RBS makes £939m H1 profit; plans Netherlands move

RBS chief executive Ross McEwan

UPDATE 1 — Shares of Royal Bank of Scotland rose on Friday after it posted an attributable profit of £939 million for the first half of 2017 compared to a £2 billion loss in the same period last year.

RBS also said it is in discussions with the Dutch central bank to use the Netherlands as its NatWest Markets trading base in the European Union if the UK leaves the EU.

“NatWest Markets has reviewed ways to minimise disruption to the business and continue to serve its customers well in the event of any loss of EU passporting,” said RBS.

“Should the outcome of the current EU separation negotiations make it necessary, NatWest Markets is ensuring our existing RBS N.V. banking licence in the Netherlands is operationally ready.”

RBS was bailed out by the UK government for about £45.5 billion during the financial crisis and the UK taxpayer still owns about 71% of the Edinburgh-based banking group.

RBS CEO Ross McEwan said: “Our progress in the first half of the year means that today we can spend less time talking about the bank we were and more about the bank we are becoming.

“We have continued, at pace, to build a simpler, safer and even more customer-focused bank that has now delivered two consecutive quarters of bottom line profit – totalling £939 million.

“We’re doing what we said we would at our full year results in February – growing income, reducing cost and improving returns for shareholders, while also starting to deliver a better service for customers.

“We see the first six months of this year as proof of the investment case for this bank: our path to sustainable profitability is becoming clearer and closer and we have resolved some of the most significant issues this bank faced.”

Across its Personal & Business Banking (PBB), Commercial & Private Banking (CPB) and NatWest Markets (NWM) businesses, RBS reported an adjusted operating profit of £2.67 billion, an increase of £608 million, or 29%, compared with H1 2016.

Its Common Equity Tier 1 ratio increased by 70 basis points in the latest quarter to 14.8% and remains ahead of its 13% target.