Annual Report
and Accounts 2008

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• Presentation of information
• Forward-looking statements
• Description of business
• Competition
• Risk factors
• Key financials
• Overview of results
• Summary consolidated income statement
• Analysis of results
• Divisional performance
  • Global Markets
  • Regional Markets
  • RBS Insurance
  • Group Manufacturing
  • Central items
  • Employee numbers at 31 December
• Consolidated balance sheet
• Cash flow
• Capital resources
• Reconciliations of pro forma to statutory income statements and balance sheets
• Risk, capital and liquidity management

Divisional performance

The results of each division on both the statutory and pro forma basis are set out below. The pro forma divisional results are stated before credit market write-downs and one-off items, amortisation of purchased intangible assets, write-down of goodwill and other intangible assets, integration costs, restructuring costs, share of shared assets and after allocation of manufacturing costs where appropriate ('Group operating profit'). The Group manages costs where they arise. Customer-facing divisions control their direct expenses whilst Manufacturing is responsible for shared costs. In 2008, the Group did not allocate these shared costs between divisions in the day-to-day management of its businesses, and the way in which divisional results are presented reflects this. However, in order to provide a basis for market comparison, the pro forma results below also include an allocation of Manufacturing costs to the customer-facing divisions on a basis management considers to be reasonable.

The performance of each of the divisions is reviewed in the subsections to this section.

Pro forma Group operating (loss)/profit is before purchased intangibles amortisation, write-down of goodwill and other intangible assets, integration costs, restructuring costs and RBS share of consortium shared assets.

Risk-weighted assets of each division were as follows: