RBS 2009 Annual Report Download - page 31

29RBS Group Annual Report and Accounts 2009
Divisional review
Global Banking & Markets
Did you know?
5 and 6
RBS participated in the five
largest equity issues worldwide
and six of the ten largest debt
capital market issues
Throughout the year, our Sales teams built strong relationships with
global clients, providing views on the market and working in partnership
with researchers, strategists, structurers and traders to meet clients’
investment and risk-management objectives.
We have compelling strengths in the markets in which we choose to
compete and it is rewarding when others recognise that, too. IFR named
us “Sterling Bond House”, The Banker magazine gave us the award as
“Most Innovative in Loans & Leveraged Finance 2009” and Euromoney
named us “Best Structured Products House”.
As well as serving customers, we had to deal with the problems of the
past and make sure we are in the best shape to compete in future. Our
balance sheet needed to be reduced and we carried too many Risk
Weighted Assets. We had to tackle those issues as a matter of urgency
and we did, making good progress. We improved our liquidity profile in
the early part of the year, leaving us less susceptible to extreme
fluctuations in the wholesale money markets.
During the year, we launched a major, two-year global investment
programme. This will improve the quality and efficiency of the control
environment, help us to meet revenue targets and optimise how we use
our technology. The programme will establish class-leading front-to-back
systems to improve the management of client transactions and process
infrastructure that will support business growth in the coming years.
It will also enhance GBM’s capability to respond to increasingly
sophisticated regulatory requirements worldwide. We made progress in
the initial phases and the programme is on track to deliver its objectives.
Risk and how we manage our exposures came under scrutiny after the
events of 2008. We responded with a more thoughtful approach to risk
management, putting new systems and processes in place. This
included the successful design and implementation of enhancements to
the business’s first line of defence, which incorporates The Risk and
Control Committees, the Front Office Supervisory Policy and
Counterparty Exposure Management. Becoming best in class in
managing risk is an important feature of our investment programme.
Our Risk function was also instrumental in the creation of a culture for
self-identification and the raising of risk issues throughout the division.
As part of the Group’s Strategic Plan, our Support team focused on the
implementation of the common, cross-divisional operating model for
Support in Europe and the Middle East, as well as major property and
staff moves with the Stamford office in the US and our Bankside building
in London opening for business in 2009.
As part of the agreement we reached with the European Commission we
are selling our stake in RBS Sempra Commodities (RBSSC), a joint venture
with a US energy company. In February 2010, we announced the sale of
RBSSC’s Metals, Oils and European Energy business lines to J.P. Morgan.
Discussions continue with our joint venture partner Sempra Energy on a
range of ownership alternatives for the remainder of the business.
We would not have been able to meet the challenges we have faced
during 2009, without our people.
The GBM People Programme developed in 2009, underpins our
objective to be the partner of choice for our clients by having the right
values and behaviours embedded in our organisation. It aligns employee
objectives with business priorities and focuses on attracting and retaining
the right people with the right skills, in the right places, motivated,
engaged and performing. We have clearly set out our vision and values
for the future.
Following the acquisition of ABN AMRO’s wholesale banking
businesses, good progress has been made in integrating performance
and development across the division. We have enhanced the input into
performance assessments from our Risk function and have further
strengthened assessment practices for senior business leaders.
In 2009, we demonstrated that we can compete at the highest level in
our core franchises and provide value added services to our clients
around the world. We have a clear, client-focused strategy in place and
we intend to maintain this momentum, execute the plan and enable The
RBS Group to return to self-sufficiency.