RBS 2013 Annual Report Download - page 4

02
2013 Financial Results
RBS reports a pre-tax loss for 2013 of £8,243 million, including regulatory and redress provisions of £3,844 million, and
impairments and other losses of £4,823 million related to the establishment of RBS Capital Resolution (RCR).
Excluding the impact of the creation of RCR, RBS operating profit (1) was £2,520 million, down 15% from 2012:
• Retail & Commercial down 4% to £4,078 million, with lower income in UK Corporate and International Banking offsetting
improved impairments in Ulster Bank and UK Retail;
• Markets down 58% to £638 million, reflecting smaller balance sheet and reduced risk levels; and
• Non-Core losses down 27% to £2,107 million, with the cost base falling in line with run-off.
In 2013 RBS launched a comprehensive business review, aimed at transforming the bank. The results of this review were
announced on 27 February 2014 (see pages 8 to 10).
Notes:
(1) Operating profit/(loss) before tax, own credit
adjustments, Payment Protection Insurance costs,
Interest Rate Hedging Products redress and related
costs, regulatory and legal actions, integration and
restructuring costs, gain on redemption of own debt,
write-down of goodwill, amortisation of purchased
intangible assets, strategic disposals, bank levy,
write-down of other intangible assets and RFS Holdings
minority interest.
(2) Ratio calculated under requirements in force at 31
December 2013.
(3) Ratio calculated under requirements in force from 1
January 2014.
(4) Net of provisions, including disposal groups and
excluding repurchase agreements.
(5) Excludes derivatives collateral.
(6) Eligible assets held for contingent liquidity purposes
including cash, Government issued securities and other
eligible securities with central banks.
(7) Based on indicative Core attributable profit taxed at
standard rates and Core average tangible equity per the
average balance sheet (89% of Group tangible equity
based on risk-weighted assets at 31 December 2013).
(8) Cost:income ratio is based on total income excluding
own credit adjustments, gain on redemption of own
debt, strategic disposals and RFS Holdings minority
interest, and operating expenses excluding Payment
Protection Insurance costs, Interest Rate Hedging
Products redress and related costs, regulatory and legal
actions, amortisation of purchased intangible assets,
integration and restructuring costs, bank levy,
write-down of goodwill and other intangible assets and
RFS Holdings minority interest.
(9) Includes the impact of business exits such as Citizens
Financial Group and Williams & Glyn; bank levy;
restructuring costs; and, from 2015, the EU resolution
fund charge.
(10) During the year the Group recognised £4,823 million of
impairment and other losses related to the establishment
of RCR. This comprises impairment losses of £4,490
million (of which £173 million relate to core Ulster Bank
assets which were not transferred to RCR but are
subject to the same strategy) and £333 million reduction
in income reflecting asset valuation adjustments.
(£2,303m)
Group operating loss (1)
10.9%
Core Tier 1 ratio – Basel 2.5 (2)
94%
Loan:deposit ratio (4)
4.6%
Core return on equity (7)
(£8,243m)
Loss before tax
£385bn
RWAs
£32bn
Short-term wholesale funding (5)
64%
Core cost:income ratio (8)
(£8,995m)
Attributable loss
8.6%
Common Equity Tier 1 ratio – FLB lll (3)
£146bn
Liquidity portfolio (6)
2.01%
Group net interest margin