RBS Losses Drop

Royal Bank of Scotland has posted an improved loss of £1.1bn for 2010 compared to the £3.6bn loss the taxpayer-backed bank posted in 2009.

However loan impairments at RBS’ Irish subsidiary Ulster Bank rose by almost 80 per cent while losses more than doubled to £761m, which subsequently accounted for 40 per cent of the bank’s total impairment charge of £9.2bn across all its operations.

But the bank added that this was a significant improvement on the £13.8bn impairment charge RBS suffered the previous year.

Mortgage impairment losses totalled £30m of a mortgage book valued at £91bn, while residential mortgage lending increased by £6bn for the full year, which was partially offset by reduced lending in its subsidiaries Ulster Bank and US Retail and Commercial.

Lending to small and medium sized enterprises (SMES) totalled £30.3bn for the year as gross new lending to UK businesses across the year reached £55.3bn.

The bank said that while demand for new credit facilities remained strong, businesses were still focussed on deleveraging, as reflected by a rise in net repayments to £4.6bn in the final quarter of 2010, compared to £3.7bn in the preceding quarter.

Stephen Hester, chief executive of RBS, said, "The weaknesses uncovered by the financial crisis - of leverage, risk concentration and business stretch - are being fixed."

Posted at 04:16PM Feb 25, 2011 by Marc Stenton in The Economy  |  Comments[0]