Finance loss of RBS deepens

RBSRoyal Bank of Scotland (RBS) reported a sharp deterioration in loss on Friday. The higher fines for infringements and restructuring costs highlight the challenges in front of the creditor, nine years after it was financially supported in the biggest rescue of a bank in the world. RBS, which has not posted an annual profit since 2007, reported a loss of 6.96 billion GBP for 2016 compared to a loss of 1.98 billion GBP an year ago.

Although ago, even briefly, was the largest bank in the world by assets, now RBS is in the middle of a large, several years of restructuring, including asset sales, job cuts and pass through a series of corporate scandals.

RBS said that 2017 will probably be the last year with losses, heading toward the end of the darkest chapter in the 290-year history in which so far lost 58 billion GBP. The Edinburgh-based lender announced plans to cut costs by 2 billion GBP over the next four years to compensate for the challenges posed by low interest rates, for which the bank makes it harder money.

The revenues recorded a modest decline, the jump in loss is mainly due to fines for violations amounting to 5.9 billion GBP associated with the behavior of banks during the 2007-2009 financial crisis.

Analysts believe that the bank may need to pay the United States Department of Justice about 9 billion GBP this year in a case involving the sale of US bonds backed by toxic mortgages.

RBS was the only bank that fails the stress tests of the Bank of England in 2016 – a signal that the future of the creditor still dictated by its past.