RBS Says Private Banking Operations Back In Profit In Q3

Tom Burroughes

2 November 2015

, partly owned by the UK government, logged a third-quarter profit, attributable to shareholders, of £952 million ($1.461 billion), up slightly from £896 million a year earlier. The bank, which is seeking to boost profitability ahead of any return to full private ownership, said restructuring costs remained high at £847 million.

Litigation and conduct costs were £129 million compared with £780 million a year earlier.

At the private banking unit (this covers businesses such as Coutts and Adam & Co) RBS said total income in the third quarter of 2015 was £204 million, versus £207 million in the previous quarter. There was an operating profit of £15 million in the latest quarter, against a loss of £78 million in the second quarter. In Q3, RBS said it had a cost/income ratio of 91 per cent.

RBS earlier this year agreed to sell its international private banking business to Geneva-headquartered Union Bancaire Privée. RBS said the disposal of this unit “continues to make good progress”. The sale of the European, Middle East and Africa business, including Switzerland, is scheduled to close in the fourth quarter of this year and the sale of the business in the Far East is scheduled to close next year.

Assets under management were down £1.5 billion from end-June, principally reflecting lower stock market valuations, it said.

RBS said it has increased its capital strength; its common equity tier one ratio – a standard measure of bank capital strength under international standards – rose to 12.7 per cent at 30 September, up 40 basis points from 30 June 2015 and 150 basis points from 31 December 2014. Total customer deposits were £128 billion at the end of September.