v3.25.4
Operating expenses
 12 Months Ended
Dec. 31, 2025
Disclosure of expenses [Abstract]  
Operating expenses Note 10: Operating expenses
2025
£m
2024
£m
2023
£m
Staff costs:
Salaries and social security costs1
3,846
3,819
3,651
Pensions and other retirement benefit schemes (note 12)
527
526
355
Restructuring and other staff costs
334
327
487
4,707
4,672
4,493
Premises and equipment costs2
503
454
449
Depreciation and amortisation3
3,477
3,426
2,905
UK bank levy
130
147
150
Regulatory and legal provisions (note 28)
968
899
675
Other
2,786
2,594
2,720
Operating expenses before adjustment for:
12,571
12,192
11,392
Amounts attributable to the acquisition of insurance and participating investment contracts
(191)
(182)
(183)
Amounts reported within insurance service expenses
(414)
(409)
(386)
Total operating expenses
11,966
11,601
10,823
1Including social security costs of £454 million (2024: £428 million; 2023: £371 million).
2Net of loss on disposal of operating lease assets of £10 million (2024: profit of £59 million; 2023: profit of £93 million).
3Including depreciation in respect of premises £101 million (2024: £96 million; 2023: £110 million), equipment £349 million (2024: £400 million; 2023: £388 million), operating lease
assets £1,470 million (2024: £1,410 million; 2023: £1,070 million) and right-of-use assets £182 million (2024: £198 million; 2023: £209 million).
Average headcount
The average number of persons on a headcount basis employed by the Group during the year was as follows:
2025
2024
2023
UK
60,331
64,334
65,390
Overseas
3,707
1,895
807
Total
64,038
66,229
66,197
Performance-based compensation
The tables below analyse the Group’s performance-based compensation costs between those relating to the current performance year and
those relating to earlier years.
Performance-based
compensation expense
Performance-based compensation expense
deferred until later years
2025
£m
2024
£m
2023
£m
2025
£m
2024
£m
2023
£m
Awards made in respect of the year ended 31 December
343
300
316
83
90
108
Awards made in respect of earlier years
92
96
124
37
34
22
435
396
440
120
124
130
Performance-based awards expensed in 2025 include cash awards amounting to £225 million (2024: £162 million; 2023: £169 million).