RBS required government rescue loans of 45 billion pounds during the financial crisis in 2008.
Advertisement
McEwan said in February RBS would dramatically shrink its investment banking operations and would pull out of 25 countries across Europe, Asia and the Middle East to refocus on Britain.
In June, George Osborne, the chancellor of the Exchequer, announced plans for the government to begin to reduce its stake in RBS, even if it had to record a loss on some holdings.
Litigation and conduct costs were lower at £459m compared with £856min Q1 2015, while restructuring costs rose to £1.05bn from £453m in Q1 2015 as the pace of restructuring accelerated.
“I don’t like seeing losses and I’ll not rest until these charges are behind us,”Mr McEwan said”.
The sobering announcement came as the state-backed lender revealed it had slumped to a £153million loss in the first half of the year, down from a £1.4billion profit in the same period last year.
The bank’s overall £153m loss compares to a profit over the same period last year of £1.4bn.
“This is dependent on the achievement of certain strategic objectives, including sustained profitability, improved stress test results and resolving our major conduct and litigation issues”, the bank said.
He is leaving the bank at the end of August after more than six years on the board, and said he did not realise the full scale of the problems when he took the job.
Royal Bank of Scotland has reported a 27% increase in second-quarter profit after booking more mortgage applications.
The group said its corporate banking business was likely to be impacted but did not provide further details.
These would stop the bank making any returns to shareholders through dividends or share buybacks until at least the first quarter of 2017 – later than the City had been expecting.
RBS chairman Philip Hampton says: “The decisions to sell or run-off significant parts of the business while investing in our core customer franchises has meant we are better positioned to deal with the constraints of structural regulatory reform, notably ring-fencing”.
He said, however, that “a number of clouds remain” on the horizon for RBS as it continues to rebuild.
Advertisement
Competition authorities are now looking at the impact on the market of the sale of Williams & Glyn, with their review expected later this year.
