Natwest Group Plc · LSE:NWG

Natwest — The Royal Bank of Scotland Group — Bank of America Merrill Lynch Conference, London 2015

22 slides from Natwest's conference presentation, Sep 29, 2015

  1. Slide 1: Accelerated delivery to our Go-Forward Bank

    Accelerated delivery to our Go-Forward Bank Ross McEwan Chief Executive Officer Bank of America – Merrill Lynch conference London, 29 September 2015

  2. Slide 2: Our blueprint for lasting success

    Our blueprint for lasting success (1) During the period of CIB restructuring. (2) Excludes restructuring, conduct, litigation and intangible write-off charges as well as the operating costs of Citizens Financial Group and Williams & Glyn. (3) Global Financial 1 Services (GFS) norm currently stands a

  3. Slide 3: Building long-term shareholder value

    Building long-term shareholder value Phase 1 – 2014 Phase 3 – 2017 to 2019 Phase 2 – 2015/16 Building financial strength Becoming #1 Improve our Go-Forward Bank and accelerate our Exit Bank  Rebuild capital strength –  Cement customer-centric CET1 ratio +260bps positioning – #1 for customer during

  4. Slide 4: Our Go-Forward Bank: UK focused Retail & Commercial bank

    Our Go-Forward Bank UK focused Retail & Commercial bank With Markets and international capabilities to meet our clients’ needs, primarily focusing to support their UK and Western European operations Business mix shift towards the UK… …with emphasis on Retail & Commercial Illustrative split by total

  5. Slide 5: Our Go-Forward Bank: RBS in 2019

    Our Go-Forward Bank RBS in 2019 Personal & Commercial & Corporate & Business Private Institutional Our Customers Our Primary Brands  #2 UK Personal Current  #1 SME Bank  Top 3 UK Rates, FX and Accounts DCM  #1 UK Commercial Our  #3 Ireland(1) Personal Bank  Top 3 European Market Current Accoun

  6. Slide 6: Our Exit Bank: Rapid reduction in Exit Group RWAs expected

    Our Exit Bank Rapid reduction in Exit Group RWAs expected Illustrative run-down of RBS Exit Group RWA, £bn -80% 172 148 ~30-40 FY 2014 H1 2015 FY 2016 target 5

  7. Slide 7: Good progress against 2015 goals

    Good progress against 2015 goals Priorities 2015 Goals H1 Progress  RWAs reduced to below £300bn  £326bn RWAs  RCR exit substantially complete  Funded assets down 78% since 1 Strength & sustainability  Citizens exit initial pool of assets identified(1)  Further sell-down priced in late July 20

  8. Slide 8: Strength & Sustainability: Operating Costs Consistently Reduced

    1. Strength & Sustainability Operating Costs Consistently Reduced Adjusted cost reduction progression (£m) (1) -12% -20% 14,010 6,859 12,398 6,344 5,485 2013 2014 H1 2013 H1 2014 H1 2015  Significant future cost opportunities: - Reducing costs in currently very high cost:income franchises (primaril

  9. Slide 9: Continue to invest >£1bn per annum in improving IT

    1. Strength & Sustainability Continue to invest >£1bn per annum in improving IT Transformation Plan Strategic Theme 2015 Target (£m) 2015 – 2017 Target (£m) Strength & Sustainability (640) (1,560) Employee Engagement (90) (190) Simplifying the Bank (200) (590) Customer Experience & (410) (1,150) Sup

  10. Slide 10: Capital and balance sheet resilience

    1. Strength & Sustainability Capital and balance sheet resilience CET1 Ratio: 13% Target Leverage Ratio Non-Performing Loans £bn (Risk Elements in Lending) (as % of Gross L&As) 15.3%(1) 5.3%(2) 39.4 0.7% (9.4%) -53% +670bps 3.0% +190bps 3.4% RCR 8.6% 24.1 (5.8%) 18.7 (4.8%) 4.6% 12.3% 7.4 Ex RCR 11.

  11. Slide 11: We are becoming simpler

    2. Simplifying the Bank Click to edit Master title style We are becoming simpler Total Number of Properties(1) Number of Programmes -14% -16% -67% 2,900 550 2,500 2,100 -18% 1,500 182 150 2013 2014 2015 2016 2013 2014 2015 Number of products(2) Number of registered companies -6% -32% -22% 1050 295 1

  12. Slide 12: Our customers deserve the optimum experience

    3. Customer experience Our customers deserve the optimum experience Stronger Simpler Fairer Apple Pay Stopped teaser UK & Ireland rates/zero balance availability & focused bank transfers Apple Watch app IT resilience and Retail & Business Touch ID login security; mirror bank T&C’s on 1 side enabled

  13. Slide 13: Tailoring our business to changing behaviours

    3. Customer experience Tailoring our business to changing behaviours Over 1000% growth in 16 branch transformations mobile usage since 2010 per week ~3m active mobile 93% of branches re-branded customers by end of 2016 End of 2013 447 3,973 0 6,106 Our expanding presence communities served self serv

  14. Slide 14: Focus on our customers is starting to deliver results

    3. Customer experience Focus on our customers is starting to deliver results Royal Bank of Scotland (Scotland) Net Promoter Scores across our core businesses NatWest (England & Wales) RBSG (GB) Personal Banking(1) Business Banking(2) Commercial Banking(3) 30 20 12 12 9 10 10 10 7 8 6 5 4 4 0 (4) (6)

  15. Slide 15: Customers are responding to our investment

    3. Customer experience Customers are responding to our investment We are: Customers are: investing in advice more engaged Number of mortgage advisors 869 677 +28% -21% Mortgage Mortgage service complaints NPS NatWest +9 H1 2014 H1 2015 H1 2014 / H1 2015 Source: Internal NPS Drivers Study. Latest Bas

  16. Slide 16: Supporting growth: Personal and Business Banking

    4. Supporting growth Personal and Business Banking UK Personal & Business Banking – Mortgages Balances (£bn) Applications (£bn) RBS Q2 2015 market share +4% +43% 101.8 105.4 9.4 10% 8% 6.5 Q2 2014 Q2 2015 Q2 2014 Q2 2015 Stock share Flow share 15

  17. Slide 17: Supporting growth: Commercial Banking

    4. Supporting growth Commercial Banking Positive net lending Gross UK Commercial lending growth Balances, £bn Q2 2015 / Q2 2014 +2.1% +1.6% 83.9 85.7 -4.0% Q2 2014 Q2 2015 Market(1) RBS Note : Excluding RBSI and CIB transfers. (1) Lending to PNFCs (Private Non-Financial Corporations). 16

  18. Slide 18: Ulster Bank, Private Banking and CIB Go-Forward

    Our Go-Forward Bank Ulster Bank, Private Banking and CIB Go-Forward CIB Go-Forward Ulster Bank Private Banking Illustrative cost:income ratio: Q2 2015 Adjusted cost:income Q2 2015 Adjusted cost:income ~100%(1) ratio: 78%(1) ratio: 86%(1)  CIB Go – Forward is  Returns benefiting from ongoing  Grea

  19. Slide 19: CIB Go-Forward is built around core strengths

    Our Go-Forward Bank CIB Go-Forward is built around core strengths 18

  20. Slide 20: Strong, clear, simple investment proposition

    Strong, clear, simple investment proposition Strong customer franchises in large, attractive banking market UK’s pre-eminent SME, Commercial and Corporate bank Significant potential upside from simplification and risk reduction Robust capital, leverage and liquidity positions We aim to return capita

  21. Slide 21: Q&A

  22. Slide 22: 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

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