RBS bounces back with £1.5bn profits
« Previous « PreviousNext » Next »View GalleryPublished Date: 20 July 2009
By GARETH EDWARDS
THE ROYAL Bank of Scotland is being tipped to record half-year profits of more than £1.5 billion, just a year after posting its first ever corporate loss.
City analysts said the bank, which is 70 per cent owned by the taxpayer, had benefited from recovery in the global markets.
The interim figures, due to be published on August 7, will also benefit from the disposal of assets.
Analysts said the sADVERTISEMENTecond-quarter figures posted by US banks Goldman Sachs and JP Morgan showed there were signs of a recovery in the banking sector.
JP Morgan unveiled a 36 per cent rise in profits to £1.6bn, while Goldman reported profits of around £2bn.
Last year RBS recorded a loss of £692 million – the first in its 41-year history.
This was put down to the disastrous takeover of Dutch bank ABN Amro, a £71bn deal led by RBS, which saw the Edinburgh-based bank put up £48bn.
Since then, the bank is estimated to have made £2bn from selling off its stake in Bank of China and Spanish insurer Linea Direct. Further gains came from a buy-back of some of its debts in April, which reportedly made it an accounting gain of £4.5bn.
News of the positive figures came as chief executive Stephen Hester continued his fight to prevent a sell-off of RBS assets being ordered by the European Competition Commission.
The competition commissioner Neelie Kroes has warned that both RBS and Lloyds Banking Group, which is 43 per cent owned by the taxpayer, would have to sell off key assets to offset the massive injection of state aid.
Former head Sir Fred Goodwin previously put RBS insurance operations on the market, but failed to finds a buyer willing to pay a suitable price.
The bank always insisted there would be no fire sale of assets as a consequence of accepting a government bail-out, but could now be forced to sell off further parts of its worldwide business.
Mr Hester's plans for the recovery of the bank are expected to include the sale of some assets anyway, however, and its operations in Asia are already being wound down.
He said in January that he wanted to divide the group into "core" and "non-core" divisions, retaining the core assets and selling off the non-core businesses – estimated to be worth £300bn – over the next five years.
This plan could be jeopardised if certain assets were earmarked for sale by the ECC, and Mr Hester is understood to have held meetings with the European Commission in Brussels "under his own initiative" to outline his plans for the recovery of the bank.
A source said: "It wasn't a formal meeting. Stephen wanted to introduce himself and make sure the competition authorities understood properly his plans for recovery, which include substantial disposals. Stephen has a clear plan. The last thing he needs is to be torpedoed by the EC."
schaun mer mal
Zurück
Werbung
