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2008 Financial Summary

Group Income Statement for the year ended 31 December 2008

 

2008
£m

2007
£m

Net interest income

 164.5

188.2

Net losses from fair value volatility

 (28.8)

(43.6)

Net realised losses

 (1.0)

(1.8)

Other income and charges

 31.5

40.9

 166.2

183.7

Administrative expenses

 (122.4)

(120.2)

Provisions

(24.0)

(8.9)

19.8 

54.6

Financial Services Compensation Scheme levy

(14.7)

-

Operating Profit

 5.1

 54.6

Negative goodwill

 3.2

-

Profit before taxation

 8.3

54.6

Taxation

 0.5

(15.4)

Profit for the year

 8.8

39.2

Group Statement of recognised income and expense for the year ended 31 December 2008

 

2008
£m

2007
£m

Available-for-sale investments:

  Valuation losses taken to equity (net of releases)

 (53.7)

(17.2)

Cash Flow hedges:

  Losses taken to equity

(33.6) 

(8.1)

Actuarial gain on retirement benefit obligations

17.8 

33.8

Tax on items taken directly to or transferred from equity

 11.1

(5.0)

Net (expense)/income not recognised directly in the income statement

 (62.0)

3.5

Net profit for the financial year

 8.8

39.2

Total recognised income and expense for the year

 (53.2)

42.7

Group Balance Sheet as at 31 December 2008

 

2008
£m

2007
£m


ASSETS

 

 

Liquid assets

5,327.7 

4,721.9

Mortgages

16,291.8 

15,362.0

Derivative financial instruments

1,226.7 

294.9

Other assets

185.6 

119.5

Total Assets

 23,031.8

20,498.3


LIABILITIES

 

 

Shares

 13,683.1

12,448.2

Borrowings

 7,329.6

6,640.3

Derivative financial instruments

 672.2

94.0

Other liabilities

 157.5

111.1

Subordinated liabilities

112.9

105.0

Subscribed capital

 167.2

146.0

Reserves

 909.3

953.7

Total Liabilities

 23,031.8

20,498.3

Group cash flow statement for the year ended 31 December 2008

 

2008
£m

2007
£m

Net cash flows from operating activities

1,161.6 

161.0

Net cash flows from investing activities

(1,220.4) 

516.5

Net cash flows from financing activities

(519.1) 

526.2

Taxation  refunded/(paid)

4.0 

(14.3)

Net (decrease)/increase in cash and cash equivalents

 (573.9)

1,189.4

Cash and cash equivalents at start of year

 1,961.1

771.7

Cash and cash equivalents at end of year

 1,387.2

1,961.1

Analysis of cash and cash equivalents included in the balance sheet

 

2008
£m

2007
£m

Cash and cash equivalents comprise:
  Cash and balances with central banks

 270.0

413.7

  Loans and advances to banks

 542.0

756.8

  Debt securities

 575.2

790.6

Cash and cash equivalents

 1,387.2

1,961.1

Key ratios


 

2008
%

2007
%

Group net interest margin

0.76

0.99

Group management expenses/mean assets

0.56

0.63

Group asset growth

 12.4

16.7

Group loans and advances growth

 3.7

15.1

Member balances growth

 9.9

10.3

Liquidity ratio

 25.4

24.7

Funding ratio

 33.0

32.3

Gross capital ratio

5.7 

6.3

Free capital ratio

5.2 

5.9

Solvency ratio*

14.8 

14.4

*The 2007 has been restated on a like-for-like basis from 11.8%.

Reconciliation of Core Operating Profits

Profit before tax

2008
£m

2007
£m

Net interest income

 164.5

 188.2

Other income and charges

 31.9

 31.9

Net gains/(losses) arising on realisation

 4.0

 (3.8)

Administrative expenses

 (122.4)

 (120.2)

Mortgage impairment provisions

 (25.0)

 (5.0)

Core Operating Profit

53.0 

91.1

Net losses from fair value volatility

 (28.8)

(43.6)

Other losses realised/other impairment provisions

(7.0) 

(6.9)

Other non recurring items

5.8 

14.0

 23.0

 54.6

Financial Services Compensation Scheme

(14.7)

-

Profit before tax

 8.3

54.6

Taxation

0.5 

(15.4)

Profit for the year

8.8

39.2


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