RBS 2014 Annual Report Download - page 133

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RBS – Interim Results 2015
Forward-looking statements
Certain sections in this document contain ‘forward-looking statements’ as that term is defined in the United States Private
Securities Litigation Reform Act of 1995, such as statements that include the words ‘expect’, ‘estimate’, ‘project’, ‘anticipate’,
‘believe’, ‘should’, ‘intend’, ‘plan’, ‘could’, ‘probability’, ‘risk’, ‘Value-at-Risk (VaR)’, ‘target’, ‘goal’, ‘objective’, ‘may’, ‘endeavour’,
‘outlook’, ‘optimistic’, ‘prospects’ and similar expressions or variations on these expressions.
In particular, this document includes forward-looking statements relating, but not limited to: The Royal Bank of Scotland Group
plc’s (RBS) transformation plan (which includes RBS’s 2013/2014 strategic plan relating to the implementation of its new
divisional and functional structure and the continuation of its balance sheet reduction programme including its proposed
divestments of CFG and Williams & Glyn, RBS’s information technology and operational investment plan, the proposed
restructuring of RBS’s CIB business and the restructuring of RBS as a result of the implementation of the regulatory ring-fencing
regime, together the “Transformation Plan”), as well as restructuring, capital and strategic plans, divestments, capitalisation,
portfolios, net interest margin, capital and leverage ratios, liquidity, risk-weighted assets (RWAs), RWA equivalents (RWAe),
Pillar 2A, Maximum Distributable Amount (MDA), total loss absorbing capacity (TLAC), minimum requirements for eligible
liabilities (MREL), return on equity (ROE), profitability, cost:income ratios, loan:deposit ratios, anticipated AT1 and other capital
raising plans, funding and risk profile; litigation, government and regulatory investigations including investigations relating to the
setting of interest rates and foreign exchange trading and rate setting activities; costs or exposures borne by RBS arising out of
the origination or sale of mortgages or mortgage-backed securities in the US; investigations relating to business conduct and
the costs of resulting customers redress and legal proceedings; RBS’s future financial performance; the level and extent of
future impairments and write-downs; and RBS’s exposure to political risks, credit rating risk and to various types of market risks,
such as interest rate risk, foreign exchange rate risk and commodity and equity price risk. These statements are based on
current plans, estimates, targets and projections, and are subject to inherent risks, uncertainties and other factors which could
cause actual results to differ materially from the future results expressed or implied by such forward-looking statements. For
example, certain market risk and other disclosures are dependent on choices relying on key model characteristics and
assumptions and are subject to various limitations. By their nature, certain of the market risk disclosures are only estimates and,
as a result, actual future gains and losses could differ materially from those that have been estimated.
Other factors that could adversely affect our results and the accuracy of forward-looking statements in this document include the
risk factors and other uncertainties discussed in the 2014 Annual Report and Accounts and this document. These include the
significant risks for RBS presented by the execution of the Transformation Plan; RBS’s ability to successfully implement the
various initiatives that are comprised in the Transformation Plan, particularly the balance sheet reduction programme including
the divestment of Williams & Glyn and its remaining stake in CFG, the proposed restructuring of its CIB business and the
significant restructuring undertaken by RBS as a result of the implementation of the ring fence; whether RBS will emerge from
implementing the Transformation Plan as a viable, competitive, customer focused and profitable bank; RBS’s ability to achieve
its capital targets which depend on RBS’s success in reducing the size of its business; the cost and complexity of the
implementation of the ring-fence and the extent to which it will have a material adverse effect on RBS; the risk of failure to
realise the benefit of RBS’s substantial investments in its information technology and operational infrastructure and systems, the
significant changes, complexity and costs relating to the implementation of the Transformation Plan, the risks of lower revenues
resulting from lower customer retention and revenue generation as RBS refocuses on the UK as well as increasing competition.
In addition, there are other risks and uncertainties. These include RBS’s ability to attract and retain qualified personnel;
uncertainties regarding the outcomes of legal, regulatory and governmental actions and investigations that RBS is subject to
(including active civil and criminal investigations) and any resulting material adverse effect on RBS of unfavourable outcomes;
heightened regulatory and governmental scrutiny and the increasingly regulated environment in which RBS operates;
uncertainty relating to the referendum on the UK’s membership of the EU and the consequences arising from it; operational
risks that are inherent in RBS’s business and that could increase as RBS implements its Transformation Plan; the potential
negative impact on RBS’s business of actual or perceived global economic and financial market conditions and other global
risks; how RBS will be increasingly impacted by UK developments as its operations become gradually more focused on the UK;
uncertainties regarding RBS exposure to any weakening of economies within the EU and renewed threat of default or exit by
certain countries in the Eurozone; the risks resulting from RBS implementing the State Aid restructuring plan including with
respect to the disposal of certain assets and businesses as announced or required as part of the State Aid restructuring plan;
the achievement of capital and costs reduction targets; ineffective management of capital or changes to regulatory requirements
relating to capital adequacy and liquidity; the ability to access sufficient sources of capital, liquidity and funding when required;
deteriorations in borrower and counterparty credit quality; the extent of future write-downs and impairment charges caused by
depressed asset valuations; the value and effectiveness of any credit protection purchased by RBS; the impact of unanticipated
turbulence in interest rates, yield curves, foreign currency exchange rates, credit spreads, bond prices, commodity prices, equity
prices; basis, volatility and correlation risks; changes in the credit ratings of RBS; changes to the valuation of financial
instruments recorded at fair value; competition and consolidation in the banking sector; regulatory or legal changes (including
those requiring any restructuring of RBS’s operations); changes to the monetary and interest rate policies of central banks and
other governmental and regulatory bodies and continued prolonged periods of low interest rates; changes in UK and foreign
laws, regulations, accounting standards and taxes; impairments of goodwill; the high dependence of RBS’s operations on its
information technology systems and its increasing exposure to cyber security threats; the reputational risks inherent in RBS’s
operations; the risk that RBS may suffer losses due to employee misconduct; pension fund shortfalls; the recoverability of
deferred tax assets; HM Treasury exercising influence over the operations of RBS; limitations on, or additional requirements
imposed on, RBS’s activities as a result of HM Treasury’s investment in RBS; and the success of RBS in managing the risks
involved in the foregoing.
The forward-looking statements contained in this document speak only as of the date of this announcement, and RBS does not
undertake to update any forward-looking statement to reflect events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events.
The information, statements and opinions contained in this document do not constitute a public offer under any applicable
legislation or an offer to sell or solicitation of any offer to buy any securities or financial instruments or any advice or
recommendation with respect to such securities or other financial instruments.