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RBS Still On Track For Aluminum Unprofitability Anniversary

The Scots are not quite ready to make money again.
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See page for author [Public domain], via Wikimedia Commons

Not ready to lose this feeling just yet. See page for author [Public domain], via Wikimedia Commons

The Royal Bank of Scotland is on the road to recovery. A $5.5 billion fine here, maybe a $12 billion fine there, many smaller payouts to settle smaller lawsuits related to the same big £25 billion mortgage-backed securities bonanza that got it into this problem in the first place, and next thing you know RBS will be back to being a normal bank, one that isn’t three-quarters owned by British taxpayers and one that is able to pay dividends to whoever takes their place, as well as more fines for more wrongdoing as yet undone or uncovered.

All of this is good news for CEO Ross McEwan and for those British taxpayers, who are still £30 billion underwater on their RBS “investment.” But it does put one of Wall Street’s most incredible streaks—up there with Cal Ripken’s consecutive games run or the Celtics’ eight championships in a row—in mortal jeopardy: RBS has lost money for nine straight years.

Luckily, thanks to the FHFA and Justice Department, that streak has at least one year left to run.

Top of the remaining list is that the lender has not made a profit since its government rescue. RBS is set to report its tenth successive net annual loss for 2017 at the start of next year. But Mr McEwan said he is aiming to post the bank’s first full-year profit for 2018.

RBS takes a step toward full health but road ahead is long [FT]


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