Royal Bank of Scotland is expected to incur a 300m-pound one-off charge in relation to IT breakdowns at Natwest and two mis-selling scandals.
According to an exclusive report by Mark Kleinman, the City Editor of Sky News, the bank will reveal details of the financial impact from these issues on Friday when it releases its first-half results.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
In regards to the payment protection insurance (PPI) mis-selling scandal, the bank is expected to increase its provisions for compensating victims by around £130m, taking the total hit to £1.2bn, of which the rest was recognised in the lender's results last year.
Meanwhile, the provisions for compensating small businesses that were wrongfully sold expensive interest rate hedging products is thought to total £50m. Barclays, meanwhile, revealed last week that it took a £450m hit in the first quarter for that issue.
Shares were trading 5.23% lower at 204.13p by 14:37 on Thursday, pressured down further by rumours that the government, which already owns an 83% stake, is considering nationalising the bank in an effort to kick-start lending to businesses.
BC
-
How to pay in a chequeReceiving or writing a cheque has become much less common in recent years as instant bank transfers have grown in popularity. Amid widespread bank branch closures, we explain what to do if you get a cheque, and how you can pay one into your bank account.
-
Crypto assets of seven million UK investors at risk – how to keep yours safeCryptocurrency wallet rules make it hard to track down assets after someone has died, even if they leave a will saying who they would like to inherit them
