Ann: CYBG PLC Third Quarter 2019 Trading Update, page-158

@plough

With respect, I think you are making a bit of confusion here.

The “Cost of Risk” is the aggregate Impairment Charge on Customer Loans, expressed as a percentage of Total Loans. It has nothing to do with the interest charged to customers on those loans.

By way of illustration (looking at the left-hand side of your attachment, and using figures as of March 31st 2019):

Total Customer Loans: 72,600m GBP

Net Cost of Risk: 21bps (annualised)

Gross Cost of Risk: 26bps (annualised)

Net Impairment charge: 72,600m*0.0021%*0.5 = 76m GBP (vis-a-vis 77m GBP as reported, due to rounding errors)

Gross Impairment charge: 72,600m*0.0026%*0.5 = 94m GBP

If you now look at the right-hand side of your attachment, you can add up the individual gross impairment charges for the different types of loans, and check that the total corresponds to the Gross Impairment Charge calculated above:

Mortgages: 60,500m*0.0001%*0.5 = 3m GBP

SME: 7,600m*0.0055%*0.5 = 21m GBP

Unsecured: 4,500m*0.0317%*0.5 = 71m GBP

Total: 95m GBP (vis-a-vis 94m GBP calculated above, due to rounding errors).

If you want to see the actual yield breakdown by asset type (reflective of the interest charged to customers) you have to look at slide 12 in the same presentation (see picture below):

As you can see, the average annualised yield as of March 2019 was 4.17% on SME loans and 7.65% on Unsecured loans, which is quite a bit higher than the figures you indicated.

Hope this helps, cheers.