RBS posts profits of nearly £1bn

Royal Bank of Scotland has posted a profit just short of £1 billion for the first-half of the year.

The still 73 per cent state-owned lender said that it made a profit of £939m in the first six months of 2017, despite incurring the cost of a £396 million one-off payment to settle the legal case surrounding a major US-based mortgage scandal.

The performance marks a big turnaround from the £2bn loss in the same period of 2016.

RBS also took the occasion of its half year report to announce that it is talking to Dutch authorities about locating its European headquarters in Amsterdam after Brexit.

The operation would require about 150 staff, with some relocated from London and others hired locally.

RBS already has a licence to operate in the Netherlands, which is a legacy of its purchase of the Dutch bank ABN Amro in 2007.

The move would be unlikely to have any significant impact on the company’s corporate headquarters in Edinburgh.

Key points:

Chief executive Ross McEwan said: “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.”

In reference to the UK economy, Mr McEwan added that he saw signs of strength, with net lending growing 4 per cnet in the first half of the year.

He said UK retail customers were still spending, but note that big business customers were being more cautious about making investments.