Royal Bank of Scotland (RBS)'s full-year figures revealed a heftier loss than anticipated – reflecting rising bad debts at its Irish unit, a £1.1bn hike in Greek sovereign debt impairment charges and a painful £850m payment protection insurance-related charge.
Indeed, and while the group's bad debt charge fell 20 per cent to £7.44bn, Ulster Bank's impairment charge rose 19 per cent to £1.38bn, meaning a divisional loss of £1bn. That largely reflected a deterioration in the mortgage book as tough Irish economic conditions affected customers. The global banking and markets division (its investment banking arm) had a rough ride, too – operating profit here slipped 54 per cent to £1.56bn as market volatility hit deal flow.
Still, profit in the UK retail arm increased 45 per cent to £1.99bn, helped by a 32 per cent fall in the unit's impairment charge. While the insurance unit – which includes Churchill and Direct Line and is being prepared by management for disposal – boosted underwriting profits from £307m in 2010 to £1.04bn.
Prior to these figures, Charles Stanley had been forecasting underlying EPS of 2.5p for 2012.
ROYAL BANK OF SCOTLAND (RBS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 28.61p | MARKET VALUE: | £31bn | |
| TOUCH: | 28.6-28.63p | 12-MONTH HIGH: | 48.4p | LOW: 17.2p |
| DIVIDEND YIELD: | NIL | PE RATIO: | NA | |
| NET ASSET VALUE: | 69p* | |||
| Year to 31 Dec | Pre-tax profit (£bn) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|
| 2007 | 9.64 | 64.0 | 27.0 |
| 2008 | -25.70 | -146.2 | nil |
| 2009 | -2.65 | -6.3 | nil |
| 2010 | -0.40 | -0.5 | nil |
| 2011 | -0.77 | -1.8 | nil |
| % change | - | - | - |
*Includes intangible assets of £14.9bn, or 14p a share | |||
