RBS 2005 Annual Report Download - page 180

178
Notes on the accounts
Notes on the accounts continued
Ordinary shares
The following issues of ordinary shares were made during the
year ended 31 December 2005:
(a) 13.5 million ordinary shares following the exercise of
options under the company’s executive, sharesave and
option 2000 schemes and a further 0.7 million ordinary
shares in respect of the exercise of options under the
NatWest executive and sharesave schemes which had
been exchanged for options over the company’s shares
following the acquisition of NatWest in 2000;
(b) 7.4 million ordinary shares in lieu of cash in respect of the
final dividend for the year ended 31 December 2004 and
the interim dividend for the year ended 31 December
2005; and
(c) 2.3 million ordinary shares under the company’s employee
share ownership plan.
Consideration of £163 million was received on the issue of
ordinary shares for cash and dividends of £124 million were
satisfied by the issue of shares.
During the year to 31 December 2005, options were granted
over 17.3 million ordinary shares under the company’s
executive, sharesave and option 2000 schemes. At 31
December 2005, options granted under the company’s various
schemes, exercisable up to 2015 at prices ranging from 496p to
1841p per share, were outstanding in respect of 70.8 million
ordinary shares.
In addition, options granted under the NatWest schemes were
outstanding in respect of 0.8 million ordinary shares exercisable
up to 2009 at prices ranging from 403p to 924p per share.
Preference shares
In March 2005, the company redeemed 750,000 Series 1 non-
cumulative convertible preference shares of 0.01 each at
1,000 per share and 500,000 Series 2 non-cumulative
convertible preference shares of US$0.01 each at US1,000
per share.
In May 2005, the company issued 40 million Series N non-
cumulative preference shares of US$0.01 each at US$25 per
share, the net proceeds being US$969 million.
In June 2005, the company issued 1.25 million Series 2 non-
cumulative preference shares of 0.01 each at 1,000 per
share, the net proceeds being 1,226 million.
In November 2005, the company issued 22 million Series P
non-cumulative preference shares of US$0.01 each at US$25
per share, the net proceeds being US$533 million and
redeemed 9 million Series J non-cumulative preference shares
of US$0.01 each at US$25 per share.
In December 2005, the company redeemed 400,000 Series 3
non-cumulative convertible preference shares of US$0.01 each
at US$1,000 per share.
The costs of issue and discounts allowed on preference
shares issued during the year were £42 million.
Under IFRS, certain of the Group's preference shares are classified as debt and are now included in subordinated liabilities on the
balance sheet. The following table shows the re-classification of the Group’s non-equity shares at 31 December 2004 in to equity shares
and subordinated liabilities (see Note 28) upon implementation of IAS 32 on 1 January 2005. All preference share capital redeemed
during the year was classified as debt and all capital issued during the year is classified as equity in accordance with IAS 32.
31 December 2004 1 January 2005
Adjustment to
Non-equity historic cost Equity Debt
Share capital and share premium £m £m £m £m
Non-cumulative preference shares of US$0.01 1,951 35 499 1,487
Non-cumulative convertible preference shares of US$0.01 978 — — 978
Non-cumulative preference shares of 0.01 864 (4) 860 —
Non-cumulative convertible preference shares of 0.01 529 — — 529
Non-cumulative convertible preference shares of £0.01 197 — — 197
Cumulative preference shares of £1 1—— 1
4,520 31 1,359 3,192
30 Share capital (continued)