Annual Report 2015

Home Arrow Investors Arrow Annual Report 2015

“The Board's strategy for this bank is straightforward: a simpler bank focused on doing fewer things, and doing them well, built around a low risk UK and Irish retail and commercial bank.”

Howard Davies, Chairman

Our Priorities

  • Strength and sustainability Maintain bank CET1 ratio of 13%.
  • Customer experience Narrow the gap to No.1 for NPS in every primary UK brand.
  • Simplifying the bank Reduce operating expenses by £800 million(5).
  • Supporting growth Net 4% growth in PBB and CPB customer loans.
  • Employee engagement Raise employee engagement to within two points of GFS norm.

2015 Performance

  • 1,979m)
    Loss attributable to ordinary shareholders
  • £4,405m
    Adjusted operating profit1
  • 15.5%
    Common equity tier 1 ratio
  • 5.6%
    Leverage ratio2
  • 72%
    Adjusted cost: income ratio3
  • 11%
    Adjusted return on tangible equity1,4

Our Strategy

Our plan to build the best bank in the UK & RoI has three phases.

Phase 1
2014

Phase 1 was substantially complete at the end of 2014. The focus was on building capital strength, making the bank safer, reducing costs and simplifying our structure.

Phase 2
2015/16

We are currently in phase 2, improving our core businesses, reducing Risk Weighted Assets and addressing residual conduct issues.

Phase 3
2017/19

Phase 3 will focus on becoming number 1 and achieving attractive, balanced and sustainable financial returns.

Phase 1
2014

Phase 1 was substantially complete at the end of 2014. The focus was on building capital strength, making the bank safer, reducing costs and simplifying our structure.

Phase 2
2015/16

We are currently in phase 2, improving our core businesses, reducing Risk Weighted Assets and addressing residual conduct issues.

Phase 3
2017/19

Phase 3 will focus on becoming number 1 and achieving attractive, balanced and sustainable financial returns.

“RBS made progress again in 2015. We ended the year a simpler, stronger bank with a business anchored squarely in the UK and Ireland, focused on retail and commercial markets.”

Ross McEwan, Chief Executive

Our progress in 2015

We have a clear ambition to become No.1 for customer service, trust and advocacy. In 2015, our focus has been on Cost, Capital, Restructuring and Resilience. We have also begun the process of making RBS a simpler place to work and an easier bank to do business with.

Innovation

First UK bank to enable customers to login to their mobile banking app using only their fingerprint.

Real time registration

This enables customers to have access to mobile banking as they open their current account. Active mobile users have increased 27% to 3.7 million.

Account opening efficiency

New automated account opening process has increased our onboarding process efficiency, with end-to-end account opening times falling by 50% for business customers and 30% for Commercial customers.

Branches refurbished

Branch Transformation programme – 322 branches refurbished, 922 ATMs replaced.

Accessible banking

First banking product to be awarded ‘RNIB approved’ as RBS launched new cards specifically designed for blind and partially sighted customers.

Our Structure

  1. Excluding own credit adjustments, loss on redemption of own debt and strategic disposals and excluding litigation and conduct costs, restructuring costs and write down of goodwill.
  2. Based on end-point CRR Tier 1 capital and leverage exposure based on CRR Delegated Act.
  3. Cost: income ratio is based on total income excluding own credit adjustments, loss on redemption of own debt, strategic disposals, and operating expenses excluding litigation and conduct costs, restructuring costs and write down of goodwill.
  4. Tangible equity is equity attributable to ordinary shareholders less intangible assets
  5. Excluding litigation and conduct costs, restructuring costs, write down of goodwill and other intangible assets and the operating costs of Williams & Glyn.
Home Arrow Investors Arrow Annual Report 2015