v3.25.4

Credit risk (Tables)

12 Months Ended

Dec. 31, 2025

Credit risk [Abstract]

Schedule of Loans and Advances to Customers

Movements in the gross carrying amount for loans and advances to customers and for allowance for expected credit losses were as follows:

	Gross carrying amount										Allowance for expected credit losses
	Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m		Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m
At 1 January 2025	405,360		44,765		6,716		6,207		463,048		736		1,160		1,108		187		3,191
Exchange and other adjustments1	1,034		(17)		3		8		1,028		(13)		(1)		18		45		49
Transfers to Stage 1	7,165		(7,021)		(144)				–		240		(221)		(19)				–
Transfers to Stage 2	(10,427)		11,211		(784)				–		(53)		114		(61)				–
Transfers to Stage 3	(1,557)		(1,871)		3,428				–		(35)		(157)		192				–
Net change in ECL due to transfers											(153)		257		350				454
Impact of transfers between stages2	(4,819)		2,319		2,500				–		(1)		(7)		462				454
Other changes in credit quality2											27		(46)		677		11		669
Additions and repayments	28,618		(4,388)		(1,606)		(1,130)		21,494		(12)		(29)		(140)		(75)		(256)
Charge (credit) to the income statement											14		(82)		999		(64)		867
Disposals and derecognition	–		–		–		–		–		–		–		–		–		–
Advances written off					(1,296)		(9)		(1,305)						(1,296)		(9)		(1,305)
Recoveries of amounts previously written off					209		–		209						209		–		209
At 31 December 2025	430,193		42,679		6,526		5,076		484,474		737		1,077		1,038		159		3,011
Allowance for expected credit losses	(737)		(1,077)		(1,038)		(159)		(3,011)
Net carrying amount	429,456		41,602		5,488		4,917		481,463
Drawn ECL coverage3 (%)	0.2		2.5		15.9		3.1		0.6

1Exchange and other adjustments includes the impact of movements in exchange rates, discount unwind, derecognising assets as a result of modifications and adjustments in respect of

purchased or originated credit-impaired financial assets (POCI). Where a POCI asset’s expected credit loss is less than its expected credit loss on purchase or origination, the increase in

its carrying value is recognised within gross loans, rather than as a negative impairment allowance.

2Includes a credit for methodology and model changes of £136 million, split by stage as £41 million credit for Stage 1, £47 million credit for Stage 2, £52 million credit for Stage 3 and

£4 million charge for POCI.

3Allowance for expected credit losses on loans and advances to customers as a percentage of gross loans and advances to customers.

Movements in balances for the year ended 31 December 2024 (audited)

	Gross carrying amount										Allowance for expected credit losses
	Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m		Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m
At 1 January 2024	385,294		53,167		7,147		7,854		453,462		900		1,467		1,137		213		3,717
Exchange and other adjustments1	(910)		(23)		(74)		12		(995)		(12)		(6)		21		53		56
Transfers to Stage 1	25,658		(25,607)		(51)				–		413		(404)		(9)				–
Transfers to Stage 2	(25,390)		25,967		(577)				–		(66)		126		(60)				–
Transfers to Stage 3	(1,104)		(2,119)		3,223				–		(21)		(178)		199				–
Net change in ECL due to transfers											(293)		340		303				350
Impact of transfers between stages2	(836)		(1,759)		2,595				–		33		(116)		433				350
Other changes in credit quality2											(130)		(66)		709		66		579
Additions and repayments	22,529		(6,140)		(1,612)		(910)		13,867		(50)		(107)		(193)		(72)		(422)
Charge (credit) to the income statement											(147)		(289)		949		(6)		507
Disposals and derecognition3	(717)		(480)		(366)		(694)		(2,257)		(5)		(12)		(25)		(18)		(60)
Advances written off					(1,174)		(55)		(1,229)						(1,174)		(55)		(1,229)
Recoveries of amounts previously written off					200		–		200						200		–		200
At 31 December 2024	405,360		44,765		6,716		6,207		463,048		736		1,160		1,108		187		3,191
Allowance for expected credit losses	(736)		(1,160)		(1,108)		(187)		(3,191)
Net carrying amount	404,624		43,605		5,608		6,020		459,857
Drawn ECL coverage4 (%)	0.2		2.6		16.5		3.0		0.7

1Exchange and other adjustments includes the impact of movements in exchange rates, discount unwind, derecognising assets as a result of modifications and adjustments in respect of

purchased or originated credit-impaired financial assets (POCI). Where a POCI asset’s expected credit loss is less than its expected credit loss on purchase or origination, the increase in

its carrying value is recognised within gross loans, rather than as a negative impairment allowance.

2Includes a credit for methodology and model changes of £24 million, split by stage as £20 million credit for Stage 1, £2 million charge for Stage 2, £15 million charge for Stage 3 and

£21 million credit for POCI.

3Relates to the securitisations of primarily legacy Retail mortgages

4Allowance for expected credit losses on loans and advances to customers as a percentage of gross loans and advances to customers.

Schedule of Concentration of Exposure

At 31 December 2025 the most significant concentrations of exposure were in mortgages.

	2025 £m	2024 £m
Agriculture, forestry and fishing	6,071	6,424
Construction1	3,175	3,389
Energy and water supply	5,571	4,912
Financial, business and other services	40,221	38,034
Manufacturing	5,326	4,790
Mining and Quarrying	314	205
Personal:
Mortgages1	346,033	330,840
Lease financing2	13,972	13,249
Other	31,145	28,016
Postal and telecommunications	3,177	3,182
Property companies	19,139	19,271
Transport, distribution and hotels	10,330	10,736
Total loans and advances to customers before allowance for impairment losses	484,474	463,048
Allowance for impairment losses (note 21 to the consolidated financial statements, page 272)	(3,011)	(3,191)
Total loans and advances to customers	481,463	459,857

1Includes both UK and overseas mortgage balances.

2Lease financing, previously reported in aggregate, is presented separately according to whether the lending is personal or non-personal. Non-personal lease financing is allocated to the

industries or sectors relevant to the exposure. Comparatives are represented on a consistent basis.

Schedule of Credit Quality of Assets

Retail			Commercial
Quality classification	IFRS 9 PD range		Quality classification	IFRS 9 PD range
RMS 1–3	0.00–0.80%		CMS 1–5	0.000–0.100%
RMS 4–6	0.81–4.50%		CMS 6–10	0.101–0.500%
RMS 7–9	4.51–14.00%		CMS 11–14	0.501–3.000%
RMS 10	14.01–20.00%		CMS 15–18	3.001–20.000%
RMS 11–13	20.01–99.99%		CMS 19	20.001–99.999%
RMS 14	100.00%		CMS 20–23	100.000%

	Drawn exposures										Allowance for expected credit losses
Gross drawn exposures and expected credit loss allowance (audited)	Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m		Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m
At 31 December 2025
Retail – UK mortgages
RMS 1–3	276,020		19,717		–		–		295,737		43		99		–		–		142
RMS 4–6	8,034		6,274		–		–		14,308		6		34		–		–		40
RMS 7–9	154		1,193		–		–		1,347		1		12		–		–		13
RMS 10	23		338		–		–		361		–		5		–		–		5
RMS 11–13	76		2,892		–		–		2,968		1		57		–		–		58
RMS 14	–		–		4,016		5,076		9,092		–		–		309		159		468
	284,307		30,414		4,016		5,076		323,813		51		207		309		159		726
Retail – credit cards
RMS 1–3	5,708		6		–		–		5,714		11		–		–		–		11
RMS 4–6	8,221		1,108		–		–		9,329		85		44		–		–		129
RMS 7–9	1,321		793		–		–		2,114		48		87		–		–		135
RMS 10	8		140		–		–		148		1		26		–		–		27
RMS 11–13	–		279		–		–		279		–		91		–		–		91
RMS 14	–		–		274		–		274		–		–		121		–		121
	15,258		2,326		274		–		17,858		145		248		121		–		514
Retail – UK unsecured loans and overdrafts
RMS 1–3	1,376		2		–		–		1,378		4		–		–		–		4
RMS 4–6	8,130		624		–		–		8,754		106		34		–		–		140
RMS 7–9	1,062		324		–		–		1,386		37		33		–		–		70
RMS 10	26		110		–		–		136		2		19		–		–		21
RMS 11–13	7		337		–		–		344		1		99		–		–		100
RMS 14	–		–		193		–		193		–		–		112		–		112
	10,601		1,397		193		–		12,191		150		185		112		–		447
Retail – UK Motor Finance
RMS 1–3	8,531		910		–		–		9,441		135		22		–		–		157
RMS 4–6	5,083		1,275		–		–		6,358		63		52		–		–		115
RMS 7–9	606		359		–		–		965		3		25		–		–		28
RMS 10	–		77		–		–		77		–		10		–		–		10
RMS 11–13	2		165		–		–		167		–		39		–		–		39
RMS 14	–		–		141		–		141		–		–		79		–		79
	14,222		2,786		141		–		17,149		201		148		79		–		428
Retail – other
RMS 1–3	18,554		3		–		–		18,557		7		–		–		–		7
RMS 4–6	2,616		213		–		–		2,829		10		7		–		–		17
RMS 7–9	75		86		–		–		161		–		1		–		–		1
RMS 10	–		57		–		–		57		–		1		–		–		1
RMS 11–13	–		33		–		–		33		–		1		–		–		1
RMS 14	–		–		145		–		145		–		–		35		–		35
	21,245		392		145		–		21,782		17		10		35		–		62
Total Retail	345,633		37,315		4,769		5,076		392,793		564		798		656		159		2,177
Commercial Banking
CMS 1–5	31,945		123		–		–		32,068		6		–		–		–		6
CMS 6–10	17,918		40		–		–		17,958		18		–		–		–		18
CMS 11–14	31,833		2,007		–		–		33,840		110		41		–		–		151
CMS 15–18	2,324		2,486		–		–		4,810		39		144		–		–		183
CMS 19	–		708		–		–		708		–		94		–		–		94
CMS 20–23	–		–		1,757		–		1,757		–		–		382		–		382
	84,020		5,364		1,757		–		91,141		173		279		382		–		834
Other1	540		–		–		–		540		–		–		–		–		–
Total loans and advances to customers	430,193		42,679		6,526		5,076		484,474		737		1,077		1,038		159		3,011

1Drawn exposures include centralised fair value hedge accounting adjustments.

	Drawn exposures										Allowance for expected credit losses
Gross drawn exposures and expected credit loss allowance (audited)	Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m		Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m
At 31 December 2024
Retail – UK mortgages
RMS 1–3	261,101		21,213		–		–		282,314		46		143		–		–		189
RMS 4–6	8,487		7,384		–		–		15,871		6		51		–		–		57
RMS 7–9	112		1,296		–		–		1,408		–		15		–		–		15
RMS 10	17		273		–		–		290		–		5		–		–		5
RMS 11–13	43		2,829		–		–		2,872		1		59		–		–		60
RMS 14	–		–		4,166		6,207		10,373		–		–		335		187		522
	269,760		32,995		4,166		6,207		313,128		53		273		335		187		848
Retail – credit cards
RMS 1–3	5,058		10		–		–		5,068		11		1		–		–		12
RMS 4–6	7,231		1,129		–		–		8,360		87		52		–		–		139
RMS 7–9	1,242		859		–		–		2,101		51		107		–		–		158
RMS 10	3		149		–		–		152		–		31		–		–		31
RMS 11–13	–		294		–		–		294		–		106		–		–		106
RMS 14	–		–		265		–		265		–		–		133		–		133
	13,534		2,441		265		–		16,240		149		297		133		–		579
Retail – UK unsecured loans and overdrafts
RMS 1–3	1,207		2		–		–		1,209		3		–		–		–		3
RMS 4–6	7,020		484		–		–		7,504		98		27		–		–		125
RMS 7–9	1,047		307		–		–		1,354		40		36		–		–		76
RMS 10	31		111		–		–		142		3		22		–		–		25
RMS 11–13	9		343		–		–		352		1		112		–		–		113
RMS 14	–		–		175		–		175		–		–		118		–		118
	9,314		1,247		175		–		10,736		145		197		118		–		460
Retail – UK Motor Finance
RMS 1–3	8,967		760		–		–		9,727		112		16		–		–		128
RMS 4–6	4,487		1,169		–		–		5,656		55		40		–		–		95
RMS 7–9	440		247		–		–		687		2		17		–		–		19
RMS 10	–		46		–		–		46		–		6		–		–		6
RMS 11–13	3		176		–		–		179		–		36		–		–		36
RMS 14	–		–		124		–		124		–		–		72		–		72
	13,897		2,398		124		–		16,419		169		115		72		–		356
Retail – other
RMS 1–3	15,163		238		–		–		15,401		4		4		–		–		8
RMS 4–6	2,132		190		–		–		2,322		11		7		–		–		18
RMS 7–9	78		72		–		–		150		–		3		–		–		3
RMS 10	–		7		–		–		7		–		–		–		–		–
RMS 11–13	–		9		–		–		9		–		–		–		–		–
RMS 14	–		–		147		–		147		–		–		37		–		37
	17,373		516		147		–		18,036		15		14		37		–		66
Total Retail	323,878		39,597		4,877		6,207		374,559		531		896		695		187		2,309
Commercial Banking
CMS 1–5	26,925		6		–		–		26,931		3		–		–		–		3
CMS 6–10	17,126		56		–		–		17,182		13		–		–		–		13
CMS 11–14	32,424		1,128		–		–		33,552		122		21		–		–		143
CMS 15–18	5,002		3,253		–		–		8,255		67		166		–		–		233
CMS 19	–		725		–		–		725		–		77		–		–		77
CMS 20–23	–		–		1,839		–		1,839		–		–		413		–		413
	81,477		5,168		1,839		–		88,484		205		264		413		–		882
Other1	5		–		–		–		5		–		–		–		–		–
Total loans and advances to customers	405,360		44,765		6,716		6,207		463,048		736		1,160		1,108		187		3,191

1Drawn exposures include centralised fair value hedge accounting adjustments.

Schedule of Retail Mortgages

Retail UK mortgage balance movements (audited)

	Gross carrying amount										Allowance for expected credit losses
	Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m		Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m
Retail – UK mortgages
At 1 January 2025	269,760		32,995		4,166		6,207		313,128		53		273		335		187		848
Exchange and other adjustments1	–		–		–		7		7		(1)		(1)		36		45		79
Transfers to Stage 1	3,892		(3,850)		(42)				–		29		(27)		(2)				–
Transfers to Stage 2	(5,474)		6,053		(579)				–		(2)		25		(23)				–
Transfers to Stage 3	(399)		(999)		1,398				–		–		(19)		19				–
Net change in ECL due to transfers											(29)		27		60				58
Impact of transfers between stages2	(1,981)		1,204		777				–		(2)		6		54				58
Other changes in credit quality2											(6)		(33)		89		11		61
Additions and repayments	16,528		(3,785)		(794)		(1,129)		10,820		7		(38)		(72)		(75)		(178)
Charge (credit) to the income statement											(1)		(65)		71		(64)		(59)
Advances written off					(139)		(9)		(148)						(139)		(9)		(148)
Recoveries of amounts previously written off					6		–		6						6		–		6
At 31 December 2025	284,307		30,414		4,016		5,076		323,813		51		207		309		159		726
Allowance for expected credit losses	(51)		(207)		(309)		(159)		(726)
Net carrying amount	284,256		30,207		3,707		4,917		323,087
Drawn ECL coverage3 (%)	–		0.7		7.7		3.1		0.2

1Exchange and other adjustments includes the impact of movements in exchange rates, discount unwind, derecognising assets as a result of modifications and adjustments in respect of

purchased or originated credit-impaired financial assets (POCI). Where a POCI asset’s expected credit loss is less than its expected credit loss on purchase or origination, the increase in

its carrying value is recognised within gross loans, rather than as a negative impairment allowance.

2Includes a credit for methodology and model changes of £12 million, split by stage as £22 million credit for Stage 2, £6 million charge for Stage 3 and £4million charge for POCI.

3Allowance for expected credit losses on loans and advances to customers as a percentage of gross loans and advances to customers.

	Gross carrying amount										Allowance for expected credit losses
	Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m		Stage 1 £m		Stage 2 £m		Stage 3 £m		POCI £m		Total £m
Retail – UK mortgages
At 1 January 2024	256,596		38,533		4,337		7,854		307,320		161		374		357		213		1,105
Exchange and other adjustments1	–		–		–		12		12		1		–		50		53		104
Transfers to Stage 1	21,133		(21,105)		(28)				–		135		(132)		(3)				–
Transfers to Stage 2	(21,077)		21,473		(396)				–		(11)		32		(21)				–
Transfers to Stage 3	(299)		(1,341)		1,640				–		–		(39)		39				–
Net change in ECL due to transfers											(122)		114		56				48
Impact of transfers between stages2	(243)		(973)		1,216				–		2		(25)		71				48
Other changes in credit quality2											(94)		(19)		26		66		(21)
Additions and repayments	13,901		(4,143)		(956)		(910)		7,892		(16)		(48)		(79)		(72)		(215)
Charge (credit) to the income statement											(108)		(92)		18		(6)		(188)
Disposals and derecognition3	(494)		(422)		(366)		(694)		(1,976)		(1)		(9)		(25)		(18)		(53)
Advances written off					(70)		(55)		(125)						(70)		(55)		(125)
Recoveries of amounts previously written off					5		–		5						5		–		5
At 31 December 2024	269,760		32,995		4,166		6,207		313,128		53		273		335		187		848
Allowance for expected credit losses	(53)		(273)		(335)		(187)		(848)
Net carrying amount	269,707		32,722		3,831		6,020		312,280
Drawn ECL coverage4 (%)	–		0.8		8.0		3.0		0.3

1Exchange and other adjustments includes the impact of movements in exchange rates, discount unwind, derecognising assets as a result of modifications and adjustments in respect of

purchased or originated credit-impaired financial assets (POCI). Where a POCI asset’s expected credit loss is less than its expected credit loss on purchase or origination, the increase in

its carrying value is recognised within gross loans, rather than as a negative impairment allowance.

2Includes a charge for methodology and model changes of £7 million, split by stage as £1 million charge for Stage 1, £9 million charge for Stage 2, £18 million charge for Stage 3 and

£21 million credit for POCI.

3Relates to the securitisations of primarily legacy Retail mortgages.

4Allowance for expected credit losses on loans and advances to customers as a percentage of gross loans and advances to customers.

Schedule of Mortgage Lending

	At 31 December 2025						At 31 December 2024
	Stage 1 (£m)	Stage 2 (£m)	Stage 3 (£m)	POCI (£m)	Total (£m)		Stage 1 (£m)	Stage 2 (£m)	Stage 3 (£m)	POCI (£m)	Total (£m)
Gross drawn exposures
Less than 60%	142,960	25,099	2,811	4,343	175,213		145,055	27,851	3,014	5,066	180,986
60% to 70%	48,852	2,647	620	451	52,570		49,746	2,954	643	638	53,981
70% to 80%	47,327	1,324	321	158	49,130		40,292	1,168	307	232	41,999
80% to 90%	38,070	1,181	165	62	39,478		30,215	898	123	109	31,345
90% to 100%	7,053	156	46	22	7,277		4,420	109	36	63	4,628
Greater than 100%	45	7	53	40	145		32	15	43	99	189
Total	284,307	30,414	4,016	5,076	323,813		269,760	32,995	4,166	6,207	313,128
Allowance for expected credit losses
Less than 60%	11	128	105	62	306		14	165	130	66	375
60% to 70%	10	36	69	34	149		11	51	77	36	175
70% to 80%	15	20	56	23	114		13	30	59	27	129
80% to 90%	16	19	37	15	87		13	23	32	17	85
90% to 100%	3	4	14	6	27		2	3	13	10	28
Greater than 100%	–	1	28	19	48		–	1	24	31	56
Total	55	208	309	159	731		53	273	335	187	848

UK mortgages energy performance certificate analysis

The energy performance certificate (EPC) profile of the security associated with the Group’s UK mortgage portfolio is shown below:

EPC profile	A £m	B £m	C £m	D £m	E £m	F £m	G £m	Unrated properties £m	Total
At 31 December 2025	2,087	47,170	77,625	102,066	32,690	6,124	1,361	54,690	323,813
At 31 December 2024	1,113	40,469	68,128	97,392	33,021	6,293	1,370	65,342	313,128

Schedule of Retail Credit Cards

	Gross carrying amount								Allowance for expected credit losses
	Stage 1 £m		Stage 2 £m		Stage 3 £m		Total £m		Stage 1 £m		Stage 2 £m		Stage 3 £m		Total £m
Retail – credit cards
At 1 January 2025	13,534		2,441		265		16,240		149		297		133		579
Exchange and other adjustments	–		–		–		–		–		–		(19)		(19)
Transfers to Stage 1	956		(953)		(3)		–		92		(91)		(1)		–
Transfers to Stage 2	(657)		694		(37)		–		(10)		27		(17)		–
Transfers to Stage 3	(206)		(227)		433		–		(5)		(55)		60		–
Net change in ECL due to transfers									(52)		77		78		103
Impact of transfers between stages1	93		(486)		393		–		25		(42)		120		103
Other changes in credit quality1									(24)		(14)		272		234
Additions and repayments	1,631		371		(11)		1,991		(5)		7		(12)		(10)
Charge to the income statement									(4)		(49)		380		327
Advances written off					(496)		(496)						(496)		(496)
Recoveries of amounts previously written off					123		123						123		123
At 31 December 2025	15,258		2,326		274		17,858		145		248		121		514
Allowance for expected credit losses	(145)		(248)		(121)		(514)
Net carrying amount	15,113		2,078		153		17,344
Drawn ECL coverage2 (%)	1.0		10.7		44.2		2.9

1Includes a credit for methodology and model changes of £53 million, split by stage as £18 million credit for Stage 1, £18 million credit for Stage 2 and £17 million credit for Stage 3.

2Allowance for expected credit losses on loans and advances to customers as a percentage of gross loans and advances to customers.

	Gross carrying amount								Allowance for expected credit losses
	Stage 1 £m		Stage 2 £m		Stage 3 £m		Total £m		Stage 1 £m		Stage 2 £m		Stage 3 £m		Total £m
Retail – credit cards
At 1 January 2024	12,625		2,908		284		15,817		168		401		130		699
Exchange and other adjustments	–		–		–		–		–		–		(18)		(18)
Transfers to Stage 1	1,162		(1,162)		–		–		128		(128)		–		–
Transfers to Stage 2	(642)		683		(41)		–		(13)		31		(18)		–
Transfers to Stage 3	(184)		(241)		425		–		(5)		(65)		70		–
Net changes in ECL due to transfers									(71)		84		84		97
Impact of transfers between stages	336		(720)		384		–		39		(78)		136		97
Other changes in credit quality									(31)		(22)		284		231
Additions and repayments	573		253		(15)		811		(27)		(4)		(11)		(42)
Charge to the income statement									(19)		(104)		409		286
Advances written off					(506)		(506)						(506)		(506)
Recoveries of amounts previously written off					118		118						118		118
At 31 December 2024	13,534		2,441		265		16,240		149		297		133		579
Allowance for expected credit losses	(149)		(297)		(133)		(579)
Net carrying amount	13,385		2,144		132		15,661
Drawn ECL coverage1 (%)	1.1		12.2		50.2		3.6

1Allowance for expected credit losses on loans and advances to customers as a percentage of gross loans and advances to customers.

Schedule of Commercial Banking Lending

Commercial Banking balance movements (audited)

	Gross carrying amount								Allowance for expected credit losses
	Stage 1 £m		Stage 2 £m		Stage 3 £m		Total £m		Stage 1 £m		Stage 2 £m		Stage 3 £m		Total £m
Commercial Banking
At 1 January 2025	81,477		5,168		1,839		88,484		205		264		413		882
Exchange and other adjustments	(543)		(38)		–		(581)		(13)		(2)		6		(9)
Transfers to Stage 1	1,439		(1,353)		(86)		–		62		(53)		(9)		–
Transfers to Stage 2	(2,502)		2,633		(131)		–		(12)		12		–		–
Transfers to Stage 3	(485)		(277)		762		–		(5)		(18)		23		–
Net change in ECL due to transfers									(45)		80		108		143
Impact of transfers between stages1	(1,548)		1,003		545		–		–		21		122		143
Other changes in credit quality1									(15)		(9)		45		21
Additions and repayments	4,634		(769)		(475)		3,390		(4)		5		(52)		(51)
Charge to the income statement									(19)		17		115		113
Advances written off					(153)		(153)						(153)		(153)
Recoveries of amounts previously written off					1		1						1		1
At 31 December 2025	84,020		5,364		1,757		91,141		173		279		382		834
Allowance for expected credit losses	(173)		(279)		(382)		(834)
Net carrying amount	83,847		5,085		1,375		90,307
Drawn ECL coverage2 (%)	0.2		5.2		21.7		0.9

1Includes a credit for methodology and model changes of £19 million, split by stage as £18 million credit for Stage 1, £23 million charge for Stage 2 and £24 million credit for Stage 3.

2Allowance for expected credit losses on loans and advances to customers as a percentage of gross loans and advances to customers.

	Gross carrying amount								Allowance for expected credit losses
	Stage 1 £m		Stage 2 £m		Stage 3 £m		Total £m		Stage 1 £m		Stage 2 £m		Stage 3 £m		Total £m
Commercial Banking
At 1 January 2024	79,574		7,987		2,068		89,629		232		372		418		1,022
Exchange and other adjustments	(103)		(5)		(64)		(172)		(13)		(5)		1		(17)
Transfers to Stage 1	2,361		(2,347)		(14)		–		86		(85)		(1)		–
Transfers to Stage 2	(1,850)		1,951		(101)		–		(12)		13		(1)		–
Transfers to Stage 3	(301)		(258)		559		–		(4)		(19)		23		–
Net changes in ECL due to transfers									(63)		70		62		69
Impact of transfers between stages1	210		(654)		444		–		7		(21)		83		69
Other changes in credit quality1									(11)		(20)		152		121
Additions and repayments	1,796		(2,160)		(449)		(813)		(10)		(62)		(81)		(153)
Charge to the income statement									(14)		(103)		154		37
Advances written off					(163)		(163)						(163)		(163)
Recoveries of amounts previously written off					3		3						3		3
At 31 December 2024	81,477		5,168		1,839		88,484		205		264		413		882
Allowance for expected credit losses	(205)		(264)		(413)		(882)
Net carrying amount	81,272		4,904		1,426		87,602
Drawn ECL coverage2 (%)	0.3		5.1		22.5		1.0

1Includes a credit for methodology and model changes of £25 million, split by stage as £17 million credit for Stage 1, £8 million credit for Stage 2, £nil for Stage 3.

2Allowance for expected credit losses on loans and advances to customers as a percentage of gross loans and advances to customers.

Schedule of information about credit exposures designated as measured at fair value through profit or loss

	2025						2024
	Investment grade1 £m		Other £m		Total £m		Investment grade1 £m		Other £m		Total £m
Other financial assets mandatorily at fair value through profit or loss:
Debt securities:
Government securities	16,593		–		16,593		7,093		–		7,093
Other public sector securities	1,898		7		1,905		2,286		2		2,288
Bank and building society certificates of deposit	7,036		–		7,036		8,667		–		8,667
Asset-backed securities	909		14		923		641		11		652
Corporate and other debt securities	20,476		2,934		23,410		13,984		2,899		16,883
	46,912		2,955		49,867		32,671		2,912		35,583
Treasury and other bills	11		–		11		32		–		32
Contracts held with reinsurers	8,168		–		8,168		10,527		–		10,527
Total other financial assets mandatorily held at fair value through profit or loss (excluding loans and advances and equity shares)	55,091		2,955		58,046		43,230		2,912		46,142

1Credit ratings equal to or better than ‘BBB’.

Schedule of Derivative Assets

	2025						2024
	Investment grade1 £m		Other £m		Total £m		Investment grade1 £m		Other £m		Total £m
Trading and other	18,361		1,341		19,702		22,684		1,333		24,017
Hedging	24		1		25		39		9		48
Total derivative financial instruments	18,385		1,342		19,727		22,723		1,342		24,065

1Credit ratings equal to or better than ‘BBB’.

Schedule of Securities Lending Transactions

The following on-balance sheet financial assets have been lent to counterparties under securities lending transactions:

	2025 £m	2024 £m
Financial assets at fair value through profit or loss	1,088	889
Financial assets at fair value through other comprehensive income	5,034	6,124
Total	6,122	7,013

X

- Definition

The disclosure of information about credit exposures designated as measured at fair value through profit or loss.

+ References

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+ References

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+ References

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