RBS 2012 Annual Report Download - page 81

RBS GROUP 2012
79
2012 2011 2010
£bn £bn £bn
Capital and balance sheet
Loans and advances to customers (gross)
- mortgages 19.2 20.0 21.2
- corporate
- property 4.3 4.8 5.4
- other corporate 7.8 7.7 9.0
- other lending 1.3 1.6 1.3
32.6 34.1 36.9
Loan impairment provisions (3.9) (2.7) (1.6)
Net loans and advances to customers 28.7 31.4 35.3
Risk elements in lending
- mortgages 3.1 2.2 1.5
- corporate
- property 1.9 1.3 0.7
- other corporate 2.3 1.8 1.2
- other lending 0.2 0.2 0.2
Total risk elements in lending 7.5 5.5 3.6
Provision coverage (1) 52% 50% 45%
Customer deposits 22.1 21.8 23.1
Loan:deposit ratio (excluding repos) 130% 143% 152%
Risk-weighted assets 36.1 36.3 31.6
Spot exchange rate - €/£ 1.227 1.196 1.160
Note:
(1) Provision coverage percentage represents loan impairment provisions as a percentage of risk elements in lending.
The challenging macroeconomic environment across the island of Ireland
had a significant impact on Ulster Bank’s financial performance for 2012.
There were some emerging signs of improvement in the Republic of
Ireland economy during Q4 2012, most notably in the availability of
institutional funding, some stabilisation of residential property prices and
continued economic growth, albeit modest.
While impairment levels remained elevated during 2012, net interest
margin and expense management improved. Further progress was made
on Ulster Bank’s deposit gathering strategy with customer deposit
balances increasing by 7% on a constant currency basis in Q4 2012,
driving a significant reduction in the loan to deposit ratio.
Following the Group technology incident in June 2012, Ulster Bank made
significant efforts to help customers who were affected, extending branch
hours, tripling call centre staff and providing full redress.