VALUE OF IN-FORCE BUSINESS (Tables)

12 Months Ended

Dec. 31, 2017

VALUE OF IN-FORCE BUSINESS (Tables) [Line Items]

Disclosure of range of yields and other key assumptions

The table below shows the resulting range of yields and other key assumptions at 31 December:

	2017	2016
	%	%
Risk-free rate (value of in-force non-annuity business)1	0.00 to 4.20	0.00 to 4.20
Risk-free rate (value of in-force annuity business)1	1.14 to 5.34	1.38 to 5.58
Risk-free rate (financial options and guarantees)1	0.00 to 4.20	0.00 to 4.20
Retail price inflation	3.43	3.50
Expense inflation	3.67	3.73

1 All risk-free rates are quoted as the range of rates implied by the relevant forward swap curve.

Disclosure of detailed information about intangible assets [text block]

					Purchased		Customer-		Capitalised
			Core deposit		credit card		related		software
	Brands		intangible		relationships		intangibles		enhancements			Total
	£m		£m		£m		£m		£m			£m
Cost:
At 1 January 2016		596		2,770		315		538		1,814			6,033
Additions		–		–		–		–		463			463
Disposals		–		–		–		–		(110	)		(110	)
At 31 December 2016		596		2,770		315		538		2,167			6,386
Acquisition of businesses (note 22)		–		–		702		–		–			702
Additions		–		–		–		–		850			850
Disposals		–		–		–		–		(77	)		(77	)
At 31 December 2017		596		2,770		1,017		538		2,940			7,861
Accumulated amortisation:
At 1 January 2016		149		2,460		309		472		805			4,195
Charge for the year		22		297		2		27		234			582
Disposals		–		–		–		–		(72	)		(72	)
At 31 December 2016		171		2,757		311		499		967			4,705
Charge for the year		22		13		44		20		293			392
Disposals		–		–		–		–		(71	)		(71	)
At 31 December 2017		193		2,770		355		519		1,189			5,026
Balance sheet amount at 31 December 2017		403		–		662		19		1,751			2,835
Balance sheet amount at 31 December 2016		425		13		4		39		1,200			1,681

In-Force [Member]

VALUE OF IN-FORCE BUSINESS (Tables) [Line Items]

Disclosure of intangible assets material to entity [text block]

The gross value of in-force business asset in the consolidated balance sheet is as follows:

	2017 £m	2016 £m
Acquired value of in-force non-participating investment contracts	306	340
Value of in-force insurance and participating investment contracts	4,533	4,702
Total value of in-force business	4,839	5,042

Non-participating investment contracts [Member]

VALUE OF IN-FORCE BUSINESS (Tables) [Line Items]

Disclosure of intangible assets material to entity [text block]

The movement in the acquired value of in-force non-participating investment contracts over the year

	2017			2016
	£m			£m
At 1 January		340			377
Amortisation taken to income statement (note 11)		(34	)		(37	)
At 31 December		306			340

In-Force Insurance and Participating Investment Contracts [Member]

VALUE OF IN-FORCE BUSINESS (Tables) [Line Items]

Disclosure of detailed information about intangible assets [text block]

The movement in the value of in-force insurance and participating investment contracts over the year

	2017			2016
	£m			£m
At 1 January		4,702			4,219
Exchange and other adjustments		(4	)		11
Movements in the year:
New business		348			428
Existing business:
Expected return		(318	)		(210	)
Experience variances		(226	)		(137	)
Assumption changes		(238	)		127
Economic variance		269			264
Movement in the value of in-force business taken to income statement (note 9)		(165	)		472
At 31 December		4,533			4,702