Natwest Group Plc · LSE:NWG

Natwest — The Royal Bank of Scotland Group — Debt Investor Presentation (February 2016)

19 slides from Natwest's debt investor presentation, Feb 26, 2016

  1. Slide 1: 2015 Annual Results Fixed Income Investor Presentation

    2015 Annual Results Fixed Income Investor Presentation 26 February 2016

  2. Slide 2: Ewen Stevenson, Chief Financial Officer

    Ewen Stevenson Chief Financial Officer

  3. Slide 3: 2015 Results - Key messages

    2015 Results - Key messages Determined to build a great customer bank Strong performance against 2015 targets In 2016, targeting stabilising revenues and positive jaws – in core franchises Continue to address key issues to be able to return to shareholder distributions(1) 1

  4. Slide 4: FY 2015 results

    FY 2015 results Total Core businesses Other RBS Central Ulster Commercial Private RBS Total Capital Total (£bn) UK PBB CIB W&G items & Bank RoI Banking Banking International Franchises Resolution Other other(4) Adj. Income(2) 5.2 0.6 3.3 0.6 0.4 1.4 11.4 0.4 0.8 0.4 1.6 13.0 Adj. Operating expenses(

  5. Slide 5: Balance sheet – resilience

    Balance sheet – resilience CET1 Ratio: 13% Target Leverage Ratio REILs (£bn) (as % of Total Gross L&As) 15.5% 5.6% 39.4 (9.4%) +690bps +220bps Cap (69%) 3.4% Res 8.6% 20.3 12.2 (3.9%) Ex 3.4 Cap Res 8.8 19.1 FY 2013 FY 2015 FY 2013 FY 2015 FY 2013 FY 2015  Excluding Capital Resolution REILs were 3.

  6. Slide 6: Balance sheet – selected exposures

    Balance sheet – selected exposures Oil & Gas (£bn)(6) Mining and Metals (£bn)(6) (65%) (58%) 15.9 3.8 5.6 1.6 FY 2014 FY 2015 FY 2014 FY 2015 Shipping (£bn)(6) Emerging Markets (£bn)(7) (29%) (61%) India 10.6 8.7 China 7.5 2.6 Russia 4.1 3.4 1.9 2.0 1.1 0.4 FY 2014 FY 2015 FY 2014 FY 2015 Note: For

  7. Slide 7: Legacy businesses & portfolios

    Legacy businesses & portfolios Targeting further material reduction by Q4 2016 RWAs RWAs (£bn) 2015 2016 plans FY 2014 FY 2015 CIB Capital  Exceeded £25bn target RWA  Targeting further material RWA 67.2 33.6 Resolution(8) reduction for CIB in 2015 reduction by end 2016 Holding in  40% shared hold

  8. Slide 8: US RMBS litigation, Governmental and regulatory investigations

    US RMBS litigation, Governmental and regulatory investigations FY 2015 balance sheet Comments provision (£bn)  More than 20 lawsuits outstanding involving the issuance of approximately $43bn(11) (original principal balance) of mortgage-backed securities Civil  FHFA (Connecticut) – $32bn $5.6bn (£3

  9. Slide 9: John Cummins, Treasurer

    John Cummins Treasurer

  10. Slide 10: FY 2015 results – Treasurer’s view

    FY 2015 results – Treasurer’s view Strong funding and liquidity metrics maintained Good progress in CET1 ratio build Manageable MREL issuance requirements Target ~£2bn AT1 and ~£3-5bn Senior issuance in 2016(1) (1) Subject to market conditions. 7

  11. Slide 11: Funding & liquidity

    Funding & liquidity FY 2015 FY 2014 Loan : deposit ratio 89% 95% Short-term wholesale funding £17bn £28bn Liquidity portfolio £156bn £151bn Liquidity coverage ratio 136% 112% Net stable funding ratio 121% 112% Stressed outflow coverage 227% 186% 8

  12. Slide 12: Current assessment of appropriate buffers

    Current assessment of appropriate buffers Target CET1 ratio versus maximum distributable amount (“MDA”), % Illustration, based on assumption of static regulatory requirements(4) 15.5 Illustrative headroom(1) 13.0 Illustrative 7.2 10.8 2.2 headroom(1) 1.0 8.3 0.4 2.5 0.6 (3) (4) 2.8 2.8 10.8 8.3 G-SI

  13. Slide 13: Sizing future capital / funding requirements

    Sizing future capital / funding requirements (1) Illustrative future loss absorbency requirements (2) Scaled to Minimum Requirements for Own Funds and Eligible Liabilities (“MREL”) based on Bank of England Consultation Discretionary Buffers G-SIB 1.0% (3)  £2bn AT1 issuance targeted for 2016, Capit

  14. Slide 14: Estimated LAC position

    Estimated LAC position (1) FY 2015 Estimated Loss Absorbing Capital (“LAC”) position (1) Regulatory (4) £’bn LAC value Par Value Value (2,3) (5) Common Equity Tier 1 Capital 37.6 37.6 37.6 Tier 1 Capital: End point CRR compliant AT1 2.0 2.0 2.0 o/w RBS Group Plc (HoldCo) 2.0 2.0 2.0 o/w RBS Operatin

  15. Slide 15: Prospective implementation of UK resolution

    Prospective implementation of UK resolution Illustrative anticipated UK creditor hierarchy Based on RBS interpretation of the creditor hierarchy in a resolution scenario Holding Company  Losses will arise first at ‘OpCo’ level and Senior only apply at ‘HoldCo’ to the extent of any Subordinated Debt

  16. Slide 16: Ring-fencing – update

    Ring-fencing – update (1) Target organisational structure  ~80% of RWAs expected to be committed to Ring- RBS Group plc Fenced Bank (4) (Holding Company)  ~15% RWAs in CIB NRFB. Target well capitalised entity with an investment grade credit rating (4)  Overall group supported by Bank-wide service

  17. Slide 17: Q&A

    Q&A

  18. Slide 18: Footnotes to Ewen Stevenson’s section

    Footnotes to Ewen Stevenson’s section (1) Earliest possible timing is likely to be after Q1 2017, subject to Board and PRA approval. Key milestones before seeking PRA approval for capital distributions would include, among other considerations, maintaining the 13% CET1 ratio target, passing regulato

  19. Slide 19: Forward Looking Statements

    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

The Royal Bank of Scotland Group — Debt Investor Presentation (February 2016) on 6ix