RBS back in the black for first time in a decade
PUBLISHED: 08:48 23 February 2018 | UPDATED: 08:48 23 February 2018
Royal Bank of Scotland (RBS) has reported its first profit in a decade.
Its £752m annual profit compares to the £6.95bn loss reported by the lender a year ago – one of the biggest since its government bailout in 2008 as it dealt with conduct charges, legacy and restructuring costs.
The results beat analysts’ expectations, who had pencilled in a full-year attributable loss of £592m for 2017 and consensus figures also pointing to £2.7bn worth of conduct and litigation costs.
Friday’s figures take into account conduct and litigation costs of £1.29bn, part of which was to help cover costs to deal with claims that it mis-sold mortgage-backed securities in the run-up to the financial crisis.
However, the lender – which is still 72% owned by the taxpayer – has yet to reach what is expected to be a multi-billion dollar settlement with the US Department of Justice over those mortgage-backed securities sales.
Those conduct costs also included £175m in provisions to cover costs surrounding mis-selling of payment protection insurance (PPI).
RBS also pushed ahead with its cost-cutting drive and restructuring plan, having cut expenses by £810m last year, exceeding its £750m target.