TROUBLED RBS BOUNCES BACK WITH £259MILLION PROFIT IN FIRST QUARTER OF 2017
Troubled Royal Bank of Scotland made a profit of £259m in the first three months of 2017, up from a £968m loss in the same period last year.
The bank said that after stripping out restructuring costs, the core operating business made a profit of £1.3bn, up from £1.02bn.
RBS, majority-owned by the government after being bailed out, added its cost-cutting plan was ahead of schedule.
It has already stripped out 37% of the £750m cuts planned for this year. The three-month profit is the first RBS has made since the third quarter of 2015.
In February, RBS reported a £7bn annual loss and chief executive Ross McEwan ordered a £2bn four-year cost-cutting drive involving job losses and branch closures.
Although RBS said in its statement that there would be no further provision for Payment Protection Insurance (PPI) mis-selling, the bank still faces costs for legacy issues.
BBC business editor Simon Jack said that, despite the progress being made, investors should not expect the bank to post a profit for the year.
“Big fines are still not settled with US authorities, but are expected to do so later this year and are likely to wipe out most if not all the money it makes in 2017,” he said.
Last week, Chancellor Philip Hammond admitted that the government was prepared to sell its 72% stake in RBS at a loss, bought in 2008 at a cost of £45bn.