Royal Bank of Scotland says profits treble

RBS has paid out billions of dollars over its role in the 2008 subprime housing meltdown
AFP

London (AFP) – Britain’s state-rescued Royal Bank of Scotland saw first-quarter net profits more than triple on lower restructuring costs and rising income, it said Friday.

Earnings after taxation surged to £792 million ($1.1 billion, 911 million euros) in the first three months of 2018, RBS announced in a results statement.

That easily beat analysts’ consensus forecasts and compared to a £259-million profit in the same part of 2017.

The Edinburgh-based lender — which is still 71-percent owned by the government — added that operating or underlying profit rallied 70 percent to £1.21 billion.

Total income increased by three percent to £3.3 billion.

“This is a good set of results, showing the progress we are making, despite a more competitive market,” said chief executive Ross McEwan.

“Our income is up, costs are down and our capital has strengthened again.”

RBS booked £209 million in restructuring costs, down from £577 million last time around, while there were also £19 million in conduct and litigation charges for the quarter.

However, it did not show any charges for payment protection insurance (PPI) mis-selling claims.

The group is meanwhile yet to reach what is expected to be a multi-billion-dollar penalty settlement with the US authorities over claims that it mis-sold mortgage-backed securities in the run-up to the global financial crisis.

Britain’s Conservative government had announced last year that it planned to re-privatise RBS with the aim of selling £15 billion of its stake by 2023.

Back in February, RBS had posted its first annual bottom-line profit since 2007, or the eve of the global financial crisis, following a huge drop in litigation costs.

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