REG - Royal Bk Scot.Grp. - Final Results <Origin Href="QuoteRef">RBS.L</Origin> - Part 3
24/02/2017 07:07
- Part 3: For the preceding part double click ID:nRSX7681Xb
2.19% for Q4 2016, 9 basis points higher than Q4 2015 as the benefit associated with reductions in low yielding 'non-core' assets has been partially offset by modest asset margin pressure and mix impacts across PBB and CPB.
Analysis of results
Year ended Quarter ended
31 December 31 December 31 December 30 September 31 December
2016 2015 2016 2016 2015
Non-interest income £m £m £m £m £m
Net fees and commissions 2,535 2,933 608 643 653
Income from trading activities 820 806 622 465 59
Own credit adjustments 180 309 (114) (156) (115)
(Loss)/gain on redemption of own debt (126) (263) 1 3 (263)
Strategic disposals 164 (157) - (31) (22)
Other operating income 309 528 (109) 219 10
Total non-interest income 3,882 4,156 1,008 1,143 322
Of which:
Capital Resolution (601) 174 (337) 76 (268)
IFRS volatility in Treasury (510) 15 308 (150) 59
Key points
2016 compared with 2015
· Non-interest income was £3,882 million, a reduction of £274 million, or 7%, compared with 2015. Capital Resolution non-interest income reduced by £775 million reflecting planned asset disposal, including £572 million of disposal losses compared with £367
million in 2015, and a funding valuation adjustment of £170 million. In addition, we recognised a charge of £510 million for volatile items under IFRS compared with a £15 million gain in 2015. Partially offsetting, we reported a strategic disposal gain of
£164 million, compared with a loss of £157 million in 2015, a loss on redemption of own debt of £126 million, compared with £263 million in 2015, an FX gain of £349 million following the significant weakening of sterling against the dollar and a £97
million foreign exchange reserve recycling gain.
· Net fees and commissions decreased by £398 million, or 14%, compared with 2015 reflecting the planned Capital Resolution asset run-down, £168 million, a reduction in NatWest Markets, £175 million, and a £36 million reduction in UK PBB, driven by lower
credit card interchange fees and increased cash back payments following the launch of the Rewards account.
· Income from trading activities increased by £14 million to £820 million as a £219 million increase in NatWest Markets income has been partially offset by Capital Resolution, £133 million, and an increased charge for volatile items under IFRS.
· Other operating income reduced by £219 million principally reflecting planned asset disposals in Capital Resolution.
Q4 2016 compared with Q3 2016
· Non-interest income of £1,008 million was £135 million, or 12%, lower than Q3 2016. Capital Resolution decreased by £413 million reflecting planned disposal activity, including disposal losses of £325 million compared with £143 million in Q3 2016, and NatWest Markets reduced by £183 million. Partially offsetting, we recognised a £308 million gain for volatile items under IFRS compared with a loss of £150 million in Q3 2016.
Q4 2016 compared with Q4 2015
· Non-interest income was £686 million higher than Q4 2015. A gain of £308 million was recognised for volatile items under IFRS, compared with £59 million in Q4 2015, and Q4 2015 included a £263 million loss on redemption of own debt. In addition, NatWest Markets non-interest income increased by £98 million to £256 million.
Analysis of results
Year ended Quarter ended
31 December 31 December 31 December 30 September 31 December
2016 2015 2016 2016 2015
Operating expenses £m £m £m £m £m
Staff costs 4,482 4,896 1,025 1,128 1,072
Premises and equipment 1,297 1,483 346 321 422
Other administrative expenses 1,619 2,124 601 393 786
Restructuring costs (see below) 2,106 2,931 1,007 469 614
Litigation and conduct costs 5,868 3,568 4,128 425 2,124
Administrative expenses 15,372 15,002 7,107 2,736 5,018
Depreciation and amortisation 705 778 178 175 170
Write down of goodwill - 498 - - 498
Write down of intangible assets 117 75 69 - 75
Operating expenses 16,194 16,353 7,354 2,911 5,761
Adjusted operating expenses (1) 8,220 9,356 2,219 2,017 2,525
Restructuring costs comprise:
- staff expenses 642 830 117 159 205
- premises, equipment, depreciation and amortisation 164 746 107 33 41
- other 1,300 1,355 783 277 368
2,106 2,931 1,007 469 614
Of which: Williams & Glyn 1,456 658 810 301 209
Staff costs as a % of total income 36% 38% 32% 34% 43%
Cost:income ratio 129% 127% 229% 88% 232%
Cost:income ratio - adjusted (2) 66% 72% 67% 58% 88%
Employee numbers (FTE - thousands) 77.8 91.5 77.8 82.5 91.5
Year ended
31 December 31 December
2016 2015
UK Bank levy segmental allocations £m £m
UK Personal & Business Banking 34 45
Ulster Bank RoI 3 9
Commercial Banking 90 103
Private Banking 19 22
RBS International Banking 19 18
NatWest Markets 13 24
Capital Resolution 22 43
Central items (10) (34)
Total UK Bank levy 190 230
Notes:
(1) Excluding restructuring costs, litigation and conduct costs and write down of goodwill.
(2) Excluding own credit adjustments, (loss)/gain on redemption of own debt, strategic disposals, restructuring costs, litigation and conduct costs and write down of goodwill.
Analysis of results
Key points
2016 compared with 2015
· Operating expenses of £16,194 million were £159 million, or 1%, lower than 2015 reflecting a £1,136 million, or 12%, reduction in adjusted operating expenses and a £825 million, or 28%, reduction in restructuring costs. In addition, 2015 included a £498
million write down of goodwill relating to Private Banking. Partially offsetting the above, litigation and conduct costs increased by £2,300 million.
· Adjusted operating expenses reduced by £1,136 million, or 12%, compared with 2015 to £8,220 million. Excluding expenses associated with Williams & Glyn, write down of intangibles and a £227 million VAT recovery, adjusted expenses reduced by £985(1)
million, or 11%, in excess of our £800 million target. RBS has achieved a cumulative cost reduction of £3.1 billion across 2014 - 2016.
· Staff costs of £4,482 million were £414 million, or 8%, lower than 2015 underpinned by a 13,700, or 15%, reduction in FTEs.
· Restructuring costs were £2,106 million for 2016, compared with £2,931 million in 2015, and included a £750 million provision in respect of the 17 February 2017 update on RBS's remaining State Aid obligation regarding Williams & Glyn. In addition, £706
million of the remaining restructuring costs relate to Williams & Glyn, including £146 million of termination costs associated with the decision to discontinue the programme to create a cloned banking platform.
· Litigation and conduct costs of £5,868 million included; a £3,107 million provision in relation to various investigations and litigation matters relating to RBS's issuance and underwriting of residential mortgage-backed securities (RMBS), £601 million of
additional PPI provisions, a £400 million provision in respect of the FCA review of RBS's treatment of SMEs, an additional £169 million charge in respect of the settlement with the National Credit Union Administration Board to resolve two outstanding RMBS
lawsuits in the United States relating to residential mortgage backed securities, a £172 million provision in Ulster Bank RoI, principally in respect of remediation and programme costs associated with an industry wide examination of tracker mortgages, and
a provision in respect of the UK 2008 rights issue shareholder litigation.
Q4 2016 compared with Q3 2016
· Operating expenses of £7,354 million were £4,443 million higher than Q3 2016 driven by a £3,703 million increase in litigation and conduct costs, a £538 million increase in restructuring costs and a £202 million increase in adjusted operating expenses.
· Adjusted operating expenses of £2,219 million were £202 million higher than Q3 2016 principally reflecting the UK bank levy charge of £190 million.
· Restructuring costs of £1,007 million, compared with £469 million in Q3 2016, and included a £750 million provision in respect of the 17 February 2017 update on RBS's remaining State Aid obligation regarding Williams & Glyn. In addition, £60 million of the remaining cost related to Williams & Glyn, £241 million, or 80%, lower than Q3 2016 following the decision to discontinue the programme to create a cloned banking platform.
· Litigation and conduct costs of £4,128 million included; a £3,107 million provision in relation to various investigations and litigation matters relating to RBS's issuance and underwriting of RMBS, a £400 million provision in respect of the FCA review of RBS's treatment of SMEs, £201 million of additional PPI provisions and a £77 million provision in Ulster Bank RoI, principally in respect of remediation and programme costs associated with an industry wide examination of tracker mortgages.
Q4 2016 compared with Q4 2015
· Operating expenses of £7,354 million were £1,593 million higher than Q4 2015 reflecting a £2,004 million increase in litigation and conduct costs and a £393 million increase in restructuring costs, partially offset by a £498 million write down of goodwill in Q4 2015 and a £306 million reduction in adjusted operating expenses, principally driven by a £218 million reduction in Capital Resolution.
Note:
(1) Operating expenses excluding restructuring costs £2,106 million (2015 - £2,931 million), litigation and conduct costs £5,868 million (2015 - £3,568 million), write down of goodwill nil (2015 - £498 million), write down of other intangible assets of £117 million (2015 - £75 million), the operating costs of Williams and Glyn £393 million (2015 - £359 million) and the VAT recovery £227 million in 2016.
Analysis of results
Year ended Quarter ended
31 December 31 December 31 December 30 September 31 December
2016 2015 2016 2016 2015
Impairment (releases)/losses £m £m £m £m £m
Loan impairment (releases)/losses
- individually assessed 535 (406) (40) 217 (271)
- collectively assessed 218 (35) (1) 176 (27)
- latent (216) (408) (25) (202) (28)
Customer loans 537 (849) (66) 191 (326)
Bank loans - (4) - - -
Total loan impairment (releases)/losses 537 (853) (66) 191 (326)
Securities (59) 126 (9) (47) (1)
Total impairment (releases)/losses 478 (727) (75) 144 (327)
31 December 30 September 31 December
Credit metrics (1) 2016 2016 2015
Gross customer loans £327,478m £332,917m £315,111m
Loan impairment provisions £4,455m £6,181m £7,139m
Risk elements in lending (REIL) £10,310m £12,625m £12,157m
Provisions as a % of REIL 43% 49% 59%
REIL as a % of gross customer loans 3.1% 3.8% 3.9%
Provisions as a % of gross customer loans 1.4% 1.9% 2.3%
Note:
(1) Includes disposal groups and excludes reverse repos.
Key points
2016 compared with 2015
· A net impairment loss of £478 million, 15 basis points of gross customer loans, compared with a net impairment release of £727 million in 2015.
· Capital Resolution reported a net impairment loss of £253 million in 2016 compared with a release of £725 million in 2015. The loss for the year included a charge of £424 million in respect of the shipping portfolio reflecting difficult conditions in some parts of the sector.
· Commercial Banking net impairment loss of £206 million was £137 million higher than 2015 principally reflecting a single name charge in respect of the oil and gas portfolio.
· UK PBB reported a net impairment loss of £83 million compared with a net release of £7 million in 2015.
· Ulster Bank RoI reported a net impairment release of E138 million compared with E194 million in 2015. The 2016 impairment release included a write back associated with the sale of a portfolio of loans. REIL reduced by E0.6 billion driven by the portfolio sale, partially offset by a widening of the definition of loans which are considered to be impaired.
· REIL reduced by £1,847 million during 2016 to £10,310 million reflecting Capital Resolution run-down and a portfolio sale in Ulster Bank RoI partially offset by an increase in the shipping portfolio, foreign exchange movements and the implementation of a revised mortgage methodology in Ulster Bank RoI. REIL represented 3.1% of gross customer loans compared with 3.9% at 31 December 2015. Provision coverage was 43% compared with 59% at 31 December 2015, with the reduction largely driven by Ulster Bank RoI and
Capital Resolution.
· Excluding Ulster Bank RoI and Capital Resolution, REIL represented 1.5% of gross customer loans, compared with 2.0% at end 2015, and provision coverage was 54% compared with 56% in 2015.
Analysis of results
Key points (continued)
Q4 2016 compared with Q3 2016
· A net impairment release of £75 million compared with a net impairment charge of £144 million in Q3 2016.
· Capital Resolution reported a net impairment release of £130 million compared with a net impairment charge of £120 million in Q3 2016.
· Commercial Banking reported a net impairment loss of £83 million compared with £20 million in Q3 2016, with the uplift reflecting single name charges in the quarter.
· REIL of £10,310 million were 3.1% of gross customer loans compared with 3.8% as at 30 September 2016, with the reduction largely reflecting the loan portfolio sale in Ulster Bank RoI.
Q4 2016 compared with Q4 2015
· A net impairment release of £75 million compared with £327 million in Q4 2015. Capital Resolution reported a net impairment release of £130 million compared with £356 million in Q4 2015.
Selected credit risk portfolios
31 December 2016 30 September 2016 31 December 2015
CE (1) PE (1) EAD (2) CE (1) PE (1) EAD (2) CE (1) PE (1) EAD (2)
Natural resources £m £m £m £m £m £m £m £m £m
Oil and gas 2,911 5,286 4,278 2,989 6,000 4,739 3,544 6,798 5,606
Mining and metals 623 1,887 1,344 652 1,782 1,375 729 1,823 1,555
Electricity 3,430 9,076 6,143 3,256 8,466 5,782 2,851 7,683 5,205
Water and waste 5,436 9,176 6,779 5,875 8,772 7,381 4,657 8,261 5,873
12,400 25,425 18,544 12,772 25,020 19,277 11,781 24,565 18,239
Shipping 4,553 5,173 5,035 5,514 6,043 6,154 6,776 7,301 7,509
Notes:
(1) Current Exposure (CE) and Potential Exposure (PE) are both net of impairment provisions and credit valuation adjustments and after the effect of risk transfer. For a full description of what is included and excluded from Current and Potential Exposure refer to page 209 of the 2016 Annual Report and Accounts.
(2) Exposure at default (EAD) reflects an estimate of the extent to which a bank will be exposed under a specific facility on the default of a customer or counterparty.Uncommitted undrawn facilities are excluded from CE but included within EAD; therefore EAD can exceed CE.
Key points
· Oil and gas - Exposures to the oil and gas sector further reduced by £1.5 billion on a PE basis during 2016. Regulated gas distribution companies are no longer reported under the oil and gas sector and this reclassification reduced sector exposure by £724
million. There were also reductions due to the continued run-off of the US and APAC portfolios. Credit quality remained stable with the majority of the portfolio being investment grade. AQ10 potential exposure, net of provisions, was £182 million (31
December 2015 - £38 million).
· Mining and metals - The sector remained largely stable during 2016. The sector was subject to continued tight credit monitoring and ongoing risk appetite review, although concerns have reduced. AQ10 potential exposure, net of provisions was £3 million (31
December 2015 - £21 million).
· Shipping - RBS has decided to wind down its shipping finance portfolio and has also sold some assets. This contributed to the reduction in exposure, which has seen challenging market conditions affect vessel values and contribute to high levels of
forbearance and impairments. Impairment charges of £424 million partially offset by write offs in 2016, increasing provisions by £206 million to £387 million (30 September 2016 - £565 million; 31 December 2015 - £181 million). AQ10 exposure, net of
provisions, was £952 million (30 September 2016 - £1,031 million; 31 December 2015 - £239 million). In addition £363 million of current exposure was classified as at risk of credit loss (30 September 2016 - £775 million).
Analysis of results
Capital and leverage ratios
End-point CRR basis (1) PRA transitional basis
31 December 30 September 31 December 31 December 30 September 31 December
2016 2016 2015 2016 2016 2015
Risk asset ratios % % % % % %
CET1 13.4 15.0 15.5 13.4 15.0 15.5
Tier 1 15.2 16.7 16.3 17.7 19.1 19.1
Total 19.2 20.6 19.6 22.9 24.1 24.7
Capital £m £m £m £m £m £m
Tangible equity 34,982 39,822 40,943 34,982 39,822 40,943
Expected loss less impairment provisions (1,371) (862) (1,035) (1,371) (862) (1,035)
Prudential valuation adjustment (532) (734) (381) (532) (734) (381)
Deferred tax assets (906) (838) (1,110) (906) (838) (1,110)
Own credit adjustments (304) (435) (104) (304) (435) (104)
Pension fund assets (208) (209) (161) (208) (209) (161)
Cash flow hedging reserve (1,030) (1,565) (458) (1,030) (1,565) (458)
Other deductions (8) (9) (86) (8) (9) (64)
Total deductions (4,359) (4,652) (3,335) (4,359) (4,652) (3,313)
CET1 capital 30,623 35,170 37,608 30,623 35,170 37,630
AT1 capital 4,041 4,041 1,997 9,796 9,662 8,716
Tier 1 capital 34,664 39,211 39,605 40,419 44,832 46,346
Tier 2 capital 9,161 9,181 8,002 11,884 11,773 13,619
Total regulatory capital 43,825 48,392 47,607 52,303 56,605 59,965
Risk-weighted assets
Credit risk
- non-counterparty 162,200 166,600 166,400
- counterparty 22,900 25,100 23,400
Market risk 17,400 17,800 21,200
Operational risk 25,700 25,700 31,600
Total RWAs 228,200 235,200 242,600
Leverage (2)
Derivatives 247,000 283,000 262,500
Loans and advances 340,300 346,500 327,000
Reverse repos 41,800 46,000 39,900
Other assets 169,600 176,900 186,000
Total assets 798,700 852,400 815,400
Derivatives
- netting and variation margin (241,700) (281,700) (258,600)
- potential future exposures 65,300 64,100 75,600
Securities financing transactions gross up 2,300 2,200 5,100
Undrawn commitments 58,600 62,100 63,500
Regulatory deductions and other
adjustments 100 4,100 1,500
Leverage exposure 683,300 703,200 702,500
Tier 1 capital 34,664 39,211 39,605
Leverage ratio % 5.1 5.6 5.6
Average leverage exposure (3) 712,145 717,056
Average Tier 1 capital (3) 37,959 38,919
Average leverage ratio % (3) 5.3 5.4
Notes:
(1) CRR as implemented by the PRA in the UK, with effect from 1 January 2014. All regulatory adjustments and deductions to CET1 have been applied in full for both bases with the exception of unrealised gains on available-for-sale securities which have been included from 2015 under the PRA transitional basis.
(2) Based on end-point CRR Tier 1 capital and leverage exposure under the CRR Delegated Act.
(3) Based on 3 month average of month end leverage exposure and Tier 1 Capital.
Analysis of results
Key points
· The CET1 ratio decreased by 210 basis points to 13.4% in 2016, reflecting lower CET1 capital partially offset by a reduction in RWAs.
· Litigation and conduct charges of £5.9 billion in 2016 contributed to a significant reduction in the CET1 capital. Management actions to normalise the ownership structure and improve the long-term resilience of RBS also contributed to the reduction. These actions included the final Dividend Access Share payment of £1.2 billion and the impact of the accelerated pension payment of £4.2 billion.
· Tier 1 capital benefitted from the successful issuance of £2 billion of Additional Tier 1 (AT1) capital notes in August 2016. Total end-point CRR compliant AT1 capital now stands at £4.0 billion.
· RWAs decreased by £14.4 billion in the year to £228.2 billion consisting of reductions across all risk types predominantly driven by the run down activity within Capital Resolution which resulted in an RWA decrease of £14.5 billion.
o Non-counterparty credit risk RWAs have decreased by £4.2 billion reflecting disposal activity in Capital Resolution partly offset by the adverse impact of foreign exchange movements.
o The impact of sterling weakening and the implementation of a new risk model for banks in the first half of the year, led to an increase of £2.8 billion in counterparty credit risk RWAs in NatWest Markets. This was offset by a reduction of £3.3 billion in Capital Resolution to result in an overall decrease of £0.5 billion.
o Market risk RWAs reduced by £3.8 billion driven by disposals in Capital Resolution, business mitigation activity in NatWest Markets and lower US dollar position risk in Treasury.
o Operational risk RWAs decreased by £5.9 billion as a result of the annual recalculation and the removal of the element relating to Citizens following regulatory approval.
· The leverage ratio reduced by 50 basis points to 5.1% at 31 December 2016, primarily reflecting CET1 capital erosion partially offset by additional AT1 issuance.
· The leverage exposure decreased by £19.2 billion to £683.3 billion. Growth in PBB and CPB lending has been more than offset by lower undrawn commitments and derivative potential future exposures. During 2016, approximately half the interest rate trades cleared through London Clearing House have been settled-to-market each day rather than being collateralised, reducing potential future exposures by £10.3 billion.
· The UK leverage ratio reflecting the post EU referendum measures announced by the Bank of England in Q3 2016 was estimated at 5.6%.
Segment performance
Year ended 31 December 2016
PBB CPB Central
Ulster Commercial Private RBS NatWest Capital Williams items & Total
UK PBB Bank RoI Banking Banking International Markets Resolution & Glyn (1) other (2) RBS
£m £m £m £m £m £m £m £m £m £m
Income statement
Net interest income 4,287 409 2,143 449 303 104 239 658 116 8,708
Other non-interest income 1,003 164 1,272 208 71 1,417 (654) 179 4 3,664
Total income - adjusted (3) 5,290 573 3,415 657 374 1,521 (415) 837 120 12,372
Own credit adjustments - 3 - - - 53 134 - (10) 180
Loss on redemption of own debt - - - - - - - - (126) (126)
Strategic disposals - - - - - - (81) - 245 164
Total income 5,290 576 3,415 657 374 1,574 (362) 837 229 12,590
Direct expenses - staff costs (690) (207) (522) (154) (45) (256) (102) (250) (2,256) (4,482)
- other costs (293) (55) (235) (44) (17) (35) (84) (59) (2,916) (3,738)
Indirect expenses (2,022) (195) (1,179) (313) (107) (1,029) (578) (84) 5,507 -
Operating expenses - adjusted (4) (3,005) (457) (1,936) (511) (169) (1,320) (764) (393) 335 (8,220)
Restructuring costs - direct (51) (38) (25) (7) (2) (19) (56) (57) (1,851) (2,106)
- indirect (136) (2) (83) (30) (3) (93) (22) - 369 -
Litigation and conduct costs (634) (172) (423) (1) - (528) (3,413) - (697) (5,868)
Operating expenses (3,826) (669) (2,467) (549) (174) (1,960) (4,255) (450) (1,844) (16,194)
Profit/(loss) before impairment (losses)/releases 1,464 (93) 948 108 200 (386) (4,617) 387 (1,615) (3,604)
Impairment (losses)/releases (83) 113 (206) 3 (10) - (253) (42) - (478)
Operating profit/(loss) 1,381 20 742 111 190 (386) (4,870) 345 (1,615) (4,082)
Operating profit/(loss) - adjusted (3,4) 2,202 229 1,273 149 195 201 (1,432) 402 455 3,674
Additional information
Return on equity (5) 16.2% 0.7% 4.1% 5.6% 13.8% (6.6%) nm nm nm (17.9%)
Return on equity - adjusted (3,4,5) 26.8% 8.4% 8.4% 7.8% 14.2% 1.1% nm nm nm 1.6%
Cost:income ratio 72% 116% 72% 84% 47% 125% nm 54% nm 129%
Cost:income ratio - adjusted (3,4) 57% 80% 57% 78% 45% 87% nm 47% nm 66%
Total assets (£bn) 155.6 24.1 150.5 18.6 23.4 240.0 132.5 25.8 28.2 798.7
Funded assets (£bn) (6) 155.6 24.0 150.5 18.5 23.4 100.9 27.6 25.8 25.4 551.7
Net loans and advances to customers (£bn) 132.1 18.9 100.1 12.2 8.8 17.4 12.8 20.6 0.1 323.0
Risk elements in lending (£bn) 2.0 3.5 1.9 0.1 0.1 - 2.3 0.4 - 10.3
Impairment provisions (£bn) (1.3) (1.2) (0.8) - - - (0.8) (0.2) (0.2) (4.5)
Customer deposits (£bn) 145.8 16.1 97.9 26.6 25.2 8.4 9.5 24.2 0.2 353.9
Risk-weighted assets (RWAs) (£bn) 32.7 18.1 78.5 8.6 9.5 35.2 34.5 9.6 1.5 228.2
RWA equivalent (£bn) (5) 35.7 19.5 82.6 8.6 9.5 37.2 37.5 10.1 1.7 242.4
Employee numbers (FTEs - thousands) 18.3 3.1 5.5 1.7 0.8 1.2 0.4 4.5 42.3 77.8
For the notes to this table refer to page 34. nm = not meaningful
Segment performance
Quarter ended 31 December 2016
PBB CPB Central
Ulster Commercial Private RBS NatWest Capital Williams items & Total
UK PBB Bank RoI Banking Banking International Markets Resolution & Glyn (1) other (2) RBS
£m £m £m £m £m £m £m £m £m £m
Income statement
Net interest income 1,093 105 542 111 77 29 44 170 37 2,208
Other non-interest income 246 32 325 50 19 285 (329) 47 446 1,121
Total income adjusted (3) 1,339 137 867 161 96 314 (285) 217 483 3,329
Own credit adjustments - - - - - (29) (8) - (77) (114)
Gain on redemption of own debt - - - - - - - - 1 1
Total income 1,339 137 867 161 96 285 (293) 217 407 3,216
Direct expenses - staff costs (161) (57) (130) (39) (12) (64) (23) (60) (479) (1,025)
- other costs (72) (23) (69) (12) (4) (7) (3) (13) (991) (1,194)
Indirect expenses (544) (65) (357) (95) (45) (267) (150) (24) 1,547 -
Operating expenses - adjusted (4) (777) (145) (556) (146) (61) (338) (176) (97) 77 (2,219)
Restructuring costs - direct (1) (6) (12) (6) (1) (3) (21) - (957) (1,007)
- indirect (50) 2 (34) (8) (1) (43) 13 - 121 -
Litigation and conduct costs (214) (77) (407) 1 (1) (466) (3,156) - 192 (4,128)
Operating expenses (1,042) (226) (1,009) (159) (64) (850) (3,340) (97) (567) (7,354)
Profit/(loss) before impairment (losses)/releases 297 (89) (142) 2 32 (565) (3,633) 120 (160) (4,138)
Impairment (losses)/releases (16) 47 (83) 8 1 - 130 (11) (1) 75
Operating profit/(loss) 281 (42) (225) 10 33 (565) (3,503) 109 (161) (4,063)
Operating profit/(loss) - adjusted (3,4) 546 39 228 23 36 (24) (331) 109 559 1,185
Additional information
Return on equity (5) 13.5%
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