RBS 'on track' with £392m profit in third-quarter

The high street lender awaits multibillion fine from DoJ

State-backed Royal Bank of Scotland is ‘on track’ as it reported a profit of £392m for the third quarter, up from a loss of £469m in the same period last year.

Talking about how pleasantly surprised he was at the resilience of the UK economy, RBS chief executive Ross McEwan said today: “Our strategy to deliver a simpler, safer, customer-focused bank is working.”

“We have grown income, reduced costs, made better use of our capital and continued to make progress on our legacy conduct issues. Our core bank continues to generate strong profits and we remain on track to hit our financial targets, ” McEwan added.

Read related story: Here’s what you need to know about RBS’ massive fine

The high street lender — which remains around 70 per cent owned by taxpayers following its rescue during the financial crisis — is still counting the cost of past mistakes, media reports suggest, adding that the restructuring costs are around £244m.

But both sums have come down in the last year and the latest profit figure was the third in a row in which it has been in the black.

This year’s figure of the bank could be weighed down by the group making provision for a multi-billion dollar penalty from the US Department of Justice (DoJ), which is investigating RBS’s sale of toxic mortgage bonds a decade ago. The bank has agreed to pay $35m and enter into a non-prosecution agreement with the DoJ to settle the probe.

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