RBS 2011 Annual Report Download - page 394

392 RBS Group 2011
27 Share capital continued
The dividend access share entitles the holder to dividends equal to the
greater of 7% of the aggregate issue price of B shares issued to HM
Treasury and 250% of the ordinary dividend rate multiplied by the number
of B shares issued, less any dividends paid on the B shares and on
ordinary shares issued on conversion. Dividends on the dividend access
share are discretionary unless a dividend has been paid on the ordinary
shares, in which case dividends became mandatory. The dividend access
share does not generally carry voting rights at general meetings of
ordinary shareholders and is not convertible into ordinary shares.
The contingent capital commitment agreement can be terminated in
whole or in part by the company, with the FSA's consent, at any time. It
expires at the end of five years or, if earlier, on its termination in full.
Preference shares
Under IFRS certain of the Group's preference shares are classified as
debt and are included in subordinated liabilities on the balance sheet.
Other securities
Certain of the Group's subordinated securities in the legal form of debt
are classified as equity under IFRS.
These securities entitle the holders to interest which may be deferred at
the sole discretion of the company. Repayment of the securities is at the
sole discretion of the company on giving between 30 and 60 days notice.
Non-cumulative preference shares
Non-cumulative preference shares entitle the holders thereof (subject to
the terms of issue) to receive periodic non-cumulative cash dividends at
specified fixed rates for each Series payable out of distributable profits of
the company.
The non-cumulative preference shares are redeemable at the option of
the company, in whole or in part from time to time at the rates detailed
below plus dividends otherwise payable for the then current dividend
period accrued to the date of redemption.
Class of preference share Number of shares in
issue
Interest
rate
Redemption
date on or afte
r
Redemption
price per share Debt/equity (1)
Non-cumulative preference shares of US$0.01
Series F 6.3 million 7.65% 31 March 2007 US$25 Debt
Series H 9.7 million 7.25% 31 March 2004 US$25 Debt
Series L 30.0 million 5.75% 30 September 2009 US$25 Debt
Series M 23.1 million 6.4% 30 September 2009 US$25 Equity
Series N 22.1 million 6.35% 30 June 2010 US$25 Equity
Series P 9.9 million 6.25% 31 December 2010 US$25 Equity
Series Q 20.6 million 6.75% 30 June 2011 US$25 Equity
Series R 10.2 million 6.125% 30 December 2011 US$25 Equity
Series S 26.4 million 6.6% 30 June 2012 US$25 Equity
Series T 51.2 million 7.25% 31 December 2012 US$25 Equity
Series U 10,130 7.64% 29 September 2017 US$100,000 Equity
Non-cumulative convertible preference shares of US$0.01
Series 1 64,772 9.118% 31 March 2010 US$1,000 Debt
Non-cumulative preference shares of €0.01
Series 1 1.25 million 5.5% 31 December 2009 €1,000 Equity
Series 2 784,989 5.25% 30 June 2010 €1,000 Equity
Series 3 9,429 7.0916% 29 September 2017 €50,000 Equity
Non-cumulative convertible preference shares of £0.01
Series 1 14,866 7.387% 31 December 2010 £1,000 Debt
Non-cumulative preference shares of £1
Series 1 54,442 8.162% 5 October 2012 £1,000 Equity
Note:
(1) Those preference shares where the Group has an obligation to pay dividends are classified as debt; those where distributions are discretionary are classified as equity. The conversion rights
attaching to the convertible preference shares may result in the Group delivering a variable number of equity shares to preference shareholders; these convertible preference shares are treated as
debt.
In the event that the non-cumulative convertible preference shares are not redeemed on or before the redemption date, the holder may convert them
into ordinary shares in the company at the prevailing market price.
Under existing arrangements, no redemption or purchase of any non-cumulative preference shares may be made by the company without the prior
consent of the UK Financial Services Authority.
Notes on the consolidated accounts continued