08 August 2008

Make it happen

Make it happen

Slide 2

Important Information

This presentation may contain forward looking statements, including such statements within the meaning of Section 27A of the US Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements concern or may affect future matters, such as the Group's economic results, business plans and strategies, and are based upon the current expectations of the directors. They are subject to a number of risks and uncertainties that might cause actual results and events to differ materially from the expectations expressed in or implied by such forward looking statements. Factors that could cause or contribute to differences in current expectations include, but are not limited to, regulatory developments, competitive conditions, technological developments and general economic conditions. These factors, risks and uncertainties are discussed in the Group's SEC filings. The Group assumes no responsibility to update any of the forwardlooking statements contained in this presentation.

The information, statements and opinions contained in this presentation do not constitute a public offer under any applicable legislation or an offer to sell or solicitation of an offer to buy any securities or financial instruments or any advice or recommendation with respect to such securities or other financial instruments.

The information contained in this presentation is subject to, and must be read in conjunction with, all other publicly availableinformation, including, where relevant any fuller disclosure document published by the Group. Any person at any time acquiring the securities must do so only on the basis of such person’s own judgement as to the merits of the suitability of the securities for its purposes and only on such information as is contained in public information having taken all such professional or other advice as it considers necessary or appropriate in the circumstances and not in reliance on the information contained herein. The information is not tailored for any particular investor and does not constitute individual investment advice.

Information in this presentation relating to the price at which investments have been bought or sold in the pastor the yield on investments cannot be relied upon as a guide to future performance.

08 August 2008

Make it happen

2008 Interim Results8 August 2008

08 August 2008

Make it happen

Sir Tom McKillopChairman

Slide 5

2008 Interim Results

1H07 1H08

Group profit/(loss) before tax (£m) 5,115 (691)

Underlying operating profit (£m) 5,322 5,144

Basic earnings per share (pence) 22.8 (4.7)

Adjusted earnings per share (pence) 23.6 21.3

Slide 6

Dividend

• Capitalisation issue in place of interim dividend

• 1 new share for every 40 held, in line with last year’s interim dividend

• Intention to pay final dividend in cash

08 August 2008

Make it happen

Guy WhittakerGroup Finance Director

Slide 8

2008 Interim Results

£m %

Total income 16,835 -1

Pre-impairment profit 6,623 +6

Operating profit 5,144 -3

Credit market w/downs (5,925)

Other items 90

Loss before tax (691)

Key Messages

• Costs reduced £118m

• Insurance claims down £488m

• Impairments up £543m

• Write-downs in line

• Core Tier 1 5.7%

• Tier 1 8.6%

Slide 9

Credit Market Write-downs

£bn Net Current Net Avg W/downs W/downsExposure Price June 08(1) April est(1)

ABS CDOs 2.0 40% (1.9) (1.9)US Residential 1.9 59% (1.0) (1.2)US Commercial 1.5 87% (0.1) (0.2)Monoline Exposures 2.4 n/a (2.1) (1.8)Leveraged Loans 10.8 92% (0.9) (1.3)CLOs 1.1 84% (0.1) (0.1)Sub-total (6.1) (6.4)Hedges 0.2 0.5

Total (5.9) (5.9)(1) Write-downs before tax

In line with April estimates …

Slide 10

1.5

2.3

1.0

2.5

0.21.2

GrossExposure

Net Exposure

6.3

2.4

£bn

Monoline Exposures by Rating

Ratings as at 30 June and based on lower of S&P/Moody’s

Key Messages

• Net exposure £2.4bn

• Non-investment grade £0.2bn

• 62% exposure covered

• Reserves and hedges £3.9bn

• CDO/RMBS gross exposure £3.7bn

Non-investment grade

AAAA / AA

Slide 11

Reduction in Credit Market Net Exposures

0

2

4

6

8

10

ABS CDO USResidentialMortgages

USCommercialMortgages

MonolineInsurers

SIVs FundedLeveraged

Finance

UnfundedLeveraged

Finance

CLOs

Dec 2007Jun 2008

£bn

3.8

2.0

4.3

1.92.5 2.4

1.8

8.7

5.4

1.5 1.41.1

5.85.4

Slide 12

Divisional Operating Profit

£m %

Global Markets– Global Banking & Markets 2,184 -17– Global Transaction Services 665 +15Regional Markets– UK Retail & Commercial Banking 2,117 +8– US Retail & Commercial Banking 368 -42– EME Retail & Commercial Banking 250 +13– Asia Retail & Commercial Banking 16 –RBS Insurance 403 +56Central costs (859) -9

Group 5,144 -3

Slide 13

Global Banking & Markets

£m %

Total income* 5,306 -10Direct expenses 2,607 -14Impairment losses 294 n/aContribution 2,405 -15Group Manufacturing 221 +5Operating profit 2,184 -17

£bn

Total third party assets 762.8 -7Customer deposits 96.5 +16RWAs** 211.9 -1

Key Messages

• Rates, Currencies & Commodities +87%

• Impairments up £178m on 2H07

• Credit markets weak

• De-risking balance sheet

• Assets down £108bn on Dec 07

• Ex-Sempra RWAs down 10%

* Income before credit market write-downs and one-off items** RWAs vs. 1st January 2008 (Basel II) – applies to all divisions

Slide 14

Global Transaction Services

£m %

Total income 1,173 +12Direct expenses 276 +11Impairment losses 11 +38Contribution 886 +12Group Manufacturing 221 +5Operating profit 665 +15

£bn

Loans & advances 17.1 +15Customer deposits 58.9 +10RWAs 17.1 +10

Key Messages

• Average customer deposits +13%

• International Cash Management +21%

• International Merchant Acquiring +14%

• Trade Finance +60%

• Investment for growth

Slide 15

UK Retail & Commercial Banking

£m %

Total income 5,452 +5Direct expenses 1,537 +5Impairment losses 694 -2Contribution 3,221 +7Group Manufacturing 1,104 +5Operating profit 2,117 +8

£bn

Loans & advances 233.6 +12Customer deposits 191.8 +7RWAs 159.4 +4

Key Messages

• Retail impairments fell £50m

• Corporate impairments rose £34m

• Retail Banking profits +9%

• Corporate Banking profits +6%

• Wealth Management profits +14%

• Average deposits +10%

Slide 16

US Retail & Commercial Banking

$m %

Total income 2,746 +2Direct expenses 980 +1Impairment losses– Core 388 +311– SBO 324 +372Contribution 1,054 -32Group Manufacturing 328 +5Operating profit 726 -41

$bnLoans & advances 113.7 +2Customer deposits 104.8 +5RWAs 110.2 +2

Key Messages

• Retail growth subdued

• Good Commercial growth

• Strong expense control

• Core impairment charge 73bps

• Core impairments up $129m on 2H07

• SBO impairment charge 841bps

Slide 17

Total Portfolio $114bn Cumulative LTV DistributionResidential Mortgage & Core Home Equity

US Retail & Commercial Portfolio

• Average LTV 64%• Average FICO 748

Corporate & Industrial

25%

SBO 7%

CRE* 9%

Residential Mortgage 16%

Other Consumer

19%

0

20

40

60

80

100

>60% >70% >80% >85% >90% >95%

% of Book

LTV

70%

11%

29%

4%6%

54%

Core Home Equity 24%

* Commercial Real Estate

Slide 18

US SBO Portfolio

• Book in managed run-off

• Cumulative provisions $675m

• Cumulative charge-offs $262m

• Current provisions $413m

• Reserve 2.7x NPL

• FICO 721

0.0

0.5

1.0

1.5

2.0

2.5

Jun 07 Dec 07 Jun 087

8

9

10% $bn

SBO delinquencies as % of total outstanding loans

SBO total outstanding loans

Slide 19

EME Retail & Commercial Banking

£m %

Total income 805 +19Direct expenses 293 +27Impairment losses 96 +43Contribution 416 +9Group Manufacturing 166 +5Operating profit 250 +13

£bn

Loans & advances 51.5 +9Customer deposits 23.4 +1RWAs 29.9 -1

Key Messages

• Benefit from strong euro

• Ulster investment complete

• Impairments +£27m v 2H07

• New business margins rising

• Middle East income +38%

Balance sheet growth rates at constant FX

Slide 20

Asia Retail & Commercial Banking

£m %

Total income 391 +24Direct expenses 204 +30Impairment losses 61 -Contribution 126 +30Group Manufacturing 110 +5Operating profit 16 n/a

£bn

Loans & advances 4.6 +21Customer deposits 12.7 +34Spot AUMs 19.9 +16RWAs 5.3 +8

Key Messages

• Consumer Finance +28%

• Affluent Banking +24%

• Business Banking +44%

• Private Banking +18%

• Investing for growth

Slide 21

RBS Insurance

£m %

Total income 2,786 -2

Direct expenses 410 +17

Net claims 1,863 -13

Contribution 513 +41

Group Manufacturing 110 +5

Operating profit 403 +56

Key Messages

• Own brand income +3%

• Partnership income down 8%

• Partnership contribution +18%

• Underlying claims down 6%

• Underlying profit up 5%

Slide 22

Group Manufacturing

£m %

Group Technology 676 +2

Group Property 813 +10

Customer Support 719 +2

Total costs 2,208 +5

Key Messages

• Productivity gains

• Continuing investment

• +2% at constant FX

Group cost:income ratio 48.2%

Slide 23

Net Interest Margin

UK US EME Asia

%

490

3.453.31

2.71 2.732.25 2.15

5.205.93

Retail & Commercial Banking Margins

Key Messages

• UKR&C mix effect

• Front books margin rising

• Lag effect on back books

• Strong money markets income

• Underlying Group NIM stable

1H071H08

Slide 24

Credit Quality

FY07 1H08

Loans & Advances to Customers £563.7bn £609.1bn

NPL + PPL £8.4bn £9.0bn

NPL + PPL % of Loans & Advances 1.49% 1.47%

Annualised Impairment Charge % of L&A 0.37% 0.46%

Provision coverage of NPL + PPL 59% 56%

Gross loans and advances to customers excluding reverse repurchase agreements and stock borrowingImpairment charge calculation excludes impairments from available-for-sale securities

Slide 25

Capital

Proportional Basis Jun 08

RWAs (£bn – Basel II) 491.7

Core Tier 1 (%) 5.7

Tier 1 capital (%) 8.6

Total capital (%) 13.1

Key Messages

• £12bn rights issue

• Rebased capital targets

• Well ahead at mid year

• De-risking balance sheet

• On track for year end CT1 >6%

• 1H08 consolidated CT1 6.7%

• 1H08 consolidated T1 9.1%

08 August 2008

Make it happen

Sir Fred GoodwinGroup Chief Executive

Slide 27

Agenda

• ABN AMRO separation and integration

• Capital

• Outlook

08 August 2008

Make it happen

ABN AMRO Separation and Integration

Slide 29

Separation

Slide 14UK002CPP 06/08/2008 10:53

Orderly Business Reorganisation (continued)

ABN AMRO

BU North America ex LaSalleBU AsiaBU Europe ex Antonveneta

LaSalle

Antonveneta BancoReal

PrivateClients

Asset Management

BU Netherlands

Slide 30

Separation

Consideration Transferred to ultimateowner

RBS

LaSalle

Santander

Shared Assets

Fortis

€70bn

Slide 31

Separation

Consideration Transferred to UltimateOwner

Current Position

RBS

LaSalle

Santander

Shared Assets

LaSalle

Asset Management

BancaAntonveneta

Banco RealBrazil

BU NetherlandsTransfer: 2H09Private ClientsTransfer: 1H09

RBS

Shared Assets

Shared Assets

Fortis

€70bn

€34bn

GC Brazil

€36bn

€14bn

€20bn

Slide 32

Separation

Shared Assets TransferStatus

• UniCredit stake

• Taitung

• Prime Bank

• BU Private Equity 75% complete

• Saudi Hollandi stake ongoing

Slide 33

Integration Synergies

P&L Impact in 2010 Offer Doc Revised PlanJuly 07 Feb 08

€mCost savings 1,319 1,600Net revenue benefits 395 700

£mCost savings 1,150Net revenue benefits 500

• 2010 benefits equate to c.4x RBS-acquired businesses 2007 underlying profit before tax

Slide 34

Cost SavingsImpact on Profit Before Tax

13575

300

900

1,150

0

200

400

600

800

1,000

1,200£m

ActualTarget

Jun 08 Dec 08 Dec 09 Dec 10

Slide 35

Net Revenue BenefitsImpact on Profit Before Tax

57 30120

280

500

0

200

400

600

800

1,000

1,200£m

Jun 08 Dec 08 Dec 09 Dec 10ActualTarget

Slide 36

Integration Progress

• New Group organisational structure implemented

• Senior leadership teams appointed

• Re-branding implemented in 19 countries

• Scaling of GBM IT systems to enable migration completed

• Data centre consolidation underway

• Delivery of synergies ahead of plan– Accelerated headcount reduction in GBM; 2,245 at 1H08 – Accelerated ramp down of ABN AMRO Head Office functions– Increased and accelerated purchasing savings

Slide 37

Performance

StrategicRationale

• Wholesale businesses– Global client franchises– Complementary product strengths

• Rates, Currencies, Commodities• Equities• Credit Markets

• Global Transaction Services• International Retail Businesses• Global manufacturing capability

CurrentTrading

–x

08 August 2008

Make it happen

Capital

Slide 39

Capital

Capital Ratios

Target Actual Target30 Jun 08 30 Jun 08 31 Dec 08

Core Tier 1 >5.0% 5.7% >6.0%

Tier 1 >7.5% 8.6% >8.0%

Capital ratios on a proportionately consolidated basis

€14bn

Slide 40

Disposals

• Disposal plans on track

• Target £4 billion contribution to capital

• 25% of target contracted to date, including

– Angel Trains

– ECF

– TPF

Completed

Expected to complete 2H08

Slide 41

De-Leveraging

GBM Third Party Assets*

• Reduction of £108bn in third party assets in the first half, £157bn since March

• Focus on improving risk/return profile, whilst continuing to support customer relationships

• Programme continues in 2H08

400

600

800

1,000

Dec07

Jan08

Feb08

Mar08

Apr08

May08

Jun08

£bn

* Third party assets excludes derivatives

08 August 2008

Make it happen

Outlook

Slide 43

Outlook

Consensus GDP Growth Forecasts for 2008

Jan 07 Jul 07 Feb 08 Jul 08

UK 2.4% 2.2% 1.7% 1.5%

US 3.0% 2.8% 1.6% 1.5%

Eurozone 2.1% 2.3% 1.6% 1.6%

Asia-Pacific 4.8% 5.0% 4.9% 4.8%

Slide 44

Strong Franchises

1H08 v 1H07GBM Interest rate swap client volumes +59%

US IG corporate bond issuance +41%GTS Merchant acquiring volumes +23%

Wholesale payments +5%UK Retail Bancassurance sales +10%

Mortgages +9%UK Wealth AUM +10%US Retail & Commercial Commercial lending +13%

Deposits +5%E&ME Retail & Commercial Deposits +14%

Loans +23%Asia Retail & Commercial Personal customers +14%

Deposits +34%AUM +16%

Many Businesses Maintaining Strong Growth in Customer Volumes

Slide 45

Diversified Income Streams

• 38% of Group underlying income

• Good growth and development of client franchise

• Very strong growth across Rates, Local Markets, Currencies & Commodities, good growth in investment grade credit markets

• Loan margins widening, fee levels rising

• GTS providing solid income growth, notably in International Cash Management/Trade Finance

0 1,000 2,000 3,000

Rates, Currencies &Commodities

Equities

Credit Markets

Asset & Portfolio Mgt

Cash Management & TradeFinance

Merchant Services &Commercial Cards

Global Markets

1H071H08

£m

Slide 46

Diversified Income Streams

• 48% of Group underlying income

• Strong commercial potential across all regions

• Private banking activity remains strong

• Personal business growing despite difficult retail market conditions

• New business margins strengthening

0 1,000 2,000 3,000

Personal Deposits

Mortgages

Other Personal Lending

Business & CommercialDeposits

Business & CommercialLending

Investment Products

Other

Regional Markets

£m

1H071H08

Slide 47

Conclusion

• Good progress on ABN AMRO separation and integration

• Capital plan remains on track– Capital re-basing ahead of target at end June

• Outlook for the global economy is challenging, but RBS better positioned– Stronger capital base– Income growth from new products to enlarged customer base– Meaningful efficiency improvement from delivery of synergies

08 August 2008

Make it happen

2008 Interim Results8 August 2008

08 August 2008

Make it happen

Appendix

08 August 2008

Make it happen

Credit

Slide 51

Loans and Advances to Customers

Sector Geography

UK Domestic

46%

UK International 13%

Europe 20%

US 14%

Asia 7%

Construction 3%

Services 26%

Property 15%

Leases and Other 7%

Gross loans and advances to customers, net of reverse repos and stock borrowing

IndividualsHome20%

Finance 13%

Individuals Other 8%

Manufacturing 8%

Total Loans and Advances to Customers £609bn

Slide 52

UK Portfolio

UK Domestic Loans and Advances £282bn

Individuals Home 28%

Manufacturing 5%Construction 4%

Services 21%

Property 18%

Leases and Other 9% Finance 6%

Individuals Other 10%

Gross loans and advances to customers, net of reverse repos and stock borrowing

Slide 53

Commercial Property

Commercial Property Portfolio £91bn UK Commercial Property £51bnDiversified by Geography Core Portfolio LTV Distribution

UK 55%

RoI 10%

Germany 7%

Spain 4%

Other Western Europe

14%

North America

9%

Rest of World 1%

• Average LTV 68%• 1% speculative• Well diversified by sector• Characteristics typical of overall portfolio

0

20

40

60

80

100

>50% >60% >70% >75% >80% >85%

% of Book

LTV

87%

69%

45%

19%8% 3%

Slide 54

UK Retail Mortgages

• Average LTV 49%• Buy-to-let LTV 56%• New business LTV 66%

Total Portfolio £72bn Cumulative LTV Distribution

0

20

40

60

80

100

>60% >70% >80% >85% >90% >95%

% of Book

35%

6%10%3%

24%

Other Mortgages 94%

Buy to Let 6%

LTV

14%

Slide 55

Total Portfolio £57bn Cumulative LTV DistributionResidential Mortgage & Core Home Equity

US Retail & Commercial portfolio

• Average LTV 64%• Average FICO 748

Corporate & Industrial

25%

SBO 7%

CRE* 9%

Residential Mortgage 16%

Other Consumer

19%

0

20

40

60

80

100

>60% >70% >80% >85% >90% >95%

% of Book

LTV

Core Home Equity 24%

70%

11%

29%

4%6%

54%

* Commercial Real Estate

Slide 56

US SBO Portfolio

• Book in managed run-off

• Cumulative provisions $675m

• Cumulative charge-offs $262m

• Current provisions $413m

• Reserve 2.7x NPL

• FICO 721

0.0

0.5

1.0

1.5

2.0

2.5

Jun 07 Dec 07 Jun 087

8

9

10% $bn

SBO delinquencies as % of total outstanding loans

SBO total outstanding loans

08 August 2008

Make it happen

Diversified Income Streams

Slide 58

Diversified Income Streams

0 500 1000 1500 2000 2500 3000

Rates

Currencies

Commodities

Equities

Credit Markets

Equity Finance

Asset & portfolio mgt

Global Banking & Markets Income by Product

£m1H071H08

Slide 59

Diversified Income Streams

0 100 200 300 400 500

Domestic cash

Int'l CashManagement

Trade Finance

Merchant Acquiring

Commercial Cards

Global Transaction Services Income by Product

1H071H08

£m

Slide 60

Diversified Income Streams

£m

UK Retail & Commercial Banking Income by Product

0 500 1,000 1,500

Personal advances excl mortgagesMortgages

Personal depositsBancassurance

Business advancesBusiness deposits

Other retailWealth management

Commercial + corporate lendingAsset finance

Invoice financeCorporate deposits

1H071H08

Slide 61

Diversified Income Streams

0 300 600 900 1,200 1,500

Personal lending

Credit and debit cards

Mortgages and home equity

Retail deposits

Investment products

Commercial lending

Commercial deposits

US Retail & Commercial Banking Income by Product

1H071H08

$m

Slide 62

Diversified Income Streams

Europe & Middle East (E&ME) Retail & Commercial Banking Income by Product

£m0 50 100 150 200 250 300 350 400

Personal advancesexcl mortgages

Mortgages

Personal deposits

Business advances

Business deposits

Capital Markets andother income

1H071H08

Slide 63

Diversified Income Streams

0 50 100 150 200 250

Private Banking

Cards and ConsumerFinance

Affluent Banking (andgeneral)

Business Banking

Asia Retail & Commercial Banking Income by Business Line

£m1H071H08

08 August 2008

Make it happen

2008 Interim Results8 August 2008