16:13 28 February 2013
The Royal Bank of Scotland, which is mostly owned by the state, has reported a pre-tax loss of around £5.2billion for 2012. The same year saw the group pay-out large amounts for fines relating to PPI as well as the Libor case.
The announcement came on Thursday morning, 28th February, signalling that this was the fifth year the giant banking corporation has suffered a loss. Compared to its loss for the previous year, where RBS reported a loss of £1.2billion in 2011, the amount is far greater.
Although, the company has experienced certain achievements during the last year. The bank claims that they made an operating profit of almost £3.5billion, which is significantly higher than what they reported for 2011.
The Chief Executive of RBS Stephen Hester said in a statement: “RBS is four years into its recovery plan and good progress has been made. We are a much smaller, more focused and stronger bank. Our target is for 2013 to be the last big year of restructuring.”
RBS was faced with a £450million fine with regards to mis-selling payment protection insurance (or PPI), which meant they had allotted £2.2billion of their funds to mis-selling. Also, the group suffered a cost of £381million over the Libor scandal.
Chancellor George Osborne commented on RBS where he said: “The Government's strategy is for RBS to be a stronger and safer bank, which in time can be returned to full private ownership.”
He added: “I have been very clear that 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.”
So, things could look positive for the bank in the future. RBS was taken over by the state over fours ago due to the state of the economy.
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