PPI and Greek debt drag down RBS

published 23 February 2012

Provisions for mis-selling of payment protection insurance schemes and Greek debt ensured part-nationalised lender Royal Bank of Scotland made a pre-tax loss in 2011, though the core business was profitable at the operating level.

"RBS Core profits - the ongoing bank - were £6bn, comparing well with others and representing a return on equity of 10.5%. The reduction in our balance sheet since 2008 now exceeds £700bn with all other 'safety' measures improving strongly," said Group Chief Executive Stephen Hester.

The loss before tax for the full year was £766m, after the company set aside £850m for payment protection insurance costs and took a £1,099m write down on its sovereign debt holdings. In 2010, the bank made a pre-tax loss of £399m.