Santander UK Group Holdings plc | |||||||||||
Half Yearly Financial Report 2023 | |||||||||||
Contents | |||||||||||
CEO review | |||||||||||
Financial overview | |||||||||||
Risk review | |||||||||||
Financial statements | |||||||||||
Shareholder information |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 30 June 2022 | |||||||
£m | £m | |||||||
Net interest income | 2,361 | 2,148 | ||||||
Non-interest income(1) | 297 | 267 | ||||||
Total operating income | 2,658 | 2,415 | ||||||
Operating expenses before credit impairment charges, provisions and charges | (1,232) | (1,186) | ||||||
Credit impairment charges | (105) | (118) | ||||||
Provisions for other liabilities and charges | (148) | (118) | ||||||
Total operating credit impairment charges, provisions and charges | (253) | (236) | ||||||
Profit before tax | 1,173 | 993 | ||||||
Tax on profit | (315) | (233) | ||||||
Profit after tax | 858 | 760 | ||||||
Attributable to: | ||||||||
Equity holders of the parent | 858 | 743 | ||||||
Non-controlling interests | — | 17 | ||||||
Profit after tax | 858 | 760 |
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Retail Banking | Consumer Finance | Corporate & Commercial Banking | Corporate Centre | Total | |||||||||||||
30 June 2023 | £m | £m | £m | £m | £m | ||||||||||||
Net interest income | 1,873 | 79 | 405 | 4 | 2,361 | ||||||||||||
Non-interest income(1) | 85 | 100 | 67 | 45 | 297 | ||||||||||||
Total operating income | 1,958 | 179 | 472 | 49 | 2,658 | ||||||||||||
Operating expenses before credit impairment charges, provisions and charges | (912) | (73) | (170) | (77) | (1,232) | ||||||||||||
Credit impairment charges | (55) | (14) | (36) | — | (105) | ||||||||||||
Provisions for other liabilities and charges | (106) | (3) | 4 | (43) | (148) | ||||||||||||
Total operating credit impairment charges, provisions and charges | (161) | (17) | (32) | (43) | (253) | ||||||||||||
Profit/(loss) before tax | 885 | 89 | 270 | (71) | 1,173 | ||||||||||||
30 June 2022 (Restated)(2) | |||||||||||||||||
Net interest income | 1,792 | 92 | 241 | 23 | 2,148 | ||||||||||||
Non-interest income/(expense)(1) | 107 | 101 | 70 | (11) | 267 | ||||||||||||
Total operating income | 1,899 | 193 | 311 | 12 | 2,415 | ||||||||||||
Operating expenses before credit impairment charges, provisions and charges | (832) | (73) | (181) | (100) | (1,186) | ||||||||||||
Credit impairment (charges)/write-backs | (126) | (13) | 20 | 1 | (118) | ||||||||||||
Provisions for other liabilities and charges | (101) | — | (2) | (15) | (118) | ||||||||||||
Total operating credit impairment charges, provisions and charges | (227) | (13) | 18 | (14) | (236) | ||||||||||||
Profit/(loss) before tax | 840 | 107 | 148 | (102) | 993 |
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30 June 2023 | 31 December 2022 | |||||||
£bn | £bn | |||||||
Customer loans | 210.8 | 219.7 | ||||||
Other assets(1) | 73.5 | 72.5 | ||||||
Total assets | 284.3 | 292.2 | ||||||
Customer deposits | 190.7 | 196.5 | ||||||
Total wholesale funding | 59.9 | 63.0 | ||||||
Other liabilities | 18.8 | 18.0 | ||||||
Total liabilities | 269.4 | 277.5 | ||||||
Shareholders' equity | 14.9 | 14.7 | ||||||
Total liabilities and equity | 284.3 | 292.2 |
30 June 2023 | 31 December 2022 | |||||||
£bn | £bn | |||||||
Retail Banking | 185.9 | 194.6 | ||||||
- Mortgages | 178.7 | 187.1 | ||||||
- Other (Business Banking and unsecured lending) | 7.2 | 7.5 | ||||||
Consumer Finance | 5.3 | 5.4 | ||||||
CCB | 18.4 | 18.5 | ||||||
Corporate Centre | 1.2 | 1.2 | ||||||
Total | 210.8 | 219.7 |
30 June 2023 | 31 December 2022 | |||||||
£bn | £bn | |||||||
Retail Banking | 155.7 | 161.8 | ||||||
- Current accounts | 71.4 | 76.6 | ||||||
- Savings accounts | 67.4 | 67.0 | ||||||
- Business banking accounts | 11.2 | 12.2 | ||||||
- Other retail products | 5.7 | 6.0 | ||||||
CCB | 23.5 | 24.8 | ||||||
Corporate Centre | 11.5 | 9.9 | ||||||
Total | 190.7 | 196.5 |
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30 June 2023 | 31 December 2022 | |||||||||||||
£bn | % | £bn | % | |||||||||||
Capital | ||||||||||||||
CET1 capital | 11.1 | 15.4 | 10.8 | 15.2 | ||||||||||
Total qualifying regulatory capital | 14.6 | 20.3 | 14.5 | 20.4 | ||||||||||
UK leverage | 13.1 | 5.3 | 12.9 | 5.2 | ||||||||||
RWA | 72.0 | 71.2 |
CET1 capital ratio | |||||
% | |||||
Profit net of distributions | 0.51 | ||||
Pension | (0.11) | ||||
Expected loss less provisions | (0.06) | ||||
RWA growth and other | (0.19) | ||||
Minimum | |||||
% | |||||
Pillar 1 | 4.5 | ||||
Pillar 2A | 3.2 | ||||
Capital conservation buffer | 2.5 | ||||
Countercyclical capital buffer | 1.0 | ||||
Current MDA trigger | 11.2 | ||||
Headroom | 4.2 | ||||
CET1 capital ratio | 15.4 |
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30 June 2023 | 31 December 2022 | |||||||||||||
£bn | % | £bn | % | |||||||||||
Loan to deposit ratio | 112 | % | 113 | % | ||||||||||
Total wholesale funding and AT1 | 62.1 | 65.2 | ||||||||||||
of which term funding | 54.7 | 57.8 | ||||||||||||
of which TFSME | 21.0 | 25.0 | ||||||||||||
of which with a residual maturity of less than one year | 13.0 | 11.0 | ||||||||||||
LCR | 50.2 | 160 | % | 49.0 | 163 | % |
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Ref. | 30 June 2023 | 30 June 2022 | |||||||||
£m | £m | ||||||||||
Non-interest income | |||||||||||
Reported | (i) | 297 | 267 | ||||||||
Adjust for transformation related net (loss) / gain on sale of property | (3) | 7 | |||||||||
Adjusted | (ii) | 294 | 274 | ||||||||
Operating expenses before credit impairment charges, provisions and charges | |||||||||||
Reported | (iii) | (1,232) | (1,186) | ||||||||
Adjust for transformation | 65 | 83 | |||||||||
Adjusted | (iv) | (1,167) | (1,103) | ||||||||
Provisions for other liabilities and charges | |||||||||||
Reported | (148) | (118) | |||||||||
Adjust for transformation | 35 | 11 | |||||||||
Adjusted | (113) | (107) | |||||||||
Profit before tax | |||||||||||
Reported | 1,173 | 993 | |||||||||
Specific income, expenses and charges | 97 | 101 | |||||||||
Adjusted profit before tax | 1,270 | 1,094 |
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Ref. | 30 June 2023 | 30 June 2022 | |||||||||
% | % | ||||||||||
Cost-to-income ratio | (iii) divided by the sum of (i) and net interest income | 46 | % | 49 | % | ||||||
Adjusted cost-to-income ratio | (iv) divided by the sum of (ii) and net interest income | 44 | % | 46 | % |
Adjust for transformation | As adjusted | ||||||||||
30 June 2023 | £m | £m | £m | ||||||||
Profit after tax | 858 | 71 | 929 | ||||||||
Annualised profit after tax | 1,730 | 1,872 | |||||||||
Phasing adjustments | (33) | (91) | |||||||||
Profit / adjusted profit due to equity holders of the parent (A) | 1,697 | 1,781 |
Equity adjustments | As adjusted | ||||||||||
30 June 2023 | £m | £m | £m | ||||||||
Average shareholders' equity | 14,812 | ||||||||||
Less average Additional Tier 1 (AT1) securities | (2,196) | ||||||||||
Average ordinary shareholders' equity (B) | 12,616 | ||||||||||
Average goodwill and intangible assets | (1,550) | ||||||||||
Average tangible equity (C) | 11,066 | 223 | 11,289 | ||||||||
Return on ordinary shareholders’ equity (A/B) | 13.5 | % | — | ||||||||
RoTE (A/C) | 15.3 | % | 15.8 | % |
Adjust for transformation | As adjusted | ||||||||||
31 December 2022 | £m | £m | £m | ||||||||
Profit after tax | 1,423 | 254 | 1,677 | ||||||||
Less non-controlling interests of annual profit | (17) | (17) | |||||||||
Profit / adjusted profit due to equity holders of the parent (A) | 1,406 | 1,660 |
Equity adjustments | As adjusted | ||||||||||
31 December 2022 | £m | £m | £m | ||||||||
Average shareholders' equity | 15,545 | ||||||||||
Less average Additional Tier 1 (AT1) securities | (2,194) | ||||||||||
Less average non-controlling interests | (118) | ||||||||||
Average ordinary shareholders' equity (B) | 13,233 | ||||||||||
Average goodwill and intangible assets | (1,548) | ||||||||||
Average tangible equity (C) | 11,685 | 63 | 11,748 | ||||||||
Return on ordinary shareholders’ equity (A/B) | 10.6 | % | — | ||||||||
RoTE (A/C) | 12.0 | % | 14.1 | % |
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CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Risk review | |||||||||||
Contents | |||||||||||
Risk governance | |||||||||||
Credit risk | |||||||||||
Santander UK group level | |||||||||||
Retail Banking | |||||||||||
Consumer Finance | |||||||||||
Corporate & Commercial Banking | |||||||||||
Corporate Centre | |||||||||||
Market risk | |||||||||||
Liquidity risk | |||||||||||
Capital risk | |||||||||||
Pension risk | |||||||||||
Operational risk & resilience | |||||||||||
Conduct and regulatory risk | |||||||||||
Financial crime risk | |||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Overview Credit risk is the risk of loss due to the default or credit quality deterioration of a customer or counterparty to which we provided credit, or for which we assumed a financial obligation. Credit risk management In H123, there were no significant changes in the way we manage credit risk as described in the 2022 Annual Report. Credit risk review In this section, we analyse our key credit risk metrics. | Key metrics Stage 3 ratio of 1.38% (2022: 1.24%). Loss allowances of £1,019m (2022: £1,007m). Balance weighted average LTV of 65% (2022: 69%) on new mortgage lending. |
Base case key macroeconomic assumptions | ||
–House price growth: The sharp rise in mortgage rates triggered a slowdown in house price growth in recent months. With survey indicators pointing to a slump in buyer demand as confidence is hit by a squeeze on affordability from the sharp rise in mortgage rates, house prices are expected to continue declining in the near-term. We forecast a 7% year-on-year decline in house prices by the end of 2023, with a further fall of 2% by the end of 2024. Once the Bank Rate starts to reduce, house price growth starts to recover with growth back to average levels by the end of the forecast period. | ||
–GDP: While the latest monthly estimate for May 2023 showed the economy contracting marginally with a 0.1% month-on-month fall, the broader picture is one of a stagnating economy, with no growth on a quarterly basis and GDP just 0.2% above its pre-pandemic level. The latest PMI data suggest growth will continue in Q223, but activity is likely to have been affected by the extra bank holiday in May 2023 for the King's Coronation. As such, the near-term outlook for growth remains broadly flat - but as the effects of higher interest rates filter through the economy this year and the bulk of fixed rate mortgages are renewed, consumer spending growth could fall back sharply and with business insolvencies expected to increase, there are still downside risks to our forecast of 0.1% growth in 2023. | ||
–Unemployment rate: Unemployment rose to 4.0% in the 3 months to May 2023 as labour supply was boosted by a further fall in inactivity. Job vacancies fell for the thirteenth consecutive quarter by 85,000 in the three months to June 2023, the biggest fall outside of the pandemic since the start of 2009. With companies under pressure from rising debt servicing costs and higher wages, it is likely that some will become insolvent and others find that demand for their goods and services reduces as households restrict their spending. We do not envisage a large rise in unemployment compared to previous recessions. The rate peaks at 4.5% by the end of 2024, in part impacted by the ongoing return of previously inactive workers to the labour force. | ||
–Bank Rate: For the Bank Rate forecast, the Monetary Policy Committee (MPC) raised rates for the 14th consecutive time in August 2023 to 5.25%, taking the cumulative rise in the current tightening cycle to 515bps. Our base case assumes a further rate rise September 2023, taking the peak in Bank Rate to 5.50%. We expect the MPC to start loosening monetary policy in the second half of 2024, with rates ending 2024 at 4.75%. Further cuts through the rest of the 5 year forecast period leaves bank rate at 3.00% at the end of 2028. |
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Upside 1 | Base case | Downside 1 | Stubborn Inflation | Downside 2 | Weighted | ||||||||||||||||||
% | % | % | % | % | % | ||||||||||||||||||
GDP(1) | 2022 (actual) | 4.1 | 4.1 | 4.1 | 4.1 | 4.1 | 4.1 | ||||||||||||||||
2023 | 0.3 | 0.1 | (0.2) | (0.5) | (1.6) | (0.2) | |||||||||||||||||
2024 | 1.1 | 0.3 | (0.4) | (1.9) | (3.2) | (0.5) | |||||||||||||||||
2025 | 2.3 | 1.3 | 0.4 | — | 0.1 | 0.9 | |||||||||||||||||
2026 | 2.4 | 1.5 | 0.3 | 0.4 | 1.1 | 1.2 | |||||||||||||||||
Peak to trough(2) | — | (0.2) | (1.0) | (2.8) | (5.2) | (1.3) | |||||||||||||||||
Bank Rate(1) | 2022 (actual) | 3.50 | 3.50 | 3.50 | 3.50 | 3.50 | 3.50 | ||||||||||||||||
2023 | 5.00 | 5.50 | 6.00 | 7.00 | 5.00 | 5.75 | |||||||||||||||||
2024 | 3.75 | 4.75 | 5.25 | 5.50 | 3.00 | 4.68 | |||||||||||||||||
2025 | 2.75 | 3.75 | 4.00 | 4.00 | 2.50 | 3.60 | |||||||||||||||||
2026 | 2.50 | 3.25 | 3.25 | 3.25 | 2.50 | 3.10 | |||||||||||||||||
5 yr Peak | 5.00 | 5.50 | 6.00 | 7.00 | 5.25 | 5.78 | |||||||||||||||||
HPI(1) | 2022 (actual) | 5.0 | 5.0 | 5.0 | 5.0 | 5.0 | 5.0 | ||||||||||||||||
2023 | (3.6) | (7.0) | (5.8) | (7.5) | (11.8) | (7.1) | |||||||||||||||||
2024 | (4.4) | (2.0) | (7.6) | (10.2) | (12.9) | (5.5) | |||||||||||||||||
2025 | 2.0 | 2.0 | 2.0 | 2.0 | 2.0 | 2.0 | |||||||||||||||||
2026 | 3.0 | 3.0 | 3.0 | 3.0 | 3.0 | 3.0 | |||||||||||||||||
Peak to trough(2) | (10.2) | (11.0) | (15.0) | (19.0) | (25.0) | (14.3) | |||||||||||||||||
Unemployment(1) | 2022 (actual) | 3.7 | 3.7 | 3.7 | 3.7 | 3.7 | 3.7 | ||||||||||||||||
2023 | 4.2 | 4.2 | 4.5 | 4.5 | 6.6 | 4.5 | |||||||||||||||||
2024 | 4.2 | 4.5 | 5.0 | 5.7 | 8.3 | 5.1 | |||||||||||||||||
2025 | 3.9 | 4.4 | 5.4 | 6.1 | 7.7 | 5.1 | |||||||||||||||||
2026 | 3.8 | 4.3 | 5.9 | 6.5 | 7.1 | 5.1 | |||||||||||||||||
5 yr Peak | 4.3 | 4.5 | 6.1 | 6.5 | 8.5 | 5.4 |
Upside 1 | Base case | Downside 1 | Stubborn Inflation | Downside 2 | Weighted | ||||||||||||||||||
% | % | % | % | % | % | ||||||||||||||||||
GDP(1) | 2021 (actual) | 7.5 | 7.5 | 7.5 | 7.5 | 7.5 | 7.5 | ||||||||||||||||
2022 | 4.4 | 4.4 | 4.3 | 4.2 | 3.7 | 4.3 | |||||||||||||||||
2023 | (1.0) | (1.3) | (1.9) | (2.7) | (6.4) | (2.2) | |||||||||||||||||
2024 | 0.8 | 0.5 | (0.3) | (0.9) | (0.7) | — | |||||||||||||||||
2025 | 2.0 | 1.6 | 0.5 | 0.2 | 1.7 | 1.2 | |||||||||||||||||
2026 | 2.0 | 1.5 | 0.4 | 0.6 | 1.5 | 1.2 | |||||||||||||||||
Bank Rate(1) | 2021 (actual) | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | ||||||||||||||||
2022 | 3.50 | 3.50 | 3.50 | 3.50 | 3.50 | 3.50 | |||||||||||||||||
2023 | 3.75 | 4.00 | 3.50 | 6.00 | 3.75 | 4.29 | |||||||||||||||||
2024 | 3.00 | 3.25 | 2.75 | 5.50 | 3.00 | 3.59 | |||||||||||||||||
2025 | 2.50 | 2.75 | 2.50 | 3.50 | 2.75 | 2.85 | |||||||||||||||||
2026 | 2.25 | 2.50 | 2.25 | 3.00 | 2.50 | 2.55 | |||||||||||||||||
HPI(1) | 2021 (actual) | 8.7 | 8.7 | 8.7 | 8.7 | 8.7 | 8.7 | ||||||||||||||||
2022 | 7.6 | 7.0 | 7.6 | 7.6 | 7.6 | 7.3 | |||||||||||||||||
2023 | (8.8) | (10.0) | (10.0) | (10.9) | (15.8) | (10.7) | |||||||||||||||||
2024 | (4.3) | — | (6.7) | (8.8) | (14.3) | (4.4) | |||||||||||||||||
2025 | 0.6 | 2.0 | (3.1) | (4.9) | (4.1) | (0.8) | |||||||||||||||||
2026 | 4.1 | 3.0 | (0.2) | (0.6) | 4.7 | 2.0 | |||||||||||||||||
Unemployment(1) | 2021 (actual) | 4.0 | 4.0 | 4.0 | 4.0 | 4.0 | 4.0 | ||||||||||||||||
2022 | 3.7 | 3.8 | 3.7 | 3.7 | 4.4 | 3.8 | |||||||||||||||||
2023 | 4.7 | 4.7 | 5.1 | 5.5 | 8.5 | 5.3 | |||||||||||||||||
2024 | 4.5 | 5.1 | 5.4 | 5.9 | 8.0 | 5.6 | |||||||||||||||||
2025 | 4.5 | 4.5 | 5.8 | 6.4 | 7.4 | 5.4 | |||||||||||||||||
2026 | 4.4 | 4.3 | 6.1 | 6.6 | 6.8 | 5.3 |
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Upside 1 | Base case | Downside 1 | Stubborn Inflation | Downside 2 | ||||||||||||||||
30 June 2023 | % | % | % | % | % | |||||||||||||||
House price growth | 5-year average increase/decrease | 0.01 | (0.19) | (1.10) | (2.05) | (3.54) | ||||||||||||||
Peak/(trough) at (1) | (10.16) | (11.04) | (15.02) | (19.02) | (25.02) | |||||||||||||||
GDP | 5-year average increase/decrease | 1.70 | 0.91 | 0.06 | (0.28) | (0.28) | ||||||||||||||
Cumulative growth/(fall) to peak/(trough) (2) | 8.79 | 4.66 | 0.31 | (1.39) | (1.41) | |||||||||||||||
Unemployment rate | 5-year end period | 3.40 | 4.00 | 5.61 | 5.87 | 5.86 | ||||||||||||||
Peak/(trough) at (1) | 4.32 | 4.50 | 6.09 | 6.52 | 8.50 | |||||||||||||||
Bank of England bank rate | 5-year end period | 2.50 | 3.00 | 3.00 | 3.00 | 2.50 | ||||||||||||||
Peak/(trough) at (1) | 5.00 | 5.50 | 6.00 | 7.00 | 5.25 |
31 December 2022 | % | % | % | % | % | |||||||||||||||
House price growth | 5-year average increase/decrease | (0.73) | (0.62) | (3.79) | (4.69) | (4.82) | ||||||||||||||
Peak/(trough) at (1) | (12.79) | (11.19) | (19.00) | (23.12) | (30.69) | |||||||||||||||
GDP | 5-year average increase/decrease | 1.17 | 0.75 | (0.17) | (0.45) | (0.63) | ||||||||||||||
Cumulative growth/(fall) to peak/(trough) (2) | 5.98 | 3.80 | (0.84) | (2.23) | (3.12) | |||||||||||||||
Unemployment rate | 5-year end period | 4.17 | 4.28 | 6.09 | 6.40 | 6.23 | ||||||||||||||
Peak/(trough) at (1) | 4.72 | 5.10 | 6.12 | 6.64 | 8.50 | |||||||||||||||
Bank of England bank rate | 5-year end period | 2.25 | 2.50 | 2.25 | 3.00 | 2.50 | ||||||||||||||
Peak/(trough) at (1) | 3.75 | 4.00 | 3.50 | 6.00 | 4.00 |
Upside 1 | Base case | Downside 1 | Stubborn Inflation | Downside 2 | Weighted | |||||||||||||||
Scenario weights | % | % | % | % | % | % | ||||||||||||||
30 June 2023 | 10 | 50 | 10 | 20 | 10 | 100 | ||||||||||||||
31 December 2022 | 5 | 50 | 15 | 20 | 10 | 100 |
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Homes | Everyday Banking | Consumer Finance | CCB | Corporate Centre | Total | ||||||||||||||||||
Mortgages | Credit Cards | Other | |||||||||||||||||||||
30 June 2023 | £m | £m | £m | £m | £m | £m | £m | ||||||||||||||||
Modelled ECL | 123 | 119 | 108 | 66 | 204 | — | 620 | ||||||||||||||||
Individually assessed | 4 | — | — | — | 136 | — | 140 | ||||||||||||||||
ECL before JAs | 127 | 119 | 108 | 66 | 340 | — | 760 | ||||||||||||||||
JAs (excluding Affordability and Cost of Living JAs) | |||||||||||||||||||||||
Long-term indeterminate arrears | 14 | — | — | — | — | — | 14 | ||||||||||||||||
12+ months in arrears | 16 | — | — | — | — | — | 16 | ||||||||||||||||
UPL loss floor | — | — | 12 | — | — | — | 12 | ||||||||||||||||
Model underestimation | 32 | 3 | — | — | — | — | 35 | ||||||||||||||||
Corporate single large exposure | — | — | — | — | 23 | — | 23 | ||||||||||||||||
Other | 17 | 1 | 6 | 3 | 3 | — | 30 | ||||||||||||||||
Total JAs (excluding Affordability and Cost of Living JAs) | 79 | 4 | 18 | 3 | 26 | — | 130 | ||||||||||||||||
Affordability and Cost of Living JAs | |||||||||||||||||||||||
Corporate lending to segments affected by supply chain | — | — | — | — | 50 | — | 50 | ||||||||||||||||
Secured affordability | 21 | — | — | 4 | — | — | 25 | ||||||||||||||||
Unsecured affordability | — | 23 | 24 | — | — | — | 47 | ||||||||||||||||
SME debt burden | — | — | 7 | — | — | — | 7 | ||||||||||||||||
Total Affordability and Cost of Living JAs | 21 | 23 | 31 | 4 | 50 | — | 129 | ||||||||||||||||
Total JAs | 100 | 27 | 49 | 7 | 76 | — | 259 | ||||||||||||||||
Total ECL | 227 | 146 | 157 | 73 | 416 | — | 1,019 | ||||||||||||||||
Homes | Everyday Banking | Consumer Finance | CCB | Corporate Centre | Total | ||||||||||||||||||
Mortgages | Credit Cards | Other | |||||||||||||||||||||
31 December 2022 | £m | £m | £m | £m | £m | £m | £m | ||||||||||||||||
Modelled ECL | 134 | 112 | 93 | 65 | 194 | — | 598 | ||||||||||||||||
Individually assessed | — | — | — | — | 112 | — | 112 | ||||||||||||||||
ECL before JAs | 134 | 112 | 93 | 65 | 306 | — | 710 | ||||||||||||||||
JAs (excluding Affordability and Cost of Living JAs) | |||||||||||||||||||||||
Long-term indeterminate arrears | 13 | — | — | — | — | — | 13 | ||||||||||||||||
12+ months in arrears | 22 | — | — | — | — | — | 22 | ||||||||||||||||
UPL loss floor | — | — | 15 | — | — | — | 15 | ||||||||||||||||
Model underestimation | 36 | 2 | 19 | — | — | — | 57 | ||||||||||||||||
Corporate sector staging risks | — | — | — | — | 23 | — | 23 | ||||||||||||||||
Other JA | 21 | 1 | 10 | 2 | 3 | — | 37 | ||||||||||||||||
Total JAs (excluding Affordability and Cost of Living JAs) | 92 | 3 | 44 | 2 | 26 | — | 167 | ||||||||||||||||
Affordability and Cost of Living JAs | |||||||||||||||||||||||
Corporate lending to segments affected by supply chain | — | — | — | — | 61 | — | 61 | ||||||||||||||||
Mortgage affordability | 27 | — | — | — | — | — | 27 | ||||||||||||||||
Retail Unsecured Affordability | — | 15 | 20 | — | — | — | 35 | ||||||||||||||||
SME debt burden | — | — | 7 | — | — | — | 7 | ||||||||||||||||
Total Affordability and Cost of Living JAs | 27 | 15 | 27 | — | 61 | — | 130 | ||||||||||||||||
Total JAs | 119 | 18 | 71 | 2 | 87 | — | 297 | ||||||||||||||||
Total ECL | 253 | 130 | 164 | 67 | 393 | — | 1,007 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Upside 1 | Base case | Downside 1 | Stubborn Inflation | Downside 2 | Weighted | |||||||||||||||
30 June 2023 | £m | £m | £m | £m | £m | £m | ||||||||||||||
Exposure | 307,571 | 307,571 | 307,571 | 307,571 | 307,571 | 307,571 | ||||||||||||||
Retail Banking | 209,995 | 209,995 | 209,995 | 209,995 | 209,995 | 209,995 | ||||||||||||||
– Homes - Mortgages | 189,061 | 189,061 | 189,061 | 189,061 | 189,061 | 189,061 | ||||||||||||||
– EDB - Credit Cards | 12,988 | 12,988 | 12,988 | 12,988 | 12,988 | 12,988 | ||||||||||||||
– EDB - Other | 7,946 | 7,946 | 7,946 | 7,946 | 7,946 | 7,946 | ||||||||||||||
Consumer Finance | 5,784 | 5,784 | 5,784 | 5,784 | 5,784 | 5,784 | ||||||||||||||
CCB | 27,536 | 27,536 | 27,536 | 27,536 | 27,536 | 27,536 | ||||||||||||||
Corporate Centre | 64,256 | 64,256 | 64,256 | 64,256 | 64,256 | 64,256 | ||||||||||||||
ECL | 904 | 944 | 1,034 | 1,139 | 1,331 | 1,019 | ||||||||||||||
Retail Banking | 451 | 478 | 535 | 606 | 752 | 530 | ||||||||||||||
– Homes - Mortgages | 170 | 187 | 224 | 280 | 422 | 227 | ||||||||||||||
– EDB - Credit Cards | 138 | 141 | 150 | 155 | 155 | 146 | ||||||||||||||
– EDB - Other | 143 | 150 | 161 | 171 | 175 | 157 | ||||||||||||||
Consumer Finance | 71 | 72 | 71 | 75 | 75 | 73 | ||||||||||||||
CCB | 382 | 394 | 428 | 458 | 504 | 416 | ||||||||||||||
Corporate Centre | — | — | — | — | — | — | ||||||||||||||
% | % | % | % | % | % | |||||||||||||||
Proportion of assets in Stage 2 | 4 | 4 | 5 | 6 | 9 | 6 | ||||||||||||||
Retail Banking | 4 | 4 | 5 | 6 | 9 | 7 | ||||||||||||||
– Homes - Mortgages | 4 | 4 | 5 | 6 | 10 | 7 | ||||||||||||||
– EDB - Credit Cards | 3 | 3 | 3 | 3 | 3 | 3 | ||||||||||||||
– EDB - Other | 8 | 8 | 9 | 9 | 9 | 9 | ||||||||||||||
Consumer Finance | 6 | 6 | 6 | 6 | 6 | 6 | ||||||||||||||
CCB | 12 | 13 | 14 | 18 | 22 | 12 | ||||||||||||||
Corporate Centre | — | — | — | — | — | — | ||||||||||||||
% | % | % | % | % | % | |||||||||||||||
Proportion of assets in Stage 3 | 1 | 1 | 1 | 1 | 1 | 1 | ||||||||||||||
Retail Banking | 1 | 1 | 1 | 1 | 1 | 1 | ||||||||||||||
– Homes - Mortgages | 1 | 1 | 1 | 1 | 1 | 1 | ||||||||||||||
– EDB - Credit Cards | — | — | — | — | — | — | ||||||||||||||
– EDB - Other | 2 | 2 | 2 | 2 | 2 | 2 | ||||||||||||||
Consumer Finance | — | — | — | — | — | — | ||||||||||||||
CCB | 2 | 2 | 2 | 2 | 2 | 2 | ||||||||||||||
Corporate Centre | — | — | — | — | — | — |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Upside 1 | Base case | Downside 1 | Stubborn Inflation | Downside 2 | Weighted | |||||||||||||||
31 December 2022 | £m | £m | £m | £m | £m | £m | ||||||||||||||
Exposure | 312,830 | 312,830 | 312,830 | 312,830 | 312,830 | 312,830 | ||||||||||||||
Retail Banking | 216,383 | 216,383 | 216,383 | 216,383 | 216,383 | 216,383 | ||||||||||||||
– Homes - Mortgages | 195,170 | 195,170 | 195,170 | 195,170 | 195,170 | 195,170 | ||||||||||||||
– EDB - Credit Cards | 12,845 | 12,845 | 12,845 | 12,845 | 12,845 | 12,845 | ||||||||||||||
– EDB - Other | 8,368 | 8,368 | 8,368 | 8,368 | 8,368 | 8,368 | ||||||||||||||
Consumer Finance | 5,739 | 5,739 | 5,739 | 5,739 | 5,739 | 5,739 | ||||||||||||||
CCB | 28,299 | 28,299 | 28,299 | 28,299 | 28,299 | 28,299 | ||||||||||||||
Corporate Centre | 62,409 | 62,409 | 62,409 | 62,409 | 62,409 | 62,409 | ||||||||||||||
ECL | 931 | 933 | 994 | 1,150 | 1,384 | 1,007 | ||||||||||||||
Retail Banking | 490 | 498 | 530 | 648 | 831 | 546 | ||||||||||||||
– Homes - Mortgages | 215 | 219 | 245 | 325 | 502 | 253 | ||||||||||||||
– EDB - Credit Cards | 122 | 123 | 127 | 140 | 142 | 130 | ||||||||||||||
– EDB - Other | 153 | 156 | 158 | 183 | 187 | 163 | ||||||||||||||
Consumer Finance | 65 | 66 | 65 | 68 | 69 | 67 | ||||||||||||||
CCB | 376 | 369 | 399 | 434 | 484 | 394 | ||||||||||||||
Corporate Centre | — | — | — | — | — | — | ||||||||||||||
% | % | % | % | % | % | |||||||||||||||
Proportion of assets in Stage 2 | 4 | 4 | 5 | 7 | 11 | 7 | ||||||||||||||
Retail Banking | 4 | 4 | 4 | 6 | 10 | 7 | ||||||||||||||
– Homes - Mortgages | 4 | 4 | 4 | 6 | 11 | 7 | ||||||||||||||
– EDB - Credit Cards | 2 | 2 | 2 | 3 | 3 | 3 | ||||||||||||||
– EDB - Other | 7 | 7 | 7 | 8 | 9 | 8 | ||||||||||||||
Consumer Finance | 6 | 6 | 6 | 6 | 6 | 6 | ||||||||||||||
CCB | 8 | 9 | 9 | 14 | 18 | 12 | ||||||||||||||
Corporate Centre | — | — | — | — | — | — | ||||||||||||||
% | % | % | % | % | % | |||||||||||||||
Proportion of assets in Stage 3 | 1 | 1 | 1 | 1 | 1 | 1 | ||||||||||||||
Retail Banking | 1 | 1 | 1 | 1 | 1 | 1 | ||||||||||||||
– Homes - Mortgages | 1 | 1 | 1 | 1 | 1 | 1 | ||||||||||||||
– EDB - Credit Cards | — | — | — | — | — | — | ||||||||||||||
– EDB - Other | 2 | 2 | 2 | 2 | 2 | 2 | ||||||||||||||
Consumer Finance | 1 | 1 | 1 | 1 | 1 | 1 | ||||||||||||||
CCB | 2 | 2 | 2 | 2 | 2 | 2 | ||||||||||||||
Corporate Centre | — | — | — | — | — | — |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Santander UK risk grade | Loss allowance | Total | ||||||||||||||||||||||||||||||
9 | 8 | 7 | 6 | 5 | 4 | 3 to 1 | Other(1) | |||||||||||||||||||||||||
30 June 2023 | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | ||||||||||||||||||||||
Exposures - On balance sheet | ||||||||||||||||||||||||||||||||
Financial assets at amortised cost: | ||||||||||||||||||||||||||||||||
–Loans and advances to customers(2) | 2.6 | 34.1 | 87.8 | 53.3 | 15.2 | 8.7 | 5.5 | 8.7 | (0.9) | 215.0 | ||||||||||||||||||||||
–Stage 1 | 2.6 | 33.8 | 86.1 | 48.9 | 11.0 | 3.2 | 0.3 | 8.5 | (0.1) | 194.3 | ||||||||||||||||||||||
–Stage 2 | — | 0.3 | 1.7 | 4.4 | 4.1 | 5.4 | 2.6 | 0.1 | (0.5) | 18.1 | ||||||||||||||||||||||
–Stage 3 | — | — | — | — | 0.1 | 0.1 | 2.6 | 0.1 | (0.3) | 2.6 | ||||||||||||||||||||||
Of which mortgages: | 2.5 | 31.9 | 84.0 | 45.9 | 7.2 | 3.9 | 3.3 | 1.2 | (0.2) | 179.7 | ||||||||||||||||||||||
–Stage 1 | 2.5 | 31.7 | 82.3 | 41.8 | 4.1 | 0.5 | 0.1 | 1.2 | — | 164.2 | ||||||||||||||||||||||
–Stage 2 | — | 0.2 | 1.7 | 4.1 | 3.1 | 3.3 | 1.4 | — | (0.1) | 13.7 | ||||||||||||||||||||||
–Stage 3 | — | — | — | — | — | 0.1 | 1.8 | — | (0.1) | 1.8 | ||||||||||||||||||||||
ECL - On balance sheet | ||||||||||||||||||||||||||||||||
Financial assets at amortised cost: | ||||||||||||||||||||||||||||||||
–Loans and advances to customers(2) | — | — | — | 0.1 | 0.1 | 0.2 | 0.5 | — | 0.9 | |||||||||||||||||||||||
–Stage 1 | — | — | — | 0.1 | — | — | — | — | 0.1 | |||||||||||||||||||||||
–Stage 2 | — | — | — | — | 0.1 | 0.2 | 0.2 | — | 0.5 | |||||||||||||||||||||||
–Stage 3 | — | — | — | — | — | — | 0.3 | — | 0.3 | |||||||||||||||||||||||
Of which mortgages: | — | — | — | — | — | 0.1 | 0.1 | — | 0.2 | |||||||||||||||||||||||
–Stage 1 | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||
–Stage 2 | — | — | — | — | — | 0.1 | — | — | 0.1 | |||||||||||||||||||||||
–Stage 3 | — | — | — | — | — | — | 0.1 | — | 0.1 | |||||||||||||||||||||||
Santander UK risk grade | |||||||||||||||||||||||||||||
9 | 8 | 7 | 6 | 5 | 4 | 3 to 1 | Other(1) | Total | |||||||||||||||||||||
30 June 2023 | % | % | % | % | % | % | % | % | % | ||||||||||||||||||||
Coverage ratio - On balance sheet | |||||||||||||||||||||||||||||
Financial assets at amortised cost: | |||||||||||||||||||||||||||||
–Loans and advances to customers(2) | — | — | — | 0.2 | 0.7 | 2.3 | 9.1 | — | 0.4 | ||||||||||||||||||||
–Stage 1 | — | — | — | 0.2 | — | — | — | — | 0.1 | ||||||||||||||||||||
–Stage 2 | — | — | — | — | 2.4 | 3.7 | 7.7 | — | 2.8 | ||||||||||||||||||||
–Stage 3 | — | — | — | — | — | — | 11.5 | — | 11.5 | ||||||||||||||||||||
Of which mortgages: | — | — | — | — | — | 2.6 | 3.0 | — | 0.1 | ||||||||||||||||||||
–Stage 1 | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
–Stage 2 | — | — | — | — | — | 3.0 | — | — | 0.7 | ||||||||||||||||||||
–Stage 3 | — | — | — | — | — | — | 5.6 | — | 5.6 | ||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Santander UK risk grade | Loss allowance | |||||||||||||||||||||||||||||||
9 | 8 | 7 | 6 | 5 | 4 | 3 to 1 | Other(1) | Total | ||||||||||||||||||||||||
31 December 2022 | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | ||||||||||||||||||||||
Exposures - On balance sheet | ||||||||||||||||||||||||||||||||
Financial assets at amortised cost: | ||||||||||||||||||||||||||||||||
–Loans and advances to customers⁽²⁾ | 9.5 | 36.5 | 87.1 | 52.7 | 15.2 | 9.3 | 5.4 | 9.0 | (0.9) | 223.8 | ||||||||||||||||||||||
–Stage 1 | 9.5 | 36.2 | 85.4 | 48.4 | 11.1 | 4.0 | 0.5 | 8.6 | (0.1) | 203.6 | ||||||||||||||||||||||
–Stage 2 | — | 0.3 | 1.7 | 4.3 | 4.1 | 5.2 | 2.6 | 0.2 | (0.5) | 17.9 | ||||||||||||||||||||||
–Stage 3 | — | — | — | — | — | 0.1 | 2.3 | 0.2 | (0.3) | 2.3 | ||||||||||||||||||||||
Of which mortgages: | 9.5 | 34.1 | 83.8 | 45.6 | 7.3 | 3.8 | 3.1 | 1.1 | (0.3) | 188.0 | ||||||||||||||||||||||
–Stage 1 | 9.5 | 33.8 | 82.1 | 41.6 | 4.2 | 0.5 | 0.1 | 1.1 | — | 172.9 | ||||||||||||||||||||||
–Stage 2 | — | 0.3 | 1.7 | 4.0 | 3.1 | 3.2 | 1.3 | — | (0.2) | 13.4 | ||||||||||||||||||||||
–Stage 3 | — | — | — | — | — | 0.1 | 1.7 | — | (0.1) | 1.7 | ||||||||||||||||||||||
ECL - On balance sheet | |||||||||||||||||||||||||||||
Financial assets at amortised cost: | |||||||||||||||||||||||||||||
–Loans and advances to customers(2) | — | — | — | — | 0.2 | 0.2 | 0.5 | — | 0.9 | ||||||||||||||||||||
–Stage 1 | — | — | — | — | 0.1 | — | — | — | 0.1 | ||||||||||||||||||||
–Stage 2 | — | — | — | — | 0.1 | 0.2 | 0.2 | — | 0.5 | ||||||||||||||||||||
–Stage 3 | — | — | — | — | — | — | 0.3 | — | 0.3 | ||||||||||||||||||||
Of which mortgages: | — | — | — | — | 0.1 | 0.1 | 0.1 | — | 0.3 | ||||||||||||||||||||
–Stage 1 | — | — | — | — | — | — | |||||||||||||||||||||||
–Stage 2 | — | — | — | — | 0.1 | 0.1 | — | 0.2 | |||||||||||||||||||||
–Stage 3 | — | — | — | — | 0.1 | — | 0.1 | ||||||||||||||||||||||
31 December 2022 | % | % | % | % | % | % | % | % | % | ||||||||||||||||||||
Coverage ratio - On balance sheet | |||||||||||||||||||||||||||||
Financial assets at amortised cost: | |||||||||||||||||||||||||||||
–Loans and advances to customers⁽²⁾ | — | — | — | — | 1.3 | 2.2 | 9.3 | — | 0.4 | ||||||||||||||||||||
–Stage 1 | — | — | — | — | 0.9 | — | — | — | 0.1 | ||||||||||||||||||||
–Stage 2 | — | — | — | — | 2.4 | 3.8 | 7.7 | — | 2.8 | ||||||||||||||||||||
–Stage 3 | — | — | — | — | — | — | 13.0 | — | 13.0 | ||||||||||||||||||||
Of which mortgages: | — | — | — | — | 1.4 | 2.6 | 3.2 | — | 0.2 | ||||||||||||||||||||
–Stage 1 | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
–Stage 2 | — | — | — | — | 3.2 | 3.1 | — | — | 1.5 | ||||||||||||||||||||
–Stage 3 | — | — | — | — | — | — | 5.9 | — | 5.9 | ||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Customer Loans | 6 month Gross write-offs | Loan Loss Allowances | |||||||||||||||||||||||||||
Total | Stage 1 | Stage 2 | Stage 3(3) | ||||||||||||||||||||||||||
30 June 2023 | £bn | £bn | % | £bn | % | £bn | % | £m | £m | ||||||||||||||||||||
Retail Banking | 185.9 | 168.9 | 90.8 | 14.9 | 8.0 | 2.1 | 1.19 | 70 | 490 | ||||||||||||||||||||
– Homes - Mortgages | 178.7 | 163.0 | 91.2 | 13.8 | 7.7 | 1.9 | 1.09 | 6 | 224 | ||||||||||||||||||||
– EDB - Credit Cards | 2.6 | 2.2 | 84.6 | 0.4 | 14.0 | — | 2.48 | 23 | 134 | ||||||||||||||||||||
– EDB - Other(1) | 4.6 | 3.7 | 81.0 | 0.7 | 15.1 | 0.2 | 3.98 | 41 | 132 | ||||||||||||||||||||
Consumer Finance(2) | 5.3 | 4.9 | 92.7 | 0.4 | 6.8 | — | 0.49 | 11 | 73 | ||||||||||||||||||||
CCB | 18.4 | 14.3 | 77.9 | 3.4 | 18.6 | 0.7 | 3.66 | 16 | 379 | ||||||||||||||||||||
Corporate Centre | 1.2 | 1.2 | 99.8 | — | 0.2 | — | 0.09 | — | — | ||||||||||||||||||||
Total Drawn | 210.8 | 189.3 | 89.8 | 18.7 | 8.9 | 2.8 | 1.38 | 97 | 942 | ||||||||||||||||||||
Retail Banking | 24.1 | 23.5 | — | 0.5 | — | 0.1 | — | — | 40 | ||||||||||||||||||||
– Homes - Mortgages | 10.4 | 10.2 | — | 0.1 | — | 0.1 | — | — | 3 | ||||||||||||||||||||
– EDB - Credit Cards | 10.4 | 10.2 | — | 0.2 | — | — | — | — | 12 | ||||||||||||||||||||
– EDB - Other(1) | 3.3 | 3.1 | — | 0.2 | — | — | — | — | 25 | ||||||||||||||||||||
Consumer Finance(2) | 0.5 | 0.5 | — | — | — | — | — | — | — | ||||||||||||||||||||
CCB | 9.1 | 8.6 | — | 0.5 | — | — | — | — | 37 | ||||||||||||||||||||
Corporate Centre | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Total Undrawn | 33.7 | 32.6 | — | 1.0 | — | 0.1 | — | — | 77 | ||||||||||||||||||||
Total | 244.5 | 221.9 | — | 19.7 | — | 2.9 | — | 97 | 1,019 |
Customer Loans | 12 month Gross write-offs | Loan Loss Allowances | |||||||||||||||||||||||||||
Total | Stage 1 | Stage 2 | Stage 3 (3) | ||||||||||||||||||||||||||
31 December 2022 | £bn | £bn | % | £bn | % | £bn | % | £m | £m | ||||||||||||||||||||
Retail Banking | 194.6 | 178.0 | 91.5 | 14.6 | 7.4 | 2.0 | 1.08 | 113 | 504 | ||||||||||||||||||||
– Homes - Mortgages | 187.1 | 171.7 | 91.8 | 13.6 | 7.3 | 1.8 | 0.99 | 3 | 250 | ||||||||||||||||||||
– EDB - Credit Cards | 2.5 | 2.1 | 85.7 | 0.3 | 12.9 | 0.1 | 2.53 | 40 | 120 | ||||||||||||||||||||
– EDB - Other(1) | 5.0 | 4.2 | 82.8 | 0.7 | 13.0 | 0.1 | 4.30 | 70 | 134 | ||||||||||||||||||||
Consumer Finance(2) | 5.4 | 5.0 | 93.0 | 0.4 | 6.5 | — | 0.54 | 19 | 67 | ||||||||||||||||||||
CCB | 18.5 | 14.5 | 78.3 | 3.5 | 18.8 | 0.5 | 3.08 | 24 | 362 | ||||||||||||||||||||
Corporate Centre | 1.2 | 1.2 | 99.6 | — | 0.3 | — | 0.10 | — | — | ||||||||||||||||||||
Total Drawn | 219.7 | 198.7 | 90.4 | 18.5 | 8.4 | 2.5 | 1.24 | 156 | 933 | ||||||||||||||||||||
Retail Banking | 21.8 | 21.2 | — | 0.5 | — | 0.1 | — | — | 42 | ||||||||||||||||||||
– Homes - Mortgages | 8.0 | 7.9 | — | 0.1 | — | — | — | — | 3 | ||||||||||||||||||||
– EDB - Credit Cards | 10.3 | 10.2 | — | 0.1 | — | — | — | — | 10 | ||||||||||||||||||||
– EDB - Other(1) | 3.5 | 3.1 | — | 0.3 | — | 0.1 | — | — | 29 | ||||||||||||||||||||
Consumer Finance(2) | 0.4 | 0.4 | — | — | — | — | — | — | — | ||||||||||||||||||||
CCB | 9.7 | 9.3 | — | 0.4 | — | — | — | — | 32 | ||||||||||||||||||||
Corporate Centre | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Total Undrawn | 31.9 | 30.9 | — | 0.9 | — | 0.1 | — | — | 74 | ||||||||||||||||||||
Total | 251.6 | 229.6 | — | 19.4 | — | 2.6 | — | 156 | 1,007 |
Arrears over 90 days past due | 30 June 2023 | 31 December 2022 | |||||||||
% | % | ||||||||||
Mortgages | 0.68 | 0.62 | |||||||||
Credit Cards | 0.48 | 0.49 | |||||||||
UPL | 0.64 | 0.61 | |||||||||
Overdrafts | 2.26 | 2.24 | |||||||||
Business Banking | 2.81 | 3.47 | |||||||||
Consumer Finance | 0.38 | 0.44 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||
30 June 2023 | £m | £m | £m | £m | ||||||||||
Exposures | ||||||||||||||
On-balance sheet | ||||||||||||||
Retail Banking | 168,884 | 14,870 | 2,150 | 185,904 | ||||||||||
– Homes - Mortgages | 162,945 | 13,808 | 1,936 | 178,689 | ||||||||||
– EDB - Credit Cards | 2,230 | 369 | 38 | 2,637 | ||||||||||
– EDB - Other | 3,709 | 693 | 176 | 4,578 | ||||||||||
Consumer Finance | 4,933 | 360 | 26 | 5,319 | ||||||||||
CCB | 14,312 | 3,424 | 631 | 18,367 | ||||||||||
Corporate Centre | 64,253 | 2 | 1 | 64,256 | ||||||||||
Total on-balance sheet | 252,382 | 18,656 | 2,808 | 273,846 | ||||||||||
Off-balance sheet | ||||||||||||||
Retail Banking(1) | 23,517 | 519 | 55 | 24,091 | ||||||||||
– Homes - Mortgages(1) | 10,230 | 121 | 21 | 10,372 | ||||||||||
– EDB - Credit Cards | 10,172 | 151 | 28 | 10,351 | ||||||||||
– EDB - Other | 3,115 | 247 | 6 | 3,368 | ||||||||||
Consumer Finance | 465 | — | — | 465 | ||||||||||
CCB | 8,663 | 463 | 43 | 9,169 | ||||||||||
Corporate Centre | — | — | — | — | ||||||||||
Total off-balance sheet(2) | 32,645 | 982 | 98 | 33,725 | ||||||||||
Total exposures | 285,027 | 19,638 | 2,906 | 307,571 | ||||||||||
ECL | ||||||||||||||
On-balance sheet | ||||||||||||||
Retail Banking | 51 | 280 | 159 | 490 | ||||||||||
– Homes - Mortgages | 20 | 103 | 101 | 224 | ||||||||||
– EDB - Credit Cards | 15 | 97 | 22 | 134 | ||||||||||
– EDB - Other | 16 | 80 | 36 | 132 | ||||||||||
Consumer Finance | 25 | 30 | 18 | 73 | ||||||||||
CCB | 67 | 144 | 168 | 379 | ||||||||||
Corporate Centre | — | — | — | — | ||||||||||
Total on-balance sheet | 143 | 454 | 345 | 942 | ||||||||||
Off-balance sheet | ||||||||||||||
Retail Banking | 12 | 26 | 2 | 40 | ||||||||||
– Homes - Mortgages | 2 | 1 | — | 3 | ||||||||||
– EDB - Credit Cards | 4 | 7 | 1 | 12 | ||||||||||
– EDB - Other | 6 | 18 | 1 | 25 | ||||||||||
Consumer Finance | — | — | — | — | ||||||||||
CCB | 12 | 13 | 12 | 37 | ||||||||||
Corporate Centre | — | — | — | — | ||||||||||
Total off-balance sheet | 24 | 39 | 14 | 77 | ||||||||||
Total ECL | 167 | 493 | 359 | 1,019 | ||||||||||
Coverage ratio(3) | % | % | % | % | ||||||||||
On-balance sheet | ||||||||||||||
Retail Banking | — | 1.9 | 7.4 | 0.3 | ||||||||||
– Homes - Mortgages | — | 0.7 | 5.2 | 0.1 | ||||||||||
– EDB - Credit Cards | 0.7 | 26.3 | 57.9 | 5.1 | ||||||||||
– EDB - Other | 0.4 | 11.5 | 20.5 | 2.9 | ||||||||||
Consumer Finance | 0.5 | 8.3 | 69.2 | 1.4 | ||||||||||
CCB | 0.5 | 4.2 | 26.6 | 2.1 | ||||||||||
Corporate Centre | — | — | — | — | ||||||||||
Total on-balance sheet | 0.1 | 2.4 | 12.3 | 0.3 | ||||||||||
Off-balance sheet | ||||||||||||||
Retail Banking | 0.1 | 5.0 | 3.6 | 0.2 | ||||||||||
– Homes - Mortgages | — | 0.8 | — | — | ||||||||||
– EDB - Credit Cards | — | 4.6 | 3.6 | 0.1 | ||||||||||
– EDB - Other | 0.2 | 7.3 | 16.7 | 0.7 | ||||||||||
Consumer Finance | — | — | — | — | ||||||||||
CCB | 0.1 | 2.8 | 27.9 | 0.4 | ||||||||||
Corporate Centre | — | — | — | — | ||||||||||
Total off-balance sheet | 0.1 | 4.0 | 14.3 | 0.2 | ||||||||||
Total coverage | 0.1 | 2.5 | 12.4 | 0.3 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||
31 December 2022 | £m | £m | £m | £m | ||||||||||
Exposures | ||||||||||||||
On-balance sheet | ||||||||||||||
Retail Banking | 178,033 | 14,551 | 2,077 | 194,661 | ||||||||||
– Homes - Mortgages | 171,733 | 13,576 | 1,832 | 187,141 | ||||||||||
– EDB - Credit Cards | 2,192 | 329 | 37 | 2,558 | ||||||||||
– EDB - Other | 4,108 | 646 | 208 | 4,962 | ||||||||||
Consumer Finance | 5,005 | 350 | 29 | 5,384 | ||||||||||
CCB | 14,507 | 3,476 | 535 | 18,518 | ||||||||||
Corporate Centre | 62,405 | 3 | 1 | 62,409 | ||||||||||
Total on-balance sheet | 259,950 | 18,380 | 2,642 | 280,972 | ||||||||||
Off-balance sheet | ||||||||||||||
Retail Banking(1) | 21,176 | 490 | 56 | 21,722 | ||||||||||
– Homes - Mortgages(1) | 7,899 | 109 | 21 | 8,029 | ||||||||||
– EDB - Credit Cards | 10,137 | 122 | 29 | 10,288 | ||||||||||
– EDB - Other | 3,140 | 259 | 6 | 3,405 | ||||||||||
Consumer Finance | 356 | — | — | 356 | ||||||||||
CCB | 9,331 | 412 | 37 | 9,780 | ||||||||||
Corporate Centre | — | — | — | — | ||||||||||
Total off-balance sheet(2) | 30,863 | 902 | 93 | 31,858 | ||||||||||
Total exposures | 290,813 | 19,282 | 2,735 | 312,830 | ||||||||||
ECL | ||||||||||||||
On-balance sheet | ||||||||||||||
Retail Banking | 57 | 295 | 152 | 504 | ||||||||||
– Homes - Mortgages | 24 | 131 | 95 | 250 | ||||||||||
– EDB - Credit Cards | 14 | 85 | 21 | 120 | ||||||||||
– EDB - Other | 19 | 79 | 36 | 134 | ||||||||||
Consumer Finance | 19 | 27 | 21 | 67 | ||||||||||
CCB | 69 | 155 | 138 | 362 | ||||||||||
Corporate Centre | — | — | — | — | ||||||||||
Total on-balance sheet | 145 | 477 | 311 | 933 | ||||||||||
Off-balance sheet | ||||||||||||||
Retail Banking | 12 | 28 | 2 | 42 | ||||||||||
– Homes - Mortgages | 2 | 1 | — | 3 | ||||||||||
– EDB - Credit Cards | 3 | 6 | 1 | 10 | ||||||||||
– EDB - Other | 7 | 21 | 1 | 29 | ||||||||||
Consumer Finance | — | — | — | — | ||||||||||
CCB | 14 | 11 | 7 | 32 | ||||||||||
Corporate Centre | — | — | — | — | ||||||||||
Total off-balance sheet | 26 | 39 | 9 | 74 | ||||||||||
Total ECL | 171 | 516 | 320 | 1,007 | ||||||||||
Coverage ratio(3) | % | % | % | % | ||||||||||
On-balance sheet | ||||||||||||||
Retail Banking | — | 2.0 | 7.3 | 0.3 | ||||||||||
– Homes - Mortgages | — | 1.0 | 5.2 | 0.1 | ||||||||||
– EDB - Credit Cards | 0.6 | 25.8 | 56.8 | 4.7 | ||||||||||
– EDB - Other | 0.5 | 12.2 | 17.3 | 2.7 | ||||||||||
Consumer Finance | 0.4 | 7.7 | 72.4 | 1.2 | ||||||||||
CCB | 0.5 | 4.5 | 25.8 | 2.0 | ||||||||||
Corporate Centre | — | — | — | — | ||||||||||
Total on-balance sheet | 0.1 | 2.6 | 11.8 | 0.3 | ||||||||||
Off-balance sheet | ||||||||||||||
Retail Banking | 0.1 | 5.7 | 3.6 | 0.2 | ||||||||||
– Homes - Mortgages | — | 0.9 | — | — | ||||||||||
– EDB - Credit Cards | — | 4.9 | 3.4 | 0.1 | ||||||||||
– EDB - Other | 0.2 | 8.1 | 16.7 | 0.9 | ||||||||||
Consumer Finance | — | — | — | — | ||||||||||
CCB | 0.2 | 2.7 | 18.9 | 0.3 | ||||||||||
Corporate Centre | — | — | — | — | ||||||||||
Total off-balance sheet | 0.1 | 4.3 | 9.7 | 0.2 | ||||||||||
Total coverage | 0.1 | 2.7 | 11.7 | 0.3 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | PD deterioration | Forbearance(1) | Other | 30 DPD | Secured affordability | Unsecured affordability | High risk corporate | Total | |||||||||||||||||||||
Retail Banking Homes - Mortgages | Exposure £m | 7,259 | 494 | 400 | 563 | 5,092 | — | — | 13,808 | ||||||||||||||||||||
ECL £m | 64 | 2 | 5 | 11 | 21 | — | — | 103 | |||||||||||||||||||||
Coverage % | 0.9 | 0.4 | 1.2 | 1.9 | 0.4 | — | — | 0.7 | |||||||||||||||||||||
Retail Banking EDB - Credit Cards | Exposure £m | 248 | — | 25 | 8 | — | 88 | — | 369 | ||||||||||||||||||||
ECL £m | 64 | — | 7 | 4 | — | 22 | — | 97 | |||||||||||||||||||||
Coverage % | 26.2 | 33.0 | 27.2 | 47.3 | — | 24.8 | — | 26.3 | |||||||||||||||||||||
Retail Banking EDB - Other | Exposure £m | 311 | — | 25 | 169 | — | 188 | — | 693 | ||||||||||||||||||||
ECL £m | 33 | — | 7 | 17 | — | 23 | — | 80 | |||||||||||||||||||||
Coverage % | 10.6 | — | 27.9 | 9.8 | — | 12.1 | — | 11.5 | |||||||||||||||||||||
Consumer Finance | Exposure £m | 148 | — | 161 | 23 | 28 | — | — | 360 | ||||||||||||||||||||
ECL £m | 12 | — | 6 | 10 | 2 | — | — | 30 | |||||||||||||||||||||
Coverage % | 8.0 | — | 3.8 | 43.4 | 7.1 | — | — | 8.3 | |||||||||||||||||||||
CCB | Exposure £m | 1,892 | 70 | 508 | 120 | — | — | 834 | 3,424 | ||||||||||||||||||||
ECL £m | 76 | 2 | 17 | 3 | — | — | 46 | 144 | |||||||||||||||||||||
Coverage % | 4.0 | 2.8 | 3.4 | 2.3 | — | — | 5.5 | 4.2 | |||||||||||||||||||||
Corporate Centre | Exposure £m | — | — | — | 2 | — | — | — | 2 | ||||||||||||||||||||
ECL £m | — | — | — | — | — | — | — | — | |||||||||||||||||||||
Coverage % | — | — | — | — | — | — | — | — | |||||||||||||||||||||
Total Drawn | Exposure £m | 9,858 | 564 | 1,119 | 885 | 5,120 | 276 | 834 | 18,656 | ||||||||||||||||||||
ECL £m | 249 | 4 | 42 | 45 | 23 | 45 | 46 | 454 | |||||||||||||||||||||
Coverage % | 2.5 | 0.7 | 3.8 | 4.9 | 0.4 | 16.1 | 5.5 | 2.4 | |||||||||||||||||||||
Undrawn | ECL £m | 24 | — | 5 | 2 | — | 4 | 4 | 39 | ||||||||||||||||||||
Total Reported | Exposure £m | 10,725 | 564 | 1,215 | 932 | 5,092 | 276 | 834 | 19,638 | ||||||||||||||||||||
ECL £m | 273 | 4 | 47 | 47 | 23 | 49 | 50 | 493 | |||||||||||||||||||||
31 December 2022 | PD deterioration | Forbearance(1) | Other | 30 DPD | Mortgage affordability | Retail unsecured affordability | High risk corporate | Total | |||||||||||||||||||||
Retail Banking Homes - Mortgages | Exposure £m | 7,310 | 449 | 393 | 463 | 4,961 | — | — | 13,576 | ||||||||||||||||||||
ECL £m | 85 | 2 | 7 | 10 | 27 | — | — | 131 | |||||||||||||||||||||
Coverage % | 1.2 | 0.4 | 1.8 | 2.2 | 0.5 | — | — | 1.0 | |||||||||||||||||||||
Retail Banking EDB - Credit Cards | Exposure £m | 240 | — | 22 | 8 | — | 59 | — | 329 | ||||||||||||||||||||
ECL £m | 63 | — | 4 | 4 | — | 14 | — | 85 | |||||||||||||||||||||
Coverage % | 26.3 | — | 18.2 | 50.0 | — | 23.7 | — | 25.8 | |||||||||||||||||||||
Retail Banking EDB - Other | Exposure £m | 303 | — | 26 | 178 | — | 139 | — | 646 | ||||||||||||||||||||
ECL £m | 42 | — | 6 | 14 | — | 17 | — | 79 | |||||||||||||||||||||
Coverage % | 13.9 | — | 23.1 | 7.9 | — | 12.2 | — | 12.2 | |||||||||||||||||||||
Consumer Finance | Exposure £m | 159 | — | 164 | 27 | — | — | — | 350 | ||||||||||||||||||||
ECL £m | 12 | — | 5 | 10 | — | — | — | 27 | |||||||||||||||||||||
Coverage % | 7.5 | — | 3.0 | 37.0 | — | — | — | 7.7 | |||||||||||||||||||||
CCB | Exposure £m | 1,548 | 64 | 684 | 214 | — | — | 966 | 3,476 | ||||||||||||||||||||
ECL £m | 81 | 4 | 1 | 10 | — | — | 59 | 155 | |||||||||||||||||||||
Coverage % | 5.2 | 6.3 | 0.1 | 4.7 | — | — | 6.1 | 4.5 | |||||||||||||||||||||
Corporate Centre | Exposure £m | — | — | — | 3 | — | — | — | 3 | ||||||||||||||||||||
ECL £m | — | — | — | — | — | — | — | — | |||||||||||||||||||||
Coverage % | — | — | — | — | — | — | — | — | |||||||||||||||||||||
Total Drawn | Exposure £m | 9,560 | 513 | 1,289 | 893 | 4,961 | 198 | 966 | 18,380 | ||||||||||||||||||||
ECL £m | 283 | 6 | 23 | 48 | 27 | 31 | 59 | 477 | |||||||||||||||||||||
Coverage % | 3.0 | 1.2 | 1.8 | 5.4 | 0.5 | 15.7 | 6.1 | 2.6 | |||||||||||||||||||||
Undrawn | ECL £m | 19 | — | 8 | 6 | — | 4 | 2 | 39 | ||||||||||||||||||||
Total Reported | Exposure £m | 10,323 | 625 | 1,271 | 937 | 4,961 | 199 | 966 | 19,282 | ||||||||||||||||||||
ECL £m | 302 | 6 | 31 | 54 | 27 | 35 | 61 | 516 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | ||||||||||||||||||||||
Exposure | ECL | Coverage | Exposure | ECL | Coverage | ||||||||||||||||||
£m | £m | % | £m | £m | % | ||||||||||||||||||
Stage 2 not in cure period | 13,283 | 408 | 3.1 | 13,156 | 439 | 3.3 | |||||||||||||||||
Stage 2 in cure period (for transfer to Stage 1) | 6,355 | 85 | 1.3 | 6,126 | 77 | 1.3 | |||||||||||||||||
19,638 | 493 | 2.5 | 19,282 | 516 | 2.7 |
30 June 2023 | 31 December 2022 | ||||||||||||||||||||||
Exposure | ECL | Coverage | Exposure | ECL | Coverage | ||||||||||||||||||
£m | £m | % | £m | £m | % | ||||||||||||||||||
Stage 3 not in cure period | 2,551 | 317 | 12.4 | 2,421 | 286 | 11.8 | |||||||||||||||||
Stage 3 in cure period (for transfer to Stage 2) | 355 | 42 | 11.8 | 314 | 34 | 10.8 | |||||||||||||||||
2,906 | 359 | 12.4 | 2,735 | 320 | 11.7 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
On-balance sheet | Off-balance sheet | ||||||||||||||||
Exposures | Loss allowance | Net carrying amount | Exposures | Loss allowance | |||||||||||||
30 June 2023 | £m | £m | £m | £m | £m | ||||||||||||
Retail Banking | 185,904 | 490 | 185,414 | 24,091 | 40 | ||||||||||||
–Homes - Mortgages(1) | 178,689 | 224 | 178,465 | 10,372 | 3 | ||||||||||||
–EDB - Credit Cards(2) | 2,637 | 134 | 2,503 | 10,351 | 12 | ||||||||||||
–EDB - Other (3) | 4,578 | 132 | 4,446 | 3,368 | 25 | ||||||||||||
Consumer Finance | 5,319 | 73 | 5,246 | 465 | — | ||||||||||||
Corporate & Commercial Banking | 18,367 | 379 | 17,988 | 9,169 | 37 | ||||||||||||
Corporate Centre | 64,256 | — | 64,256 | — | — | ||||||||||||
Total exposures presented in Credit Quality tables | 273,846 | 942 | 272,904 | 33,725 | 77 | ||||||||||||
Joint ventures | 4,390 | ||||||||||||||||
Other items | 763 | ||||||||||||||||
Adjusted net carrying amount | 278,057 | ||||||||||||||||
Assets classified at FVTPL | 3,206 | ||||||||||||||||
Non-financial assets(3) | 3,078 | ||||||||||||||||
Total assets per the Consolidated Balance Sheet | 284,341 | ||||||||||||||||
31 December 2022 | |||||||||||||||||
Retail Banking | 194,661 | 504 | 194,157 | 21,722 | 42 | ||||||||||||
–Homes - Mortgages(1) | 187,141 | 250 | 186,891 | 8,029 | 3 | ||||||||||||
–EDB - Credit Cards(2) | 2,558 | 120 | 2,438 | 10,288 | 10 | ||||||||||||
–EDB - Other(3) | 4,962 | 134 | 4,828 | 3,405 | 29 | ||||||||||||
Consumer Finance | 5,384 | 67 | 5,317 | 356 | — | ||||||||||||
Corporate & Commercial Banking | 18,518 | 362 | 18,156 | 9,780 | 32 | ||||||||||||
Corporate Centre | 62,409 | — | 62,409 | — | — | ||||||||||||
Total exposures presented in Credit Quality tables | 280,972 | 933 | 280,039 | 31,858 | 74 | ||||||||||||
Joint ventures | 4,165 | ||||||||||||||||
Other items | 904 | ||||||||||||||||
Adjusted net carrying amount | 285,108 | ||||||||||||||||
Assets classified at FVTPL | 2,873 | ||||||||||||||||
Non-financial assets(3) | 4,262 | ||||||||||||||||
Total assets per the Consolidated Balance Sheet | 292,243 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||||||||||||
Exposures(1) | ECL | Exposures(1) | ECL | Exposures(1) | ECL | Exposures(1) | ECL | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | |||||||||||||||||||
At 1 January 2023 | 290,813 | 171 | 19,282 | 516 | 2,735 | 320 | 312,830 | 1,007 | ||||||||||||||||||
Transfers from Stage 1 to Stage 2(3) | (6,132) | (16) | 6,132 | 16 | — | — | — | — | ||||||||||||||||||
Transfers from Stage 2 to Stage 1(3) | 4,186 | 79 | (4,186) | (79) | — | — | — | — | ||||||||||||||||||
Transfers to Stage 3(3) | (244) | (3) | (654) | (44) | 898 | 47 | — | — | ||||||||||||||||||
Transfers from Stage 3(3) | 11 | — | 225 | 14 | (236) | (14) | — | — | ||||||||||||||||||
Transfers of financial instruments | (2,179) | 60 | 1,517 | (93) | 662 | 33 | — | — | ||||||||||||||||||
Net ECL remeasurement on stage transfer(4) | — | (72) | — | 136 | — | 61 | — | 125 | ||||||||||||||||||
Change in economic scenarios(2) | — | 9 | — | (37) | — | 15 | — | (13) | ||||||||||||||||||
Changes to model | — | — | — | — | — | — | — | — | ||||||||||||||||||
New lending and assets purchased(5) | 12,301 | 15 | 151 | 15 | 11 | 3 | 12,463 | 33 | ||||||||||||||||||
Redemptions, repayments and assets sold(7) | (17,872) | (18) | (1,651) | (33) | (502) | (34) | (20,025) | (85) | ||||||||||||||||||
Changes in risk parameters and other movements(6) | 1,964 | 2 | 339 | (11) | 178 | 58 | 2,481 | 49 | ||||||||||||||||||
Assets written off(7) | — | — | — | — | (178) | (97) | (178) | (97) | ||||||||||||||||||
At 30 June 2023 | 285,027 | 167 | 19,638 | 493 | 2,906 | 359 | 307,571 | 1,019 | ||||||||||||||||||
Net movement in the period | (5,786) | (4) | 356 | (23) | 171 | 39 | (5,259) | 12 | ||||||||||||||||||
ECL charge/(release) to the Income Statement | (4) | (23) | 136 | 109 | ||||||||||||||||||||||
Less: Discount unwind | — | — | (10) | (10) | ||||||||||||||||||||||
Less: Recoveries net of collection costs | — | — | 6 | 6 | ||||||||||||||||||||||
Total ECL charge/(release) to the Income Statement | (4) | (23) | 132 | 105 | ||||||||||||||||||||||
At 1 January 2022 | 298,285 | 133 | 18,013 | 330 | 3,021 | 403 | 319,319 | 866 | ||||||||||||||||||
Transfers from Stage 1 to Stage 2(3) | (5,634) | (15) | 5,634 | 15 | — | — | — | — | ||||||||||||||||||
Transfers from Stage 2 to Stage 1(3) | 5,884 | 66 | (5,884) | (66) | — | — | — | — | ||||||||||||||||||
Transfers to Stage 3(3) | (283) | (2) | (513) | (19) | 796 | 21 | — | — | ||||||||||||||||||
Transfers from Stage 3(3) | 8 | — | 708 | 150 | (716) | (150) | — | — | ||||||||||||||||||
Transfers of financial instruments | (25) | 49 | (55) | 80 | 80 | (129) | — | — | ||||||||||||||||||
Net remeasurement of ECL on stage transfer(4) | — | (42) | — | 100 | — | 52 | — | 110 | ||||||||||||||||||
Change in economic scenarios(2) | — | 1 | — | 28 | — | 3 | — | 32 | ||||||||||||||||||
Changes to model | — | — | — | — | — | — | — | — | ||||||||||||||||||
New lending and assets purchased(5) | 27,650 | 25 | 234 | 35 | 32 | 12 | 27,916 | 72 | ||||||||||||||||||
Redemptions, repayments and assets sold(7) | (29,188) | (20) | (1,586) | (34) | (586) | (47) | (31,360) | (101) | ||||||||||||||||||
Changes in risk parameters and other movements(6) | (926) | (1) | 171 | (32) | 279 | 47 | (476) | 14 | ||||||||||||||||||
Assets written off (7) | — | — | — | — | (186) | (70) | (186) | (70) | ||||||||||||||||||
At 30 June 2022 | 295,796 | 145 | 16,777 | 507 | 2,640 | 271 | 315,213 | 923 | ||||||||||||||||||
Net movement in the period | (2,489) | 12 | (1,236) | 177 | (381) | (132) | (4,106) | 57 | ||||||||||||||||||
ECL charge/(release) to the Income Statement | 12 | 177 | (62) | 127 | ||||||||||||||||||||||
Less: Discount unwind | — | — | (6) | (6) | ||||||||||||||||||||||
Less: Recoveries net of collection costs | — | — | (3) | (3) | ||||||||||||||||||||||
Total ECL charge/(release) to the Income Statement | 12 | 177 | (71) | 118 | ||||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Stock | New business | ||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | 30 June 2023 | 30 June 2022 | ||||||||||||||||||||||||||||||||
£m | % | £m | % | £m | % | £m | % | ||||||||||||||||||||||||||||
Home movers(1) | 74,203 | 42 | 77,708 | 41 | 1,753 | 43 | 6,178 | 34 | |||||||||||||||||||||||||||
Remortgagers(2) | 50,738 | 28 | 53,936 | 29 | 1,163 | 29 | 6,234 | 34 | |||||||||||||||||||||||||||
First-time buyers | 37,627 | 21 | 38,698 | 21 | 1,028 | 26 | 3,607 | 20 | |||||||||||||||||||||||||||
Buy-to-let | 16,121 | 9 | 16,799 | 9 | 70 | 2 | 2,088 | 12 | |||||||||||||||||||||||||||
178,689 | 100 | 187,141 | 100 | 4,014 | 100 | 18,107 | 100 |
30 June 2023 | 31 December 2022 | ||||||||||||||||
£m | % | £m | % | ||||||||||||||
Fixed rate | 158,314 | 89 | 166,281 | 89 | |||||||||||||
Of which maturing: | |||||||||||||||||
–< 12 months | 41,128 | 23 | 39,123 | 21 | |||||||||||||
–Later than 1 year but no later than 3 years | 58,772 | 33 | 39,056 | 21 | |||||||||||||
–Later than 3 years but no later than 4 years | 32,123 | 18 | 24,584 | 13 | |||||||||||||
–Later than 4 years but no later than 5 years | 21,658 | 12 | 25,290 | 14 | |||||||||||||
–Later than 5 years | 4,633 | 3 | 38,228 | 20 | |||||||||||||
Variable rate | 13,403 | 7 | 12,511 | 7 | |||||||||||||
Standard Variable Rate (SVR) | 4,742 | 3 | 5,682 | 3 | |||||||||||||
Follow on Rate (FoR) | 2,230 | 1 | 2,667 | 1 | |||||||||||||
178,689 | 100 | 187,141 | 100 |
Stock | New business | ||||||||||||||||
30 June 2023 | 31 December 2022 | 30 June 2023 | 30 June 2022 | ||||||||||||||
Region | £bn | £bn | £bn | £bn | |||||||||||||
London | 45.6 | 47.8 | 1.0 | 4.5 | |||||||||||||
Midlands and East Anglia | 25.0 | 26.0 | 0.6 | 2.8 | |||||||||||||
North | 23.6 | 24.8 | 0.5 | 2.4 | |||||||||||||
Northern Ireland | 2.7 | 2.9 | — | 0.1 | |||||||||||||
Scotland | 6.5 | 6.8 | 0.2 | 0.6 | |||||||||||||
South East excluding London | 56.7 | 59.3 | 1.3 | 5.7 | |||||||||||||
South West, Wales and other | 18.6 | 19.5 | 0.4 | 2.0 | |||||||||||||
178.7 | 187.1 | 4.0 | 18.1 | ||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Mortgage loan size | 30 June 2023 | 31 December 2022 | |||||||||
>£1.0m | 2 | % | 2 | % | |||||||
£0.5m to £1.0m | 10 | % | 10 | % | |||||||
£0.25m to £0.5m | 31 | % | 31 | % | |||||||
<£0.25m | 57 | % | 57 | % | |||||||
Average loan size (stock) | £185k | £184k | |||||||||
Average loan size (new business) | £225k | £237k |
30 June 2023 | 31 December 2022 | ||||||||||||||||||||||||||||||||||
Stock | Stage 3 | New | Stock | Stage 3 | New | ||||||||||||||||||||||||||||||
Total | ECL | Total | ECL | Business | Total | ECL | Total | ECL | Business | ||||||||||||||||||||||||||
LTV | £m | £m | £m | £m | £m | £m | £m | £m | £m | £m | |||||||||||||||||||||||||
Up to 50% | 82,325 | 31 | 1,114 | 13 | 921 | 88,841 | 37 | 1,116 | 14 | 4,890 | |||||||||||||||||||||||||
>50-60% | 34,261 | 22 | 324 | 10 | 548 | 36,356 | 29 | 284 | 11 | 4,014 | |||||||||||||||||||||||||
>60-70% | 32,638 | 35 | 224 | 15 | 648 | 34,350 | 50 | 197 | 16 | 6,104 | |||||||||||||||||||||||||
>70-80% | 18,738 | 44 | 123 | 18 | 867 | 17,977 | 46 | 110 | 15 | 10,094 | |||||||||||||||||||||||||
>80-90% | 8,176 | 32 | 59 | 13 | 674 | 7,369 | 29 | 42 | 9 | 6,002 | |||||||||||||||||||||||||
>90-100% | 2,118 | 19 | 35 | 10 | 350 | 1,876 | 17 | 32 | 9 | 2,999 | |||||||||||||||||||||||||
>100% | 433 | 44 | 57 | 22 | 6 | 372 | 45 | 52 | 21 | 24 | |||||||||||||||||||||||||
178,689 | 227 | 1,936 | 101 | 4,014 | 187,141 | 253 | 1,833 | 95 | 34,127 | ||||||||||||||||||||||||||
Collateral value (1) | 178,631 | 1,926 | 4,014 | 187,093 | 1,824 | 34,126 | |||||||||||||||||||||||||||||
% | % | % | % | % | % | ||||||||||||||||||||||||||||||
Average LTV - Balance weighted(2) | 51 | 48 | 65 | 50 | 47 | 69 |
30 June 2023 | 31 December 2022 | ||||||||||
£m | £m | ||||||||||
Mortgage loans and advances to customers | 178,689 | 187,141 | |||||||||
of which: | |||||||||||
– Stage 1 | 162,945 | 171,733 | |||||||||
– Stage 2 | 13,808 | 13,576 | |||||||||
– Stage 3 | 1,936 | 1,832 | |||||||||
Loss allowances(1) | 227 | 253 |
% | % | ||||||||||
Stage 1 ratio(2) | 91.19 | 91.76 | |||||||||
Stage 2 ratio(2) | 7.73 | 7.25 | |||||||||
Stage 3 ratio | 1.09 | 0.99 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Stage 1 | Stage 2 | Stage 3 | Total | |||||||||||||||||||||||
Exposures(1) | ECL | Exposures(1) | ECL | Exposures(1) | ECL | Exposures(1) | ECL | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | |||||||||||||||||||
At 1 January 2023 | 179,632 | 26 | 13,685 | 132 | 1,853 | 95 | 195,170 | 253 | ||||||||||||||||||
Transfers from Stage 1 to Stage 2(3) | (4,444) | (2) | 4,444 | 2 | — | — | — | — | ||||||||||||||||||
Transfers from Stage 2 to Stage 1(3) | 3,336 | 19 | (3,336) | (19) | — | — | — | — | ||||||||||||||||||
Transfers to Stage 3(3) | (142) | (2) | (392) | (10) | 534 | 12 | — | — | ||||||||||||||||||
Transfers from Stage 3(3) | 4 | — | 190 | 5 | (194) | (5) | — | — | ||||||||||||||||||
Transfers of financial instruments | (1,246) | 15 | 906 | (22) | 340 | 7 | — | — | ||||||||||||||||||
Net ECL remeasurement on stage transfer(4) | — | (17) | — | 22 | — | 9 | — | 14 | ||||||||||||||||||
Change in economic scenarios(2) | — | (4) | — | (18) | — | 2 | — | (20) | ||||||||||||||||||
New lending and assets purchased(5) | 4,488 | 2 | 21 | 1 | — | — | 4,509 | 3 | ||||||||||||||||||
Redemptions, repayments and assets sold(7) | (12,245) | (3) | (833) | (6) | (231) | (8) | (13,309) | (17) | ||||||||||||||||||
Changes in risk parameters and other movements(6) | 2,546 | 3 | 150 | (5) | 19 | 2 | 2,715 | — | ||||||||||||||||||
Assets written off (7) | — | — | — | — | (24) | (6) | (24) | (6) | ||||||||||||||||||
At 30 June 2023 | 173,175 | 22 | 13,929 | 104 | 1,957 | 101 | 189,061 | 227 | ||||||||||||||||||
Net movement in the period | (6,457) | (4) | 244 | (28) | 104 | 6 | (6,109) | (26) | ||||||||||||||||||
ECL charge/(release) to the Income Statement | (4) | (28) | 12 | (20) | ||||||||||||||||||||||
Less: Discount unwind | — | — | (1) | (1) | ||||||||||||||||||||||
Less: Recoveries net of collection costs | — | — | (1) | (1) | ||||||||||||||||||||||
Total ECL charge/(release) to the Income Statement | (4) | (28) | 10 | (22) | ||||||||||||||||||||||
At 1 January 2022 | 180,232 | 14 | 11,199 | 88 | 1,816 | 89 | 193,247 | 191 | ||||||||||||||||||
Transfers from Stage 1 to Stage 2(3) | (3,968) | (1) | 3,968 | 1 | — | — | — | — | ||||||||||||||||||
Transfers from Stage 2 to Stage 1(3) | 2,560 | 7 | (2,560) | (7) | — | — | — | — | ||||||||||||||||||
Transfers to Stage 3(3) | (127) | (1) | (340) | (4) | 467 | 5 | — | — | ||||||||||||||||||
Transfers from Stage 3(3) | 3 | — | 197 | 7 | (200) | (7) | — | — | ||||||||||||||||||
Transfers of financial instruments | (1,532) | 5 | 1,265 | (3) | 267 | (2) | — | — | ||||||||||||||||||
Net ECL remeasurement on stage transfer(4) | — | (6) | — | 19 | — | 4 | — | 17 | ||||||||||||||||||
Change in economic scenarios(2) | — | (1) | — | (17) | — | (2) | — | (20) | ||||||||||||||||||
New lending and assets purchased(5) | 18,880 | 5 | 42 | 2 | — | — | 18,922 | 7 | ||||||||||||||||||
Redemptions, repayments and assets sold(7) | (11,136) | (2) | (766) | (2) | (209) | (6) | (12,111) | (10) | ||||||||||||||||||
Changes in risk parameters and other movements(6) | (434) | 4 | 166 | 16 | 13 | 1 | (255) | 21 | ||||||||||||||||||
Assets written off(7) | — | — | — | — | (3) | (1) | (3) | (1) | ||||||||||||||||||
At 30 June 2022 | 186,010 | 19 | 11,906 | 103 | 1,884 | 83 | 199,800 | 205 | ||||||||||||||||||
Net movement in the period | 5,778 | 5 | 707 | 15 | 68 | (6) | 6,553 | 14 | ||||||||||||||||||
ECL charge/(release) to the Income Statement | 5 | 15 | (5) | 15 | ||||||||||||||||||||||
Less: Discount unwind | — | — | (1) | (1) | ||||||||||||||||||||||
Less: Recoveries net of collection costs | — | — | (1) | (1) | ||||||||||||||||||||||
Total ECL charge/(release) to the Income Statement | 5 | 15 | (7) | 13 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Portfolio of particular interest(1) | |||||||||||||||||||||||
Total | Interest-only | Part interest-only, part repayment (2) | Flexible | LTV >100% | Buy-to-let | Other portfolio | |||||||||||||||||
30 June 2023 | £m | £m | £m | £m | £m | £m | £m | ||||||||||||||||
Mortgage portfolio | 178,689 | 39,151 | 13,027 | 5,999 | 433 | 16,121 | 123,783 | ||||||||||||||||
–Stage 1 | 162,945 | 34,019 | 11,627 | 4,955 | 275 | 15,160 | 114,847 | ||||||||||||||||
–Stage 2 | 13,808 | 4,170 | 1,175 | 808 | 101 | 917 | 8,225 | ||||||||||||||||
–Stage 3 | 1,936 | 962 | 225 | 236 | 57 | 44 | 711 | ||||||||||||||||
Stage 3 ratio | 1.09 | % | 2.48 | % | 1.74 | % | 4.26 | % | 13.11 | % | 0.27 | % | 0.57 | % | |||||||||
Properties in possession | 36 | 18 | 5 | 3 | 6 | 2 | 11 | ||||||||||||||||
Balance weighted LTV (indexed) | 51 | % | 48 | % | 51 | % | 37 | % | 117 | % | 59 | % | 52 | % | |||||||||
31 December 2022 | |||||||||||||||||||||||
Mortgage portfolio | 187,141 | 41,098 | 13,759 | 6,765 | 372 | 16,799 | 129,299 | ||||||||||||||||
–Stage 1 | 171,733 | 35,957 | 12,380 | 5,713 | 218 | 15,884 | 120,683 | ||||||||||||||||
–Stage 2 | 13,576 | 4,265 | 1,161 | 839 | 102 | 876 | 7,916 | ||||||||||||||||
–Stage 3 | 1,832 | 876 | 218 | 213 | 52 | 39 | 700 | ||||||||||||||||
Stage 3 ratio | 0.99 | % | 2.15 | % | 1.60 | % | 3.45 | % | 13.91 | % | 0.23 | % | 0.54 | % | |||||||||
Properties in possession | 47 | 18 | 8 | 3 | 7 | 1 | 16 | ||||||||||||||||
Balance weighted LTV (indexed) | 50 | % | 47 | % | 49 | % | 36 | % | 117 | % | 58 | % | 52 | % |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Business banking | Other unsecured | |||||||||||||||||||
Personal loans | Credit cards | Overdrafts | Total other unsecured | Total | ||||||||||||||||
30 June 2023 | £m | £m | £m | £m | £m | £m | ||||||||||||||
Loans and advances to customers | 2,149 | 1,994 | 2,637 | 435 | 5,066 | 7,215 | ||||||||||||||
of which: | ||||||||||||||||||||
–Stage 1 | 1,895 | 1,684 | 2,230 | 130 | 4,044 | 5,939 | ||||||||||||||
–Stage 2 | 124 | 287 | 369 | 282 | 938 | 1,062 | ||||||||||||||
–Stage 3 | 130 | 23 | 38 | 23 | 84 | 214 | ||||||||||||||
Loss allowances(1) | 16 | 69 | 146 | 72 | 287 | 303 | ||||||||||||||
Stage 3 undrawn exposures | 2 | 32 | 34 | |||||||||||||||||
Stage 3 ratio | 6.14 | % | 2.28 | % | 3.43 | % | ||||||||||||||
Gross write-offs (6 months) | 6 | 58 | 64 | |||||||||||||||||
31 December 2022 | ||||||||||||||||||||
Loans and advances to customers | 2,519 | 1,982 | 2,558 | 461 | 5,001 | 7,520 | ||||||||||||||
of which: | ||||||||||||||||||||
–Stage 1 | 2,223 | 1,730 | 2,192 | 155 | 4,077 | 6,300 | ||||||||||||||
–Stage 2 | 133 | 231 | 329 | 282 | 842 | 975 | ||||||||||||||
–Stage 3 | 163 | 21 | 37 | 24 | 82 | 245 | ||||||||||||||
Loss allowances(1) | 19 | 62 | 130 | 82 | 274 | 293 | ||||||||||||||
Stage 3 undrawn exposures | 3 | 32 | 35 | |||||||||||||||||
Stage 3 ratio | 6.58 | % | 2.27 | % | 3.71 | % | ||||||||||||||
Gross write-offs (12 months) | 11 | 99 | 110 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | ||||||||||
£m | £m | ||||||||||
Loans and advances to customers | 5,319 | 5,384 | |||||||||
of which: | |||||||||||
–Stage 1 | 4,933 | 5,005 | |||||||||
–Stage 2 | 360 | 350 | |||||||||
–Stage 3 | 26 | 29 | |||||||||
Loss allowances(1) | 73 | 67 | |||||||||
Stage 3 ratio | 0.49 | % | 0.54 | % | |||||||
Gross write offs | 11 | 19 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Santander UK risk grade | |||||||||||||||||||||||||||||
9 | 8 | 7 | 6 | 5 | 4 | 3 to 1 | Other(1) | Total | |||||||||||||||||||||
30 June 2023 | £m | £m | £m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||
SME and mid corporate | — | 264 | 973 | 3,063 | 3,598 | 4,010 | 1,499 | 136 | 13,543 | ||||||||||||||||||||
Commercial Real Estate | — | 2 | 215 | 1,683 | 2,240 | 862 | 173 | 2 | 5,177 | ||||||||||||||||||||
Social Housing | 136 | 3,722 | 4,114 | 7 | — | — | — | — | 7,979 | ||||||||||||||||||||
136 | 3,988 | 5,302 | 4,753 | 5,838 | 4,872 | 1,672 | 138 | 26,699 | |||||||||||||||||||||
Of which: | |||||||||||||||||||||||||||||
Stage 1 | 132 | 3,911 | 5,301 | 4,669 | 5,099 | 2,704 | 186 | 137 | 22,139 | ||||||||||||||||||||
Stage 2 | 4 | 77 | 1 | 84 | 739 | 2,168 | 813 | 1 | 3,887 | ||||||||||||||||||||
Stage 3 | — | — | — | — | — | — | 673 | — | 673 | ||||||||||||||||||||
31 December 2022 | |||||||||||||||||||||||||||||
SME and mid corporate | — | 336 | 923 | 2,341 | 3,299 | 5,327 | 1,791 | 106 | 14,123 | ||||||||||||||||||||
Commercial Real Estate | — | 2 | 111 | 2,044 | 2,128 | 936 | 185 | 1 | 5,407 | ||||||||||||||||||||
Social Housing | 44 | 4,028 | 3,956 | 6 | — | — | — | 1 | 8,035 | ||||||||||||||||||||
44 | 4,366 | 4,990 | 4,391 | 5,427 | 6,263 | 1,976 | 108 | 27,565 | |||||||||||||||||||||
Of which: | |||||||||||||||||||||||||||||
Stage 1 | 39 | 4,364 | 4,944 | 4,202 | 4,773 | 4,289 | 386 | 108 | 23,105 | ||||||||||||||||||||
Stage 2 | 5 | 2 | 46 | 189 | 654 | 1,974 | 1,018 | — | 3,888 | ||||||||||||||||||||
Stage 3 | — | — | — | — | — | — | 572 | — | 572 |
30 June 2023 | Committed exposure | |||||||||||||||||||
Watchlist | ||||||||||||||||||||
Fully performing | Enhanced monitoring | Proactive management | Stage 3 | Total (1) | Loss allowances | |||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||
SME and mid corporate | 10,995 | 393 | 1,545 | 610 | 13,543 | 380 | ||||||||||||||
Commercial Real Estate | 4,374 | 93 | 647 | 63 | 5,177 | 36 | ||||||||||||||
Social Housing | 7,801 | — | 178 | — | 7,979 | — | ||||||||||||||
23,170 | 486 | 2,370 | 673 | 26,699 | 416 |
31 December 2022 | ||||||||||||||||||||
SME and mid corporate | 11,796 | 431 | 1,383 | 513 | 14,123 | 355 | ||||||||||||||
Commercial Real Estate | 4,765 | 103 | 480 | 59 | 5,407 | 38 | ||||||||||||||
Social Housing | 7,979 | 46 | 10 | — | 8,035 | 1 | ||||||||||||||
24,540 | 580 | 1,873 | 572 | 27,565 | 394 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Santander UK risk grade | |||||||||||||||||||||||||||||
9 | 8 | 7 | 6 | 5 | 4 | 3 to 1 | Other(1) | Total | |||||||||||||||||||||
30 June 2023 | £m | £m | £m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||
Sovereign and Supranational | 48,338 | 1,895 | — | — | — | — | — | — | 50,233 | ||||||||||||||||||||
Structured Products | 170 | 1,470 | 787 | — | — | — | — | — | 2,427 | ||||||||||||||||||||
Financial Institutions | 1,262 | 667 | 436 | 7 | — | — | — | — | 2,372 | ||||||||||||||||||||
Crown Dependencies | — | — | — | — | — | — | — | 1,206 | 1,206 | ||||||||||||||||||||
49,770 | 4,032 | 1,223 | 7 | — | — | — | 1,206 | 56,238 | |||||||||||||||||||||
Of which: | |||||||||||||||||||||||||||||
Stage 1 | 49,770 | 4,032 | 1,223 | 7 | — | — | — | 1,203 | 56,235 | ||||||||||||||||||||
Stage 2 | — | — | — | — | — | — | — | 2 | 2 | ||||||||||||||||||||
Stage 3 | — | — | — | — | — | — | — | 1 | 1 | ||||||||||||||||||||
31 December 2022 | |||||||||||||||||||||||||||||
Sovereign and Supranational | 53,910 | 1,077 | — | — | — | — | — | — | 54,987 | ||||||||||||||||||||
Structured Products | 136 | 1,162 | 875 | — | — | — | — | — | 2,173 | ||||||||||||||||||||
Financial Institutions | 1,191 | 676 | 635 | 26 | — | — | — | — | 2,528 | ||||||||||||||||||||
Crown Dependencies | — | — | — | — | — | — | — | 1,141 | 1,141 | ||||||||||||||||||||
55,237 | 2,915 | 1,510 | 26 | — | — | — | 1,141 | 60,829 | |||||||||||||||||||||
Of which: | |||||||||||||||||||||||||||||
Stage 1 | 55,237 | 2,915 | 1,510 | 26 | — | — | — | 1,137 | 60,825 | ||||||||||||||||||||
Stage 2 | — | — | — | — | — | — | — | 3 | 3 | ||||||||||||||||||||
Stage 3 | — | — | — | — | — | — | — | 1 | 1 |
30 June 2023 | 31 December 2022 | ||||||||||||||||||||||||||||||||||
UK | Europe | US | Rest of World | Total | UK | Europe | US | Rest of World | Total | ||||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||||||
Sovereign and Supranational | 45,367 | 2,062 | — | 2,804 | 50,233 | 50,806 | 1,886 | 83 | 2,212 | 54,987 | |||||||||||||||||||||||||
Structured Products | 1,430 | 243 | — | 754 | 2,427 | 1,379 | 422 | 4 | 368 | 2,173 | |||||||||||||||||||||||||
Financial Institutions | 892 | 1,004 | 282 | 194 | 2,372 | 1,075 | 1,036 | 230 | 187 | 2,528 | |||||||||||||||||||||||||
Crown Dependencies | — | — | — | 1,206 | 1,206 | — | — | — | 1,141 | 1,141 | |||||||||||||||||||||||||
47,689 | 3,309 | 282 | 4,958 | 56,238 | 53,260 | 3,344 | 317 | 3,908 | 60,829 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Overview Market risk comprises banking market risk and trading market risk. Market risk management In H123, there were no significant changes in the way we manage market risk as described in the 2022 Annual Report. Market risk review In this section, we analyse our key banking and trading market risk metrics. | Key metrics Net Interest Income (NII) sensitivity to +100bps was £211m and to ‑100bps was £(215)m (2022: £238m and £(194)m). Economic Value of Equity (EVE) sensitivity to +100bps was £(277)m and to ‑100bps was £243m (2022: £(501)m and £651m). |
30 June 2023 | 31 December 2022 | ||||||||||||||||
+100bps | -100bps | +100bps | -100bps | ||||||||||||||
£m | £m | £m | £m | ||||||||||||||
NII sensitivity(1) | 211 | (215) | 238 | (194) | |||||||||||||
EVE sensitivity | (277) | 243 | (501) | 651 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Overview Liquidity risk is the risk that, while still being solvent, we do not have the liquid financial resources to meet our obligations when they fall due, or we can only obtain them at high cost. Liquidity risk management In H123, there were no significant changes in the way we manage liquidity risk as described in the 2022 Annual Report. Liquidity risk review In this section, we analyse our key liquidity metrics and our wholesale funding. We also provide information on asset encumbrance. | Key metrics LCR of 160% (2022: 163%) Wholesale funding with maturity <1 year £13.0bn (2022: £11.0bn) LCR eligible liquidity pool carrying value of £50.2bn (2022: £49.0m) |
30 June 2023 | 31 December 2022 | ||||||||||
LCR | £bn | £bn | |||||||||
Eligible liquidity pool (liquidity value)(1) | 49.7 | 48.9 | |||||||||
Net stress outflows | (31.1) | (30.0) | |||||||||
Surplus | 18.6 | 18.9 | |||||||||
Eligible liquidity pool as a percentage of anticipated net cash flows | 160 | % | 163 | % | |||||||
30 June 2023 | 31 December 2022 | ||||||||||
NSFR | 135 | % | 137 | % |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
≤ 1 month | >1 and ≤ 3 months | >3 and ≤ 6 months | >6 and ≤ 9 months | >9 and ≤ 12 months | Sub-total ≤ 1 year | >1 and ≤ 2 years | >2 and ≤ 5 years | >5 years | Total | |||||||||||||||||||||||
30 June 2023 | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | £bn | ||||||||||||||||||||||
Santander UK Group Holdings plc(1) | ||||||||||||||||||||||||||||||||
Senior unsecured – public benchmark | — | 0.6 | 0.8 | 1.6 | — | 3.0 | 0.5 | 7.6 | 1.1 | 12.2 | ||||||||||||||||||||||
–privately placed | — | — | — | — | — | — | — | 0.1 | — | 0.1 | ||||||||||||||||||||||
Subordinated liabilities and equity (incl. AT1) | — | — | — | — | 0.5 | 0.5 | 0.5 | 1.0 | 1.0 | 3.0 | ||||||||||||||||||||||
— | 0.6 | 0.8 | 1.6 | 0.5 | 3.5 | 1.0 | 8.7 | 2.1 | 15.3 | |||||||||||||||||||||||
Santander UK plc | ||||||||||||||||||||||||||||||||
Deposits by banks | 0.2 | 0.6 | 0.7 | 0.2 | — | 1.7 | — | — | — | 1.7 | ||||||||||||||||||||||
Certificates of deposit and commercial paper | 1.5 | 1.5 | 0.5 | — | — | 3.5 | — | — | — | 3.5 | ||||||||||||||||||||||
Senior unsecured – public benchmark | — | — | — | 0.6 | 0.3 | 0.9 | 0.3 | — | 0.3 | 1.5 | ||||||||||||||||||||||
–privately placed | — | — | — | — | — | — | 0.1 | 0.2 | 0.1 | 0.4 | ||||||||||||||||||||||
Covered bonds | — | 0.9 | — | 1.0 | 0.9 | 2.8 | 2.3 | 9.3 | 1.0 | 15.4 | ||||||||||||||||||||||
Securitisation & structured issuance(2) | 0.1 | — | — | — | — | 0.1 | 0.1 | 1.4 | — | 1.6 | ||||||||||||||||||||||
TFSME | — | — | — | — | — | — | — | 21.0 | — | 21.0 | ||||||||||||||||||||||
Subordinated liabilities | — | — | 0.4 | — | — | 0.4 | — | — | 0.7 | 1.1 | ||||||||||||||||||||||
1.8 | 3.0 | 1.6 | 1.8 | 1.2 | 9.4 | 2.8 | 31.9 | 2.1 | 46.2 | |||||||||||||||||||||||
Other group entities | ||||||||||||||||||||||||||||||||
Securitisation & structured issuance(3) | 0.1 | — | — | — | — | 0.1 | 0.5 | — | — | 0.6 | ||||||||||||||||||||||
Total at 30 June 2023 | 1.9 | 3.6 | 2.4 | 3.4 | 1.7 | 13.0 | 4.3 | 40.6 | 4.2 | 62.1 | ||||||||||||||||||||||
Of which: | ||||||||||||||||||||||||||||||||
–Secured | 0.2 | 0.9 | — | 1.0 | 0.9 | 3.0 | 2.9 | 31.7 | 1.0 | 38.6 | ||||||||||||||||||||||
–Unsecured | 1.7 | 2.7 | 2.4 | 2.4 | 0.8 | 10.0 | 1.4 | 8.9 | 3.2 | 23.5 | ||||||||||||||||||||||
31 December 2022 | ||||||||||||||||||||||||||||||||
Total at 31 December 2022 | 2.6 | 5.2 | 0.5 | 1.5 | 1.2 | 11.0 | 6.6 | 42.5 | 5.1 | 65.2 | ||||||||||||||||||||||
Of which: | ||||||||||||||||||||||||||||||||
–Secured | 0.1 | 1.0 | 0.2 | 0.9 | — | 2.2 | 3.5 | 34.0 | 1.2 | 40.9 | ||||||||||||||||||||||
–Unsecured | 2.5 | 4.2 | 0.3 | 0.6 | 1.2 | 8.8 | 3.1 | 8.5 | 3.9 | 24.3 |
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Sterling | US Dollar | Euro | Other | Total H123 | Total H122 | ||||||||||||||||||
£bn | £bn | £bn | £bn | £bn | £bn | ||||||||||||||||||
Santander UK Group Holdings plc | |||||||||||||||||||||||
Senior unsecured – public benchmark | — | 1.0 | — | — | 1.0 | 1.2 | |||||||||||||||||
Subordinated debt and equity (inc. AT1) | 0.3 | — | — | — | 0.3 | 0.8 | |||||||||||||||||
0.3 | 1.0 | — | — | 1.3 | 2.0 | ||||||||||||||||||
Santander UK plc | |||||||||||||||||||||||
Securitisations and other secured funding | 0.8 | — | — | — | 0.8 | — | |||||||||||||||||
Covered bonds | 1.5 | — | — | — | 1.5 | 4.1 | |||||||||||||||||
2.3 | — | — | — | 2.3 | 4.1 | ||||||||||||||||||
Other group entities | |||||||||||||||||||||||
Securitisations | 0.5 | — | — | — | 0.5 | — | |||||||||||||||||
Total gross issuances | 3.1 | 1.0 | — | — | 4.1 | 6.1 |
30 June 2023 | 31 December 2022 | ||||||||||||||||||||||
Customer loans | Customer deposits | LDR(2) | Customer loans | Customer deposits | LDR(2) | ||||||||||||||||||
£bn | £bn | % | £bn | £bn | % | ||||||||||||||||||
Total customer loans and deposits(1) | 210.8 | 190.7 | 111 | % | 219.7 | 196.5 | 112 | % | |||||||||||||||
Adjust for fair value loans, impairment loss allowances, accrued interest and other | 4.2 | 0.9 | 4.1 | 0.8 | |||||||||||||||||||
Statutory loans and advances to customers and deposits by customers | 215.0 | 191.6 | 112 | % | 223.8 | 197.3 | 113 | % |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Overview Capital risk is the risk that we do not have an adequate amount or quality of capital to meet our internal business needs, regulatory requirements and market expectations. Capital risk management In H123, there were no significant changes in the way we manage capital risk as described in the 2022 Annual Report. Capital risk review In this section, we analyse our capital resources and key capital ratios including our leverage and RWAs. | Key metrics CET1 capital ratio of 15.4% (2022: 15.2%) Total qualifying regulatory capital of £14.6bn (2022: £14.5bn) UK leverage ratio of 5.3% (2022: 5.2%) |
Minimum | |||||
% | |||||
Pillar 1 | 4.5 | ||||
Pillar 2A(1) | 3.2 | ||||
Capital conservation buffer | 2.5 | ||||
Countercyclical capital buffer | 1.0 | ||||
Current MDA trigger | 11.2 | ||||
Headroom | 4.2 | ||||
CET1 capital ratio | 15.4 |
Santander UK Group Holdings plc | Santander UK plc | ||||||||||||||||
30 June 2023 | 31 December 2022 | 30 June 2023 | 31 December 2022 | ||||||||||||||
% | % | % | % | ||||||||||||||
CET1 capital ratio | 15.4 | 15.2 | 15.6 | 15.4 | |||||||||||||
AT1 | 3.0 | 3.1 | 2.8 | 2.8 | |||||||||||||
Tier 2 | 1.9 | 2.1 | 2.0 | 2.2 | |||||||||||||
Total capital ratio | 20.3 | 20.4 | 20.4 | 20.4 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Change | CET1 Capital ratio | |||||||
pp | % | |||||||
31 December 2022 | 15.2 | |||||||
Profit net of distributions | +0.51 | |||||||
Pension | -0.11 | |||||||
Expected loss less provisions | -0.06 | |||||||
RWA growth and other | -0.19 | |||||||
30 June 2023 | 15.4 |
30 June 2023 | 31 December 2022 | ||||||||||
£m | £m | ||||||||||
CET1 capital instruments and reserves: | |||||||||||
– Capital instruments | 7,060 | 7,060 | |||||||||
– Retained earnings | 6,820 | 6,563 | |||||||||
– Accumulated other reserves and non-controlling interests | (1,163) | (1,108) | |||||||||
CET1 capital before regulatory adjustments | 12,717 | 12,515 | |||||||||
CET1 regulatory adjustments: | |||||||||||
– Additional value adjustments | (14) | (18) | |||||||||
– Goodwill (net of tax) | (1,131) | (1,133) | |||||||||
– Other intangibles | (350) | (351) | |||||||||
– Fair value reserves related to gains or losses on cash flow hedges | 1,168 | 1,116 | |||||||||
– Negative amounts resulting from the calculation of regulatory expected loss amounts | (566) | (517) | |||||||||
– Gains or losses on liabilities valued at fair value resulting from changes in own credit standing | (21) | (27) | |||||||||
– Defined benefit pension fund assets | (720) | (755) | |||||||||
– NPE Backstop | (5) | (4) | |||||||||
– Dividend accrual | (17) | (3) | |||||||||
– IFRS 9 Transitional Adjustment | 9 | 20 | |||||||||
CET1 capital | 11,070 | 10,843 | |||||||||
AT1 capital instruments: | |||||||||||
– Capital instruments | 2,196 | 2,196 | |||||||||
Tier 1 capital | 13,266 | 13,039 | |||||||||
Tier 2 capital instruments: | |||||||||||
– Capital instruments | 2,150 | 2,111 | |||||||||
– Amount of qualifying items subject to phase out from Tier 2 | 0 | 207 | |||||||||
– Regulatory deductions for instruments issued by subsidiary undertakings or subject to CRDIV amortisation and repurchases | (782) | (857) | |||||||||
Tier 2 capital | 1,368 | 1,461 | |||||||||
Total regulatory capital | 14,634 | 14,500 |
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CET1 capital | AT1 capital | Tier 2 capital | Total | |||||||||||
£m | £m | £m | £m | |||||||||||
At 1 January 2023 | 10,843 | 2,196 | 1,461 | 14,500 | ||||||||||
–Retained earnings | 257 | — | — | 257 | ||||||||||
–Other reserves and non-controlling interests | (55) | — | — | (55) | ||||||||||
–Additional value adjustments | 4 | — | — | 4 | ||||||||||
–Goodwill (net of tax) | 2 | — | — | 2 | ||||||||||
–Other intangibles | 1 | — | — | 1 | ||||||||||
–Fair value reserves related to gains and losses on cash flow hedges | 52 | — | — | 52 | ||||||||||
–Negative amounts resulting from the calculation of regulatory expected loss amounts | (49) | — | — | (49) | ||||||||||
–Gains or losses on liabilities valued at fair value resulting from changes in own credit standing | 6 | — | — | 6 | ||||||||||
–Defined benefit pension fund assets | 35 | — | — | 35 | ||||||||||
–NPE Backstop | (1) | — | — | (1) | ||||||||||
–Dividend accrual | (14) | — | — | (14) | ||||||||||
–Capital instruments | — | — | 39 | 39 | ||||||||||
–IFRS 9 Transitional Adjustment | (11) | — | — | (11) | ||||||||||
–Amount of qualifying items subject to phase out from Tier 2 | — | — | (207) | (207) | ||||||||||
- Deductions for instruments issued by subsidiary undertakings or subject to CRD IV amortisation | — | — | 75 | 75 | ||||||||||
At 30 June 2023 | 11,070 | 2,196 | 1,368 | 14,634 |
30 June 2023 | 31 December 2022 | ||||||||||
RWAs by risk | £bn | £bn | |||||||||
Credit risk | 63.9 | 63.0 | |||||||||
Counterparty risk | 0.6 | 0.7 | |||||||||
Market risk | 0.3 | 0.3 | |||||||||
Operational risk | 7.2 | 7.2 | |||||||||
72.0 | 71.2 |
30 June 2023 | 31 December 2022 | ||||||||||
RWAs by segment | £bn | £bn | |||||||||
Retail Banking | 44.5 | 44.6 | |||||||||
– Homes | 34.8 | 35.0 | |||||||||
– Everyday Banking | 9.7 | 9.6 | |||||||||
Consumer Finance | 7.7 | 7.3 | |||||||||
Corporate & Commercial Banking | 14.5 | 14.0 | |||||||||
Corporate Centre | 5.3 | 5.3 | |||||||||
72.0 | 71.2 |
Credit/counterparty risk | Market risk | Operational risk | Total | |||||||||||
£bn | £bn | £bn | £bn | |||||||||||
At 1 January 2023 | 63.7 | 0.3 | 7.2 | 71.2 | ||||||||||
Asset size | (0.6) | — | — | (0.6) | ||||||||||
Asset quality | 1.2 | — | — | 1.2 | ||||||||||
Model updates | 0.2 | — | — | 0.2 | ||||||||||
At 30 June 2023 | 64.5 | 0.3 | 7.2 | 72.0 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | ||||||||||
£m | £m | ||||||||||
Regulatory exposure | 245,725 | 248,602 | |||||||||
End-point Tier 1 capital(1) | 13,067 | 12,863 | |||||||||
UK leverage ratio | 5.3 | % | 5.2 | % | |||||||
BBLS lending excluded from leverage exposure | (2,173) | (2,564) |
30 June 2023 | 31 December 2022 | ||||||||||
£m | £m | ||||||||||
Total assets per the Consolidated Balance Sheet | 284,341 | 292,243 | |||||||||
Derivatives netting and potential future exposure | (1,475) | (1,305) | |||||||||
Securities financing current exposure add-on | 386 | 371 | |||||||||
Removal of IFRS netting | 867 | 923 | |||||||||
Removal of qualifying central bank claims | (44,696) | (49,199) | |||||||||
Commitments calculated in accordance with Basel Committee Leverage Framework | 7,269 | 6,971 | |||||||||
CET1 regulatory adjustments | (967) | (1,402) | |||||||||
245,725 | 248,602 |
30 June 2023 | 31 December 2022 | ||||||||||
£m | £m | ||||||||||
At 1 January | 4,307 | 4,262 | |||||||||
Dividends approved: | |||||||||||
–AT1 Capital Securities | (67) | (143) | |||||||||
–Tax on above item | 13 | 27 | |||||||||
–Ordinary shares | (414) | (1,013) | |||||||||
Dividends receivable: | |||||||||||
–Investment in AT1 Capital Securities | 61 | 133 | |||||||||
–Tax on above item | (12) | (25) | |||||||||
–Investment in ordinary shares of subsidiary | 412 | 1,079 | |||||||||
Other income statement items (Company) | (3) | (13) | |||||||||
At period end | 4,297 | 4,307 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Overview Pension risk is the risk caused by our statutory contractual or other liabilities with respect to a pension scheme (whether set up for our employees or those of a related company or otherwise). It also refers to the risk that we will need to make payments or other contributions with respect to a pension scheme due to some other reason. Pension risk management In H123, there were no significant changes in the way we manage pension risk as described in the 2022 Annual Report. Pension risk review In this section, we provide an update on key movements in pension risk profile in H123. | Key metrics Funding Deficit at Risk was £930m (2022: £860m) Funded defined benefit pension scheme accounting surplus was £999m (2022: £1,051m) |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Overview Operational risk is the risk of loss due to inadequate or failed internal processes, people and systems, or external events. Operational risk management In H123, there were no significant changes in the way we manage operational risk as described in the 2022 Annual Report. Operational risk review In this section, we provide an update on key movements in operational risk in H123. | Key metrics Operational risk losses (over £10,000, and excluding PPI) increased by 8% compared to H122. |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Overview We manage the conduct and non-financial regulatory risk types in one framework. We do this to reflect their similarities. Conduct and regulatory risk management In H123, there were no significant changes in the way we manage conduct and regulatory risk as described in the 2022 Annual Report. Conduct and regulatory risk review In this section, we provide an update on key developments in conduct and regulatory risk in H123. | Key metrics Customer remediation provision was £90m (2022: £90m) Litigation and other regulatory provision was £138m (2022: £136m) |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Overview Financial crime risk is the risk that we are used to further financial crime, including money laundering, sanctions evasion, terrorist financing, facilitation of tax evasion, bribery and corruption. Financial crime risk management In H123, there were no significant changes in the way we manage financial crime risk as described in the 2022 Annual Report. Financial crime risk review In this section, we provide an update on key developments in financial crime risk in H123. |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Financial statements | |||||||||||
Contents | |||||||||||
Primary financial statements | |||||||||||
Condensed Consolidated Income Statement | |||||||||||
Condensed Consolidated Statement of Comprehensive Income | |||||||||||
Condensed Consolidated Balance Sheet | |||||||||||
Condensed Consolidated Cash Flow Statement | |||||||||||
Condensed Consolidated Statement of Changes in Equity | |||||||||||
Notes to the financial statements |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 30 June 2022 | ||||||||||
Notes | £m | £m | |||||||||
Interest and similar income | |||||||||||
Interest expense and similar charges | ( | ( | |||||||||
Net interest income | |||||||||||
Fee and commission income | |||||||||||
Fee and commission expense | ( | ( | |||||||||
Net fee and commission income | |||||||||||
Other operating income | |||||||||||
Total operating income | |||||||||||
Operating expenses before credit impairment charges, provisions and charges | 3 | ( | ( | ||||||||
Credit impairment charges | 4 | ( | ( | ||||||||
Provisions for other liabilities and charges | 4 | ( | ( | ||||||||
Total operating credit impairment charges, provisions and charges | ( | ( | |||||||||
Profit before tax | |||||||||||
Tax on profit | 5 | ( | ( | ||||||||
Profit after tax | |||||||||||
Attributable to: | |||||||||||
Equity holders of the parent | |||||||||||
Non-controlling interests | |||||||||||
Profit after tax |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 30 June 2022 | |||||||
£m | £m | |||||||
Profit after tax | ||||||||
Other comprehensive (expense)/income that may be reclassified to profit or loss subsequently: | ||||||||
Movement in fair value reserve (debt instruments): | ||||||||
- Change in fair value | ( | ( | ||||||
- Income statement transfers | ||||||||
- Taxation | ||||||||
( | ( | |||||||
Cash flow hedges: | ||||||||
- Effective portion of changes in fair value | ( | |||||||
- Income statement transfers | ( | |||||||
- Taxation | ||||||||
( | ( | |||||||
Net other comprehensive expense that may be reclassified to profit or loss subsequently | ( | ( | ||||||
Other comprehensive (expense)/income that will not be reclassified to profit or loss subsequently: | ||||||||
Pension remeasurement: | ||||||||
- Change in fair value | ( | |||||||
- Taxation | ( | |||||||
( | ||||||||
Own credit adjustment: | ||||||||
- Change in fair value | ( | |||||||
- Taxation | ( | |||||||
( | ||||||||
Net other comprehensive (expense)/income that will not be reclassified to profit or loss subsequently | ( | |||||||
Total other comprehensive expense net of tax | ( | ( | ||||||
Total comprehensive income | ||||||||
Attributable to: | ||||||||
Equity holders of the parent | ||||||||
Non-controlling interests | ||||||||
Total comprehensive income |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | ||||||||||
Notes | £m | £m | |||||||||
Assets | |||||||||||
Cash and balances at central banks | |||||||||||
Derivative financial instruments | 7 | ||||||||||
Other financial assets at fair value through profit or loss | 8 | ||||||||||
Loans and advances to customers | 9 | ||||||||||
Loans and advances to banks | |||||||||||
Reverse repurchase agreements - non trading | 11 | ||||||||||
Other financial assets at amortised cost | |||||||||||
Macro hedge of interest rate risk | ( | ( | |||||||||
Financial assets at fair value through other comprehensive income | |||||||||||
Interests in other entities | 12 | ||||||||||
Intangible assets | 13 | ||||||||||
Property, plant and equipment | 14 | ||||||||||
Current tax assets | |||||||||||
Retirement benefit assets | 22 | ||||||||||
Other assets | |||||||||||
Assets held for sale | 29 | ||||||||||
Total assets | |||||||||||
Liabilities | |||||||||||
Derivative financial instruments | 7 | ||||||||||
Other financial liabilities at fair value through profit or loss | 15 | ||||||||||
Deposits by customers | 16 | ||||||||||
Deposits by banks | 17 | ||||||||||
Repurchase agreements - non trading | 18 | ||||||||||
Debt securities in issue | 19 | ||||||||||
Subordinated liabilities | 20 | ||||||||||
Macro hedge of interest rate risk | ( | ||||||||||
Other liabilities | |||||||||||
Provisions | 21 | ||||||||||
Deferred tax liabilities | |||||||||||
Retirement benefit obligations | 22 | ||||||||||
Total liabilities | |||||||||||
Equity | |||||||||||
Share capital | |||||||||||
Other equity instruments | 24 | ||||||||||
Retained earnings | |||||||||||
Other reserves | ( | ( | |||||||||
Total equity | |||||||||||
Total liabilities and equity |
Mike Regnier | Madhukar Dayal | ||||
Chief Executive Officer | Chief Financial Officer | ||||
Company Registered Number: 08700698 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 30 June 2022 | |||||||
£m | £m | |||||||
Cash flows from operating activities | ||||||||
Profit before tax | ||||||||
Adjustments for: | ||||||||
Non-cash items included in profit: | ||||||||
Change in operating assets | ( | |||||||
Change in operating liabilities | ( | ( | ||||||
Corporation taxes paid | ( | ( | ||||||
Effects of exchange rate differences | ( | |||||||
Net cash flows from operating activities | ( | |||||||
Cash flows from investing activities | ||||||||
Purchase of property, plant and equipment and intangible assets | ( | ( | ||||||
Proceeds from sale of property, plant and equipment and intangible assets | ||||||||
Purchase of financial assets at amortised cost and financial assets at FVOCI | ( | ( | ||||||
Proceeds from sale and redemption of financial assets at amortised cost and financial assets at FVOCI | ||||||||
Net cash flows from investing activities | ( | |||||||
Cash flows from financing activities | ||||||||
Issue of other equity instruments | ||||||||
Issue of debt securities and subordinated notes | ||||||||
Issuance costs of debt securities and subordinated notes | ( | ( | ||||||
Repayment of debt securities and subordinated notes | ( | ( | ||||||
Disposal of non-controlling interests | ( | |||||||
Repurchase of other equity instruments | ( | |||||||
Dividends paid on ordinary shares | ( | ( | ||||||
Dividends paid on other equity instruments | ( | ( | ||||||
Dividends paid on non-controlling interests | ( | |||||||
Principal elements of lease payments | ( | ( | ||||||
Net cash flows from financing activities | ( | |||||||
Change in cash and cash equivalents | ( | ( | ||||||
Cash and cash equivalents at beginning of the period | ||||||||
Effects of exchange rate changes on cash and cash equivalents | ( | |||||||
Cash and cash equivalents at the end of the period | ||||||||
Cash and cash equivalents consist of: | ||||||||
Cash and balances at central banks | ||||||||
Less: restricted balances | ( | ( | ||||||
Other cash equivalents: Loans and advances to banks - Non trading | ||||||||
Other cash equivalents: Reverse repurchase agreements | ||||||||
Cash and cash equivalents at the end of the period |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Other reserves | Non-controlling interests | ||||||||||||||||||||||||||||
Share capital | Other equity instruments | Fair value | Cash flow hedging | Currency translation | Retained earnings | ||||||||||||||||||||||||
Total | Total | ||||||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | £m | |||||||||||||||||||||
At 1 January 2023 | ( | ||||||||||||||||||||||||||||
Profit after tax | — | — | — | — | — | — | |||||||||||||||||||||||
Other comprehensive (expense), net of tax: | |||||||||||||||||||||||||||||
- Fair value reserve (debt instruments) | — | — | ( | — | — | — | ( | — | ( | ||||||||||||||||||||
- Cash flow hedges | — | — | — | ( | — | — | ( | — | ( | ||||||||||||||||||||
- Pension remeasurement | — | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||
- Own credit adjustment | — | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||
Total comprehensive income | — | — | ( | ( | — | ||||||||||||||||||||||||
Dividends on ordinary shares | — | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||
Dividends on other equity instruments | — | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||
At 30 June 2023 | ( | ||||||||||||||||||||||||||||
At 1 January 2022 | |||||||||||||||||||||||||||||
Profit after tax | — | — | — | — | — | ||||||||||||||||||||||||
Other comprehensive (expense)/income, net of tax: | |||||||||||||||||||||||||||||
- Fair value reserve (debt instruments) | — | — | ( | — | — | — | ( | — | ( | ||||||||||||||||||||
- Cash flow hedges | — | — | — | ( | — | — | ( | — | ( | ||||||||||||||||||||
- Pension remeasurement | — | — | — | — | — | — | |||||||||||||||||||||||
- Own credit adjustment | — | — | — | — | — | — | |||||||||||||||||||||||
Total comprehensive income | — | — | ( | ( | — | ||||||||||||||||||||||||
Issue of other equity instruments | — | — | — | — | — | — | |||||||||||||||||||||||
Disposal of non-controlling interests | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||
Repurchase of other equity instruments | — | ( | — | — | — | ( | ( | — | ( | ||||||||||||||||||||
Dividends on ordinary shares | — | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||
Dividends on other equity instruments | — | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||
Dividends on non-controlling interests | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||
At 30 June 2022 | ( | ||||||||||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Key judgements | –Determining an appropriate definition of default | ||||
–Establishing the criteria for a significant increase in credit risk (SICR) and, for corporate borrowers, internal credit risk rating | |||||
–Determining the need for any judgemental adjustments | |||||
–Determining the need to assess corporate Stage 3 exposures individually | |||||
Key estimates | –Forward-looking multiple economic scenario assumptions | ||||
–Probability weights assigned to multiple economic scenarios |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Key judgements | –Determining whether a present obligation exists | ||||
–Determining the likely outcome of future legal decisions | |||||
Key estimates | –Probability, timing, nature and amount of any outflows that may arise from past events |
Key judgements | –Setting the criteria for constructing the corporate bond yield curve used to determine the discount rate | ||||
–Determining the methodology for setting the inflation assumption | |||||
Key estimates | –Discount rate applied to future cash flows | ||||
–Rate of price inflation | |||||
–Expected lifetime of the schemes' members | |||||
–Valuation of pension fund assets whose values are not based on market observable data |
Key judgements: | –Determining the basis of goodwill impairment testing methodology, including the need for planning assumptions and internal capital allocations | ||||
–Identifying the indicators of potential impairment | |||||
Key estimates: | –Forecast cash flows for cash generating units, including estimated allocations of regulatory capital | ||||
–Growth rate beyond initial cash flow projections | |||||
–Discount rates which factor in risk-free rates and applicable risk premiums | |||||
All of these variables are subject to fluctuations in external market rates and economic conditions beyond management’s control |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Retail Banking | Consumer Finance | Corporate & Commercial Banking | Corporate Centre | Total | |||||||||||||
30 June 2023 | £m | £m | £m | £m | £m | ||||||||||||
Net interest income | |||||||||||||||||
Non-interest income | |||||||||||||||||
Total operating income | |||||||||||||||||
Operating expenses before credit impairment charges, provisions and charges | ( | ( | ( | ( | ( | ||||||||||||
Credit impairment charges | ( | ( | ( | ( | |||||||||||||
Provisions for other liabilities and charges | ( | ( | ( | ( | |||||||||||||
Total operating credit impairment charges, provisions and charges | ( | ( | ( | ( | ( | ||||||||||||
Profit/(loss) before tax | ( | ||||||||||||||||
Revenue from external customers | |||||||||||||||||
Inter-segment revenue/(expense) | ( | ( | |||||||||||||||
Total operating income | |||||||||||||||||
Revenue from external customers includes the following fee and commission income:(1) | |||||||||||||||||
–Current account and debit card fees | |||||||||||||||||
–Insurance, protection and investments | |||||||||||||||||
–Credit cards | |||||||||||||||||
–Non-banking and other fees(2) | |||||||||||||||||
Total fee and commission income | |||||||||||||||||
Fee and commission expense | ( | ( | ( | ( | ( | ||||||||||||
Net fee and commission income/(expense) | ( | ||||||||||||||||
Customer loans | |||||||||||||||||
Total assets(3) | |||||||||||||||||
Of which assets held for sale | |||||||||||||||||
Customer deposits | |||||||||||||||||
Total liabilities | |||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Retail Banking | Consumer Finance | Corporate & Commercial Banking | Corporate Centre | Total | |||||||||||||
30 June 2022 | £m | £m | £m | £m | £m | ||||||||||||
Net interest income | |||||||||||||||||
Non-interest income/(expense) | ( | ||||||||||||||||
Total operating income | |||||||||||||||||
Operating expenses before credit impairment (charges)/write-backs, provisions and charges | ( | ( | ( | ( | ( | ||||||||||||
Credit impairment (charges)/write-backs | ( | ( | ( | ||||||||||||||
Provisions for other liabilities and charges | ( | ( | ( | ( | |||||||||||||
Total operating credit impairment (charges)/write-backs, provisions and charges | ( | ( | ( | ( | |||||||||||||
Profit/(loss) before tax | ( | ||||||||||||||||
Revenue/(expense) from external customers | ( | ||||||||||||||||
Inter-segment revenue/(expense) | ( | ( | ( | ||||||||||||||
Total operating income/(expense) | |||||||||||||||||
Revenue from external customers includes the following fee and commission income:(1) | |||||||||||||||||
–Current account and debit card fees | |||||||||||||||||
–Insurance, protection and investments | |||||||||||||||||
–Credit cards | |||||||||||||||||
–Non-banking and other fees(2) | |||||||||||||||||
Total fee and commission income | |||||||||||||||||
Fee and commission expense | ( | ( | ( | ( | |||||||||||||
Net fee/(expense) and commission income | ( | ||||||||||||||||
31 December 2022 | |||||||||||||||||
Customer loans | |||||||||||||||||
Total assets(3) | |||||||||||||||||
Of which assets held for sale | |||||||||||||||||
Customer deposits | |||||||||||||||||
Total liabilities | |||||||||||||||||
30 June 2023 | 30 June 2022 | |||||||
£m | £m | |||||||
Staff costs | ||||||||
Other administration expenses | ||||||||
Depreciation, amortisation and impairment | ||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 30 June 2022 | |||||||
£m | £m | |||||||
Credit impairment charges/(write-backs): | ||||||||
Loans and advances to customers | ||||||||
Recoveries of loans and advances, net of collection costs | ( | |||||||
Off-balance sheet credit exposures (See Note 21) | ||||||||
Provisions for other liabilities and charges (excluding off-balance sheet credit exposures) (See Note 21) | ||||||||
Releases for residual value and voluntary termination | ( | ( | ||||||
30 June 2023 | 30 June 2022 | |||||||
£m | £m | |||||||
Profit before tax | ||||||||
Tax calculated at a tax rate of 23.5% (H122:19%) | ||||||||
Bank surcharge on profits | ||||||||
Non-deductible preference dividends paid | ||||||||
Non-deductible UK Bank Levy | ||||||||
Non-deductible conduct remediation, fines and penalties | ( | |||||||
Other non-deductible costs and non-taxable income | ( | |||||||
Effect of change in tax rate on deferred tax provision | ( | |||||||
Tax relief on dividends in respect of other equity instruments | ( | ( | ||||||
Tax charge |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | ||||||||||||||||||||||
Fair value | Fair value | ||||||||||||||||||||||
Notional amount | Assets | Liabilities | Notional amount | Assets | Liabilities | ||||||||||||||||||
£m | £m | £m | £m | £m | £m | ||||||||||||||||||
Derivatives held for trading: | |||||||||||||||||||||||
Exchange rate contracts | |||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||
Equity and credit contracts | |||||||||||||||||||||||
Total derivatives held for trading | |||||||||||||||||||||||
Derivatives held for hedging | |||||||||||||||||||||||
Designated as fair value hedges: | |||||||||||||||||||||||
Exchange rate contracts | |||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||
Designated as cash flow hedges: | |||||||||||||||||||||||
Exchange rate contracts | |||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||
Equity derivative contracts | |||||||||||||||||||||||
Total derivatives held for hedging | |||||||||||||||||||||||
Derivative netting(1) | — | ( | ( | — | ( | ( | |||||||||||||||||
Total derivatives |
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Loans and advances to customers | ||||||||
Debt securities | ||||||||
Equity securities | ||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Loans and advances to customers | ||||||||
Credit impairment loss allowances on loans and advances to customers | ( | ( | ||||||
Residual value and voluntary termination provisions on finance leases | ( | ( | ||||||
Net loans and advances to customers |
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Mortgage-backed master trust structures: | ||||||||
–Holmes | ||||||||
–Fosse | ||||||||
Other asset-backed securitisation structures: | ||||||||
–Motor | ||||||||
–Repton | ||||||||
Total securitisation programmes | ||||||||
Covered bond programme: | ||||||||
–Euro | ||||||||
Total securitisation and covered bond programmes |
Internal issuances | External issuances | Internal redemptions | External redemptions | ||||||||||||||||||||||||||||||||
H123 | H122 | H123 | H122 | H123 | H122 | H123 | H122 | ||||||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||||||||
Mortgage-backed master trust structures: | |||||||||||||||||||||||||||||||||||
–Holmes | |||||||||||||||||||||||||||||||||||
–Fosse | |||||||||||||||||||||||||||||||||||
Other asset-backed securitisation structures: | |||||||||||||||||||||||||||||||||||
–Motor | |||||||||||||||||||||||||||||||||||
–Repton | |||||||||||||||||||||||||||||||||||
Covered bond programme: | |||||||||||||||||||||||||||||||||||
–Euro | |||||||||||||||||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Agreements with banks | ||||||||
Agreements with customers | ||||||||
Property | Office fixtures and equipment | Computer software | Operating lease assets | Right-of-use assets | Total(1) | |||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||
Cost: | ||||||||||||||||||||
At 1 January 2023 | ||||||||||||||||||||
Additions | ||||||||||||||||||||
Disposals | ( | ( | ( | ( | ( | |||||||||||||||
At 30 June 2023 | ||||||||||||||||||||
Accumulated depreciation: | ||||||||||||||||||||
At 1 January 2023 | ||||||||||||||||||||
Charge for the period | ||||||||||||||||||||
Disposals | ( | ( | ( | ( | ||||||||||||||||
At 30 June 2023 | ||||||||||||||||||||
Carrying amount |
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Structured Notes Programmes | ||||||||
Eurobonds | ||||||||
Structured deposits | ||||||||
Other | ||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Demand and time deposits(1) | ||||||||
Amounts due to fellow Banco Santander subsidiaries and joint ventures | ||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Items in the course of transmission | ||||||||
Deposits held as collateral | ||||||||
Other deposits(1) | ||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Agreements with banks | ||||||||
Agreements with customers | ||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Medium-term notes | ||||||||
Euro | ||||||||
US$ | ||||||||
Certificates of deposit | ||||||||
Credit linked notes | ||||||||
Securitisation programmes | ||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
£ | ||||||||
Undated subordinated liabilities | ||||||||
Dated subordinated liabilities | ||||||||
Customer remediation | Litigation and other regulatory | Bank Levy | Property | ECL on undrawn facilities and guarantees | Restructuring | Other | Total | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | |||||||||||||||||||
At 1 January 2023 | ||||||||||||||||||||||||||
Additional provisions (See Note 4) | ||||||||||||||||||||||||||
Provisions released (See Note 4) | ( | ( | ( | ( | ||||||||||||||||||||||
Utilisation and other | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||
At 30 June 2023 |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Assets/(liabilities) | ||||||||
Funded defined benefit pension scheme - surplus | ||||||||
Unfunded pension and post-retirement medical benefits | ( | ( | ||||||
Total net assets |
30 June 2023 | 30 June 2022 | |||||||
£m | £m | |||||||
Return on plan assets (excluding amounts included in net interest expense) | ||||||||
Actuarial losses arising from experience adjustments | ||||||||
Actuarial gains arising from changes in financial assumptions | ( | ( | ||||||
Pension remeasurement | ( |
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Present value of defined benefit obligations | ( | ( | ||||||
Fair value of scheme assets | ||||||||
Net defined benefit assets |
30 June 2023 | 31 December 2022 | |||||||
% | % | |||||||
To determine benefit obligations(1): | ||||||||
– Discount rate for scheme liabilities | ||||||||
– General price inflation | ||||||||
– General salary increase | ||||||||
– Expected rate of pension increase |
Years | Years | |||||||
Longevity at 60 for current pensioners, on the valuation date: | ||||||||
– Males | ||||||||
– Females | ||||||||
Longevity at 60 for future pensioners currently aged 40, on the valuation date: | ||||||||
– Males | ||||||||
– Females |
(Decrease)/increase | |||||||||||
30 June 2023 | 31 December 2022 | ||||||||||
Assumption | Change in pension obligation at period end from | £m | £m | ||||||||
Discount rate | ( | ( | |||||||||
General price inflation | |||||||||||
Mortality |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Guarantees given to third parties | ||||||||
Formal standby facilities, credit lines and other commitments | ||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
Interest rate | 30 June 2023 | 31 December 2022 | ||||||||||||
% | Next call date | £m | £m | |||||||||||
AT1 securities: | ||||||||||||||
- £ | ||||||||||||||
- £ | ||||||||||||||
- £ | ||||||||||||||
- £ | ||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | ||||||||||||||||
Fair | Carrying | Fair | Carrying | ||||||||||||||
value | value | value | value | ||||||||||||||
£m | £m | £m | £m | ||||||||||||||
Assets | |||||||||||||||||
Loans and advances to customers | |||||||||||||||||
Loans and advances to banks | |||||||||||||||||
Reverse repurchase agreements - non trading | |||||||||||||||||
Other financial assets at amortised cost | |||||||||||||||||
Liabilities | |||||||||||||||||
Deposits by customers | |||||||||||||||||
Deposits by banks | |||||||||||||||||
Repurchase agreements - non trading | |||||||||||||||||
Debt securities in issue | |||||||||||||||||
Subordinated liabilities | |||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | ||||||||||||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | Valuation | |||||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | technique | |||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||
Derivative financial instruments | Exchange rate contracts | ||||||||||||||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||||||||||||||
Equity and credit contracts | |||||||||||||||||||||||||||||||||||
Netting | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
Other financial assets at FVTPL | Loans and advances to customers | ||||||||||||||||||||||||||||||||||
Debt securities | |||||||||||||||||||||||||||||||||||
Equity securities | |||||||||||||||||||||||||||||||||||
Financial assets at FVOCI | Debt securities | ||||||||||||||||||||||||||||||||||
Total assets at fair value | |||||||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||
Derivative financial instruments | Exchange rate contracts | ||||||||||||||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||||||||||||||
Equity and credit contracts | |||||||||||||||||||||||||||||||||||
Netting | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
Other financial liabilities at FVTPL | Debt securities in issue | ||||||||||||||||||||||||||||||||||
Structured deposits | |||||||||||||||||||||||||||||||||||
Collateral and associated financial guarantees | |||||||||||||||||||||||||||||||||||
Total liabilities at fair value |
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Risk-related: | ||||||||
- Bid-offer and trade specific adjustments | ( | ( | ||||||
- Uncertainty | ||||||||
- Credit risk adjustment | ( | ( | ||||||
- Funding fair value adjustment | ||||||||
Day One profit | ( | ( | ||||||
Assets | Liabilities | ||||||||||||||||||||||
Derivatives | Other financial assets at FVTPL | Total | Derivatives | Other financial liabilities at FVTPL | Total | ||||||||||||||||||
£m | £m | £m | £m | £m | £m | ||||||||||||||||||
At 1 January 2023 | ( | ( | ( | ||||||||||||||||||||
Total (losses)/gains recognised: | |||||||||||||||||||||||
Fair value movements(2) | ( | ( | |||||||||||||||||||||
Foreign exchange and other movements | ( | ( | |||||||||||||||||||||
Purchases | |||||||||||||||||||||||
Transfers out | ( | ( | |||||||||||||||||||||
Netting(1) | ( | ( | |||||||||||||||||||||
Settlements | ( | ( | ( | ||||||||||||||||||||
At 30 June 2023 | ( | ( | |||||||||||||||||||||
Gains/(losses) recognised in profit or loss/other comprehensive income relating to assets and liabilities held at the end of the period(2) | ( | ( | |||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | |||||||||||
GBP(2) LIBOR | USD(2) LIBOR | Total | |||||||||
£m | £m | £m | |||||||||
Assets | |||||||||||
Financial assets at amortised cost | |||||||||||
Liabilities | |||||||||||
Derivatives(1) | |||||||||||
31 December 2022 | |||||||||||
Assets | |||||||||||
Derivatives(1) | |||||||||||
Financial assets at amortised cost | |||||||||||
Liabilities | |||||||||||
Derivatives(1) | |||||||||||
Financial liabilities at amortised cost | |||||||||||
Off-balance sheet commitments given |
30 June 2023 | 31 December 2022 | ||||||||||||||||
USD LIBOR | Total | USD LIBOR | Total | ||||||||||||||
£m | £m | £m | £m | ||||||||||||||
Total notional value of hedging instruments | |||||||||||||||||
–Cash flow hedges | |||||||||||||||||
–Fair value hedges | |||||||||||||||||
Maturing after cessation date(1) | |||||||||||||||||
–Cash flow hedges | |||||||||||||||||
–Fair value hedges | |||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
30 June 2023 | 31 December 2022 | |||||||
£m | £m | |||||||
Assets | ||||||||
Property, plant and equipment | ||||||||
Total assets held for sale | ||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
CEO review | Financial overview | Directors responsibilities | Risk review | Financial statements | Shareholder information | ||||||||||||||||||||||||||||||||||||
By: | /s/ Mike Regnier | |||||||
Mike Regnier | ||||||||
Chief Executive Officer |
Cover Page |
6 Months Ended |
---|---|
Jun. 30, 2023 | |
Cover [Abstract] | |
Document Type | 6-K |
Entity Registrant Name | SANTANDER UK GROUP HOLDINGS PLC |
Amendment Flag | false |
Document Period End Date | Jun. 30, 2023 |
Document Fiscal Year Focus | 2023 |
Document Fiscal Period Focus | Q2 |
Entity Central Index Key | 0001649373 |
Current Fiscal Year End Date | --12-31 |
Condensed Consolidated Income Statement - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Profit (loss) [abstract] | ||
Interest and similar income | £ 5,454 | £ 2,786 |
Interest expense and similar charges | (3,093) | (638) |
Net interest income | 2,361 | 2,148 |
Fee and commission income | 400 | 376 |
Fee and commission expense | (252) | (210) |
Net fee and commission income | 148 | 166 |
Other operating income | 149 | 101 |
Total operating income | 2,658 | 2,415 |
Operating expenses before credit impairment charges, provisions and charges | (1,232) | (1,186) |
Credit impairment charges | (105) | (118) |
Provisions for other liabilities and charges | (148) | (118) |
Total operating credit impairment charges, provisions and charges | (253) | (236) |
Profit before tax | 1,173 | 993 |
Tax on profit | (315) | (233) |
Profit after tax | 858 | 760 |
Attributable to: | ||
Equity holders of the parent | 858 | 743 |
Non-controlling interests | 0 | 17 |
Profit after tax | £ 858 | £ 760 |
Accounting Policies |
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Accounting Policies | 1. ACCOUNTING POLICIES The financial information in these Condensed Consolidated Interim Financial Statements is unaudited and does not constitute statutory accounts as defined in section 434 of the UK Companies Act 2006. Statutory accounts for the year ended 31 December 2022 have been delivered to the Registrar of Companies. The Condensed Consolidated Interim Financial Statements reflect all adjustments that, in the opinion of management, are necessary for a fair statement of the results of operations for the interim period. All such adjustments to the financial information are of a normal, recurring nature. Because the results from common banking activities are so closely related and responsive to changes in market conditions, the results for any interim period are not necessarily indicative of the results that can be expected for the year. The Condensed Consolidated Interim Financial Statements have been prepared in accordance with International Accounting Standard IAS 34 ‘Interim Financial Reporting', as issued by the International Accounting Standards Board (IASB) and adopted in the UK, and the Disclosure Guidance and Transparency Rules sourcebook of the UK's Financial Conduct Authority (FCA). They do not include all the information and disclosures normally required for full annual financial statements and should be read in conjunction with the Consolidated Financial Statements of Santander UK Group Holdings plc (the Company) and its subsidiaries (collectively Santander UK or the Santander UK group) for the year ended 31 December 2022 which were prepared in accordance with UK-adopted International Accounting Standards (IAS). Those consolidated financial statements were also prepared in accordance with IFRSs as issued by the IASB, including interpretations issued by the IFRS Interpretations Committee, as there were no applicable differences from IFRSs as issued by the IASB for the periods presented. The same accounting policies, presentation and methods of computation are followed in these Condensed Consolidated Interim Financial Statements as were applied in the presentation of the Santander UK group’s 2022 Annual Report. Going concern In light of geopolitical and economic uncertainty, the Directors updated their going concern assessment in preparing these Condensed Consolidated Interim Financial Statements. In making their going concern assessment, the Directors considered a wide range of information that included Santander UK's long term business and strategic plans, forecasts and projections, estimated capital, funding and liquidity requirements, contingent liabilities and the reasonably possible changes in trading performance arising from potential economic, market and product developments. After making enquiries, the Directors have a reasonable expectation that Santander UK has adequate resources to continue in operational existence for at least twelve months from the date of this report and, therefore, having reassessed the principal risks and uncertainties, the Directors consider it appropriate for the Condensed Consolidated Interim Financial Statements to be prepared on a going concern basis. Critical judgements and accounting estimates The preparation of the Condensed Consolidated Interim Financial Statements in accordance with IFRS requires management to make judgements and assumptions in applying the accounting policies that affect the reported amounts of assets, liabilities, income and expenses. Due to the inherent uncertainty in making estimates, actual results reported in future periods may be based on amounts which differ from those estimates. Estimates, judgements and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. There has been no change in the inherent sensitivity of the areas of judgement in the period. Management have considered the impact of developments in principal risks and uncertainties, as set out in the Risk review, on critical judgements and accounting estimates. The significant judgements, apart from those involving estimation, made by management in applying Santander UK's accounting policies in these financial statements (key judgements) and the key sources of estimation uncertainty that may have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year (key estimates), which together are considered critical to Santander UK's results and financial position, are as follows: a) Credit impairment charges
For more on each of these key judgements and estimates, see 'Critical judgements and accounting estimates applied in calculating ECL' in the ‘Credit risk – credit risk management’ section of the Risk review in the 2022 Annual Report. Sensitivity of ECL allowance For detailed disclosures, see 'Sensitivity of ECL allowance' in the ‘Credit risk – credit risk management’ section of the Risk review. b) Provisions and contingent liabilities
Included in Litigation and other regulatory provisions in Note 21 are amounts in respect of management’s best estimates of liability relating to a legal dispute regarding allocation of responsibility for a specific PPI portfolio of complaints, and Plevin related litigation. Note 23 provides disclosure relating to ongoing factual issues and reviews that could impact the timing and amount of any outflows. Note 23 includes disclosure relating to an investigation in relation to the historical involvement of Santander UK plc, Santander Financial Services plc and Cater Allen International Limited (all subsidiaries of Santander UK Group Holdings plc) in German dividend tax arbitrage transactions. These judgements are based on the specific facts available and often require specialist professional advice. There can be a wide range of possible outcomes and uncertainties, particularly in relation to legal actions, and regulatory and consumer credit matters. As a result, it is often not possible to make reliable estimates of the likelihood and amount of any potential outflows, or to calculate any resulting sensitivities. For more on these key judgements and estimates, see Notes 21 and 23. c) Pensions
For more on each of these key judgements and estimates, see Note 22. Sensitivity of defined benefit pension scheme estimates For detailed disclosures, see ‘Actuarial assumption sensitivities’ in Note 22. The Scheme is invested in certain assets whose values are not based on market observable data, such as investments in private equity funds and property. Due diligence has been conducted to support the values obtained in respect of these assets are appropriate and represent fair value. Given the nature of these investments, we are unable to prepare sensitivities on how their values could vary as market conditions or other variables change. d) Goodwill
For more on each of these key judgements and estimates, see Note 13. Sensitivity of goodwill For detailed disclosures, see ‘Sensitivities of key assumptions in calculating VIU’ in Note 20 to the Consolidated Financial Statements in the 2022 Annual Report.
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Segments | 2. SEGMENTS Santander UK’s principal activity is financial services, mainly in the UK. The business is managed and reported on the basis of four segments, which are strategic business units that offer different products and services, have different customers and require different technology and marketing strategies. Geographical information is not provided, as substantially all of Santander UK’s activities are in the UK. In December 2022, we transferred social housing loans, and non-core liabilities to our CCB segment from Corporate Centre to reflect the way these assets are managed, and restated comparatives accordingly. This resulted in an increase in H122 profit before tax in CCB of £1m and an equal but opposite impact in Corporate Centre.Results by segment For the Half Year to
(1)The disaggregation of fees and commission income as shown above is not included in reports provided to the chief operating decision maker but is provided to show the split by reportable segments. (2)Non-banking and other fees include mortgages (except mortgage account fees), consumer finance, commitment commission, asset finance, invoice finance and trade finance. (3)Includes customer loans, net of credit impairment charge allowances.
(2)Non-banking and other fees include mortgages (except mortgage account fees), consumer finance, commitment commission, asset finance, invoice finance and trade finance. (3)Includes customer loans, net of credit impairment charge allowances.. The main differences between Customer loans and Loans and advances to customers (Note 9) are balances in Corporate Centre held for liquidity purposes. The main differences between Customer deposits and Deposits by customers (Note 16) are equity-linked deposits and intercompany deposits.
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Operating Expenses Before Credit Impairment Charges, Provisions and Charges |
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Operating Expenses Before Credit Impairment Charges, Provisions and Charges | 3. OPERATING EXPENSES BEFORE CREDIT IMPAIRMENT CHARGES, PROVISIONS AND CHARGES For the Half Year to
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Credit Impairment Charges and Provisions |
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Disclosure Of Credit Impairment Loss And Provisions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Credit Impairment Charges and Provisions | 4. CREDIT IMPAIRMENT CHARGES AND PROVISIONS For the Half Year to
In H123 and H122 there were no material credit impairment charges on loans and advances to banks, non-trading reverse repurchase agreements, other financial assets at amortised cost and financial assets at FVOCI.
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Taxation |
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Taxation | 5. TAXATION The Santander UK group’s effective tax rate for H123 was 26.9% (H122: 23.5%). The tax on profit before tax differs from the theoretical amount that would arise using the basic corporation tax rate as follows: For the Half Year to
Interim period corporation tax is accrued based on the estimated average annual effective corporation tax for the year of 26.9% (H122: 25.7% before including the impact of the reduction in the bank surcharge substantively enacted in Q1 2022). See Note 9 to the Consolidated Financial Statements in the 2022 Annual Report for further details of changes in tax rates. On 20 June 2023, Finance (No.2) Act 2023 was substantively enacted in the UK, introducing a global minimum effective tax rate of 15%. The legislation implements a domestic top-up tax and a multinational top-up tax, effective for accounting periods starting on or after 31 December 2023.
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Dividends on Ordinary Shares |
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Dividends On Ordinary Shares [Abstract] | |
Dividends on Ordinary Shares | 6. DIVIDENDS ON ORDINARY SHARES An interim dividend of £414m was declared on the Company’s ordinary shares in issue (H122: £397m).
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Derivative Financial Instruments |
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Derivative Financial Instruments | 7. DERIVATIVE FINANCIAL INSTRUMENTS The table below includes the notional amounts of transactions outstanding at the balance sheet date; they do not represent actual exposures.
(1)Derivative netting excludes the effect of cash collateral, which is offset against the gross derivative position. The amount of cash collateral received that had been offset against the gross derivative assets was £1,607m (2022: £1,368m) and the amount of cash collateral paid that had been offset against the gross derivative liabilities was £54m (2022: £70m). At 30 June 2023, the fair value of derivative assets included amounts due from Banco Santander group entities of £1,281m (2022: £1,346m) and the fair value of derivative liabilities included amounts due to Banco Santander group entities of £241m (2022: £246m). IBOR Reform Note 28 includes details of the notional value of hedging instruments by benchmark interest rate impacted by IBOR reform and the notional amounts of assets, liabilities and off-balance sheet commitments affected by IBOR reform that have yet to transition to an alternative benchmark interest rate.
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Other Financial Assets at Fair Value Through Profit or Loss |
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Other Financial Assets at Fair Value Through Profit or Loss | 8. OTHER FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
In June 2023, Santander UK revalued a portfolio of unlisted equity securities held at fair value through profit or loss in Santander Equity Investments Limited (SEIL) ahead of the sale of part of the portfolio, resulting in a gain of £46m.
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Loans and Advances to Customers |
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Loans and Advances to Customers | 9. LOANS AND ADVANCES TO CUSTOMERS
For movements in expected credit losses, see the 'Movement in total exposures and the corresponding ECL' table in the Santander UK group level - Credit risk review section of the Risk review.
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Securitisations and Covered Bonds |
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Disclosure Of Securitisations And Covered Bonds [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Securitisations and Covered Bonds | 10. SECURITISATIONS AND COVERED BONDS The information in this Note relates to securitisations and covered bonds for consolidated structured entities, used to obtain funding or collateral. It excludes structured entities relating to credit protection transactions. The gross assets securitised, or for the covered bond programme assigned at 30 June 2023 and 31 December 2022 were:
The following table sets out the internal and external issuances and redemptions in H123 and H122 for each securitisation and covered bond programme.
During H123, the remaining asset-backed notes from the Motor securitisation structure were redeemed. In H123 Repton 2023-1 Limited borrowed £550m through an asset-backed variable funding note facility. Repayment of this will begin in 2025.
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Reverse Repurchase Agreements - Non Trading |
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Disclosure Of Reserve Repurchase Agreements Non-Trading [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Reverse Repurchase Agreements - Non Trading | 11. REVERSE REPURCHASE AGREEMENTS – NON TRADING
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Interests in Other Entities |
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Jun. 30, 2023 | |
Investments accounted for using equity method [abstract] | |
Interests in Other Entities | 12. INTERESTS IN OTHER ENTITIES There have been no significant changes to the Santander UK group's interests in subsidiaries, joint ventures and unconsolidated structured entities, as set out in Note 19 to the Consolidated Financial Statements in the 2022 Annual Report.
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Intangible Assets |
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Jun. 30, 2023 | |
Disclosure of detailed information about intangible assets [abstract] | |
Intangible Assets | 13. INTANGIBLE ASSETS At 30 June 2023, intangible assets comprised goodwill of £1,199m (2022: £1,199m) and computer software of £350m (2022: £351m). At 30 June 2023, a review was performed to identify any potential impairment indicators for goodwill. No indicators of impairment were identified and so a full impairment test was not performed for the half year. At 30 June 2023, there were no significant changes in key assumptions that gave rise to an indicator of impairment. Details of the sensitivity of value in use (VIU) changes to assumptions to achieve nil headroom are set out in Note 20 to the Consolidated Financial Statements in the 2022 Annual Report.
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Property, Plant and Equipment |
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Property, Plant and Equipment | 14. PROPERTY, PLANT AND EQUIPMENT
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Other Financial Liabilities at Fair Value Through Profit or Loss |
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Other Financial Liabilities at Fair Value Through Profit or Loss | 15. OTHER FINANCIAL LIABILITIES AT FAIR VALUE THROUGH PROFIT OR LOSS
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Deposits by Customers |
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Deposits from customers [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits by Customers | 16. DEPOSITS BY CUSTOMERS
(1)Includes capital amount guaranteed / protected equity index-linked deposits of £364m (2022: £408m).
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Deposits by Banks |
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Disclosure Of Deposits From Banks [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits by Banks | 17. DEPOSITS BY BANKS
(1)Includes drawdown from the TFSME of £21.0bn (2022: £25.0bn).
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Repurchase Agreements - Non Trading |
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Disclosure Of Repurchase Agreements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Repurchase Agreements - Non Trading | 18. REPURCHASE AGREEMENTS – NON TRADING
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Debt Securities in Issue |
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Debt Securities In Issue [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Securities in Issue | 19. DEBT SECURITIES IN ISSUE
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Subordinated Liabilities |
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Subordinated liabilities [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subordinated Liabilities | 20. SUBORDINATED LIABILITIES
In H123, certain subordinated liabilities were repurchased as part of ongoing liability management exercises, resulting in a profit of £3m (H122: a loss of £1m).
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Provisions |
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Disclosure of other provisions [abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provisions | 21. PROVISIONS
An additional provision of £30m was recognised in H123, for a customer remediation exercise relating to our mortgage book. This remediation relates to the proposed refund of interest inconsistently charged on mortgage products for customers in Financial Support. A £30m provision was recognised in H123, relating to restructuring announced to employees in January 2023. In H123, other provisions included charges for operational risk provisions of £87m (H122: £78m), including fraud losses of £75m (H122: £63m).
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Retirement Benefit Plans |
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Disclosure of net defined benefit liability (asset) [abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefit Plans | 22. RETIREMENT BENEFIT PLANS The amounts recognised in the balance sheet were as follows:
An expense of £33m (H122: £30m) was recognised for defined contribution plans in the period and is included in staff costs within operating expenses (see Note 3). b) Defined benefit pension schemes The total amount released to the income statement was £16m (H122: charge of £4m).The amounts recognised in other comprehensive income were as follows:
The net assets recognised in the balance sheet were determined as follows:
Actuarial assumptions The principal actuarial assumptions used for the Scheme were:
(1) The discount rate and inflation related assumptions set out in the table above reflect the assumptions calculated based on the Scheme’s duration and cash flow profile as a whole. The actual assumptions used were determined for each section independently based on each section’s duration and cash flow profile. The majority of the liability movement in H123 was due to increased long-term index-linked gilt yields. Actuarial assumption sensitivities The sensitivity analyses below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.
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Contingent Liabilities and Commitments |
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Disclosure of contingent liabilities [abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contingent Liabilities and Commitments | 23. CONTINGENT LIABILITIES AND COMMITMENTS
Other legal actions and regulatory matters Santander UK engages in discussion, and co-operates, with the FCA, PRA, CMA and other regulators and government agencies in various jurisdictions in their supervision and review of Santander UK including reviews exercised under statutory powers, regarding its interaction with past and present customers, both as part of general thematic work and in relation to specific products, services and activities. During the ordinary course of business, Santander UK is also subject to complaints and threatened legal proceedings brought by or on behalf of current or former employees, customers, investors or other third parties, in addition to legal and regulatory reviews, challenges and tax or enforcement investigations or proceedings in various jurisdictions. All such matters are assessed periodically to determine the likelihood of Santander UK incurring a liability. In those instances where it is concluded that it is not yet probable that a quantifiable payment will be made, for example because the facts are unclear or further time is required to fully assess the merits of the case or to reasonably quantify the expected payment, no provision is made. In addition, where it is not currently practicable to estimate the possible financial effect of these matters, no provision is made. Payment Protection Insurance AXA France IARD and AXA France Vie (former GE Capital Corporation Group entities (GE Capital), known as Financial Insurance Company Ltd (FICL) and Financial Assurance Company Ltd (FACL), acquired by AXA SA in 2015) (together, AXA France) have brought a claim for £552m (plus interest) against (i) Santander Cards UK Limited (former GE Capital entity known as GE Capital Bank Limited (GECB), which was acquired by Banco Santander SA in 2008 and subsequently transferred to Santander UK plc); and (ii) Santander Insurance Services UK Limited (a Banco Santander SA subsidiary) (together the Santander Entities). The claim relates to the allocation of liability for compensation and associated costs in respect of a large number of PPI policies distributed by GECB pre-2005, which were underwritten by FICL and FACL. AXA France reduced their claim from £670m (plus interest) to £552m (plus interest) in their Re-Re-Amended Particulars of Claim dated 29 June 2023. The Santander Entities strongly refute the claim. Trial has been fixed for six weeks, beginning on 3 March 2025. There are ongoing factual issues to be resolved which may have legal consequences including in relation to liability. These issues create uncertainties which mean that it is difficult to reliably predict the outcome or the timing of the resolution of the matter. The litigation and other regulatory provision in Note 21 includes our best estimate of the Santander Entities’ liability to the specific portfolio. Further information has not been provided on the basis that it would be seriously prejudicial to the Santander Entities’ interests in connection with the dispute. In addition, and in relation to PPI more generally, the PPI provision includes an amount relating to legal claims challenging the FCA’s industry guidance on the treatment of Plevin / recurring non-disclosure assessments. This provision is based on current stock levels, future projected claims, and average redress. There remains a risk that volumes received in future may be higher than forecast. The provision in Note 21 includes our best estimate of Santander UK’s liability for the specific issue. The actual cost of customer compensation could differ from the amount provided. It is not currently practicable to provide an estimate of the risk and amount of any further financial impact. German dividend tax arbitrage transactions In June 2018 the Cologne Criminal Prosecution Office and the German Federal Tax Office commenced an investigation in relation to the historical involvement of Santander UK plc, Santander Financial Services plc and Cater Allen International Limited (all subsidiaries of Santander UK Group Holdings plc) in German dividend tax arbitrage transactions (known as cum/ex transactions). These transactions allegedly exploited a loophole of a specific German settlement mechanism through short-selling and complex derivative structuring which resulted in the German government either refunding withholding tax where such tax had not been paid or refunding it more than once. The German authorities are investigating numerous institutions and individuals in connection with alleged transactions and practices which may be found to be illegal under German law. During H123 we continued to cooperate with the German authorities and, with the assistance of external experts, to progress an internal investigation into the matters in question. From Santander UK plc’s perspective, the investigation is focused principally on the period 2009-2011 and remains on-going. There remain factual issues to be resolved which may have legal consequences including potentially material financial penalties. These issues create uncertainties which mean that it is difficult to predict the resolution of the matter including timing or the significance of the possible impact. These uncertainties mean it is not currently possible to make a reliable assessment of the size of any related potential liability. Motor Finance Broker Commissions Following the FCA’s Motor Market review, Santander Consumer (UK) plc (SCUK) has received a number of county court claims and complaints in respect of its historical commission arrangements and is monitoring industry developments for potential liabilities for claims related to the use of discretionary commission models prior to the Motor Market review. It is possible that further claims and complaints may be received. A claim has been issued against SCUK, Santander UK plc and others in the Competition Appeal Tribunal (CAT), alleging that SCUK’s historical commission arrangements in respect of used car financing operated in breach of the Competition Act 1998. While it is possible that certain costs will be incurred in relation to existing or future county court claims, complaints and the CAT proceedings, the resolution of such matters is not possible to predict with any certainty. It is also not considered that a legal or constructive obligation has been incurred in relation to such matters that would require a provision to be recognised at this stage. In view of the inherent uncertainties, it is therefore also not possible to estimate the extent of any financial impact. Taxation The Santander UK group engages in discussion, and co-operates, with HM Revenue & Customs (HMRC) in their oversight of the Santander UK group’s tax matters. The Santander UK group adopted the UK’s Code of Practice on Taxation for Banks in 2010. Other On 2 November 2015, Visa Europe Ltd agreed to sell 100% of its share capital to Visa Inc. The deal closed on 21 June 2016. As a member and shareholder of Visa Europe Ltd, Santander UK received upfront consideration made up of cash and convertible preferred stock. Following ring-fencing, the convertible preferred stock is now held by Santander Equity Investments Limited (SEIL), outside the ring-fenced bank. Conversion of the preferred stock into Class A Common Stock of Visa Inc. depends on the outcome of litigation against Visa involving UK & Ireland (UK&I) multilateral interchange fees (MIFs). In June 2020, the Supreme Court issued a judgement finding that MIFs restricted competition. In valuing the preferred stock, SEIL makes adjustments for illiquidity and the potential for changes in the conversion rate due to litigation costs. In addition, Santander UK plc and certain other UK&I banks have agreed to indemnify Visa Inc. in the event that the preferred stock is insufficient to meet the costs of this litigation. Visa Inc. has recourse to this indemnity once more than €1bn of losses relating to UK&I MIFs have arisen or once the total value of the preferred stock issued to UK&I banks on closing has been reduced to nil. Santander UK plc's liability under this indemnity is capped at €39.85m. At this stage, it is unclear whether the litigation will give rise to more than €1bn of losses relating to UK&I MIFs which means it is not practicable to predict the resolution of the matter including the timing or the significance of the possible impact. As part of the sale of subsidiaries, businesses and other entities, and as is normal in such circumstances, entities within the Santander UK group have given warranties and/or indemnities to the purchasers.
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Other Equity Instruments |
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Disclosure of classes of share capital [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Equity Instruments | 24. OTHER EQUITY INSTRUMENTS
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Assets Charged as Security for Liabilities and Collateral Accepted as Security for Assets |
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Jun. 30, 2023 | |
Disclosure Of Assets Pledged As Security [Abstract] | |
Assets Charged as Security for Liabilities and Collateral Accepted as Security for Assets | 25. ASSETS CHARGED AS SECURITY FOR LIABILITIES AND COLLATERAL ACCEPTED AS SECURITY FOR ASSETS Securitisations and covered bonds As described in Note 14, to the Consolidated Financial Statements in the 2022 Annual Report and Note 10, Santander UK plc and certain of its subsidiaries issue securitisations and covered bonds. At 30 June 2023, there were £25,646m (2022: £24,984m) of gross assets in these secured programmes and £775m (2022: £829m) of these related to internally retained issuances that were available for use as collateral for liquidity purposes in the future. At 30 June 2023, £2,875m (2022: £1,725m) of notes issued under securitisation and covered bond programmes had been retained internally, a proportion of which had been used as collateral via third party bilateral secured funding transactions, which totalled £1,500m at 30 June 2023 (2022: £500m), or for use as collateral for liquidity purposes in the future.
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Related Party Disclosures |
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Jun. 30, 2023 | |
Disclosure of transactions between related parties [abstract] | |
Related Party Disclosures | 26. RELATED PARTY DISCLOSURES The financial position and performance of the Santander UK group were not materially affected in H123 by any related party transactions, or changes to related party transactions, other than as disclosed herein.
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Financial Instruments |
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Disclosure Of Fair Value Measurement Of Assets And Liabilities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments | 27. FINANCIAL INSTRUMENTS a) Measurement basis of financial assets and liabilities Disclosures relating to fair value measurement and hierarchy, valuation techniques and the control framework and related aspects pertaining to financial instruments at fair value are included in the 2022 Annual Report. Valuation, sensitivity methodologies and inputs at 30 June 2023 are consistent with those described in Note 39 to the Consolidated Financial Statements in the 2022 Annual Report. Details regarding fair value measurement under a valuation technique of groups of financial assets and liabilities with offsetting positions in market risks or credit risks, on the basis of net exposure using the exception under IFRS 13, can be found in Note 39(a) to the Consolidated Financial Statements in the 2022 Annual Report. b) Fair values of financial instruments carried at amortised cost The following tables analyse the fair value of the financial instruments carried at amortised cost at 30 June 2023 and 31 December 2022. Cash and balances at central banks, which consist of demand deposits with the Bank of England, together with cash in tills and ATMs, have been excluded from the table as the carrying amount is deemed an appropriate approximation of fair value. Details of the valuation methodology of the financial assets and financial liabilities carried at amortised cost can be found in Note 39(d) to the Consolidated Financial Statements in the 2022 Annual Report.
c) Fair values of financial instruments measured at fair value The following tables summarise the fair values of the financial assets and liabilities accounted for at fair value at 30 June 2023 and 31 December 2022, analysed by their levels in the fair value hierarchy - Level 1, Level 2 and Level 3.
Transfers between levels of the fair value hierarchy In H123 there were no significant (H122: no significant) transfers of financial instruments between levels of the fair value hierarchy. d) Valuation techniques The main valuation techniques employed in internal models to measure the fair value of the financial instruments are disclosed in Note 39(b) to the Consolidated Financial Statements in the 2022 Annual Report. Santander UK made a material change to the valuation of unlisted equity holdings in H123. For more details, see Note 8. e) Fair value adjustments The internal models incorporate assumptions that Santander UK believes would be made by a market participant to establish fair value. Fair value adjustments are adopted when Santander UK considers that there are additional factors that would be considered by a market participant that are not incorporated in the valuation model. Santander UK classifies fair value adjustments as either ‘risk-related’ or ‘model-related’. The fair value adjustments form part of the portfolio fair value and are included in the balance sheet values of the product types to which they have been applied. The fair value adjustments are set out in the following table:
Risk-related adjustments Risk-related adjustments are driven, in part, by the magnitude of Santander UK’s market or credit risk exposure, and by external market factors, such as the size of market spreads. For more details, see ‘Risk-related adjustments’ in Note 39(f) to the Consolidated Financial Statements in the 2022 Annual Report. f) Internal models based on information other than market data (Level 3) Valuation techniques There have been no significant changes to the valuation techniques as set out in Note 39(g) to the Consolidated Financial Statements in the 2022 Annual Report. Reconciliation of fair value measurement in Level 3 of the fair value hierarchy The following table sets out the movements in Level 3 financial instruments in H123:
(1)This relates to the effect of netting on the fair value of the credit linked notes due to a legal right of set-off between the principal amounts of the senior notes and the associated cash deposits. For more, see ‘ii) Credit protection entities’ in Note 19 to the Consolidated Financial Statements in the 2022 Annual Report (2)Fair value movements relating to derivatives and other financial assets at FVTPL are recognised in other operating income in the income statement. Effect of changes in significant unobservable assumptions to reasonably possible alternatives (Level 3) There has been no significant change to the unobservable inputs and sensitivities used in Level 3 fair values as set out in Note 39(g) to the Consolidated Financial Statements in the 2022 Annual Report.
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Interest Rate Benchmark Reform |
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Interest Rate Benchmark Reform [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest Rate Benchmark Reform | 28. INTEREST RATE BENCHMARK REFORM The following tables show the notional amounts of assets, liabilities and off-balance sheet commitments at 30 June 2023 and 31 December 2022 affected by IBOR reform that have yet to transition to an alternative benchmark interest rate as provided internally to key management personnel.
(1) Many of the Santander UK group's derivatives subject to IBOR reform are standard ISDA contracts and are subject to supplementary ISDA fallback provisions which became effective on 25 January 2021. (2) Settings for GBP, JPY & NOK LIBOR & 1-week and 2-month USD LIBOR ceased on 31 December 2021 and for EONIA on 3 January 2022. For certain legacy contracts, while 1-month, 3-month and 6-month settings for JPY LIBOR ceased on 31 December 2022 and 1-month and 6-month synthetic GBP LIBOR settings ceased on 31 March 2023, the 3-month synthetic GBP LIBOR setting has been extended until the end of March 2024. Overnight, and 12-month USD LIBOR settings ceased on 30 June 2023. For certain legacy contracts, 1-month, 3-month and 6-month synthetic USD LIBOR settings will cease on 30 September 2024. IBOR Reform The table below shows the notional amount of derivatives in hedging relationships directly affected by uncertainties related to IBOR reform.
(1) Overnight and 12-month USD LIBOR settings ceased on 30 June 2023. For certain legacy contracts, 1-month, 3-month and 6-month synthetic USD LIBOR settings will cease at the end of September 2024. For more details on interest rate benchmark reform and the Santander UK group’s transition from IBORs to alternative benchmark rates, see Note 41 to the Consolidated Financial Statements in the 2022 Annual Report.
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Assets Held for Sale |
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Discontinued Operations and Assets and Liabilities Held for Sale [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets Held for Sale | 29. ASSETS HELD FOR SALE Sale of property Management considered the sale of Santander House and Shenley Wood freehold land and buildings, part of an agreement with the developer for the construction of Unity Place, to be highly probable at the balance sheet date. As such, the Santander UK group classified these properties, which are included in the Corporate Centre segment and carried at their sales prices, as held for sale. The sale is expected to complete in H2 2023 with no gain or loss. At 30 June 2023, assets held for sale comprised:
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Events After the Balance Sheet Date |
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Disclosure of non-adjusting events after reporting period [abstract] | |
Events After the Balance Sheet Date | 30. EVENTS AFTER THE BALANCE SHEET DATE There have been no significant events between 30 June 2023 and the date of approval of these financial statements which would require a change to or additional disclosure in the financial statements.
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Accounting Policies (Policies) |
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Disclosure Of Significant Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of preparation and accounting developments | The financial information in these Condensed Consolidated Interim Financial Statements is unaudited and does not constitute statutory accounts as defined in section 434 of the UK Companies Act 2006. Statutory accounts for the year ended 31 December 2022 have been delivered to the Registrar of Companies. The Condensed Consolidated Interim Financial Statements reflect all adjustments that, in the opinion of management, are necessary for a fair statement of the results of operations for the interim period. All such adjustments to the financial information are of a normal, recurring nature. Because the results from common banking activities are so closely related and responsive to changes in market conditions, the results for any interim period are not necessarily indicative of the results that can be expected for the year. The Condensed Consolidated Interim Financial Statements have been prepared in accordance with International Accounting Standard IAS 34 ‘Interim Financial Reporting', as issued by the International Accounting Standards Board (IASB) and adopted in the UK, and the Disclosure Guidance and Transparency Rules sourcebook of the UK's Financial Conduct Authority (FCA). They do not include all the information and disclosures normally required for full annual financial statements and should be read in conjunction with the Consolidated Financial Statements of Santander UK Group Holdings plc (the Company) and its subsidiaries (collectively Santander UK or the Santander UK group) for the year ended 31 December 2022 which were prepared in accordance with UK-adopted International Accounting Standards (IAS). Those consolidated financial statements were also prepared in accordance with IFRSs as issued by the IASB, including interpretations issued by the IFRS Interpretations Committee, as there were no applicable differences from IFRSs as issued by the IASB for the periods presented. The same accounting policies, presentation and methods of computation are followed in these Condensed Consolidated Interim Financial Statements as were applied in the presentation of the Santander UK group’s 2022 Annual Report.
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Going concern | Going concern In light of geopolitical and economic uncertainty, the Directors updated their going concern assessment in preparing these Condensed Consolidated Interim Financial Statements. In making their going concern assessment, the Directors considered a wide range of information that included Santander UK's long term business and strategic plans, forecasts and projections, estimated capital, funding and liquidity requirements, contingent liabilities and the reasonably possible changes in trading performance arising from potential economic, market and product developments. After making enquiries, the Directors have a reasonable expectation that Santander UK has adequate resources to continue in operational existence for at least twelve months from the date of this report and, therefore, having reassessed the principal risks and uncertainties, the Directors consider it appropriate for the Condensed Consolidated Interim Financial Statements to be prepared on a going concern basis.
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Critical judgements and accounting estimates | Critical judgements and accounting estimates The preparation of the Condensed Consolidated Interim Financial Statements in accordance with IFRS requires management to make judgements and assumptions in applying the accounting policies that affect the reported amounts of assets, liabilities, income and expenses. Due to the inherent uncertainty in making estimates, actual results reported in future periods may be based on amounts which differ from those estimates. Estimates, judgements and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. There has been no change in the inherent sensitivity of the areas of judgement in the period. Management have considered the impact of developments in principal risks and uncertainties, as set out in the Risk review, on critical judgements and accounting estimates. The significant judgements, apart from those involving estimation, made by management in applying Santander UK's accounting policies in these financial statements (key judgements) and the key sources of estimation uncertainty that may have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year (key estimates), which together are considered critical to Santander UK's results and financial position, are as follows: a) Credit impairment charges
For more on each of these key judgements and estimates, see 'Critical judgements and accounting estimates applied in calculating ECL' in the ‘Credit risk – credit risk management’ section of the Risk review in the 2022 Annual Report. Sensitivity of ECL allowance For detailed disclosures, see 'Sensitivity of ECL allowance' in the ‘Credit risk – credit risk management’ section of the Risk review. b) Provisions and contingent liabilities
Included in Litigation and other regulatory provisions in Note 21 are amounts in respect of management’s best estimates of liability relating to a legal dispute regarding allocation of responsibility for a specific PPI portfolio of complaints, and Plevin related litigation. Note 23 provides disclosure relating to ongoing factual issues and reviews that could impact the timing and amount of any outflows. Note 23 includes disclosure relating to an investigation in relation to the historical involvement of Santander UK plc, Santander Financial Services plc and Cater Allen International Limited (all subsidiaries of Santander UK Group Holdings plc) in German dividend tax arbitrage transactions. These judgements are based on the specific facts available and often require specialist professional advice. There can be a wide range of possible outcomes and uncertainties, particularly in relation to legal actions, and regulatory and consumer credit matters. As a result, it is often not possible to make reliable estimates of the likelihood and amount of any potential outflows, or to calculate any resulting sensitivities. For more on these key judgements and estimates, see Notes 21 and 23. c) Pensions
For more on each of these key judgements and estimates, see Note 22. Sensitivity of defined benefit pension scheme estimates For detailed disclosures, see ‘Actuarial assumption sensitivities’ in Note 22. The Scheme is invested in certain assets whose values are not based on market observable data, such as investments in private equity funds and property. Due diligence has been conducted to support the values obtained in respect of these assets are appropriate and represent fair value. Given the nature of these investments, we are unable to prepare sensitivities on how their values could vary as market conditions or other variables change. d) Goodwill
For more on each of these key judgements and estimates, see Note 13. Sensitivity of goodwill For detailed disclosures, see ‘Sensitivities of key assumptions in calculating VIU’ in Note 20 to the Consolidated Financial Statements in the 2022 Annual Report.
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Accounting Policies (Tables) |
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Disclosure Of Significant Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Information about Key Judgements and Key Estimates |
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Segments (Tables) |
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Disclosure of operating segments [abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Results by Segment | Results by segment For the Half Year to
(1)The disaggregation of fees and commission income as shown above is not included in reports provided to the chief operating decision maker but is provided to show the split by reportable segments. (2)Non-banking and other fees include mortgages (except mortgage account fees), consumer finance, commitment commission, asset finance, invoice finance and trade finance. (3)Includes customer loans, net of credit impairment charge allowances.
(2)Non-banking and other fees include mortgages (except mortgage account fees), consumer finance, commitment commission, asset finance, invoice finance and trade finance. (3)Includes customer loans, net of credit impairment charge allowances..
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Operating Expenses Before Credit Impairment Charges, Provisions and Charges (Tables) |
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Expenses by nature [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Operating Expenses Before Credit Impairment Losses, Provisions and Charges | For the Half Year to
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Credit Impairment Charges and Provisions (Tables) |
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Disclosure Of Credit Impairment Loss And Provisions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Impairment Losses and Provisions |
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Taxation (Tables) |
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Major components of tax expense (income) [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Tax on Profit Before Tax Differs from Theoretical Amount that Arise Using Basic Corporation Tax Rate | ). The tax on profit before tax differs from the theoretical amount that would arise using the basic corporation tax rate as follows: For the Half Year to
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Derivative Financial Instruments (Tables) |
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Disclosure of nature and extent of risks arising from financial instruments [abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Notional Amounts and Fair Values of Derivatives | The table below includes the notional amounts of transactions outstanding at the balance sheet date; they do not represent actual exposures.
(1)Derivative netting excludes the effect of cash collateral, which is offset against the gross derivative position. The amount of cash collateral received that had been offset against the gross derivative assets was £1,607m (2022: £1,368m) and the amount of cash collateral paid that had been offset against the gross derivative liabilities was £54m (2022: £70m).
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Other Financial Assets at Fair Value Through Profit or Loss (Tables) |
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Financial assets at fair value through profit or loss [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Other Financial Assets at Fair Value Through Profit or Loss |
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Loans and Advances to Customers (Tables) |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Loans And Advances To Customers [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Net Loans and Advances to Customers |
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Securitisations and Covered Bonds (Tables) |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure Of Securitisations And Covered Bonds [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Analysis of Securitisations and Covered Bonds | The gross assets securitised, or for the covered bond programme assigned at 30 June 2023 and 31 December 2022 were:
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Summary of Issuances and Redemptions of Securitisation and Covered Bond Programme | The following table sets out the internal and external issuances and redemptions in H123 and H122 for each securitisation and covered bond programme.
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Reverse Repurchase Agreements - Non Trading (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure Of Reserve Repurchase Agreements Non-Trading [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Reverse Repurchase Agreements - Non Trading |
|
Property, Plant and Equipment (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, plant and equipment [abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Detailed Information about Property, Plant and Equipment |
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Other Financial Liabilities at Fair Value Through Profit or Loss (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of financial liabilities [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Other Financial Liabilities at Fair Value Through Profit or Loss |
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Deposits by Customers (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits from customers [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Deposits by Customers |
(1)Includes capital amount guaranteed / protected equity index-linked deposits of £364m (2022: £408m).
|
Deposits by Banks (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure Of Deposits From Banks [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Deposits by Banks |
(1)Includes drawdown from the TFSME of £21.0bn (2022: £25.0bn).
|
Repurchase Agreements - Non Trading (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure Of Repurchase Agreements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Repurchase Agreements - Non Trading |
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Debt Securities in Issue (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Securities In Issue [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Debt Securities in Issue |
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Subordinated Liabilities (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subordinated liabilities [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Subordinated Liabilities |
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Provisions (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of other provisions [abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Provisions Reconciliation |
|
Retirement Benefit Plans (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of net defined benefit liability (asset) [abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Retirement Benefit Plans | The amounts recognised in the balance sheet were as follows:
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Summary of Amounts Recognised in Other Comprehensive Income | The amounts recognised in other comprehensive income were as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Net Assets Recognised | The net assets recognised in the balance sheet were determined as follows:
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Summary of Principal Actuarial Assumptions Used for Defined Benefit Schemes | The principal actuarial assumptions used for the Scheme were:
(1) The discount rate and inflation related assumptions set out in the table above reflect the assumptions calculated based on the Scheme’s duration and cash flow profile as a whole. The actual assumptions used were determined for each section independently based on each section’s duration and cash flow profile.
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Summary of Actuarial Assumption Sensitivities | The sensitivity analyses below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.
|
Contingent Liabilities and Commitments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of contingent liabilities [abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Contingent Liabilities and Commitments |
|
Other Equity Instruments (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of classes of share capital [abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Other Equity Instruments |
|
Financial Instruments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure Of Fair Value Measurement Of Assets And Liabilities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Analysis of Fair Value of Financial Instruments Carried at Amortised Cost | The following tables analyse the fair value of the financial instruments carried at amortised cost at 30 June 2023 and 31 December 2022. Cash and balances at central banks, which consist of demand deposits with the Bank of England, together with cash in tills and ATMs, have been excluded from the table as the carrying amount is deemed an appropriate approximation of fair value. Details of the valuation methodology of the financial assets and financial liabilities carried at amortised cost can be found in Note 39(d) to the Consolidated Financial Statements in the 2022 Annual Report.
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Disclosure of Analysis of Fair Value of Financial Instruments Measured at Fair Value on a Recurring Basis | The following tables summarise the fair values of the financial assets and liabilities accounted for at fair value at 30 June 2023 and 31 December 2022, analysed by their levels in the fair value hierarchy - Level 1, Level 2 and Level 3.
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Summary of Fair Value Adjustment | The fair value adjustments are set out in the following table:
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Summary of Reconciliation of Fair Value Measurement in Level 3 of the Fair Value Hierarchy | The following table sets out the movements in Level 3 financial instruments in H123:
(1)This relates to the effect of netting on the fair value of the credit linked notes due to a legal right of set-off between the principal amounts of the senior notes and the associated cash deposits. For more, see ‘ii) Credit protection entities’ in Note 19 to the Consolidated Financial Statements in the 2022 Annual Report (2)Fair value movements relating to derivatives and other financial assets at FVTPL are recognised in other operating income in the income statement.
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Interest Rate Benchmark Reform (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest Rate Benchmark Reform [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Amounts Affected by IBOR Reform | The following tables show the notional amounts of assets, liabilities and off-balance sheet commitments at 30 June 2023 and 31 December 2022 affected by IBOR reform that have yet to transition to an alternative benchmark interest rate as provided internally to key management personnel.
(1) Many of the Santander UK group's derivatives subject to IBOR reform are standard ISDA contracts and are subject to supplementary ISDA fallback provisions which became effective on 25 January 2021. (2) Settings for GBP, JPY & NOK LIBOR & 1-week and 2-month USD LIBOR ceased on 31 December 2021 and for EONIA on 3 January 2022. For certain legacy contracts, while 1-month, 3-month and 6-month settings for JPY LIBOR ceased on 31 December 2022 and 1-month and 6-month synthetic GBP LIBOR settings ceased on 31 March 2023, the 3-month synthetic GBP LIBOR setting has been extended until the end of March 2024. Overnight, and 12-month USD LIBOR settings ceased on 30 June 2023. For certain legacy contracts, 1-month, 3-month and 6-month synthetic USD LIBOR settings will cease on 30 September 2024.
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Schedule of Derivatives Directly Affected by IBOR Reform Uncertainties | The table below shows the notional amount of derivatives in hedging relationships directly affected by uncertainties related to IBOR reform.
(1) Overnight and 12-month USD LIBOR settings ceased on 30 June 2023. For certain legacy contracts, 1-month, 3-month and 6-month synthetic USD LIBOR settings will cease at the end of September 2024.
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Assets Held for Sale (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Assets and Liabilities Held for Sale [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Assets Classified as Held for Sale | At 30 June 2023, assets held for sale comprised:
|
Segments - Additional Information (Details) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023
GBP (£)
segment
|
Jun. 30, 2022
GBP (£)
|
|
Disclosure of operating segments [line items] | ||
Number of segments | segment | 4 | |
Profit before tax | £ 1,173 | £ 993 |
Corporate & Commercial Banking | ||
Disclosure of operating segments [line items] | ||
Profit before tax | 270 | 148 |
Corporate Centre | ||
Disclosure of operating segments [line items] | ||
Profit before tax | £ (71) | (102) |
Reclassified amounts | Corporate & Commercial Banking | ||
Disclosure of operating segments [line items] | ||
Profit before tax | 1 | |
Reclassified amounts | Corporate Centre | ||
Disclosure of operating segments [line items] | ||
Profit before tax | £ (1) |
Operating Expenses Before Credit Impairment Charges, Provisions and Charges - Summary of Operating Expenses Before Credit Impairment Losses, Provisions and Charges (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Expenses by nature [abstract] | ||
Staff costs | £ 621 | £ 567 |
Other administration expenses | 476 | 461 |
Depreciation, amortisation and impairment | 135 | 158 |
Total operating expenses before impairment losses, provisions and charges | £ 1,232 | £ 1,186 |
Operating Expenses Before Credit Impairment Charges, Provisions and Charges - Additional Information (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Accumulated depreciation | Branch and head office site closures | ||
Operating Expenses Before Credit Impairment Losses Provision And Charges [Line Items] | ||
Impairment during the period | £ 2 | £ 10 |
Credit Impairment Charges and Provisions - Summary of Impairment Losses and Provisions (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Credit impairment charges/(write-backs): | ||
Loans and advances to customers | £ 98 | £ 114 |
Recoveries of loans and advances, net of collection costs | 4 | (6) |
Off-balance sheet credit exposures (See Note 21) | 3 | 10 |
Impairment loss on financial assets | 105 | 118 |
Provisions for other liabilities and charges (excluding off-balance sheet credit exposures) (See Note 21) | 149 | 121 |
Releases for residual value and voluntary termination | (1) | (3) |
Provisions for other liabilities and charges | 148 | 118 |
Total operating credit impairment (charges)/write-backs, provisions and charges | £ 253 | £ 236 |
Credit Impairment Charges and Provisions - Additional Information (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Disclosure Of Credit Impairment Loss And Provisions [Abstract] | ||
Impairment losses on loans and advances to banks | £ 0 | £ 0 |
Impairment losses on non-trading reverse repurchase agreements | 0 | 0 |
Impairment losses on other financial assets at amortised cost | 0 | 0 |
Impairment losses on financial assets at FVOCI | £ 0 | £ 0 |
Taxation - Additional Information (Details) |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Income Tax Expense Benefits [Line Items] | ||
Effective tax rate (percentage) | 26.90% | 23.50% |
Forecast | ||
Income Tax Expense Benefits [Line Items] | ||
Effective tax rate (percentage) | 26.90% | 25.70% |
Taxation - Schedule of Tax on Profit Before Tax Differs from Theoretical Amount that Arise Using Basic Corporation Tax Rate (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Major components of tax expense (income) [abstract] | ||
Profit before tax | £ 1,173 | £ 993 |
Tax calculated at a tax rate of 23.5% (H122:19%) | 276 | 189 |
Bank surcharge on profits | 45 | 70 |
Non-deductible preference dividends paid | 5 | 5 |
Non-deductible UK Bank Levy | 9 | 8 |
Non-deductible conduct remediation, fines and penalties | 4 | (1) |
Other non-deductible costs and non-taxable income | (4) | 6 |
Effect of change in tax rate on deferred tax provision | 0 | (22) |
Tax relief on dividends in respect of other equity instruments | (20) | (22) |
Tax on profit | £ 315 | £ 233 |
Dividends on Ordinary Shares (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Dividends On Ordinary Shares [Abstract] | ||
Dividends declared and paid | £ 414 | £ 397 |
Derivative Financial Instruments - Additional Information (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|---|
Disclosure of detailed information about hedges | |||
Derivative financial assets | £ 2,592 | £ 2,439 | |
Derivative financial liabilities | 1,570 | 1,008 | |
Fair value | |||
Disclosure of detailed information about hedges | |||
Derivative financial assets | 2,592 | 2,439 | |
Derivative financial liabilities | 1,570 | £ 1,008 | |
Group entities | Fair value | |||
Disclosure of detailed information about hedges | |||
Derivative financial assets | 1,281 | £ 1,346 | |
Derivative financial liabilities | £ 241 | £ 246 |
Other Financial Assets at Fair Value Through Profit or Loss - Summary of Other Financial Assets at Fair Value Through Profit or Loss (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Disclosure Of Other Financial Assets At Fair Value Through Profit Or Loss [Line Items] | ||
Financial assets at fair value through profit or loss | £ 614 | £ 434 |
Loans and advances to customers | ||
Disclosure Of Other Financial Assets At Fair Value Through Profit Or Loss [Line Items] | ||
Financial assets at fair value through profit or loss | 322 | 339 |
Debt securities | ||
Disclosure Of Other Financial Assets At Fair Value Through Profit Or Loss [Line Items] | ||
Financial assets at fair value through profit or loss | 219 | 85 |
Equity securities | ||
Disclosure Of Other Financial Assets At Fair Value Through Profit Or Loss [Line Items] | ||
Financial assets at fair value through profit or loss | £ 73 | £ 10 |
Other Financial Assets at Fair Value Through Profit or Loss - Additional Information (Details) £ in Millions |
1 Months Ended |
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Jun. 30, 2023
GBP (£)
| |
Santander Equity Investments Limited (SEIL) | Equity securities | |
Disclosure Of Financial Assets Designated As Measured At Fair Value Through Profit Or Loss [Line Items] | |
Gains (losses) on financial assets at fair value through profit or loss | £ 46 |
Loans and Advances to Customers (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Net Loans And Advances To Customers [Abstract] | ||
Loans and advances to customers | £ 215,973 | £ 224,795 |
Credit impairment loss allowances on loans and advances to customers | (942) | (933) |
Residual value and voluntary termination provisions on finance leases | (21) | (22) |
Net loans and advances to customers | £ 215,010 | £ 223,840 |
Securitisations and Covered Bonds - Additional Information (Details) - External - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Disclosure Of Securitisations And Covered Bonds [Line Items] | ||
Internal and external issuances | £ 2,800 | £ 4,182 |
Repton | Other asset-backed securitisation structures | ||
Disclosure Of Securitisations And Covered Bonds [Line Items] | ||
Internal and external issuances | £ 550 | £ 0 |
Reverse Repurchase Agreements - Non Trading (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Disclosure Of Reserve Repurchase Agreements Non-Trading [Line Items] | ||
Reverse repurchase agreements - non trading | £ 12,024 | £ 7,348 |
Agreements with banks | ||
Disclosure Of Reserve Repurchase Agreements Non-Trading [Line Items] | ||
Reverse repurchase agreements - non trading | 1,253 | 885 |
Agreements with customers | ||
Disclosure Of Reserve Repurchase Agreements Non-Trading [Line Items] | ||
Reverse repurchase agreements - non trading | £ 10,771 | £ 6,463 |
Intangible Assets (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Disclosure of detailed information about intangible assets [line items] | ||
Goodwill | £ 1,199 | £ 1,199 |
Computer software | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets other than goodwill | £ 350 | £ 351 |
Deposits by Customers (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Disclosure Of Deposits From Customers [Line Items] | ||
Deposits by customers | £ 191,638 | £ 197,313 |
Demand and time deposits | ||
Disclosure Of Deposits From Customers [Line Items] | ||
Deposits by customers | 190,534 | 196,160 |
Amounts due to fellow Banco Santander subsidiaries and joint ventures | ||
Disclosure Of Deposits From Customers [Line Items] | ||
Deposits by customers | 1,104 | 1,153 |
Equity index linked deposits | ||
Disclosure Of Deposits From Customers [Line Items] | ||
Capital amount guaranteed or protected | £ 364 | £ 408 |
Deposits by Banks (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Disclosure Of Deposits From Banks [Line Items] | ||
Deposits by banks | £ 25,602 | £ 28,543 |
Drawdown from TFSME | 21,000 | 25,000 |
Items in the course of transmission | ||
Disclosure Of Deposits From Banks [Line Items] | ||
Deposits by banks | 531 | 701 |
Deposits held as collateral | ||
Disclosure Of Deposits From Banks [Line Items] | ||
Deposits by banks | 1,631 | 1,758 |
Other deposits | ||
Disclosure Of Deposits From Banks [Line Items] | ||
Deposits by banks | £ 23,440 | £ 26,084 |
Repurchase Agreements - Non Trading (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Disclosure Of Repurchase Agreements [Line Items] | ||
Repurchase agreements - non trading | £ 9,853 | £ 7,982 |
Agreements with banks | ||
Disclosure Of Repurchase Agreements [Line Items] | ||
Repurchase agreements - non trading | 406 | 50 |
Agreements with customers | ||
Disclosure Of Repurchase Agreements [Line Items] | ||
Repurchase agreements - non trading | £ 9,447 | £ 7,932 |
Debt Securities in Issue (Details) £ in Millions |
Jun. 30, 2023
GBP (£)
|
Jun. 30, 2023
EUR (€)
|
Jun. 30, 2023
USD ($)
|
Dec. 31, 2022
GBP (£)
|
Dec. 31, 2022
EUR (€)
|
Dec. 31, 2022
USD ($)
|
Jun. 30, 2022
EUR (€)
|
---|---|---|---|---|---|---|---|
Debt Securities In Issue [Line Items] | |||||||
Debt securities | £ 35,083 | £ 36,420 | |||||
Notional amount | 210,222 | 177,802 | |||||
Medium-term notes | |||||||
Debt Securities In Issue [Line Items] | |||||||
Debt securities | 14,182 | 15,533 | |||||
Euro 35bn Global Covered Bond Programme | |||||||
Debt Securities In Issue [Line Items] | |||||||
Debt securities | 15,247 | 15,205 | |||||
Notional amount | € | € 35,000,000,000 | € 35,000,000,000 | € 35,000,000,000 | ||||
US$20bn Commercial Paper Programmes | |||||||
Debt Securities In Issue [Line Items] | |||||||
Debt securities | 1,591 | 1,851 | |||||
Notional amount | $ | $ 20,000,000,000 | $ 20,000,000,000 | |||||
Certificates of deposit | |||||||
Debt Securities In Issue [Line Items] | |||||||
Debt securities | 1,975 | 2,874 | |||||
Credit linked notes | |||||||
Debt Securities In Issue [Line Items] | |||||||
Credit linked notes | 0 | 60 | |||||
Securitisation programmes | |||||||
Debt Securities In Issue [Line Items] | |||||||
Debt securities | £ 2,088 | £ 897 |
Subordinated Liabilities - Schedule of Subordinated Liabilities (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Subordinated liabilities [abstract] | ||
£325m Sterling preference shares | £ 344 | £ 344 |
Undated subordinated liabilities | 205 | 219 |
Dated subordinated liabilities | 1,601 | 1,769 |
Subordinated liabilities | 2,150 | 2,332 |
£325m Sterling preference shares, notional amount | £ 325 | £ 325 |
Subordinated Liabilities - Additional Information (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Subordinated liabilities [abstract] | ||
Loss on repurchase of subordinated liabilities | £ 3 | £ (1) |
Provisions - Additional Information (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Disclosure of other provisions [line items] | ||
Additional provisions | £ 175 | |
Customer remediation | ||
Disclosure of other provisions [line items] | ||
Additional provisions | 30 | |
Restructuring provision, January 2023 | ||
Disclosure of other provisions [line items] | ||
Additional provisions | 30 | |
Operational risk provisions | ||
Disclosure of other provisions [line items] | ||
Additional provisions | 87 | £ 78 |
Fraud losses | ||
Disclosure of other provisions [line items] | ||
Additional provisions | £ 75 | £ 63 |
Retirement Benefit Plans - Summary of Retirement Benefit Plans (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Net change in operating assets and liabilities: | ||
Total net assets | £ 974 | £ 1,026 |
Unfunded pension and post-retirement medical benefits | ||
Net change in operating assets and liabilities: | ||
Surplus (deficit) in plan | (25) | (25) |
Surplus | Funded defined benefit pension scheme | ||
Net change in operating assets and liabilities: | ||
Surplus (deficit) in plan | £ 999 | £ 1,051 |
Retirement Benefit Plans - Additional Information (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Disclosure of net defined benefit liability (asset) [abstract] | ||
Defined contribution expense | £ 33 | £ 30 |
Defined benefit expense | £ (16) | £ 4 |
Retirement Benefit Plans - Summary of Amounts Recognised in Other Comprehensive Income (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Disclosure of net defined benefit liability (asset) [abstract] | ||
Return on plan assets (excluding amounts included in net interest expense) | £ 470 | £ 3,352 |
Actuarial losses arising from experience adjustments | 89 | 296 |
Actuarial gains arising from changes in financial assumptions | (399) | (3,974) |
Pension remeasurement | £ 160 | £ (326) |
Retirement Benefit Plans - Summary of Net Assets Recognised (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Disclosure of net defined benefit liability (asset) [abstract] | ||
Present value of defined benefit obligations | £ (7,639) | £ (7,937) |
Fair value of scheme assets | 8,613 | 8,963 |
Net defined benefit assets | £ 974 | £ 1,026 |
Retirement Benefit Plans - Summary of Principal Actuarial Assumptions Used for Defined Benefit Schemes (Details) |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Disclosure of net defined benefit liability (asset) [abstract] | |||
– Discount rate for scheme liabilities | 530.00% | 4.90% | |
– General price inflation | 310.00% | 3.10% | |
– General salary increase | 100.00% | 1.00% | |
– Expected rate of pension increase | 300.00% | 3.00% | |
Longevity at 60 for current pensioners, on the valuation date: | |||
– Males | 27 years 4 months 24 days | 27 years 4 months 24 days | |
– Females | 30 years 1 month 6 days | 30 years 1 month 6 days | |
Longevity at 60 for future pensioners currently aged 40, on the valuation date: | |||
– Males | 28 years 10 months 24 days | 28 years 10 months 24 days | |
– Females | 31 years 7 months 6 days | 31 years 7 months 6 days |
Retirement Benefit Plans - Summary of Actuarial Assumption Sensitivities (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Discount rate | ||
Disclosure of sensitivity analysis for actuarial assumptions [line items] | ||
Percentage of reasonably possible increase in actuarial assumption | 0.50% | |
Description of changes in methods and assumptions | bps increase | |
Increase (decrease) in defined benefit obligation | £ (466) | £ (501) |
General price inflation | ||
Disclosure of sensitivity analysis for actuarial assumptions [line items] | ||
Percentage of reasonably possible increase in actuarial assumption | 0.50% | |
Description of changes in methods and assumptions | bps increase | |
Increase (decrease) in defined benefit obligation | £ 341 | 374 |
Mortality | ||
Disclosure of sensitivity analysis for actuarial assumptions [line items] | ||
Description of changes in methods and assumptions | Each additional year of longevity assumed | |
Increase (decrease) in defined benefit obligation | £ 185 | £ 203 |
Contingent Liabilities and Commitments - Summary of Contingent Liabilities and Commitments (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Disclosure Of Contingent Liabilities And Commitments [Line Items] | ||
Guarantees and formal standby facilities, credit lines and other commitments | £ 33,725 | £ 31,858 |
Contingent liability for guarantees | ||
Disclosure Of Contingent Liabilities And Commitments [Line Items] | ||
Guarantees given to third parties | 436 | 448 |
Loan commitments | ||
Disclosure Of Contingent Liabilities And Commitments [Line Items] | ||
Formal standby facilities, credit lines and other commitments | £ 33,289 | £ 31,410 |
Contingent Liabilities and Commitments - Additional Information (Details) £ in Millions |
6 Months Ended | |||
---|---|---|---|---|
Nov. 02, 2015 |
Jun. 30, 2023
EUR (€)
|
Jun. 29, 2023
GBP (£)
|
Oct. 21, 2022
GBP (£)
|
|
Minimum | ||||
Disclosure Of Contingent Liabilities And Commitments [Line Items] | ||||
Losses on litigation settlements | € 1,000,000,000 | |||
Maximum | ||||
Disclosure Of Contingent Liabilities And Commitments [Line Items] | ||||
Santander UK liability under indemnity cap | 39,850,000 | |||
AXA France | ||||
Disclosure Of Contingent Liabilities And Commitments [Line Items] | ||||
Amount claimed by other party | £ | £ 552 | £ 670 | ||
UK&I Banks | ||||
Disclosure Of Contingent Liabilities And Commitments [Line Items] | ||||
Preferred stock issued, threshold value | € 0 | |||
Visa Europe Ltd | ||||
Disclosure Of Contingent Liabilities And Commitments [Line Items] | ||||
Visa Europe Ltd sale to Visa Inc | 100.00% |
Assets Charged as Security for Liabilities and Collateral Accepted as Security for Assets (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Disclosure Of Assets Pledged As Security [Line Items] | ||
Gross assets charged as security for liabilities | £ 25,646 | £ 24,984 |
Securitisations and covered bonds | Internally retained | ||
Disclosure Of Assets Pledged As Security [Line Items] | ||
Notes issued under securitisation and covered bond programmes retained internally | 2,875 | 1,725 |
Securitisations and covered bonds | Third party bilateral secured funding transactions | ||
Disclosure Of Assets Pledged As Security [Line Items] | ||
Notes issued to Santander UK plc/subsidiaries as collateral | 1,500 | 500 |
Santander UK plc | Securitisations and covered bonds | Internally retained | ||
Disclosure Of Assets Pledged As Security [Line Items] | ||
Internally retained securitisation and covered bond issuances available for creating collateral | £ 775 | £ 829 |
Financial Instruments - Additional Information (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Disclosure Of Fair Value Measurement Of Assets And Liabilities [Abstract] | ||
Transfers out of Level 1 into Level 2 of fair value hierarchy, assets held at end of reporting period | £ 0 | £ 0 |
Transfers out of Level 2 into Level 1 of fair value hierarchy, assets held at end of reporting period | 0 | 0 |
Transfers into Level 3 of fair value hierarchy, assets | 0 | 0 |
Transfers out of Level 3 of fair value hierarchy, assets | 0 | 0 |
Transfers out of Level 1 into Level 2 of fair value hierarchy, liabilities held at end of reporting period | 0 | 0 |
Transfers out of Level 2 into Level 1 of fair value hierarchy, liabilities held at end of reporting period | 0 | 0 |
Transfers into Level 3 of fair value hierarchy, liabilities | 0 | 0 |
Transfers out | £ 0 | £ 0 |
Financial Instruments - Summary of Fair Value Adjustment (Details) - GBP (£) £ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Disclosure of financial assets [line items] | ||
Fair value adjustments | £ 9 | £ 14 |
Risk-related: | ||
Disclosure of financial assets [line items] | ||
Fair value adjustments | 10 | 15 |
Day One profit | ||
Disclosure of financial assets [line items] | ||
Fair value adjustments | (1) | (1) |
- Bid-offer and trade specific adjustments | Risk-related: | ||
Disclosure of financial assets [line items] | ||
Fair value adjustments | (8) | (12) |
- Uncertainty | Risk-related: | ||
Disclosure of financial assets [line items] | ||
Fair value adjustments | 21 | 27 |
- Credit risk adjustment | Risk-related: | ||
Disclosure of financial assets [line items] | ||
Fair value adjustments | (3) | (1) |
- Funding fair value adjustment | Risk-related: | ||
Disclosure of financial assets [line items] | ||
Fair value adjustments | £ 0 | £ 1 |
Assets Held for Sale (Details) - GBP (£) £ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Disclosure Of Assets And Liabilities Classified As Held For Sale [Line Items] | ||
Assets held for sale | £ 49 | £ 49 |
Property, plant and equipment | ||
Disclosure Of Assets And Liabilities Classified As Held For Sale [Line Items] | ||
Assets held for sale | £ 49 | £ 49 |
Events After the Balance Sheet Date (Details) |
6 Months Ended |
---|---|
Jun. 30, 2023 | |
Disclosure of non-adjusting events after reporting period [abstract] | |
Description of nature of non-adjusting event after reporting period | There have been no significant events between 30 June 2023 and the date of approval of these financial statements which would require a change to or additional disclosure in the financial statements. |
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