RBS 2013 Annual Report Download - page 98
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Report of the directors
96
Going concern
The Group’s business activities and financial position, the factors likely to
affect its future development and performance and its objectives and
policies in managing the financial risks to which it is exposed and its
capital are discussed in the Business review. The risk factors which could
materially affect the Group’s future results are set out on pages 523 to
536. The Group’s regulatory capital resources and significant
developments in 2013 and anticipated future developments are detailed
on pages 192 to 208. The liquidity and funding section on pages 209 to
226 describes the Group’s funding and liquidity profile, including changes
in key metrics, the build up of liquidity reserves and the outlook for 2014.
Having reviewed the Group’s forecasts, projections and other relevant
evidence, the directors have a reasonable expectation that the Group and
the company will continue in operational existence for the foreseeable
future. Accordingly, the financial statements of the Group and of the
company have been prepared on a going concern basis.
BBA disclosure code
The Group’s 2013 financial statements have been prepared in
compliance with the principles set out in the Code for Financial Reporting
Disclosure published by the British Bankers' Association in 2010.The
Code sets out five disclosure principles together with supporting
guidance. The principles are that the Group and other major UK banks
will provide high quality, meaningful and decision-useful disclosures;
review and enhance their financial instrument disclosures for key areas of
interest to market participants; assess the applicability and relevance of
good practice recommendations to their disclosures acknowledging the
importance of such guidance; seek to enhance the comparability of
financial statement disclosures across the UK banking sector; and clearly
differentiate in their annual reports between information that is audited
and information that is unaudited.
Corporate governance
The company is committed to high standards of corporate governance.
Details are given in the Corporate governance report on pages 35 to 90.
The Corporate governance report and compliance report (pages 91 and
92) form part of this Report of the directors.
Share capital
Details of the ordinary and preference share capital at 31 December 2013
and movements during the year are shown in Note 26 on the
consolidated accounts.
During 2013, the company allotted and issued a total of 78.6 million new
ordinary shares of £1 each for the purposes of ensuring 2013 coupon
payments on discretionary hybrid capital securities were partly
neutralised from a Core Tier 1 capital perspective. The shares were
allotted to UBS AG at the subscription prices and determined by
reference to the average market prices during the sale periods set out
below.
Number of
shares sold
Subscription
price Sale period Gross proceeds
Share price on
allotment
42,967,903 314.188p 3 May 2013 -
17 July 2013 £135 million 321.6p
20,473,967 341.898p 2 August 2013 -
12 September 2013 £70 million 360.4p
15,091,674 331.309p 1 November 2013 -
9 December 2013 £50 million 336.8p
In addition, the company issued 53.7 million ordinary shares of £1 each in
connection with employee share schemes.
Additional information
Where not provided elsewhere in the Report of the directors, the following
additional information is required to be disclosed by Part 6 of Schedule 7
to the Large and Medium-sized Companies and Groups (Accounts and
Reports) Regulations 2008.
The rights and obligations attaching to the company’s ordinary shares
and preference shares are set out in the company’s Articles of
Association, copies of which can be obtained from Companies House in
the UK or can be found at rbs.com>about us.
On a show of hands at a general meeting of the company every holder of
ordinary shares and cumulative preference shares present in person or
by proxy and entitled to vote shall have one vote. On a poll, every holder
of ordinary shares or cumulative preference shares present in person or
by proxy and entitled to vote shall have four votes for every share held.
The notices of Annual General Meetings and General Meetings specify
the deadlines for exercising voting rights and appointing a proxy or
proxies to vote in relation to resolutions to be passed at the meeting.
The cumulative preference shares represent less than 0.015% of the total
voting rights of the company, the remainder being represented by the
ordinary shares.
There are no restrictions on the transfer of ordinary shares in the
company other than certain restrictions which may from time to time be
imposed by laws and regulations (for example, insider trading laws).
Pursuant to the Listing Rules of the FCA, certain employees of the
company require the approval of the company to deal in the company’s
shares.