Royal Bank of Scotland posts £3.5bn loss for 2014

26th February 2015

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The Royal Bank of Scotland has reported a £3.47bn loss in its annual results, down from £8.9bn in 2013.

The bank, which is still 79% state-owned following its bailout during the financial crisis, said the results reflected the £4bn writedown on the offloading of its US business Citizens.

It said it had also put aside £2.2bn in litigation and conduct provisions. Following the announcement shares in the group had dropped 1% or 4.8p to 398.5p by 8:56am.

RBS chief executive Ross McEwan said he would not receive a bonus but the bank will still share bonuses from a pool of £421m.

Speaking to the BBC Today programme McEwan described the staff bonuses as “fair pay” and said it was necessary to attract people to carry out “fairly technical jobs.”

The BBC reported that the Chancellor George Osborne has written to the new chairman of the bank, Howard Davies, asserting that he expected the bank not to give bonuses to senior executives.

He wrote: “I would also expect that, as in the past, no executive directors or members of the executive committee will receive bonuses, despite improved profitability.”

“Given the extraordinary support it has enjoyed in the past from taxpayers, I know you recognise that RBS must remain a backmarker on pay and continue to show responsibility and restraint.”

In its results statement, the bank said it had cut costs by more then £1bn and is set to save another £800 this year.

McEwan said: “Last year we identified the areas we needed to improve in order to deliver our strategy – cost, complexity, capital and trust from our customers. The energy and resolve of our people have resulted in significant progress on each, and we have delivered on the goals we set for 2014.”

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