Royal Bank of Scotland reports half-year profit for the first time in three years
PUBLISHED: 08:45 04 August 2017 | UPDATED: 08:45 04 August 2017
High street lender Royal Bank of Scotland has reported a half-year profit for the first time in three years as chief executive Ross McEwan signalled the bank is moving on from its troubled past.
The bank, which is still 72% owned by the taxpayer, recorded a £939m profit for the six months to June 30, which compares with a £2bn loss in the same period last year.
Second-quarter profit came in at £680m, representing the bank’s second consecutive quarter in the black and follows on from a £259m profit in the first three months of the year.
Mr McEwan said: “We’re doing what we said we would at our full-year results in February - growing income, reducing cost and improving returns for shareholders, while also starting to deliver a better service for customers.
“We see the first six months of this year as proof of the investment case for this bank: our path to sustainable profitability is becoming clearer and closer and we have resolved some of the most significant issues this bank faced.”
RBS also said it has begun contingency planning for Brexit by engaging with the Dutch central bank to use its existing banking licence in the Netherlands.
The bank requires an EU passport to continue operating its NatWest Markets business across the bloc and is the latest bank to outline Brexit plans.
First-half operating profit came in at £1.95bn compared with a £274m loss last year, while adjusted operating profit rose from £1.15bn to £3bn.
However, RBS also detailed £342m in second-quarter conduct and litigation costs and £213m in restructuring charges.
When added to costs booked in the first quarter, it takes the total for the first half to more than £1bn.
The group has racked up several billion in litigation and conduct costs since it was rescued by the Government at the height of the financial crisis.
Last month, RBS agreed a £4.2bn US settlement over claims that it mis-sold toxic mortgage bonds in the run-up to the crisis, and it took a £151m charge in its second quarter as a result of the deal.