CEO 'sorry' over Scots HQ remark

NatWest RBS posts loss, plans dividend, Coutts slides

RBS and Alison Rose

Alison Rose: ‘strong progress’

NatWest (RBS) has announced an operating loss of £351 million for the year and an attributable loss of £753m but will restore its dividend as CEO Alison Rose says the underlying business remains strong.

The operating loss for the year to the end of December 2020 compares to a profit of £4.23 billion in the previous year.

It reported a £2.9bn operating profit before tax and £3.2bn impairment charge set aside for bad loans. The bank proposes a final dividend for FY’20 of 3p per share. Of the £364m total payout £225m will go to the UK Government.

The bank has confirmed that its Ulster Bank subsidiary will withdraw from the Republic of Ireland. Ulster Bank’s business in Northern Ireland is unaffected.

Asked in a radio interview this morning if the bank is still “Scottish” following its re-brand last year, Ms Rose said: “Scotland is a hugely important part of our business”.

Later, in a conference call with the media, Daily Business asked if this meant Edinburgh was now just an outpost of a London-based bank and if this would now be “formalised”.

She said she apologised if her comments were misconstrued to suggest Edinburgh was no longer the head office.

“There is no change to our head office,” she said, adding that RBS supports one in three businesses in Scotland, one in five people and one in seven households. “We are one of the largest private sector employers in Scotland. I was emphasising how important Scotland is to us,” she said.

She was asked twice about the future of Edinburgh-based private bank Adam & Co which is said to be up for sale, but replied: “I have no comment on that.”

On the future of the company’s offices she said: “It will not go back to where it was before. We are looking at a hybrid approach.”

Chairman Howard Davies said there were no plans to repeat last year’s decision by the board to take voluntary pay cuts in view of the pressures caused by the pandemic. The bonus pool is a third lower than in 2019.

Coutts and Adam & Co slide

Profits at the private banking arms Coutts and Adam & Co slid 30% as NatWest wrote-down £100m on the expected hit from Covid-19.

The division saw profit fall from £297m to £208m as it warned about the ‘deterioration of the economic outlook’.

Revenue fell slightly from £777m to £763m, while operating expenses fell 6.4% to £455m.

CEO statement

In the statement on the annual figures, Ms Rose said: “The past year presented some extraordinary challenges for our customers, colleagues and communities. 

“We provided exceptional levels of support to those who needed it, including the approval of over £14 billion of lending under UK Government schemes.

“Despite reporting a loss for the year, NatWest Group delivered a resilient underlying performance in a challenging operating environment.

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