TIDMNBS TIDM96MN
RNS Number : 4354P
Nationwide Building Society
08 February 2019
Nationwide Building Society
Interim Management Statement
Q3 2018/19
8 February 2019
Nationwide Building Society today publishes its Interim
Management Statement covering the period from 5 April 2018 to 31
December 2018 ('Q3 2018/19').
Nationwide grows membership and leads on service(1) as it
attracts one in five current account switchers
Key highlights
-- No. 1 for customer satisfaction amongst our high street peer
group, with a lead of 3.1% (March 2018: 4.6%)(1) , and no. 1 for
consumer trust, with a lead of 2.7% (March 2018: 1.3%)(2) ;
-- More than one in five current account switchers (21.6%; Q3
2017/18: 19.5%) chose Nationwide(3) as we grew current accounts by
5% to 7.7m (4 April 2018: 7.3m);
-- Gross and net mortgage lending grew, to GBP26.8bn (Q3
2017/18: GBP24.1bn) and GBP6.1bn (Q3 2017/18: GBP3.9bn)
respectively; and we helped 59,400 first-time buyers into their own
homes;
-- Deposit balances up by GBP5.9bn (Q3 2017/18: GBP2.3bn) as
members chose to save more with us;
-- Underlying profit of GBP691m (Q3 2017/18: GBP880m) and
statutory profit of GBP703m (Q3 2017/18: GBP886m);
-- Profits are after a charge of GBP167m for asset write-offs
and additional technology spend in line with the Society's
September 2018 announcement of increased investment to meet
members' future needs;
-- Capital further strengthened with CET1 ratio of 31.7% (4
April 2018: 30.5%) and UK leverage ratio of 5.0% (4 April 2018:
4.9%).
Nationwide Building Society Chief Executive, Joe Garner,
said:
"Nationwide Building Society is owned and run for the benefit of
our members - not shareholders. Our membership has grown this year,
we've continued to lead on service(1) and trust(2) , helped more
people into a home, and seen more members trust us with their
money. Our commitment to rewarding these members with great value
products and prioritising long-term value has encouraged more
people to switch their mortgages and current accounts to us, and
save with our Single Access and Loyalty ISAs. We've also helped
59,400 first-time buyers into their first home.
"As a mutual we are different in having more scope to make
decisions in the long-term interest of our members. In September we
took the conscious decision to increase significantly our
investment in the Society in the full knowledge that it would
impact profitability in the short-to medium-term but would be of
long-term benefit to our members. Underlying profit for the first
nine months of the year, at GBP691 million, is broadly flat year on
year, excluding a charge of GBP167 million relating to asset
write-offs and additional technology spend. This investment is to
ensure we can continue to meet our members' changing needs in an
increasingly digital future. At the same time, consistent with
member feedback, we remain committed to and are investing in our
presence on the high street.
"Additionally, in November we announced our commitment to launch
a small business current account and expect to submit a bid for
GBP50 million from the RBS Alternative Remedies Package. Our
service will combine an advanced digital offering that integrates
with our UK-wide network of branches and people to meet the needs
of the many small and micro businesses that are not currently being
well-served by incumbent banks. We believe that a combination of
new technology and traditional face-to-face service will bring to
life our vision for business banking - one built on excellent
levels of service, trust and value.
"Looking ahead to the fourth quarter, as consumers continue to
benefit from considerable choice, we intend to remain competitive
and thus expect that lending margins will continue to moderate. We
are confident that the Society's financial strength means we can
continue to support members, as we have always done."
(1) (c) Ipsos MORI 2019, Financial Research Survey (FRS), 12
months ending 31 December 2018 and 12 months ending 31 March 2018,
c.60,000 adults interviewed per annum, proportion of extremely/very
satisfied customers minus proportion of extremely/very/fairly
dissatisfied customers summed across current account, mortgage and
savings. High street peer group defined as providers with main
current account market share >4% (Barclays, Halifax, HSBC,
Lloyds Bank, NatWest, Santander and TSB).
(2) Source: Nationwide Brand and Advertising tracker compiled by
Independent Research Agency, 12 months ending 31 December 2018 vs
12 months ended 31 March 2018. Financial brands included
Nationwide, Barclays, Co-operative Bank, First Direct, Halifax,
HSBC, Lloyds, NatWest, Santander and TSB.
(3) Source: CASS BACS Payments Schemes monthly CASS switching
market data, Apr-Dec 2018.
Trading performance
9 months ended 9 months ended
31 December 2018 31 December 2017
GBPbn % GBPbn %
----------------------------------------------------------- ------------ ------ ------------ ------
Gross residential mortgage lending/market share (note i) 26.8 12.9 24.1 12.3
Net residential mortgage lending/market share (note i) 6.1 15.2 3.9 10.4
Member deposits balance(4) movement/market share (note i) 5.9 13.5 2.3 4.1
----------------------------------------------------------- ------------ ------ ------------ ------
Number of new current accounts opened 588,000 617,000
----------------------------------------------------------- ------------ ------ ------------ ------
At 31 December 2018 At 5 April 2018 At 4 April 2018
(adjusted)(5) (reported)
GBPbn % GBPbn % GBPbn %
----------- ---------
Residential lending balances(6) 183.3 177.1 177.2
Member deposit balances(4) /market share 153.9 10.1 148.0 10.0
Market share of main standard and packaged current
accounts(7) 7.9 7.9
------------------------------------------------------ ----------- --------- ------------ ---- --------- -------
Note:
i. The calculation of market share for mortgage lending and
deposit balances has been refined to better reflect the position at
the reporting date, with comparatives restated accordingly. Market
data is available at calendar month ends and therefore market share
for Q3 2018/19 and Q3 2017/18 is for the period 1 April to 31
December.
Trading performance for the period has been strong with gross
lending of GBP26.8 billion (Q3 2017/18: GBP24.1 billion), and
growth in member deposit balances of GBP5.9 billion (Q3 2017/18:
GBP2.3 billion).
Gross mortgage lending includes GBP23.4 billion of prime
residential mortgages (Q3 2017/18: GBP21.6 billion), demonstrating
our competitively priced products and the long-term value that we
continue to offer members. Following enhancements to our buy to let
(BTL) product range, the flow of advances has improved with gross
BTL mortgage lending for the period of GBP3.4 billion (Q3 2017/18:
GBP2.5 billion).
Net mortgage lending was GBP6.1 billion (Q3 2017/18: GBP3.9
billion), reflecting higher gross mortgage advances. Net lending
for prime mortgages was GBP5.7 billion (Q3 2017/18: GBP4.3
billion), and for specialist mortgages was GBP0.4 billion (GBP0.4
billion net redemption).
Member deposits grew by GBP5.9 billion following the success of
our Single Access and Loyalty ISAs, together with higher current
account balances. This increased our market share of deposits to
10.1% (31 March 2018: 10.0%). Our stock of all current accounts
continues to grow and now stands at 7.7 million and we've
maintained our share of main standard and packaged current accounts
of 7.9%. Our market share of switchers increased to 21.6% (Q3
2017/18: 19.5%) with 1 in 5 of all switchers(1) moving to
Nationwide.
(4) Member deposits include current account credit balances.
(5) Figures have been adjusted to reflect the impact of applying
IFRS 9 from 5 April 2018. On 5 April 2018, Nationwide implemented
IFRS 9 Financial Instruments. As a result, impairment provisions
increased by GBP172 million. Further information is provided in our
Report on Transition to IFRS 9: Financial Instruments, which can be
found on nationwide.co.uk
(6) Residential lending balances are stated net of impairment
provisions.
(7) Source: CACI (November 2018) and internal calculations. In
June 2018, the size of the market reported for main standard and
packaged current accounts increased due to updates of participant
data. Had this change been applied in the March 2018 data, we
estimate that Nationwide's market share of standard and packaged
current accounts would have been 7.8%.
Financial performance
9 months ended 9 months ended
31 December 2018 31 December 2017
GBPm % GBPm %
--------------------------------------- --------- --------- --------- ---------
Underlying profit before tax (note i) 691 880
Statutory profit before tax 703 886
Statutory profit after tax 535 664
--------------------------------------- --------- --------- --------- ---------
Net interest margin 1.26 1.33
Underlying cost income ratio (note i) 68.4 59.7
Statutory cost income ratio 68.4 59.7
--------------------------------------- --------- --------- --------- ---------
At 31 December 2018 At 5 April 2018 At 4 April 2018
(adjusted)(5) (reported)
GBPbn % GBPbn % GBPbn %
---------- ----------
Total assets 240.1 228.9 229.1
Loans and advances to customers 197.6 191.5 191.7
---------- ----------
Common Equity Tier 1 (CET1) ratio(8) 31.7 30.4 30.5
UK leverage ratio(9) 5.0 4.9 4.9
CRR leverage ratio(10) 4.6 4.6 4.6
Liquidity coverage ratio 152.5 130.3
Wholesale funding ratio 28.8 28.2
-------------------------------------- ---------- ---------- --------- ------- -------- --------
Note:
i. The following items are excluded from statutory profit to
arrive at underlying profit:
-- FSCS costs arising from institutional failures, which are
included within provisions for liabilities and charges.
-- Gains or losses from derivatives and hedge accounting, which
are presented separately within total income.
The components of underlying profit have been changed in the
period to reflect more appropriately ongoing business performance
and now include the bank levy and FSCS management expenses, which
were previously excluded. The comparative for the prior period has
been reduced by GBP3 million to reflect this change. The impact
will be more significant for the full financial year as the bank
levy expense (GBP45 million in 2017/18) is incurred in the last
quarter of the year.
Underlying profit for the period has reduced, principally due to
a charge of GBP167 million driven by asset write-offs and
additional investment in technology, in line with our technology
strategy announcement in September 2018. This has also impacted
cost income ratios, increasing the underlying cost income ratio to
68.4%.
Net interest margin was 7 basis points lower than for the same
period last year, and 5 basis points lower than for the 2017/18
full year. As consumers continue to benefit from considerable
choice, we intend to remain competitive and thus expect that
margins will continue to moderate in retail lending markets
generally, and particularly in relation to both prime and buy to
let mortgages. Attractive new business pricing, combined with a
base rate change in the period, has encouraged product switching as
well as refinancing with our legacy base mortgage rate (BMR)
balances continuing to run off. BMR balances have fallen by 14% to
GBP19.5 billion over the nine-month period.
Costs are flat period on period, excluding asset write-offs and
our additional technology investment, and we are on track to
deliver GBP100 million of sustainable saves within the 2018/19
year.
Asset quality remains strong, with an average loan to value
(LTV) of loan stock for total residential lending of 57% (4 April
2018: 56%). The average LTV of new lending in the period of 71% is
consistent with the prior period.
Arrears performance for residential mortgages is stable with the
number of cases more than three months in arrears at 0.43% of the
total portfolio (4 April 2018: 0.43%).
(8) Common Equity Tier 1 (CET1) ratio has been calculated under
CRD IV on an end point basis. For 31 December 2018 and 5 April
2018, IFRS 9 transitional adjustments have been applied.
(9) The UK leverage ratio is shown on the basis of measurement
announced by the Prudential Regulation Authority (PRA) and excludes
eligible central bank reserves from the leverage exposure measure.
For 31 December 2018 and 5 April 2018, IFRS 9 transitional
adjustments have been applied.
(10) The Capital Requirements Regulation (CRR) leverage ratio is
calculated using the CRR definition of Tier 1 for the capital
amount and the delegated act definition of the exposure measure and
is reported on an end point basis. For 31 December 2018 and 5 April
2018, IFRS 9 transitional adjustments have been applied.
Impairment losses on loans and advances of GBP69 million (Q3
2017/18: GBP79 million reported under IAS 39(11) ) reflect strong
asset quality and stable credit performance.
We continue to review compliance with ongoing and emerging
regulatory matters. During the period there has been a net release
of GBP11 million of provisions for customer redress (Q3 2017/18:
GBP25 million charge), reflecting latest estimates of the
liabilities.
Capital ratios have remained comfortably in excess of regulatory
requirements with a CET1 ratio of 31.7% (4 April 2018: 30.5%(12) )
and a UK leverage ratio of 5.0% (4 April 2018: 4.9%). The
improvement in our CET1 ratio was predominantly due to profits
after tax in the period, partially offset by an increase in risk
weighted assets. As future regulatory developments come into force,
we expect risk weighted assets to be higher and our CET1 ratio
therefore to reduce on a pro forma basis. Further information on
our capital position can be found in Appendix 1.
Publication of Interim Management Statements
Nationwide's core purpose as a building society enables us to
take long term decisions which are in the best interest of current
and future members. Our recent external financial reporting has
emphasised the importance of long-term sustainability and the
prioritisation of security, service and delivering value to members
over pure profit generation. Following a careful review, we've
decided that we will discontinue the publication of an Interim
Management Statement for Q1 and Q3, given the short-term focus of
these updates. This Interim Management Statement for Q3 2018/19
will therefore be the last one routinely issued by the Society.
Additional information
The financial information on which this Interim Management
Statement is based is unaudited and has been prepared on the basis
of International Financial Reporting Standards, incorporating IFRS
9 and its consequential amendments to other standards including
IFRS 7, as endorsed by the EU, and including transitional
arrangements for regulatory capital as appropriate. The Group's
full statement of accounting policies is disclosed within the
Annual Report and Accounts 2018. The revised accounting policies
following adoption of IFRS 9 can be found in the Interim Results
for the period ended 30 September 2018. Additional information on
the transition to IFRS 9 can be found in Nationwide's 'Report on
Transition to IFRS 9: Financial Instruments', available on the
Society's website at nationwide.co.uk.
The Group's first full year set of financial statements prepared
under IFRS 9 will be published in the Annual Report and Accounts
for the year ending 4 April 2019.
For further information please contact:
Investor queries: Alex Wall, 0207 2616568 or 07917 093632,
alexander.wall@nationwide.co.uk
Media contact: Tanya Joseph, 020 72616503 or 07826 922102,
tanya.joseph@nationwide.co.uk
Sara Batchelor, 01793 657770 or 07785 344137,
sara.batchelor@nationwide.co.uk
(11) Under IFRS 9, the recognition and measurement of expected
credit losses differs from under IAS 39. As prior periods have not
been restated, impairment losses on loans and advances in the
comparative periods are not necessarily comparable to impairment
losses recorded for the current period.
(12) The Common Equity Tier 1 (CET1) ratio reported at 4 April
2018 is based on profits reported in accordance with IAS 39.
Underlying profit
Profit before tax shown on a statutory and underlying basis is
set out on page 3. Statutory profit before tax of GBP703 million
has been adjusted to derive an underlying profit before tax of
GBP691 million. The purpose of this measure is to reflect
management's view of the Group's underlying performance and to
assist with like for like comparisons of performance across
periods. Underlying profit is not designed to measure sustainable
levels of profitability as that potentially requires exclusion of
non-recurring items even though they are closely related to (or
even a direct consequence of) the Group's core business activities.
The components of underlying profit have changed in the period to
more accurately reflect underlying performance. For more
information see page 3.
Nationwide has developed a financial performance framework based
on the fundamental principle of maintaining its capital at a
prudent level in excess of regulatory requirements. The framework
provides parameters which allow it to calibrate future performance
and help ensure that it achieves the right balance between
distributing value to members, investing in the business and
maintaining financial strength. The most important of these
parameters is underlying profit which is a key component of
Nationwide's capital. We believe that a level of underlying profit
of approximately GBP0.9 billion to GBP1.3 billion per annum over
the medium-term would meet the Board's objective for sustainable
capital strength. This range will vary from time to time, and
whether our profitability falls within or outside this range in any
given financial year or period will depend on a number of external
and internal factors, including conscious decisions to return value
to members or to make investments in the business. It should not be
construed as a forecast of the likely level of Nationwide's
underlying profit for any financial year or period within a
financial year.
Forward looking statements
Certain statements in this document are forward looking with
respect to plans, goals and expectations relating to the future
financial position, business performance and results of Nationwide.
Although Nationwide believes that the expectations reflected in
these forward-looking statements are reasonable, Nationwide can
give no assurance that these expectations will prove to be an
accurate reflection of actual results. By their nature, all forward
looking statements involve risk and uncertainty because they relate
to future events and circumstances that are beyond the control of
Nationwide including, amongst other things, UK domestic and global
economic and business conditions, market related risks such as
fluctuation in interest rates and exchange rates,
inflation/deflation, the impact of competition, changes in customer
preferences, risks concerning borrower credit quality, delays in
implementing proposals, the timing, impact and other uncertainties
of future acquisitions or other combinations within relevant
industries, the policies and actions of regulatory authorities, the
impact of tax or other legislation and other regulations in the
jurisdictions in which Nationwide operates. The economic outlook
also remains unusually uncertain due to Brexit. As a result,
Nationwide's actual future financial condition, business
performance and results may differ materially from the plans, goals
and expectations expressed or implied in these forward-looking
statements. Due to such risks and uncertainties Nationwide cautions
readers not to place undue reliance on such forward-looking
statements.
Nationwide undertakes no obligation to update any
forward-looking statements whether as a result of new information,
future events or otherwise.
This document does not constitute or form part of an offer of
securities for sale in the United States. Securities may not be
offered or sold in the United States absent registration or an
exemption from registration. Any public offering to be made in the
United States will be made by means of a prospectus that may be
obtained from Nationwide and will contain detailed information
about Nationwide and its management as well as financial
statements.
Appendix 1 - Supplementary capital disclosures
IFRS 9, implemented on 5 April 2018, impacted capital
requirements and resources. The capital ratios as at 5 April 2018
are disclosed on page 3.
Key Metrics (KM1 and IFRS 9 - FL)
31 Dec 30 Sep 30 Jun 4 Apr 31 Dec
2018 2018 2018 2018(13) 2017(13)
-----------------------------------------------
GBPm GBPm GBPm GBPm GBPm
----------------------------------------------- --------- -------- --------- ------------ ----------
Available Capital
Common Equity Tier 1 (CET1) 10,542 10,423 10,154 9,925 9,907
Common Equity Tier 1 if IFRS 9 transitional
arrangements not applied 10,483 10,364 10,095
Tier 1 11,534 11,415 11,146 10,917 10,899
Tier 1 if IFRS 9 transitional arrangements
not applied 11,476 11,356 11,087
Total capital 14,644 14,511 14,263 13,936 15,124
Total capital if IFRS 9 transitional
arrangements not applied 14,640 14,513 14,243
----------------------------------------------- --------- -------- --------- ------------ ----------
Risk-weighted assets (RWA) GBPm GBPm GBPm GBPm GBPm
Total risk- weighted assets 33,243 32,868 32,430 32,509 32,492
Total risk- weighted assets if IFRS
9 transitional arrangements not applied 33,279 32,903 32,465
----------------------------------------------- --------- -------- --------- ------------ ----------
Risk- based capital ratios as a percentage % % % % %
of RWA
Common Equity Tier (CET1) ratio 31.7 31.7 31.3 30.5 30.5
CET1 as if IFRS 9 transitional arrangements
not applied 31.5 31.5 31.1
Tier 1 ratio 34.7 34.7 34.4 33.6 33.5
Tier 1 ratio if IFRS 9 transitional
arrangements not applied 34.5 34.5 34.2
Total regulatory capital 44.1 44.2 44.0 42.9 46.5
Total regulatory capital if IFRS 9
transitional arrangements not applied 44.0 44.1 43.9
----------------------------------------------- --------- -------- --------- ------------ ----------
Additional CET1 buffer requirements % % % % %
as a percentage of RWA
Capital conservation buffer requirement 1.9 1.9 1.9 1.9 1.3
Countercyclical buffer requirement 1.0 0.5 0.5 0.0 0.0
D-SIB additional requirements 0.0 0.0 0.0 0.0 0.0
Total of CET1 specific buffer requirements 2.9 2.4 2.4 1.9 1.3
CET1 available after meeting minimum
capital requirements, but before buffer
requirements 27.2 27.2 26.8 26.0 26.0
----------------------------------------------- --------- -------- --------- ------------ ----------
UK leverage ratio
UK leverage exposure measure (GBPm) 231,901 227,646 227,943 221,992 222,573
UK leverage exposure measure if IFRS
9 transitional arrangements not applied
(GBPm) 231,843 227,587 227,884
UK leverage ratio (%) 5.0 5.0 4.9 4.9 4.9
UK leverage ratio if IFRS 9 transitional
arrangements not applied (%) 4.9 5.0 4.9
----------------------------------------------- --------- -------- --------- ------------ ----------
CRR leverage ratio
CRR leverage ratio exposure measure
(GBPm) 249,531 246,193 244,652 236,468 242,398
CRR leverage ratio exposure measure
if IFRS 9 transitional arrangements
not applied (GBPm) 249,472 246,134 244,594
CRR leverage ratio (%) 4.6 4.6 4.6 4.6 4.5
CRR leverage ratio (%) if IFRS 9 transitional
arrangements not applied 4.6 4.6 4.5
----------------------------------------------- --------- -------- --------- ------------ ----------
Liquidity Coverage Ratio (LCR)(14)
Total high quality liquid assets (HQLA)
(GBPm) 27,484 27,568 27,229 27,145 27,152
Total net cash outflows (GBPm) 19,944 20,301 20,510 20,555 20,400
Liquidity coverage ratio (%) 138 136 133 132 133
----------------------------------------------- --------- -------- --------- ------------ ----------
Note: Capital metrics are on a CRD IV end-point basis.
(13) The 4 April 2018 and 31 December 2017 figures are presented
on an IAS 39 basis. IFRS 9 was adopted on 5 April 2018.
(14) These values are calculated on a simple average basis using
the preceding 12 month-end LCR observations, on a consolidated
currency basis. Nationwide's LCR was 152.5 % as at the 31 December
2018, whilst the average LCR over 12 months ending 31 December 2018
was 138%.
The UK leverage ratio has increased to 5.0% (4 April 2018:
4.9%), with 0.4% provided by Additional Tier 1 resources. Minimum
leverage requirements are monitored by the PRA on a UK leverage
basis with the current regulatory threshold set at 3.65%, composed
of a minimum requirement of 3.25% and a countercyclical leverage
ratio buffer of 0.4%. Following the release of CP14/18 in July
2018, we will be subject to an additional leverage ratio buffer
(ALRB) in 2019, aligned to the implementation of the systemic risk
buffer. Our current expectation is that the ALRB will be 0.35%.
Therefore, the leverage ratio requirement is expected to be 4.0%
during 2019. We remain confident in the strength of our capital
position to meet the increased requirements.
The average UK leverage ratio for the three months to 31
December 2018 was 5.0%, with an average exposure measure of
GBP231,673 million.
Common Equity Tier 1 (CET1) capital resources have increased by
approximately GBP0.6 billion predominantly due to profits after tax
for the period of GBP0.5 billion. The impact of the introduction of
IFRS 9 has been largely offset by the reduction in net expected
loss deduction and further, by the adoption of the transitional
adjustments. RWAs increased over the period by approximately GBP0.7
billion. These movements have strengthened our CET1 ratio to 31.7%
(4 April 2018: 30.5%).
Capital structure
31 December
2018 4 April 2018(13)
GBPm GBPm
------------------------------------------------ ------------ -----------------
Common Equity Tier 1 capital before regulatory
adjustments 11,765 11,351
Total regulatory adjustments to Common Equity
Tier 1 (1,223) (1,426)
------------------------------------------------ ------------ -----------------
Common Equity Tier 1 capital 10,542 9,925
Additional Tier 1 capital before regulatory
adjustments 992 992
Total regulatory adjustments to Additional
Tier 1 capital - -
------------------------------------------------ ------------ -----------------
Additional Tier 1 capital 992 992
------------------------------------------------ ------------ -----------------
Total Tier 1 capital 11,534 10,917
------------------------------------------------ ------------ -----------------
Tier 2 capital before regulatory adjustments 3,110 3,019
Total regulatory adjustments to Tier 2 capital - -
------------------------------------------------ ------------ -----------------
Tier 2 capital 3,110 3,019
------------------------------------------------ ------------ -----------------
Total capital 14,644 13,936
------------------------------------------------ ------------ -----------------
Note: Capital metrics are on a CRD IV end-point basis, with the
application of IFRS 9 transitional arrangements for 31 December
2018.
Overview of RWAs (EU OV1)
RWAs Minimum capital
requirements(15)
31 December 4 April 31 December 4 April
2018 2018(13) 2018 2018(13)
--------------------------------------------------
GBPm GBPm GBPm GBPm
--- --------------------------------------------- ------------ ---------- ------------ ----------
1 Credit risk 26,031 25,875 2,083 2,070
2 Of which standardised approach 1,973 2,364 158 189
Of which the foundation IRB
3 approach 6,025 5,843 482 468
4 Of which the advanced IRB approach 17,819 17,500 1,426 1,400
Of which Equity IRB under the
simple risk-weight or the internal
5 models approach 214 168 17 13
6 Counterparty credit risk 1,902 1,184 152 95
7 Of which marked to market 778 512 62 41
Of which standardised approach
9 for counterparty credit risk 33 28 3 2
Of which risk exposure for contributions
11 to the default fund of a CCP 150 9 12 1
12 Of which CVA 941 635 75 51
13 Settlement risk - - - -
Securitisation exposures in
14 banking book (after cap) 255 290 20 23
15 Of which IRB ratings-based approach 255 290 20 23
19 Market risk(16) - - - -
23 Operational risk 4,901 4,901 392 392
25 Of which Standardised approach 4,901 4,901 392 392
Amounts below the thresholds
for deduction (subject to 250%
27 risk weight) 154 259 12 21
--- --------------------------------------------- ------------ ---------- ------------ ----------
29 Total 33,243 32,509 2,659 2,601
--- --------------------------------------------- ------------ ---------- ------------ ----------
RWA flow statements of credit risk exposures (EU CR8)
IRB credit risk Standardised credit Counterparty credit
risk risk
RWA Capital RWA amounts Capital RWA amounts Capital
amounts requirements requirements requirements
GBPm GBPm GBPm GBPm GBPm GBPm
---------------------- --------- -------------- ------------ -------------- ------------ --------------
RWA as at 4 April
1 2018(13) 23,511 1,881 2,364 189 1,184 95
---------------------- --------- -------------- ------------ -------------- ------------ --------------
2 Asset size 930 75 (389) (31) 645 51
3 Asset quality (383) (31) (2) - 73 6
RWA as at 31 December
9 2018 24,058 1,925 1,973 158 1,902 152
---------------------- --------- -------------- ------------ -------------- ------------ --------------
IRB credit risk RWAs have increased due to continued lending
whilst standardised credit risk RWAs have fallen due to the runoff
of closed books. Counterparty credit risk RWAs have increased due
to higher regulatory exposures. Total RWAs have increased by GBP0.7
billion.
(15) Capital is also held to meet Pillar 2 and capital buffer
requirements. Further details on Pillar 2 requirements can be found
in the Pillar 3 Disclosure 2018 at nationwide.co.uk
(16) Market risk has been set to zero as permitted by the CRR as
exposure is below the threshold of 2% of own funds.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
QRTTRMLTMBMMBPL
(END) Dow Jones Newswires
February 08, 2019 02:00 ET (07:00 GMT)
Nationwide Building Soci... (LSE:NBS)
Historical Stock Chart
From Apr 2024 to May 2024
Nationwide Building Soci... (LSE:NBS)
Historical Stock Chart
From May 2023 to May 2024