| RBS posts a loss of £3.6bn but still to pay £1.3bn in bonuses |
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25/02/2010 12:55 (717 Day 01:16 minutes ago) | |||||
The FINANCIAL -- Royal Bank of Scotland Group (RBS) reported on February 25 a loss of 3.6 billion pounds ($5.5 billion) for 2009. Despite the loss, RBS said it will be paying out bonuses of £1.3bn to its staff.
The bank's chief executive, Stephen Hester, however, has said he will not take his own bonus, according to BBC. The UK taxpayer owns 84% of RBS after the government bailed out the bank at the end of 2008.
Hester told BBC Radio 4's Today programme RBS had lost out by not paying bigger bonuses. "We've had a small experiment in this respect... some of our best-performing people have been leaving in their thousands," he said, the same source reports. "The people who left us last year, I believe, would have increased our profits by up to a billion pounds beyond the ones that we've got."
RBS reported a net loss of 3.6 billion pounds ($5.5 billion), compared with a loss of 24.3 billion pounds a year earlier, the bank said, according to Bloomberg. That beat the 6.01 billion-pound estimate of nine analysts surveyed by Bloomberg. Impairments “now appear likely to have peaked,” the company said in today’s statement. “The group is ahead of its targets on every published measure for this first year of the five-year plan.”
RBS, which needed 45.5 billion pounds in taxpayer-funded support, is undergoing the most complicated restructuring of any company in history, Hester said last month, the same source reports. The bank is selling assets and halting some activities such as leveraged finance after putting 282 billion pounds of assets into a government protection program that caps losses on toxic loans.
The company's investment bank arm, global banking and markets, made a £5.7 billion operating profit for the full year compared with £1.8 billion loss in the previous, according to Times Online. RBS is the second big UK bank to report 2009 results, after Barclays announced record profits of £11.6 billion.
The same source reports that RBS said today that impairment charges on bad debt "rose sharply" to £13.9 billion from £7.4 billion in 2008, but noted that they "now appear likely to have peaked".
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