THERE’S MONEYAND THERE’SVIRGIN MONEY

Page 2

Virgin Money at a glance

A strong, uncomplicated, retail-only bank

Unburdened by legacy

Proven track record of growth, quality and returns

Consumer focus of the Virgin brand

Underlying ROTE1 increased to 10.2% in H1 15, from 7.6% in H1 14

Clear strategy to deliver mid-teens ROTE in the medium term

Sizeable and scalable operating platform

Note: (1) Calculated as underlying profit after tax, annualised smoothed FSCS charge and AT1 coupon costs, as well as NCT1 coupon costs

prior to repurchase of that instrument in July 2014. With full FSCS change recognised H115, RoTE would be 9.0%

Page 3Note: (1) Calculated as underlying profit after tax, annualised smoothed FSCS charge and AT1 coupon costs, as well as NCT1 coupon costs

prior to repurchase of that instrument in July 2014. With full FSCS change recognised H115, RoTE would be 9.0%

Mid-teens

ROTE

10.2%1

Strong Asset

Quality

Lending

Funding

NIM

Expansion

Operational

Leverage

Capital

Optimisation

Non-Interest

Income

• Maintain

gross

mortgage

market share

of 3 to 3.5%

• Grow credit

card balances

to at least £3

billion by end

of 2018

• Grow

deposits, with

expected

market share

of stock under

2.0%

• LDR of no

more than

110%

• Maintain

current asset

quality whilst

continuing to

grow

• Cost of risk of

15-20bps in

the medium

term

• Increase

balance sheet

exposure to

credit cards

• Widen retail

margins with

increasing

BBR

• Grow retail

NIM towards

170bps in the

medium term

• Tight cost

management

• Highly

scalable

platform

• Target

cost:income

ratio of no

more than

50% by the

end of 2017

Minimum:

• 12.0% CET1

• 15.0% total

capital ratio

• 3.75%

leverage ratio

• Significant

capacity for

growth and

increasing

share of

wallet

Growth Quality Returns

1H 15

ROTE

Current

account

development

SME banking

Selected

acquisitions

Further

potential

depending on

regulatory

leverage

requirements

Targeting

mid-teens ROTE

in the medium term

Source: Company Information for all data

We have a clear strategy to deliver mid-teens RoTE

Page 4

A Strong Track Record of Growth…

Mortgage Balances (£bn) Gross Mortgage Lending (£bn)2 Net Lending Share (%)

New ProductsUnderlying Total Income (£bn)2

Life Insurance

Home & Motor Insurance

Investments

Credit Cards

Launched

Launching

Launched

Live

138.3 144.5 177.7 203.3 96.8 6.9 10.4 13.6 23.5 11.4

Market size (£bn)

Note: (1) The 2011 results of Virgin Money Holdings (UK) plc have been presented as if Northern Rock plc had been part of the Group during

2011 (2) Red box denotes annualised gross mortgage lending and underlying total income calculated by doubling H1 2015 performance

Page 5

… Combined with Consistent Quality…

Cost of Risk2 CET1

Net Promoter Score Staff Engagement

Notes: (1) The 2011 results of Virgin Money Holdings (UK) plc have been presented as if Northern Rock plc had been part of the Group during

2011 (2) 2014 Cost of Risk excludes benefit of debt sale of £8.9m

‘How likely on a scale of 0 to 10 would you be to recommend Virgin Money?’

NPS = % of 9 and 10 less % of 0 to 6

Page 6

… Drive Improving Returns

Return on Tangible Equity (%) Dividend

Net Interest Margin Cost:Income Ratio Underlying PBT2

2011

Interim dividend of

1.4pper share

announced H1 2015

2011

2011

Note: (1) The 2011 results of Virgin Money Holdings (UK) plc have been presented as if Northern Rock plc had been part of the Group during

2011 (2) Red box denotes annualised underlying PBT calculated by doubling H1 2015 performance

Page 7

Target Status

Mortgages 3-3.5% share of Gross Lending 3.8% share of Gross Lending

Credit Cards ~£3bn book by the end of 2018 Fully operational on own platform

Product Extensions Expand product offering Foundations in place

CapitalMinimum CET1 of 12% and

Leverage Ratio of 3.75%

CET1 Ratio of 18.7%

Leverage ratio of 4.1%

Cost of Risk Between 15 and 20 bps Cost of Risk of 12bps

NIM 170bps in 2017 165bps

Non Interest Income Grow non-interest income Grew in line with expectations

Operating Leverage C:I ratio of 50% by 2017 C:I Ratio of 62.2%

RoTEMid teens returns in the medium

termRoTE of 10.2%

Growth

Quality

Returns

Achieved On track

Target H1 2015 Progress Status

Recent Performance

Page 8

Mortgages Expect market share of around 3.5% for 2015

Credit Cards On track to meet target

Product Extensions PCA, Digital and SME opportunities

Capital Capitalised for growth

Cost of Risk Continues to enhance profitability

NIM Expect NIM just ahead of 160bps at FY 2015

Non Interest Income New products launching in H2 2015

Operating Leverage On track for Cost:Income ratio of no more than 50% in 2017

RoTE Mid-teens returns by the end of 2017

Outlook

Growth

Quality

Returns

Outlook

Page 9

Sizeable and scalable platform

Building sustainable growth for future…

Single customer view

Digital Stores Contact centre Intermediary Lounges Social media

Mortgages Credit cards Current accountsSavings Investments Insurance

Integration middleware

Core Systems

Channels (origination and servicing)

Proven Scalable Platform

24

91

0

10

20

30

40

50

60

70

80

90

100

H1 15 2007

Mo

rtga

ge B

alan

ces

(£b

n)

Proven customer appeal1

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Note: (1) Brand Consideration. Source: Consumer Insight, May 2014, consideration data based on those aware

Page 10

The Virgin brand: a consumer champion for 40 years

Page 11

• The coolest financial services brand in the UK, in 2013

and 2014

Mass appeal and footprint Differentiation

11%

5%

13%

16%

11%

1%

7%

13%

8%

3%

6% 7%

Ea

st

Ea

st

Mid

lan

ds

Lo

nd

on

Nort

h E

ast

Nort

h W

est

Nort

he

rn

Ire

lan

d

Sco

tla

nd

So

uth

Ea

st

So

uth

West

Wale

s

West M

idla

nd

s

Yo

rksh

ire

&

Th

e H

um

be

r

Customer Base UK Population Distribution

The Virgin Money Difference Drives Superior Returns

UncopyableDigitally led distribution

• 75% of customer contact is through digital channels

• Supported by 75 stores and 6 lounges

Page 12

Successful

acquisition and

integration

Straightforward

and transparent

products

Credit card

capability

Powerful and

disruptive brand

Strategic

Partnerships

Sizeable and

scalable operating

platform

Virgin Money is a Disrupter in UK Retail Banking

Q&A

Disclaimer

This document contains certain forward looking statements with respect to the business, strategy and plans of Virgin Money Group and its current goals and expectations relating to its future financial condition and performance. Statements that are not historical facts, including statements about Virgin Money Group’s or its directors’ and/or management’s beliefs and expectations, are forward looking statements. By their nature, forward looking statements involve risk and uncertainty because they relate to events and depend upon circumstances that will or may occur in the future. Factors that could cause actual business, strategy, plans and/or results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward looking statements made by the Group or on its behalf include, but are not limited to: general economic and business conditions in the UK and internationally; inflation, deflation, interest rates and policies of the Bank of England, the European Central Bank and other G8 central banks; fluctuations in exchange rates, stock markets and currencies; changes to Virgin Money’s credit ratings; changing demographic developments, including mortality and changing customer behaviour, including consumer spending, saving and borrowing habits; changes in customer preferences; changes to borrower or counterparty credit quality; instability in the global financial markets, including Eurozone instability and the impact of any sovereign credit rating downgrade or other sovereign financial issues; technological changes; natural and other disasters, adverse weather and similar contingencies outside Virgin Money’s control; inadequate or failed internal or external processes, people and systems; terrorist acts and other acts of war or hostility and responses to those acts; geopolitical, pandemic or other such events; changes in laws, regulations, taxation, accounting standards or practices; regulatory capital or liquidity requirements and similar contingencies outside Virgin Money’s control; the policies and actions of governmental or regulatory authorities in the UK, the European Union, the US or elsewhere; the implementation of the EU Bank Recovery and Resolution Directive and banking reform, following the recommendations made by the Independent Commission on Banking; the ability to attract and retain senior management and other employees; the extent of any future impairment charges or write-downs caused by depressed asset valuations, market disruptions and illiquid markets; market relating trends and developments; exposure to regulatory scrutiny, legal proceedings, regulatory investigations or complaints; changes in competition and pricing environments; the inability to hedge certain risks economically; the adequacy of loss reserves; the actions of competitors, including non-bank financial services and lending companies; and the success of Virgin Money in managing the risks of the foregoing.

Any forward-looking statements made in this document speak only as of the date they are made and it should not be assumed that they have been revised or updated in the light of new information of future events. Except as required by the Prudential Regulation Authority, the Financial Conduct Authority, the London Stock Exchange plc or applicable law, Virgin Money expressly disclaims any obligation or undertaking to release publicly any updates of revisions to any forward-looking statements contained in this document to reflect any change in Virgin Money’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.