RBS 2009 Annual Report Download - page 34

RBS Group Annual Report and Accounts 200932
Ulster Bank
Cormac McCarthy,
Chief Executive,
Ulster Bank
2009 was a year of further significant
challenges for the economies of Northern
Ireland and the Republic of Ireland, as well as
for the banking industry across the island.
In response to these difficult operating conditions,
Ulster Bank took decisive and timely action.
At the beginning of the year, we announced a
programme of initiatives designed to position
the business to meet the challenges of our
markets, enabling us to continue to serve the
needs of our customers and to strengthen our
business and its all-Ireland reach.
An important element of that programme was the merging of the
First Active and Ulster Bank businesses in the Republic of Ireland.
The programme, which was completed in February 2010, saw the
integration of the First Active branch network and operations with that
of Ulster Bank and the transfer of all First Active customers to Ulster
Bank. As a result of the merger programme, Ulster Bank’s presence
throughout Ireland is now 238 branches (146 in the Republic of Ireland,
92 in Northern Ireland) and we now serve our 1.9 million customers
under one brand across the island.
In addition, we also improved efficiency across all areas of our businesses
through the implementation of a number of cost management initiatives.
We announced a voluntary redundancy programme in January, which
was oversubscribed and under which around 700 people left the
organisation with a further 300 or so due to leave in early 2010.
From the beginning of 2009 we prioritised the introduction of a number
of initiatives designed to support our customers during these difficult
times. The “Flex” initiative is a financial review designed to help those
who are having trouble in meeting their full monthly debt repayments
because of a change in their financial circumstances. We have provided
specialist training to our staff which enables them to take our customers
Ulster Bank is a leading retail and commercial
bank in Northern Ireland and the Republic
of Ireland. It provides a comprehensive range
of financial services through both its Retail
Markets division which has a network of
branches and operates in the personal and
bancassurance sectors, and its Corporate
Markets division which provides services
to business customers, corporates and
institutional markets.
2009 2008
£m £m
Net interest income 780 773
Non-interest income 254 266
Total income 1,034 1,039
Expenses (753) (715)
Operating profit before impairment losses 281 324
Impairment losses (649) (106)
Operating/(loss) profit (368) 218
Risk-weighted assets (£bn) 29.9 24.5
Return on equity (13.3%) 10.1%
Net interest margin 1.87% 1.89%
Cost:income ratio 72.8% 68.8%
Loan:deposit ratio 177% 179%
>54,000
retail customers acquired during the year
1.25 billion
in business deposits taken during the year
Target Return on equity (%) Cost:income (%) Loan:deposit (%)
2011 >0 <75 <175
2013 >15 c.50 <150