RBS recovery remains elusive

The biggest item is a £4.65bn accounting charge for the improved value of RBS's own credit - essentially, a measure of the cost of buying back its own liabilities. Then there's a £1.11bn hike in the provision for payment protection insurance (PPI) mis-selling redress - bringing the total set aside to £2.2bn. There's also a further £650m provision to cover redress for mis-selling interest rate hedging products and RBS's Libor-rigging fine wiped another £381m off profits. A £1.04bn operating loss at Ulster Bank hurt, too. Ireland's property market collapse has hit Ulster hard and the £1.36bn impairment charge the unit incurred represents a hefty 26 per cent of the group's £5.28bn impairment charge.

With that backdrop, and given government impatience to recoup at least some of the £45.5bn used to bailout RBS, chief executive Stephen Hester announced two initiatives. First, the investment bank will have its risk-weighted asset base hacked back to £80bn to release capital. Ironically, improved financial market conditions helped operating profit there to grow 68 per cent to £1.5bn. Second, US lender Citizens will be partially floated - its bad debt charge fell from £326m last year to just £91m, with the operating profit up 40 per cent to £754m.

UK performance, meanwhile, remains lacklustre. The retail unit reduced its impairment charge by 33 per cent to £529m, but operating profit still fell 6 per cent to £1.89bn amidst weak customer demand. The poor economic backdrop hit the corporate arm, too, and operating profit there fell 7 per cent to £1.8bn.

Prior to these figures, broker Investec Securities was expecting EPS of 13.7p for 2013 (from a loss of 53.7p in 2012), and tangible net assets (NTA) of 474p.