Final Results. Appendix 2 of

Companies

NATWEST GROUP (NWG)

UK 100

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	2008	2009				Q4 2009 vs.
	Q4	Q1	Q2	Q3	Q4	Q4 2008	Q3 2009
	£m	£m	£m	£m	£m

Net interest income	4,427	3,538	3,322	3,261	3,446	(22%)	6%

Non-interest income (excluding insurance net premium income)	(5,503)	3,776	1,498	2,532	2,786	(151%)	10%
Insurance net premium income	1,439	1,356	1,301	1,301	1,308	(9%)	1%

Non-interest income	(4,064)	5,132	2,799	3,833	4,094	-	7%

Total income	363	8,670	6,121	7,094	7,540	-	6%
Operating expenses	(3,735)	(4,667)	(4,066)	(4,195)	(4,473)	20%	7%

Profit/(loss) before other operating charges	(3,372)	4,003	2,055	2,899	3,067	(191%)	6%
Insurance net claims	(1,056)	(966)	(925)	(1,145)	(1,321)	25%	15%

Operating profit/(loss) before impairment losses	(4,428)	3,037	1,130	1,754	1,746	(139%)	-
Impairment losses	(4,673)	(2,858)	(4,663)	(3,279)	(3,099)	(34%)	(5%)

Group operating (loss)/profit*	(9,101)	179	(3,533)	(1,525)	(1,353)	(85%)	(11%)
Amortisation of purchased intangible assets	(62)	(85)	(55)	(73)	(59)	(5%)	(19%)
Integration and restructuring costs	(752)	(379)	(355)	(324)	(228)	(70%)	(30%)
Gain on redemption of own debt	-	-	3,790	-	-	-	-
Strategic disposals	442	241	212	(155)	(166)	(138%)	7%
Gains on pensions curtailment	-	-	-	-	2,148	-	-
Bonus tax	-	-	-	-	(208)	-	-

Profit/ (loss) before tax	(9,473)	(44)	59	(2,077)	134	(101%)	(106%)
Tax	1,701	(228)	640	576	(649)	(138%)	-

(Loss)/profit from continuing operations	(7,772)	(272)	699	(1,501)	(515)	(93%)	(66%)
From discontinued operations, net of tax	1	(45)	(13)	(7)	(7)	-	-

(Loss)/profit for the period	(7,771)	(317)	686	(1,508)	(522)	(93%)	(65%)
Minority interests	(221)	(471)	(83)	(47)	(47)	(79%)	-
Preference share and other dividends	(162)	(114)	(432)	(245)	(144)	(11%)	(41%)

(Loss) attributable to ordinary shareholders before write-down of goodwill and other intangible assets	(8,154)	(902)	171	(1,800)	(713)	(91%)	(60%)
Write-down of goodwill and other intangible assets, net of tax	(16,196)	-	(311)	-	(52)	(100%)	-
Loss attributable to ordinary shareholders	(24,350)	(902)	(140)	(1,800)	(765)	(97%)	(58%)

	2008	2009				Q4 2009 vs.
Key metrics	Q4	Q1	Q2	Q3	Q4	Q4 2008	Q3 2009

Net interest margin	2.11%	1.78%	1.70%	1.75%	1.83%	(28bp)	8bp
Cost:income ratio	1,028.9%	53.8%	66.4%	59.1%	59.3%	-	(19bp)
Risk-weighted assets - Gross	£577.8bn	£575.7bn	£547.3bn	£594.7bn	£565.8bn	(2%)	(5%)
Benefit of APS	-	-	-	-	(£127.6bn)	-	-
Risk-weighted assets	£577.8bn	£575.7bn	£547.3bn	£594.7bn	£438.2bn	(24%)	(26%)
Risk elements In lending	£18.8bn	£23.7bn	£30.7bn	£35.0bn	£35.0bn	86%	-
Provision balance as % of REIL/PPL*	50%	45%	44%	43%	42%	(800bp)	(100bp)

	2008	2009				Q4 2009 vs.
	Q4	Q1	Q2	Q3	Q4	Q4 2008	Q3 2009
	£m	£m	£m	£m	£m

Operating profit/(loss) before impairment losses
UK Retail	381	371	490	468	579	52%	24%
UK Corporate	487	421	535	566	530	9%	(6%)
Wealth	77	100	134	120	99	29%	(18%)
Global Banking & Markets	(2,817)	3,737	1,018	593	1,001	(136%)	69%
Global Transaction Services	285	240	269	275	228	(20%)	(17%)
Ulster Bank	36	71	78	59	73	103%	24%
US Retail & Commercial	312	182	136	137	134	(57%)	(2%)
RBS Insurance	176	81	142	13	(170)	(197%)	-
Central items	(476)	486	(311)	121	(3)	(99%)	(102%)

Core	(1,539)	5,689	2,491	2,352	2,471	-	5%
Non-Core	(2,889)	(2,652)	(1,361)	(598)	(725)	(75%)	21%

Operating profit/(loss) before impairment losses	(4,428)	3,037	1,130	1,754	1,746	(139%)	-

Included in the above are movements in fair value of own debt:
Global Banking & Markets	(875)	647	(482)	(320)	106	(112%)	(133%)
Central items	14	384	(478)	(163)	164	-	-

	(861)	1,031	(960)	(483)	270	(131%)	(156%)

Impairment losses by division
UK Retail	292	354	470	404	451	54%	12%
UK Corporate	169	100	450	187	190	12%	2%
Wealth	8	6	16	1	10	25%	-
Global Banking & Markets	502	269	(31)	272	130	(74%)	(52%)
Global Transaction Services	40	9	4	22	4	(90%)	(82%)
Ulster Bank	71	67	90	144	348	-	142%
US Retail & Commercial	177	223	146	180	153	(14%)	(15%)
RBS Insurance	42	5	1	2	-	-	-
Central items	11	(3)	1	1	2	(82%)	100%

Core	1,312	1,030	1,147	1,213	1,288	(2%)	6%
Non-Core	3,361	1,828	3,516	2,066	1,811	(46%)	(12%)

Total impairment losses	4,673	2,858	4,663	3,279	3,099	(34%)	(5%)

	2008	2009				Q4 2009 vs.
	Q4	Q1	Q2	Q3	Q4	Q4 2008	Q3 2009
	£m	£m	£m	£m	£m

Operating (loss)/profit by division
UK Retail	89	17	20	64	128	44%	100%
UK Corporate	318	321	85	379	340	7%	(10%)
Wealth	69	94	118	119	89	29%	(25%)
Global Banking & Markets	(3,319)	3,468	1,049	321	871	(126%)	171%
Global Transaction Services	245	231	265	253	224	(9%)	(11%)
Ulster Bank	(35)	4	(12)	(85)	(275)	-	-
US Retail & Commercial	135	(41)	(10)	(43)	(19)	(114%)	(56%)
RBS Insurance	134	76	141	11	(170)	-	-
Central items	(487)	489	(312)	120	(5)	(99%)	(104%)

Core	(2,851)	4,659	1,344	1,139	1,183	(141%)	4%
Non-Core	(6,250)	(4,480)	(4,877)	(2,664)	(2,536)	(59%)	(5%)

Group operating (loss)/profit	(9,101)	179	(3,533)	(1,525)	(1,353)	(85%)	(11%)


Loan impairment losses	4,049	2,276	4,520	3,262	3,032	(25%)	(7%)
Impairment losses on available-for -sale securities	624	582	143	17	67	(89%)	-

	4,673	2,858	4,663	3,279	3,099	(34%)	(5%)


Loan impairment charge as % of gross loans and advances excluding reverse repurchase agreements	2.31%	1.34%	2.98%	2.16%	2.13%	(18bp)	(3bp)

	2008	2009				31 Dec 2009 vs.
	31 Dec	31 Mar	30 June	30 Sept	31 Dec	31 Dec 2008	30 Sept 2009
	£bn	£bn	£bn	£bn	£bn

Risk-weighted assets by division
UK Retail	45.7	49.6	54.0	51.6	51.3	12%	(1%)
UK Corporate	85.7	86.2	89.5	91.0	90.2	5%	(1%)
Wealth	10.8	10.6	10.3	10.7	11.2	4%	5%
Global Banking & Markets	151.8	137.9	112.5	121.5	123.7	(19%)	2%
Global Transaction Services	17.4	18.7	16.7	18.9	19.1	10%	1%
Ulster Bank	24.5	26.2	26.2	28.5	29.9	22%	5%
US Retail & Commercial	63.9	64.3	55.6	62.8	59.7	(7%)	(5%)
Other	7.1	7.8	8.5	9.0	9.4	32%	4%

Core	406.9	401.3	373.3	394.0	394.5	(3%)	-
Non-Core	170.9	174.4	174.0	200.7	171.3	-	(15%)

	577.8	575.7	547.3	594.7	565.8	(2%)	(5%)
Benefit of APS	-	-	-	-	(127.6)	-	-

Total	577.8	575.7	547.3	594.7	438.2	(24%)	(26%)

(1)	Return on equity is based on divisional operating profit after tax, divided by divisional notional equity (based on regulatory capital).
(2)	Adjusted cost:income ratio is based on total income and operating expenses after netting insurance claims against total income.

	2008	2009				Q4 2009 vs.
	Q4	Q1	Q2	Q3	Q4	Q4 2008	Q3 2009
	£m	£m	£m	£m	£m

Income statement
Net interest income	856	797	868	848	939	10%	11%

Net fees and commissions - banking	345	337	321	303	283	(18%)	(7%)
Other non-interest income (net of insurance claims)	54	53	69	69	60	11%	(13%)

Non-interest income	399	390	390	372	343	(14%)	(8%)

Total income	1,255	1,187	1,258	1,220	1,282	2%	5%

Direct expenses
- staff	(236)	(214)	(214)	(206)	(211)	(11%)	2%
- other	(101)	(115)	(102)	(99)	(105)	4%	6%
Indirect expenses	(537)	(487)	(452)	(447)	(387)	(28%)	(13%)

	(874)	(816)	(768)	(752)	(703)	(20%)	(7%)

Operating profit before impairment losses	381	371	490	468	579	52%	24%
Impairment losses	(292)	(354)	(470)	(404)	(451)	54%	12%

Operating profit	89	17	20	64	128	44%	100%

Analysis of income by product
Personal advances	296	305	311	303	273	(8%)	(10%)
Personal deposits	470	397	354	319	279	(41%)	(13%)
Mortgages	186	207	273	319	415	123%	30%
Bancassurance	51	52	69	69	56	10%	(19%)
Cards	208	204	212	225	228	10%	1%
Other	44	22	39	(15)	31	(30%)	-

Total income	1,255	1,187	1,258	1,220	1,282	2%	5%

Analysis of impairment by sector
Mortgages	9	22	41	26	35	-	35%
Personal	169	195	299	247	282	67%	14%
Cards	114	137	130	131	134	18%	2%

	2008	2009				Q4 2009 vs.
Key metrics	Q4	Q1	Q2	Q3	Q4	Q4 2008	Q3 2009

Performance ratios
Return on equity (1)	6.5%	1.2%	1.4%	4.6%	9.3%	288bp	478bp
Net interest margin	3.73%	3.46%	3.69%	3.47%	3.74%	1bp	27bp
Cost:income ratio	63.8%	69.0%	59.6%	57.4%	54.1%	963bp	324bp

	2008	2009				31 Dec 2009 vs.
	31 Dec	31 Mar	30 June	30 Sept	31 Dec	31 Dec 2008	30 Sept 2009
	£bn	£bn	£bn	£bn	£bn

Capital and balance sheet
Loans and advances to customers gross
- mortgages	72.2	73.3	76.6	80.3	83.2	15%	4%
- personal	15.3	15.0	14.4	14.5	13.6	(11%)	(6%)
- cards	6.3	6.0	6.1	6.1	6.2	(2%)	2%

Customer deposits (excluding bancassurance)	78.9	80.3	83.4	85.6	87.2	11%	2%
AUMs - excluding deposits	5.7	4.6	4.7	5.0	5.3	(7%)	6%
Risk elements in lending	3.8	4.1	4.5	4.7	4.6	21%	(2%)
Loan:deposit ratio (excluding repos)	116%	115%	113%	115%	115.0%	(131bp)	40bp

Risk-weighted assets	45.7	49.6	54.0	51.6	51.3	12%	(1%)

	2008	2009				Q4 2009 vs.
	Q4	Q1	Q2	Q3	Q4	Q4 2008	Q3 2009
	£m	£m	£m	£m	£m

Income statement
Net interest income	588	499	560	607	626	6%	3%

Net fees and commissions	215	194	219	223	222	3%	-
Other non-interest income	107	117	109	106	100	(7%)	(6%)

Non-interest income	322	311	328	329	322	-	(2%)

Total income	910	810	888	936	948	4%	1%

Direct expenses
- staff	(210)	(185)	(182)	(174)	(212)	1%	22%
- other	(73)	(74)	(46)	(71)	(77)	5%	8%
Indirect expenses	(140)	(130)	(125)	(125)	(129)	(8%)	3%

	(423)	(389)	(353)	(370)	(418)	(1%)	13%

Operating profit before impairment losses	487	421	535	566	530	9%	(6%)
Impairment losses	(169)	(100)	(450)	(187)	(190)	12%	2%

Operating profit	318	321	85	379	340	7%	(10%)

Analysis of income by business
Corporate and commercial lending	529	538	586	616	661	25%	7%
Asset and invoice finance	53	48	57	59	68	28%	15%
Corporate deposits	338	290	263	241	191	(43%)	(21%)
Other	(10)	(66)	(18)	20	28	-	40%

Total income	910	810	888	936	948	4%	1%


Analysis of impairment by sector
Banks and financial institutions	10	2	3	4	6	(40%)	50%
Hotels and restaurants	13	15	36	7	40	-	-
Housebuilding and construction	31	6	55	58	(13)	(142%)	(122%)
Manufacturing	6	4	17	2	28	-	-