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 Post subject: Royal Bank of Scotland set to announce £5bn loss
 Post Posted: Wed Feb 24, 2010 10:02 pm 
Smashing neocons
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Posts: 1782
Location: UK
The Royal Bank of Scotland (RBS) will announce losses for 2009 of about £5bn later, after it struggled with billions of pounds of bad loans.

The bank, which lost £24bn in 2008, is also expected to reveal it will pay a total of £1.3bn in bonuses to staff.

The UK taxpayer owns 84% of RBS after the government bailed out the bank at the end of 2008.

RBS is the second major UK bank to report 2009 results, after Barclays announced record profits of £11.6bn.

Unlike RBS, and Lloyds Banking Group, Barclays did not take any money directly from the government to help it through the financial crisis.

Lloyds - also part-owned by taxpayers - will release its results on Friday.

Ruined reputation

Announcing losses of about £5bn is usually career-ending for a company's chief executive, but RBS boss Stephen Hester will be trumpeting the figure when the bank publishes its annual results at 0700 GMT.

Compared with a loss of £24bn in 2008, anticipated losses of a fifth of that appear to be a major turnaround.

Not that Mr Hester will be rewarded greatly for his efforts as he has already declined to take up his anticipated bonus, worth almost £1.6m.

When Mr Hester took the helm of RBS in October 2008, the world's sixth-largest bank at the time was imploding under the weight of its own reckless investments.

His new charge had just been all but nationalised, its reputation in ruins, and Britain was in the midst of the longest and deepest recession on record.

But, blessed with £200bn of quantitative easing from the Bank of England, RBS, alongside most other banks, managed to turn a nightmare 2008 into a busy 2009.

While it is pleasing that a bank 84%-controlled by taxpayers will have dramatically cut its losses, it will irritate quite a few that RBS is set to pay out bonuses worth more than £1.3bn to its investment bankers.

That will be unpalatable for the thousands of firms and individuals who were refused credit by RBS last year.

Then again, the staff at the Edinburgh-based bank are getting used to being blamed for almost everything.

Government intervention

Depending on the pressure group, they should not have funded Kraft's purchase of Cadbury. They should not have acted on behalf of the Kingsnorth coal plant. And they should not have indirectly invested in Burma.

Next year may turn out to be the one in which RBS does its time and gets paroled. It will start the sell-off process of RBS branches in England, its insurance business (Green Flag and Churchill) in the UK and multiple businesses overseas.

In the meantime, RBS's investment banking division - the part of the bank that nearly destroyed it - has been holding its own in the market under intense political and commercial pressure.

Commercially, RBS is not in a position to do very much without the blessing of UK Financial Investments (UKFI) - the government body that runs taxpayers' stakes in banks such as RBS, Lloyds Banking Group and Bradford & Bingley.

Unless the bank can start making a profit, however, it will have to put up with that for another year at the very least.

When false religion is established, when all avenues of protest are closed, when potential revolutionaries are bribed, coopted or killed, then Hussein's model teaches man to be a martyr, and by his death witness to the truth and shake the evil empire:

"It is an invitation to all ages and generations that if you cannot kill, die".

- Ali Shariati

 Post subject: Re: Royal Bank of Scotland set to announce £5bn loss
 Post Posted: Thu Feb 25, 2010 11:59 am 
Super Anti-Neocon
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Jim Rogers called that one

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