EGG PLC
UK GAAP TO IFRS RECONCILIATIONS - INCOME STATEMENT
2A. Reconciliation of the Income Statement
For the three months ended 31 March 2004
UK GAAP on Reclassifications IFRS 2 IFRS 3 IAS 12 Total Effect Restated
an IFRS Share- Business Income of transition under
format based Combinations Taxes to IFRS IFRS
Payments (unaudited)
£m £m £m £m £m £m £m
Continuing operations:
Interest income 211.8 - - - - - 211.8
Interest expense (137.8) - - - - - (137.8)
Net interest income 74.0 - - - - - 74.0
Fee and commission income 52.1 - - - - - 52.1
Fee and commission expense (9.9) - - - - - (9.9)
Net fee and commission income 42.2 - - - - - 42.2
Other operating income 2.5 - - - - - 2.5
Operating income 118.7 - - - - 118.7
Administrative expenses
- personnel expenses - (23.1) 0.7 - - (22.4) (22.4)
- depreciation and
amortisation (5.9) - - - - - (5.9)
- other administrative
expenses (58.8) 23.1 - - - 23.1 (35.7)
(64.7) - 0.7 - - 0.7 (64.0)
Impairment losses on loans and
advances to customers (41.0) - - - - - (41.0)
Operating profit 13.0 - 0.7 - - 0.7 13.7
Share of operating profit of
joint ventures 0.3 - - - - - 0.3
Share of associate losses (0.4) - - 0.3 - 0.3 (0.1)
Profit on continuing ordinary 12.9 - 0.7 0.3 - 1.0 13.9
activities before tax
2A. Reconciliation of the Income Statement
For the three months ended 31 March 2004 (continued)
UK GAAP on Reclassifications IFRS 2 IFRS 3 IAS 12 Total Effect Restated
an IFRS Share- Business Income of transition under
format based Combinations Taxes to IFRS IFRS
Payments (unaudited)
£m £m £m £m £m £m £m
Tax charge on profit on
continuing ordinary
activities (5.8) - - - 0.1 0.1 (5.7)
Profit on continuing
ordinary activities after
tax 7.1 - 0.7 0.3 0.1 1.1 8.2
Discontinued operations:
Loss on discontinued ordinary (12.9) - - - - - (12.9)
activities after tax
Retained loss for the period (5.8) - 0.7 0.3 0.1 1.1 (4.7)
2B. Reconciliation of the Income Statement
For the year ended 31 December 2004
UK GAAP Reclass- IFRS 2 IFRS 3 IAS 12 IAS 21 Total Restated
on an ifications Share- Business Income The Effects Effect under
IFRS based Combin- Taxes of Changes of IFRS
format Payments ations in Foreign Trans- (unaudited)
Exchange ition
Rates to IFRS
£m £m £m £m £m £m £m £m
Continuing operations:
Interest income 902.8 - - - - - - 902.8
Interest expense (615.4) - - - - - - (615.4)
Net interest income 287.4 - - - - - - 287.4
Fee and commission 220.7 - - - - - - 220.7
income
Fee and commission (25.2) - - - - - - (25.2)
expense
Net fee and commission 195.5 - - - - - - 195.5
income
Other operating income 14.7 - - - - - - 14.7
Operating income 497.6 - - - - - 497.6
Administrative expenses
- personnel expenses - (89.4) (3.3) - - - (92.7) (92.7)
- depreciation and (22.2) - - - - - (22.2)
amortisation
- other (228.7) 89.4 - - - - 89.4 (139.3)
administrative expenses
(250.9) - (3.3) - - - (3.3) (254.2)
Impairment losses on
loans and advances to
customers (182.4) - - - - - - (182.4)
Operating profit 64.3 - (3.3) - - - (3.3) 61.0
2B. Reconciliation of the Income Statement
For the year ended 31 December 2004 (continued)
UK GAAP Reclass- IFRS 2 IFRS 3 IAS 12 IAS 21 Total Restated
on an ifications Share- Business Income The Effects Effect under
IFRS based Combin- Taxes of Changes of IFRS
format Payments ations in Foreign Trans- (unaudited)
Exchange ition
Rates to IFRS
£m £m £m £m £m £m £m £m
Share of operating
profit of joint
ventures 0.3 - - - - - - 0.3
Share of associate (1.6) - - 1.2 - - 1.2 (0.4)
losses
Profit on continuing
ordinary activities
before tax 63.0 - (3.3) 1.2 - - (2.1) 60.9
Tax charge on profit on
continuing ordinary
activities (24.8) - - - 0.1 - 0.1 (24.7)
Profit on continuing
ordinary activities
after tax 38.2 - (3.3) 1.2 0.1 - (2.0) 36.2
Discontinued operations:
Loss on discontinued
ordinary activities
after tax (131.0) - - 0.5 - (6.7) (6.2) (137.2)
Retained loss for the (92.8) - (3.3) 1.7 0.1 (6.7) (8.2) (101.0)
year
3. UK GAAP TO IFRS RECONCILIATIONS - SHAREHOLDERS' EQUITY
As at 1 January 2004
£m
Shareholders' equity at 1 January 2004:
UK GAAP 433.6
Adjustment for deferred tax on share schemes 0.5
IFRS 434.1
Notes:
On transition to IFRS, it was also necessary to recognise a share-based payment
charge under IFRS 2 and reverse the UK GAAP charge. These adjustments had no
net impact on shareholders' equity as both sides of these two adjustments were
to equity.
4. UK GAAP TO IFRS RECONCILIATIONS - BALANCE SHEET
4A. Reconciliation of the Balance Sheet
As at 31 March 2004
UK GAAP on an IFRS adjustments Restated
IFRS format under IFRS
(unaudited)
£m £m £m
Assets
Cash and balances with central banks 13.2 - 13.2
Loans and advances to banks 268.6 - 268.6
Investment securities 3,557.6 - 3,557.6
Derivative financial instruments 10.3 - 10.3
Loans and advances to customers 6,864.0 - 6,864.0
Prepayments and accrued income 64.0 - 64.0
Investments in joint venture and associates 6.2 0.3 6.5
Property, plant and equipment 95.1 (39.0) 56.1
Intangible assets 5.9 39.0 44.9
Deferred tax 23.3 0.6 23.9
Other assets 326.4 - 326.4
Total assets 11,234.6 0.9 11,235.5
Liabilities
Deposits by banks 1,613.5 - 1,613.5
Securities sold under agreements to repurchase 239.2 - 239.2
Customer accounts 6,408.8 - 6,408.8
Investment securities in issue 1,581.6 - 1,581.6
Derivative financial instruments 11.2 - 11.2
Other liabilities 347.6 - 347.6
Accruals and deferred income 147.5 - 147.5
Subordinated liabilities
- Dated loan capital 450.8 - 450.8
Total liabilities 10,800.2 - 10,800.2
Shareholders' equity
Called up share capital 411.8 - 411.8
Share premium account 110.4 - 110.4
Capital reserve 359.7 - 359.7
Other reserves - 0.2 0.2
Accumulated losses (448.6) 0.7 (447.9)
Total equity attributable to the equity holders
of the parent 433.3 0.9 434.2
Minority interests (equity) 1.1 - 1.1
Total equity 434.4 0.9 435.3
Total equity and liabilities 11,234.6 0.9 11,235.5
4B. Reconciliation of the Balance Sheet
As at 31 December 2004
UK GAAP on an IFRS adjustments Restated
under IFRS
IFRS format (unaudited)
£m £m £m
Assets
Cash and balances with central banks 14.0 - 14.0
Loans and advances to banks 615.9 - 615.9
Securities purchased under agreement to resell 319.4 - 319.4
Investment securities 3,119.7 - 3,119.7
Derivative financial instruments 16.0 - 16.0
Loans and advances to customers 7,642.0 - 7,642.0
Prepayments and accrued income 58.3 - 58.3
Investments in joint venture and associates 5.0 1.3 6.3
Property, plant and equipment 96.5 (48.5) 48.0
Intangible assets - 49.0 49.0
Deferred tax 28.2 0.7 28.9
Other assets 130.6 - 130.6
Total assets 12,045.6 2.5 12,048.1
Liabilities
Deposits by banks 2,352.0 - 2,352.0
Securities sold under agreements to repurchase 130.5 - 130.5
Customer accounts 6,607.4 - 6,607.4
Investment securities in issue 1,806.5 - 1,806.5
Derivative financial instruments 17.5 - 17.5
Other liabilities 110.5 - 110.5
Accruals and deferred income 215.0 - 215.0
Provisions for liabilities and charges 16.8 - 16.8
Subordinated liabilities
- Dated loan capital 450.8 - 450.8
Total liabilities 11,707.0 - 11,707.0
Shareholders' equity
Called up share capital 412.2 - 412.2
Share premium account 111.0 - 111.0
Capital reserve 359.7 - 359.7
Other reserves - (0.5) (0.5)
Accumulated losses (544.2) 3.0 (541.2)
Total equity attributable to the equity holders of
the parent 338.7 2.5 341.2
Minority interests (equity) (0.1) - (0.1)
Total equity 338.6 2.5 341.1
Total equity and liabilities 12,045.6 2.5 12,048.1
5. UK GAAP TO IFRS RECONCILIATIONS - CASH FLOW STATEMENT
The most significant adjustment to the cash flow statement under IFRS is an
adjustment to reclassify certain amounts from loans and advances to cash and
cash equivalents. Presentation of a cash flow statement on an IFRS basis does
not affect the underlying cash flows of the business.
5A. Reconciliation of the Cash Flow Statement
For the 3 months ended 31 March 2004
UK GAAP on an IFRS Restated under
IFRS format adjustments IFRS
(unaudited)
£m £m £m
Cash flows from operating activities
Continuing operations:
Operating profit before taxation 13.0 0.7 13.7
Adjusted for:
Depreciation, impairment and amortisation 9.2 (0.7) 8.5
Impairment losses on loans and advances to 16.6 - 16.6
customers
Gain on sale of investment securities (1.5) - (1.5)
Net (increase)/decrease in operating assets:
Loans and advances to banks 80.8 (128.5) (47.7)
Loans and advances to customers (110.2) - (110.2)
Securities purchased under agreement to resell - - -
Accrued income and prepayments 10.8 - 10.8
Other assets (35.6) - (35.6)
Net increase/(decrease) in operating
liabilities: (45.7) - (45.7)
Deposits by banks
Securities sold under agreements to repurchase (590.0) - (590.0)
Customer accounts (34.5) - (34.5)
Investment securities in issue 158.7 - 158.7
Accruals and deferred income (5.3) - (5.3)
Other liabilities 28.9 - 28.9
Taxation paid (1.8) - (1.8)
Net cash outflow from continuing operating
activities (506.6) (128.5) (635.1)
Discontinued operations:
Net cash (outflow)/inflow from discontinued
operating activities (7.6) 19.7 12.1
Total net cash outflow from operating (514.2) (108.8) (623.0)
activities
5A. Reconciliation of the Cash Flow Statement
For the 3 months ended 31 March 2004 (continued)
UK GAAP on an IFRS Restated under
IFRS format adjustments IFRS
(unaudited)
£m £m £m
Cash flows from investing activities
Continuing operations:
Purchase of property, plant and equipment (6.2) - (6.2)
Disposal of property, plant and equipment (1.2) - (1.2)
Purchase of software intangibles (0.6) - (0.6)
Purchase of investment securities (1,377.6) - (1,377.6)
Disposal of investment securities 1,941.1 - 1,941.1
Net cash inflow from continuing investing
activities 555.5 - 555.5
Discontinued operations:
Net cash inflow from discontinued investing
activities 1.1 - 1.1
Total net cash inflow from investing
activities 556.6 - 556.6
Cash flows from financing activities
Continuing operations:
Proceeds from issue of share capital 4.4 - 4.4
Total net cash inflow from financing
activities 4.4 - 4.4
Increase/(decrease) in cash and cash 46.8 (108.8) (62.0)
equivalents in the period
Cash and cash equivalents at the beginning
of the period 159.9 163.0 322.9
Exchange adjustments 1.8 - 1.8
Cash and cash equivalents at the end of the 208.5 54.2 262.7
period
5B. Reconciliation of the Cash Flow Statement
For the year ended 31 December 2004
UK GAAP on an IFRS Restated under
IFRS format adjustments IFRS
(unaudited)
£m £m £m
Cash flows from operating activities
Continuing operations:
Operating profit before taxation 64.3 (3.3) 61.0
Adjusted for:
Depreciation, impairment and amortisation 25.1 3.3 28.4
Impairment losses on loans and advances to 70.1 - 70.1
customers
Gain on sale of investment securities (7.5) - (7.5)
Net (increase)/decrease in operating assets:
Loans and advances to banks 110.0 (55.2) 54.8
Loans and advances to customers (1,115.6) - (1,115.6)
Securities purchased under agreement to (319.4) - (319.4)
resell
Accrued income and prepayments 16.9 - 16.9
Other assets 99.4 - 99.4
Net increase/(decrease) in operating 772.3 - 772.3
liabilities:
Deposits by banks
Securities sold under agreements to (698.7) - (698.7)
repurchase
Customer accounts (53.0) - (53.0)
Investment securities in issue 383.6 - 383.6
Accruals and deferred income 29.6 - 29.6
Other liabilities (133.6) - (133.6)
Group relief 14.1 - 14.1
Net cash outflow from continuing operating
activities (742.4) (55.2) (797.6)
Discontinued operations:
Net cash (outflow)/inflow from discontinued
operating activities (85.4) 161.6 76.2
Total net cash (outflow)/inflow from
operating activities (827.8) 106.4 (721.4)
5B. Reconciliation of the Cash Flow Statement
For the year ended 31 December 2004 (continued)
UK GAAP on an IFRS Restated under
IFRS format adjustments IFRS
(unaudited)
£m £m £m
Cash flows from investing activities
Continuing operations:
Purchase of property, plant and equipment (13.1) - (13.1)
Purchase of software intangibles (37.7) - (37.7)
Purchase of investment securities (6,447.5) - (6,447.5)
Disposal of investment securities 7,435.3 - 7,435.3
Net cash inflow from continuing investing
activities 937.0 - 937.0
Discontinued operations:
Net cash inflow from discontinued investing
activities 90.6 - 90.6
Total net cash inflow from investing
activities 1,027.6 - 1,027.6
Cash flows from financing activities
Continuing operations:
Proceeds from issue of share capital 5.4 - 5.4
Total net cash inflow from financing
activities 5.4 - 5.4
Increase in cash and cash equivalents in the
year 205.2 106.4 311.6
Cash and cash equivalents at the beginning
of the year 159.9 163.0 322.9
Exchange adjustments (6.8) - (6.8)
Cash and cash equivalents at the end of the
year 358.3 269.4 627.7
1. RECONCILIATION OF BALANCE SHEET UPON ADOPTION OF IAS 32 AND IAS 39
As at 1 January 2005
IAS 32 covers the disclosure and presentation of financial instruments whereas
IAS 39 covers their recognition and measurement. IAS 39 requires that all
financial assets and financial liabilities, including derivatives, be recognised
on balance sheet, with the instruments being accounted for at either fair value
or amortised cost, depending on the classification of the instrument.
The Group has adopted the exemption provided in IFRS 1 to not present
comparative information in accordance with IAS 32 and IAS 39. Comparative
information for financial instruments in 2004 will therefore be prepared on the
basis of the UK GAAP accounting policies as disclosed in the last annual report
with IAS 32 and IAS 39 being applied from 1 January 2005. Adjustments to
reflect the adoption of IAS 32 and IAS 39 at 1 January 2005 have been recognised
through equity and are reflected in the reconciliations contained in this
appendix. The following is an explanation of the key impacts of adoption of IAS
32 and IAS 39 as at 1 January 2005.
(a) Reclassifications
In accordance with IAS 32 and IAS 39, certain reclassifications have been made
to reflect the appropriate categorisations required by these standards. These
have included adjustments to transfer:
• accrued interest on loans and receivables previously recognised within
prepayments and accrued income under UK GAAP, to the amortised cost carrying
amount within loans and advances;
• within Other assets on the balance sheet was certain accrued interest
amounts on derivatives previously off balance sheet. These amounts have
been reclassified to the derivative financial instruments category on the
balance sheet; and
• other reclassifications for investment securities and other wholesale
assets.
(b) Effective interest rate
Credit card receivables
Under UK GAAP, the carrying amount of credit card receivables with low or zero
rate interest on balance transfers or purchases are carried at cost, with
interest being accrued at 0% during the incentive period and then at the
standard rate thereafter.
Under IAS 39, credit card receivables are categorised as non-derivative
financial assets with fixed or determinable payments that are not quoted in an
active market. These receivables are measured on an amortised cost basis,
whereby the principal balance includes the accrued interest and unamortised fees
and discounts and interest income is recognised on an effective yield basis
inclusive of all integral fees and discounts.
In calculating the effective interest on the credit card receivables, the Group
has recognised as an upfront loss in the income statement the cost of the
discount given to customers as compared to the market rate. Thereafter,
interest income will then be recognised at the market rate from day one on the
incentive balances until they are paid off and interest income will be
recognised on non-incentive balances at the standard rate on the credit cards as
the interest is earned. Where credit cards fees are deemed integral to the
product they will be included in the effective interest calculation and spread
over the life of the product.
The impact upon transition to IFRS is to create a liability for the un-amortised
discount on the balance sheet based on year end 2004 incentive balances which is
credited to the income statement during 2005. The overall net impact on 2005
profit before tax is not expected to be material.
Other products
Egg offers promotional rates on customer deposits through the bonus account and
on mortgages through the discount product. Under IFRS all interest, integral
fees and costs will now be recognised on a level yield basis to the expected
maturity date.
(c) Impairment losses on loans and advances to customers
Under UK GAAP specific and formulated provisions are raised against
non-performing loans and a general provision against the balance.
Under IAS 39, an impairment loss on loans and advances to customers is only
recognised where there is objective evidence that a debt is impaired. The
recoverable amount of an impaired asset is the present value of expected future
cash flows discounted at the original effective interest rate, and the
difference between this and the asset balance is the impaired amount. Interest
income is recognised only on the loans and receivables balances net of
impairment.
There is little impact in the overall level of impairment losses to be
recognised under IAS 39 due to the similarities to the Group's former
provisioning methodology under UK GAAP. On transition to IFRS, there was a
small release of the UK GAAP bad debts provision, and prospectively, the Group
expects a similar charge to the income statement for impairment losses on loans
and advances to customers under IFRS as for the bad and doubtful debts charge
that would have occurred under UK GAAP.
(d) Wholesale financial instruments
Under UK GAAP all wholesale instruments were previously accounted for on an
accruals cost basis. Under IAS 39, certain wholesale financial instruments are
required to be measured at fair value, and depending on whether they have been
classified as fair value through profit or loss or as available-for-sale, the
changes in fair value are recognised in the income statement or in equity
respectively. The measurement techniques for fair valuing financial instruments
have been described in the significant accounting policies in note 1.
On transition to IFRS, the impact of valuing derivative financial instruments at
fair value through profit or loss resulted in a reduction in equity of £7.1
million. For those instruments classified as available-for-sale, this resulted
in a reduction in other reserves of £1.6 million.
The adjustments for wholesale financial instruments at fair value also include
the impact of designating some of the Group's derivatives as cash flow hedges.
Previously accounted for on an off balance sheet basis, on transition the cash
flow hedges resulted in a fair value gain of £0.3 million, all of which was
deemed to be an effective hedge and recognised in other reserves.
(e) Equity saving products
At the date of transition to IFRS, the Group was party to certain equity savings
products which contained embedded derivatives. The host contracts have been
accounted for at amortised cost and resulted in a reduction in liabilities and a
net gain to equity reserves of £7.4 million. The embedded derivates were
accounted for at fair value in accordance with IAS 39. The impact of this was
to bring onto the balance sheet at fair value a purchased option (gain of £12.5
million), a written option (loss of £12.4 million) and a Libor swap (loss of
£9.3 million), giving a net loss at transition to equity reserves of £9.2
million.
(f) Derecognition of financial liabilities
The Group's policy is to derecognise financial liabilities only when the
obligation specified in the contract is discharged, cancelled or has expired.
Accordingly, on transition the Group has written back certain financial
liabilities previously written off.
(g) IAS 12 Income Taxes
The IAS 39 adjustments are temporary differences, and accordingly a deferred tax
asset has been recognised on the total of these adjustments at 30% as it is
expected that they will be taxable or relievable at a future point in time. The
Group has also assessed the recoverability of the deferred tax asset and has
determined that the asset will be fully recoverable.
2. RECONCILIATION OF THE BALANCE SHEET UPON ADOPTION OF IAS 32 AND IAS 39 - As
at 1 January 2005
IAS 32 and 39 adjustments
1 January Reclass- Effective Impairment Wholesale Equity Derecog IAS 12 Total Restated
ifications nition
2005 interest financial savings of Income Adjustments (unaudited)
(excluding rate instruments products liabi- Taxes
IAS 39) lities
(a) (b) (c) (d) (e) (f) (g)
£m £m £m £m £m £m £m £m £m £m
Assets
Cash and balances
with central
banks 14.0 - - - - - - - - 14.0
Loans and 615.9 0.3 - - - - - - 0.3 616.2
advances to banks
Securities
purchased under
agreement to
resell 319.4 0.7 - - - - - - 0.7 320.1
Investment 3,119.7 19.7 - - (2.5) - - - 17.2 3,136.9
securities
Derivative 16.0 - - - 4.3 12.5 - - 16.8 32.8
financial
instruments
Loans and
advances to
customers 7,642.0 29.0 (7.5) 3.3 - - - - 24.8 7,666.8
Prepayments and
accrued income 58.3 (49.7) - - - - - - (49.7) 8.6
Investments in
joint venture and
associate 6.3 - - - - - - - - 6.3
Property, plant 48.0 - - - - - - - - 48.0
and equipment
Intangible assets 49.0 - - - - - - - - 49.0
Deferred tax 28.9 - - - - - - 6.5 6.5 35.4
Other assets 130.6 - - - (2.2) - - - (2.2) 128.4
Total assets 12,048.1 - (7.5) 3.3 (0.4) 12.5 - 6.5 14.4 12,062.5
2. RECONCILIATION OF THE BALANCE SHEET UPON ADOPTION OF IAS 32 AND IAS 39 - As
at 1 January 2005 (continued)
IAS 32 and 39 adjustments
1 January Reclass- Effective Impairment Wholesale Equity Derecog IAS 12 Total Restated
ifications nition
2005 interest financial savings of Income Adjustments (unaudited)
(excluding rate instruments products liabi- Taxes
IAS 39) lities
(a) (b) (c) (d) (e) (f) (g)
£m £m £m £m £m £m £m £m £m £m
Liabilities
Deposits by banks 2,352.0 13.5 - - 0.1 - - - 13.6 2,365.6
Securities sold
under agreements
to repurchase 130.5 0.5 - - - - - - 0.5 131.0
Customer accounts 6,607.4 83.9 (2.2) - - (7.4) 9.6 - 83.9 6,691.3
Investment 1,806.5 8.6 - - - - - - 8.6 1,815.1
securities in
issue
Derivative 17.5 0.4 - - 10.5 21.7 - - 32.6 50.1
financial
instruments
Other liabilities 110.5 (0.3) - - (2.4) - - - (2.7) 107.8
Accruals and 215.0 (107.9) - - - - - - (107.9) 107.1
deferred income
Provisions for 16.8 - - - - - - - - 16.8
liabilities and
charges
Subordinated
liabilities
- Dated loan 450.8 1.3 - - (0.2) - - - 1.1 451.9
capital
Total liabilities 11,707.0 - (2.2) - 8.0 14.3 9.6 - 29.7 11,736.7
Shareholders'
equity
Called up share 412.2 - - - - - - - - 412.2
capital
Share premium 111.0 - - - D - - - - - 111.0
account
Capital reserve 359.7 - - - - - - - - 359.7
Other Reserves (0.5) - - - (1.3) - - 0.4 (0.9) (1.4)
Accumulated (541.2) - (5.3) 3.3 (7.1) (1.8) (9.6) 6.1 (14.4) (555.6)
losses
Total equity
attributable to
the equity 341.2 - (5.3) 3.3 (8.4) (1.8) (9.6) 6.5 (15.3) 325.9
holders of the
parent
Minority (0.1) - - - - - - - - (0.1)
interests
(equity)
Total equity 341.1 - (5.3) 3.3 (8.4) (1.8) (9.6) 6.5 (15.3) 325.8
Total equity and 12,048.1 - (7.5) 3.3 (0.4) 12.5 - 6.5 14.4 12,062.5
liabilities
Average Balance Sheet (UK Business Only)
(£m, except percentages)
31 March 31 March 31 December
2005 2004 2004
Avg. Avg. Avg. Avg. Avg. Avg.
Balance Rate % Balance Rate % Balance Rate %
Assets
Wholesale assets 4,161 4.62 4,354 4.13 4,212 4.51
Mortgages 1,770 5.27 2,111 4.70 1,835 5.09
Personal loans 2,416 7.16 1,547 7.73 2,228 7.25
Credit cards 3,354 9.56 2,808 9.55 3,175 9.61
Total average interest-earning 11,450 6.55
assets 11,701 6.66 10,820 6.18
Fixed and other assets 289 337 339
Total assets 11,990 11,157 11,789
Liabilities
Customer accounts 6,366 4.16 6,754 3.28 6,280 3.90
Wholesale liabilities and 4,540 4.67
subordinated debt 4,661 4.66 3,471 4.13
Total average interest-bearing 10,820 4.22
liabilities 11,027 4.37 10,225 3.57
Other liabilities 444 440 450
Total liabilities 11,471 10,665 11,270
Total equity 519 492 519
Total equity and liabilities 11,990 11,157 11,789
Note: The above analysis represents interest earned or borne on on-balance sheet
assets and liabilities only. In each case the average balances and yields have
been calculated on a 12-month rolling basis.
The figures for Q1 2005 are compiled on full IFRS basis including the effect of
IAS 32 and IAS39 and as such are no longer strictly comparable to the prior
period and prior year figures.
Average Yields (UK Business Only)
31 March 31 March 31 December
2005 2004 2004
Average rate % Average rate % Average rate %
Interest income as a percentage of average 6.66 6.18 6.55
interest-earning assets
Interest expense as a percentage of average 4.37 3.57 4.22
interest-bearing liabilities
Interest spread 2.29 2.61 2.33
Net interest margin (includes interest on off-balance 2.43 2.54 2.51
sheet items)
Note:
This press release contains certain forward-looking statements with respect to
the financial condition, results of operations, and businesses of the Egg Group.
These statements and forecasts involve risk and uncertainty because they
relate to events that depend upon circumstances that will occur in the future.
There are a number of factors that could cause actual results or developments to
differ materially from those expressed or implied by these forward-looking
statements and forecasts. The statements have been made with reference to
forecast price changes, economic conditions and the current regulatory
environment. Nothing in this press release should be construed as a profit
forecast.
Ends
For further information:
Media:
Egg Press Office (main number): 020 7526 2600
Emma Byrne: 020 7526 2565 / mobile: 07775 657 241
Analysts / Investors:
Kieran Coleman: 020 7526 2648 / mobile: 07711 717 358