NatWest Group PLC

Welcome, everyone. We will now play a pre-recorded audio presentation of our H1 results. This will be followed by a live Q&A session with Howard Davis, Alison Rose and Katie Murray.

Good morning, everyone. Thank you for joining us today for our first half results presentation. Our agenda for the call is follows. I will start with the first half headlines and update you on how we have been managing the business through the COVID-19 pandemic. The progress we have made on our strategic priorities during the first half, and then Katie will take you through the numbers in more detail before I wrap up and we open it up for questions. So let me start with the headlines. As you know, we had a strong start to the year before the impact of COVID-19, and our pre-impairment operating profit for the first half was £2.1 billion. Since we spoke in May, however, the economic outlook has worsened. and as a result, we are announcing a first-half net impairment charge of £2.9 billion. This is based on extensive modelling carried out during the second quarter, which I'll talk about on the next slide. Costs were slightly lower year on year, and taking into account impairments, we made an operating loss of £770 million and an attributable loss of £705 million. Given the ongoing economic uncertainty, We are pleased to be operating from a position of strength in terms of liquidity, funding and capital, even after absorbing prudent provisions for impairments. This is a sign of the strength of our franchise. Our common equity tier one ratio for the first half was 17.2% and our liquidity coverage ratio was 166%. I'll talk about impairment and capital on slide five. Given the current level of economic uncertainty, we are managing impairments carefully. Our impairment charge for the second quarter was £2.1 billion, an increase from £802 million in the first quarter. This charge is based on modelling that takes into account a wide range of macroeconomic factors, as well as expert views on risk, and reflects a deterioration in economic indicators. We have provided you with a lot of detailed information on our approach, which Katie will take you through later. As a result of this modelling, the majority of provisions have been taken in the first half, providing coverage of 1.72%. We anticipate a significantly lower charge in the second half, with full-year charge in the range of £3.5 to £4.5 billion, based on current economic assumptions. Despite this increase in provisions, We have a CET1 ratio of 17.2%, one of the strongest capital ratios in Europe. Now, of course, this ratio partly reflects the cancellation of dividends earlier in the year in consultation with the regulator. And we plan to return to paying dividends as soon as it is possible. We continue to believe with the current shape and mix of our business that we should be operating with a CET1 ratio of 13% to 14% over the medium to long term, which means we have clear headroom of somewhere between £6 billion to £8 billion above our target capital ratio and £15 billion above the maximum distributable amount. This gives us the flexibility to return capital to shareholders as soon as that is possible, to manage an uncertain outlook and to consider other options that offer compelling shareholder value. So having given you the headlines, let me move on to talk about how we have been running the business during the pandemic. We set out a new purpose in February to champion potential by helping people, families and businesses to thrive. What you will hear today is how we are taking advantage of our strong customer franchise and market positions to advance that purpose. We have supported our customers in difficult circumstances. and we have done so safely, with a prudent approach to risk and impairments and with careful deployment of our balance sheet. We have taken swift action to address Covid-19, but we have also focused on the key strategic priorities I set out in February. For example, we have made real progress refocusing NatWest Markets onto the needs of our core customers, and expect to complete the majority of our targeted RWA reduction by the end of 2021. We are also on track to deliver our £250 million cost reduction target, despite the disruption of Covid-19. Finally, we remain focused on maintaining a strong balance sheet, which, as I said, gives us significant advantage in this environment and will allow us to resume dividend payments to shareholders when it is appropriate to do so. Putting purpose into action has entailed making a very significant change to the way we work in order to support our customers during the pandemic, as you will see on slide seven. We have kept 95% of our branch network open for customers who need help. And we have over 50,000 people working from home, including more than three quarters of our call center colleagues. The swift action we have taken to help customers has contributed to increased net promoter schools, which are up 18 points in our branches and 20 points in business banking since March. We are proud of the strength of our customer franchise, and our response during this period of disruption is an important part of deepening relationships with customers and positioning us well for growth as the economy recovers. We have leveraged our investment in technology not just to support working from home, but also to accelerate new digital services in order to meet customer needs. Our customers are increasingly engaging with us via digital channels. We now have 7.2 million active mobile users, whilst three quarters of our current account customers in personal banking and almost all commercial banking customers regularly use digital banking. Sales via digital channels have also grown rapidly, 80% of personal banking sales were digital in the second quarter compared to 55% in the first. In addition, there were over half a million new downloads of our app during the first half, and we added more than 485,000 new online banking customers. A good example of our focus on innovation and partnership is our re-entry into merchant acquiring via our new digital payment solution for small businesses called TIL. TIL has become even more important for these customers, with a move to contactless payments during the pandemic, and it's progressing well. It has now processed over 4.5 million transactions, up from 1 million in February. These examples are an illustration of how our investment is enabling us to scale up and increase speed of delivery, both effectively and efficiently. I'll talk on slide eight about how we have also been supporting customers through lending. Across the retail and commercial businesses, net lending increased by 16 billion in total during the first half, approximately half of which relates to government scheme drawdowns. You can see here the impact of the pandemic on customer behaviour in the second quarter. In personal banking, there was a fall off in demand in April, but we are now seeing signs of recovery as lockdown eases. New mortgage applications in July are nearing pre-Covid-19 levels and are 30 per cent higher than June, spurred on partly by a reduction in stamp duty. Debit and credit card spending is also growing and is 10 per cent higher than the levels we saw in June, with debit card spending back to the same level as January. Of course, it is still early days, and we are watching this closely given the uncertain outlook. In commercial banking, there was a steep increase in the use of revolving credit facilities in March, but customers are now making significant repayments as Government lending schemes have kicked in. The current RCF usage is about 30%, down from the Covid-19 peak of 40%. weekly commercial card and cash transactions have more than doubled by volume from a low point in April. And we have also seen record issuance in debt capital markets. Turning now to government support scheme lending on slide nine. As you would expect, we have done all we can to support our customers during this period of uncertainty, including providing them with access to all the government support schemes. but we have only supported existing customers, customers we know and whose risk profile we understand. We have also maintained a consistent approach to risk, due diligence and underwriting standards, with the exceptions of bounce-back loans, which are 100% guaranteed by the Government. In order to help people and families in the UK, we have extended £240,000 initial mortgage repayment holidays, which represents 20% of our book, and 72,000 payment holidays on personal loans. With an easing of lockdown, our focus has shifted to helping customers as they start to resume normal repayments. What is clear is that many people who asked for repayment holidays did so through prudence rather than constraint. At this stage, about 70% of UK customers who have come to the end of a repayment holiday have recommenced payments, though this could clearly change when the furlough system starts to roll off and all mortgage holidays run to their full three months. We have also played our full part in government-backed loan schemes for large and small businesses. At the end of June, we had received applications under these schemes amounting to £13 billion, for which we have approved lending of £10 billion to existing customers, which is broadly in line with our market share. Of that £10 billion, £8.3 billion has been drawn down. Demand for these schemes is now tapering off from initial peaks. For example, in July, we have received up to 2,000 applications a day for bounce-back loans and compared to an average of 20,000 a day in the week they were launched and about 48,000 on the first day. We also remain comfortable with the level of risk and diversification of our books, which I will talk about on slide 10. Lending in UK personal banking represents just over half our total loans and advances. Within personal banking, it's important to remember that just 7% of our book is unsecured. And looking at our UK mortgage book, our average loan to value is 57%. Just 12% of the book has an LTV above 80%. I'll talk about commercial lending on slide 11. Wholesale lending is well diversified across large corporates, small and mid-sized businesses, real estate and others. There are, of course, some sectors that we monitor closely, which represent 8% of total loans and advances. We have significantly de-risked our lending in these sectors in recent years by using synthetic trades and capital reduction to manage our exposure. We have also skewed our lending to lower-risk, better-performing subsectors. For example, in retail, The majority of our exposure is to food and convenience retailers who continue to perform well in the current market. In leisure, we have reduced our exposure to high-risk subsectors, and our lending is typically secured against property assets, while oil and gas represents just 1% of our wholesale book. Since the start of Covid-19, we have continued to proactively manage our risk in these sectors, by reducing limits, increasing oversight of new business, and making a series of controlled exits and structured risk mitigation trades. Just 3.6% or a billion pounds of these loans are stage three, and we are comfortable with our coverage ratios. You'll see on slide 12 that our lending growth has been more than outweighed by deposit growth as customers continue to see NatWest Group as a safe place to keep their money. Total customer deposits grew by £39 billion during the first half. Just under a third of that growth was in retail banking, mostly in current accounts as consumers spent less during lockdown. About two thirds was in commercial banking as customers built up liquidity and retained a significant amount of borrowings from government lending schemes. This inflow of deposits has helped to maintain a healthy loan-to-deposit ratio of 86%. Whilst we were quick to respond to the pandemic, we have also continued to focus on executing our four key strategic priorities, and slide 13 is a reminder of them. In addition to these priorities, we set out some ambitious targets for supporting UK enterprise by helping to create new businesses, promoting financial capability and wellbeing, and helping to address climate change. Today, I want to focus on the second and fourth priorities shown here, starting with NatWest Markets on slide 14. Refocusing NatWest Markets is one of my key strategic initiatives, and we have continued to adapt the business to better suit the needs of our corporate and institutional customers. Our aim is to create a business that is both simpler and more strategically aligned with a product suite focused on financing, currencies and risk management. I am pleased with the progress we have made executing our plan. We set a target to reduce risk-rated assets in NatWest markets to £32 billion in 2020 and to almost halve them to £20 billion over time. To date, we have reduced RWA's by £2.8 billion, making good progress towards our 2020 target. and we expect to achieve the majority of our £20 billion target by the end of 2021. We are managing the associated disposal losses to about £600 million over the two years. Since February, we have appointed a new management team at NatWest Markets, confirming Robert Begbie in his post as CEO and bringing in David King as CFO. Direct costs in the second quarter were 13% lower than the first, We are refocusing the business in the US and Asia Pacific by reducing our footprint. And we have started aligning the business to a one bank model by centralizing technology within the group. We have also formed a new partnership with BNP Paribas for both the execution and clearing of listed derivatives. We expect strategic costs to be in the region of 200 million in NatWest markets for 2020. Moving on now to simplification and cost reduction. We have made good progress on simplification in other areas, and we are on track to deliver a cost reduction of £250 million in 2020. As a result of Covid-19, the shape and timing of these cost reductions has been refazed, and we have also incurred additional Covid-19-related costs of £25 million. This has led to a cost reduction of £41 million compared to the first half last year, and we expect to see most of the execution impact falling in the second half. We remain firmly focused on execution, and I have accelerated a planned exit from one of our London properties into 2020. Our strategic costs, however, will still be in the range of £800 million to £1 billion. Before I hand over to Katie, I want to talk on slide 16 about our progress on enterprise, learning and climate change. Our initiatives here are more important than ever as we start to rebuild the economy, which is why we have accelerated our digital offering during the pandemic. On enterprise, we are supporting people who want to become entrepreneurs through our 12 UK accelerator hubs around the country, and we have migrated these hubs to digital delivery. As a result, we welcome 1,200 new entrepreneurs to virtual accelerator programmes in April. and we extended our Dream Bigger programme, which encourages young women aged 16 to 18 to become entrepreneurs by offering it online. On learning, the need for financial education and capability has also become ever more important as people look to manage their own personal balance sheet. We have now completed financial health checks for over half a million customers and we reached 2 million people in the first half through MoneySense, our free financial education programme for five to 18 year olds, which we made available online when schools closed down. We also launched the first ever financial education console game, Island Saver, which has had over a million downloads. We continue to invest in the next generation and we have committed to growing talent by creating a thousand intern, graduate and apprenticeships over the next 15 months. On climate change, we remain focused on making our own operations climate positive over the next five years and halving the climate impact of our financing activity by 2030. During the first half, we issued a $600 million green bond with all proceeds allocated to renewable energy assets across the UK. NatWest Markets was ranked number one book runner for UK corporate green and sustainable bonds by Ideologic, and we helped raise about £4 billion of new sustainable financing and funding. Since 2019, the business has helped 33 clients issue green, social and sustainable bonds, totalling about £29 billion. So in summary, our first half results demonstrate that we have a strong business franchise and have supported our customers well at a time of uncertainty. We are managing risk carefully and providing for impairments thoughtfully. We continue to execute on our strategic priorities, and even after absorbing increased provisions, we have a robust capital position and resilient capital-generative business. This gives us the flexibility to return capital to shareholders as soon as that is possible, to manage an uncertain outlook and to consider other options that offer compelling shareholder value. With that, I'll hand over to Katie to take you through the numbers.

Thank you, Alison, and good morning, everyone. There are three main areas I will spend time on this morning. Naturally, I'll start with the group income statement, and I'll be using the first half last year as a comparator. For the businesses, I'll also show the income progression from the first to second quarter this year. And as Alison mentioned, I'll give you a detailed breakdown of the impairment charge and the scenarios we have used to predict our model expected credit losses under IFRS 9. And finally, I will cover our capital and liquidity position in a little more detail. So starting with the group income statements, we reported total income of £5.8 billion for the first half, a decrease of 5% year on year, excluding the impacts of last year's disposal of Alawal. Within this, net interest income decreased 4% to £3.8 billion. and non-interest income reduced by 6 per cent to just under £2 billion. Those reductions were driven by a fall in rates, the impact of regulatory changes discussed in the past two quarters and the effect of Covid-19 trading. We reduced overall operating costs by 9 per cent to £3.75 billion. Other expenses, including operating lease depreciation, decreased by 1 per cent while strategic costs were 26 per cent lower at £464 million. Litigation and conduct costs for the first half were an £89 million release, reflecting a PPI release of £250 million, offset by some other historical litigation matters. We are reporting operating profit before impairments of £2.1 billion, up 3 per cent from last year, mainly as a result of lower strategic and conduct costs. The impairment charge for the first half was £2.9 billion, which represents 159 basis points of gross customer loans. I will talk about that in more detail later. Taking all of that together, we reported an operating loss before tax of £770 million and an attributable loss of £705 million. On tax, the credit of 27 per cent is higher than the standard rate of 19 per cent due to the rate impact of FX recycling, the tax surcharge and other tax-adjusting items. I'll move on now to take you through the income by business line. Total income for the second quarter was £486 million lower than the first, reflecting the contraction of the yield curve, reduced business activity and lower customer spending resulting from government measures in response to COVID-19. In UK personal banking, total income decreased by £115 million due to lower overdraft fees and significantly reduced car spend, which resulted in reduced fee income and lower unsecured balances. Total commercial banking income was down slightly as a result of lower deposit funding benefits and reduced business activity. This was partially offset by strong balance sheet growth as Government lending initiatives helped to increase net interest income, albeit at a lower margin given the agreed Government rates. Finally, NatWest Markets' income was up £270 million, but excluding own credit adjustments and asset disposals, revenue grew by £50 million. Income from financing increased as the credit market stabilised, with support from central banks, while rates and currencies decreased as market volatility towards the end of the first quarter eased. Moving on now to look at net interest margin. Bank net interest margin decreased 22 basis points in the second quarter to 167 basis points. This is the result of three factors. You will recall we talked about interest rates and margin pressure in May. Lower interest rates accounted for 10 basis points, while five basis points was the result of the impact of a change in mix of lending. I would note, of course, that the level of lending has been beneficial to income, particularly in the commercial area. High level of liquidity we are holding accounted for a further seven basis point reduction as average interest earning assets grew by over £35 billion. This of course had a negative impact on net interest margin, though it had no impact on income or ROE. Looking to the second half, there are two main factors to consider. One, the impact of holding excess liquidity and of course the ongoing pressure from the fall in hedge income. Moving on now to look at costs. Other expenses for the second quarter were £50 million lower than the first, excluding operating lease depreciation. As Alison mentioned, the shape and timing of our cost reduction programme has changed as a result of Covid-19. Fixed costs will be higher as we have delayed some of our restructuring plans. But change then will be lower as we prioritise a smaller number of key programmes to focus on maintaining critical services for customers. Some run-the-bank costs will also be lower, such as travel and the cost of running buildings. Though we have, of course, encountered additional costs in our response to Covid-19, Alison and I both believe it's absolutely critical we remain very disciplined so that we continue making sustainable strategic change where we can. Strategic costs in Q2 were £333 million. This includes £86 million as a result of restructuring NatWest markets. £44 million on technology spend and £148 million related to a London property charges, which includes an additional property exit. This building was already part of our longer-term property rationalisation plan, so it did not make economic sense to make it Covid-19 compliant. This will be beneficial for us in the long run. but it means that strategic costs will now be within our projected range of £800 to £1 billion, rather than at the lower end of that range, as guided in May. Litigation and conduct costs were £85 million released for the second quarter. We have made an additional PPI release of £150 million in the quarter, as we have now substantially completed the complaints process and settlement of claims. Looking forward, as you heard from Alison, we remain committed to our cost reduction target of £250 million for 2020. Moving on now to look at impairments. Over the next couple of slides, I want to give you a more detailed explanation of how we have arrived at the impairment charge, the treatment of Covid-19 support measures under IFRS 9 and our approach to stage migration. I will start with the impairment movement on the balance sheet shown at the top. We reported an impairment charge of £2.9 billion for H1, or 159 basis points of gross customer loans. This charge includes total stage 3 charges of commercial of £236 million, including a small number of single name charges. This compares to ECL increases of £6 to £8 million in mortgages and £0.4 billion in personal unsecured over the same period in H1. The economic outlook has deteriorated during the second quarter, and under current economic assumptions, impairment charge for the full year is likely to be in the range of £3.5 to £4.5 billion. This increase is expected to be made up of migrations to stage 3 as customers move into default and, of course, any further economic movements. The Q1 overlay of £798 million has been absorbed into our provisioning, so we are no longer holding an economic uncertainty overlay in our numbers. Let me take you through our approach on the next slide. In order to arrive at the impairment charge, we have broadly taken a three-step approach. First, we developed four different economic scenarios based on a wide range of future economic indicators and made an assessment of their respective probabilities. After applying probability weightings to these scenarios and given the continued uncertainty, we are using two central scenarios to reflect NatWest Group's expected outlook. They both have a 35% weighting applied, while the upside scenario has a 20% weighting and the downside has 10%. Over the four scenarios, our assumptions for 2020 included a drop in GDP growth ranging from 8.9% to 16.9%, UK unemployment rates between 7.4% and 14.4%, and a fall in house prices of 0.1% to 11.5%. They all assume a return to GDP growth and lower levels of unemployment from 2021 onwards, as you can see from the table on this slide. As a second step, we've made model adjustments to reflect the effect of government support aimed at delaying impairment and reducing the likelihood of default. We also applied expert judgment on specific sectors. The third step was to apply further judgment specifically for high-risk customers and other uncaptured risks. I also want to cover our approach to stage migration. As a starting point, our approach to payment holidays and government lending schemes has continued in the second quarter. New or extended payment holidays will not on their own trigger a stage migration. The key trigger for stage 2 migration in H1 is the deterioration in probability of defaults driven by the adoption of the four new macroeconomic scenarios. In wholesale, we used a conservative threshold for a significant increase in credit risk, or SICR, of just 10 basis points increase in PD. This has led to a large migration of high-quality, up-to-date balances from stage 1 to stage 2. These will have a lower ECL coverage than past-due stage 2 balances. Were our sicker thresholds to be 75 basis points rather than 10 basis points, this would reduce our stage 2 exposure by £16 billion. However, ECL would reduce by just £60 million. For a stage 2 loan to migrate back to stage 1, it must revert back to the PD threshold for a three-month period. Assets only move to stage 3 in the event of default, typically once the account is 90 days past June. On the next slide, I will cover stage migration and expected credit loss coverage in more detail. Before going into the detail, I want to reiterate the fact that the vast majority of the movements I will be discussing in the following two slides are anticipatory and not in response to observed default. Our starting point is that we've continued to use an appropriately conservative approach to stage migration and ECL and personal. Our trigger criteria includes persistence, where we keep balances in stage 3, typically for at least 12 months. For mortgages, 13.5 per cent of mortgage loans now sit in stage 2, which are not past due, against 5.6 per cent in December. The majority of those are up to date as of the balance sheet date. In fact, of our total mortgage book, only 0.9 per cent is past due and 1.6 per cent in stage 3. 30% of total loans and credit cards and personal advances now sit in stage 2, not past June, against 24% at December. And you see a similar pattern repeating in credit cards and personal advances in terms of payments being up to date. Looking at our defaulted balances across personal, we have 1.9% in stage 3 at June against 2.1% in December. However, given our guidance, we expect this to change over Q3 and Q4 as we see defaults start to come through. Turning now to wholesale migration on the next slide. As you would expect, there's clearly been a larger migration here with 38% of total loans at stage two driven by forward-looking PDs. Across wholesale, 36% of loans now sit in stage two, not past due, while 1.7 is stage two past due and 1.9 stage three. overall coverage for wholesale increases from 1.13% to 2.16%, reflecting the mix of PD migration across the Goodbrook and staging, with a slight offset from a small reduction in our stage 3 coverage. From what we can see today, it may not be until Q4 that we start seeing event-based stage migration, as furlough ends on 31 October and the various Government lending schemes close. These movements— will combine to deliver our expected £3.5 to £4.5 billion of 2020 impairment charge expectations, subject, of course, to the economic speed as we see them today. Moving on now to look at risk-weighted assets. Risk-weighted assets decreased £3.7 billion in Q2, as counterparty and market risk were both down £1.5 billion, while credit risk was down £700 million. Counterparty and market risk reductions were driven by NatWest markets, where RWA has decreased by £3.8 billion as the business works towards its full-year reduction target. Counterparty risk in NatWest markets decreased by £1.5 billion, reflecting the exit of specific positions. Market risk also decreased by £1.5 billion as markets normalised during the second quarter. Credit risk reduction was mainly driven by personal banking, where lower spending by credit card customers resulted in reduced undrawn RWAs. For draw-in balances, new lending under Government schemes offset general credit risk migration. Looking forward, RWAs at end 2020 are expected to be in the range of £185 to £195 billion. We have seen little pro-cyclicality in RWAs in the quarter. in line with the low level of overdue payments we are seeing. Moving on to capital, liquidity and funding. We ended the quarter with common equity tier one ratio of 17.2% on a transitional basis under IFRS 9. This is 60 basis points higher than Q1. We are benefiting from 70 basis points of transitional relief in Q2, as well as a reduction in RWAs of 30 basis points. Following a change in the rules, the banks are now required to take 100% IFRS 9 transitional relief on expected credit loss movements in stage 1 and stage 2 provisions from 1 January 2020. The movement in ECL from 2020 is subject to a full add-back in 2020 and 2021, and then unwinds over the following three years to 2024. This change aims to reduce the pro-cyclicality impact caused by increasing ECL. and on a fully loaded IFRS 9 basis, our CET1 ratio was 16.3%. This gives us a strong position both in transitional and fully loaded basis terms. Moving on now to capital and leverage on the next slide. In terms of capital headroom, our CET1 ratio was 830 basis points above the maximum distributable amount of 8.9%. Our total loss-absorbing capital was 36.8%, well above the minimum requirements. This headroom reflects our progress issuing senior debt that's eligible for MREL purposes. Our UK leverage was 6%, which is 275 basis points above the Bank of England minimum requirements. We believe that this excess capital position means that we can manage through the economic downturn and also gives us options in the long term. As Alison said earlier, given the shape and mix of our business, we believe that we should be operating with a CET1 ratio of 13 to 14% over the medium to longer term. We have also maintained strong liquidity levels with a high quality liquid asset pool and a stable, diverse funding base, as you will see on the next slide. Our liquidity coverage ratio for the first half was 166%. reflecting about £68 billion of surplus primary liquidity above minimum requirements. Elevated liquidity levels were mainly driven by deposit inflows as customer deposits increased by £39 billion. Our UK personal banking deposits grew £11 billion to £161 billion, with most of the growth in current accounts as a result of lower consumer spending in the face of both lockdown and increased economic uncertainty. Commercial banking deposits grew £25 billion to £160 billion as customers built up liquidity and retained drawdowns from the Government lending schemes. That significant growth in deposits is driving the seven basis point decline in net interest margin that I spoke about earlier. Our deposit base is well balanced across commercial and retail, and our wholesale funding mix reflects a range of sources and maturities. Our short-term wholesale funding is £22 billion. During H1, we took a decision to repay £5 billion to the term funding scheme and draw £5 billion from the new term funding SME scheme. That leaves us with £5 billion of TFS and an additional £5 billion of TFSM. Moving on to my final slide, an update on targets and guidance. We continue to expect that regulatory change will have an adverse impact of around £200 million on personal banking income in 2020. We maintain our cost reduction target of £250 million for the year. As we decided on an additional property exit this year, strategic costs are expected to be in our original guidance range of £0.8 to £1 billion, rather than the bottom end as we guided at Q1. On impairments subject to economic conditions as we see them today, our full year chart is likely to be in the range of £3.5 to £4.5 billion. And RWAs at end 2020 are expected to be in the range of £185 to £195 billion. As you have heard, we're making good progress in restructuring NatWest markets. and we are now intending to achieve the majority of the expected medium-term reduction in NatWest Markets RWAs by the end of 2021, while managing the associated income disposals to around £200 million this year and a further £400 million in 2021, subject, of course, to market conditions. And with that, I'll hand back to Alison.