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RBS posts $A11 billion loss

Press Association logoPress Association 24/02/2017

Royal Bank of Scotland (RBS) has reported a STG7 billion ($A11 billion) annual loss, its ninth consecutive year in the red.

Analysts expected the bank to report losses of around STG5 billion, as its margins continue to be squeezed by record-low interest rates.

Friday's figures take into account STG10 billion in legacy costs, including STG5.9 billion on conduct charges and a STG2.1 billion restructuring hit.

The group revealed recently it had set aside another STG3.1 billion ahead of an expected fine from US authorities - linked to the sale of mortgage-backed securities - which was included in the bank's results.

RBS has now notched up losses totalling more than STG50 billion over the past eight years.

To compound matters, chief executive Ross McEwan has ordered a STG2 billion cost-cutting drive, expected to result in the loss of thousands of jobs.

It will include STG750 million of savings in 2017.

McEwan said: "The bottom-line loss we have reported today is, of course, disappointing but, given the scale of the legacy issues we worked through in 2016, it should not come as a surprise.

"These costs are a stark reminder of what happens to a bank when things go wrong and you lose focus on the customer, as this bank did before the financial crisis."

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