RBS 2012 Annual Report Download - page 72

70
Business review continued
UK Corporate
2012 2011 2010
£m £m £m
Net interest income 2,974 3,092 3,000
Net fees and commissions 1,365 1,375 1,353
Other non-interest income 384 396 443
Non-interest income 1,749 1,771 1,796
Total income 4,723 4,863 4,796
Direct expenses
- staff (928) (922) (912)
- other (364) (390) (411)
Indirect expenses (797) (834) (813)
(2,089) (2,146) (2,136)
Operating profit before impairment losses 2,634 2,717 2,660
Impairment losses (838) (793) (767)
Operating profit 1,796 1,924 1,893
Analysis of income by business
Corporate and commercial lending 2,636 2,643 2,571
Asset and invoice finance 685 660 616
Corporate deposits 568 694 738
Other 834 866 871
Total income 4,723 4,863 4,796
Analysis of impairments by sector
Financial institutions 15 20 20
Hotels and restaurants 52 59 52
Housebuilding and construction 143 103 131
Manufacturing 49 34 1
Private sector education, health, social work, recreational and community services 37 113 30
Property 252 170 245
Wholesale and retail trade, repairs 112 85 91
Asset and invoice finance 40 38 64
Shipping 82 22 4
Other 56 149 129
Total impairment losses 838 793 767
Loan impairment charge as % of gross customer loans and advances (excluding reverse repurchase
agreements) by sector
Financial institutions 0.3% 0.3% 0.3%
Hotels and restaurants 0.9% 1.0% 0.8%
Housebuilding and construction 4.2% 2.6% 2.9%
Manufacturing 1.0% 0.7% —
Private sector education, health, social work, recreational and community services 0.4% 1.3% 0.3%
Property 1.0% 0.6% 0.8%
Wholesale and retail trade, repairs 1.3% 1.0% 0.9%
Asset and invoice finance 0.4% 0.4% 0.6%
Shipping 1.1% 0.3% 0.1%
Other 0.2% 0.6% 0.5%
Total 0.8% 0.7% 0.7%
Performance ratios
Return on equity (1) 14.5% 15.2% 13.6%
Net interest margin 3.06% 3.06% 2.89%
Cost:income ratio 44% 44% 45%
Note:
(1) Divisional return on equity is based on divisional operating profit after tax, divided by average notional equity (based on 10% of the monthly average of divisional RWAs, adjusted for capital
deductions).