CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES (Tables)

12 Months Ended

Dec. 31, 2018

CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES (Tables) [Line Items]

Explanation of credit risk management practices and how they relate to recognition and measurement of expected credit losses [text block]

The table below shows the Group’s ECL for the upside and downside scenarios using a 100 per cent weighting compared to the base case scenario; both stage allocation and the ECL are based on the single scenario only. All non-modelled provisions, including management judgement, remain unchanged.

	Upside £m	Downside £m
ECL allowance	2,775	3,573

Economic Assumptions [Member]

CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES (Tables) [Line Items]

Explanation of credit risk management practices and how they relate to recognition and measurement of expected credit losses [text block]

The key UK economic assumptions made by the Group as at 31 December 2018 averaged over a five-year period are shown below:

Economic assumptions	Base Case %	Upside %	Downside %		Severe downside %
At 31 December 2018
Interest rate	1.25	2.34	1.30		0.71
Unemployment rate	4.5	3.9	5.3		6.9
House price growth	2.5	6.1	(4.8	)	(7.5	)
Commercial real estate price growth	0.4	5.3	(4.7	)	(6.4	)
At 1 January 2018
Interest rate	1.18	2.44	0.84		0.01
Unemployment rate	5.0	4.0	6.1		7.1
House price growth	2.7	7.0	(2.4	)	(8.2	)
Commercial real estate price growth	0.0	3.0	(2.5	)	(5.4	)

Economic assumptions – start to peak	Base Case %	Upside %	Downside %		Severe Downside %
At 31 December 2018
Interest rate	1.75	4.00	1.75		1.25
Unemployment rate	4.8	4.3	6.3		8.6
House price growth	13.7	34.9	0.6		(1.6	)
Commercial real estate price growth	0.1	26.9	(0.5	)	(0.5	)

Economic assumptions – start to trough	Base Case %		Upside %	Downside %		Severe Downside %
At 31 December 2018
Interest rate	0.75		0.75	0.75		0.25
Unemployment rate	4.1		3.5	4.3		4.2
House price growth	0.4		2.3	(26.5	)	(33.5	)
Commercial real estate price growth	(0.1	)	0.0	(23.8	)	(33.8	)

Economic Scenarios [Member]

CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES (Tables) [Line Items]

Explanation of credit risk management practices and how they relate to recognition and measurement of expected credit losses [text block]

The table below shows the extent to which a higher ECL allowance has been recognised to take account of forward looking information from the weighted multiple economic scenarios.

Impact of multiple economic scenarios	Base Case £m	Probability weighted £m	Difference £m
UK mortgages	253	460	207
Other Retail	1,294	1,308	14
Commercial Banking	1,472	1,513	41
Other	81	81	–
At 31 December 2018	3,100	3,362	262
At 1 January 2018	3,182	3,533	351

Increase (Decrease) in House Price Index [Member]

CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES (Tables) [Line Items]

Explanation of credit risk management practices and how they relate to recognition and measurement of expected credit losses [text block]

The table below shows the impact on the Group’s ECL resulting from a decrease/increase in Loss Given Default for a 10 percentage point (pp) increase/decrease in the UK House Price Index (HPI).

	10pp increase in HPI		10pp decrease in HPI
ECL impact, £m	(114	)	154

Increase (Decrease) in Unemployment [Member]

CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES (Tables) [Line Items]

Explanation of credit risk management practices and how they relate to recognition and measurement of expected credit losses [text block]

The table below shows the impact on the Group’s ECL resulting from a decrease/increase in Loss Given Default for a 1 percentage point (pp) increase/decrease in the UK unemployment rate.

	1pp increase in unemployment	1pp decrease in unemployment
ECL impact, £m	172		(155	)