RBS 2009 Annual Report Download - page 330

RBS Group Annual Report and Accounts 2009328
Notes on the accounts continued
28 Reserves
On 1 January 2007, the merger reserve comprised the premium on
shares issued to acquire NatWest less goodwill amortisation charged
under previous GAAP. No share premium was recorded in the company
financial statements through the operation of the merger relief
provisions of the Companies Act 1985.
UK law prescribes that only the reserves of the company are taken into
account for the purpose of making distributions and in determining the
permissible applications of the share premium account.
The Group optimises capital efficiency by maintaining reserves in
subsidiaries, including regulated entities. Certain preference shares and
subordinated debt are also included within regulatory capital. The
remittance of reserves to the company or the redemption of shares or
subordinated capital by regulated entities may be subject to maintaining
the capital resources required by the relevant regulator.
Paid-in equity represents notes issued under the company’s euro
medium term note programme with par value of US$1,600 million and
CAD600 million that are classified as equity under IFRS. The notes
attract coupons of 6.99% and 6.666% respectively until October 2017
when they change to 2.67% above the London interbank offered rate for
3-month US dollar deposits and 2.76% above the Canadian dollar
offered rate respectively. US$1,036 million of this capital was redeemed
in April 2009.
Under the arrangements for the placing and open offer in December
2008, the company issued shares in exchange for shares in Encuentro
Limited. No share premium was recorded in the company financial
statements through the operation of the merger relief provisions of the
Companies Act 2006. The subsequent redemption of these shares gave
rise to distributable profits of £14,273 million which have been
transferred from merger reserve to retained earnings.
Under the arrangements for accession to APS in December 2009, the
company issued B shares in exchange for shares in Aonach Mor
Limited. No share premium was recorded in the company financial
statements through the operation of the merger relief provisions of the
Companies Act 2006. The subsequent redemption of some of these
shares gave rise to distributable profits of £9,950 million which have
been transferred from merger reserve to retained earnings.
At 31 December 2009, 138,695,912 (2008 – 61,165,254) ordinary
shares of 25p each of the company were held by Employee Share
Trusts in respect of share awards and options granted to employees.
29 Leases
Minimum amounts receivable under non-cancellable leases:
Group
Operating
lease
Finance lease contracts Hire purchase agreements assets:
future
Unearned Unearned minimum
Gross finance Other Present Gross finance Other Present lease
amount income movements value amount income movements value rentals
Year in which receipt will occur: £m £m £m £m £m £m £m £m £m
2009
Receivable:
Within 1 year 1,507 (470) (23) 1,014 2,110 (64) (7) 2,039 781
After 1 year but within 5 years 5,496 (1,790) (131) 3,575 3,086 (100) (81) 2,905 2,514
After 5 years 10,942 (2,455) (313) 8,174 309 (6) (21) 282 1,018
Total 17,945 (4,715) (467) 12,763 5,505 (170) (109) 5,226 4,313
2008
Receivable:
Within 1 year 1,485 (613) (24) 848 2,298 (171) — 2,127 918
After 1 year but within 5 years 6,112 (2,004) (128) 3,980 3,731 (284) (34) 3,413 2,479
After 5 years 12,567 (3,094) (341) 9,132 395 (30) (44) 321 1,141
Total 20,164 (5,711) (493) 13,960 6,424 (485) (78) 5,861 4,538
2007
Receivable:
Within 1 year 1,297 (390) (23) 884 2,028 (153) — 1,875 1,073
After 1 year but within 5 years 4,968 (1,766) (144) 3,058 3,442 (300) (25) 3,117 3,046
After 5 years 11,648 (3,187) (288) 8,173 281 (7) (29) 245 1,473
Total 17,913 (5,343) (455) 12,115 5,751 (460) (54) 5,237 5,592