Tesco 2014 Annual Report Download - page 111

Download and view the complete annual report

Please find page 111 of the 2014 Tesco annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 147

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147

Note 22 Financial risk factors continued
Credit quality of loans and advances
As at 23 February 2013
Retail
unsecured
lending
£m
Retail
mortgage
lending
£m
Retail
instalment
lending
£m
Total
£m
Past due and defaulted
Less than 90 days past due 30 – – 30
90–179 days past due 42 – – 42
180 days plus past due 76 – – 76
Past due but not defaulted
0–29 days past due 41 – 1 42
30–59 days past due 11 – – 11
60–119 days past due 9 – – 9
Neither past due nor defaulted
Low risk* 4,935 258 202 5,395
High risk** 126 – – 126
Total 5,270 258 203 5,731
* Low risk is defined as an asset with a probability of default of less than 10%.
** High risk is defined as an asset with a probability of default of 10% or more.
The credit risk exposure from off balance sheet items, mainly undrawn credit card facilities and mortgage offers, was £9.7bn (2013: £8.0bn).
Insurance risk
Tesco Bank is indirectly exposed to insurance risks through its ownership of 49.9% of Tesco Underwriting Limited (‘TU’), an authorised insurance company.
Since late 2010 the majority of new business policies for home and motor insurance products sold by Tesco Bank have been underwritten by TU. The key
insurance risks within TU relate to underwriting risk and specifically the potential fora major weather event to generate significant claims on home insurance
or on motor insurance the cost of settling bodily injury claims. Exposure tothis risk is actively managed within TU with close monitoring of performance
metrics and the use of reinsurance to limit TU’s exposure above predetermined limits.
Note 23 Customer deposits and deposits by banks
2014
£m
2013
£m
Customer deposits 6,078 6,000
Deposits by banks 780 15
6,858 6,015
Included above is £1,366m (2013: £677m) non-current customer deposits and £8m (2013: £6m) non-current deposits by banks.
Deposits by banks include liabilities of £765m (2013: £5m) secured on investment securities balances which have been sold under sale and repurchase agreements.
108 Tesco PLC Annual Report and Financial Statements 2014
Notes to the Group financial statements continued