RBS posts £1.5bn loss in first half of 2012

The Royal Bank of Scotland took a dent with their finances this year: they've just ...

12:32 05 August 2012

The Royal Bank of Scotland took a dent with their finances this year: they've just posted that they've made a loss of £1.5 billion in the first half of this year. 

 

They've also set aside £125m to cover the costs brought on by recent computer glitches. 

 

The reports prompted chief Stephen Hester to issue a warning that this is a "grim period" for the financial industry however he did boast that they had "achieved an important milestone" by repaying all the Government loans given to it during the credit crisis. 

 

The banking group also put aside £135m for the mis-selling of Payment Protection Insurance. An additional £50m was also reserved for compensation over the interest rate swaps scandal - and this figure is expected to rise. 

 

Despite all this, RBS claims to have made an operating profit during the same six month period of 2012 to the tune of £3.2 billion. 

 

In the aftermath of the Libor scandal, RBS (which is 82% owned by the government) has dismissed numerous staff members for misconduct in an aim to get back on track as their reputation has hit an all-time low.

 

"All companies make mistakes and have individual cases of wrongdoing," Mr Hester told Radio 4.

 

"Most things that had gone wrong in the industry as a whole had also been present within RBS... The nature of financial services tends to magnify the impact of these.

 

"The Libor situation is on our agenda and is a stark reminder of the damage that individual wrongdoing and inadequate systems and controls can have in terms of financial and reputational impact. This is the subject of ongoing regulatory investigation but our customers and shareholders should be in no doubt that we are taking it seriously. These issues together are hard to deal with but just as necessary a part of change from the past as the restructuring of our balance sheet." 

 

Around 5,700 jobs have been cut from the same period last year.