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

Get healthy returns from these three healthcare stocks
Share tips

Get healthy returns from these three healthcare stocks

Professional investor Paul Major of the BB Healthcare Trust highlights three of his favourite healthcare stocks.
25 Oct 2021
Share tips of the week – 22 October
Share tips

Share tips of the week – 22 October

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
22 Oct 2021
Three dividend stocks from the dynamic Asia/Pacific region
Share tips

Three dividend stocks from the dynamic Asia/Pacific region

Professional investor Sat Duhra of the Henderson Far East Income investment trust highlights three of his favourite stocks.
18 Oct 2021
Share tips of the week – 15 October
Share tips

Share tips of the week – 15 October

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
15 Oct 2021

Most Popular

Properties for sale for around £1m
Houses for sale

Properties for sale for around £1m

From a stone-built farmhouse in the Snowdonia National Park, to a Victorian terraced house close to London’s Regent’s Canal, eight of the best propert…
15 Oct 2021
How to invest as we move to a hydrogen economy
Energy

How to invest as we move to a hydrogen economy

The government has started to roll out its plans for switching us over from fossil fuels to hydrogen and renewable energy. Should investors buy in? St…
8 Oct 2021
Emerging markets: the Brics never lived up to their promise – but is now the time to buy?
Emerging markets

Emerging markets: the Brics never lived up to their promise – but is now the time to buy?

Twenty years ago hopes were high for Brazil, Russia, India and China – the “Brics” emerging-market economies. But only China has beaten expectations. …
18 Oct 2021