RBS 2011 Annual Report Download - page 421

RBS Group 2011 419
Bank of England facilities
The Group also participates in a number of schemes operated by the
Bank of England available to eligible banks and building societies.
xOpen market operations - these provide market participants with
funding at market rates on a tender basis in the form of short and
long-term repos on a wide range of collateral and outright purchases
of high-quality bonds to enable them to meet the reserves that they
must hold at the Bank of England.
xThe special liquidity scheme - this was launched in April 2008 to
allow financial institutions to swap temporarily illiquid assets for
treasury bills, with fees charged based on the spread between 3-
month LIBOR and the 3-month gilt repo rate. The scheme officially
closed on 30 January 2012.
At 31 December 2011, the Group had no amounts outstanding under
these facilities (2010 - £16.1 billion; 2009 - £21.4 billion).
Government credit and asset-backed securities guarantee schemes
These schemes guarantee eligible debt issued by qualifying institutions
for a fee. The fee, payable to HM Treasury is based on a per annum rate
of 25 (asset-backed securities guarantee scheme) and 50 (credit
guarantee scheme) basis points plus 100% of the institution's median
five-year credit default swap spread during the twelve months to 1 July
2008. The asset-backed securities scheme closed to new issuance on 31
December 2009 and the credit guarantee scheme on 28 February 2010.
At 31 December 2011, the Group had issued debt guaranteed by the
Government totalling £21.3 billion (2010 - £41.5 billion; 2009 - £51.5
billion).
Other related parties
(a) In their roles as providers of finance, Group companies provide
development and other types of capital support to businesses. These
investments are made in the normal course of business and on arm's
length terms. In some instances, the investment may extend to
ownership or control over 20% or more of the voting rights of the
investee company. However, these investments are not considered
to give rise to transactions of a materiality requiring disclosure under
IAS 24.
(b) The Group recharges The Royal Bank of Scotland Group Pension
Fund with the cost of administration services incurred by it. The
amounts involved are not material to the Group.
(c) In accordance with IAS 24, transactions or balances between Group
entities that have been eliminated on consolidation are not reported.
(d) The captions in the primary financial statements of the parent
company include amounts attributable to subsidiaries. These
amounts have been disclosed in aggregate in the relevant notes to
the financial statements.
42 Post balance sheet events
There have been no significant events between the year end and the
date of approval of these accounts which would require a change to or
disclosure in the accounts.