This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at http://www.bbc.co.uk/news/business-24767624
The article has changed 13 times. There is an RSS feed of changes available.
| Version 3 | Version 4 |
|---|---|
| RBS avoids being split into 'good' and 'bad' banks | RBS avoids being split into 'good' and 'bad' banks |
| (35 minutes later) | |
| Royal Bank of Scotland has said it will not split itself into separate so-called good and bad banks. | Royal Bank of Scotland has said it will not split itself into separate so-called good and bad banks. |
| RBS will create an internal "bad bank", ring-fencing £38bn of bad assets - such as loans it does not expect to have repaid. | RBS will create an internal "bad bank", ring-fencing £38bn of bad assets - such as loans it does not expect to have repaid. |
| The bank remains 81%-owned by the government following a massive bailout at the height of the financial crisis. | The bank remains 81%-owned by the government following a massive bailout at the height of the financial crisis. |
| RBS also announced a pre-tax loss of £634m for the three months to 30 September. | RBS also announced a pre-tax loss of £634m for the three months to 30 September. |
| In all, three separate topics relating to RBS were released on Friday: The company's own third quarter results report, a report into its small business lending practices by Sir Andrew Large, and the one commissioned by the government into whether or not to spilt the bank into two. | |
| The main points include: | |
| RBS said it would make a heavy loss this year partly because it plans to sell the assets - the bad loans - held by the internal bad bank. | |
| This will lead to an accounting write-off of up to £4.5bn. | |
| Including one-off items and the new PPI charge of £250m, RBS made a loss of £634m. | |
| Scandals | Scandals |
| The report released into small business lending said the bank was performing so badly on lending to small businesses it was not even meeting its own targets for the sector. | |
| RBS's review into how it serves its individual customers is scheduled to report its conclusions early next year. | |
| Like its fellow banks, RBS has been caught up in the mis-selling of payment protection insurance (PPI) - cover customers either did not need or did not qualify to use - and other banking scandals. | |
| In a separate development just ahead of the results, RBS suspended two traders in connection with an investigation into the possible manipulation of foreign exchange rates. | In a separate development just ahead of the results, RBS suspended two traders in connection with an investigation into the possible manipulation of foreign exchange rates. |
| Earlier this year, RBS was fined hundreds of millions of pounds for its involvement in rigging Libor interest rates. | Earlier this year, RBS was fined hundreds of millions of pounds for its involvement in rigging Libor interest rates. |
| 'More resilient' | 'More resilient' |
| The decision to keep the bad assets within the bank, but ring-fenced and managed separately, goes against the advice of the Parliamentary Commission on Banking Standards, which this summer suggested that toxic loans should be removed from RBS and kept in the public sector for the foreseeable future. | The decision to keep the bad assets within the bank, but ring-fenced and managed separately, goes against the advice of the Parliamentary Commission on Banking Standards, which this summer suggested that toxic loans should be removed from RBS and kept in the public sector for the foreseeable future. |
| Toxic loans - or assets - include loans and mortgages that are not expected to be repaid, as well as more complex investments related to these bad loans. | Toxic loans - or assets - include loans and mortgages that are not expected to be repaid, as well as more complex investments related to these bad loans. |
| The Bank of England said that it welcomed the plans for RBS's future structure, saying: "These actions should create a more resilient institution that is better able to support the real economy without any expectation of further government support." | The Bank of England said that it welcomed the plans for RBS's future structure, saying: "These actions should create a more resilient institution that is better able to support the real economy without any expectation of further government support." |
| RBS is still 81%-owned by the taxpayer, but unlike Lloyds, in which part of the taxpayer's stake was sold last month, there are no immediate plans to reduce that investment. | RBS is still 81%-owned by the taxpayer, but unlike Lloyds, in which part of the taxpayer's stake was sold last month, there are no immediate plans to reduce that investment. |
| Earlier this year the bank's chairman, Sir Philip Hampton, said privatisation could begin as early as next year. | |
| But the BBC's business editor says the first stages of privatisation are unlikely to take place until after the 2015 general election. | |
| The government bought the shares at the height of the financial crisis at just over 500p a share. | The government bought the shares at the height of the financial crisis at just over 500p a share. |
| They are currently well below that, at 367p. | They are currently well below that, at 367p. |