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Condensed consolidated statement of changes in equity - GBP (£)
£ in Millions
Called-up share capital
Paid-in equity
Share premium account
Merger reserve
FVOCI reserve
Cash flow hedging reserve
Foreign exchange reserve
Capital redemption reserve
Retained earnings
Own shares held
Shareholders' equity
Non-controlling interests
Ordinary shareholders
Preference shareholders
Total
Balance at Dec. 31, 2018 £ 12,049 £ 4,058 £ 1,027   £ 343 £ (191) £ 3,278   £ 14,312 £ (21)   £ 754      
Ordinary shares issued 45   67                        
Share cancellation (1,5) [1]               £ 0              
Implementation of IFRS 16 on 1 January 2019 (5)                 (187)            
profit/(loss) attributable to ordinary shareholders and other equity owners - continuing operations                 3,283            
profit/(loss) attributable to ordinary shareholders and other equity owners - discontinued operations                 256            
Equity preference dividends paid                 (39)            
Paid-in equity dividends paid                 (367)            
Ordinary dividends paid                 (3,018)            
Shares repurchased during the year [1]                   60          
Unrealised gains/(losses)         (107)                   £ (22)
Realised losses/(gains) [2]         (90)                    
Tax         (8)                    
Amount recognized in equity           573                  
Amount transferred from equity to earnings           (279)                  
Tax           (68)                  
Retranslation of net assets             (428)                
Foreign currency gains/(losses) on hedges of net assets             83                
Tax             (110)                
Recycled to profit or loss on disposal of businesses             (1,480)                
Realised (losses)/gains in period on FVOCI equity shares Gross                 112            
Remeasurement of the retirement benefit schemes other movements [3]                 (142)            
Remeasurement of the retirement benefit schemes, tax [3]                 24            
Changes in fair value of credit in financial liabilities designated at fair value through profit or loss, gross                 (189)           (189)
Changes in fair value of credit in financial liabilities designated at fair value through profit or loss, tax                 20            
Shares issued under employee share schemes                 (6) 39          
Share based payments [4]                 (113)            
Own shares acquired [1]                   (60)          
Currency translation adjustments and other movements                       (11)      
Profit/(loss) attributable to non-controlling interests                       261      
Dividends paid                       (5)      
Equity raised                       45      
Equity withdrawn and disposals                       (1,035)      
Balance at Dec. 31, 2019 12,094 4,058 1,094 £ 10,881 138 35 1,343 0 13,946 (42) £ 43,547 9 £ 38,993 £ 496 43,556
Ordinary shares issued 35   17                        
Share cancellation (1,5) [1]               0              
Securities issued during the period   2,218                          
Redeemed                             (1,277)
profit/(loss) attributable to ordinary shareholders and other equity owners - continuing operations                 (493)            
profit/(loss) attributable to ordinary shareholders and other equity owners - discontinued operations                 121            
Equity preference dividends paid                 (26)            
Paid-in equity dividends paid                 (355)            
Shares repurchased during the year [1]                   77          
Unclaimed dividend                 2            
Redemption/reclassification of paid-in equity (2,6) [5],[6]                 (355)            
Unrealised gains/(losses)         76                   96
Realised losses/(gains) [2]         152                    
Tax         (6)                    
Amount recognized in equity           321                  
Amount transferred from equity to earnings           (50)                  
Tax           (77)                  
Retranslation of net assets             297                
Foreign currency gains/(losses) on hedges of net assets             (55)                
Tax             6                
Recycled to profit or loss on disposal of businesses             17                
Realised (losses)/gains in period on FVOCI equity shares Gross                 (248)            
Remeasurement of the retirement benefit schemes other movements [3]                 4            
Remeasurement of the retirement benefit schemes, tax [3]                 22            
Changes in fair value of credit in financial liabilities designated at fair value through profit or loss, gross                 (52)           (52)
Changes in fair value of credit in financial liabilities designated at fair value through profit or loss, tax                 8            
Shares issued under employee share schemes                 (11) 95          
Share based payments [4]                 4            
Own shares acquired [1]                   (77)          
Currency translation adjustments and other movements                       17      
Profit/(loss) attributable to non-controlling interests                       (62)      
Balance at Dec. 31, 2020 12,129 4,999 1,111 10,881 360 229 1,608 0 12,567 (24) 43,860 (36) 38,367 494 43,824
Ordinary shares issued 37   50                        
Share cancellation (1,5) [1] (698) [7]             698              
Securities issued during the period   937                          
Reclassified (2) [5]   (2,046)                          
profit/(loss) attributable to ordinary shareholders and other equity owners - continuing operations                 2,992            
profit/(loss) attributable to ordinary shareholders and other equity owners - discontinued operations                 276            
Equity preference dividends paid                 (19)            
Paid-in equity dividends paid                 (299)            
Ordinary dividends paid                 (693)            
Shares repurchased during the year [1]                 (1,423) [7] 383          
Redemption of preference shares               24 24            
Redemption/reclassification of paid-in equity (2,6) [5],[6]                 150            
Unrealised gains/(losses)         32                   117
Realised losses/(gains) [2]         (122)                    
Tax         (1)                    
Amount recognized in equity           (687)                  
Amount transferred from equity to earnings           (161)                  
Tax           224                  
Retranslation of net assets             (484)                
Foreign currency gains/(losses) on hedges of net assets             88                
Tax             (17)                
Recycled to profit or loss on disposal of businesses             10                
Realised (losses)/gains in period on FVOCI equity shares Gross                 3            
Remeasurement of the retirement benefit schemes other movements [3]                 (669)            
Remeasurement of the retirement benefit schemes, tax [3]                 168            
Changes in fair value of credit in financial liabilities designated at fair value through profit or loss, gross                 (29)           (29)
Changes in fair value of credit in financial liabilities designated at fair value through profit or loss, tax                 3            
Shares issued under employee share schemes                 8 36          
Share based payments [4]                 (45)            
Own shares acquired [1]                 1,423 [7] (383)          
Currency translation adjustments and other movements                       4      
Profit/(loss) attributable to non-controlling interests                       44      
Dividends paid                       (5)      
Balance at Dec. 31, 2021 £ 11,468 £ 3,890 £ 1,161 £ 10,881 £ 269 £ (395) £ 1,205 £ 722 £ 12,966 £ (371) £ 41,796 £ 7 £ 37,412 £ 494 £ 41,803
[1] In March 2021, there was an agreement with HM Treasury to buy 591 million ordinary shares in the Company from UK Government Investments Ltd (UKGI), at 190.5p per share for the total consideration of £1.13 billion. NatWest Group cancelled 391 million of the purchased ordinary shares, amounting to £744 million excluding fees, and held the remaining 200 million in own shares held, amounting to £381 million excluding fees. The nominal value of the share cancellation has been transferred to the capital redemption reserve.
[2] In 2020, the completion of the Alawwal bank merger resulted in the derecognition of the associate investment in Alawwal bank and recognition of a new investment in SABB held at fair value through other comprehensive income (FVOCI).
[3] Following the purchase of ordinary shares from UKGI in March 2021, NatWest Group contributed £500 million to its main pension scheme in line with the memorandum of understanding announced on 17 April 2018. After tax relief, this contribution reduced total equity by £365 million. There was also a pre-tax loss of £192 million (€224 million) in relation to the re-measurement of the Group’s Republic of Ireland pension schemes, primarily as a result of significant movements in underlying actuarial assumptions (2020: pre-tax gain of £72 million (€81 million)). In line with our policy, the present value of defined benefit obligations and the fair value of plan assets at the end of the reporting period, are assessed to identify significant market fluctuations and one-off events since the end of the prior financial year.
[4] Share-based payments includes a tax credit of £10 million.
[5] In July 2021, paid-in equity reclassified to liabilities as the result of a call in August 2021 of US$2.65 billion AT1 capital notes.
[6] The redemption of paid-in equity includes a tax credit of £16 million.
[7] In line with the announcement in July 2021, NatWest Group plc repurchased and cancelled 310.8 million shares for total consideration of £676.2 million excluding fees. Of the 310.8 million shares bought back, 2.8 million shares were settled and cancelled in January 2022. The nominal value of the share cancellations has been transferred to the capital redemption reserve with the share premium element to retained earnings.