REG - Royal Bk Scot.Grp. - Final Results - Part 2 <Origin Href="QuoteRef">RBS.L</Origin> - Part 3
26/02/2015 07:14
- Part 3: For the preceding part double click ID:nRSZ9136Fb
- - 7.6 7.6
33.9 13.7 39.6 28.0 21.5 136.7 173.4 90.8 131.5 518.4 1,050.8
Securities retained 13.6
Total liquidity portfolio 187.0
Liabilities secured
Intra-Group - secondary liquidity (13.1) - - - - (13.1)
Intra-Group - other (11.6) - - - - (11.6)
Third-party (6) (5.6) (7.1) (39.6) (64.6) (10.5) (127.4)
(30.3) (7.1) (39.6) (64.6) (10.5) (152.1)
For the notes to this table refer to page 22.
Appendix 1 Capital and risk management
Balance sheet encumbrance (continued)
Encumbered assets relating to: Encumbered Unencumbered
Debt securities in issue Other secured liabilities Total assets as a Readily realisable (3)
Securitisations Covered Secured encumbered % of related Liquidity Other (4) Cannot be (5)
and conduits bonds Derivatives Repos balances assets (2) assets portfolio Other realisable encumbered Total
31 December 2013 £bn £bn £bn £bn £bn £bn % £bn £bn £bn £bn £bn
Cash and balances at central banks - - - - - - - 74.3 8.4 - - 82.7
Loans and advances to banks 5.8 0.5 10.3 - - 16.6 60 0.1 10.9 - - 27.6
Loans and advances to customers
- UK residential mortgages 14.6 16.2 - - - 30.8 28 60.8 18.6 - - 110.2
- Irish residential mortgages 9.3 - - - 1.2 10.5 70 0.7 3.8 - 0.1 15.1
- US residential mortgages - - - - 3.5 3.5 18 9.5 6.7 - - 19.7
- UK credit cards 3.4 - - - - 3.4 52 - 3.1 - - 6.5
- UK personal loans 3.4 - - - - 3.4 38 - 5.5 - - 8.9
- other 13.5 - 18.1 - 0.8 32.4 14 4.4 9.6 175.6 10.2 232.2
Reverse repurchase agreements
and stock borrowing - - - - - - - - - - 76.5 76.5
Debt securities 0.9 - 5.5 55.6 2.7 64.7 57 17.0 31.9 - - 113.6
Equity shares - - 0.5 5.3 - 5.8 66 - 3.0 - - 8.8
Settlement balances - - - - - - - - - - 5.5 5.5
Derivatives - - - - - - - - - - 288.0 288.0
Intangible assets - - - - - - - - - - 12.4 12.4
Property, plant and equipment - - - - 0.4 0.4 5 - - 7.5 - 7.9
Deferred tax - - - - - - - - - - 3.5 3.5
Prepayments, accrued income and other assets - - - - - - - - - - 8.6 8.6
Assets of disposal groups - - - - - - - - - - 0.2 0.2
50.9 16.7 34.4 60.9 8.6 171.5 166.8 101.5 183.1 405.0 1,027.9
Securities retained 17.4
Total liquidity portfolio 184.2
Liabilities secured
Intra-Group - secondary liquidity (19.1) - - - - (19.1)
Intra-Group - other (18.4) - - - - (18.4)
Third-party (6) (7.8) (9.0) (42.7) (85.1) (6.0) (150.6)
(45.3) (9.0) (42.7) (85.1) (6.0) (188.1)
For the notes to this table refer to the following page.
Appendix 1 Capital and risk management
Balance sheet encumbrance(continued)
Notes:
(1) Includes cash, coin and nostro balance held with the Bank of England as collateral against deposits and notes in circulation.
(2) Encumbered assets are those that have been pledged to provide security for the liability shown above and are therefore not available to secure funding or to meet other collateral needs.
(3) Unencumbered readily realisable assets are those assets on the balance sheet that can be readily used to meet funding or collateral requirements and comprise:
(a) Liquidity portfolio: cash balances at central banks, high quality debt securities and loans that have been pre-positioned with central banks. In addition, the liquidity portfolio includes securitisations of own assets which has reduced over the years and has been replaced by loans.
(b) Other readily realisable assets: including assets that have been enabled for use with central banks; and unencumbered debt securities.
(4) Unencumbered other realisable assets are those assets on the balance sheet that are available for funding and collateral purposes but are not readily realisable in their current form. These assets include loans that could be prepositioned with central banks but have not been subject to internal and external documentation review and diligence work.
(5) Assets that cannot be encumbered include:
(a) derivatives, reverse repurchase agreements and trading related settlement balances.
(b) non-financial assets such as intangibles, prepayments and deferred tax.
(c) loans that cannot be pre-positioned with central banks based on criteria set by the central banks, including those relating to date of origination and level of documentation.
(d) non-recourse invoice financing balances and certain shipping loans whose terms and structure prohibit their use as collateral.
(6) In accordance with market practice RBS employs securities recognised on the balance sheet, and securities received under reverse repo transactions as collateral for repos. Secured derivative liabilities reflect net positions that are collateralised by balance sheet assets.
Appendix 1 Capital and risk management
Credit risk
Credit risk is the risk of financial loss due to the failure of a customer or counterparty to meet its obligation to settle
outstanding amounts. For a description of the bank's credit risk framework, governance, policies and methodologies refer to
the Risk and balance sheet management - Credit risk section - of the 2014 Annual Report and Accounts.
Overview
● Credit quality and impairment -RBS's credit risk portfolio continued to improve with an overall reduction in exposure, an improvement in credit quality and a material provision release in 2014. These improvements were driven by supportive economic and
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