RBS 2012 Annual Report Download - page 186

184
Business review Risk and balance sheet management continued
Key credit portfolios*: Commercial real estate continued
Key points
x The overall maturity profile has remained relatively unchanged over
the last 12 months.
x Non-Core exposure maturing in under 1 year has reduced from
£21.7 billion in 2011 to £16.3 billion in 2012.
x The majority of Ulster Bank’s commercial real estate portfolio was
categorised as under 1 year, owing to the high level of non-
performing assets in the portfolio as Ulster Bank includes most
renegotiated facilities as on demand.
x Refinancing risk remains a focus of management attention and is
assessed throughout the credit risk management lifecycle.
AQ1-AQ2 AQ3-AQ4 AQ5-AQ6 AQ7-AQ8 AQ9 AQ10 Total
Portfolio by asset quality (AQ) band £m £m £m £m £m £m £m
2012
Core 767 6,011 16,592 6,575 1,283 5,382 36,610
Non-Core 177 5783,680 3,200 1,029 17,766 26,430
944 6,589 20,272 9,775 2,312 23,148 63,040
2011
Core 1,094 6,71419,054 6,254 3,111 4,33840,565
Non-Core 680 1,2875,951 3,893 2,385 20,085 34,281
1,774 8,001 25,005 10,147 5,496 24,423 74,846
2010
Core 1,055 7,087 20,588 7,829 2,171 3,532 42,262
Non-Core 1,003 2,694 11,249 7,608 4,105 18,489 45,148
2,058 9,781 31,837 15,437 6,276 22,021 87,410
Key points
x There has been an overall decrease in AQ10 during the year with
reductions in Non-Core partially offset by increases in Ulster Bank
and UK Corporate. The increase in defaulted exposure in UK
Corporate is a result of a small number of significant individual
cases. The high proportion of the portfolio in the AQ10 band was
driven by exposures in Non-Core (Ulster Bank and International
Banking) and Core (Ulster Bank).
x Of the total portfolio of £63.0 billion at 31 December 2012, £28.1
billion (2011 - £34.7 billion) was managed within the Group’s
standard credit processes and £5.1 billion (2011 - £5.9 billion)
was receiving varying degrees of heightened credit management
under the Group’s Watchlist process. A further £29.8 billion (2011
- £34.3 billion) was managed within GRG and included Watchlist
and non-performing exposures. The decrease in the portfolio
managed by GRG was driven by Non-Core reductions.
*unaudited