar equity securities that do not qualify as net investment
hedges for accounting purposes. They provide an offset to
structural foreign exchange exposures to the extent that there are
net assets in overseas operations available. Economic hedges of
other currency net investments in foreign operations represent
monetary liabilities that are not booked as net investment
hedges.
|
●
|
The
overall increase in net investments in foreign operations and
residual structural foreign currency exposures mainly reflected the
weakening of sterling against other currencies.
|
●
|
Some
hedging of US dollar investments was arranged during H1 2020, in
advance of expected US dollar distributions from overseas
businesses in Q3 2020. Hedging of other non-sterling businesses
decreased following the receipt of a distribution from Coutts &
Co. Ltd as part of the wind-down of this company’s
operations.
|
●
|
Changes
in foreign currency exchange rates affect equity in proportion to
structural foreign currency exposures pre-economic hedges. For
example, at 30 June 2020, a 5% strengthening in foreign currencies
against sterling would result in a gain of £0.4 billion in
equity while a 5% weakening in foreign currencies against sterling
would result in a loss of £0.4 billion in equity.
|
|
Half year ended
|
|||||||||||||||||
|
30 June 2020
|
|
30 June 2019
|
|
31 December 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period
|
|
|
|
|
Period
|
|
|
|
|
Period
|
||||
|
Average
|
Maximum
|
Minimum
|
end
|
|
Average
|
Maximum
|
Minimum
|
end
|
|
Average
|
Maximum
|
Minimum
|
end
|
||||
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
||||
Interest rate
|
10.1
|
20.2
|
6.1
|
6.1
|
|
10.3
|
16.9
|
6.9
|
9.8
|
|
9.1
|
13.6
|
6.3
|
10.6
|
||||
Credit spread
|
16.3
|
27.2
|
8.7
|
17.7
|
|
9.4
|
12.7
|
7.0
|
9.9
|
|
11.5
|
14.5
|
9.8
|
10.6
|
||||
Currency
|
4.2
|
8.4
|
2.1
|
3.9
|
|
3.6
|
5.8
|
2.0
|
3.8
|
|
4.4
|
10.5
|
1.6
|
3.2
|
||||
Equity
|
0.8
|
2.0
|
0.3
|
0.3
|
|
0.7
|
2.2
|
0.3
|
0.5
|
|
0.7
|
1.6
|
0.3
|
0.9
|
||||
Commodity
|
0.1
|
0.3
|
0.0
|
0.1
|
|
0.2
|
0.5
|
-
|
0.2
|
|
0.1
|
0.2
|
-
|
0.1
|
||||
Diversification (1)
|
(14.8)
|
|
|
(9.6)
|
|
(9.3)
|
|
|
(10.6)
|
|
(11.1)
|
|
|
(11.3)
|
||||
Total
|
16.7
|
25.7
|
10.1
|
18.5
|
|
14.9
|
21.5
|
12.1
|
13.6
|
|
14.7
|
21.5
|
10.1
|
14.1
|
(1)
|
NatWest
Group benefits from diversification across various financial
instrument types, currencies and markets. The extent of the
diversification benefit depends on the correlation between the
assets and risk factors in the portfolio at a particular time. The
diversification factor is the sum of the VaR on individual risk
types less the total portfolio VaR.
|
●
|
Average
traded VaR increased in H1 2020 compared to both H1 and H2 2019.
This reflected Covid-19-related market volatility entering the time
series used in the VaR model.
|
●
|
Despite
this volatility, traded VaR remained within appetite throughout H1
2020.
|
●
|
The
peaks in total, interest rate and credit spread VaR were due to
client bond syndication activity, including the recent 2061 UK Gilt
issuance in which NatWest Markets acted as duration manager on
behalf of the UK Debt Management Office.
|
●
|
During
the second quarter there was significant focus on the potential
operational risks arising from the change in working practices due
to the pandemic, particularly the move to home-working in order to
protect staff and support customers through the crisis. Management
attention also focused heavily on operational resilience to ensure
that planning, controls and operational activities remained robust
and appropriate.
|
●
|
NatWest
Group’s control environment was continually monitored to
ensure that the challenges posed by adapting to the impact of
Covid-19 were safely addressed.
|
●
|
There was also continued oversight of NatWest Group’s
preparations for the end of the transition period, following the
UK’s exit from the EU, to ensure that processes and systems
are appropriate to ensure continuity of service for
customers.
|
●
|
The impact of the pandemic on the NatWest Group’s conduct
risk and regulatory compliance risk profiles remained an important
area of focus. This included oversight of the NatWest Group’s
diverse initiatives to support its customers throughout the crisis.
While the NatWest Group acted to ensure customer needs were met at
pace, the associated conduct and compliance risks were carefully
assessed and monitored throughout.
|
●
|
In addition, there was a sustained emphasis on oversight of the
NatWest Group’s pricing, payment and forbearance treatment
strategies to support customers in recent months, as well as
prioritising the delivery of mandatory and regulatory change
programmes.
|
●
|
The transition from LIBOR to risk-free rates by the end of 2021 and
continued demonstration of compliance with ring-fencing rules will
remain a key focus.
|
●
|
Progress continued to be made on the integration of climate-related
financial risks into NatWest Group’s risk management
framework. This included a focus on scenario-based analysis for
both physical and transition risks in preparation for the deferred
Bank of England biennial exploratory scenario in
2021.
|
|
Half year ended
|
|
|
30 June
|
30 June
|
|
2020
|
2019
|
|
£m
|
£m
|
Interest receivable
|
5,190
|
5,553
|
Interest payable
|
(1,338)
|
(1,549)
|
|
|
|
Net interest income (1)
|
3,852
|
4,004
|
|
|
|
Fees and commissions receivable
|
1,430
|
1,762
|
Fees and commissions payable
|
(392)
|
(487)
|
Income from trading activities
|
802
|
599
|
Other operating income
|
146
|
1,239
|
|
|
|
Non-interest income
|
1,986
|
3,113
|
|
|
|
Total income
|
5,838
|
7,117
|
|
|
|
Staff costs
|
(1,955)
|
(2,028)
|
Premises and equipment
|
(651)
|
(558)
|
Other administrative expenses
|
(696)
|
(863)
|
Depreciation and amortisation
|
(441)
|
(621)
|
Impairment of other intangible assets
|
(7)
|
(30)
|
|
|
|
Operating expenses
|
(3,750)
|
(4,100)
|
|
|
|
Profit before impairment losses
|
2,088
|
3,017
|
Impairment losses
|
(2,858)
|
(323)
|
|
|
|
Operating (loss)/profit before tax
|
(770)
|
2,694
|
Tax credit/(charge)
|
208
|
(194)
|
|
|
|
(Loss)/profit for the period
|
(562)
|
2,500
|
|
|
|
Attributable to:
|
|
|
Ordinary shareholders
|
(705)
|
2,038
|
Preference shareholders
|
16
|
20
|
Paid-in equity holders
|
192
|
182
|
Non-controlling interests
|
(65)
|
260
|
|
(562)
|
2,500
|
|
|
|
Earnings per ordinary share
|
(5.8p)
|
16.9p
|
Earnings per ordinary share - fully diluted
|
(5.8p)
|
16.8p
|
(1)
|
Negative interest on loans is reported as interest payable.
Negative interest on customer deposits is reported as interest
receivable.
|
|
Half year ended
|
|
|
30 June
|
30 June
|
|
2020
|
2019
|
|
£m
|
£m
|
(Loss)/profit for the period
|
(562)
|
2,500
|
|
|
|
Items that do not qualify for reclassification
|
|
|
Remeasurement of retirement benefit schemes
|
68
|
(68)
|
Profit/(loss) on fair value of credit in financial
liabilities
|
|
|
designated at FVTPL due
to own credit risk
|
83
|
(96)
|
FVOCI financial assets
|
(120)
|
38
|
Tax
|
-
|
26
|
|
31
|
(100)
|
Items that do qualify for reclassification
|
|
|
FVOCI financial assets
|
(111)
|
(12)
|
Cash flow hedges
|
417
|
402
|
Currency translation
|
575
|
(241)
|
Tax
|
(179)
|
(122)
|
|
702
|
27
|
|
|
|
Other comprehensive income/(loss) after tax
|
733
|
(73)
|
|
|
|
Total comprehensive income for the period
|
171
|
2,427
|
|
|
|
Attributable to:
|
|
|
Ordinary shareholders
|
14
|
1,950
|
Preference shareholders
|
16
|
20
|
Paid-in equity holders
|
192
|
182
|
Non-controlling interests
|
(51)
|
275
|
|
171
|
2,427
|
|
30 June
|
31 December
|
|
2020
|
2019
|
|
£m
|
£m
|
Assets
|
|
|
Cash and balances at central banks
|
100,281
|
77,858
|
Trading assets
|
72,402
|
76,745
|
Derivatives
|
183,419
|
150,029
|
Settlement balances
|
7,806
|
4,387
|
Loans to banks - amortised cost
|
12,972
|
10,689
|
Loans to customers - amortised cost
|
352,341
|
326,947
|
Other financial assets
|
62,727
|
61,452
|
Intangible assets
|
6,602
|
6,622
|
Other assets
|
8,337
|
8,310
|
|
|
|
Total assets
|
806,887
|
723,039
|
|
|
|
Liabilities
|
|
|
Bank deposits
|
21,119
|
20,493
|
Customer deposits
|
408,268
|
369,247
|
Settlement balances
|
6,895
|
4,069
|
Trading liabilities
|
75,540
|
73,949
|
Derivatives
|
179,859
|
146,879
|
Other financial liabilities
|
49,681
|
45,220
|
Subordinated liabilities
|
13,558
|
9,979
|
Other liabilities
|
8,906
|
9,647
|
Total liabilities
|
763,826
|
679,483
|
|
|
|
Equity
|
|
|
Ordinary shareholders' interests
|
38,608
|
38,993
|
Other owners' interests
|
4,495
|
4,554
|
Owners’ equity
|
43,103
|
43,547
|
Non-controlling interests
|
(42)
|
9
|
|
|
|
Total equity
|
43,061
|
43,556
|
Total liabilities and equity
|
806,887
|
723,039
|
|
|
|
|
Half year ended
|
|
|
30 June
|
30 June
|
|
2020
|
2019
|
|
£m
|
£m
|
Called-up share capital - at beginning of period
|
12,094
|
12,049
|
Ordinary shares issued
|
31
|
42
|
At end of period
|
12,125
|
12,091
|
|
|
|
Paid-in equity - at beginning of period
|
4,058
|
4,058
|
Redeemed/reclassified (1)
|
(1,277)
|
-
|
Securities issued during the period (2)
|
1,220
|
-
|
At end of period
|
4,001
|
4,058
|
|
|
|
Share premium account - at beginning of period
|
1,094
|
1,027
|
Ordinary shares issued
|
16
|
62
|
At end of period
|
1,110
|
1,089
|
|
|
|
Merger reserve - at beginning and end of period
|
10,881
|
10,881
|
|
|
|
FVOCI reserve
- at beginning of
period
|
138
|
343
|
Unrealised (losses)/gains
|
(123)
|
45
|
Realised gains
|
(107)
|
(133)
|
Tax
|
12
|
10
|
At end of period
|
(80)
|
265
|
|
|
|
Cash flow hedging reserve - at beginning of period
|
35
|
(191)
|
Amount recognised in equity
|
445
|
524
|
Amount transferred from equity to earnings
|
(28)
|
(122)
|
Tax
|
(111)
|
(94)
|
At end of period
|
341
|
117
|
|
|
|
Foreign exchange reserve - at beginning of period
|
1,343
|
3,278
|
Retranslation of net assets
|
527
|
30
|
Foreign currency losses on hedges of net assets
|
(63)
|
1
|
Tax
|
(95)
|
8
|
Recycled to profit or loss on disposal of
businesses (3)
|
97
|
(335)
|
At end of period
|
1,809
|
2,982
|
|
|
|
Retained earnings - at beginning of period
|
13,946
|
14,312
|
Implementation of IFRS 16 on 1 January 2019
|
-
|
(187)
|
(Loss)/profit attributable to ordinary shareholders and other
equity owners
|
(497)
|
2,240
|
Equity preference dividends paid
|
(16)
|
(20)
|
Paid-in equity dividends paid
|
(192)
|
(182)
|
Ordinary dividends paid
|
-
|
(1,327)
|
Redemption/reclassification of paid-in equity (1)
|
(355)
|
-
|
Realised (losses)/gains in period on FVOCI equity
shares
|
(1)
|
114
|
Remeasurement of the retirement benefit schemes (4)
|
|
|
- gross
|
68
|
(68)
|
- tax
|
23
|
18
|
Changes in fair value of credit in financial liabilities designated
at fair value through profit or loss
|
|
|
-
gross
|
83
|
(96)
|
-
tax
|
(8)
|
10
|
Shares issued under employee share schemes
|
(11)
|
(4)
|
Share-based payments
|
(100)
|
(26)
|
At end of period
|
12,940
|
14,784
|
|
Half year ended
|
|
|
30 June
|
30 June
|
|
2020
|
2019
|
|
£m
|
£m
|
Own shares held - at beginning of period
|
(42)
|
(21)
|
Shares issued under employee share schemes
|
95
|
(58)
|
Own shares acquired
|
(77)
|
33
|
At end of period
|
(24)
|
(46)
|
Owners' equity at end of period
|
43,103
|
46,221
|
|
|
|
Non-controlling interests - at beginning of period
|
9
|
754
|
Currency translation adjustments and other movements
|
14
|
15
|
(Loss)/profit attributable to non-controlling
interests
|
(65)
|
260
|
Equity raised (5)
|
-
|
45
|
Equity withdrawn and disposals (6)
|
-
|
(1,058)
|
At end of period
|
(42)
|
16
|
|
|
|
Total equity at end of period
|
43,061
|
46,237
|
|
|
|
Attributable to:
|
|
|
Ordinary shareholders
|
38,608
|
41,667
|
Preference shareholders
|
494
|
496
|
Paid-in equity holders
|
4,001
|
4,058
|
Non-controlling interests
|
(42)
|
16
|
|
43,061
|
46,237
|
|
|
|
|
Half year ended
|
|
|
30 June
|
30 June
|
|
2020
|
2019 (1)
|
|
£m
|
£m
|
Operating activities
|
|
|
Operating (loss)/profit before tax
|
(770)
|
2,694
|
Adjustments for non-cash items
|
1,271
|
397
|
|
|
|
Net cash outflow from trading activities
|
501
|
3,091
|
Changes in operating assets and liabilities
|
14,281
|
4,083
|
|
|
|
Net cash flows from operating activities before tax
|
14,782
|
7,174
|
Income taxes paid
|
(231)
|
(192)
|
|
|
|
Net cash flows from operating activities
|
14,551
|
6,982
|
Net cash flows from investing activities
|
2,035
|
(4,770)
|
Net cash flows from financing activities
|
2,748
|
(705)
|
Effects of exchange rate changes on cash and cash
equivalents
|
2,752
|
211
|
|
|
|
Net increase in cash and cash equivalents
|
22,086
|
1,718
|
Cash and cash equivalents at beginning of period
|
100,588
|
108,936
|
|
|
|
Cash and cash equivalents at end of period
|
122,674
|
110,654
|
|
Half year ended
|
|
|
30 June
|
30 June
|
|
2020
|
2019
|
|
£m
|
£m
|
Loans to customers - amortised cost
|
4,698
|
4,848
|
Loans to banks - amortised cost
|
189
|
346
|
Other financial assets
|
303
|
359
|
Interest receivable (1)
|
5,190
|
5,553
|
|
|
|
Deposits by banks
|
89
|
144
|
Customer deposits
|
432
|
599
|
Other financial liabilities
|
481
|
481
|
Subordinated liabilities
|
218
|
245
|
Internal funding of trading businesses
|
118
|
80
|
Interest payable (1)
|
1,338
|
1,549
|
Net interest income
|
3,852
|
4,004
|
|
|
|
Net fees and commissions
|
1,038
|
1,275
|
|
|
|
Foreign exchange
|
344
|
219
|
Interest rate
|
472
|
397
|
Credit
|
(68)
|
31
|
Own credit adjustment
|
53
|
(46)
|
Equity, commodities and other
|
1
|
(2)
|
Income from trading activities
|
802
|
599
|
|
|
|
Operating lease and other rental income
|
119
|
127
|
Changes in fair value of financial assets or liabilities designated
at fair value through profit or loss (2)
|
(21)
|
19
|
Changes in fair value of other financial assets fair value through
profit or loss
|
(10)
|
31
|
Hedge ineffectiveness
|
(10)
|
21
|
Loss on disposal of amortised assets
|
(16)
|
-
|
Profit on disposal of fair value through other comprehensive income
assets
|
108
|
16
|
Profit on sale of property, plant and equipment
|
11
|
15
|
Share of profit/(loss) of associated entities
|
12
|
(22)
|
(Loss)/profit on disposal of subsidiaries and
associates (3)
|
(99)
|
1,037
|
Other income
|
52
|
(5)
|
|
|
|
Other operating income
|
146
|
1,239
|
|
|
|
Total non-interest income
|
1,986
|
3,113
|
|
|
|
Total income
|
5,838
|
7,117
|
|
|
|
Salaries
|
(1,290)
|
(1,260)
|
Variable compensation
|
(179)
|
(185)
|
Temporary and contract costs
|
(148)
|
(207)
|
Social security costs
|
(153)
|
(156)
|
Pension costs
|
(164)
|
(162)
|
Other
|
(21)
|
(58)
|
Staff costs
|
(1,955)
|
(2,028)
|
Premises and equipment
|
(651)
|
(558)
|
Depreciation and amortisation (4)
|
(441)
|
(621)
|
Other administrative expenses (5)
|
(696)
|
(863)
|
Impairment of other intangible assets
|
(7)
|
(30)
|
|
|
|
Operating expenses
|
(3,750)
|
(4,100)
|
|
|
|
Impairment losses
|
(2,858)
|
(323)
|
Impairments as a % of gross loans to customers
|
1.59%
|
0.21%
|
|
(1) Negative interest
on loans is reported as interest payable. Negative interest on
customer deposits is reported as interest receivable.
(2) Including related
derivatives.
(3) Half year ended 30
June 2019 includes a gain of £444 million, a legacy liability
release of £256 million and an FX recycling gain of £290
million on completion of the Alawwal bank merger.
(4) Half year ended 30
June 2019 includes a property impairment of £133 million and
accelerated depreciation of £66 million in relation to the
planned reduction of the property portfolio.
(5) Includes litigation
and conduct costs, net of amounts recovered.
|
●
|
UK Personal
Banking, Ulster Bank RoI, Commercial Banking, Private Banking, RBS
International, NatWest Markets and Central items &
other.
|
|
Net
|
Net fees
|
Other
|
|
|
Impairment
|
|
|
interest
|
and
|
non-interest
|
Total
|
Operating
|
(losses)/
|
Operating
|
|
income
|
commissions
|
income
|
income
|
expenses
|
releases
|
profit/(loss)
|
Half year ended 30 June 2020
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
UK Personal Banking
|
1,982
|
204
|
(1)
|
2,185
|
(1,075)
|
(657)
|
453
|
Ulster Bank RoI
|
194
|
44
|
11
|
249
|
(245)
|
(243)
|
(239)
|
Commercial Banking
|
1,370
|
552
|
81
|
2,003
|
(1,221)
|
(1,790)
|
(1,008)
|
Private Banking
|
251
|
130
|
11
|
392
|
(252)
|
(56)
|
84
|
RBS International
|
201
|
43
|
15
|
259
|
(126)
|
(46)
|
87
|
NatWest Markets
|
(34)
|
76
|
774
|
816
|
(707)
|
(40)
|
69
|
Central items & other
|
(112)
|
(11)
|
57
|
(66)
|
(124)
|
(26)
|
(216)
|
Total
|
3,852
|
1,038
|
948
|
5,838
|
(3,750)
|
(2,858)
|
(770)
|
|
|
|
|
|
|
|
|
Half year ended 30 June 2019
|
|
|
|
|
|
|
|
UK Personal Banking
|
2,084
|
366
|
(3)
|
2,447
|
(1,229)
|
(181)
|
1,037
|
Ulster Bank RoI
|
200
|
51
|
32
|
283
|
(281)
|
21
|
23
|
Commercial Banking
|
1,424
|
661
|
80
|
2,165
|
(1,262)
|
(202)
|
701
|
Private Banking
|
261
|
111
|
12
|
384
|
(232)
|
3
|
155
|
RBS International
|
242
|
53
|
15
|
310
|
(119)
|
3
|
194
|
NatWest Markets
|
(122)
|
48
|
1,016
|
942
|
(678)
|
36
|
300
|
Central items & other
|
(85)
|
(15)
|
686
|
586
|
(299)
|
(3)
|
284
|
Total
|
4,004
|
1,275
|
1,838
|
7,117
|
(4,100)
|
(323)
|
2,694
|
|
Half year ended
|
|||||
|
30 June 2020
|
30 June 2019
|
||||
|
|
Inter
|
|
|
Inter
|
|
|
External
|
segment
|
Total
|
External
|
segment
|
Total
|
Total revenue
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
UK Personal Banking
|
2,764
|
24
|
2,788
|
3,118
|
32
|
3,150
|
Ulster Bank RoI
|
277
|
-
|
277
|
309
|
2
|
311
|
Commercial Banking
|
2,009
|
47
|
2,056
|
2,173
|
63
|
2,236
|
Private Banking
|
358
|
99
|
457
|
343
|
120
|
463
|
RBS International
|
269
|
3
|
272
|
319
|
15
|
334
|
NatWest Markets
|
1,328
|
4
|
1,332
|
1,494
|
510
|
2,004
|
Central items & other (1)
|
563
|
(177)
|
386
|
1,397
|
(742)
|
655
|
Total
|
7,568
|
-
|
7,568
|
9,153
|
-
|
9,153
|
|
UK
|
|
|
|
|
|
Central
|
|
|
Personal
|
Ulster
|
Commercial
|
Private
|
RBS
|
NatWest
|
items
|
|
|
Banking
|
Bank RoI
|
Banking
|
Banking
|
International
|
Markets
|
& other
|
Total
|
Half year ended 30 June 2020
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Fees and commissions receivable
|
|
|
|
|
|
|
|
|
- Payment
services
|
129
|
28
|
256
|
14
|
9
|
9
|
-
|
445
|
- Lending (credit
facilities)
|
37
|
6
|
199
|
2
|
14
|
44
|
-
|
302
|
- Credit and debit card
fees
|
144
|
10
|
60
|
4
|
1
|
-
|
-
|
219
|
- Investment management,
trustee
|
|
|
|
|
|
|
|
|
and fiduciary services
|
1
|
1
|
-
|
113
|
17
|
-
|
-
|
132
|
- Underwriting
fees
|
-
|
-
|
-
|
-
|
-
|
124
|
-
|
124
|
-
Other
|
34
|
3
|
90
|
18
|
3
|
100
|
(40)
|
208
|
Total
|
345
|
48
|
605
|
151
|
44
|
277
|
(40)
|
1,430
|
|
|
|
|
|
|
|
|
|
Fees and commissions payable
|
(141)
|
(4)
|
(53)
|
(21)
|
(1)
|
(201)
|
29
|
(392)
|
Net fees and commissions
|
204
|
44
|
552
|
130
|
43
|
76
|
(11)
|
1,038
|
|
|
|
|
|
|
|
|
|
Half year ended 30 June 2019
|
|
|
|
|
|
|
|
|
Fees and commissions receivable
|
|
|
|
|
|
|
|
|
- Payment
services
|
154
|
21
|
323
|
17
|
12
|
15
|
-
|
542
|
- Lending (credit
facilities)
|
266
|
18
|
204
|
1
|
18
|
35
|
-
|
542
|
- Credit and debit card
fees
|
189
|
10
|
84
|
6
|
1
|
-
|
-
|
290
|
- Investment management,
trustee
|
|
|
|
|
|
|
|
|
and fiduciary services
|
22
|
2
|
3
|
91
|
20
|
-
|
-
|
138
|
- Underwriting
fees
|
-
|
-
|
-
|
-
|
-
|
100
|
-
|
100
|
-
Other
|
36
|
6
|
82
|
12
|
3
|
88
|
(77)
|
150
|
Total
|
667
|
57
|
696
|
127
|
54
|
238
|
(77)
|
1,762
|
|
|
|
|
|
|
|
|
|
Fees and commissions payable
|
(301)
|
(6)
|
(35)
|
(16)
|
(1)
|
(190)
|
62
|
(487)
|
Net fees and commissions
|
366
|
51
|
661
|
111
|
53
|
48
|
(15)
|
1,275
|
|
30 June 2020
|
31 December 2019
|
||
|
Assets
|
Liabilities
|
Assets
|
Liabilities
|
|
£m
|
£m
|
£m
|
£m
|
UK Personal Banking
|
187,056
|
164,121
|
182,305
|
153,999
|
Ulster Bank RoI
|
27,631
|
23,607
|
25,385
|
21,012
|
Commercial Banking
|
186,013
|
166,074
|
165,399
|
140,863
|
Private Banking
|
23,940
|
29,955
|
23,304
|
28,610
|
RBS International
|
31,537
|
29,642
|
31,738
|
30,330
|
NatWest Markets
|
303,826
|
286,229
|
263,885
|
246,907
|
Central items & other
|
46,884
|
64,198
|
31,023
|
57,762
|
Total
|
806,887
|
763,826
|
723,039
|
679,483
|
|
Half year ended
|
|
|
30 June
|
30 June
|
|
2020
|
2019
|
|
£m
|
£m
|
(Loss)/profit before tax
|
(770)
|
2,694
|
|
|
|
Expected tax credit/(charge)
|
146
|
(512)
|
Losses and temporary differences in period where no deferred tax
assets recognised
|
(38)
|
(2)
|
Foreign profits taxed at other rates
|
(24)
|
5
|
UK tax rate change impact
|
75
|
-
|
Items not allowed for tax:
|
|
|
- losses on disposals
and write-downs
|
(14)
|
(46)
|
- UK bank
levy
|
(15)
|
(15)
|
- regulatory and legal
actions
|
20
|
(5)
|
- other disallowable
items
|
(23)
|
(40)
|
Non-taxable items:
|
|
|
- Alawwal bank merger
gain on disposal
|
-
|
212
|
- other non-taxable
items
|
68
|
26
|
Taxable foreign exchange movements
|
(2)
|
-
|
Losses bought forward and utilised
|
23
|
21
|
(Reduction)/increase in carrying value of deferred tax in respect
of:
|
|
|
- UK
losses
|
(56)
|
215
|
- Ireland
losses
|
(20)
|
-
|
Banking surcharge
|
52
|
(155)
|
Tax on paid-in equity
|
38
|
-
|
Adjustments in respect of prior periods
|
(22)
|
102
|
|
|
|
Actual tax credit/(charge)
|
208
|
(194)
|
|
Half year ended
|
|
|
30 June
|
30 June
|
|
2020
|
2019
|
|
£m
|
£m
|
RBS Sempra Commodities LLP
|
(52)
|
-
|
RFS Holdings B.V. Consortium Members (1)
|
-
|
258
|
Other
|
(13)
|
2
|
|
|
|
(Loss)/profit attributable to non-controlling
interests
|
(65)
|
260
|
|
|
|
|
|
|
30 June
|
31 December
|
|
2020
|
2019
|
Assets
|
£m
|
£m
|
Loans
|
|
|
Reverse
repos
|
18,909
|
24,095
|
Collateral
given
|
25,062
|
20,579
|
Other
loans
|
3,097
|
1,947
|
Total loans
|
47,068
|
46,621
|
Securities
|
|
|
Central and local
government
|
|
|
- UK
|
4,515
|
4,897
|
- US
|
4,570
|
5,458
|
-
other
|
12,081
|
14,902
|
Financial institutions
and corporate
|
4,168
|
4,867
|
Total securities
|
25,334
|
30,124
|
Total
|
72,402
|
76,745
|
|
|
|
Liabilities
|
|
|
Deposits
|
|
|
Repos
|
23,767
|
27,885
|
Collateral
received
|
27,139
|
21,509
|
Other
deposits
|
2,092
|
1,606
|
Total deposits
|
52,998
|
51,000
|
Debt securities in issue
|
2,084
|
1,762
|
Short positions
|
20,458
|
21,187
|
Total
|
75,540
|
73,949
|
|
|
|
Amortised
|
Other
|
|
|
MFVTPL (1)
|
FVOCI (2)
|
cost
|
assets
|
Total
|
Assets
|
£m
|
£m
|
£m
|
£m
|
£m
|
Cash and balances at central banks
|
|
|
100,281
|
|
100,281
|
Trading assets
|
72,402
|
|
|
|
72,402
|
Derivatives (3)
|
183,419
|
|
|
|
183,419
|
Settlement balances
|
|
|
7,806
|
|
7,806
|
Loans to banks - amortised cost (4)
|
|
|
12,972
|
|
12,972
|
Loans to customers - amortised cost (5)
|
|
|
352,341
|
|
352,341
|
Other financial assets
|
656
|
50,445
|
11,626
|
|
62,727
|
Intangible assets
|
|
|
|
6,602
|
6,602
|
Other assets
|
|
|
|
8,337
|
8,337
|
30 June 2020
|
256,477
|
50,445
|
485,026
|
14,939
|
806,887
|
|
|
|
|
|
|
Cash and balances at central banks
|
|
|
77,858
|
|
77,858
|
Trading assets
|
76,745
|
|
|
|
76,745
|
Derivatives (3)
|
150,029
|
|
|
|
150,029
|
Settlement balances
|
|
|
4,387
|
|
4,387
|
Loans to banks - amortised cost (4)
|
|
|
10,689
|
|
10,689
|
Loans to customers - amortised cost (5)
|
|
|
326,947
|
|
326,947
|
Other financial assets
|
715
|
49,283
|
11,454
|
|
61,452
|
Intangible assets
|
|
|
|
6,622
|
6,622
|
Other assets
|
|
|
|
8,310
|
8,310
|
31 December 2019
|
227,489
|
49,283
|
431,335
|
14,932
|
723,039
|
|
Held-for-
|
|
Amortised
|
Other
|
|
|
trading
|
DFV (6)
|
cost
|
liabilities
|
Total
|
Liabilities
|
£m
|
£m
|
£m
|
£m
|
£m
|
Bank deposits (7)
|
|
|
21,119
|
|
21,119
|
Customer deposits
|
|
|
408,268
|
|
408,268
|
Settlement balances
|
|
|
6,895
|
|
6,895
|
Trading liabilities
|
75,540
|
|
|
|
75,540
|
Derivatives (8)
|
179,859
|
|
|
|
179,859
|
Other financial liabilities
|
|
2,119
|
47,562
|
|
49,681
|
Subordinated liabilities
|
|
734
|
12,824
|
|
13,558
|
Other liabilities (9)
|
|
|
4,146
|
4,760
|
8,906
|
30 June 2020
|
255,399
|
2,853
|
500,814
|
4,760
|
763,826
|
|
|
|
|
|
|
Bank deposits (7)
|
|
|
20,493
|
|
20,493
|
Customer deposits
|
|
|
369,247
|
|
369,247
|
Settlement balances
|
|
|
4,069
|
|
4,069
|
Trading liabilities
|
73,949
|
|
|
|
73,949
|
Derivatives (8)
|
146,879
|
|
|
|
146,879
|
Other financial liabilities
|
|
2,258
|
42,962
|
|
45,220
|
Subordinated liabilities
|
|
724
|
9,255
|
|
9,979
|
Other liabilities (9)
|
|
|
4,029
|
5,618
|
9,647
|
31 December 2019
|
220,828
|
2,982
|
450,055
|
5,618
|
679,483
|
(1)
|
Mandatory
fair value through profit or loss.
|
(2)
|
Fair
value through other comprehensive income.
|
(3)
|
Includes
net hedging derivatives of £298 million (31 December 2019 -
£202 million).
|
(4)
|
Includes
items in the course of collection from other banks of £57
million (31 December 2019 - £50 million).
|
(5)
|
Includes
finance lease receivables.
|
(6)
|
Designated
as at fair value through profit or loss.
|
(7)
|
Includes
items in the course of transmission to other banks of nil (31
December 2019 - £2 million).
|
(8)
|
Includes
net hedging derivatives of £44 million (31 December 2019 -
£22 million).
|
(9)
|
Includes
lease liabilities of £1,781 million (31 December 2019 -
£1,823 million).
|
|
30 June
|
31 December
|
|
2020
|
2019
|
|
£m
|
£m
|
Reverse repos
|
|
|
Trading assets
|
18,909
|
24,095
|
Loans to banks - amortised cost
|
512
|
165
|
Loans to customers - amortised cost
|
17,569
|
10,649
|
|
|
|
Repos
|
|
|
Bank deposits
|
627
|
2,597
|
Customer deposits
|
1,337
|
1,765
|
Trading liabilities
|
23,767
|
27,885
|
|
30 June 2020
|
31 December 2019
|
||||
|
Level 1
|
Level 2
|
Level 3
|
Level 1
|
Level 2
|
Level 3
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Assets
|
|
|
|
|
|
|
Trading assets
|
|
|
|
|
|
|
Loans
|
-
|
46,646
|
422
|
-
|
46,172
|
449
|
Securities
|
17,983
|
7,185
|
166
|
20,865
|
8,704
|
555
|
Derivatives
|
-
|
182,104
|
1,315
|
-
|
148,800
|
1,229
|
Other financial assets
|
|
|
|
|
|
|
Loans
|
-
|
269
|
278
|
-
|
307
|
58
|
Securities
|
41,030
|
9,196
|
328
|
41,044
|
8,326
|
263
|
Total financial assets held at fair value
|
59,013
|
245,400
|
2,509
|
61,909
|
212,309
|
2,554
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
Trading liabilities
|
|
|
|
|
|
|
Deposits
|
-
|
52,969
|
29
|
-
|
50,944
|
56
|
Debt securities in
issue
|
-
|
2,069
|
15
|
-
|
1,703
|
59
|
Short
positions
|
15,365
|
5,093
|
-
|
15,565
|
5,622
|
-
|
Derivatives
|
-
|
178,895
|
964
|
-
|
145,818
|
1,061
|
Other financial liabilities
|
|
|
|
|
|
|
Debt securities in
issue
|
-
|
1,769
|
-
|
-
|
2,117
|
141
|
Other
deposits
|
-
|
350
|
-
|
-
|
-
|
-
|
Subordinated liabilities
|
-
|
734
|
-
|
-
|
724
|
-
|
Total financial liabilities held at fair value
|
15,365
|
241,879
|
1,008
|
15,565
|
206,928
|
1,317
|
(1)
|
Level 1
- Instruments valued using unadjusted quoted prices in active and
liquid markets, for identical financial instruments. Examples
include government bonds, listed equity shares and certain
exchange-traded derivatives.
Level 2
- Instruments valued using valuation techniques that have
observable inputs. Examples include most government agency
securities, investment-grade corporate bonds, certain mortgage
products, including CLOs, most bank loans, repos and reverse repos,
less liquid listed equities, state and municipal obligations, most
notes issued, and certain money market securities and loan
commitments and most OTC derivatives.
Level 3
- Instruments valued using a valuation technique where at least one
input which could have a significant effect on the
instrument’s valuation, is not based on observable market
data. Examples include cash instruments which trade infrequently,
certain syndicated and commercial mortgage loans, certain emerging
markets and derivatives with unobservable model
inputs.
|
(2)
|
Transfers
between levels are deemed to have occurred at the beginning of the
quarter in which the instrument was transferred. There were no
significant
transfers
between level 1 and level 2.
|
(3)
|
For an
analysis of debt securities held at mandatorily fair value through
profit or loss by issuer as well as ratings and derivatives, by
type and contract, refer to Capital and Risk management –
Credit risk.
|
(4)
|
The
determination of an instrument’s level cannot be made at a
global product level as a single product type can be in more than
one level. For example, a
single
name corporate credit default swap could be in level 2 or level 3
depending on whether the reference counterparty’s obligations
are liquid or illiquid.
|
|
30 June 2020
|
31 December 2019
|
||||
|
Level 3
|
Favourable
|
Unfavourable
|
Level 3
|
Favourable
|
Unfavourable
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Assets
|
|
|
|
|
|
|
Trading assets
|
|
|
|
|
|
|
Loans
|
422
|
10
|
(10)
|
449
|
10
|
(10)
|
Securities
|
166
|
10
|
-
|
555
|
-
|
-
|
Derivatives
|
|
|
|
|
|
|
Interest
rate
|
1,115
|
120
|
(120)
|
1,015
|
160
|
(160)
|
Foreign
exchange
|
82
|
10
|
(10)
|
98
|
10
|
(10)
|
Other
|
118
|
10
|
(10)
|
116
|
10
|
(10)
|
Other financial assets
|
|
|
|
|
|
|
Loans
|
278
|
10
|
(10)
|
58
|
-
|
-
|
Securities
|
328
|
70
|
(10)
|
263
|
80
|
(20)
|
Total financial assets held at fair value
|
2,509
|
240
|
(170)
|
2,554
|
270
|
(210)
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
Trading liabilities
|
|
|
|
|
|
|
Deposits
|
29
|
-
|
-
|
56
|
-
|
-
|
Debt securities in
issue
|
15
|
-
|
(20)
|
59
|
-
|
-
|
Derivatives
|
|
|
|
|
|
|
Interest
rate
|
529
|
70
|
(60)
|
630
|
70
|
(70)
|
Foreign
exchange
|
240
|
-
|
-
|
222
|
10
|
(10)
|
Other
|
195
|
10
|
(10)
|
209
|
20
|
(10)
|
Other financial liabilities
|
|
|
|
|
|
|
Debt securities in
issue
|
-
|
-
|
-
|
141
|
10
|
(10)
|
Total financial liabilities held at fair value
|
1,008
|
80
|
(90)
|
1,317
|
110
|
(100)
|
|
Half year ended 30 June 2020
|
Half year ended 30 June 2019
|
||||||
|
|
Other
|
|
|
|
Other
|
|
|
|
Trading
|
financial
|
Total
|
Total
|
Trading
|
financial
|
Total
|
Total
|
|
assets (1)
|
assets (2)
|
assets
|
liabilities
|
assets (1)
|
assets (2)
|
assets
|
liabilities
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
At 1 January
|
2,233
|
321
|
2,554
|
1,317
|
2,657
|
643
|
3,300
|
1,957
|
Amount recorded in the income statement (3)
|
313
|
(1)
|
312
|
97
|
(113)
|
4
|
(109)
|
260
|
Amount recorded in the statement of
|
|
|
|
|
|
|
|
|
comprehensive
income
|
-
|
62
|
62
|
-
|
-
|
75
|
75
|
-
|
Level 3 transfers in
|
133
|
207
|
340
|
6
|
158
|
2
|
160
|
161
|
Level 3 transfers out
|
(101)
|
-
|
(101)
|
(337)
|
(462)
|
(53)
|
(515)
|
(239)
|
Issuances
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
23
|
Purchases
|
366
|
10
|
376
|
100
|
290
|
2
|
292
|
216
|
Settlements
|
(113)
|
-
|
(113)
|
(14)
|
(73)
|
(6)
|
(79)
|
(171)
|
Sales
|
(933)
|
(1)
|
(934)
|
(164)
|
(249)
|
(157)
|
(406)
|
(419)
|
Foreign exchange and other adjustments
|
5
|
8
|
13
|
3
|
3
|
(3)
|
-
|
2
|
At 30 June
|
1,903
|
606
|
2,509
|
1,008
|
2,211
|
507
|
2,718
|
1,790
|
Amounts recorded in the income statement
|
|
|
|
|
|
|
|
|
in respect of balances
held at year end
|
|
|
|
|
|
|
|
|
-
unrealised
|
313
|
(1)
|
312
|
97
|
(112)
|
2
|
(110)
|
260
|
(1)
|
Trading
assets comprise assets held at fair value in trading
portfolios.
|
(2)
|
Other
financial assets comprise fair value through other comprehensive
income, designated at fair value through profit or loss and other
fair value through profit or loss.
|
(3)
|
£215
million net gains on trading assets and liabilities (30 June 2019 -
£383 million losses) were recorded in income from trading
activities. Net gains on other instruments of nil (30 June 2019 -
£14 million gains) were recorded in other operating income and
interest income as appropriate.
|
|
30 June
|
|
31 December
|
|
2020
|
|
2019
|
|
£m
|
|
£m
|
Funding - FVA
|
188
|
|
244
|
Credit - CVA
|
445
|
|
386
|
Bid - Offer
|
148
|
|
165
|
Product and deal specific
|
170
|
|
238
|
|
951
|
|
1,033
|
●
|
Valuation
reserves, comprised of credit valuation adjustments (CVA), funding
valuation adjustment (FVA), bid-offer and product and deal specific
reserves decreased to £951 million at 30 June 2020 (31
December 2019 – £1,033 million) with an increase in CVA
reserves more than offset by reductions in other
reserves.
|
●
|
CVA
reserves increased to £445 million at 30 June 2020 (31
December 2019 – £386 million) due to credit spreads
widening and increases in positive exposures, driven by interest
rate and FX market moves, partially offset by trade novation
activity.
|
●
|
FVA
reserves reduced to £188 million at 30 June 2020 (31 December
2019 – £244 million) as the impact of funding spreads
widening and the increases in positive exposures were more than
offset by increases in negative exposures, credit spreads widening,
trade novation activity and a reduction in the types of initial
margin posting requirements assessed as part of FVA. The reduction
in product and deal specific reserves to £170 million at 30
June 2020 (31 December 2019 - £238 million) was due to certain
negative exposures increasing (driven by interest rate and FX
market moves), credit spreads widening and trade novation
activity.
|
|
|
Items where
|
|
|
|
|
|
|
fair value
|
|
|
|
|
|
|
|
approximates
|
Carrying
|
|
Fair value hierarchy level
|
||
|
carrying value
|
value
|
Fair value
|
Level 1
|
Level 2
|
Level 3
|
30 June 2020
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
Financial assets
|
|
|
|
|
|
|
Cash and balances at central banks
|
100.3
|
|
|
|
|
|
Settlement balances
|
7.8
|
|
|
|
|
|
Loans to banks
|
0.1
|
12.9
|
12.9
|
-
|
7.6
|
5.3
|
Loans to customers
|
|
352.3
|
351.0
|
-
|
17.9
|
333.1
|
Other financial assets
|
|
|
|
|
|
|
Securities
|
|
11.6
|
11.8
|
6.2
|
2.5
|
3.1
|
Financial liabilities
|
|
|
|
|
|
|
Bank deposits
|
4.6
|
16.5
|
16.5
|
-
|
10.2
|
6.3
|
Customer deposits
|
349.3
|
59.0
|
59.0
|
-
|
7.0
|
52.0
|
Settlement balances
|
6.9
|
|
|
|
|
|
Other financial liabilities
|
|
|
|
|
|
|
Debt securities in
issue
|
|
47.6
|
48.0
|
-
|
41.8
|
6.2
|
Subordinated liabilities
|
|
12.8
|
13.4
|
-
|
13.3
|
0.1
|
Other liabilities - notes in circulation
|
2.1
|
|
|
|
|
|
|
|
|
|
|
|
|
31 December 2019
|
|
|
|
|
|
|
Financial assets
|
|
|
|
|
|
|
Cash and balances at central banks
|
77.9
|
|
|
|
|
|
Settlement balances
|
4.4
|
|
|
|
|
|
Loans to banks
|
|
10.7
|
10.7
|
-
|
6.2
|
4.5
|
Loans to customers
|
|
326.9
|
324.0
|
-
|
11.0
|
313.0
|
Other financial assets
|
|
|
|
|
|
|
Securities
|
|
11.5
|
11.6
|
5.9
|
2.8
|
2.9
|
Financial liabilities
|
|
|
|
|
|
|
Bank deposits
|
4.1
|
16.4
|
16.5
|
-
|
12.2
|
4.3
|
Customer deposits
|
312.4
|
56.8
|
56.9
|
-
|
7.5
|
49.4
|
Settlement balances
|
4.1
|
|
|
|
|
|
Other financial liabilities
|
|
|
|
|
|
|
Debt securities in
issue
|
|
43.0
|
43.7
|
-
|
38.5
|
5.2
|
Subordinated liabilities
|
|
9.3
|
10.0
|
-
|
9.9
|
0.1
|
Other liabilities - notes in circulation
|
2.2
|
|
|
|
|
|
|
|
|
|
|
|
Payment
|
Other
|
|
|
|
|
|
protection
|
customer
|
Litigation and
|
|
|
|
insurance (1)
|
redress
|
other regulatory
|
Other (2)
|
Total
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
At 1 January 2020
|
1,156
|
314
|
426
|
781
|
2,677
|
ECL impairment charge
|
-
|
-
|
-
|
46
|
46
|
Currency translation and other movements
|
-
|
3
|
21
|
-
|
24
|
Charge to income statement
|
-
|
13
|
98
|
17
|
128
|
Release to income statement
|
(100)
|
(8)
|
(17)
|
(29)
|
(154)
|
Provisions utilised
|
(197)
|
(47)
|
(35)
|
(100)
|
(379)
|
At 31 March 2020
|
859
|
275
|
493
|
715
|
2,342
|
ECL impairment charge
|
-
|
-
|
-
|
77
|
77
|
Currency translation and other movements
|
-
|
1
|
2
|
-
|
3
|
Charge to income statement
|
1
|
62
|
2
|
134
|
199
|
Release to income statement
|
(150)
|
(7)
|
(4)
|
(54)
|
(215)
|
Provisions utilised
|
(204)
|
(49)
|
(11)
|
(106)
|
(370)
|
At 30 June 2020
|
506
|
282
|
482
|
766
|
2,036
|
|
|
|
|
|
|
(1)
|
The
balance at 30 June 2020 includes provisions held in relation to
offers made in 2019 and earlier years of £134 million
.
|
(2)
|
Materially
comprises provisions relating to property closures and
restructuring costs.
|
|
|
|
|
30 June
|
31 December
|
|
2020
|
2019
|
|
£m
|
£m
|
Loans - amortised cost and FVOCI
|
|
|
Stage 1
|
266,444
|
305,502
|
Stage 2
|
97,010
|
27,868
|
Stage 3
|
7,034
|
6,598
|
Of which: individual
|
2,372
|
2,051
|
Of which: collective
|
4,662
|
4,547
|
|
370,488
|
339,968
|
ECL provisions (1)
|
|
|
Stage 1
|
469
|
322
|
Stage 2
|
3,025
|
752
|
Stage 3
|
2,860
|
2,718
|
Of which: individual
|
905
|
796
|
Of which: collective
|
1,955
|
1,922
|
|
6,354
|
3,792
|
ECL provisions coverage (2, 3)
|
|
|
Stage 1 (%)
|
0.18
|
0.11
|
Stage 2 (%)
|
3.12
|
2.70
|
Stage 3 (%)
|
40.66
|
41.19
|
|
1.72
|
1.12
|
|
|
|
|
Half year ended
|
|
|
30 June
|
30 June
|
|
2020
|
2019
|
|
£m
|
£m
|
Impairment losses
|
|
|
ECL charge (4)
|
2,858
|
323
|
Stage 1
|
308
|
(140)
|
Stage 2
|
2,150
|
101
|
Stage 3
|
400
|
362
|
Of which: individual
|
131
|
170
|
Of which: collective
|
269
|
192
|
ECL loss rate - annualised (basis points) (3)
|
154.28
|
19.88
|
Amounts written off
|
408
|
452
|
Of which: individual
|
41
|
243
|
Of which: collective
|
367
|
209
|
(1)
|
Includes
£8 million (31 December 2019 – £4 million) related
to assets classified as FVOCI.
|
(2)
|
ECL
provisions coverage is calculated as ECL provisions divided by
loans.
|
(3)
|
ECL
provisions coverage and ECL loss rates are calculated on third
party loans and related ECL provisions and charge respectively. ECL
loss rate is calculated as annualised third party ECL charge
divided by loans. The half year ECL charge is annualised by
multiplying by two.
|
(4)
|
Includes
a £5 million charge (30 June 2019 – £30 million
charge) related to other financial assets, of which £4 million
(30 June 2019 – nil) related to assets classified as FVOCI;
and £8 million (30 June 2019 - £28 million) related to
contingent liabilities.
|
(5)
|
The
table above shows gross loans only and excludes amounts that are
outside the scope of the ECL framework. Refer to page 90 for
Financial instruments within the scope of the IFRS 9 ECL framework
for further details. Other financial assets within the scope of the
IFRS 9 ECL framework were cash and balances at central banks
totalling £99.2 billion and debt securities of £60.5
billion (31 December 2019 – £76.1 billion and £59.4
billion respectively).
|
|
30 June 2020
|
31 December 2019
|
||||
|
Goodwill
|
Other (1)
|
Total
|
Goodwill
|
Other (1)
|
Total
|
Cost
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
At 1 January
|
9,980
|
2,293
|
12,273
|
18,164
|
2,024
|
20,188
|
Currency translation and other adjustments
|
2
|
-
|
2
|
(180)
|
2
|
(178)
|
Acquisition of subsidiaries
|
-
|
-
|
-
|
1
|
-
|
1
|
Additions
|
-
|
133
|
133
|
-
|
380
|
380
|
Disposals and write-off of fully amortised
assets (2)
|
-
|
(23)
|
(23)
|
(8,005)
|
(113)
|
(8,118)
|
At 30 June
|
9,982
|
2,403
|
12,385
|
9,980
|
2,293
|
12,273
|
|
|
|
|
|
|
|
Accumulated amortisation and impairment
|
|
|
|
|
|
|
At 1 January
|
4,373
|
1,278
|
5,651
|
12,558
|
1,014
|
13,572
|
Currency translation and other adjustments
|
2
|
1
|
3
|
(180)
|
1
|
(179)
|
Disposals and write-off of fully amortised assets
|
-
|
(19)
|
(19)
|
(8,005)
|
(72)
|
(8,077)
|
Charge for the year
|
-
|
141
|
141
|
-
|
291
|
291
|
Impairment of other intangible assets
|
-
|
7
|
7
|
-
|
44
|
44
|
At 30 June
|
4,375
|
1,408
|
5,783
|
4,373
|
1,278
|
5,651
|
|
|
|
|
|
|
|
Net book value at 30 June
|
5,607
|
995
|
6,602
|
5,607
|
1,015
|
6,622
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forecast
|
|
Assumptions
|
Recoverable
|
||||
|
|
|
|
Long-term
|
Capital
|
|
|
|
amount
|
|
|
ECL loss
|
|
effective
|
requirements
|
|
Terminal
|
Pre-tax
|
exceeded
|
|
Goodwill
|
rate
|
C:I ratio
|
tax rate
|
CET1 ratio
|
|
growth rate
|
discount rate
|
carrying value
|
30 June 2020
|
£bn
|
%
|
%
|
%
|
%
|
|
%
|
%
|
£bn
|
Commercial Banking
|
2.6
|
0.36
|
58.7
|
27.0
|
11.5
|
|
1.6
|
13.7
|
1.6
|
|
|
|
|
|
|
|
|
|
|
31 December 2019
|
|
|
|
|
|
|
|
|
|
Commercial Banking
|
2.6
|
0.29
|
53.8
|
25.0
|
12.0
|
|
1.6
|
13.4
|
4.1
|
|
|
|
|
|
|
|
Change to reduce
|
|
Favourable change
|
|
Unfavourable change
|
|
headroom to nil
|
||
|
|
Increase in VIU
|
|
Decrease in VIU
|
|
|
|
30 June 2020
|
%
|
£bn
|
|
%
|
£bn
|
|
%
|
ECL loss rates
|
(0.16)
|
0.7
|
|
0.10
|
(0.9)
|
|
0.17
|
Cost:income ratio
|
(1.0)
|
2.1
|
|
4.5
|
(1.5)
|
|
4.6
|
Forecast income
|
5.0
|
1.8
|
|
(5.0)
|
(1.8)
|
|
(4.3)
|
Effective tax rate
|
(1.0)
|
0.2
|
|
1.0
|
(0.2)
|
|
8.3
|
Capital requirements - CET 1 ratio
|
(1.0)
|
0.1
|
|
1.0
|
(0.1)
|
|
22.3
|
Terminal growth rate
|
1.0
|
0.7
|
|
(1.0)
|
(0.5)
|
|
(3.9)
|
Pre-tax discount rate
|
(1.0)
|
1.4
|
|
1.0
|
(1.1)
|
|
1.4
|
|
|
|
|
|
|
|
|
31 December 2019
|
|
|
|
|
|
|
|
ECL loss rates
|
(0.16)
|
1.6
|
|
0.10
|
(1.0)
|
|
0.41
|
Cost:income ratio
|
(1.0)
|
1.6
|
|
4.5
|
(0.7)
|
|
12.6
|
Forecast income
|
5.0
|
2.1
|
|
(5.0)
|
(2.1)
|
|
(9.8)
|
Effective tax rate
|
(1.0)
|
0.2
|
|
1.0
|
(0.2)
|
|
17.1
|
Capital requirements - CET 1 ratio
|
(1.0)
|
0.2
|
|
1.0
|
(0.2)
|
|
22.2
|
Terminal growth rate
|
1.0
|
0.8
|
|
(1.0)
|
(0.7)
|
|
(3.1)
|
Pre-tax discount rate
|
(1.0)
|
2.3
|
|
1.0
|
(1.8)
|
|
2.7
|
|
|
|
|
30 June
|
31 December
|
|
2020
|
2019
|
|
£m
|
£m
|
Guarantees
|
2,457
|
2,757
|
Other contingent liabilities
|
2,388
|
2,478
|
Standby facilities, credit lines and other commitments
|
119,469
|
119,760
|
Contingent liabilities and commitments
|
124,314
|
124,995
|
Howard
Davies
|
Alison
Rose-Slade
|
Katie
Murray
|
Chairman
|
Group
Chief Executive Officer
|
Group
Chief Financial Officer
|
Chairman
|
Executive directors
|
Non-executive directors
|
Howard
Davies
|
Alison
Rose-Slade
Katie
Murray
|
Frank
Dangeard
Patrick
Flynn
Morten
Friis
Robert
Gillespie
Yasmin
Jetha
Baroness
Noakes
Mike
Rogers
Mark
Seligman
Lena
Wilson
|
●
|
Statutory
results on pages 78 to 106 comprising the condensed consolidated
income statement, condensed consolidated statement of comprehensive
income, condensed consolidated balance sheet, condensed
consolidated statement of changes in equity, condensed consolidated
cash flow statement and the related notes 1 to 18.
|
●
|
The
Capital and risk management section on pages 19 to 77 as indicated
within the scope of the independent review.
|
|
30 June
2020
|
31
March
2020
|
31
December
2019
|
|
|
|
|
Ordinary share price (pence)
|
121.6
|
112.9
|
240.3
|
|
|
|
|
Number of ordinary shares in issue (millions)
|
12,125
|
12,094
|
12,094
|
2020
third quarter interim management statement
|
30
October 2020
|
Analyst
enquiries:
|
Alexander Holcroft,
Investor Relations
|
+44 (0) 20 7672
1758
|
Media
enquiries:
|
NatWest Group Press
Office
|
+44
(0) 131 523 4205
|
|
Management presentation
|
Fixed income call
|
Web cast and dial in details
|
Date:
|
Friday
31 July 2020
|
Friday
31 July 2020
|
https://investors.natwestgroup.com/results-centre
|
Time:
|
9:00 am
UK time
|
1:30 pm
UK time
|
International
– +44 (0) 20 3057 6566
|
Conference ID:
|
8081948
|
7584097
|
UK Free
Call – 0800 279 6637
US
Local Dial-In, New York - 1 646 517 5063
|
●
|
Interim
Results 2020 and background slides.
|
●
|
A
financial supplement containing income statement, balance sheet and
segment performance information for the nine quarters ended 30 June
2020.
|
●
|
NatWest
Group and NWH Group Pillar 3 supplement at 30 June
2020.
|
Measure
|
Basis of preparation
|
Additional analysis or reconciliation
|
NatWest Group return on tangible equity
|
Annualised profit for the period attributable to ordinary
shareholders divided by average tangible equity. Average tangible
equity is average total equity less average intangible assets and
average other owners’ equity.
|
Table 1
|
Segmental return on tangible equity
|
Annualised segmental operating profit adjusted for tax and for
preference share dividends divided by average notional equity,
allocated at an operating segment specific rate, of the period
average segmental risk-weighted assets incorporating the effect of
capital deductions (RWAe).
|
Table 1
|
Operating expenses analysis – management view
|
The
management analysis of operating expenses shows strategic costs and
litigation and conduct costs in separate lines. Depreciation and
amortisation, impairment of other intangibles and other
administrative expenses attributable to these costs are included in
strategic costs and litigation and conduct costs lines for
management analysis.
These
amounts are included in staff, premises and equipment and other
administrative expenses in the statutory analysis.
|
Table 2
|
Cost:income ratio
|
Total
operating expenses less operating lease depreciation divided by
total income less operating lease depreciation.
|
Table 3
|
Commentary – adjusted periodically for specific
items
|
NatWest
Group and segmental business performance commentary have been
adjusted for the impact of specific items such as transfers,
strategic, litigation and conduct costs (detailed on pages 14 to
18).
|
Notable
items - page 5
Transfers
– page 10
Strategic,
litigation and conduct costs - pages 14 to 18
|
Bank net interest margin (NIM)
|
Net interest income of the banking business less NatWest Markets
(NWM) element as a percentage of interest-earning assets of the
banking business less NWM element.
|
Table 4
|
Measure
|
Basis of preparation
|
Additional analysis or reconciliation
|
Loan:deposit ratio
|
Net customer loans held at amortised cost divided by total customer
deposits.
|
Table 5
|
Tangible net asset value (TNAV)
|
Tangible
equity divided by the number of ordinary shares in issue. Tangible
equity is ordinary shareholders’ interest less intangible
assets.
|
Page
4
|
NIM
|
Net interest income of the banking business as a percentage of
interest-earning assets of the banking business.
|
Pages
14 to 18
|
Funded assets
|
Total
assets less derivatives.
|
Pages
14 to 18
|
ECL loss rate
|
The
annualised loan impairment charge divided by gross customer
loans.
|
Pages
14 to 18
|
|
Half year ended and
|
|
|
|||
|
as at
|
|
Quarter ended and as at
|
|||
|
30 June
|
30 June
|
|
30 June
|
31 March
|
30 June
|
|
2020
|
2019
|
|
2020
|
2020
|
2019
|
(Loss)/profit attributable to ordinary shareholders
(£m)
|
(705)
|
2,038
|
|
(993)
|
288
|
1,331
|
Adjustment for Alawwal bank merger gain (£m)
|
|
(764)
|
|
|
|
|
Adjusted profit attributable to ordinary shareholders
(£m)
|
|
1,274
|
|
|
|
|
Annualised (loss)/profit attributable to ordinary shareholders
(£m)
|
(1,410)
|
4,076
|
|
(3,972)
|
1,152
|
5,324
|
Annualised adjusted profit attributable to ordinary shareholders
(£m)
|
|
2,548
|
|
|
|
|
|
|
|
|
|
|
|
Average total equity (£m)
|
44,026
|
46,310
|
|
44,068
|
44,018
|
46,179
|
Adjustment for other owners equity and intangibles
(£m)
|
(11,911)
|
(12,528)
|
|
(11,987)
|
(11,911)
|
(12,410)
|
Adjusted total tangible equity (£m)
|
32,115
|
33,782
|
|
32,081
|
32,107
|
33,769
|
|
|
|
|
|
|
|
Return on tangible equity (%)
|
(4.4%)
|
12.1%
|
|
(12.4%)
|
3.6%
|
15.8%
|
Return on tangible equity adjusting for impact for Alawwal bank
merger (%)
|
|
7.5%
|
|
|
|
|
|
UK Personal
|
Ulster
|
Commercial
|
Private
|
RBS
|
NatWest
|
Half year ended 30 June 2020
|
Banking
|
Bank RoI
|
Banking
|
Banking
|
International
|
Markets
|
Operating profit/(loss) (£m)
|
453
|
(239)
|
(1,008)
|
84
|
87
|
69
|
Preference share cost allocation (£m)
|
(44)
|
-
|
(76)
|
(11)
|
(10)
|
(34)
|
Adjustment for tax (£m)
|
(115)
|
-
|
304
|
(20)
|
(11)
|
(10)
|
Adjusted attributable profit/(loss) (£m)
|
294
|
(239)
|
(780)
|
53
|
66
|
25
|
Annualised adjusted attributable profit/(loss)
(£m)
|
588
|
(478)
|
(1,560)
|
106
|
132
|
50
|
Average RWAe (£bn)
|
38.0
|
12.7
|
75.9
|
10.2
|
7.0
|
41.9
|
Equity factor
|
14.5%
|
15.5%
|
11.5%
|
12.5%
|
16.0%
|
15.0%
|
RWAe applying equity factor (£bn)
|
5.5
|
2.0
|
8.7
|
1.3
|
1.1
|
6.3
|
Return on equity (%)
|
10.7%
|
(24.2%)
|
(17.9%)
|
8.2%
|
11.8%
|
0.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Half year ended 30 June 2019
|
|
|
|
|
|
|
Operating profit (£m)
|
1,037
|
23
|
701
|
155
|
194
|
300
|
Adjustment for tax (£m)
|
(290)
|
-
|
(196)
|
(43)
|
(27)
|
(84)
|
Preference share cost allocation (£m)
|
(36)
|
-
|
(82)
|
(8)
|
-
|
(30)
|
Adjusted attributable profit (£m)
|
711
|
23
|
423
|
104
|
167
|
186
|
Annualised adjusted attributable profit (£m)
|
1,422
|
46
|
846
|
207
|
334
|
372
|
Adjustment for Alawwal bank merger gain (£m)
|
-
|
-
|
-
|
-
|
-
|
(299)
|
Annualised adjusted profit
attributable
|
|
|
|
|
|
|
to ordinary shareholders (£m)
|
1,422
|
46
|
846
|
207
|
334
|
73
|
Average RWAe (£bn)
|
37.0
|
14.3
|
79.6
|
9.6
|
7.0
|
49.2
|
Equity factor
|
15.0%
|
15.0%
|
12.0%
|
13.0%
|
16.0%
|
15.0%
|
RWAe applying equity factor (£bn)
|
5.5
|
2.1
|
9.6
|
1.2
|
1.1
|
7.4
|
Return on equity (%)
|
25.6%
|
2.1%
|
8.8%
|
16.6%
|
29.7%
|
1.0%
|
|
UK Personal
|
Ulster
|
Commercial
|
Private
|
RBS
|
NatWest
|
Quarter ended 30 June 2020
|
Banking
|
Bank RoI
|
Banking
|
Banking
|
International
|
Markets
|
Operating profit/(loss) (£m)
|
129
|
(218)
|
(971)
|
35
|
19
|
(137)
|
Preference share cost allocation (£m)
|
(22)
|
-
|
(38)
|
(5)
|
(5)
|
(17)
|
Adjustment for tax (£m)
|
(30)
|
-
|
283
|
(8)
|
(2)
|
43
|
Adjustment attributable profit/(loss) (£m)
|
77
|
(218)
|
(726)
|
22
|
12
|
(111)
|
Annualised adjusted attributable profit/(loss)
(£m)
|
308
|
(872)
|
(2,904)
|
88
|
48
|
(444)
|
Monthly average RWAe (£bn)
|
37.4
|
12.6
|
77.8
|
10.3
|
7.1
|
41.8
|
Equity factor
|
14.5%
|
15.5%
|
11.5%
|
12.5%
|
16.0%
|
15.0%
|
RWAe applying equity factor (£bn)
|
5.4
|
2.0
|
8.9
|
1.3
|
1.1
|
6.3
|
Return on equity (%)
|
5.7%
|
(44.5%)
|
(32.5%)
|
6.6%
|
4.3%
|
(7.1%)
|
|
|
|
|
|
|
|
Quarter ended 31 March 2020
|
|
|
|
|
|
|
Operating profit/(loss)(£m)
|
324
|
(21)
|
(37)
|
49
|
68
|
206
|
Preference share cost allocation (£m)
|
(22)
|
-
|
(38)
|
(6)
|
(5)
|
(17)
|
Adjustment for tax (£m)
|
(85)
|
-
|
21
|
(12)
|
(9)
|
(53)
|
Adjustment attributable profit/(loss) (£m)
|
217
|
(21)
|
(54)
|
31
|
54
|
136
|
Annualised adjusted attributable profit/(loss)
(£m)
|
868
|
(84)
|
(216)
|
124
|
217
|
544
|
Monthly average RWAe (£bn)
|
38.7
|
12.8
|
74.1
|
10.2
|
7.0
|
41.9
|
Equity factor
|
14.5%
|
15.5%
|
11.5%
|
12.5%
|
16.0%
|
15.0%
|
RWAe applying equity factor (£bn)
|
5.6
|
2.0
|
8.5
|
1.3
|
1.1
|
6.3
|
Return on equity (%)
|
15.5%
|
(4.2%)
|
(2.5%)
|
9.8%
|
19.4%
|
8.7%
|
|
|
|
|
|
|
|
Quarter ended 30 June 2019
|
|
|
|
|
|
|
Operating profit (£m)
|
539
|
3
|
264
|
75
|
101
|
362
|
Adjustment for tax (£m)
|
(151)
|
-
|
(74)
|
(21)
|
(14)
|
(101)
|
Preference share cost allocation (£m)
|
(18)
|
-
|
(41)
|
(4)
|
-
|
(30)
|
Adjustment attributable profit (£m)
|
370
|
3
|
149
|
50
|
87
|
231
|
Annualised adjusted attributable profit (£m)
|
1,480
|
12
|
596
|
199
|
345
|
924
|
Adjustment for Alawwal merger gain (£m)
|
-
|
-
|
-
|
-
|
-
|
(598)
|
Annualised adjusted profit attributable to
|
|
|
|
|
|
|
ordinary shareholders
(£m)
|
1,480
|
12
|
596
|
199
|
345
|
326
|
Monthly average RWAe (£bn)
|
37.2
|
14.3
|
80.1
|
9.6
|
7.0
|
49.1
|
Equity factor
|
15.0%
|
15.0%
|
12.0%
|
13.0%
|
16.0%
|
15.0%
|
RWAe applying equity factor (£bn)
|
5.6
|
2.1
|
9.6
|
1.2
|
1.1
|
7.4
|
Return on equity (%)
|
26.5%
|
0.6%
|
6.2%
|
15.9%
|
30.8%
|
4.4%
|
|
Half year ended
|
|
Quarter ended
|
|||
|
30 June
|
30 June
|
|
30 June
|
31 March
|
30 June
|
Operating expenses
|
2020
|
2019
|
|
2020
|
2020
|
2019
|
Staff costs
|
(1,955)
|
(2,028)
|
|
(963)
|
(992)
|
(1,017)
|
Premises and equipment
|
(651)
|
(558)
|
|
(393)
|
(258)
|
(293)
|
Other administrative expenses
|
(696)
|
(863)
|
|
(298)
|
(398)
|
(445)
|
Depreciation and amortisation
|
(441)
|
(621)
|
|
(248)
|
(193)
|
(377)
|
Impairment of other intangible assets
|
(7)
|
(30)
|
|
(7)
|
-
|
(30)
|
Total operating expenses
|
(3,750)
|
(4,100)
|
|
(1,909)
|
(1,841)
|
(2,162)
|
|
|
|
|
|
|
|
|
Half year ended
|
||||||||
|
30 June 2020
|
|
30 June 2019
|
||||||
|
|
Litigation
|
|
|
|
|
Litigation
|
|
|
|
|
and
|
|
Statutory
|
|
|
and
|
|
Statutory
|
|
Strategic
|
conduct
|
Other
|
operating
|
|
Strategic
|
conduct
|
Other
|
operating
|
Operating expenses
|
costs
|
costs
|
expenses
|
expenses
|
|
costs
|
costs
|
expenses
|
expenses
|
Staff costs
|
(160)
|
-
|
(1,795)
|
(1,955)
|
|
(187)
|
-
|
(1,841)
|
(2,028)
|
Premises and equipment
|
(148)
|
-
|
(503)
|
(651)
|
|
(65)
|
-
|
(493)
|
(558)
|
Other administrative expenses
|
(100)
|
89
|
(685)
|
(696)
|
|
(130)
|
(60)
|
(673)
|
(863)
|
Depreciation and amortisation
|
(49)
|
-
|
(392)
|
(441)
|
|
(222)
|
-
|
(399)
|
(621)
|
Impairment of other intangible assets
|
(7)
|
-
|
-
|
(7)
|
|
(25)
|
-
|
(5)
|
(30)
|
Total
|
(464)
|
89
|
(3,375)
|
(3,750)
|
|
(629)
|
(60)
|
(3,411)
|
(4,100)
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended
|
||||||||
|
30 June 2020
|
|
31 March 2020
|
||||||
|
|
Litigation
|
|
|
|
|
Litigation
|
|
|
|
|
and
|
|
Statutory
|
|
|
and
|
|
Statutory
|
|
Strategic
|
conduct
|
Other
|
operating
|
|
Strategic
|
conduct
|
Other
|
operating
|
Operating expenses
|
costs
|
costs
|
expenses
|
expenses
|
|
costs
|
costs
|
expenses
|
expenses
|
Staff costs
|
(87)
|
-
|
(876)
|
(963)
|
|
(73)
|
-
|
(919)
|
(992)
|
Premises and equipment
|
(135)
|
-
|
(258)
|
(393)
|
|
(13)
|
-
|
(245)
|
(258)
|
Other administrative expenses
|
(57)
|
85
|
(326)
|
(298)
|
|
(43)
|
4
|
(359)
|
(398)
|
Depreciation and amortisation
|
(47)
|
-
|
(201)
|
(248)
|
|
(2)
|
-
|
(191)
|
(193)
|
Impairment of other intangible assets
|
(7)
|
-
|
-
|
(7)
|
|
-
|
-
|
-
|
-
|
Total
|
(333)
|
85
|
(1,661)
|
(1,909)
|
|
(131)
|
4
|
(1,714)
|
(1,841)
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended
|
|
|
|
|
|
|||
|
30 June 2019
|
|
|
||||||
|
|
Litigation
|
|
|
|
|
|
|
|
|
|
and
|
|
Statutory
|
|
|
|
|
|
|
Strategic
|
conduct
|
Other
|
operating
|
|
|
|
|
|
Operating expenses
|
costs
|
costs
|
expenses
|
expenses
|
|
|
|
|
|
Staff costs
|
(112)
|
-
|
(905)
|
(1,017)
|
|
|
|
|
|
Premises and equipment
|
(48)
|
-
|
(245)
|
(293)
|
|
|
|
|
|
Other administrative expenses
|
(72)
|
(55)
|
(318)
|
(445)
|
|
|
|
|
|
Depreciation and amortisation
|
(177)
|
-
|
(200)
|
(377)
|
|
|
|
|
|
Impairment of other intangible assets
|
(25)
|
-
|
(5)
|
(30)
|
|
|
|
|
|
Total
|
(434)
|
(55)
|
(1,673)
|
(2,162)
|
|
|
|
|
|
|
UK Personal
|
Ulster
|
Commercial
|
Private
|
RBS
|
NatWest
|
Central items
|
NatWest
|
|
Banking
|
Bank RoI
|
Banking
|
Banking
|
International
|
Markets
|
& other
|
Group
|
Half year ended 30 June 2020
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Operating expenses
|
(1,075)
|
(245)
|
(1,221)
|
(252)
|
(126)
|
(707)
|
(124)
|
(3,750)
|
Operating lease depreciation
|
-
|
-
|
73
|
-
|
-
|
-
|
-
|
73
|
Adjusted operating expenses
|
(1,075)
|
(245)
|
(1,148)
|
(252)
|
(126)
|
(707)
|
(124)
|
(3,677)
|
|
|
|
|
|
|
|
|
|
Total income
|
2,185
|
249
|
2,003
|
392
|
259
|
816
|
(66)
|
5,838
|
Operating lease depreciation
|
-
|
-
|
(73)
|
-
|
-
|
-
|
-
|
(73)
|
Adjustment total income
|
2,185
|
249
|
1,930
|
392
|
259
|
816
|
(66)
|
5,765
|
|
|
|
|
|
|
|
|
|
Cost:income ratio (%)
|
49.2%
|
98.4%
|
59.5%
|
64.3%
|
48.6%
|
86.6%
|
nm
|
63.8%
|
|
|
|
|
|
|
|
|
|
Half year ended 30 June 2019
|
|
|
|
|
|
|
|
|
Operating expenses
|
(1,229)
|
(281)
|
(1,262)
|
(232)
|
(119)
|
(678)
|
(299)
|
(4,100)
|
Operating lease depreciation
|
-
|
-
|
68
|
-
|
-
|
-
|
-
|
68
|
Adjusted operating expenses
|
(1,229)
|
(281)
|
(1,194)
|
(232)
|
(119)
|
(678)
|
(299)
|
(4,032)
|
|
|
|
|
|
|
|
|
|
Total income
|
2,447
|
283
|
2,165
|
384
|
310
|
942
|
586
|
7,117
|
Operating lease depreciation
|
-
|
-
|
(68)
|
-
|
-
|
-
|
-
|
(68)
|
Adjustment total income
|
2,447
|
283
|
2,097
|
384
|
310
|
942
|
586
|
7,049
|
|
|
|
|
|
|
|
|
|
Cost:income ratio (%)
|
50.2%
|
99.3%
|
56.9%
|
60.4%
|
38.4%
|
72.0%
|
nm
|
57.2%
|
|
|
|
|
|
|
|
|
|
Quarter ended 30 June 2020
|
|
|
|
|
|
|
|
|
Operating expenses
|
(546)
|
(122)
|
(611)
|
(129)
|
(65)
|
(365)
|
(71)
|
(1,909)
|
Operating lease depreciation
|
-
|
-
|
37
|
-
|
-
|
-
|
-
|
37
|
Adjusted operating expenses
|
(546)
|
(122)
|
(574)
|
(129)
|
(65)
|
(365)
|
(71)
|
(1,872)
|
|
|
|
|
|
|
|
|
|
Total income
|
1,035
|
120
|
995
|
191
|
115
|
273
|
(53)
|
2,676
|
Operating lease depreciation
|
-
|
-
|
(37)
|
-
|
-
|
-
|
-
|
(37)
|
Adjustment total income
|
1,035
|
120
|
958
|
191
|
115
|
273
|
(53)
|
2,639
|
|
|
|
|
|
|
|
|
|
Cost income ratio (%)
|
52.8%
|
101.7%
|
59.9%
|
67.5%
|
56.5%
|
133.7%
|
nm
|
70.9%
|
|
|
|
|
|
|
|
|
|
Quarter ended 31 March 2020
|
|
|
|
|
|
|
|
|
Operating expenses
|
(529)
|
(123)
|
(610)
|
(123)
|
(61)
|
(342)
|
(53)
|
(1,841)
|
Operating lease depreciation
|
-
|
-
|
36
|
-
|
-
|
-
|
-
|
36
|
Adjusted operating expenses
|
(529)
|
(123)
|
(574)
|
(123)
|
(61)
|
(342)
|
(53)
|
(1,805)
|
|
|
|
|
|
|
|
|
|
Total income
|
1,150
|
129
|
1,008
|
201
|
144
|
543
|
(13)
|
3,162
|
Operating lease depreciation
|
-
|
-
|
(36)
|
-
|
-
|
-
|
-
|
(36)
|
Adjustment total income
|
1,150
|
129
|
972
|
201
|
144
|
543
|
(13)
|
3,126
|
|
|
|
|
|
|
|
|
|
Cost:income ratio (%)
|
46.0%
|
95.3%
|
59.1%
|
61.2%
|
42.4%
|
63.0%
|
nm
|
57.7%
|
|
|
|
|
|
|
|
|
|
Quarter ended 30 June 2019
|
|
|
|
|
|
|
|
|
Operating expenses
|
(594)
|
(145)
|
(622)
|
(115)
|
(60)
|
(344)
|
(282)
|
(2,162)
|
Operating lease depreciation
|
-
|
-
|
34
|
-
|
-
|
-
|
-
|
34
|
Adjusted operating expenses
|
(594)
|
(145)
|
(588)
|
(115)
|
(60)
|
(344)
|
(282)
|
(2,128)
|
|
|
|
|
|
|
|
|
|
Total income
|
1,202
|
138
|
1,083
|
191
|
159
|
686
|
621
|
4,080
|
Operating lease depreciation
|
-
|
-
|
(34)
|
-
|
-
|
-
|
-
|
(34)
|
Adjustment total income
|
1,202
|
138
|
1,049
|
191
|
159
|
686
|
621
|
4,046
|
|
|
|
|
|
|
|
|
|
Cost:income ratio (%)
|
49.4%
|
105.1%
|
56.1%
|
60.2%
|
37.7%
|
50.1%
|
nm
|
52.6%
|
|
Half year ended
|
|
Quarter ended
|
|||
|
30 June
|
30 June
|
|
30 June
|
31 March
|
30 June
|
|
2020
|
2019
|
|
2020
|
2020
|
2019
|
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
NatWest Group net interest income
|
3,852
|
4,004
|
|
1,910
|
1,942
|
1,971
|
NWM net interest income
|
34
|
122
|
|
(6)
|
40
|
91
|
Net interest income excluding NWM
|
3,886
|
4,126
|
|
1,904
|
1,982
|
2,062
|
Annualised net interest income
|
7,746
|
8,074
|
|
7,682
|
7,811
|
7,906
|
Annualised net interest income excluding NWM
|
7,815
|
8,320
|
|
7,658
|
7,972
|
8,271
|
Average interest earning assets (IEA)
|
477,898
|
440,309
|
|
497,440
|
458,514
|
444,800
|
NWM average IEA
|
37,994
|
33,261
|
|
39,874
|
36,113
|
34,436
|
Average IEA excluding NWM
|
439,904
|
407,048
|
|
457,566
|
422,401
|
410,364
|
|
|
|
|
|
|
|
Net interest margin
|
1.62%
|
1.83%
|
|
1.54%
|
1.70%
|
1.78%
|
Bank net interest margin (excluding NWM)
|
1.78%
|
2.04%
|
|
1.67%
|
1.89%
|
2.02%
|
|
|
|
As at
|
|||
|
|
|
|
30 June
|
31 March
|
30 June
|
|
|
|
|
2020
|
2020
|
2019
|
|
|
|
|
£bn
|
£bn
|
£bn
|
Loans to customers - amortised cost
|
|
|
|
352,341
|
351,328
|
310,631
|
Customer deposits
|
|
|
|
408,268
|
384,800
|
361,626
|
Loan:deposit ratio (%)
|
|
|
|
86%
|
91%
|
86%
|
|
NATWEST
GROUP plc (Registrant)
|
|
|
|
By: /s/
Jan Cargill
|
|
|
|
Name:
Jan Cargill
|
|
Title:
Deputy Secretary
|