RBS achieves operating profit
by Gill Montia
Story link: RBS achieves operating profit
Royal Bank of Scotland (RBS) has reported operating profit of £713 million for the first quarter of 2010, compared with an operating loss of £1.35 billion in the final three months of last year.
Total impairments fell to £2.76 billion, from £3.09 billion in the fourth quarter of 2009, reflecting “continued underlying improvement in the global economy”.
However, after restructuring and other non-operating costs, plus £500 million allocated to the Government’s Asset Protection Scheme, the group recorded a pre-tax loss of £21 million.
The 84% state-owned bank says it has 12.8 million current account customers in the UK, has continued to increase its mortgage market share, and is looking to the recovery of its retail operations to spur future growth.
Group chief executive, Stephen Hester, is confident that RBS remains on track for delivery of its five year restructuring plan, the bank having begun 2010 much as expected.
However, Mr Hester warns: “We remain conscious of the economic imbalances still to be tackled globally and of the risk of specific events (such as those affecting Greece), with the associated danger of contagion.”
He also cautions: “Certain sectors, like real estate, also face a longer term work-out and there are ongoing losses for banks to absorb.”