That’s part of the reason we gave you a range for income for the full years. We — but we have kind of looked to consider that within the income guidance. And then I think the other thing. Just remember we spoke about it earlier, so I won’t repeat it all, but in terms of the structural hedge, just the differential in that level of reinvestment. We are assuming that there is reinvestment despite the hedge kind of will shrink over the year. We get to deposit stability by the middle of the year, so from the middle of the year, onwards, you would start to see fuller reinvestment, not full, because of the 12-month we buy but that helps the second half to be stronger than the first half.
Chris Cant : Just on that TNAV point, and I appreciate you don’t want to give us a profit number. When I look at consensus, the gap between consensus CET1 and TNAV in 2026 is about GBP 0.5 billion. Your gap as of the end of 2023 is GBP 1.2 billion. And from what you’re saying that gap should materially widen subject to exactly what happens with rate, but we should be expecting a much more meaningful gap between TNAV and CET1 in the outer-years than we see today, presumably.
Katie Murray: I mean I think we gave you a really good disclosure on that capital-to-TNAV reconciliation. It’s on Page 375 of the accounts. You might not have got there yet this morning. And what I always find, if you look at it over a few years, you can see which numbers present a little bit of volatility within that number. So I’m not going to be precise on the gap at the moment, but I think you’ve got the component parts within there. And that reconciliation over a multiyear basis does give you some helpful views into the evolution of TNAV.
Paul Thwaite : We look forward to discussing Page 375 with you.
Operator: Our next question comes from Robin Down of HSBC.
Robin Down : A couple of kind of linked questions. And actually it slightly builds on a bit of what Chris was saying there. You’ve given us this 25 basis point sensitivity, which is quite helpful on Slide 17, but I’m just conscious. Obviously, we’re looking at a series of rate cuts. I’m just wondering whether you could perhaps talk about what the impact might be of, say, a 100 basis point rate cut. I assume we don’t just kind of multiply it by 4 here. I don’t know if we can do on the structural hedge side, but it’s the managed margin side. I’m conscious you’ve got insides of savings account to pay 175. And I guess, the lower rates go the harder it is to pass-through. And the reason why I’m kind of interested in that is just thinking of the dynamic going into 2025.
I appreciate kind of volumes will hopefully pick up as interest rates fall. But if I think about the kind of structural hedge, I’m guessing we’re going to be looking at probably low to mid-30s billions of rollovers in 2025 with, say, a spot rate of 3% and a maturity rate of 50 basis points. But going the other way, if you build a string of interest rate cuts and you’re telling us 25 basis points today is GBP 125 million in year. I’m just kind of curious as to how you sink those two kind of interplay going into 2025? And when we look at consensus revenues, I think we’re up at that kind of 14.2 for ’25. Obviously, there’ll be some volume growth there that will help out, but perhaps whether comfortable with that 14.2?
Katie Murray : Look, in terms of the 100 basis points, it’s relatively linear. And I think if you go to Page 267 of the accounts, you’ll actually see that I’ve given you the 100 basis points disclosure.
Robin Down : I didn’t quite get that far. Sorry.
Katie Murray : No. It’s all right. I must — I’ve got the cheat list for where the pages that you guys will go, but you can work out through there. So that will be help for you. So I think it’s is Page 267 in terms of and I think that will kind of give you what you need on that point. And then just sorry, Robin. I’m not entirely sure of the second bit of the question that you’re actually asking me to kind of confirm, but I think if you look at Slide 15, it will help a little bit with the interplay of what’s hedged and unhedged. What we’ve given you there this morning is just to try to kind of give you a flavor of what happens in term, which is obviously the tightest. What’s unhedged? And then what’s supporting the product structural hedge?
And as you see that migration continue, you’ll see that — you’ll see those balances move a little bit more to the term hedge. And then you need to take a view whether that’s coming out of our unhedged kind of instant access or out of the current account piece, as we go through from there, as to what happens in terms of different rate cuts, but I would say we have seen it slow. We do expect it to continue but not at the speeds that we saw in the previous year.
Robin Down : I think my point was more that if we’re looking at, say, GBP 30 billion, GBP 35 billion of maturities in 2025. And I appreciate this is kind of we have to think about quarterly rates here. And you’re going at 250 basis point kind of uplift on that then we can kind of do the math on that. And how that then interplays, though, with average base rates and ‘25 being more than 100 basis points lower than where they are in 2024? I mean it’s — effectively it’s a question of almost like where you think the margin goes in ’25.
