RBS 2010 Annual Report Download - page 336

RBS Group 2010334
Notes on the accounts continued
18 Investments in Group undertakings
Investments in Group undertakings are carried at cost less impairment. Movements during the year were as follows:
Company
2010 2009 2008
£m £m £m
At 1 January 64,766 42,196 43,542
Currency translation and other adjustments (49) (566) 2,839
Additional investments in Group undertakings 1,884 36,202 10,323
Additions —— 26
Redemption of investments in Group undertakings (12,346) (7,908) —
Disposals (6) (19) (213)
Impairment of investments (5,124) (5,139) (14,321)
At 31 December 49,125 64,766 42,196
The principal subsidiary undertakings of the company are shown below.
Their capital consists of ordinary and preference shares which are
unlisted with the exception of certain preference shares issued by
NatWest and RBS Holdings N.V.
The Royal Bank of Scotland plc, RBS Insurance Group Limited and RFS
Holdings B.V. are directly owned by the company, and all of the other
subsidiary undertakings are owned directly, or indirectly through
intermediate holding companies, by these companies. All of these
subsidiaries are included in the Group's consolidated financial statements
and have an accounting reference date of 31 December.
Nature of business
Country of incorporation and
principal area of operation Group interest
The Royal Bank of Scotland plc Banking Great Britain 100%
National Westminster Bank Plc (1) Banking Great Britain 100%
Citizens Financial Group, Inc. Banking US 100%
Coutts & Company (2) Private banking Great Britain 100%
RBS Securities Inc. Broker deale
r
US 100%
RBS Insurance Group Limited Insurance Great Britain 100%
Ulster Bank Limited (3) Banking Northern Ireland 100%
RBS Holdings N.V. (4) Banking The Netherlands 98%
Notes:
(1) The company does not hold any of the NatWest preference shares in issue.
(2) Coutts & Company is incorporated with unlimited liability. Its registered office is 440 Strand, London WC2R 0QS.
(3) Ulster Bank Limited and its subsidiaries also operate in the Republic of Ireland.
(4) RFS Holdings B.V. (RFS) owns 100% of the outstanding shares of RBS Holdings N.V. (ABN AMRO Holding N.V. prior to 1 April 2010). Until 31 December 2010, the company owned 38% of RFS;
the balance of shares were held by the State of the Netherlands, successor to Fortis N.V., Fortis SA/NV, and Banco Santander S.A. (the consortium members). Although the company did not control
amajority of the voting rights in RFS, through the terms of the Consortium and Shareholders' Agreement and RFS's Articles of Association, it controlled the board of RFS and RFS is a subsidiary of
the company. RFS Holdings has substantially completed the separation of the business units of ABN AMRO Holding N.V. As part of this reorganisation, on 6 February 2010, the businesses of ABN
AMRO Holding N.V. acquired by the Dutch State were legally demerged from the ABN AMRO Holding N.V. businesses acquired by the Group and were transferred into a newly established holding
company, ABN AMRO Bank N.V. (save for certain assets and liabilities acquired by the Dutch State that were not part of the legal separation and which will be transferred to the Dutch State as soon
as possible). Legal separation of ABN AMRO Bank N.V. occurred on 1 April 2010, with the shares in that entity being transferred by RBS Holdings N.V. to a holding company called ABN AMRO
Group N.V., which is owned by the Dutch State. Following legal separation, RBS Holdings N.V. has one direct subsidiary, The Royal Bank of Scotland N.V. (RBS N.V.), a fully operational bank within
the Group. RBS N.V. is independently rated and regulated by the Dutch Central Bank. On 31 December 2010, the shareholdings of RFS were amended such that approximately 98% of its issued
share capital is now held by the company with the remainder owned by the State of the Netherlands and Banco Santander S.A. Certain assets within RBS N.V. continue to be shared by the
Consortium Members. On the division of an entity by demerger, Dutch law establishes a cross liability between surviving entities in respect of the creditors at the time of the demerger. RBS N.V.’s
cross liability is limited by law to the lower of its equity and the debts of ABN AMRO Bank N.V. on 1 April 2010. The likelihood of any cross liability crystallising is considered remote.
The above information is provided in relation to the principal related undertakings as permitted by Section 410(2) of the Companies Act 2006. Full
information on all related undertakings is included in the Annual Return delivered to the Registrar of Companies for Scotland.