866-997-4948(US-Canada Toll Free)

Commercial Banking and Finance - UK - June 2015

Published By :


Published Date : Jun 2015

Category :


No. of Pages : N/A

Banks results from 2014 showed that strengthening economic conditions during the first part of the year  helped reduce impairment charges and boost profitability
Table of Content

Executive Summary

The market
Figure 1: UK MFIs sterling deposits from UK resident businesses, 2013-15
Deposits for non-financial businesses to continue upward trajectory
Figure 2: Forecast UK MFIs sterling deposits from UK resident non-financial businesses, 2015-19
Market factors
Profitability and private sector business investment growing
Figure 3: UK PNFCs net rate of return, 2010-14
New authorisation process to boost challengers
Aldermore grows in strength following flotation
RBS Group braced for further costs
What we think


Market positioning
The supplier
The customer

Key Insights

When are the significant conduct costs facing the banks likely to ease?
Will ring-fencing regulation affect services to commercial banking customers?
What is happening to margins in the commercial banking sector?
How are changes in the business population affecting the corporate banking business?
Are challenger banks a threat to providers of mid-market and corporate banking services?

UK Economy

Interest rates
Consumer spending

Market Factors

Key points
Slowdown at the start of 2015
Figure 4: GDP growth rate, 2012-15
Large corporates taking greater share of private sector turnover
Figure 5: Business population in the UK, by company size, 2013-14
Profitability and business investment rising in the private sector
Figure 6: UK PNFCs net rate of return, 2010-14
Figure 7: UK total business investment, 2010-14
Steady decline in corporate insolvencies continues
Figure 8: Corporate insolvencies in the UK, 2010-14
Reports of climbing confidence at odds with decline in M&A activity
Figure 9: Acquisitions of UK companies, 2011–14

Commercial Banking Market

Key points
The wider banking industry is under strain...
though there are some positive indicators for commercial banking
Commercial deposits climb in line with economic recovery
Figure 10: UK MFIs sterling deposits from UK resident businesses, 2013-15
Figure 11: MBBG deposits from UK private non-financial corporations, 2010-14

Commercial Banking Segmentation

Key points
Retail and real estate deposits rising
Figure 12: MFI sterling deposits of UK resident non-financial businesses, by industry type, March 2015
SME sector performing strongly in wider recovery
Figure 13: MBBG deposits of small and medium-sized businesses, 2011-14

Commercial Borrowing

Key points
Net lending to large businesses increases at start of 2015...
Figure 14: Net loans to large, non-financial businesses by UK MFIs, 2013-15
while Funding for Lending focus has shifted to small businesses
Rates remain flat while demand from the large corporate sector rises
Figure 15: Monthly average interest rate for UK MFI new advances to PNFCs, 2010-14
Figure 16: Availability of corporate credit to PNFCs in the last three months, 2010-14
Figure 17: Demand for corporate credit by PNFCs in the last three months, 2010-14

Market Trends

Key points
Product and service innovation limited but new service model on the horizon
Technology trials to benefit commercial banking customers
High take up for online business banking facilities
Figure 18: Use of business banking features in the last three months, March 2015
Impact of competition inquiry will depend on strength of regulatory will

Brand Communication and Promotion

Key points
Ad spending lull follows surge over switching and brand reputation
Figure 19: Advertising expenditure on business banking services, 2010-15
Lloyds far out in front on campaign expenditure
Figure 20: Advertising expenditure on business banking services, by advertiser, 2014-15
Press advertising dominates channel spend
Figure 21: Advertising expenditure on business banking services, by media type, 2014-15

Industry Structure

Key points
Industry development
Challengers on the rise, but no match for major groups
New authorisation process beginning to take effect
Government scaling back involvement in banking sector
Figure 22: Cost to UK government of financial interventions in banking sector, February 2015

Aldermore Bank Plc

Recent company activity
Figure 23: Financial analysis of Aldermore Bank plc, 2010-14

Barclays Plc

Recent company activity
Figure 24: Financial analysis of Barclays plc, 2010-14

Clydesdale Bank Plc

Recent company activity
Figure 25: Financial analysis of Clydesdale Bank plc, 2010-14

Co-operative Bank

Recent company activity
Figure 26: Financial analysis of Co-operative Bank plc, 2009-13


Recent company activity
Figure 27: Financial analysis of HSBC Bank, 2010-14

Lloyds Banking Group

Recent company activity
Figure 28: Financial analysis of Lloyds Banking Group, 2010-14

Royal Bank of Scotland Group

Recent company activity
Figure 29: Financial analysis of RBS Group, 2010-14

Santander UK Plc

Recent company activity
Figure 30: Financial analysis of Santander UK plc, 2010-14

Commercial Banking Forecast

Key points
Growth dependent on wider economy’s performance
Figure 31: Forecast UK MFIs sterling deposits from UK resident non-financial businesses, 2015-19
Costly ring-fencing requirements may raise fees and restrict credit
New banks are changing the operating model

Further Sources and Contacts

Trade associations
British Banking Association
Trade publications
The Banker
Euromoney Institutional Investor

Make an enquiry before buying this Report

Please fill the enquiry form below.

  • Full Name *
  • Your Email *
  • Job Title
  • Company *
  • Phone No. * (Pls. Affix Country Code)
  • Message
  • Security Code *

Upcoming Reports

  • Sugar and Gum Confectionery - UK - January 2015

    Rising dental health concerns can create an opportunity for chewing gum brands. Currently much of the marketing for sugar-free gums centres around fresh breath, however, the dental health benefits, particularly for children, could warrant more focus. Though explored internationally, tooth-friendly gums tailored for children remain rare in the UK market....