RBS 2006 Annual Report Download - page 77
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Please find page 77 of the 2006 RBS annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.RBS Group • Annual Report and Accounts 2006
76
Operating and financial review continued
Operating and financial review
Overview of consolidated balance sheet
Total assets of £871.4 billion at 31 December 2006 were
up £94.6 billion, 12%, compared with 31 December 2005,
reflecting business growth.
Treasury and other eligible bills remained stable at £5.5 billion.
Loans and advances to banks increased by £12.0 billion, 17%,
to £82.6 billion. Reverse repurchase agreements and stock
borrowing (“reverse repos”) increased by £12.3 billion, 30% to
£54.2 billion, offset by a reduction in bank placings of £0.3
billion, 1% to £28.4 billion.
Loans and advances to customers were up £49.7 billion, 12%,
to £466.9 billion. Within this, reverse repos increased by 29%,
£14.0 billion to £62.9 billion. Excluding reverse repos, lending
rose by £35.7 billion, 10%, to £404.0 billion reflecting organic
growth across all divisions.
Debt securities increased by £6.3 billion, 5%, to £127.3 billion,
principally due to increased trading book holdings in
Corporate Markets.
Equity shares rose by £4.2 billion, 45%, to £13.5 billion,
reflecting the increase in the fair value of available-for-sale
securities, principally the investment in Bank of China.
Intangible assets decreased by £1.0 billion, 5%, to
£18.9 billion, principally due to exchange rate movements.
Property, plant and equipment were up £0.4 billion, 2%, to
£18.4 billion, mainly due to growth in investment properties
and operating lease assets.
Settlement balances rose £1.4 billion, 24%, to £7.4 billion as
a result of increased customer activity.
Derivatives, assets and liabilities, increased reflecting growth in
trading volumes and the effects of interest and exchange rates.
Prepayments, accrued income and other assets were down
£0.7 billion, 8%, to £8.1 billion.
Deposits by banks rose by £21.7 billion, 20%, to £132.1 billion
to fund business growth. Increased repurchase agreements
and stock lending (“repos”), up £28.5 billion, 59%, to £76.4
billion were partially offset by lower inter-bank deposits, down
£6.8 billion, 11%, at £55.7 billion.
Customer accounts were up £41.4 billion, 12%, at £384.2 billion.
Within this, repos increased £15.3 billion, 31%, to £64.0 billion.
Excluding repos, deposits rose by £26.1 billion, 9%, to
£320.2 billion with good growth in all divisions.
Debt securities in issue decreased by £4.5 billion, 5%, to
£86.0 billion.
The increase in settlement balances and short positions,
up £5.5 billion, 12%, to £49.5 billion, reflected growth in
customer activity.
Accruals, deferred income and other liabilities increased
£1.4 billion, 10%, to £15.7 billion.
Subordinated liabilities were down £0.6 billion, 2%, to £27.7
billion. The issue of £2.3 billion dated and £0.7 billion undated
loan capital was offset by the redemption of £0.3 billion dated
loan capital, £0.7 billion undated loan capital and £0.3 billion
non-cumulative preference shares and the effect of exchange
rates, £1.7 billion and other movements, £0.6 billion.
Deferred taxation liabilities rose by £1.6 billion to £3.3 billion
largely reflecting the provision for tax on the uplift in the value
of available-for-sale equity shares.
Equity minority interests increased by £3.2 billion to £5.3
billion. Of the increase, £2.1 billion related to the uplift in the
value of the investment in Bank of China attributable to minority
shareholders. The remaining increase primarily arose from the
issue of £400 million trust preferred securities and a
restructuring of the life assurance joint venture with Aviva,
following the repayment of an existing loan replaced by an
equity investment. This restructuring has no effect on the
Group’s regulatory capital position.
Shareholders’ equity increased by £4.8 billion, 14%, to
£40.2 billion. The profit for the year of £6.4 billion, issue of
£0.7 billion non-cumulative fixed rate equity preference shares
and £0.1 billion of ordinary shares in respect of the exercise of
share options, £1.6 billion increase in available-for-sale reserves,
mainly reflecting the Group’s share in the investment in Bank of
China and a £1.3 billion net decrease after tax in the Group’s
pension liability, were partly offset by the payment of the 2005
final ordinary dividend and the 2006 interim dividend, £2.5
billion and preference dividends of £0.2 billion, together with
£1.0 billion ordinary share buybacks and £1.6 billion resulting
from the effect of exchange rates and other movements.