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RBS posts 26bn profits in surprise results release

25 Jul 14

The Royal Bank of Scotland has announced that it expects pre-tax profits of £2.6bn for the first half of the year, in a surprise early release of its first-half results.

The Royal Bank of Scotland has announced that it expects pre-tax profits of £2.6bn for the first half of the year, in a surprise early release of its first-half results.

The bank said that the figure, which is up £1.37bn from last year, comes as a result of a strong performance by its “bad bank” division.

It said that it had set aside just £269m for bad loans, down from £2.15bn last year, a much lower figure than it had expected.

The company, which is 80% owned by UK taxpayers since a government bailout in 2008, said it released the results a week early because they were significantly stronger than the market was expecting.

However, chief executive Ross McEwan warned of “bumps in the road ahead of us”.

“Let me sound a note of caution. We are actively managing down a slate of significant legacy issues. This includes significant conduct and litigation issues that will likely hit our profits going forward. I am pleased we have had two good quarters, but no one should get ahead of themselves here,” he said.

“These results show that underneath all the noise and huge restructuring of recent years, RBS is a fundamentally stronger bank that can deliver good results for customers and shareholders.”

He added that the company still faced “significant conduct and litigation issues”.

Earlier this month, the bank announced that it is considering selling the international operations of its private banking arm, Coutts.
 

Tags: RBS | UK Adviser

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International Adviser covers the global intermediary market that uses cross-border insurance, investments, banking and pension products on behalf of their high-net-worth clients. No news, articles or content may be reproduced in part or in full without express permission of International Adviser.