AGM Statement

Royal Bank of Scotland Group PLC
20 April 2005


The Royal Bank of Scotland Group plc AGM Statement

20 April 2005

The Meeting will deal with the proposed Resolutions as outlined in the Notice of
Meeting issued to Shareholders dated 7 March 2005, and will provide a summary of
the business and financial performance of the Group in 2004.

The following is an extract from the speech to be made by Sir George Mathewson,
Chairman, at the Meeting.

'In 2004, we increased our Group operating profit, that is, our profit before
tax, goodwill amortisation and integration costs by 15 per cent to £8,101
million. And we increased our profit before tax by 14 per cent, to £6,917
million.'

'We also increased our adjusted earnings per share by 10 per cent. The Board is
recommending a final dividend of 41.2p per ordinary share, an increase of 15 per
cent over the previous years dividend. This is the twelfth consecutive year in
which we have increased our dividend per share by 15 per cent.'

'In 2004, we increased our total income by 18 per cent. Adjusting for the impact
of currency movements, our income growth was 20 per cent. Of this 20 per cent
growth in our income, acquisitions accounted for 9 per cent, organic growth 11
per cent. As a result of the relative movements in income and expenses, we
improved our cost income ratio from 42.6 per cent in 2003 to 40.8 per cent in
2004.'

'During 2004 we made several acquisitions, the largest of which was the US bank,
Charter One. Charter One is an excellent fit with our existing US business,
Citizens Financial Group. Charter One's presence in various densely populated
states has enabled a significant expansion of Citizens' existing and potential
customer base. Since acquiring Charter One on 31 August 2004, the initial
performance of the business has been good and integration is fully on track.
During the last 18 months we completed two other large acquisitions - Churchill
Insurance and First Active. In each case, as for Charter One, IT migration is
fully on track and we are delivering transaction benefits in line with our
plans.'

'Our people are the key to our success. The addition of 1,000 staff at NatWest
was among the 4,500 new jobs created by organic growth, the majority of them
customer facing. Our total number of Full Time Equivalent employees rose to
nearly 137,000, up by 16,000 from around 121,000 last year.'

'The training and development of our staff is a high priority to ensure that
they fully develop their potential and continue to deliver a very high quality
of service to our customers. Over £50 million was invested in development and
leadership programmes in 2004.'

'There has been no change to our policy not to transfer jobs offshore. This
continues to differentiate us from the vast majority of our competitors, and is
important to maintaining the commitment and loyalty of our employees.'

'We owe our people more than stable, safe and fair employment. The environment
in which they work should be fully fit for purpose in the 21st century. We have
recently completed new regional centres in Manchester and Birmingham, part of
our work to rationalise and improve our office premises.'

'At Gogarburn, the office accommodation and the associated training and social
facilities have been designed with the help of our staff who will work there.
Work is on budget and ahead of schedule and staff will transfer, this summer, to
the new building, which will provide a modern, efficient and pleasant working
environment for 3,250 people.'

'Banks sit at the heart of the community. While our products and services must
meet the needs of people and businesses, there is more that we can do to
contribute. The value of our community investment programme in 2004 was £46
million, making it one of the largest in Europe.'

'In parallel with our responsibilities to the community, we have an obligation
to minimise our impact on the environment. In 2004 we improved our position to
second equal in the Dow Jones Sustainability World Index for the banking sector,
and our score was 22 per cent above the global average for the sector. Our
policies and practice focus on the key areas of energy consumption, transport
and waste management, and we are ahead of our targets in each of these areas,
with some significant achievements in savings.'

'At previous meetings, we have mentioned our strength, diversity and
flexibility. These are real qualities, evident across the Royal Bank Group. They
give us confidence that we can continue to provide customers with improved
service, with well rewarded and highly motivated staff, while allowing us to
make a major contribution to the communities in which we operate.'

'For our shareholders, we continue to focus on the fundamentals of growing our
income and improving our efficiency, while maintaining sustainable credit
quality. And we continue to focus on having strategic options, so that we can
sustain our growth in income and earnings over the long term.'

'The Group continues to perform well, although many indicators suggest that we
are facing a period of increased consumer caution in the UK. In corporate
banking and financial markets, we continue to see good growth in the UK and in
our overseas operations. In the United States our businesses continue to perform
well and the integration of Charter One is fully on track.'

Forward Looking Statements
This announcement contains 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 future 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 the 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. The Group assumes no responsibility to update
any of the forward looking statements contained in this announcement.


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