Published: Sat, February 25, 2017
Markets | By Terence Owen

RBS confirm ninth straight year of losses

RBS confirm ninth straight year of losses

RBS also said it is pushing its medium-term target of a 12% return on tangible equity and cost to income ratio of below 50% back one year to 2020.

RBS has reported an annual loss of £6.96bn for 2016 - a sharp fall the £1.98bn loss reported in the same period a year earlier. The results come after the bailed-out lender recently booked a £3.1-billion charge for its upcoming settlement with United States authorities for mis-sold mortgage-backed securities.

Friday's figures take into account £10bn in legacy costs, including £5.9bn on conduct charges and a £2.1bn restructuring hit.

"These costs are a stark reminder of what happens to a bank when things go wrong and you lose focus on the customer as this bank did before the financial crisis", Chief Executive Ross McEwan said in a statement.

According to the FT, RBS' total losses amount to £58bn since the bank's £45.5bn bailout in 2008.

The FTSE 100 group noted that it was targeting £2 billion of cost cuts in the next four years with around two thirds to come from the core bank.

RBS has spent some £1.8bn over a number of years on attempting to divest Williams & Glyn.

RBS shares have climbed 7 percent since the beginning of the year.

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The 52 week high of shares in Royal Bank Of Scotland Group is 260.9 while the 52 week low for the company's shares is 148.4.

RBS is in now implementing a multi-year restructuring which includes asset sales, job cuts and legal actions.

This week, Barclays and Lloyds Bank announced they had set aside a further £1 billion each in 2016 to cover PPI payouts, while HSBC increased its provision by £400 million in 2016.

It will include £750m of savings in 2017.

The chief executive had said the bulk of mis-selling cases would be settled in 2016, but the largest penalties from the U.S. over mis-selling toxic mortgages have yet to be resolved.

The Royal Bank of Scotland's (RBS) poor financial results have led to its CEO calling for more cost reductions and a faster digital transformation.

The bank gave no further details in the annual results Friday of the alternative plan revealed earlier in February that would see it instead fund United Kingdom challenger banks to enable more small business lending.

Excluding the litigation and restructuring costs, as well as goodwill writedowns and debt redemptions, RBS said it made an adjusted operating profit of GBP3.67 billion, down from GBP4.41 billion the prior year.

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