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Business

Royal Bank of Scotland sees losses widening

Bailed-out Royal Bank of Scotland has reported huge net losses for 2016. The lender is still reeling from massive litigation and restructuring costs after being accused of mis-selling mortgage-based securities.

Royal Bank of Scotland said Friday its 2016 annual losses more than tripled to 6.95 billion pounds ($8.7 billion, 8.21 billion euros).

RBS, which was bailed out by the British government following the 2008 financial crisis, posted its ninth consecutive annual loss last year.

The Edinburgh-based lender said it had been severely hit by litigation and conduct costs of almost 5.9 billion pounds, including over its issuance of US mortgage-based securities and its role in the mis-selling of a UK insurance product.

Streamlining effort

Restructuring costs last year amounted to 2.1 billion pounds, RBS reported.

"These costs are a stark reminder of what happens to a bank when things go wrong and you lose focus on the customer as this bank did before the financial crisis," Chief Executive Ross McEwan said in a statement.

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Talk: Massive debt and the banking crisis

RBS is almost 73-percent state-owned after the lender was saved with 45.5 billion pounds in taxpayer's cash in the world's biggest banking bailout at the height of the global financial crisis.

On Friday, RBS said it would slash operating expenses by a further 2 billion pounds over four years, with 750 million of savings to be made in the course of 2017.

hg/jd (AFP, Reuters)

 

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