RBS £3.6bn hit for pension, litigation, PPI

RBS chief executive Ross McEwan

Royal Bank of Scotland said it will make a £3.6 billion provision to cover pension payments, litigation over mortgage-backed securities and issues connected to payment protection insurance (PPI).

RBS also unveiled a goodwill impairment charge of £498 million at its private banking business.

The measures will result in a £2.5 billion reduction in 2015 fourth quarter profits.

RBS shares fell more than 3% in early trading.

“I am determined to put the issues of the past behind us and make sure RBS is a stronger, safer bank,” said RBS chief executive Ross McEwan (pictured).

“We will now continue to move further and faster in 2016 to clean-up the bank and improve our core businesses.

“We’ve always been open about the scale of past issues facing RBS and although there is clearly much more to do, this announcement is a further step towards addressing legacy issues and building a great bank for our customers and delivering long term value for our shareholders.”

Details of the latest RBS setback were contained in a trading statement published on the London Stock Exchange’s Regulatory News Service. A link the statement is provided below.