RBS reported an operating profit of £255 million, and an attributable loss(1) of £469 million in Q3 2016 which included restructuring costs of £469 million, litigation and conduct costs of £425 million and a £300 million deferred tax asset write down.
Across Personal & Business Banking (PBB), Commercial & Private Banking (CPB) and Corporate & Institutional Banking (CIB) franchises, RBS reported an adjusted operating profit of £1,331 million. RBS has generated over £1 billion of adjusted operating profit across PBB, CPB and CIB in each quarter this year. Adjusted return on equity across PBB, CPB and CIB was 14% for Q3 2016.
Common Equity Tier 1 ratio of 15.0% increased by 50 basis points in the quarter and remains ahead of our 13.0% target. Leverage ratio increased by 40 basis points to 5.6% principally reflecting the £2 billion Additional Tier 1 (AT1) issuance.
Ross McEwan, RBS CEO said:
“Our core business results were good with a £1.3bn adjusted operating profit and a 14% return on adjusted equity. This is our best quarter for the core bank since 2014. The core business has now delivered on average over £1bn in adjusted operating profit for the last seven quarters.
The bottom line loss reflects continued progress in restructuring the business and addressing some of our legacy issues.
Our mortgage net lending is up £3.6bn in Q3. We are consistently growing market share, with a 12% share of new business compared to a stock share of 8.7%.
Across our core franchises, the strong lending performance in the first half of the year has stood us in good stead. We’re still comfortably on track to surpass our lending target for the year in Personal & Business Banking and Commercial with lending of 9%, above our 4% target.
We’ve said previously that this is a noisy part of our strategic plan and it continues to be so.”
(1) Attributable to ordinary shareholders.
Conference call replays
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Q3 Results 2016 Press Conference transcript (137KB PDF)