| UK Banking | ||
|---|---|---|
| 2005 | 2004 | |
| £m | £m | |
| Total income (b) | 6,045 | 5,658 |
| Impairment charge(c) | (344) | (199) |
| Operating expenses | (3,243) | (3,241) |
| Associates and joint ventures(d) | (3) | 47 |
| Profit before tax | 2,455 | 2,265 |
UK Banking (which comprises UK Retail Banking and UK Business Banking) produced good profit(e) growth, up 8%, to £2,455m (2004: £2,265m) and outperformed its productivity target for 2005 with the cost:income(f) ratio improving by three percentage points to 54% (2004: 57%).
| UK Retail Banking | ||
|---|---|---|
| 2005 | 2004 | |
| £m | £m | |
| Total income (b) | 3,534 | 3,412 |
| Impairment charge(c) | (142) | (60) |
| Operating expenses | (2,359) | (2,433) |
| Associates and joint ventures(d) | (6) | 44 |
| Profit before tax | 1,027 | 963 |
UK Retail Banking achieved solid income(b) growth of 4% in 2005, with a marked pick-up in the second half of the year which we believe establishes good momentum for 2006. Operating expenses decreased 3% through strong cost control whilst continuing targeted reinvestment to improve customer service and the branch network. Profit before tax grew 7% to £1,027m (2004: £963m). Excluding the gain on the sale of our stake in Edotech in 2004, underlying profit before tax increased 12%.
| UK Business Banking | ||
|---|---|---|
| 2005 | 2004 | |
| £m | £m | |
| Total income | 2,511 | 2,246 |
| Impairment charge(c) | (202) | (139) |
| Operating expenses | (884) | (808) |
| Associates and joint ventures(d) | 3 | 3 |
| Profit before tax | 1,428 | 1,302 |
UK Business Banking profit before tax increased 10% to £1,428m (2004: £1,302m), driven by strong income and balance sheet growth. Operating expenses grew slower than income, leading to an improved cost:income(f) ratio of 35% (2004: 36%).
Notes
- Economic profit is defined in the Chairman's statement.
- Total income net of insurance claims.
- Includes other credit provisions.
- Share of post-tax results of associates and joint ventures (together with profit on disposal of associates and joint ventures, where relevant).
- Profit before tax.
- Operating expenses compared to total income net of insurance claims.
- Absa has changed its financial year-end to 31st December to conform with Barclays, the comparable period comprises unaudited results for the nine months ended 31st December 2004.
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