LONDON: State-rescued Royal Bank of Scotland more than doubled net profits in 2018, the lender announced Friday as it extends its recovery following a decade of turmoil.
RBS said in a statement that profit after tax jumped to £1.62 billion ($2.10 billion, 1.84 billion euros) last year.That compared with £752 million in 2017, which had been the Edinburgh-based lender's first annual net profit following the global financial crisis, reports AFP.
RBS, saved at the height of the crisis in 2008 by the UK government in the world's biggest banking bailout, built on its recovery last year thanks to lower costs and an improved trading performance, its earnings statement showed. "2018 was a year of strong progress on our strategy -- we settled our remaining major legacy issues, paid our first dividend in ten years and delivered another full-year bottom line profit," chief executive Ross McEwan said on Friday. "Our financial performance is good, given the uncertain economic outlook," McEwan said while noting that "the UK economy faces a heightened level of uncertainty related to the ongoing Brexit negotiations". In October, RBS said it had set aside an additional £100 million to cover bad loans, "reflecting the more uncertain economic outlook" that analysts said referred to Britain's looming exit from the European Union. The bank, like many businesses, is planning for the worst amid increasing worries that Britain will crash out of the EU on March 29 without a deal.
"Resolution is required," New Zealand national McEwan told the BBC on Friday.
"The longer this drags on, the harder it is for business to invest and it does impact on everyday people," he added.
Following the earnings update, the share price of RBS was down 0.8 percent at 239 pence on London's FTSE 100 index, which edged up 0.1 percent overall.
"RBS delivered a stellar set of numbers and a forecast-beating dividend payout to investors, but Brexit and other factors mean it will fall short on its cost-cutting target," noted Neil Wilson, chief market analyst at Markets.com.