NS&I Annual Results to the year ending 31 March 2003

National Savings and Investments (NS&I), the government-backed savings and investments provider, today announces its annual results and publishes its Annual Report for the year to 31 March 2003.

NS&I is one of the UK's largest financial providers, with 30 million customers and £63 billion invested and is unique in that it provides retail savings and investments that are 100% secure, backed by HM Treasury. Its total balance of funds represents 19.5% of the national debt. NS&I has positioned itself as a major competitor in the mainstream financial services industry.

Highlights 2002-03

• £784 million net financing for government (funds raised for government), increasing balance of funds to £63.1 billion as at 31 March 2003.
• At the beginning of 2002-03, NS&I forecast a net reduction in financing of £1.5 billion but actually achieved a net increase of £784 million, a turnaround of £2.28 billion over forecast
• £11.2 billion gross sales of NS&I's savings and investments products (£10.3 billion in 2001-02)
• £224 million - savings to the taxpayer by reducing the cost of government borrowing
• Premium Bond sales £4.75 billion, of which over £604 million were sold in February 2003 - at the time an all time monthly high (£1.1 billion were sold in May 2003)
• New five year plan aims to grow total financing by £10 billion by 2007-08
• Banking Code subscription effective from 1 March 2003, the first time NS&I subscribed, bringing it in line with other mainstream financial providers.

Alan Cook, NS&I chief executive, said:

"Our growth during the past year has been driven largely by a flight to safety and the 100% security offered by our products. Savers and investors have also taken advantage of our improved distribution channels and invested considerable amounts of money in our Premium Bonds and Guaranteed Equity Bonds. In the first quarter of 2003, we sold £1.7 billion Premium Bonds.

"But the challenge for us now is to ensure that we can continue to attract customers in the future because they find our savings and investments a worthwhile proposition, not just because they have turned their back on the stock market. We want to be the first port of call for people with money to save or invest.

"We firmly believe we are up to the challenge of competing in mainstream financial services and aim to increase total financing by £10 billion by 2007-08."

Distribution developments: 2002-03

• NS&I's new website, launched in July 2002, generated £147 million sales in the year
• Website visitors nearly trebled throughout the year with up to 30,000 per day
• £500 million generated through telephone sales with two million calls to NS&I's customer enquiries centre, up 21% on the previous year
• 80% of calls are answered within 20 seconds - by a person, not a machine
• £4.7 billion sales and 17 million transactions through the Post Office

Notes to Editors

1. National Savings and Investments Annual Report and Accounts 2002-03 was presented to the House of Commons pursuant to section 7 of the Government Resources and Accounts Act 2000 on 17 September 2003. It is formally published by The Stationery Office (TSO) on 18 September 2003.
2. National Savings and Investments is one of the largest savings organisations in the UK, offering a range of savings and investments products (to 30 million customers). All products offer 100% security, because they are backed by HM Treasury. NS&I is a government department and an executive agency of the Chancellor of the Exchequer, reporting to Ruth Kelly MP, the Financial Secretary to the Treasury.