RBS has posted an attributable loss of £6.95bn for the year ended 31 December 2016, compared with a loss of £1.98bn a year ago.
The bank said that the results includes litigation and conduct costs of £5.87bn, restructuring costs of £2.10bn, the final Dividend Access Share (DAS) dividend of £1.19bn and Capital Resolution disposal losses and impairments of £825m, as well as a £300m deferred tax asset impairment.
The banking group posted an operating pre-tax loss of £4.08bn, compared to a loss of £2.70bn in the prior year. Adjusted operating profit declined 17% to £3.67bn.
Net interest income remained almost flat at £8.71bn, while total income dropped 2.5% to £12.59bn from £12.92bn. Operating expenses dipped 1% year-on-year to £16.19bn, while adjusted operating expenses dropped 12% to £1.13bn.
The group’s private banking unit reported operating profit of £111m for the year ended 31 December 2016, compared with an operating loss of £470m in 2015. Adjusted operating profit at the unit was £149m, a 32% surge from £113m a year earlier.
The unit’s total income rose 2% to £657m from £644m a year ago, while adjusted operating expenses slumped 1% year-on-year to £511m.
Compared to the last year, the private banking unit’s net loans and advances increased £1bn to £12.2bn. Assets under management stood at £17bn at the end of 2016 as against £13.9bn a year ago.
Commenting on the results, RBS CEO Ross McEwan said: “The bottom line loss we have reported today is, of course, disappointing but given the scale of the legacy issues we worked through in 2016, it should not come as a surprise. These costs are a stark reminder of what happens to a bank when things go wrong and you lose focus on the customer, as this bank did before the financial crisis.
“We made good progress throughout 2016 against our strategy. Our core business generated £4.2bn in adjusted pre-tax operating profit for the year – that’s an average of £1 billion per quarter for the last eight quarters.”