RBS to cut more jobs and branches, says Chairman

Royal Bank of Scotland (RBS) Chairman Philip Hampton on Tuesday signalled further job cuts and said it would take another 18 months to improve the bank's capital position enough to please regulators.

Royal Bank of Scotland (RBS) Chairman Philip Hampton on Tuesday signalled further job cuts and said it would take another 18 months to improve the bank's capital position enough to please regulators.

At the 81% state-owned bank's highly anticipated annual general meeting, Hampton outlined the company's strategy to turn business around after a "chastening" 2012 when it lost £5.2bn.

He said the bank, which has announced 37,000 job cuts since its taxpayer bailout in 2008, will axe more employees and close additional branches before its restructuring is complete.

"We've got to have our branches where our customers are, not always where we have had them for decades," Hampton said at the meeting, according to Bloomberg.

"We have work to do over the coming years to get our business in the right shape to deliver these ambitions, and that could mean further impacts on employees."

Hampton told shareholders the bank still has a while to go to boost its capital enough to keep regulators content.

In March, Britain's financial regulator said UK banks must raise £25bn of extra capital by the end of the year to absorb any future losses on loans.

Hampton added that the bank's restructuring should be mostly finished in 2014, enabling it to return to the private sector.

"We have the ambition of putting the government in a position to sell the shares towards the end of 2014. Then it is the government's decision," Hampton was cited by Reuters as saying.

He also said the bank would invest an extra £450m to improve its computer systems, on top of the £2.0bn it spends annually.

It comes after an IT meltdown last summer which locked up to 17m customers out of their accounts which sparked an investigation by the Financial Conduct Authority.

RD

Recommended

Ocado faces a “crunch” year – should you buy or avoid?
Share tips

Ocado faces a “crunch” year – should you buy or avoid?

Ocado was one of the big winners from the pandemic as customers moved online. But now it’s struggling, and losses are growing. So, asks Rupert Hargrea…
27 May 2022
What to buy as the tech-stock bull market crashes
Tech stocks

What to buy as the tech-stock bull market crashes

The decade-long bull market in tech stocks has come to a rapid halt. Investors need to distinguish solid stocks from speculative ones rather than just…
27 May 2022
Share tips of the week – 27 May
Share tips

Share tips of the week – 27 May

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
27 May 2022
Marks & Spencer shares look cheap – should you buy in?
Retail stocks

Marks & Spencer shares look cheap – should you buy in?

Marks & Spencer shares have been a disappointment for investors for two decades. But with the company now on something of a comeback, Rupert Hargreave…
25 May 2022

Most Popular

The world’s hottest housing markets are faltering – is the UK next?
House prices

The world’s hottest housing markets are faltering – is the UK next?

As interest rates rise, house prices in the world’s most overpriced markets are starting to fall. The UK’s turn will come, says John Stepek. But will …
23 May 2022
The Federal Reserve wants markets to fall – here’s what that means for investors
Stockmarkets

The Federal Reserve wants markets to fall – here’s what that means for investors

The Federal Reserve’s primary mandate is to keep inflation down, and lower asset prices help with that. So, asks Dominic Frisby – just how low will st…
25 May 2022
Scottish Mortgage Investment Trust has fallen hard. But is now the time to buy?
Investment trusts

Scottish Mortgage Investment Trust has fallen hard. But is now the time to buy?

After a spectacular couple of decades, the Scottish Mortgage Investment Trust has fallen by almost 45% so far this year. Rupert Hargreaves asks if no…
26 May 2022