RBS moves closer to re-privatisation

Now Reading:

RBS moves closer to re-privatisation

RBS moves closer to re-privatisation
Text size Aa Aa

Royal Bank of Scotland has reported stronger underlying profits.

Its operating profit was the equivalent of just over four billion euros last year, the highest since its taxpayer bailout in 2008, but its pretax losses totalled a little over six billion euros.

The closer it get to financial health the greater chance there is for the British government to sell the 82 percent of RBS it owns.

Chief Executive Stephen Hester spoke of “the light at the end of the tunnel” but the prime minister’s office said there was not yet a timetable for a sale.

Britain is considering a range of options for re-privatising the bank including giving shares away or selling shares to the public at a discount.

Bonuses cut

The bank paid out 607 million pounds (703 million euros) in bonuses for 2012, down 23 percent from 2011.

RBS has cut about 302 million pounds (350 million euros) from bonuses, clawed back from past awards or to be cut from future payments.

Bankers in Europe will have bonuses capped in future after agreement in Brussels on pay limits to try to curb financial sector excesses.

RBS is also to further reduce the scale and scope of its investment banking business, which was welcomed by UK finance minister George Osborne: “I want to see RBS as a British-based bank, focused on serving British businesses and consumers, with a smaller international investment bank to support that activity rather than to rival it.”