Royal Bank of Scotland (RBS.L) swung to a third-quarter loss on Friday, hit by costs related to past misconduct and restructuring, casting fresh doubts on when the government might begin to recoup more of its 2008 emergency investment.
The Edinburgh-based bank, more than 70 percent owned by the British taxpayer, reported a loss attributable to shareholders of 469 million pounds, compared with a profit of 952 million pounds in the same period last year.
That was more than twice the 231 million pounds loss estimated by analysts, according to a poll supplied by the bank.
It also said it would miss an end-2017 deadline to sell its Williams & Glyn branch network, a condition of its 2008 state rescue.
Chief Executive Ross McEwan is in the midst of a vast, multi-year restructuring of the bank, which includes asset sales, job cuts and multi-billion dollar charges to settle litigation and pay fines for historic regulatory breaches.
The losses were partly driven by a fresh 425 million pound misconduct charge and a rise in third quarter impaired loans to 144 million pounds.
The bank also reported 469 million pounds of additional restructuring costs, largely as a result of its extended struggle to sell Williams & Glyn.
But unlike rivals Lloyds Banking Group (LLOY.L) and Barclays (BARC.L), RBS did not record any provisions for repaying customers mis-sold payment protection insurance after taking a 450 million pound charge in the last quarter.
The bank reported higher than expected adjusted income of 3,494 billion pounds for the three months to end-September, reflecting efforts to step up lending to maintain its status as Britain’s biggest corporate lender.
RBS, which succumbed to a 45.5 billion-pound state bailout during the 2007-09 financial crisis, has not made an annual profit since 2007. The government is currently sitting on a 25 billion pound-plus loss on its investment.