|
|
●
|
CET1
ratio of 16.6%, 40 basis points higher than Q4 2019, which includes
a c.75 basis point increase associated with the release of the
foreseeable dividend and pension contribution capital deductions as
previously announced. RWAs increased by £6.0 billion
reflecting lending growth in the retail and commercial businesses
and an increase in NatWest Markets.
|
●
|
LCR
remains healthy at 152%, representing £49.5 billion headroom
above 100%.
|
●
|
Net
lending increased by £13.1 billion in the quarter across the
retail and commercial businesses driven by mortgage lending in UK
Personal Banking and an £8.0 billion increase in Commercial
Banking reflecting the utilisation of revolving credit facilities
(RCFs) in response to Covid-19 uncertainty.
|
●
|
Customer
deposits increased by £15.6 billion compared with Q4 2019
principally reflecting an £8.9 billion increase in Commercial
Banking as customers sought to retain liquidity in response to
Covid-19 uncertainty.
|
Q1 2020 financial performance
|
|
●
|
RBS
reported an operating profit before tax of £519 million and an
attributable profit of £288 million.
|
●
|
Total
income, excluding notable items and own credit adjustments,
decreased by 1.6% in comparison to Q1 2019. Across the retail and
commercial businesses income decreased by 6.5% whilst NatWest
Markets core income increased by 9.3%.
|
●
|
Bank
net interest margin (NIM) of 1.89% was 4 basis points lower than Q4
2019 reflecting continued structural pressure in the mortgage
business, as front book margins remain below back book, and the
contraction of the yield curve.
|
●
|
Litigation
and conduct costs include a £100 million PPI release offset by
other charges.
|
●
|
Strategic
costs of £131 million include a £39 million charge
related to technology spend and a £34 million direct charge in
NatWest Markets in respect of restructuring activity.
|
●
|
A cost
reduction of £26 million was achieved in the quarter
excluding operating lease depreciation. The Bank’s key focus
is on supporting our customers and colleagues through this period
of uncertainty, while preserving shareholder value, and we remain
on track to deliver a £250 million cost reduction in
2020.
|
●
|
Net
impairment losses of £802 million equate to 90 basis points of
gross customer loans, compared with 11 basis points in Q1 2019. Q1
2020 includes a £628 million charge in respect of a more
uncertain economic outlook, bringing our total multiple economic
scenario (MES) overlay to £798 million.
|
●
|
Net
loans to customers increased by £24.4 billion in Q1 2020, of
which £13.1 billion related to growth across the retail and
commercial businesses and £7.5 billion was within central
items, mainly reflecting reverse repo activity as part of treasury
liquidity management. UK Personal Banking increased by £4.8
billion, with gross new mortgage lending of £10.4 billion in
the quarter. Commercial Banking increased by £8.0 billion
reflecting the utilisation of RCFs in response to Covid-19
uncertainty.
|
●
|
Customer
deposits increased by £15.6 billion compared with Q4 2019
principally reflecting an £8.9 billion increase in Commercial
Banking as customers sought to retain liquidity in response to
Covid-19 uncertainty.
|
●
|
UK
Personal Banking gross new mortgage lending was £1.3 billion
largely reflecting re-mortgage business as the level of new
business in the UK market reduces.
|
●
|
As at
23 April, RBS has extended repayment holidays to over 190,000
mortgage customers.
|
●
|
Since
the inception of the Coronavirus Business Interruption Loan Scheme
(CBILS), £1,376 million loans have been approved.
|
●
|
RBS has
facilitated £3,105 million of Covid-19 Corporate Financing
Facilities (CCFF) issuances by the Bank of England on behalf of our
customers.
|
●
|
Support
under the Coronavirus Large Business Interruption Loan Scheme
(CLBILS) has commenced and as at 23 April 2020, £29 million of
loans had been requested.
|
●
|
Commercial
Banking has provided gross new lending of £2,015 million to
support our customers, including £501 million to Large
Corporates & Institutions, £420 million to SMEs & Mid
Corporates and £623 million to Real Estate.
|
●
|
Utilisations
of RCFs in Commercial Banking have stabilised at around 40% of
committed facilities following the increased drawdowns in Q1
2020.
|
●
|
RBS
International has, as at 23 April 2020, supported 1,418 personal
customers with mortgage or loan repayment breaks and new overdraft
facilities and 413 business customers with loan repayment breaks or
working capital facilities.
|
●
|
As
announced on 1 April 2020, RBS has decided not to undertake interim
dividend payments or share buybacks, take no charge in CET1 for
foreseeable dividends and to defer decisions on any future
shareholder distributions until the end of 2020. In response to a
formal request from the Prudential Regulation Authority, the Board
has also decided to cancel the final ordinary and special dividend
payments in relation to the 2019 financial year. The Board
remains committed to capital returns, will continue to review the
situation and will look to resume distributions to ordinary
shareholders in due course.
|
As
outlined in our 2019 Annual Report and Accounts, the central
economic forecast supporting our corporate plan was in line with
the December 2019 consensus view. This assumed average UK GDP
growth of c.1.6% from 2019 to 2023, with a 25 basis point cut in
the Bank of England Base rate in 2020. Clearly this position has
deteriorated sharply in recent weeks and the conditions facing the
UK economy, along with the associated government and regulatory
response, are unprecedented. The outlook is now subject to
significant uncertainty and we will continue to refine our internal
forecast as the economic position evolves.
|
2020 Outlook
|
The
latest outlook for central bank rates to remain at historic lows
and flat yield curves will adversely impact the Bank’s income
generation. As noted above, the Bank’s corporate plan assumed
a 25 basis point rate cut in 2020 compared with the recent
reductions of 65 basis points.
In
addition to the impact of ongoing market uncertainty, and in line
with the guidance in our 2019 Annual Report and Accounts, we
continue to expect that regulatory changes will adversely impact
income in our personal business by around £200
million.
Whilst
we remain committed to our £250 million cost reduction target,
achieving planned reductions in the current environment is likely
to prove more challenging although this will be mitigated by
rebalancing of the investment pool and other cost saving
initiatives. We now expect strategic costs to be at the lower end
of our previous guidance of £0.8-1.0 billion for the year. We
retain the longer term commitment to re-shaping the Bank to be fit
for the future and driving sustainable success.
In Q1
2020 our impairment loss rate was 90 basis points of gross customer
loans. We expect the full year 2020 loss rate will be meaningfully
higher than our guidance of below 30-40 basis points. The impacts
of Covid-19 and the mitigating benefits of government schemes are
uncertain and challenging to forecast accurately. At this time it
would be inappropriate to provide full year loss rate
guidance.
We
expect to achieve lending growth of greater than 3% across our
retail and commercial businesses, given the significant increase in
lending during 2020 to date.
Given
the current uncertainty the level of risk weighted assets (RWAs) at
the end of 2020 is very likely to exceed the £185-190 billion
range we previously guided to. We do however continue to target a
reduction in NatWest Markets RWAs to around £32 billion by the
end of 2020 and expect to achieve this with lower income disposal
losses than the £0.4 billion previously guided to, subject to
market conditions.
RBS
Group maintains its capital and funding issuance guidance as set
out in the 2019 Annual Report and Account, subject to market
conditions and any changes in the 2020 balance sheet
profile.
|
Medium term outlook
|
We
remain committed to the strategic objectives and priorities we
announced as part of our full year 2019 results. Whilst we are
closely monitoring events and assessing potential scenarios and
outcomes, reflecting the significant deterioration in economic
outlook and unprecedented levels of uncertainty it would be
inappropriate to provide an update on medium term outlook at this
time.
As
previously announced, we will not undertake interim dividend
payments or share buybacks, take charges in CET1 for foreseeable
dividends and will defer decisions on any future shareholder
distributions until the end of 2020.
Note:
(1) The guidance,
targets, expectations and trends discussed in this section
represent management’s current expectations and are subject
to change, including as a result of the factors described in the
“Risk Factors” section on pages 29 to 31 of this
announcement, pages 281 to 295 of RBS Group’s 2019 Annual
Report and Accounts and on pages 143 and 156 of NatWest Markets
Plc’s 2019 Annual Results. These statements constitute
forward-looking statements. Refer to Forward-looking statements in
this announcement.
|
|
|
|
|
Quarter ended
|
||
|
|
|
|
31 March
|
31 December
|
31 March
|
Performance key metrics and ratios
|
|
|
|
2020
|
2019
|
2019
|
Profit before impairment losses
|
|
|
|
£1,321m
|
£1,706m
|
£1,099m
|
Operating profit before tax
|
|
|
|
£519m
|
£1,546m
|
£1,013m
|
Profit attributable to ordinary shareholders
|
|
|
|
£288m
|
£1,410m
|
£707m
|
Bank net interest margin (RBS NIM excluding NWM)
(1)
|
|
|
|
1.89%
|
1.93%
|
2.07%
|
Bank average interest earning assets (RBS excluding NWM)
(1)
|
|
|
£422bn
|
£420bn
|
£404bn
|
|
Cost:income ratio (1)
|
|
|
|
57.7%
|
59.4%
|
63.4%
|
Loan impairment rate (1)
|
|
|
|
90bps
|
19bps
|
11bps
|
Earnings per share
|
|
|
|
|
|
|
-
basic
|
|
|
|
2.4p
|
11.7p
|
5.9p
|
- basic fully
diluted
|
|
|
|
2.4p
|
11.6p
|
5.8p
|
Return on tangible equity (1)
|
|
|
|
3.6%
|
17.7%
|
8.3%
|
Average tangible equity
|
|
|
|
£32bn
|
£32bn
|
£34bn
|
Average number of ordinary shares
|
|
|
|
|
|
|
outstanding during the
period (millions)
|
|
|
|
|
|
|
-
basic
|
|
|
|
12,074
|
12,078
|
12,047
|
- fully diluted
(2)
|
|
|
|
12,100
|
12,114
|
12,087
|
|
31 March
|
31 December
|
31 March
|
Balance sheet key metrics and ratios
|
2020
|
2019
|
2019
|
Total assets
|
£817.6bn
|
£723.0 bn
|
£719.1bn
|
Funded assets (1)
|
£608.9bn
|
£573.0bn
|
£585.1bn
|
Loans to customers - amortised cost
|
£351.3bn
|
£326.9bn
|
£306.4bn
|
Impairment provisions
|
£4.2bn
|
£3.7bn
|
£3.6bn
|
Customer deposits
|
£384.8bn
|
£369.2bn
|
£355.2bn
|
|
|
|
|
Liquidity coverage ratio (LCR)
|
152%
|
152%
|
153%
|
Liquidity portfolio
|
£201bn
|
£199bn
|
£190bn
|
Net stable funding ratio (NSFR) (3)
|
138%
|
141%
|
137%
|
Loan:deposit ratio (1)
|
91%
|
89%
|
86%
|
Total wholesale funding
|
£86bn
|
£75bn
|
£77bn
|
Short-term wholesale funding
|
£32bn
|
£19bn
|
£19bn
|
|
|
|
|
Common Equity Tier (CET1) ratio
|
16.6%
|
16.2%
|
16.2%
|
Total capital ratio
|
21.4%
|
21.2%
|
21.1%
|
Pro forma CET 1 ratio, pre dividend accrual (4)
|
16.6%
|
17.0%
|
16.3%
|
Risk-weighted assets (RWAs)
|
£185.2bn
|
£179.2bn
|
£190.8bn
|
CRR leverage ratio
|
5.1%
|
5.1%
|
5.2%
|
UK leverage ratio
|
5.8%
|
5.8%
|
6.0%
|
|
|
|
|
Tangible net asset value (TNAV) per ordinary share
|
273p
|
268p
|
289p
|
Tangible net asset value (TNAV) per ordinary share - fully
diluted (1,2)
|
272p
|
267p
|
288p
|
Tangible equity
|
£32,990m
|
£32,371m
|
£34,962m
|
Number of ordinary shares in issue (millions)
|
12,094
|
12,094
|
12,090
|
Number of ordinary shares in issue (millions) - fully
diluted (2,5)
|
12,116
|
12,138
|
12,129
|
|
|
|
|
Quarter ended
|
||
|
|
|
|
31 March
|
31 December
|
31 March
|
|
|
|
|
2020
|
2019
|
2019
|
|
|
|
|
£m
|
£m
|
£m
|
Net interest income
|
|
|
|
1,942
|
2,037
|
2,033
|
Own credit adjustments
|
|
|
|
155
|
(22)
|
(43)
|
Other non-interest income
|
|
|
|
1,065
|
2,218
|
1,047
|
Non-interest income
|
|
|
|
1,220
|
2,196
|
1,004
|
Total income
|
|
|
|
3,162
|
4,233
|
3,037
|
Litigation and conduct costs
|
|
|
|
4
|
(85)
|
(5)
|
Strategic costs
|
|
|
|
(131)
|
(537)
|
(195)
|
Other expenses
|
|
|
|
(1,714)
|
(1,905)
|
(1,738)
|
Operating expenses
|
|
|
|
(1,841)
|
(2,527)
|
(1,938)
|
Profit before impairment losses
|
|
|
|
1,321
|
1,706
|
1,099
|
Impairment losses
|
|
|
|
(802)
|
(160)
|
(86)
|
Operating profit before tax
|
|
|
|
519
|
1,546
|
1,013
|
Tax charge
|
|
|
|
(188)
|
(37)
|
(216)
|
Profit for the period
|
|
|
|
331
|
1,509
|
797
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
Ordinary shareholders
|
|
|
|
288
|
1,410
|
707
|
Preference shareholders
|
|
|
|
8
|
9
|
10
|
Paid-in equity holders
|
|
|
|
97
|
90
|
90
|
Non-controlling interests
|
|
|
|
(62)
|
-
|
(10)
|
Notable items within income
|
|
|
|
|
|
|
FX recycling (loss)/gain in Central items & other
(1)
|
|
|
|
(64)
|
1,169
|
-
|
Liquidity Asset Bond sale gain
|
|
|
|
93
|
(8)
|
(10)
|
IFRS volatility in Central items & other
|
|
|
|
(66)
|
43
|
(4)
|
UK Personal Banking debt sale gain
|
|
|
|
-
|
31
|
2
|
|
|
|
|
|
|
|
Notable items within operating expenses
|
|
|
|
|
|
|
Litigation and conduct costs
|
|
|
|
4
|
(85)
|
(5)
|
(1)
|
Q4 2019
includes £1,102 million arising on the liquidation of RFS
Holdings and £67 million in relation to dividends in UBI
DAC.
|
|
Quarter ended
|
|
|
As at
|
|||
|
31 March
|
31 December
|
31 March
|
|
|
31 March
|
31 December
|
|
2020
|
2019
|
2019
|
|
|
2020
|
2019
|
|
£m
|
£m
|
£m
|
|
|
£bn
|
£bn
|
Total income (1)
|
1,150
|
1,195
|
1,245
|
|
Net loans to customers -
|
|
|
Operating
|
|
|
|
|
amortised cost
|
163.7
|
158.9
|
expenses (1)
|
(529)
|
(788)
|
(635)
|
|
Customer deposits (1)
|
152.8
|
150.3
|
Impairment losses
|
(297)
|
(81)
|
(112)
|
|
RWAs
|
38.2
|
37.8
|
Operating profit
|
324
|
326
|
498
|
|
|
|
|
Return on equity
|
15.5%
|
14.9%
|
24.7%
|
|
|
|
|
Net interest margin
|
2.28%
|
2.32%
|
2.62%
|
|
|
|
|
Cost:income ratio
|
46.0%
|
65.9%
|
51.0%
|
|
|
|
|
Loan impairment rate
|
72bps
|
20bps
|
30bps
|
|
|
|
|
Note:
(1)
|
Comparisons
with prior periods are impacted by the transfer of the Private
Client Advice business to Private Banking from 1 January 2020. The
net impact on Q1 2019 operating profit would have been to
decrease total income by £11 million and operating expenses by
£2 million. The net impact on the Q4 2019 balance sheet would
have been to decrease customer deposits by £0.2
billion.
|
●
|
UK
Personal Banking has worked in partnership with UK regulators to
support customers whose income has been impacted by Covid-19 via
the option of three month repayment breaks on mortgages, loans and
credit cards, waiver of certain overdraft and credit card fees, and
an increased limit for debit card cash withdrawals.
|
●
|
More
than 90% of our branches remain open, together with all operations
services and sales support in unprecedented times.
|
●
|
Total
income was £95 million, or 7.6%, lower than Q1 2019 due to
lower deposit income and mortgage margin dilution, partially offset
by strong balance growth. Net interest margin decreased by 4 basis
points in comparison to Q4 2019, reflecting continued structural
pressure in the mortgage business, as blended front book margins of
around 110 basis points remain lower than the back book margin of
approximately 140 basis points. Strong lending growth offsets, with
net interest income £5 million lower than Q4 2019. In the
latter part of March 2020 blended front book application margins
were around 125 basis points.
|
●
|
Litigation
and conduct costs include a £100 million PPI release,
reflecting lower than predicted valid complaints
volumes.
|
●
|
Impairment
losses of £297 million include a £185 million charge
reflecting a more uncertain economic outlook.
|
●
|
Net
loans to customers increased by £4.8 billion, or 3.0%, in
comparison to Q4 2019 with gross new mortgage lending in the
quarter of £10.4 billion and market flow share of
approximately 17%. Customer deposits increased by £2.5
billion, or 1.7%, with stronger than normal growth towards the end
of March following government measures to respond to Covid-19,
resulting in lower consumer spend.
|
|
Quarter ended
|
|
|
As at
|
|||
|
31 March
|
31 December
|
31 March
|
|
|
31 March
|
31 December
|
|
2020
|
2019
|
2019
|
|
|
2020
|
2019
|
|
€m
|
€m
|
€m
|
|
|
€bn
|
€bn
|
Total income
|
150
|
162
|
166
|
|
Net loans to customers -
|
|
|
Operating expenses
|
(143)
|
(162)
|
(156)
|
|
amortised cost
|
21.2
|
21.4
|
Impairment (losses)/releases
|
(32)
|
(5)
|
13
|
|
Customer deposits
RWAs
|
21.9
14.4
|
21.7
15.3
|
Operating (loss)/profit
|
(25)
|
(5)
|
23
|
|
|
|
|
Return on equity
|
(4.2%)
|
(1.0%)
|
3.8%
|
|
|
|
|
Net interest margin
|
1.56%
|
1.57%
|
1.65%
|
|
|
|
|
Cost:income ratio
|
95.3%
|
100.7%
|
93.8%
|
|
|
|
|
Loan impairment rate
|
58bps
|
9bps
|
(23)bps
|
|
|
|
|
●
|
Ulster
Bank RoI has, in conjunction with the Irish Government and other
banks, responded quickly to help customers who have been
financially impacted by Covid-19. In our personal business, our
branches have remained open and we have put in place a support team
dedicated to support frontline workers. We have introduced the
option for payment breaks on mortgages and loans; early closure of
fixed savings accounts without penalty and; increased overdraft,
credit card, cash withdrawal and contactless payment limits. In our
commercial business, we have launched a €0.5 billion support
fund for businesses, increased revolving credit facilities and
introduced the option for loan payment breaks.
|
●
|
Total
income was €16 million, or 9.6%, lower than Q1 2019 largely
reflecting the non-repeat of an €11 million one-off benefit
following the restructure of interest rate swaps on free funds. Net
interest margin remained broadly stable with Q4 2019.
|
●
|
Impairment
losses of €32 million include a €38 million charge
reflecting a more uncertain economic outlook and a €12
million charge for other post model adjustments, partially offset
by a number of releases.
|
●
|
Net
loans to customers were €0.2 billion lower than Q4 2019
arising from the initial de-recognition of a non-performing loan
(NPL) sale agreed in Q4 2019. The business maintained a prudent
approach to risk and pricing in a competitive market, with gross
new lending of €0.7 billion in the quarter.
|
|
Quarter ended
|
|
|
As at
|
|||
|
31 March
|
31 December
|
31 March
|
|
|
31 March
|
31 December
|
|
2020
|
2019
|
2019
|
|
|
2020
|
2019
|
|
£m
|
£m
|
£m
|
|
|
£bn
|
£bn
|
Total income
|
1,008
|
1,076
|
1,082
|
|
Net loans to customers -
|
|
|
Operating expenses
|
(610)
|
(700)
|
(640)
|
|
amortised cost
|
109.2
|
101.2
|
Impairment losses
|
(435)
|
(81)
|
(5)
|
|
Customer deposits
|
143.9
|
135.0
|
Operating profit
|
(37)
|
295
|
437
|
|
RWAs
|
76.9
|
72.5
|
Return on equity
|
(2.5%)
|
7.6%
|
11.5%
|
|
|
|
|
Net interest margin
|
1.83%
|
1.94%
|
1.99%
|
|
|
|
|
Cost:income ratio
|
59.1%
|
63.9%
|
57.8%
|
|
|
|
|
Loan impairment rate
|
157bps
|
32bps
|
2bps
|
|
|
|
|
●
|
Commercial
Banking are offering support to our customers (sole traders,
partnerships and limited liability companies) through participating
in the UK Government’s CLBILS and CBILS. As at 23 April 2020,
£1.4 billion of CBILS loans have been approved, with a
minimum loan size of £5,000 and without requiring the
provision of personal guarantees.
|
●
|
To help
our customers adapt to the rapidly changing external environment
Commercial Banking have introduced the option of capital repayment
holidays for up to six months and as at 23 April 2020, over 42,000
capital repayment holiday requests have been received. We have also
extended our existing working capital fund by £5 billion,
and provided immediate access to notice and fixed term deposits
without penalty. To further help our SME customers meet short to
medium term funding requirements Commercial Banking are providing
fee free overdrafts up to £5,000 for the next three months,
and Tyl by NatWest has waived Point of Sale terminal fees, making
it free for all new and existing customers from April to December
2020.
|
●
|
Total
income was £74 million, or 6.8%, lower than Q1 2019 due to
lower deposit funding benefits and legacy reductions. Net interest
margin decreased by 11 basis points compared with Q4 2019
reflecting the review on customer repayment behaviour changes in Q4
2019, lower deposit income and higher liquidity portfolio
costs.
|
●
|
Impairment
losses of £435 million include a £366 million charge
reflecting a more uncertain economic outlook.
|
●
|
Net
loans to customers increased by £8.0 billion in the quarter
reflecting the utilisation of RCFs in response to Covid-19
uncertainty.
|
●
|
Customer
deposits increased by £8.9 billion in comparison to Q4 2019 as
customers sought to retain liquidity.
|
|
Quarter ended
|
|
|
As at
|
|
||||
|
31 March
|
31 December
|
31 March
|
|
|
31 March
|
31 December
|
|
|
|
2020
|
2019
|
2019
|
|
|
2020
|
2019
|
|
|
|
£m
|
£m
|
£m
|
|
|
£bn
|
£bn
|
|
|
Total income
|
201
|
195
|
193
|
|
Net loans to customers -
|
|
|
|
|
Operating expenses
|
(123)
|
(135)
|
(117)
|
|
amortised cost
|
15.8
|
15.5
|
|
|
Impairment
|
|
|
|
|
Customer deposits
|
29.0
|
28.4
|
|
|
(losses)/releases
|
(29)
|
1
|
4
|
|
RWAs
|
10.3
|
10.1
|
|
|
Operating profit
|
49
|
61
|
80
|
|
Assets Under Management
|
|
|
|
|
Return on equity
|
9.8%
|
12.0%
|
17.1%
|
|
(AUMs)
|
24.3
|
23.2
|
|
|
Net interest margin
|
2.25%
|
2.30%
|
2.52%
|
|
Assets Under Administration
|
|
|
|
|
Cost:income ratio
|
61.2%
|
69.2%
|
60.6%
|
|
(AUAs) (1)
|
2.4
|
7.2
|
|
|
|
|
|
|
|
Total Assets Under
|
|
|
|
|
|
|
|
|
|
Management and
|
|
|
|
|
|
|
|
|
|
Administration (AUMA)
|
26.7
|
30.4
|
|
|
Notes:
|
|||||||||
(1) Private Banking
manages assets under management portfolios on behalf of UK Personal
Banking and RBSI and receives a management fee in respect of
providing this service.
(2) Comparisons with
prior periods are impacted by the transfer of the Private Client
Advice business to Private Banking from 1 January 2020. The net
impact on Q1 2019 operating profit would have been to increase
total income by £11 million and operating expenses by £2
million. The net impact on the Q4 2019 balance sheet would have
been to increase AUMs by £4.6 billion and customer deposits by
£0.2 billion. Variances in the commentary below have been
adjusted for the impact of this transfer.
|
|||||||||
|
|||||||||
●
|
Private
Banking is committed to supporting clients during this period of
significant uncertainty by offering a range
of
payment holidays and access to the government supported CBILS for
clients experiencing financial distress as a result of Covid-19.
Additionally, we have introduced new digital communication channels
and improved the functionality of Coutts24 and Adam24 to ensure
client banking needs can be met remotely.
|
||||||||
●
|
Total
income was £3 million, or 1.5%, lower than Q1 2019 as lower
deposit income was partially offset by volume growth. Net interest
margin decreased by 5 basis points in comparison to Q4 2019
primarily due to lower deposit income and asset margin
compression.
|
||||||||
●
|
Impairment
losses of £29 million include a £25 million charge
reflecting a more uncertain economic outlook.
|
||||||||
●
|
Total
AUMAs overseen by Private Banking decreased by £3.7 billion,
or 12.2%, compared with Q4 2019 reflecting adverse market movements
of £4.1 billion partially offset by net new business inflows
of £0.4 billion.
|
|
Quarter ended
|
|
|
As at
|
|||
|
31 March
|
31 December
|
31 March
|
|
|
31 March
|
31 December
|
|
2020
|
2019
|
2019
|
|
|
2020
|
2019
|
|
£m
|
£m
|
£m
|
|
|
£bn
|
£bn
|
Total income
|
144
|
150
|
151
|
|
Net loans to customers -
|
|
|
Operating expenses
|
(61)
|
(83)
|
(59)
|
|
amortised cost
|
13.6
|
14.1
|
Impairment (losses)/releases
|
(15)
|
(5)
|
1
|
|
Customer deposits
|
32.3
|
30.1
|
Operating profit
|
68
|
62
|
93
|
|
RWAs
|
6.8
|
6.5
|
Return on equity
|
19.4%
|
17.3%
|
28.6%
|
|
|
|
|
Net interest margin
|
1.45%
|
1.47%
|
1.70%
|
|
|
|
|
Cost:income ratio
|
42.4%
|
55.3%
|
39.1%
|
|
|
|
|
|
|
●
|
RBS
International is committed to supporting its customers during this
period of uncertainty and is
participating
in government supported Coronavirus Business Disruption Loan
Guarantee Schemes for Local Banking customers in Jersey, Guernsey
and the Isle of Man in addition to suspending a range of fees and
charges for its personal and business customers.
|
●
|
Total
income was £7 million, or 4.6%, lower than Q1 2019 primarily
due to lower deposit funding benefits as a result of interest rate
reductions by central banks, partially offset by increased average
volumes in customer lending and deposits. Net interest margin
decreased by 2 basis points in comparison to Q4 2019
primarily due to lower deposit funding benefits.
|
●
|
Impairment
losses of £15 million include an £8 million charge
reflecting a more uncertain economic outlook.
|
●
|
Net
loans to customers decreased by £0.5 billion, or 3.5%, in
comparison to Q4 2019 as Funds sector customers repaid loans to
position for future requirements. Customer deposits increased by
£2.2 billion, or 7.3%, as Institutional Banking customers
sought to build liquidity and fund loan repayments in response to
Covid-19 uncertainty.
|
|
Quarter ended
|
|
|
As at
|
|||
|
31 March
|
31 December
|
31 March
|
|
|
31 March
|
31 December
|
|
2020
|
2019
|
2019
|
|
|
2020
|
2019
|
|
£m
|
£m
|
£m
|
|
|
£bn
|
£bn
|
Total income
|
543
|
250
|
256
|
|
Funded Assets
|
129.6
|
116.2
|
of which:
|
|
|
|
|
RWAs
|
38.9
|
37.9
|
- Core income excluding
|
|
|
|
|
|
|
|
own credit
adjustments
|
412
|
196
|
377
|
|
|
|
|
- Legacy income
|
(24)
|
76
|
(79)
|
|
|
|
|
- Own credit adjustments
|
155
|
(22)
|
(42)
|
|
|
|
|
Operating expenses
|
(342)
|
(392)
|
(334)
|
|
|
|
|
Impairment releases/(losses)
|
5
|
10
|
16
|
|
|
|
|
Operating (loss)/profit
|
206
|
(132)
|
(62)
|
|
|
|
|
Return on equity
|
8.7%
|
(6.5%)
|
(2.4%)
|
|
|
|
|
Cost:income ratio
|
63.0%
|
156.8%
|
130.5%
|
|
|
|
|
|
|
●
|
NatWest
Markets has worked closely with Commercial Banking to support 107
clients, as at 23 April 2020, to access the Bank of England’s
Covid-19 Corporate Financing Facility (CCFF), utilising our strong
specialist expertise to help manage risk through the ongoing period
of uncertainty.
|
●
|
Progress
has been made on the refocussing of NatWest Markets, including
reducing RWAs in the medium term, announced in February 2020. We
have started to simplify the product suite, including announcing
that we will no longer offer client clearing or execution services
for Exchange Traded Derivatives. Additionally we have also
identified opportunities to improve efficiencies by working across
the Bank, including building a common approach to technology.
Phasing of implementation of our plans is subject to market
conditions to ensure support continues for our
customers.
|
●
|
Total
income was £287 million higher than Q1 2019 reflecting the
impact of own credit adjustments (OCA) and higher core income. An
OCA credit of £155 million, compared with a charge of £42
million in Q1 2019, reflected the significant widening of credit
spreads across the market. Core income was £35 million, or
9.3%, higher than Q1 2019, as the impact of credit market
write-downs was more than offset by increased customer activity as
the market reacted to the spread of the Covid-19
virus.
|
●
|
RWAs
increased by £1.0 billion in comparison to Q4 2019 as the
impact of market volatility increased counterparty and market risk,
partially offset by the Prudential Regulation Authority’s
(PRA) temporary approach to Value at Risk (VAR) back-testing
exceptions.
|
|
Quarter ended
|
||
|
31 March
|
31 December
|
31 March
|
|
2020
|
2019
|
2019
|
|
£m
|
£m
|
£m
|
Central
items not allocated
|
(70)
|
939
|
(53)
|
●
|
A
£70 million operating loss within central items not allocated
primarily reflects litigation and conduct charges and other
treasury income.
|
●
|
RBS
will bring Bó, our personal digital account, together with
Mettle, the digital bank for SMEs. As a result, RBS will wind down
Bó as a customer-facing brand. The technology used in Bó
will be integrated into Mettle as it is developed.
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended 31 March 2020
|
||||||||
UK Personal
|
Ulster
|
Commercial
|
Private
|
RBS
|
NatWest
|
Central items &
|
Total
|
||
|
Banking
|
Bank RoI
|
Banking
|
Banking
|
International
|
Markets
|
other (1)
|
RBS
|
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
|
Income statement
|
|
|
|
|
|
|
|
|
|
Net
interest income
|
1,007
|
97
|
674
|
127
|
111
|
(40)
|
(34)
|
1,942
|
|
Non-interest
income
|
143
|
32
|
334
|
74
|
33
|
428
|
21
|
1,065
|
|
Own
credit adjustments
|
-
|
-
|
-
|
-
|
-
|
155
|
-
|
155
|
|
Total income
|
1,150
|
129
|
1,008
|
201
|
144
|
543
|
(13)
|
3,162
|
|
Direct
expenses
|
|
|
|
|
|
|
|
|
|
- staff
costs
|
(140)
|
(49)
|
(192)
|
(47)
|
(32)
|
(167)
|
(292)
|
(919)
|
|
- other
costs
|
(78)
|
(24)
|
(78)
|
(24)
|
(14)
|
(57)
|
(520)
|
(795)
|
|
Indirect
expenses
|
(374)
|
(45)
|
(298)
|
(47)
|
(14)
|
(74)
|
852
|
-
|
|
Strategic
costs
|
|
|
|
|
|
|
|
|
|
-
direct
|
-
|
(1)
|
(5)
|
-
|
(1)
|
(34)
|
(90)
|
(131)
|
|
-
indirect
|
(34)
|
(4)
|
(36)
|
(5)
|
(3)
|
(8)
|
90
|
-
|
|
Litigation
and conduct costs
|
97
|
-
|
(1)
|
-
|
3
|
(2)
|
(93)
|
4
|
|
Operating expenses
|
(529)
|
(123)
|
(610)
|
(123)
|
(61)
|
(342)
|
(53)
|
(1,841)
|
|
Operating
profit/(loss) before impairment (losses)/releases
|
621
|
6
|
398
|
78
|
83
|
201
|
(66)
|
1,321
|
|
Impairment
(losses)/releases
|
(297)
|
(27)
|
(435)
|
(29)
|
(15)
|
5
|
(4)
|
(802)
|
|
Operating profit/(loss)
|
324
|
(21)
|
(37)
|
49
|
68
|
206
|
(70)
|
519
|
|
Additional information
|
|
|
|
|
|
|
|
|
|
Return
on equity (2)
|
15.5%
|
(4.2%)
|
(2.5%)
|
9.8%
|
19.4%
|
8.7%
|
nm
|
3.6%
|
|
Cost:income
ratio (2)
|
46.0%
|
95.3%
|
59.1%
|
61.2%
|
42.4%
|
63.0%
|
nm
|
57.7%
|
|
Total
assets (£bn)
|
186.3
|
26.3
|
178.3
|
23.4
|
33.2
|
335.7
|
34.4
|
817.6
|
|
Funded
assets (£bn)
|
186.3
|
26.3
|
178.3
|
23.4
|
33.2
|
129.6
|
31.8
|
608.9
|
|
Net
loans to customers - amortised cost (£bn)
|
163.7
|
18.7
|
109.2
|
15.8
|
13.6
|
12.2
|
18.1
|
351.3
|
|
Loan
impairment rate (2)
|
72bps
|
56bps
|
157bps
|
nm
|
nm
|
nm
|
nm
|
90bps
|
|
Impairment
provisions (£bn)
|
(1.6)
|
(0.7)
|
(1.7)
|
(0.1)
|
-
|
(0.1)
|
-
|
(4.2)
|
|
Impairment
provisions - stage 3 (£bn)
|
(0.9)
|
(0.6)
|
(1.0)
|
-
|
-
|
(0.1)
|
-
|
(2.6)
|
|
Customer
deposits (£bn)
|
152.8
|
19.3
|
143.9
|
29.0
|
32.3
|
5.7
|
1.8
|
384.8
|
|
Risk-weighted
assets (RWAs) (£bn)
|
38.2
|
12.7
|
76.9
|
10.3
|
6.8
|
38.9
|
1.4
|
185.2
|
|
RWA
equivalent (RWAe) (£bn)
|
38.2
|
12.7
|
77.0
|
10.3
|
7.1
|
42.2
|
1.7
|
189.2
|
|
Employee
numbers (FTEs - thousands)
|
18.6
|
2.9
|
10.0
|
2.0
|
1.8
|
5.1
|
22.8
|
63.2
|
|
Average
interest earning assets (£bn)
|
177.4
|
24.9
|
148.4
|
22.7
|
30.9
|
36.1
|
nm
|
458.5
|
|
Net
interest margin
|
2.28%
|
1.56%
|
1.83%
|
2.25%
|
1.45%
|
(0.45%)
|
nm
|
1.70%
|
|
Third
party customer asset rate (3)
|
3.06%
|
2.28%
|
3.03%
|
2.77%
|
2.79%
|
nm
|
nm
|
nm
|
|
Third
party customer funding rate (3)
|
(0.37%)
|
(0.13%)
|
(0.42%)
|
(0.38%)
|
(0.11%)
|
nm
|
nm
|
nm
|
|
Quarter ended 31 December 2019
|
||||||||
|
UK Personal
|
Ulster
|
|
Commercial
|
Private
|
RBS
|
NatWest
|
Central items &
|
Total
|
|
Banking
|
Bank RoI
|
|
Banking
|
Banking
|
International
|
Markets
|
other (1)
|
RBS
|
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Income statement
|
|
|
|
|
|
|
|
|
|
Net
interest income
|
1,012
|
98
|
|
715
|
130
|
117
|
(4)
|
(31)
|
2,037
|
Non-interest
income
|
183
|
42
|
|
361
|
65
|
33
|
276
|
1,258
|
2,218
|
Own
credit adjustments
|
-
|
(1)
|
|
-
|
-
|
-
|
(22)
|
1
|
(22)
|
Total income
|
1,195
|
139
|
|
1,076
|
195
|
150
|
250
|
1,228
|
4,233
|
Direct
expenses
|
|
|
|
|
|
|
|
|
|
- staff
costs
|
(133)
|
(38)
|
|
(179)
|
(40)
|
(31)
|
(118)
|
(296)
|
(835)
|
- other
costs
|
(96)
|
(26)
|
|
(67)
|
(14)
|
(20)
|
(74)
|
(773)
|
(1,070)
|
Indirect
expenses
|
(413)
|
(46)
|
|
(331)
|
(66)
|
(27)
|
(104)
|
987
|
-
|
Strategic
costs
|
|
|
|
|
|
|
|
|
|
-
direct
|
(9)
|
(21)
|
|
(26)
|
(2)
|
(3)
|
(74)
|
(402)
|
(537)
|
-
indirect
|
(130)
|
(8)
|
|
(85)
|
(6)
|
(2)
|
(7)
|
238
|
-
|
Litigation
and conduct costs
|
(7)
|
(1)
|
|
(12)
|
(7)
|
-
|
(15)
|
(43)
|
(85)
|
Operating expenses
|
(788)
|
(140)
|
|
(700)
|
(135)
|
(83)
|
(392)
|
(289)
|
(2,527)
|
Operating
profit/(loss) before impairment (losses)/releases
|
407
|
(1)
|
|
376
|
60
|
67
|
(142)
|
939
|
1,706
|
Impairment
(losses)/releases
|
(81)
|
(4)
|
|
(81)
|
1
|
(5)
|
10
|
-
|
(160)
|
Operating profit/(loss)
|
326
|
(5)
|
|
295
|
61
|
62
|
(132)
|
939
|
1,546
|
Additional information
|
|
|
|
|
|
|
|
|
|
Return
on equity (2)
|
14.9%
|
(1.0%)
|
|
7.6%
|
12.0%
|
17.3%
|
(6.5%)
|
nm
|
17.7%
|
Cost:income
ratio (2)
|
65.9%
|
100.7%
|
|
63.9%
|
69.2%
|
55.3%
|
156.8%
|
nm
|
59.4%
|
Total
assets (£bn)
|
182.3
|
25.4
|
|
165.4
|
23.3
|
31.7
|
263.9
|
31.0
|
723.0
|
Funded
assets (£bn)
|
182.3
|
25.4
|
|
165.4
|
23.3
|
31.7
|
116.2
|
28.7
|
573.0
|
Net
loans to customers - amortised cost (£bn)
|
158.9
|
18.2
|
|
101.2
|
15.5
|
14.1
|
8.4
|
10.6
|
326.9
|
Loan
impairment rate (2)
|
20bps
|
8bps
|
|
32bps
|
nm
|
nm
|
nm
|
nm
|
19bps
|
Impairment
provisions (£bn)
|
(1.4)
|
(0.8)
|
|
(1.3)
|
-
|
-
|
(0.1)
|
(0.1)
|
(3.7)
|
Impairment
provisions - stage 3 (£bn)
|
(0.8)
|
(0.7)
|
|
(1.0)
|
-
|
-
|
(0.1)
|
(0.1)
|
(2.7)
|
Customer
deposits (£bn)
|
150.3
|
18.5
|
|
135.0
|
28.4
|
30.1
|
3.7
|
3.2
|
369.2
|
Risk-weighted
assets (RWAs) (£bn)
|
37.8
|
13.0
|
|
72.5
|
10.1
|
6.5
|
37.9
|
1.4
|
179.2
|
RWA
equivalent (RWAe) (£bn)
|
38.2
|
13.2
|
|
72.8
|
10.1
|
6.7
|
40.5
|
1.7
|
183.2
|
Employee
numbers (FTEs - thousands)
|
19.1
|
2.9
|
|
10.1
|
1.9
|
1.8
|
5.0
|
23.2
|
64.0
|
Average
interest earning assets (£bn)
|
172.9
|
24.8
|
|
146.4
|
22.4
|
31.6
|
36.6
|
nm
|
456.2
|
Net
interest margin
|
2.32%
|
1.57%
|
|
1.94%
|
2.30%
|
1.47%
|
(0.04%)
|
nm
|
1.77%
|
Third
party customer asset rate (3)
|
3.09%
|
2.23%
|
|
3.15%
|
2.86%
|
2.79%
|
nm
|
nm
|
nm
|
Third
party customer funding rate (3)
|
(0.38%)
|
(0.15%)
|
|
(0.43%)
|
(0.40%)
|
(0.09%)
|
nm
|
nm
|
nm
|
|
Quarter ended 31 March 2019
|
||||||||
|
UK Personal
|
Ulster
|
|
Commercial
|
Private
|
RBS
|
NatWest
|
Central items &
|
Total
|
|
Banking
|
Bank RoI
|
|
Banking
|
Banking
|
International
|
Markets
|
other (1)
|
RBS
|
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
Income statement
|
|
|
|
|
|
|
|
|
|
Net
interest income
|
1,052
|
98
|
|
708
|
132
|
117
|
(31)
|
(43)
|
2,033
|
Non-interest
income
|
193
|
47
|
|
374
|
61
|
34
|
329
|
9
|
1,047
|
Own
credit adjustments
|
-
|
-
|
|
-
|
-
|
-
|
(42)
|
(1)
|
(43)
|
Total income
|
1,245
|
145
|
|
1,082
|
193
|
151
|
256
|
(35)
|
3,037
|
Direct
expenses
|
|
|
|
|
|
|
|
|
|
- staff
costs
|
(149)
|
(52)
|
|
(189)
|
(41)
|
(28)
|
(173)
|
(304)
|
(936)
|
- other
costs
|
(71)
|
(26)
|
|
(75)
|
(18)
|
(13)
|
(48)
|
(551)
|
(802)
|
Indirect
expenses
|
(390)
|
(47)
|
|
(310)
|
(51)
|
(14)
|
(89)
|
901
|
-
|
Strategic
costs
|
|
|
|
|
|
|
|
|
|
-
direct
|
-
|
(5)
|
|
(20)
|
-
|
(2)
|
(18)
|
(150)
|
(195)
|
-
indirect
|
(26)
|
(5)
|
|
(36)
|
(7)
|
(2)
|
(13)
|
89
|
-
|
Litigation
and conduct costs
|
1
|
(1)
|
|
(10)
|
-
|
-
|
7
|
(2)
|
(5)
|
Operating expenses
|
(635)
|
(136)
|
|
(640)
|
(117)
|
(59)
|
(334)
|
(17)
|
(1,938)
|
Operating
profit/(loss) before impairment (losses)/releases
|
610
|
9
|
|
442
|
76
|
92
|
(78)
|
(52)
|
1,099
|
Impairment
(losses)/releases
|
(112)
|
11
|
|
(5)
|
4
|
1
|
16
|
(1)
|
(86)
|
Operating profit/(loss)
|
498
|
20
|
|
437
|
80
|
93
|
(62)
|
(53)
|
1,013
|
Additional information
|
|
|
|
|
|
|
|
|
|
Return
on equity (2)
|
24.7%
|
3.8%
|
|
11.5%
|
17.1%
|
28.6%
|
(2.4%)
|
nm
|
8.3%
|
Cost:income
ratio (2)
|
51.0%
|
93.8%
|
|
57.8%
|
60.6%
|
39.1%
|
130.5%
|
nm
|
63.4%
|
Total
assets (£bn)
|
172.2
|
24.8
|
|
165.4
|
21.7
|
28.9
|
272.8
|
33.3
|
719.1
|
Funded
assets (£bn)
|
172.2
|
24.8
|
|
165.4
|
21.7
|
28.9
|
138.8
|
33.3
|
585.1
|
Net
loans to customers - amortised cost (£bn)
|
150.6
|
18.2
|
|
100.8
|
14.4
|
13.3
|
9.1
|
-
|
306.4
|
Loan
impairment rate (2)
|
30bps
|
(23)bps
|
|
2bps
|
nm
|
nm
|
nm
|
nm
|
11bps
|
Impairment
provisions (£bn)
|
(1.3)
|
(0.9)
|
|
(1.1)
|
-
|
-
|
(0.2)
|
(0.1)
|
(3.6)
|
Impairment
provisions - stage 3 (£bn)
|
(0.7)
|
(0.8)
|
|
(0.9)
|
-
|
-
|
(0.2)
|
-
|
(2.6)
|
Customer
deposits (£bn)
|
145.7
|
17.5
|
|
131.8
|
26.9
|
27.6
|
2.7
|
3.0
|
355.2
|
Risk-weighted
assets (RWAs) (£bn)
|
35.8
|
14.2
|
|
78.1
|
9.6
|
7.0
|
44.6
|
1.5
|
190.8
|
RWA
equivalent (RWAes) (£bn)
|
36.8
|
14.2
|
|
79.9
|
9.6
|
7.1
|
49.1
|
2.0
|
198.7
|
Employee
numbers (FTEs - thousands)
|
20.4
|
3.1
|
|
10.3
|
1.9
|
1.7
|
5.0
|
24.5
|
66.9
|
Average
interest earning assets (£bn)
|
162.9
|
24.1
|
|
144.6
|
21.2
|
27.8
|
32.1
|
nm
|
435.8
|
Net
interest margin
|
2.62%
|
1.65%
|
|
1.99%
|
2.52%
|
1.70%
|
(0.39%)
|
nm
|
1.89%
|
Third
party customer asset rate (3)
|
3.31%
|
2.32%
|
|
3.22%
|
3.01%
|
2.95%
|
nm
|
nm
|
nm
|
Third
party customer funding rate (3)
|
(0.37%)
|
(0.19%)
|
|
(0.47%)
|
(0.42%)
|
(0.13%)
|
nm
|
nm
|
nm
|
|
31 December 2019
|
Q1 2020
|
31 March 2020
|
|
overlay
|
increment
|
overlay
|
|
£m
|
£m
|
£m
|
UK Personal
|
75
|
185
|
260
|
Of which:
mortgages
|
18
|
10
|
28
|
unsecured
|
57
|
175
|
232
|
Ulster Bank RoI
|
14
|
34
|
48
|
Of which:
mortgages
|
5
|
17
|
22
|
commercial
|
9
|
17
|
26
|
Commercial Banking
|
75
|
366
|
441
|
Private Banking
|
-
|
25
|
25
|
Central items & other
|
1
|
4
|
5
|
NatWest Holdings Limited Total
|
165
|
614
|
779
|
|
|
|
|
NatWest Markets
|
4
|
6
|
10
|
RBS International
|
1
|
8
|
9
|
RBS Total
|
170
|
628
|
798
|
|
31 March 2020
|
|
31 December 2019
|
||||||||
|
Loans -
|
|
|
|
|
|
Loans -
|
|
|
|
|
|
amortised
|
ECL provisions (2)
|
|
|
amortised
|
ECL provisions (2)
|
|
||||
|
cost (1)
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
cost (1)
|
Stage 1
|
Stage 2
|
Stage 3
|
Total
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
Personal
|
194,351
|
196
|
665
|
1,358
|
2,219
|
|
188,870
|
130
|
503
|
1,449
|
2,082
|
Mortgages
|
179,572
|
43
|
129
|
687
|
859
|
|
174,003
|
25
|
118
|
821
|
964
|
Credit cards
|
4,222
|
56
|
162
|
90
|
308
|
|
4,478
|
40
|
132
|
89
|
261
|
Other personal
|
10,557
|
97
|
374
|
581
|
1,052
|
|
10,389
|
65
|
253
|
539
|
857
|
Wholesale
|
173,313
|
464
|
412
|
1,254
|
2,130
|
|
151,098
|
192
|
249
|
1,269
|
1,710
|
Property
|
38,670
|
120
|
82
|
389
|
591
|
|
36,371
|
45
|
47
|
402
|
494
|
Financial institutions
|
45,428
|
16
|
6
|
6
|
28
|
|
36,266
|
16
|
4
|
8
|
28
|
Sovereign
|
9,930
|
7
|
-
|
1
|
8
|
|
7,419
|
7
|
-
|
-
|
7
|
Corporate
|
79,285
|
321
|
324
|
858
|
1,503
|
|
71,042
|
124
|
198
|
859
|
1,181
|
Of
which: Airlines and aerospace
|
2,464
|
8
|
5
|
25
|
38
|
|
1,713
|
2
|
3
|
55
|
60
|
Automotive
|
7,589
|
23
|
18
|
16
|
57
|
|
6,225
|
12
|
11
|
15
|
38
|
Health
|
5,734
|
36
|
29
|
58
|
123
|
|
5,706
|
9
|
16
|
52
|
77
|
Land
transport and logistics
|
4,400
|
23
|
26
|
31
|
80
|
|
3,846
|
6
|
12
|
21
|
39
|
Leisure
|
9,408
|
68
|
59
|
178
|
305
|
|
7,953
|
25
|
27
|
175
|
227
|
Oil and
gas
|
2,390
|
20
|
11
|
58
|
89
|
|
2,149
|
5
|
3
|
55
|
63
|
Retail
|
9,399
|
28
|
33
|
177
|
238
|
|
7,891
|
13
|
16
|
180
|
209
|
Shipping
|
1,232
|
40
|
53
|
33
|
126
|
|
1,219
|
1
|
37
|
5
|
43
|
Total
|
367,664
|
660
|
1,077
|
2,612
|
4,349
|
|
339,968
|
322
|
752
|
2,718
|
3,792
|
●
|
IFRS 9 Transition: RBS has elected to take advantage of the
transitional regulatory capital rules in respect of expected credit
losses following the adoption of IFRS 9 from 1 January 2018, it had
previously had a negligible impact up to Q4 2019. Following the
additional ECL as a result of Covid-19, the transition impact on
CET1 regulatory capital at 31 March 2020 is £296
million.
|
●
|
Market Risk Value-at-risk (VaR) multiplier: The PRA
announced a temporary approach in relation to the exceptional
levels of market volatility which has resulted in an increase in
VaR back testing exceptions. VaR multiplier increases due to new
back testing exceptions can be offset through a commensurate
reduction in the risks-not-in-VaR (RNIV) capital requirements. The
PRA will review this approach after six months.
|
●
|
Capital buffers: Many countries have recently announced
reductions in their countercyclical capital buffer rates in
response to Covid-19. Most notably for RBS, the Financial Policy
Committee reduced the UK rate from 1% to 0% effective from 11 March
2020. The CBI also announced a reduction of the Republic of Ireland
rate from 1% to 0% effective from 1 April 2020.
|
Type
|
CET1
|
Total Tier 1
|
Total capital
|
||||
Pillar
1 requirements
|
4.5%
|
6.0%
|
8.0%
|
||||
Pillar
2A requirements
|
1.9%
|
2.6%
|
3.4%
|
||||
Minimum
Capital Requirements
|
6.4%
|
8.6%
|
11.4%
|
||||
Capital
conservation buffer
|
2.5%
|
2.5%
|
2.5%
|
||||
Countercyclical
capital buffer (1)
|
0.1%
|
0.1%
|
0.1%
|
||||
G-SIB
buffer (2)
|
- |
-
|
-
|
||||
MDA
Threshold
|
9.0%
|
na
|
na
|
||||
Subtotal
(3)
|
9.0%
|
11.2%
|
14.0%
|
||||
Capital
ratios at 31 March 2020
|
16.6%
|
18.8%
|
21.4%
|
||||
Headroom
(4)
|
7.6%
|
7.6%
|
7.4%
|
||||
|
|
|
|
|
|
|
|
(1)
|
Many
countries have recently announced reductions in their
countercyclical capital buffer rates in response to Covid-19. Most
notably for RBS, the Financial Policy Committee reduced the UK rate
from 1% to 0% effective from 11 March 2020. The CBI also announced
a reduction of the Republic of Ireland rate from 1% to 0% which
will be effective from 1 April 2020. When the Republic of Ireland
rate reduction is effective - based on the current exposure profile
- it will reduce RBS’s countercyclical capital buffer to nil
and reduce the MDA threshold to 8.9%.
|
(2)
(3)
(4)
|
In
November 2018 the Financial Stability Board announced that RBS is
no longer a G-SIB. From 1 January 2020, RBS is released from this
global buffer requirement.
The
prevailing combined buffer requirements for RBS equate to the
aggregate of the capital conservation buffer and countercyclical
buffer. 9% CET1 represents MDA threshold for
RBS.
The
headroom does not reflect excess distributable capital and may vary
over time.
|
|
CRR basis (1)
|
||
|
31 March
|
31 December
|
31 March
|
Capital adequacy ratios
|
2020
|
2019
|
2019
|
CET1 (%)
|
16.6
|
16.2
|
16.2
|
Tier 1 (%)
|
18.8
|
18.5
|
18.3
|
Total (%)
|
21.4
|
21.2
|
21.1
|
MREL
– as a percentage of RWA
|
34.1
|
33.2
|
na
|
|
|
|
|
Capital
|
£m
|
£m
|
£m
|
Tangible equity
|
32,990
|
32,371
|
34,962
|
|
|
|
|
Expected loss less impairment provisions
|
-
|
(167)
|
(682)
|
Prudential valuation adjustment
|
(531)
|
(431)
|
(448)
|
Deferred tax assets
|
(722)
|
(757)
|
(720)
|
Own credit adjustments
|
(519)
|
(118)
|
(311)
|
Pension fund assets
|
(488)
|
(474)
|
(389)
|
Cash flow hedging reserve
|
(259)
|
(35)
|
49
|
Foreseeable ordinary and special dividends
|
-
|
(968)
|
(1,568)
|
Foreseeable charges
|
-
|
(365)
|
-
|
Adjustments under IFRS 9 transitional arrangements
|
296
|
-
|
-
|
Other deductions
|
-
|
(2)
|
(4)
|
Total deductions
|
(2,223)
|
(3,317)
|
(4,073)
|
|
|
|
|
CET1 capital
|
30,767
|
29,054
|
30,889
|
AT1 capital
|
4,051
|
4,051
|
4,051
|
Tier 1 capital
|
34,818
|
33,105
|
34,940
|
Tier 2 capital
|
4,883
|
4,900
|
5,242
|
|
|
|
|
Total regulatory capital
|
39,701
|
38,005
|
40,182
|
|
|
|
|
Risk-weighted assets
|
|
|
|
Credit risk
|
136,400
|
131,000
|
139,300
|
Counterparty credit risk
|
13,900
|
12,600
|
14,700
|
Market risk
|
13,000
|
13,000
|
14,200
|
Operational risk
|
21,900
|
22,600
|
22,600
|
Total RWAs
|
185,200
|
179,200
|
190,800
|
|
|
|
|
Leverage
|
|
|
|
Cash and balances at central banks
|
77,400
|
77,900
|
83,800
|
Trading assets
|
81,800
|
76,700
|
89,100
|
Derivatives
|
208,700
|
150,000
|
134,100
|
Financial assets
|
425,100
|
399,100
|
380,600
|
Other assets
|
24,600
|
19,300
|
31,500
|
Total assets
|
817,600
|
723,000
|
719,100
|
|
|
|
|
Derivatives
|
|
|
|
- netting and variation
margin
|
(221,000)
|
(157,800)
|
(143,000)
|
- potential future
exposures
|
46,300
|
43,000
|
43,100
|
Securities financing transactions gross up
|
2,500
|
2,200
|
1,900
|
Other off balance sheet items
|
39,600
|
42,500
|
48,900
|
Regulatory deductions and other adjustments
|
(8,800)
|
(9,000)
|
(3,200)
|
CRR leverage exposure
|
676,200
|
643,900
|
666,800
|
|
|
|
|
CRR leverage ratio % (2)
|
5.1
|
5.1
|
5.2
|
|
|
|
|
UK leverage exposure
|
603,100
|
570,300
|
586,700
|
UK leverage ratio % (3)
|
5.8
|
5.8
|
6.0
|
MREL
– as a percentage of leverage exposure
|
10.5
|
10.4
|
na
|
(1)
|
Based
on CRR end point including the IFRS 9 transitional adjustment of
£296 million. Excluding this adjustment, the CET1 ratio would
be 16.5%.
|
(2)
|
Presented
on CRR end point Tier 1 capital (including IFRS 9 transitional
adjustment) and leverage exposure under the CRR Delegated Act.
Excluding the IFRS 9 transitional adjustment, the leverage ratio
would be 5.1%.
|
(3)
|
Presented
on CRR end point Tier 1 capital (including IFRS 9 transitional
adjustment). The UK leverage ratio excludes central bank claims
from the leverage exposure where deposits held are denominated in
the same currency and of contractual maturity that is equal or
longer than that of the central bank claims. Excluding the IFRS 9
transitional adjustment, the UK leverage ratio would be
5.7%.
|
|
CET1
|
|
|
%
|
£m
|
At 1 January 2020
|
16.2
|
29,054
|
Attributable profit for the period
|
|
288
|
Own credit
|
|
(401)
|
Share capital and reserve movements in respect of
employee
|
|
(46)
|
share
schemes
|
|
|
Foreign exchange reserves
|
|
348
|
FVOCI reserves
|
|
(362)
|
Goodwill and intangibles deduction
|
|
3
|
Deferred tax assets
|
|
35
|
Prudential valuation adjustments
|
|
(100)
|
Expected loss less impairment
|
|
167
|
Foreseeable ordinary and special dividends
|
|
968
|
Foreseeable charges
|
|
365
|
Adjustment under IFRS 9 transitional arrangements
|
|
296
|
Other movements
|
|
152
|
At 31 March 2020
|
16.6
|
30,767
|
●
|
RBS
elected to take advantage of the transitional regulatory capital
rules in respect of expected credit losses following the adoption
of IFRS 9 from 1 January 2018, it had previously had a negligible
impact up to Q4 2019. Following the additional ECL as a result of
Covid-19, the transition impact on CET1 regulatory capital at 31
March 2020 is £296 million.
|
●
|
There
is an increase in CET1 capital of £1.7 billion, primarily due
to the release of £1.3 billion following the cancellation of
proposed dividend payment and associated pension contribution, as
announced by the Board in response to Covid-19.
|
|
|
Counterparty
|
|
|
|
|
Credit risk
|
credit risk
|
Market risk
|
Operational risk
|
Total RWAs
|
|
£bn
|
£bn
|
£bn
|
£bn
|
£bn
|
At 1 January 2020
|
131.0
|
12.6
|
13.0
|
22.6
|
179.2
|
Foreign exchange movement
|
1.3
|
0.2
|
-
|
-
|
1.5
|
Business movements
|
3.5
|
1.1
|
3.2
|
(0.7)
|
7.1
|
Risk parameter changes (1)
|
0.3
|
-
|
-
|
-
|
0.3
|
Methodology changes (2)
|
0.3
|
-
|
-
|
-
|
0.3
|
Model updates
|
-
|
-
|
(0.7)
|
-
|
(0.7)
|
Other movements (3)
|
-
|
-
|
(2.5)
|
-
|
(2.5)
|
At 31 March 2020
|
136.4
|
13.9
|
13.0
|
21.9
|
185.2
|
(1)
|
Risk
parameter changes relate to changes in credit quality metrics of
customers and counterparties (such as probability of default and
loss given default) as well as internal ratings based model changes
relating to counterparty credit risk in line with European Banking
Authority Pillar 3 Guidelines.
|
(2)
|
The new
securitisation framework has been fully implemented from 1 January
2020 and all positions have moved to the new
framework.
|
(3)
|
The
decrease in Other Movement reflects the temporary reduction
permitted by the PRA to offset the impact of multiplier increases
(included in Business Movements). The offset covers all metrics
affected by the multiplier increase, including CVAs.
|
|
|
●
|
The RWA
increase was primarily driven by credit risk with increased lending
and drawdowns, primarily within Commercial Banking. Market risk was
flat in the quarter as, despite the increased market volatility,
the PRA announced a temporary approach that the capital
requirements increase due to back-testing exceptions was allowed to
be offset through a commensurate reduction in RNIV capital
requirements.
|
|
|
UK Personal
|
Ulster
|
Commercial
|
Private
|
RBS
|
NatWest
|
Central items
|
Total
|
31 March 2020
|
Banking
|
Bank RoI
|
Banking
|
Banking
|
International
|
Markets
|
& other
|
RBS
|
|
EAD
|
On balance sheet
|
225.3
|
27.0
|
140.3
|
20.3
|
32.9
|
36.9
|
0.5
|
483.2
|
Off balance sheet
|
29.1
|
2.1
|
25.4
|
0.3
|
4.0
|
7.2
|
0.5
|
68.6
|
|
Total
|
254.4
|
29.1
|
165.7
|
20.6
|
36.9
|
44.1
|
1.0
|
551.8
|
|
|
|
|
|
|
|
|
|
|
|
RWAs
|
On balance sheet
|
27.6
|
10.5
|
56.6
|
8.8
|
4.6
|
7.2
|
1.2
|
116.5
|
Off balance sheet
|
3.0
|
1.1
|
11.5
|
0.2
|
1.2
|
2.7
|
0.2
|
19.9
|
|
Total
|
30.6
|
11.6
|
68.1
|
9.0
|
5.8
|
9.9
|
1.4
|
136.4
|
|
|
|
|
|
|
|
|
|
|
|
31 December 2019
|
|
|
|
|
|
|
|
|
|
EAD
|
On balance sheet
|
221.8
|
26.0
|
131.4
|
20.3
|
31.7
|
35.4
|
0.7
|
467.3
|
Off balance sheet
|
30.2
|
2.2
|
27.2
|
0.3
|
3.3
|
7.5
|
0.4
|
71.1
|
|
Total
|
252.0
|
28.2
|
158.6
|
20.6
|
35.0
|
42.9
|
1.1
|
538.4
|
|
|
|
|
|
|
|
|
|
|
|
RWAs
|
On balance sheet
|
27.1
|
10.8
|
50.8
|
8.7
|
4.7
|
6.4
|
1.3
|
109.8
|
Off balance sheet
|
3.1
|
1.1
|
12.5
|
0.2
|
1.0
|
3.2
|
0.1
|
21.2
|
|
Total
|
30.2
|
11.9
|
63.3
|
8.9
|
5.7
|
9.6
|
1.4
|
131.0
|
|
Liquidity value
|
||
|
31 March 2020
|
|
31 December 2019
|
|
RBS (1)
|
|
RBS (1)
|
|
£m
|
|
£m
|
Cash and balances at central banks
|
73,772
|
|
74,289
|
AAA to AA- rated governments
|
55,879
|
|
46,622
|
A+ and lower rated governments
|
1,362
|
|
1,277
|
Government guaranteed issuers, Public sector entities
and
|
|
|
|
Government sponsored entities
|
225
|
|
251
|
International Organisations and Multilateral development
banks
|
2,431
|
|
2,393
|
LCR level 1 bonds
|
59,897
|
|
50,543
|
LCR level 1 Assets
|
133,669
|
|
124,832
|
LCR level 2 Assets
|
-
|
|
-
|
Non-LCR Eligible Assets
|
82
|
|
88
|
Primary liquidity
|
133,751
|
|
124,920
|
Secondary liquidity (2)
|
67,668
|
|
74,431
|
Total liquidity value
|
201,419
|
|
199,351
|
|
|
|
|
Quarter ended
|
||
|
|
|
|
31 March
|
31 December
|
31 March
|
|
|
|
|
2020
|
2019
|
2019
|
|
|
|
|
£m
|
£m
|
£m
|
Interest receivable
|
|
|
|
2,683
|
2,901
|
2,747
|
Interest payable
|
|
|
|
(741)
|
(864)
|
(714)
|
Net interest income (1)
|
|
|
|
1,942
|
2,037
|
2,033
|
Fees and commissions receivable
|
|
|
|
748
|
789
|
905
|
Fees and commissions payable
|
|
|
|
(175)
|
(175)
|
(244)
|
Income from trading activities
|
|
|
|
592
|
138
|
224
|
Other operating income
|
|
|
|
55
|
1,444
|
119
|
Non-interest income
|
|
|
|
1,220
|
2,196
|
1,004
|
Total income
|
|
|
|
3,162
|
4,233
|
3,037
|
Staff costs
|
|
|
|
(992)
|
(990)
|
(1,011)
|
Premises and equipment
|
|
|
|
(258)
|
(436)
|
(265)
|
Other administrative expenses
|
|
|
|
(398)
|
(743)
|
(418)
|
Depreciation and amortisation
|
|
|
|
(193)
|
(323)
|
(244)
|
Impairment of other intangible assets
|
|
|
|
-
|
(35)
|
-
|
Operating expenses
|
|
|
|
(1,841)
|
(2,527)
|
(1,938)
|
Profit before impairment losses
|
|
|
|
1,321
|
1,706
|
1,099
|
Impairment losses
|
|
|
|
(802)
|
(160)
|
(86)
|
Operating profit before tax
|
|
|
|
519
|
1,546
|
1,013
|
Tax charge
|
|
|
|
(188)
|
(37)
|
(216)
|
Profit for the period
|
|
|
|
331
|
1,509
|
797
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
Ordinary shareholders
|
|
|
|
288
|
1,410
|
707
|
Preference shareholders
|
|
|
|
8
|
9
|
10
|
Paid-in equity holders
|
|
|
|
97
|
90
|
90
|
Non-controlling interests
|
|
|
|
(62)
|
-
|
(10)
|
Earnings per ordinary share
|
|
|
|
2.4p
|
11.7p
|
5.9p
|
Earnings per ordinary share - fully diluted
|
|
|
|
2.4p
|
11.6p
|
5.8p
|
|
|
|
|
Quarter ended
|
||
|
|
|
|
31 March
|
31 December
|
31 March
|
|
|
|
|
2020
|
2019
|
2019
|
|
|
|
|
£m
|
£m
|
£m
|
Profit for the period
|
|
|
|
331
|
1,509
|
797
|
Items that do not qualify for reclassification
|
|
|
|
|
|
|
Remeasurement of retirement benefit schemes
|
|
|
|
(22)
|
(46)
|
(42)
|
Profit/(loss) on fair value of credit in financial
liabilities
|
|
|
|
|
|
|
designated as at FVTPL
due to own credit risk
|
|
|
|
188
|
(74)
|
(46)
|
FVOCI financial assets
|
|
|
|
(253)
|
21
|
42
|
Tax
|
|
|
|
-
|
4
|
32
|
|
|
|
|
(87)
|
(95)
|
(14)
|
Items that do qualify for reclassification
|
|
|
|
|
|
|
FVOCI financial assets
|
|
|
|
(143)
|
(11)
|
41
|
Cash flow hedges
|
|
|
|
312
|
(394)
|
188
|
Currency translation
|
|
|
|
358
|
(1,538)
|
(350)
|
Tax
|
|
|
|
(53)
|
23
|
(40)
|
|
|
|
|
474
|
(1,920)
|
(161)
|
Other comprehensive income/(loss) after tax
|
|
|
|
387
|
(2,015)
|
(175)
|
Total comprehensive income/(loss) for the period
|
|
|
|
718
|
(506)
|
622
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
Ordinary shareholders
|
|
|
|
662
|
(580)
|
558
|
Preference shareholders
|
|
|
|
8
|
9
|
10
|
Paid-in equity holders
|
|
|
|
97
|
90
|
90
|
Non-controlling interests
|
|
|
|
(49)
|
(25)
|
(36)
|
|
|
|
|
718
|
(506)
|
622
|
|
31 March
|
31 December
|
|
2020
|
2019
|
|
£m
|
£m
|
Assets
|
|
|
Cash and balances at central banks
|
77,426
|
77,858
|
Trading assets
|
81,843
|
76,745
|
Derivatives
|
208,734
|
150,029
|
Settlement balances
|
9,840
|
4,387
|
Loans to banks - amortised cost
|
12,965
|
10,689
|
Loans to customers - amortised cost
|
351,328
|
326,947
|
Other financial assets
|
60,822
|
61,452
|
Intangible assets
|
6,619
|
6,622
|
Other assets
|
8,067
|
8,310
|
Total assets
|
817,644
|
723,039
|
|
|
|
Liabilities
|
|
|
Bank deposits
|
26,733
|
20,493
|
Customer deposits
|
384,800
|
369,247
|
Settlement balances
|
8,905
|
4,069
|
Trading liabilities
|
80,767
|
73,949
|
Derivatives
|
204,477
|
146,879
|
Other financial liabilities
|
47,870
|
45,220
|
Subordinated liabilities
|
10,898
|
9,979
|
Other liabilities
|
9,071
|
9,647
|
Total liabilities
|
773,521
|
679,483
|
|
|
|
Equity
|
|
|
Ordinary shareholders' interests
|
39,609
|
38,993
|
Other owners' interests
|
4,554
|
4,554
|
Owners’ equity
|
44,163
|
43,547
|
Non-controlling interests
|
(40)
|
9
|
Total equity
|
44,123
|
43,556
|
Total liabilities and equity
|
817,644
|
723,039
|
|
Share
|
|
|
|
|
|
|
capital and
|
|
|
|
Total
|
Non
|
|
|
|
statutory
|
Paid-in
|
Retained
|
Other
|
owners'
|
controlling
|
Total
|
|
reserves
|
equity
|
earnings
|
reserves*
|
equity
|
interests
|
equity
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
At 1 January 2020
|
13,146
|
4,058
|
13,946
|
12,397
|
43,547
|
9
|
43,556
|
Profit/(loss) attributable to ordinary shareholders
|
|
|
|
|
|
|
|
and other equity
owners
|
-
|
-
|
393
|
-
|
393
|
(62)
|
331
|
Other comprehensive income
|
|
|
|
|
|
|
|
- Realised
(losses)/gains in period
|
|
|
|
|
|
|
|
on FVOCI equity shares
|
-
|
-
|
(1)
|
1
|
-
|
-
|
-
|
- Remeasurement of
retirement
|
|
|
|
|
|
|
|
benefit schemes
|
-
|
-
|
(22)
|
-
|
(22)
|
-
|
(22)
|
- Changes in fair value
of credit in financial
|
|
|
|
|
|
|
|
liabilities at FVTPL
|
-
|
-
|
188
|
-
|
188
|
-
|
188
|
- Other amounts
recognised in equity
|
-
|
-
|
-
|
305
|
305
|
13
|
318
|
- Amount transferred
from equity to earnings
|
-
|
-
|
-
|
(108)
|
(108)
|
-
|
(108)
|
- Recycled to profit or
loss on disposal
|
|
|
|
|
|
|
-
|
of businesses
|
-
|
-
|
-
|
64
|
64
|
-
|
64
|
-
Tax
|
-
|
-
|
(1)
|
(52)
|
(53)
|
-
|
(53)
|
Preference share and paid-in equity
|
|
|
|
|
|
|
|
dividends
paid
|
-
|
-
|
(105)
|
-
|
(105)
|
-
|
(105)
|
Share-based payments
|
-
|
-
|
(61)
|
-
|
(61)
|
-
|
(61)
|
Movement in own shares held
|
15
|
-
|
-
|
-
|
15
|
-
|
15
|
At 31 March 2020
|
13,161
|
4,058
|
14,337
|
12,607
|
44,163
|
(40)
|
44,123
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31 March
|
|
|
|
|
|
|
|
|
2020
|
Total equity is attributable to:
|
|
|
|
|
£m
|
||
Ordinary shareholders
|
|
|
|
|
|
|
39,609
|
Preference shareholders
|
|
|
|
|
|
|
496
|
Paid-in equity holders
|
|
|
|
|
|
|
4,058
|
Non-controlling interests
|
|
|
|
|
|
|
(40)
|
|
|
|
|
|
|
|
44,123
|
*Other reserves consists of:
|
|
|
|
|
|
|
|
Merger reserve
|
|
|
|
|
|
|
10,881
|
FVOCI reserve
|
|
|
|
|
|
|
(224)
|
Cash flow hedging reserve
|
|
|
|
|
|
|
259
|
Foreign exchange reserve
|
|
|
|
|
|
|
1,691
|
|
|
|
|
|
|
|
12,607
|
Analyst enquiries:
|
Alexander
Holcroft, Investor Relations
|
+44 (0)
20 7672 1758
|
Media enquiries:
|
RBS
Press Office
|
+44 (0)
131 523 4205
|
|
Analyst and investor call
|
Webcast and dial in details
|
Date:
|
1 May
2020
|
www.rbs.com/results
|
Time:
|
9am UK
time
|
International:
+44 (0) 203 057 6566
|
Conference ID:
|
6789865
|
UK Free
Call: 0800 279 5995
US
Local Dial-In, New York: +1 646 741 2115
|
Measure
|
Basis of preparation
|
Additional analysis or reconciliation
|
RBS 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 I
|
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 (RWAes).
|
Table I
|
Operating expenses analysis – management view
|
The
management analysis of strategic disposals in other income and
operating expenses shows strategic costs and litigation and conduct
costs in separate lines. These amounts are included in staff,
premises and equipment and other administrative expenses in the
statutory analysis.
|
Table II
|
Cost:income ratio
|
Total
operating expenses less operating lease depreciation divided by
total income less operating lease depreciation.
|
Table III
|
Commentary – adjusted periodically for specific
items
|
RBS and
segmental business performance commentary have been adjusted
for
the
impact of specific items such as transfers, FX recycling gains,
push payments fraud costs, strategic, litigation and conduct costs
(detailed on pages 10 to 12).
|
Notable
items - page 5.
Transfers
– page 8.
Strategic,
litigation and conduct costs - pages 10 to 12.
|
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 IV
|
Measure
|
Basis of preparation
|
Additional analysis or reconciliation
|
Loan:deposit ratio
|
Net customer loans held at amortised cost divided by total customer
deposits.
|
Table V
|
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
10 to 12.
|
Funded assets
|
Total
assets less derivatives.
|
Pages
8, 10 to 12.
|
ECL loss rate
|
The
annualised loan impairment charge divided by gross customer
loans.
|
Pages
10 to 12.
|
|
|
|
|
Quarter ended or as at
|
||
|
|
|
|
31 March
|
31 December
|
31 March
|
RBS return on tangible equity
|
|
|
|
2020
|
2019
|
2019
|
Profit attributable to ordinary shareholders (£m)
|
|
|
|
288
|
1,410
|
707
|
Annualised profit attributable to ordinary shareholders
(£m)
|
|
|
|
1,152
|
5,640
|
2,828
|
|
|
|
|
|
|
|
Average total equity (£m)
|
|
|
|
44,018
|
43,860
|
46,516
|
Adjustment
for other owners equity and
intangibles (£m)
|
|
|
|
(11,911)
|
(11,952)
|
(12,581)
|
Adjusted total tangible equity (£m)
|
|
|
|
32,107
|
31,908
|
33,935
|
|
|
|
|
|
|
|
Return on tangible equity (%)
|
|
|
|
3.6%
|
17.7%
|
8.3%
|
|
UK
|
Ulster
|
|
|
|
|
|
|
Personal
|
Bank
|
|
Commercial
|
Private
|
RBS
|
NatWest
|
Quarter ended 31 March 2020
|
Banking
|
RoI
|
|
Banking
|
Banking
|
International
|
Markets
|
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)
|
Adjusted attributable profit/(loss) (£m)
|
217
|
(21)
|
|
(54)
|
31
|
54
|
136
|
Annualised adjusted attributable profit/(loss)
(£m)
|
868
|
(84)
|
|
(216)
|
124
|
216
|
544
|
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 31 December 2019
|
|
|
|
|
|
|
|
Operating profit/(loss) (£m)
|
326
|
(5)
|
|
295
|
61
|
62
|
(132)
|
Adjustment for tax (£m)
|
(91)
|
-
|
|
(83)
|
(17)
|
(9)
|
37
|
Preference share cost allocation (£m)
|
(18)
|
-
|
|
(41)
|
(4)
|
(6)
|
(14)
|
Adjusted attributable profit/(loss)(£m)
|
217
|
(5)
|
|
171
|
40
|
47
|
(109)
|
Annualised adjusted attributable profit/(loss)
(£m)
|
868
|
(20)
|
|
684
|
160
|
188
|
(436)
|
Average RWAe (£bn)
|
38.7
|
13.2
|
|
74.9
|
10.1
|
6.9
|
45.0
|
Equity factor
|
15.0%
|
15.0%
|
|
12.0%
|
13.0%
|
16.0%
|
15.0%
|
RWAe applying equity factor (£bn)
|
5.8
|
2.0
|
|
9.0
|
1.3
|
1.1
|
6.7
|
Return on equity
|
14.9%
|
(1.0%)
|
|
7.6%
|
12.0%
|
17.3%
|
(6.5%)
|
|
|
|
|
|
|
|
|
Quarter ended 31 March 2019
|
|
|
|
|
|
|
|
Operating profit/(loss) (£m)
|
498
|
20
|
|
437
|
80
|
93
|
(62)
|
Adjustment for tax (£m)
|
(139)
|
-
|
|
(122)
|
(23)
|
(13)
|
17
|
Preference share cost allocation (£m)
|
(18)
|
-
|
|
(41)
|
(4)
|
-
|
-
|
Adjusted attributable profit/(loss) (£m)
|
341
|
20
|
|
274
|
53
|
80
|
(45)
|
Annualised adjusted attributable profit/(loss)
(£m)
|
1,364
|
80
|
|
1,096
|
212
|
320
|
(180)
|
Average RWAe (£bn)
|
36.8
|
14.2
|
|
79.1
|
9.6
|
7.0
|
49.4
|
Equity factor
|
15.0%
|
15.0%
|
|
12.0%
|
13.0%
|
16.0%
|
15.0%
|
RWAe applying equity factor (£bn)
|
5.5
|
2.1
|
|
9.5
|
1.2
|
1.1
|
7.4
|
Return on equity
|
24.7%
|
3.8%
|
|
11.5%
|
17.1%
|
28.6%
|
(2.4%)
|
Statutory analysis (1,2)
|
|
|
|
|
|
|
|
|
|
Quarter ended
|
|||
|
|
|
|
31 March
|
31 December
|
31 March
|
|
|
|
|
2020
|
2019
|
2019
|
Operating expenses
|
|
|
|
£m
|
£m
|
£m
|
Staff costs
|
|
|
|
(992)
|
(990)
|
(1,011)
|
Premises and equipment
|
|
|
|
(258)
|
(436)
|
(265)
|
Other administrative expenses
|
|
|
|
(398)
|
(743)
|
(418)
|
Administrative expenses
|
|
|
|
(1,648)
|
(2,169)
|
(1,694)
|
Depreciation and amortisation
|
|
|
|
(193)
|
(323)
|
(244)
|
Impairment of other intangible assets
|
|
|
|
-
|
(35)
|
-
|
Total operating expenses
|
|
|
|
(1,841)
|
(2,527)
|
(1,938)
|
Non-statutory analysis
|
|
|
|
|
|
|
|
|
|
|
Quarter ended
|
||
|
|
|
|
31 March
|
31 December
|
31 March
|
|
|
|
|
2020
|
2019
|
2019
|
Operating expenses
|
|
|
|
£m
|
£m
|
£m
|
Staff costs
|
|
|
|
(919)
|
(835)
|
(936)
|
Premises and equipment
|
|
|
|
(245)
|
(290)
|
(248)
|
Other administrative expenses
|
|
|
|
(359)
|
(560)
|
(355)
|
Strategic costs (1)
|
|
|
|
(131)
|
(537)
|
(195)
|
Litigation and conduct costs (2)
|
|
|
|
4
|
(85)
|
(5)
|
Administrative expenses
|
|
|
|
(1,650)
|
(2,307)
|
(1,739)
|
Depreciation and amortisation
|
|
|
|
(191)
|
(204)
|
(199)
|
Impairment of other intangible assets
|
|
|
|
-
|
(16)
|
-
|
Total
|
|
|
|
(1,841)
|
(2,527)
|
(1,938)
|
|
UK
|
Ulster
|
|
|
|
|
|
Central
|
|
|
Personal
|
Bank
|
|
Commercial
|
Private
|
RBS
|
NatWest
|
items
|
Total
|
|
Banking
|
RoI
|
|
Banking
|
Banking
|
International
|
Markets
|
& other
|
RBS
|
Quarter ended
|
£m
|
£m
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
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)
|
Adjusted 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%
|
|
|
|
|
|
|
|
|
|
|
31 December 2019
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
(788)
|
(140)
|
|
(700)
|
(135)
|
(83)
|
(392)
|
(289)
|
(2,527)
|
Operating lease depreciation
|
-
|
-
|
|
35
|
-
|
-
|
-
|
-
|
35
|
Adjusted operating expenses
|
(788)
|
(140)
|
|
(665)
|
(135)
|
(83)
|
(392)
|
(289)
|
(2,492)
|
Total income
|
1,195
|
139
|
|
1,076
|
195
|
150
|
250
|
1,228
|
4,233
|
Operating lease depreciation
|
-
|
-
|
|
(35)
|
-
|
-
|
-
|
-
|
(35)
|
Adjusted total income
|
1,195
|
139
|
|
1,041
|
195
|
150
|
250
|
1,228
|
4,198
|
Cost:income ratio
|
65.9%
|
100.7%
|
|
63.9%
|
69.2%
|
55.3%
|
156.8%
|
nm
|
59.4%
|
|
|
|
|
|
|
|
|
|
|
31 March 2019
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
(635)
|
(136)
|
|
(640)
|
(117)
|
(59)
|
(334)
|
(17)
|
(1,938)
|
Operating lease depreciation
|
-
|
-
|
|
34
|
-
|
-
|
-
|
-
|
34
|
Adjusted operating expenses
|
(635)
|
(136)
|
|
(606)
|
(117)
|
(59)
|
(334)
|
(17)
|
(1,904)
|
Total income
|
1,245
|
145
|
|
1,082
|
193
|
151
|
256
|
(35)
|
3,037
|
Operating lease depreciation
|
-
|
-
|
|
(34)
|
-
|
-
|
-
|
-
|
(34)
|
Adjusted total income
|
1,245
|
145
|
|
1,048
|
193
|
151
|
256
|
(35)
|
3,003
|
Cost:income ratio
|
51.0%
|
93.8%
|
|
57.8%
|
60.6%
|
39.1%
|
130.5%
|
nm
|
63.4%
|
|
|
|
Quarter ended or as at
|
|||
|
|
|
|
31 March
|
31 December
|
31 March
|
|
|
|
|
2020
|
2019
|
2019
|
|
|
|
|
£m
|
£m
|
£m
|
RBS net interest income
|
|
|
|
1,942
|
2,037
|
2,033
|
NWM net interest income
|
|
|
|
40
|
4
|
31
|
Net interest income excluding NWM
|
|
|
|
1,982
|
2,041
|
2,064
|
Annualised net interest income
|
|
|
|
7,811
|
8,082
|
8,245
|
Annualised net interest income excluding NWM
|
|
|
|
7,972
|
8,097
|
8,371
|
Average interest earning assets (IEA)
|
|
|
|
458,514
|
456,164
|
435,768
|
NWM average IEA
|
|
|
|
36,113
|
36,594
|
32,072
|
Bank average IEA excluding NWM
|
|
|
|
422,401
|
419,570
|
403,696
|
|
|
|
|
|
|
|
Net interest margin
|
|
|
|
1.70%
|
1.77%
|
1.89%
|
Bank net interest margin (RBS NIM excluding NWM)
|
|
|
|
1.89%
|
1.93%
|
2.07%
|
|
As at
|
|
|
31 March
|
31 December
|
|
2020
|
2019
|
|
£bn
|
£bn
|
Loans to customers - amortised cost
|
351.3
|
326.9
|
Customer deposits
|
384.8
|
369.2
|
Loan:deposit ratio (%)
|
91%
|
89%
|
|
THE
ROYAL BANK OF SCOTLAND GROUP plc (Registrant)
|
|
|
|
By: /s/
Jan Cargill
|
|
|
|
Name:
Jan Cargill
|
|
Title:
Deputy Secretary
|