RBS's transitional Common Equity Tier 1 ("CET1") ratio under the modelled adverse scenario was 8.2% under the EBA's published capital definitions and prescribed approach and 6.7% under the PRA definition. This was 1.2% above the post-stress minimum ratio requirement of 5.5% used in this exercise.

The equivalent ratio under the EBA modelled adverse scenario on a 'fully loaded' Basel 3 basis is also 6.7%.

The cumulative impact on operating profit, impairment in the banking book and losses in the trading book for the modelled stresses under the adverse scenario over the three years to 31 December 2016 are shown in the table below:

Outcome of the modelled adverse scenario at 31 December 2016


2013 published CET1 ratio

Transitional (EBA definition)

11.0%

Transitional (PRA definition)1 

8.6%

Fully loaded 

8.6%

EBA stress test results (EURm)
3-year cumulative operating profit before impairments 8,179 8,179 8,179
3-year cumulative stress banking book impairment (20,010) (20,010) (20,010)
3-year cumulative losses from stress in trading book (4,166) (4,166) (4,166)
          of which stress valuation losses due to sovereign shock (284) (284) (284)
EBA calculated risk-weighted assets 476,639 476,639 476,639
Resulting EBA-calculated CET1 ratio 8.2% 6.7% 6.7%

RBS continues to make good progress in improving its regulatory CET1 ratio. The ratio improved by 150 basis points to 10.1% as at 30 June 2014 from the CRR end-point basis CET1 ratio of 8.6% as at 31 December 2013. This improvement reflected actions taken to reduce legacy asset exposures coupled with a significant improvement in trading performance. RBS continues to target a CRR end-point basis CET1 ratio of around 11% at 31 December 2015 and above 12% by the end of 2016.

RBS also notes that two of its subsidiaries were subject to the European Central Bank's ("ECB") Comprehensive Assessment. Both have reported CET1 ratios above the post-stress minimum ratio requirement under the ECB-modelled adverse scenario:

• Ulster Bank Ireland Limited's ("UBIL") transitional Common Equity Tier 1 ratio under the modelled adverse scenario was 6.2%, which is based on the ECB's published capital definitions and prescribed approach.

• The Royal Bank of Scotland N.V.'s ("RBS NV") transitional Common Equity Tier 1 ratio under the modelled adverse scenario was 7.2%, which is based on the ECB's published capital definitions and prescribed approach.

RBS Group plc will announce its Q3 2014 Interim Results on Friday, 31 October 2014.

The detailed results of the capital exercise, as well as information on RBS exposures to central, regional and local governments in the EEA, are available via the links below:

• RBS: EBA stress tests

• UBIL: Comprehensive Assessment disclosure, EBA stress tests

• RBS N.V: Comprehensive Assessment disclosure, EBA stress tests

This announcement contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including those related to RBS and its subsidiaries' regulatory capital position, risk-weighted assets, impairment losses and credit exposures under certain specified scenarios. In addition, forward-looking statements may include, without limitation, statements typically containing words such as "intends", "expects", "anticipates", "targets", "plans", "estimates" and words of similar import. These statements concern or may affect future matters, such as RBS's future economic results, business plans and current strategies. Forward-looking statements are subject to a number of risks and uncertainties that might cause actual results and performance to differ materially from any expected future results or performance expressed or implied by the forward-looking statements. Factors that could cause or contribute to differences in current expectations include, but are not limited to, legislative, fiscal and regulatory developments, competitive conditions, technological developments, exchange rate fluctuations and general economic conditions. These and other factors, risks and uncertainties that may impact any forward-looking statement or RBS's  actual results are discussed in RBS's UK Annual Report and materials filed with, or furnished to, the US Securities and Exchange Commission, including, but not limited to, RBS's Reports on Form 6-K and most recent Annual Report on Form 20-F. The forward-looking statements contained in this announcement speak only as of the date of this announcement and RBS does not assume or undertake any obligation or responsibility to update any of the forward-looking statements contained in this announcement, whether as a result of new information, future events or otherwise, except to the extent legally required.

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