RBS 2012 Annual Report Download - page 27

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RBS GROUP 2012
Making RBS safer
International Banking is making RBS safer by:
reducing third party assets from £69.9 billion
in 2011 to £53.0 billion;
boosting customer deposits by £1.1 billion
as a result of an improved customer offering,
including our Global Liquidity Solutions Portal.
As a result of this reduction in third-party
assets and increase in our deposits, our loan to
deposit ratio has moved from 103% to 85%.
Our core message to our people is that
customers must be at the heart of what we
do and how we do it. We have put in place a
conduct risk framework with integrity of our
staff at its centre. It emphasises the behaviour
we expect from everyone in International
Banking and its messages are reinforced
regularly by our senior leaders.
Building a better bank that serves
customers well
Others recognised our success in
serving customers.
In the Euromoney Cash Management Survey
clients voted us number one cash
management manager in the UK and
number two in Europe. In addition RBS was
number two in Europe and North America
for handling sterling transactions.
RBS was the Greenwich Quality Leader in
Large Corporate Trade Finance in the UK.
It also ranked us number one for Large
Corporate Trade Finance Penetration in
the UK.
Trade & Forfaiting Review named us Best
Trade Bank, Western Europe.
Global Finance rated us Best Supply Chain
Finance Provider, Western Europe, and we
won its Best Customer Implementation of
Supply Chain Financing award for work
carried out for brewer Carlsberg.
These successes came in our first year as we
built the new division. Customer service was
our priority but we still managed to complete a
complex restructuring and to reduce our costs
by £215 million while maintaining our global
reach. We have restructured our business
which puts us in a strong position to serve
customers well in the future.
Changing our culture
International Banking is committed to treating
our customers fairly, continually enhancing the
risk and control framework and conducting
business in an ethical manner. This is how we
will continue to improve our culture and how
we interact with customers.
In addition, we aim to run International Banking
openly and transparently.
The M&IB transformational leadership
programme is designed to develop more
agile, commercially-aware and people-
focused leaders.
We have made our graduate recruitment
process more robust and graduates now
receive more training, with greater emphasis
on what our regulators expect.
We believe that we will serve customers
better if our people look more like our clients.
That is why we increased the proportion of
women in our graduate programme.
We have embedded the principles of correct
behaviour within staff job descriptions.
They will be recognised for demonstrating
compliance and integrity behind their
achievements, as well as for the achievements
themselves in their half-yearly and year-end
performance reviews. These measures are
supported by a suite of intranet-based
learning tools.
International
Banking
John Owen
Chief Executive,
International Banking
Watch or listen to John Owen
www.rbs.com/AnnualReview
Operating profit of £594 million was
£161 million (21 per cent) lower than
in 2011 as a 17 per cent decline in
income was only partially offset by
lower expenses, down 13 per cent, and
impairment losses, down 34 per cent.
Return on equity was lower than in 2011
at 9.2 per cent. The loan to deposit ratio
improved to 85 per cent.
Performance highlights 2012 2011
Operating profit before impairment losses (£m) 705 923
Impairment losses (£m) (111) (168)
Operating profit (£m) 594 755
Return on equity (%) 9.2 11.5