Good morning, everyone. On behalf of the Board and the executive team, I would like to welcome you to our 2014 results presentation. Thank you for coming. Before I hand over to Antonio to go through the results in the normal way. I would like to say just a few words to mark, what I think's, an important milestone in our recovery. When we outlined our strategy update, last October, we noted that we would be entering this next phase of our strategy from a position of strength, having delivered against the key objectives that were set out in 2011. I think the financial performance we're reporting today confirms how successfully the Group has been reshaped, from the depths of the banking crisis, to deliver a low cost, low risk UK-focused retail and commercial bank with a strong balance sheet and restored underlying profitability. As a consequence of that transformation, I'm delighted that the Board has decided we're now able to propose the resumption of dividend payments. We do see this as an important milestone that enables us to start rewarding our loyal shareholders including of course, the taxpayer. However, we recognize that we still have more to do. Restoring our financial health is only the first step. As we look ahead, continuing to rebuild trust, with both our customers and the wider public, is also a business imperative. We're, therefore, committed to continuing to invest in our customer propositions, developing simple, transparent and fair products that our customers want and which they can access through the channel of their choice. We will also continue to support the UK economic recovery through the commitments we have made in our Helping Britain Prosper plan. Through these initiatives, we will aim to rebuild the strength of our customer and public franchise, while, at the same time, delivering sustainable growth, thereby helping us to achieve our twin aims of becoming the best bank for customers and for shareholders. With that, let me hand over to Antonio and George for the results, as usual. Thank you.

Good morning, everyone. Thank you for joining us. I will start with the key strategic and financial highlights for the year, before outlining how our successes in 2014 mark the culmination of four years of strategic delivery that have transformed the business and created a solid foundation for the next phase of our strategic journey. George will then present the financial results in detail, after which, I will remind you of the strategic priorities for the next three years and the outlook for the business. Then, we'll do some Q&A. 2014 was a year of continued delivery or the Group, with the achievement of the key objectives set out in our 2011 strategic plan resulting in a significant transformation of the business and improvement in performance for the benefit of our key stakeholders. We have continued to increase net lending and deposits in our key customer segments across our various businesses and are continuing to support the UK economic recovery. Strategically, we're now a low-risk bank. Since the end of 2010, we have successfully reshaped the business, focusing on the UK and reducing our international presence to only six countries and our non-core portfolio by approximately £150 billion. At the end of 2014, we had a remaining runoff portfolio of less than £17 billion. We have a strong balance sheet and liquidity position. Pre-dividend, our core Tier 1 ratio and leverage ratio have strengthened to 13.0% and 5.0%, respectively and our ratios are amongst the strongest within the banking sector, worldwide. Our funding position is also strong, with a significantly reduced total wholesale funding requirement of £116 billion and a loan to deposit ratio of 107%. As a consequence, our credit default swap spread has tightened significantly, with our current spread of 45 basis points amongst the lowest of the…

Thank you, Antonio and good morning, everyone. I'll give my usual overview of the financial performance and position of the business, starting then with a brief summary of the P&L. As you've just heard, underlying profit increased 26% to £7.8 billion, with the movement in total income offset by a 2% reduction in costs and a 60% improvement in impairments. Excluding SJP from last year's numbers, income was up 1%, while underlying profit was up 40% and jaws a positive 3%. Statutory profit before tax was £1.8 billion, a fourfold increase over 2013 and includes Simplification costs, TSB build and dual running costs, as well as legacy and ECN exchange charges. Statutory profit after tax was £1.5 billion, with the effective tax rate of 15% largely reflecting the impact of tax-exempt disposals, predominantly SWIP, in the first quarter. Turning to the P&L in more detail; net interest income was up 8% to £11.8 billion, driven by better deposit prices, lower wholesale funding costs and loan growth in key segments, partly offset by disposals and expected pressure on asset pricing. The net interest margin of 2.45% is 33 basis points higher than 2013 and 5 basis points higher than the half-year. The Q4 margin was 2.47% and includes a one-off charge of 5 basis points as a result of the consolidation of the savings products range we announced in December. Looking forward, we expect the NIM in 2015 to be around 2.55%, with continued pressure on asset pricing more than offset by improvements in the liability spread and mix and reduced funding costs. In terms of assets and liabilities, total customer assets were down 3% to £478 billion and average interest earning assets by 5%, while customer deposits increased by 2% to £447 billion. Looking at lending and deposits by segment;…

Thank you, George. The successful delivery of the strategy commitments we set out in 2011 has resulted in a significant transformation of our business, in turn supporting our aim of being the best bank for our customers and our shareholders while providing us with a strong foundation to deliver the next phase of the strategy. Last October, we set out a clear and simple strategy for the next three years which builds on the strategic plan announced in June 2011. Our priorities are to continue to create the best customer experience, to become simpler and more efficient and to deliver sustainable growth. We will deliver sustainable growth by capturing significant growth opportunities within our prudent risk appetite and, over the next three years, we expect to grow net lending to our key customer segments by £30 billion. To achieve this, we target to maintain our market leadership position in the competitive and key markets of mortgages and current accounts and to outgrow the market in areas where we're currently underrepresented. We expect to outperform the markets in our SME and mid-market segments, increasing net lending to each of these business customer segments by over £3 billion in the period. In our consumer finance division, we also expect to outperform the market by growing UK customer assets by £6 billion with our auto finance business achieving double-digit growth and increasing customer assets by £4 billion and our credit cards business delivering a £2 billion increase in customer balances. Over the next three years, we also expect to grow customer assets in our insurance division by £10 billion through the enhancements we're making to our retirement planning proposition and by leveraging the Group's operational scale, customer reach and insight. In conclusion, the successful delivery of our strategy has transformed the business, enabling…

Chris Manners from Morgan Stanley here. I guess three questions, if I may? The first one was on the net lending growth target of £30 billion; obviously, returning to net lending growth on a Group basis something we'd all love to see. Just trying to understand, is that the total loan book, is that the franchise loan book, how should we think about that growth and where do you see it coming in which segments? The second point was on the NIM guidance; obviously, NIM dropped in the fourth quarter. I think everyone was really encouraged to say it was going to rise in 2015, given assets growth compression mentioned, just maybe a bit more color on where that uplift is going to come from; presumably deposit pricing is going to be part of it? And the last one was on your capital stack; saying 12% now, how do you think about the D-SIB buffer, because we thought you might have a 3% D-SIB buffer, going forward and just the components there? Thanks.

Thank you, Chris. I will answer you the first question and then George will take two and three. So the £30 billion refers to the increase in our key customer segments, as we have been describing them every quarter which is basically £6 billion on both SMEs and mid-corporates, £3 billion each which means according to present expectations to grow around 5% in SMEs as we have been growing and to increasing our growth in mid markets from 2% upwards. So the target is £3 billion in SMEs, £1 billion per year, £3 billion in mid-corporates, £1 billion for the year, £6 billion for those two segments over the next three years. Then you have another £6 billion in consumer finance, our high growth area division, where I said £4 billion will be on the car financing business and double-digit growth we expect for the next three years and £2 billion on credit card balances. So another £6 billion. The remaining £18 billion is what we foresee to grow on the mortgage markets, where we're assuming, after last year's growth of close to 2%, we think this year will again be around 2%; therefore, assuming the market growth for the next three years. And we will grow with the market; we will grow £18 billion in terms of mortgages over the next three years. So I'm leaving out, just to clarify for your model, as always I'm leaving out the £17 billion of the rundown. I'm leaving out the closed book debt we have in terms of Dutch mortgages. And I have not mentioned our overdrafts in the retail area and the large corporates. Large corporates, as you saw in the 2014 results, was the reason why the target segment, the core book, did not grow at 2%, 3%, because large corporates came down. I have mentioned repeatedly in our quarterly meetings and presentations that large corporates we don't target credit growth because of debt capital markets, market conditions. On the previous year, we had grown a lot large corporates. Last year, we reduced because of lower margins, more risk progression in the market that we did not want to join. I expect, during 2015, large corporates to grow in line with the average of the other segments. So I do expect the core of the Bank to grow between 2%, 3%, the average of everything that I just told you. Was that clear?

Very.

George, could you please on NIM and capital stack?

On NIM, Chris, as you see the current NIM for 2014 of 2.45% which was up from the 2.12%. And the main drivers to that which we set out in the waterfall I had over 20 basis points on the liability side. I had an accounting benefit from the ECNs. Going the other way, I think there was about 7 basis points for, basically, mortgage pricing and I also get a benefit from wholesale funding. As you say, the Q4 bit was a one-off. It was the 5 basis points from consolidation savings. But with all those features as well, all those other elements featured in that, of course, as well. So we did see a further benefit from wholesale funding Q4 versus Q3. We did see a further benefit from deposits Q4, Q3 and a bit of asset. As we move forward, the story will sort of remain the same. I think there's still a bit of headroom in terms of liability pricing. I do expect to see a bit of asset pressure as we move forward, although it's interesting in terms of as expectation of rates move out and what that does on things like SVR. What I do also expect to see is further benefit from lower wholesale funding. And I will see that in terms of, as a lot of crisis funding continues to roll off and replaced by something that's much more reflective of where the Bank currently sits in terms of cost of money and I see that benefit coming through. So as I said, we've given our guidance, I think it's pretty robust guidance and I think I've got a positive outlook. On capital yes, we said around 11%, we're now saying around 12%. What has happened since, I think, as we talked through last year we said there were risks involving regulatory conversations continue that there was a risk there that it would increase. And we have pushed it up. That reflects us passing through a couple of stress tests, ICG conversations, etcetera and just factoring all those in. I think the capital debate has moved forward. It's interesting to see what everyone has come out with over the last week in terms of expectations of the coalescing around numbers. We're not a G-SIB, so we don't have that specifically applying for us. There are still some uncertainties. You know what's coming out of Basel and whether it's standardized operational risk we still have to work through those. But for now, we certainly think around 12% is reflective of where we see ourselves and how we see ourselves in comparison with our peers, compared with our low-risk business model that we operate. But that's where we sit.

And we're keeping the target return on equity of 13.5% to 15% to the new capital target of around 12%.

Thanks. Just to clarify, I was talking about D-SIB rather than G-SIB. So obviously, you put up the slide showing how strong your market share is now and how important you are to the UK economy. I thought you might have a high D-SIB buffer.

The reality is actually, whilst I say that we're not a G-SIB, I would expect that we will probably get treated like a G-SIB.

Tom Rayner from Exane BNP Paribas. Yesterday, one of your peers talked about its capital targets as well, 13% for them, above which they felt they'd be happy to start distributing all their free cash flow effectively. Irrespective of the debate whether it's 12% or 13%, you're pretty much at 13% yourselves anyway. Eligible Tier 1 is above 2% which I think is more than you need and your eligible Tier 2 is nearly 4%. So on a fully factored in CRD IV basis, I think you're 19% total capital, so a long way ahead of your peers. So when I looked at your guidance for 150 basis points to 200 basis points of capital generation, I guess my question is, pretty soon is there any reason why you shouldn't be able to start distributing if not all of it, pretty much all of it? And then my supplementary question to that would be, if you're not allowed to and you're building up bigger pots of surplus, as will some of your peers be, is there then a risk that we see more margin pressure coming into the industry because the other thing that will start happening is you start competing for more volume in an environment where loan growth might still be on the slow side. So that's my question, thank you.

I'll just offer a few comments because we're not going to give you any more guidance on future dividends than the one that we have said. It's a nice problem to have, number one. Number two, we'll take it step by step. So we're really proud of getting dividends back to shareholders and to our 3 million individual shareholders and taxpayers, after 2008 for the first time. We said we would start at a token level. As you very well said, we have finished the year better than we thought with a 13% fully loaded capital ratio, pre dividend. And we will take it semester by semester. So we will set up an interim, we'll see at yearend and we will discuss at the Board then and we will set the specific dividend at each moment. It is clear that we intend to move to a payout ratio of at least 50% of sustainable earnings, over time. And it is clear, as George told you, that we believe we'll create 1.5% to 2% of capital per year because and this is very important, because we have a business model which is both low risk and low cost. This is critical. We have these two key competitive advantages. The low risk drives not only impairments down, but should drive the cost of equity and the capital requirements down. That's why, as George said to Chris, if others are now mentioning 13% or 12% to 13%, we, as a low-risk bank, we believe we're very comfortable on the low end of around 12%. And second, having a cost to income of 51%, when all of our major peers are between 58% and 67% gives us a major competitive advantage in terms of providing better products to clients at the same time as we have superior returns to shareholders. So all of it results from the fact that, not only we have a simple business model focused in UK retail and commercial banking, but we have two critical competitive advantages of the lowest credit default swap or risk if you want and the lowest cost to income in the UK.

And on the margin bit of the question, if somebody stops you distributing the dividends, what do you do instead? Do you start competing more aggressively for faster volume, I guess.

It's a nice problem to have, Tom. We will take it then, if it happens.

Chintan Joshi from Nomura. Can you give us some update about the SVR book? Constantly, it's pointed out as something that is a risk factor; just want to get an update. From what I can see from industry trends, it shouldn't have picked up in churn rate, but wanted to see what you are seeing, that's the first. And I've got another one on margins.

Do you want to say the second one as well?

Yes. Just if you can elaborate on your hedge assumptions within your NIM guidance for 2015.

Yes, on the SVR book, we've seen pretty stable trends, actually. And the one that people focus on particularly, in terms of the Halifax book, the [inaudible] we came in at about £61 billion at the start of the year. The movement in the balance, I think, is a reduction of about 7% which will be consistent with, actually, our totality of SVR book. It's not actually in line with the movements in books with lower rates on. It's come down about 7%. So it's [inaudible] or whatever, in terms of closing, but we've seen a pretty stable trend. And obviously, one of the - and we alluded to this in one of the earlier questions, one of the benefits of base rate rises being put back is that that has remained pretty sticky and I think we expect it to stay with us for some considerable time. But that's what we're seeing. In terms of hedge assumptions, we continue to be well over 90% invested. We've put premium by stable, predictable earnings and that reflects our policy on hedge. We don't see material shifts in terms of reinvestment rates, the differentials between earned and reinvestment in terms of roll-offs, etc. There's not a huge proportion of the hedge that's expected to roll next year. So I'm not actually looking at a big differential in terms of 2015 plays 2014, in terms of structural hedge contribution to earnings. As you know, we've got a targeted weighted average life of about five years. We're currently inside of that; we're shorter than that, at the moment. So the strategy remains pretty unchanged, as I say. And we see earnings year on year, it doesn't have a material impact in terms of overall shape.

And just a follow-up on actually both points. On the hedge, agreed, 2015 versus 2014, not much impact. Assuming the current yield curve, would you see some impact in 2016 or 2015? That's on the hedge. And on the SVR, can you talk about trends also on your buy to let book, if you are seeing any increase in churn there? Or is it similar to the SVR churn rate?

I'm not aware of any different trends on the buy to let book. I've not seen any different trends there. 2016, 2017, all those sorts of things, it's a way out and depends upon what rates do and obviously, there's been movements over the last month. So in terms of how hedges roll off and reinvestment rates, when you move out 24, 36 months, let's see what's in the market and see what rates are available then.

Arturo De Frias from Santander. First of all, congratulations to you and the team for a truly remarkable turnaround. And then, a couple of questions; one on dividends and one on long-term strategy. I was going to ask the same question that Tom asked, about you not being allowed to pay nearly all of it. So I will rephrase slightly the question and focus more on the short term,(laughter) and ask, the 0.75p that you are announcing today corresponds to 44% payout ratio. I'm sure you wouldn't like to start with 44% and then come down. So should we assume that, at the very least for 2015 onwards, we're going to see that 44%? That's the question on dividends. And then, the question on strategy; it is true that you have a remarkable advantage on costs and on funding to grow. But it's also true, as you show us in this chart on market sales which I found really interesting, that you have already very high market sales in some of the key markets; current accounts, mortgages, SMEs. You also said that you don't want to grow in large corporates. Of course, you can grow a lot in home insurance, in credit card, in consumer finance, etc., but the biggest books, you already have 20-plus-% market. And also, there is a limit to the growth that you can achieve there. Knowing that the transformation is pretty much done, could you share with us your thoughts in terms of non-UK growth, inorganic growth, international expansion in the medium term? Thank you.

So three comments on what you said. The first in terms of dividends, we're not going to anticipate anything else. I understand your problem. We'll leave it to each one of you to make your own assessments and we'll discuss it, for sure, over the next few quarters. Strategically speaking, Arturo, I think you are right. But we see significant growth possibilities and I think that is demonstrated by what we started doing as we had said we would do. Because I think the interesting thing in terms of our strategic plan is not only what we did, but that we did what we said we would do, because sometimes, it's not exactly the same thing. And we said to you, 2 or 3 years ago, it starts growing aggressively in consumer finance. This has been done. The car financing portfolio grew at more than 25%, where the market grew around 11%. And we believe we also grew around 11%, if you want same footfall basis. But given that we won the Jaguar Land Rover representation, that more than doubles our growth in car financing which is very important; it's one of the main brands in the UK. We told you we would start increasing the credit card portfolio. And we did it finally, over three years, last year, as targeted, where it grew by 2% and you have growth targets which are much bigger for credit cards, going forward. On credit cards, to give you an idea, we only have 15% market share. We never did the non-franchise business, so we have a huge opportunity on the non-franchise business, as we do and have in executing well on the franchise business. In SMEs, well, we have grown 20% net over the last four years, in a market that shrank…

It's Rohith Chandra-Rajan. If I could come back to the margin expectations for next year please and you've given us a lot of detail on the asset side. Just on the deposit side of the margin math for next year, certainly some of your peers are talking about relatively flat deposit margins. I was wondering if your expectation of the liability side is more to do, certainly on the deposits, is more to do with mix shift in your book, either between brands as you've talked about before or from time to sight deposits?

In the explanation I gave earlier yes, the components we've seen will continue to play a part, I would have thought, in terms of different weightings, wholesale funding is going to play a bigger part as we move through next year; that's going to be a large part of that. You've seen this year and you'll continue to see next year, our ability to flex between brands is an advantage. And you've seen that this year; you will see more of that next year. But also in terms of shaving a few basis points, etcetera., I still see that possibility within the core retail and commercial banking core deposits as well. So I see that possibility.

And then just very briefly just on your other income comment which clearly has been an area that's been more challenging, I guess, over the last few years. Just wondering about your confidence of stability in that line for next year and what are the headwinds, so things like interchange fees, etc.?

Yes, it's a good question and you're right, it's been an area where it's been hard, for factors and reasons that we all know. And as you allude to one there, as we move forward there continue to be challenges. So our comment of broadly stable was fully appreciative of what's happening in all this change and that's factored in for 2015, so that's already in there. But across the book there were some encouraging signs. I talked about in the presentation in terms of commercial, for example which had a very strong Q4 and came back strongly. We're also making investments across the business; I talked to some things in insurance with regards our aspirations and hopes around things like corporate pensions, bulk annuities which we're investing money in as well as additional offering. And would hope that to see a rebound in the insurance contribution. But the environment stays tough and in terms of retail, I think it will continue to be a tough environment, just given the product mix and the environment that we're in. But I think broadly stable is a fair assessment. I would hope for growth thereafter in 2016 and onwards, but my expectation is it's going to stay a pretty tough market for fee generating products.

It's Andrew Coombs from Citi. Firstly, if I could possibly just follow up from the previous question; on the other income point, we talked about the interchange fee cap there; you've also got TSB dropping out at some point during the year; you've also got the runoff contribution presumably declining, so there are a number of headwinds. You talked about a tough environment for retail products, but there must be an offsetting positive somewhere, so perhaps you could just elaborate on where you see that coming through from; is it the commercial bank or--?

It's the previous explanations, commercial and insurance. Insurance as I said, there were some adverse economics that they have to deal with which is just the wonders of insurance accounting in terms of how we discount some of the free assets. But there are some initiatives in insurance. And as I said, yes, commercial banking had a very strong Q4 bucked the trend and particularly in the financial and capital markets put in a good performance. We have hopes but, again, it will take time.

Just a broader question on mortgage pricing. When you look at the number of competitors, there's been some quite substantial rate cuts made over the past three to four months. If we look at Halifax, there has been some adjustments but they haven't been of the same magnitude and that's been a consistent point that Lloyds have made. So I guess I was wondering, when you think about the pricing differential, how much does your scale and your service proposition, how much of a differential does that allow you to maintain whilst remaining competitive?

Of course, we look into all of what you just said. And the fact is that we grew broadly with the market last year, as was our objective and we continue to believe we will grow in line with the market this year and we don't necessarily have to have the lowest prices for that. That's one comment. The second one is, as you know, we have a multi-brand strategy which I continue to believe is a competitive advantage, especially in a low interest rate environment. And the third one is that we manage the margin, not separately, but as the difference of the two, between loans and deposits, we do it on a weekly basis and we do it at the highest level of the organization which is another competitive advantage. So I would expect, as George said before, that the environment in terms of margins of assets, minus margins of liabilities, to continue to evolve broadly in the same way over the next few quarters.

It's Fahed Kunwar speaking from Redburn. I had a couple of questions. The first is on your statutory ROE target of 13.5% to 15%. So your adjusted ROE in 2014 was 13.6%, I know your statutory was only 3%, but I'm assuming you don't have a legacy cost, going forward, in the medium term or at least they drop out. I'm just wondering why the target is so low, I guess. You moved from 11% to 12% right now in your core Tier 1, are you potentially factoring in the fact that that might actually keep increasing and you would like to hit that target, even if you have to hold 13% or 14% core Tier 1 or is there something else going on in that number? I can give you my second question now as well. The second question actually is on other income, but it's actually in another manner. A lot of the European retail banks are talking about a move from retail customers and some small corporate customers moving from deposits into AUM, other type of saving products now. You're probably the preeminent bank assurance model, definitely in the UK and I know there are near-term headwinds to ORR [ph], but going forward, why is that happening in the UK and if not, why do you think it won't happen in the UK, going forward? Thanks.

The 13.5% to 15% I think is an entirely appropriate target and I think stands good comparison with the previous target the Bank had when we put out the first the strategy review in 2011, so we've improved it. And I think it stands very good comparison with the targets of our peers, so I think it's an entirely appropriate and a good target. In terms of just some elements around calculation you're right, the expectation is, as we move forward and those below the line items drop away, you should see a convergence between the 3% and the 13%, just taking those as static numbers. There will, though, always be some element to drag; you'll have things like fair value unwinds, you'll have amortization of cost, etc., so you're not going to have a complete one for one. But there will, as you say and I've said, there will be a significantly lower level of dilution as we move forward. What we have also seen is that assumptions change and when we introduced that in October that was based around a capital requirement of around 11% and we had base rate assumptions for 2017, I forget whether it was 2.5%/3%, etc. And what we said at the time was that we would, if we saw movement in those assumptions and we've now seen something on capital as base rates continue to move around, we would look to absorb those and stick by those ROE targets. We've seen a movement on capital as those base rates continue to move, but we're sticking with our target and will continue to do so if we see further wiggle room, I think, in terms of some of the key elements of that. So it's an appropriate target; we would stick by that target and what you will see. As I said, those ROEs, the statutory and the underlying come together.

On your second question, yes, it's quite an interesting question, strategically I mean. I would make two or three comments. The first is that we have, as you said, a major opportunity in that area, because we have the largest presence in retail in the UK and we're underweight in terms of assets under management, as you said. And we both have Scottish Widows in terms of insurance products, but we also have the partnership that we recently initiated with Aberdeen which we really value. So we have both product, if you want, asset management and insurance products available. The first one. The second one is we will develop that of course which is a major opportunity. But relating to the European context and the move to direct our customers towards those products, I think we're going to be careful. And we're going to be careful for two reasons. First, we want absolutely to be best bank for customers, so we have to think what is the best interest of the customers. And I personally have some doubts, then in the lowest interest rate environment of the last century, it is a good idea to move clients into fixed income products that will be exposed to rising interest rates which I think are inevitable. The question is when. And second, we have to do this in a conduct appropriate way and we have been working very seriously with the FCA in terms of execution only products, versus advice how to do it in Internet, mobile and this will take some time to develop. So I would say versus Europe, you have a totally different approach in terms of Europe which I think is leading the UK and Europe should start thinking about. Second again, in the interests of our customers, I would be very careful in trying to push our customers to fixed income products in spite of the cycle.

Can I just quickly follow up on a couple of points? Sorry, on your 12%, 13.5%, 15%, you probably won't answer this question, but how high does the core Tier 1 have to go before you potentially bring that target down, i.e., how much is built into it?

You're right, I won't answer.

It's Ian Gordon from Investec. I've got three pretty dull questions, actually. First one, can you just update me on your expectations and intentions on the residual ECNs? In December, you seemed to be only talking about --

That's a good question, residual.

In December, when you updated the market, you were only talking about a portion of the residual ECNs, whereas the Daily Mail may disagree with me, I don't understand why you don't get rid of the whole lot or at least convert them. Secondly, just coming back to conduct, sorry to be boring, but with regard to the £200 billion of other, other legacy charges in Q4, can you just provide a bit of color of what that is? And then finally, Irish provisioning. I know you don't give us real quarterly disclosures, but it think in Q4 there was, for the first time, a release about £50 million or £60 million which probably just reflected where certain disposals fell, rather than a proactive write-back. I appreciate there's less granularity of future trends for you, because of your residual £2.6-odd-billion Irish provisions, it's mainly corporate not retail. But you are now starting to look rather more conservative and rather more fully provided than some of your peers. Is that [inaudible] or is there real conservatism baked in? Thanks.

On ECNs our position is clear. We announced that a capital disqualification event that occurred in the non-treatment of these as core Tier I capital in the stress test. We made that determination and we've applied to the PRO. We made that application on December 18 and the PRO they know they have three months to make their determination. They actually determine, not around the capital SJP incurred, but simply around capital positions, etc. We made on December 18 and we await that response. In terms of where we're going, we've been very clear in terms of apportion. Those prioritized bonds, those that we touch, where we will be exercising the regulatory par call. But that will not be the end of the story in terms of where we go with that overall residual holding. So your point is valid that there was more action that we will take there. In terms of the other or other, there's a number of items which is material unto itself. It relates to things like, in terms of the incentive schemes. Things like bank assurance, there's a portion in for that. We've got a portion in for things like forbearance. We've got associated legal costs. So there's a list of things, none of which is material unto themselves that go into that.

In Ireland, you are right, we have sold two big portfolios in Q4. We did the first one in 2013, because we sold non-performing loans of the mortgage book in Ireland. We have done the same in 2014 and then you can see that the level of arrears in the mortgage book of Ireland is very low now. And we have sold also a big portfolio of commercial loans in Ireland in Q4. The three transactions have had write-backs and I think you are right that we have conservative approach to our Irish book. The only thing I would say, it is not new, so it has been since the beginning.

It's Raul Sinha from JPMorgan Cazenove. Can I have two, please? Firstly on capital; I was wondering if you could tell us if you would be disclosing your capital stack, going forward. And the reason for asking the question is, I wanted to check if you have assumed a buffer within your capital requirements for potential countercyclical increases. I know it might be a very long way away, but it does give us some clarity about how well capitalized you are, even relative to the 12% and how that can move. And obviously, the latest consultation allows you to disclose Pillar 2A. So that's the first question. Now the second one is on your 2.55% NIM guidance, pretty straightforward. Have you assumed any interest rate hikes for that or within that? And if you could comment on, if base rates were to go up in the second half of the year, how that would impact your margin, going forward? Thanks.

On the capital stack, the around 12% we would have allowance for small management buffer in there. In terms of disclosures, I may take a pause on that. Yes, as you said we've got the 2A out for the first time, along with everybody else. But I don't know about additional disclosures, so if we have a pause for thought in terms of where we go on capital. I know what people would like to see. There's an issue of what we're allowed to show and what would be useful to show. So I hear what you say, but it's something that we will ponder. NIM, the house view is the back end of the year if it's going to happen would be our earliest scenario, so our 2.55% is not dependent upon a base rate increase. And I think, as we previously said, given position of structural hedge and then there are questions of how much you'd pass through. But certainly, in the early base rate movements, don't expect to see particularly sensitive in terms of earnings with those base rate changes.

[Inaudible]. A couple of questions, please. One, just on the runoff portfolio; that's obviously come down more than was previously guided last year and I wonder whether you could update us on your thinking for the runoff of that portfolio this year and when we might finally see to the end of that. And then secondly, just back to insurance, because I always feel that this division's a bit of a sleeping giant, really. I know you've got some ambitions which you've set out for us today and I just wonder when we might really expect insurance to start returning to profitability growth. It seems to have been going the other way over the last few years. So when will we actually see profits in the insurance division turn positive again?

Okay. Starting on second one and [inaudible] will give you color on the first one, because for the first time we're not targeting runoff decreases, because we consider it's basically even, but Juan will give you some color on that. Now on the insurance company, like George mentioned, the insurance company decreased the profitability because they had quite an adverse environment last year. On one hand, we had the floods which affected our GI business very significantly. There were floods in several moments of the year, much more than the average. And secondly, because the levels of these changes, that changes the plans that we had for annuities and that's also impacted the corporate pensions. That's why, as George mentioned, there were abnormal circumstances and apart from that, the three-year plan that we have for insurance is of growth from a stable base. So those are the plans that we have and insurance is an integral part of our business. And I think we have established significant competitive advantages from having insurance within the Bank. On one hand, we're able to much better respond to changing customer needs because we have it in-house so the teams can work together before changing customer needs. Like you have, for example, for that coming change in pensions in April that we don't know how the customers are going to react, but we're fully prepared. Secondly, by the fact that we have the operations centralized we have lower unit costs. And third, we were also able to swap portfolios that were mutual beneficially between the Bank and the insurance company in terms of long duration portfolios being bought by the insurance company that has long-dated liabilities and that were no longer appropriate for the Bank, given the changing liquidity rules. So this is just an example of the three major synergies we have created, as we have been explaining through the years. So we're absolutely convinced that the plan is upwards and what you mentioned which is correct, was really due mostly to very adverse trading conditions last year in several of the products.

Just want to clarify that, leaving weather-related events aside which is obviously unpredictable, should we expect there to be some profit growth within the division this year?

Well, as I said in my presentation, we're looking actually for a stable result, but what that reflects is management initiative, real initiatives in terms of, as I said, corporate pensions, bulk annuities, GI, etc., being offset by a quirk of accounting. From an accounting perspective what was one does is you discount the free assets basically using swap rates where swap rates are moved. So from an accounting perspective of the underlying profit level, I start with that headwind, but actually those initiatives will take me back. When swap rates return to more normal levels, you'll get the benefit of that coming thorough. So what matters is from a management action underlying basis, that division is moving forward, accounting is holding it back.

Yes, on the run-off you can see in the appendices the detail of it, we have £17 billion. It is £6 billion retail international and £11 billion is the commercial bit. The idea is to continue with the strategy of decreasing it, so we have to complete it because runoff has to be run off. And that's the idea, so we will continue with it, but we're not disclosing any targets because we think it is not material any more.

I think we will probably emphasize even a bit more value versus volume, given we achieved the volume. In the end of last year we were able to do the transactions already. We've free capital impact positives. We had capital gains on many transactions as you know, apart from the capital accretion. And we will give even more focus to the value versus the volumes, given that it's basically achieved and there is no significant risk in the portfolio any more.

It's Sandy Chen from Cenkos Securities. Actually, this is probably the second question, just a follow-up on insurance, two insurance questions in a decade is probably quite good. I would just like to look more closely at your insurance volatility assumptions, underneath it, because on page 31 just looking at the yields on UK Government bonds, it had gone up from assumed yields of 2.6% in 2013 to 3.5%. Corporate bond yields have gone up from 3.2% to 4.1%. I'm just trying to tail that with what were you saying in terms of volume swap rates and what the underlying assumptions are in the insurance business because, when I look at the expected investment returns versus the actual, I noticed there was a gap of £219 million on the insurance business. Should we take that out of the underlying insurance PBT as an actual?

You get very volatile results if you do. Obviously, over time, my positives and negatives in terms of investment fluctuations around those long-term reserves, long-term assumptions, should sum to zero, but in any short period of time they will not. You can look at the total insurance result at a profit before tax line, but because of the vagaries of the accounting in terms of just defining any trend in that you will struggle. The comment around the swap rates is a look-forward comment, so that's particularly in terms of 2015 and it's one particular aspect to it. So it's something that you won't see in those assumptions, but you'll see it in our numbers that come through. So if you look to the profit before tax line you'll see how that result has been impacted by actual market returns in the period. The reason why the insurance industry has gone that's a long-term assumption whereas you're dealing with products with 10, 20 years and the vagaries of how they get impacted on a yearly basis by some of those investment returns doesn't give you the good indication, hence the underlying.

I guess it kind of leads to a follow-on question in terms of, how does this compare to your assumptions on your own pension liabilities?

I can't give you an answer today in terms of line by line. We can get back to you with a comparison.

No more questions? Okay. Thank you very much, everyone for coming. See you shortly.