RBS 2010 Annual Report Download - page 55

Description of business
Introduction
The Royal Bank of Scotland Group plc is the holding company of a large
global banking and financial services group. Headquartered in Edinburgh,
the Group operates in the United Kingdom, the United States and
internationally through its two principal subsidiaries, the Royal Bank and
NatWest. Both the Royal Bank and NatWest are major UK clearing banks
whose origins go back over 275 years. In the United States, the Group's
subsidiary Citizens is a large commercial banking organisation. Globally,
the Group has a diversified customer base and provides a wide range of
products and services to personal, commercial and large corporate and
institutional customers in over 50 countries.
Following placing and open offers in December 2008 and in April 2009,
HM Treasury owned approximately 70.3% of the enlarged ordinary share
capital of the company. In December 2009, the company issued a further
£25.5 billion of new capital to HM Treasury. This new capital took the
form of B shares, which do not generally carry voting rights at general
meetings of ordinary shareholders but are convertible into ordinary
shares and qualify as core tier one capital. Following the issuance of the
Bshares, HM Treasury's holding of ordinary shares of the company
remained at 70.3% although its economic interest rose to 84.4%.
During the year, the company converted non-cumulative convertible
preference shares into ordinary shares in the company. As a result, HM
Treasury’s holding in the company’s ordinary shares reduced to 67.8%
and its economic interest reduced to 82.8%.
The Group had total assets of £1,453.6 billion and owners' equity of
£75.1 billion at 31 December 2010. The Group's capital ratios, were a
Total capital ratio of 14.0 per cent, a Core Tier 1 capital ratio of 10.7 per
cent and a Tier 1 capital ratio of 12.9 per cent, at 31 December 2010.
Organisational structure and business overview
The Group’s activities are organised on a divisional basis as follows:
UK Retail offers a comprehensive range of banking products and related
financial services to the personal market. It serves customers through the
RBS and NatWest networks of branches and ATMs in the United
Kingdom, and also through telephone and internet channels. UK Retail
launched the Retail Customer Charter in June 2010 and progress against
the commitments made will be formally reported in March 2011.
UK Corporate is a leading provider of banking, finance, and risk
management services to the corporate and SME sector in the United
Kingdom. It offers a full range of banking products and related financial
services through a nationwide network of relationship managers, and also
through telephone and internet channels. The product range includes
asset finance through the Lombard brand.
Wealth provides private banking and investment services in the UK
through Coutts & Co and Adam & Company, offshore banking through
RBS International, NatWest Offshore and Isle of Man Bank, and
international private banking through RBS Coutts.
Global Transaction Services (GTS) ranks among the top five global
transaction services providers, offering global payments, cash and
liquidity management, and trade finance and commercial card products
and services. It includes the Group's corporate money transmission
activities in the United Kingdom and the United States.
Ulster Bank is the leading retail and business bank in Northern Ireland
and the third largest banking group on the island of Ireland. It provides a
comprehensive range of financial services. The Retail Markets division
which has a network of 236 branches, operates in the personal and
financial planning sectors. The Corporate Markets division provides
services to SME business customers, corporates and institutional
markets.
US Retail & Commercial provides financial services primarily through the
Citizens and Charter One brands. US Retail & Commercial is engaged in
retail and corporate banking activities through its branch network in 12
states in the United States and through non-branch offices in other
states.
The divisions discussed above are collectively referred to as Retail &
Commercial.
Global Banking & Markets (GBM) is a leading banking partner to major
corporations and financial institutions around the world, providing an
extensive range of debt and equity financing, risk management and
investment services to its customers. The division is organised along six
principal business lines: money markets; rates flow trading; currencies
and commodities; equities; credit and mortgage markets and portfolio
management & origination.
RBS Insurance provides a wide range of general insurance products to
consumers through a number of well known brands including; Direct Line,
Churchill and Privilege. It also provides insurance services for third party
brands through its UKI Partnerships division. In the commercial sector, its
NIG and Direct Line for Business operations provide insurance products
for businesses via brokers or direct respectively. Through its international
division, RBS Insurance sells general insurance, mainly motor, in
Germany and Italy. In addition to insurance services, RBS Insurance
continues to provide support and reassurance to millions of UK motorists
through its Green Flag breakdown recovery service and Tracker stolen
vehicle recovery and telematics business.
53RBS Group 2010
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