Explanatory Notes - Monetary financial institutions in the UK: income and expenditure vis-à-vis non-residents
OVERVIEW
AVAILABILITY
SOURCES
REVISIONS
DEFINITIONS
VALUATIONS AND BREAKS
FURTHER INFORMATION
This table contains selected income and expenditure data of Monetary and Financial Institutions (MFIs) in the UK receivable from and payable to non-residents comprising data series on commissions and fees and investment income. Investment income data are broken down into Direct income (branches’ profits and losses and ‘Other’), Portfolio income and ‘Other’ income. Net data are shown for all items except Portfolio investment and Total income.
The sign convention used is also consistent with that used by the Office for National Statistics (ONS) in their Balance of Payments accounts. This shows both amounts receivable (called ‘credits’ by the ONS) and payable (‘debits’) with a positive sign
Data are available quarterly for almost all series from 1998 Q1. The sole exception relates to net commissions and fees which starts from 1994 Q1. Publication of data will usually occur on the 21st working day of the month in Table B4.1 in Monetary and Financial Statistics (Bankstats) with the most recent quarter available in the publication for the third month after the end of the quarter.
Following the transition of building societies statistical reporting from the FSA to the Bank of England on 1st January 2008, table B4.1 includes building society data from 2008 Q1 data onwards.
Data up until end 2003 are sourced from Form BP. Data from 2004 Q1 are from the Form PL which replaced Forms A3 and BP. The data were reported by all UK-resident banks at least annually up to 2006. There is now around 98% coverage from banks reporting at least annually. Coverage from quarterly bank data is around 92% with estimates derived for the other banks.
Building society data reported on Form PL are included from 2008 Q1, with coverage similar to that for banks. Estimates are derived for other building societies.
The Bank of England is not able to collect data on the amount payable on securities issued to non-residents so these data are estimated by the ONS.
All data are subject to revision if and when new information becomes available. For more information on revisions practices see the Explanatory Note on revisions, available here.
Non-residents are defined as economic units that have a centre of economic interest outside the domestic economic territory. UK economic territory excludes the Channel Islands and the Isle of Man.
Commissions and fees: examples include commissions and fees related to foreign exchange transactions, new issues of securities, portfolio management, derivative transactions etc.
Direct investment income: A direct investment relationship is defined as where one company owns 10% or more of equity capital in another company.
Direct investment income on outward investments is calculated as the sum of:
- profits(+) or losses(-) of non-resident branches and subsidiaries of UK-owned MFIs earned over the period
- dividends received from subsidiaries
- net interest receivable on loan capital from companies where there is a direct investment relationship
Direct investment income on inward investments is similarly calculated as the sum of:
- profits(+) or losses(-) of banks operating in the UK that are themselves branches or subsidiaries of non-resident companies
- dividends paid to those non-resident companies
- net interest payable on loan capital to companies where there is a direct investment relationship
Portfolio investment income (receivable): this mainly comprises;
- dividends received from holdings of equity issued by non-residents (not included in direct investment income)
- income receivable on bonds and notes, floating rate notes (FRNs), certificates of deposit, commercial paper and other paper issued by non-residents
Other investment income: this mainly comprises;
- loans and advances (or deposits)
- all interest receivable from (or payable to) non-residents on repo/reverse repo transactions
- interest receivable on special scheme lending for exports
Interest flows that have already been included in direct investment income are excluded.
Data are collected on an accruals accounting basis except for dividends which are collected on a cash basis. The data are presented according to the guidelines in the International Monetary Fund’s (IMF) Balance of Payments Manual (fifth edition). The data are therefore compatible with the data published by the Office for National Statistics (ONS). However, the ONS banking sector data may include estimates for data that were not collected on the Bank of England Forms and other adjustments.
Data for building societies are included with effect from 2008 Q1.
Relevant articles published in Bankstats:
- Transition of building society statistical reporting by Pat O'Connor - January 2008
- UK banks’ income and expenditure by Will Kerry and Daniel Wallace – March 2001
