Royal Bank of Scotland posts first profit in a decade

The bank’s symbolic return to profit after its £45.5 billion bailout during the height of the financial crisis will be overshadowed by this last large, looming fine for crisis-era misconduct. (Reuters)
Updated 23 February 2018
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Royal Bank of Scotland posts first profit in a decade

LONDON: Royal Bank of Scotland Group reported its first full-year profit since 2007 on Friday, but the symbolic moment was bitter-sweet for the bank which had hoped to get a multi billion-dollar misconduct charge out of the way instead.
The bank’s £752 million profit beat a company-provided average of analyst forecasts for a £592 million loss. But many had included in their estimates hefty provisions for a settlement with the US Department of Justice for misselling by RBS of toxic mortgage backed securities.
Some analysts put the charge as high as $12 billion. RBS had hoped to settle the case in 2017. If it had, this would have resulted in the bank’s 10th consecutive annual loss. Since 2008, RBS has booked £58 billion in losses.
The bank did not provide an update on the timing of the settlement, its last large remaining legacy issue.
Chief Executive Ross McEwan said in a statement this was out of the bank’s control but the bank could nonetheless begin to think about resuming payments of dividends or buying back its shares.
“With many of our legacy issues behind us, the investment case for this bank is much clearer and the prospect of returning any excess capital to shareholders is getting closer,” he said.
But for market watchers, the bank’s symbolic return to profit after its £45.5 billion bailout during the height of the financial crisis will be overshadowed by this last large, looming fine for crisis-era misconduct.
The issue weighs on RBS’s share price and complicates the government’s plan to sell down its 71 percent stake in the bank.
RBS took £764 million of provisions in the fourth quarter for conduct issues like its missale of payment protection insurance, which came in at £175 million.
Restructuring costs were £531 million for the quarter and £1.6 billion for the entire year.
Overall, the bank continued to drive down costs — a strategic aim that has seen it shed billions of pounds from the bank in recent years.
In 2017, it beat its overall cost reduction target of £750 million, taking out £810 million overall.


Stuck in an unwanted mobile contract? UAE cuts early termination fees

Updated 21 March 2019
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Stuck in an unwanted mobile contract? UAE cuts early termination fees

  • Telecom companies can now only charge a month worth of fee for early termination
  • The move comes as the UAE regulator observed multiple complaints from customers

DUBAI: Customers in the UAE who feel stuck in a phone contract due to massive early termination fees can now breathe, as the Emirate’s telecoms regulator has introduced a new policy.  

The Telecommunications Regulatory Authority (TRA) announced that telecom companies Etisalat and Du can now only charge one-month worth of fee for early termination.

The policy will apply to new mobile contracts, but the TRA said it is working to implement the same in other service contracts, as reported by UAE-based Arabian Business.

“We strive to hear the comments of the stakeholders on the operators’ services,” Hamad Obaid Al-Mansoori, TRA director general, said.

“We don’t hesitate to review any policies or regulations for the interests of the parties and the public,” he added.