txstockhound
10年前
Suckers! As we say in Texas. MRBS (Em, Are Bu** Sh**).
First they RBS only had enough equity to settle 60% of the claims against them (costing them something like $800 million). For the rest they intended to sell additional stock. Which they canceled because their stock price was too low.
Second, sure they have a lot of cash around that could go to dividends. But it won’t because it’s all going to the partial settlement.
Third, they got in trouble in 2008 because they had to raise emergency cash. Look for them to end up back in trouble again because well, they could only settle 60% of their lawsuit, they need cash to operate and they have negative earnings, they need to settle the remainder of their lawsuit. So, this is an RBS (Ridiculous Stock Buy).
Fourth, They are projecting NEGATIVE 70% EPS growth. Which would be bad if you believed the $0.1 EPS reporting above. My broker is telling me the actual EPS is (NEGATIVE) -$0.02 so if you bought this stock as a dividend target you are indeed bought yourself an RBS (Rock bottom Sh**ter).
RBS as we say in Texas (Real Bu** Sh**).
conix
10年前
And The Biggest Loser From The UK's "Falling Dominoes" Is…
Now that not just 3 (as of last night) but 5 UK property funds, with Henderson and Columbia Threadneedle became the latest two entrants to this exclusive club of clueless asset managers who have no idea how to factor in liquidity mismatch during market stress, have “frozen” their assets and gated investors from accessing assets, concerned traders are wondering how far the downstream effects of this domino chain will go. Luckily, overnight analysts at Morgan Stanley, JPM and SocGen did the math and found what they believe is (are) the most impacted bank(s) from UK’s commercial real estate troubles.
Here is the verdict, first from SocGen:
RBS exposure to CRE is GBP26b, most of U.K.’s major banks, and equivalent to 63% of tangible equity
Lloyds 2nd most exposed at 46% of tangible equity, Santander 3rd at 24%, Barclays 4th at 23% and HSBC 5th at 17%
U.K. banks debt financing of CRE is down 34% since 2008 to GBP168b, according to De Montfort University
Says watch out for other banks, challenger banks have relatively high proportion of more highly leveraged CREs on books
Lloyds is most preferred, will be able to absorb Brexit bumps; RBS is least preferred
Next, from JPM:
RBS, Lloyds and Bank of Ireland are more exposed to risks from U.K. commercial property prices than Barclays, HSBC and Standard Chartered
RBS, Lloyds TNAV sensitivity in stress scenario may be up to 5.5% with CT1 sensitivity at 90bps-100bps
Major U.K. banks’ exposure is GBP69b
Is “cautious” on U.K. domestic-exposed banks
U.K. lenders exposure is GBP86b down from GBP150b in 2011
Flags BOE remarks that U.K. challenger banks have high proportion of more highly leveraged commercial real estate loans
Says BOE research shows 10% drop in U.K. CRE prices leads to 1% drop in economy-wide investment
Finally, Morgan Stanley is outright negative on everything:
Morgan Stanley analysts see potential for further stress with GBP25b-40b of AUM in property funds, or 2-5% of total U.K. mutual fund assets, according to note.
Outflows are always high when REIT discounts are wide, whilst Henderson, Aberdeen and Schroders have some exposure among asset managers
Number of redemption requests normally correlated with discount to NAV for listed property stocks, currently close to historical wides
Fund suspensions designed as circuit-breakers, but sentiment generated can still drive negative feedback loop similar to that seen during last financial crisis
Liquidity mismatch the main concern:
Liquidity of investment funds is a significant concern for global regulators, particularly where illiquid underlying investments are being sold in daily dealing fund structures to retail investors
* * *
The conclusion: Italy has Monte Paschi, Germany has Deutsche Bank, and the UK is now saddled with RBS.
At this rate, all three will soon require taxpayer bailouts. Just remember: it’s all Brexit’s fault that 7 years after the financial crisis, not a single of Europe’s most systemically important banks were actually “fixed.”
conix
10年前
Lloyds, RBS CEOs reassure staff on strength after Brexit vote
LONDON | By Sinead Cruise and Andrew MacAskill
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A woman uses a cash machine at a Lloyds Bank branch in central London, Britain February 25, 2016.
Reuters/Paul Hackett
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The chief executives of Lloyds Banking Group (LLOY.L) and Royal Bank of Scotland (RBS.L) moved to reassure thousands of workers that their state-backed companies would weather the turmoil sparked by Britain's decision to quit the European Union.
In separate memos sent to staff on Tuesday, Lloyds CEO Antonio Horta Osorio and RBS CEO Ross McEwan thanked staff for executing contingency plans effectively in the wake of Friday's historic result and for keeping focus on customers while sterling, stock and bond markets plummeted.
But RBS boss McEwan warned staff that Britain's decision to leave the EU has caused a range of economic uncertainties "in the short, medium and long term". RBS said on Friday it had no current plans to change where or how it operated following the vote..
The lenders -- both part-owned by the UK government since taxpayer bailouts in 2008 - saw their stock prices plunge in the two trading days following Friday's result, as investors rattled by talk of a deep recession and a string of earnings downgrades dumped bank stocks in droves. [L8N19J21X]
"We did what we do best on Friday," Horta Osorio said in the memo.
"We had robust plans in place for either outcome, and I have been immensely proud of everyone who ensured that they were delivered smoothly," he said.
Horta Osorio, who is Portuguese and has led the bank since 2011, said the bank's low-risk lending approach and historic brands had put Britain's biggest mortgage lender in a position of strength "to weather turbulence in our sector and the wider market".
McEwan, a New Zealander, noted that the result had rippled beyond markets and into "everyday exchanges between colleagues, friends and family" but called on RBS employees to remember how diversity was a major contributor to the bank's success.
"As someone born outside the UK, I see one of this country's biggest strengths as its openness to the rest of the world, and the people of it. As a major employer and backer of the economy we have a duty to ensure that we reflect that," he said.
STAKE SALES
While both executives claimed the fundamental strengths of their banks were unaffected by the vote, prospects of swift return to full private ownership have taken a significant knock.
Sources close to Britain's government say it has shelved plans to sell stakes in both banks for the rest of the year because market volatility has made it too difficult to judge whether disposals represent fair value for taxpayers. [L4N19J4BO]
The Treasury had planned to further reduce its exposure to the banks it took over during the financial crisis, by raising 9 billion pounds via sales of stock to fund managers and a discounted offer to the public.
"It is going to take quite a while for us to understand the implications for the banks before we could even consider starting to sell," one of the sources said.
Lloyds shares, which have fallen more than 25 percent since the beginning of the year, rebounded 6.7 percent to trade at 54.7 pence at 1400 GMT, almost 20 pence off the government's so-called break-even price.
RBS shares, which have fallen by more than 27 percent in the three days since the Brexit decision, gained 3 percent by 1400 GMT.
conix
10年前
Barclays, RBS, Lloyds Slammed by Second Day of Brexit Fallout
June 27, 2016 20:39 GMT
barclays BCS
Barclays PLC (NYSE:BCS) is one of the British banks hit the hardest by last week’s historic Brexit vote, with its shares trading 37 percent lower than the stock’s price before it was announced that the United Kingdom would leave the European Union. The unexpected voting results immediately sent global markets into a chaotic state of volatility, and British banking groups – in particular – took the blunt of the impact.
The main sell-offs in the market on Friday, and continuing into Monday, are in the European financial sector – and Britain’s big banks are getting the worst of it. Both Barclays and Royal Bank of Scotland Group Plc (NYSE:RBS) had their stock halted today, after the banks’ shares dropped to their lowest levels since the financial crisis. Once their shares fell more than eight percent, circuit breakers were triggered to stop all trading of the common shares.
Barclays is down 21 percent since the market open today, RBS is down by 12 percent and Lloyds Banking Group plc (NYSE:LYG) has plunged by 18 percent. Despite the various British banks’ stock gaining in value in the days leading up to the surprising vote, the voters’ decision drove the market values of these giant financial institutions 13 percent lower – on average – in a matter of days.
At least six Wall Street analysts have slashed their ratings on the three banks mentioned above. Jefferies, for instance, cut its earnings prediction for Barclays, RBS and Lloyds into 2018, expecting “tectonic plate shifts in European bank investing.” Jefferies’ Joseph Dickerson, while not giving any predictions on the details of these shifts, said that the current state of uncertainty about Britain’s future “creates an information vacuum and is likely to impair investment appetite in the U.K.”
U.K. banks were not the only ones touched by the ripple effects of the historic Brexit. Deutsche Bank (NYSE:DB), Germany’s universal banking giant, is down six percent. Switzerland-based Credit Suisse (NYSE:CS) is trading nearly nine percent lower today, and UBS (NYSE:UBS) – also a Swiss banking group – has dropped by more than eight percent since the market open this morning.
The hysteria surrounding the Brexit can be felt almost everywhere. European stock indexes dropped yet again today. The FTSE 100 fell by over three percent, and major averages in Germany, Italy and France sunk by more than two percent. The sell-off was not contained within Europe, however, as the DOW is down 1.65 percent and the S&P 500 has tumbled by just under two percent.
The impact on the British pound (GBP) is also a major factor in the beating that British banks have taken since the Brexit results sunk in. The UK’s currency has dropped another four percent to just $1.32 today. According to George Soros, who forecasted a drop in the value of the GBP if the voters approved leaving the European Union, is warning that the whole EU is going to unravel.
Some, however, are embracing a calmer outlook. The British Chancellor of the Exchequer, George Osborne, attempted to reassure Britons as the hectic market absorbed the Brexit announcement. In his first remarks after the voting results came in, Osborne said today: “You should not underestimate our resolve. We were prepared for the unexpected.”
mlkrborn
13年前
RBS settled with fine, 6 dismissals. $10s today.
RBS Pays $612.6M in Fines to US, UK Regulators
Last update: 2/6/2013 8:17:14 AM
By Max Colchester
LONDON--Royal Bank of Scotland Group PLC (RBS) said Wednesday that it paid $612.6 million in fines to U.S. and U.K. regulators over allegations that the bank sought to rig interbank lending rates, the third lender to be punished in a global probe into rate fixing.
In a statement, RBS said that it settled with the U.K. Financial Services Authority, the U.S. Commodity Futures Trading Commission and the U.S Department of Justice around allegations that traders attempted to manipulate a series of benchmark interest rates, including the London Interbank Offered Rate, or Libor.
The bank agreed to pay of GBP87.5 million to the FSA, $325 million to the CFTC and $150 million to the DoJ to resolve the investigations.
As part of the agreement with the Department of Justice, RBS entered into a Deferred Prosecution Agreement in relation to one count of wire fraud and one count for an antitrust violation.
RBS said that wrongdoing was predominantly linked to 21 employees. All these employees have either left the bank or been disciplined, the bank said.
RBS also said that investment banking chief John Hourican would leave the bank, despite having no role in the alleged rigging of rates. None of the regulators concluded that RBS, as a company, had engaged in any deliberate misconduct, the bank added. RBS said that there were no findings to suggest that senior management at the bank looked to artificially lower submissions.
The findings broadly centered on RBS's setting of the yen, Swiss franc and U.S. dollar submission, RBS said.
"The RBS Board acknowledges that there were serious shortcomings in our systems and controls and also in the integrity of a small group of our employees," RBS Chairman Philip Hampton said in a statement. "This is a sad day for RBS, but also an important one in continuing to put right the mistakes of the past."
(END) Dow Jones Newswires
February 06, 2013 08:43 ET (13:43 GMT
mlkrborn
14年前
Deutsche Bank Downgrades RBS To Hold
Last update: 2/3/2012 5:11:35 AM
1011 GMT [Dow Jones] Deutsche Bank downgrades Royal Bank of Scotland (RBS.LN), citing the 40% price rally year-to-date, and 30% rally since August 2011. "Despite thinking that RBS management are doing a solid job of re-shaping the bank into a more stable, attractive ROE, predominantly UK-based institution, we are concerned that it runs out of P/E-valuation upside long before the other two UK domestic banks, Barclays (BARC.LN) and Lloyds Banking Group (LLOY.LN)," both rated at buy. FY11 results due Feb. 23 should show core pretax profit of GBP6.3 billion ex-own debt, says DB. 30p target. Shares down 0.1% at 28p. (michele.maatouk@dowjones.com)
mlkrborn
15年前
ADR Report-European banks lead broad sell-off
NEW YORK, Sept 6 | Tue Sep 6, 2011 10:58am EDT
NEW YORK, Sept 6 (Reuters) - U.S.-listed shares of European lenders tumbled on Tuesday as renewed concern with the ability of governments to solve the debt crisis grips the region's banking system.
European shares slumped, with banks hitting a 29-month low on worries about the political handling of the euro zone debt crisis. A regional index of European bank stocks .SX7P fell 2.9 percent and is down nearly 12 percent so far in September. For details see [.EU].
UBS (UBS.N) fell 11.9 percent to $12.61 and Barclays (BCS.N) slumped 9.5 percent to $9.59 in New York, while HSBC Holdings (HBC.N) dropped 4.7 percent to $40.40 and Spain's Banco Santander (STD.N) lost 7.9 percent to $7.90. RBS (RBS.N) lost 14 percent to $6.82 and Credit Suisse (CS.N) fell 13.8 percent to $23.59.
Investors worry that some of these banks have high exposure to sovereign debt from countries whose debt levels could be spiraling out of control. Concerns over whether Greece will receive its next aid tranche took center stage again.
The BNY Mellon index of leading American Depositary Receipts (ADRs) .BKADR was down 4.3 percent, while the U.S. benchmark S&P 500 index .SPX dropped 2.8 percent.
The BNY Mellon index of leading Asian ADRs .BKAS fell 3.2 percent, while the BNY Mellon index of leading European ADRs .BKEUR lost 5 percent.
The BNY Mellon index of leading Latin American ADRs .BKLA lost 4 percent. (Reporting by Rodrigo Campos; Editing by Theodore d'Afflisio
mlkrborn
15年前
RBS Govt-Insured Assets Perform Better Than Expected - APA
6:58a ET July 14, 2011 (Dow Jones)
RBS Govt-Insured Assets Perform Better Than Expected - APA
LONDON (Dow Jones)--The U.K. government Thursday said it expects to make GBP5 billion from an insurance policy on banks' risky assets, mainly in the form of fees from part state-owned lenders Royal Bank of Scotland Group PLC (RBS) and Lloyds Banking Group PLC (LYG).
The Asset Protection Agency, or APA, the government body managing the program, said in an annual report the program is "well on course" to make profit without ever having to pay out. It estimated that losses on RBS' insured assets over the life of the policy will total GBP45 billion, down from the GBP57 billion forecast in 2010, and well below the GBP60 billion first-loss piece covered by RBS.
The APA said the RBS insured asset pool now stands at around GBP182 billion, after assets matured.
RBS took out the insurance policy on about GBP286 billion of its riskiest assets in late 2009, as part of a government bail-out. It pays about GBP700 million a year in premiums, going down to GBP500 million in 2012. So far, it has paid GBP2.1 billion in premiums.
Lloyds in early 2009 had agreed to have some of its assets insured but ultimately didn't need the program. It paid a GBP2.5 billion fee to cover the implicit guarantee it enjoyed before dropping out.
-By Margot Patrick, Dow Jones Newswires; +44 (0)20 7842 9451; margot.patrick@dowjones.com
(END) Dow Jones Newswires
07-14-11 0658ET
Copyright (c) 2011 Dow Jones & Company, Inc.BT201107140023432011-07-14 10:58:00.0004NQ34290G0KTUUJ7IGPRGNLHMTDJNF
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mlkrborn
15年前
AT A GLANCE: UK Bank 1Q Earnings Hit By PPI, Regulatory Charges
Last update: 5/9/2011 7:58:10 AM
THE NEWS: HSBC Holdings PLC (HBC) wrapped up the U.K. banks' first-quarter earnings Monday with a disappointing set of results that highlighted the challenges for new Chief Executive Stuart Gulliver to improve the bank's revenue and cuts its costs.
It also weighed in on how much it expects to repay to customers mis-sold payment protection insurance on mortgages and other loans, after Lloyds Banking Group PLC (LYG) shocked the market last week with a GBP3.2 billion provision.
HSBC set aside $440 million and Barclays PLC (BCS) Monday said it is earmarking GBP1 billion to PPI customers.
It was largely a lackluster quarter for the country's banks, with only Asia-focused Standard Chartered PLC (STAN.LN) pleasing the market with record income.
BARCLAYS, reported April 27: First-quarter net profit slipped to GBP1.01 billion from GBP1.067 billion amid a sharp fall in revenue at its Barclays Capital investment-banking unit. Bank executives said uncertainty over coming regulatory requirements is hindering dividend growth, and that reducing credit exposure will be a priority to curb the effects of higher capital charges from 2013 on risky assets.
Barclays said the U.K. bank levy charge will be about GBP100 million for the first quarter. On May 9, it said it is provisioning GBP1 billion for PPI customers.
SANTANDER UK, reported April 28: The U.K. arm of Spain's Banco Santander SA (STD), said higher regulatory and liquidity costs hit profit, for a 2% fall in first-quarter net profit from a year earlier, to GBP419 million. It said it has had to pay more to replace maturing debt, and is holding GBP30 billion more in liquid assets than it did 15 months ago because of tougher liquidity regulation. The bank said it is paying out PPI claims as they arise and doesn't need to make a provision.
STANDARD CHARTERED, reported May 4: The U.K.-based, Asia-focused bank said it made record revenue in the first quarter, from double-digit growth in both retail and wholesale banking. Cost growth is still outpacing revenue growth but narrowing from 2010 levels. The bank repeated guidance that it aims to fully bridge that gap by the end of 2011. Hong Kong, India, Singapore, Malaysia and China all made strong contributions, the bank said. It never sold PPI products.
LLOYDS BANKING GROUP, reported May 5: The 41% state-owned bank made a surprise GBP3.2 billion provision to cover refunds to customers mis-sold payment protection insurance on mortgages, credit cards and personal loans, a higher figure than had been expected and putting pressure on its peers to drop a legal effort to stem costs. Because of the charge, as well as lower retail margins, the bank posted a GBP2.44 billion net loss in the first quarter, compared with a GBP169 million net profit in the first quarter of 2010. Attention is now on a strategic update due at the end of June from new CEO Antonio Horta-Osorio, who gave few clues Thursday on what it might hold.
ROYAL BANK OF SCOTLAND GROUP PLC (RBS), reported May 6: The bank's first-quarter loss widened from accounting charges and rising bad debts in Ireland, but its shares rose more than 3% Friday as investors and analysts took comfort from improvements in the bank's core divisions.
Group operating profit, stripping out tax, accounting charges and restructuring costs, was GBP1.05 billion in the three months--better than some analysts' expectations--compared with GBP882 million in the first three months of 2010. The 83% state-owned bank took GBP1.95 billion in impairments, down 27% from GBP2.68 billion and including GBP1.29 billion from its Ireland loan books. RBS still hasn't said what it might have to pay over PPI.
HSBC, reported May 9: The bank's costs soared in the first quarter from a series of one-off charges that included a $440 million provision over mis-sold payment protection insurance. However, net profit rose 58% as it took hefty tax credits in its U.S. business. Analysts said they were disappointed with flat revenue and a miss on pretax profit figures, and that they would probably revise their full-year estimates downward.
HSBC's cost-income ratio, or expenses relative to income, hit 60.9%, well above its target of around 52%. New CEO Gulliver on Wednesday will outline the bank's priorities and potential step-back from some countries and businesses. Europe and North America are seen as the biggest candidates for restructuring.
-By Margot Patrick, Dow Jones Newswires; +44 (0)20 7842 9451; margot.patrick@dowjones.com
(END) Dow Jones Newswires
May 09, 2011 07:58 ET (11:58 GMT)
mlkrborn
15年前
RBS reported: 0.43 p . 83 percent nationalized ;core business is profitable . Date: Friday 06 May 2011
LONDON (ShareCast) - Part-nationalised lender Royal Bank of Scotland made an underlying operating profit of more than £1bn in the first quarter but, unlike its sector peer Lloyds on Thursday, it has not made any provision for claims relating to mis-selling of payment protection insurance (PPI)'
“RBS continues to settle [PPI] claims where we believe that the customer has not been treated fairly or has suffered some detriment. However, a decision on appeal of the court case, led by the BBA [British Banking Association], has not yet been made as it relates to important other issues of retrospective regulation. The uncertainties around the outcome of the PPI action mean that, at this time, the group is unable reliably to estimate any potential financial liability, although it could prove to be material,” the group said.
RBS made an underlying first quarter operating profit of £1.05bn, up from £882m the year before.
Total income declined to £7.55bn from £8.21bn the year before, as market conditions were not so favourable this time round for the group's investment banking arm, Global Banking and Markets (GBM).
Impairments continued on a downward trajectory, falling 9% compared with the prior quarter to £1.95bn and 27% compared with the first quarter of 2010. Non-core impairments were 11% lower, reflecting the improving corporate environment, but with continued high impairment levels in Ireland. Core impairments also fell, with improvements in UK Retail and UK Corporate more than offsetting higher Ulster Bank impairments.
The group balance sheet continued to strengthen. Non-core third party assets (excluding derivatives) declined by £13bn during the quarter to £125bn, and the division remains on track to hit year-end targets.
The group loan:deposit ratio improved to 115%, driven largely by the continued deleveraging of the Non-Core division. Long-term issuance was £10bn in the quarter relative to a full year target of £20bn. The liquidity portfolio of £151bn remains in line with the group's target level.
The group's Core Tier 1 ratio, a key measure of balance sheet strength, improved by half a percentage point during the quarter to 11.2%. Gross risk-weighted assets, excluding the relief provided by the government's Asset Protection Scheme (APS), fell by £33bn to £538bn.
Loss before tax was £116m compared to £5m a year earlier, after a £480m write-down in the value of the group's own debt (Q1 2010: £169m) and a £469m (Q1 2010: £500m) hit relating to fair value changes in the group's APS involvement.
The loss attributable to shareholders widened to £528m from £248m.
“Core Retail & Commercial demonstrated continued momentum, reflecting both improving economic conditions and positive results from investment programmes, while GBM benefit......"
mlkrborn
15年前
RBS up $0.93 over $14.00s nw. 0.43 pound in london..New quarterly report up: Core business remain profitable. mis selling of insurance is less of an issue than LLOYD's.
UPDATE 4-RBS core profit jump offsets Irish losses
Related News
* UPDATE 4-Manulife profit dips on hedge costs, Japan quake
Thu, May 5 2011
* UPDATE 6-Lloyds takes $5.3bn hit for insurance mis-selling
Thu, May 5 2011
* Weaker banks push European shares to 2-week lows
Thu, May 5 2011
* Lloyds takes $5.3 billion hit for insurance mis-selling
Thu, May 5 2011
* Euro zone takes third debt crisis patient into care
Wed, May 4 2011
Analysis & Opinion
* More debt and inflation will not create economic prosperity
* Portugal’s bank rescue plan has one hole
Royal Bank of Scotland Group PLC
RBS.L
43.14p
+2.66+6.57%
11:24am EDT
Lloyds Banking Group PLC
LLOY.L
54.14p
+0.76+1.42%
11:24am EDT
Bank of America Corp
BAC.N
$12.44
+0.14+1.14%
11:24am EDT
Fri May 6, 2011 7:21am EDT
* Profits rise at RBS' core business
* Group attributable loss of 528 mln stg
* Too early for estimate on PPI insurance claims impact
* Remains unsure of timing on FSA probe into RBS
* Shares up over 6 pct, recovering from previous day's fall
(Adds further comment, detail, updates share price)
By Sudip Kar-Gupta
LONDON, May 6 (Reuters) - Royal Bank of Scotland (RBS.L) said profits were improving at its core business and hefty Irish loan losses would start to decline in the second half of the year, sending its shares higher.
RBS, 83-percent owned by the UK government following its bail-out during the credit crisis, had a first quarter group loss of 528 million pounds ($841.5 million) as the company racked up 1.3 billion pounds in bad debts at Ulster Bank.
But profits at its core business - namely its main retail and investment banking arms and excluding businesses due to be sold off - rose 25 percent from the final quarter of 2010 to 2.1 billion pounds, with profit margins also increasing.
"RBS is pulling off the recovery that we have targeted," Chief Executive Stephen Hester said on a conference call.
RBS shares were up 6.4 percent at 43.06 pence in early afternoon trade.
"Things are improving, albeit at a slowish rate," said Cavendish Asset Management fund manager Paul Mumford, who holds 3.75 million RBS shares.
Customers at RBS' Ulster Bank are struggling to pay back loans given tough economic conditions in Ireland. However, the total charge for bad debts -- 1.95 billion pounds -- fell 9 percent from the final quarter of 2010.
RBS said Irish loan losses would stay high this quarter before "gradually declining" in the second half of the year.
PROBLEMS AHEAD?
The bank faces other hurdles along its path to recovery.
The industry in Britain was rattled this week by Lloyds' (LLOY.L) shock 3.2 billion-pound charge to cover compensation for people sold insurance they could never claim or did not know they were buying. [ID:nLDE7432FG]
Lloyds' provision was made for payment protection insurance (PPI) complaints after banks lost a UK court case on the way policies were sold to millions of customers. The policies were typically taken out alongside a personal loan or mortgage to cover repayments if customers fell ill or lost their jobs [ID:nLDE73J18Y].
Bank of America (BAC.N) has also raised its provision for the insurance mis-selling to $650 million from an original $592 million.
RBS said the impact from settling these insurance claims could be "material" but it was too early to provide an estimate.
Analysts at Deutsche Bank and Exane BNP Paribas analysts said RBS could face a 1 billion pound hit because it has a roughly 10 percent market share in that sector. In total they said the PPI mis-selling debacle could cost British banks 8 billion pounds overall.
However, Berenberg Bank analyst Alexander Potter said the insurance mis-selling provision was less of an issue for RBS than for Lloyds, due to RBS' bigger size.
"A one billion pound hit on a group with a market capitalisation of some 44 billion pounds is relatively modest," he said. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^For BreakingViews on insurance mis-selling: [ID:nLDE7440JI] ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Also around the corner is a report by the Financial Services Authority (FSA) regulator into RBS' near-failure, which required the government to pump in 45 billion pounds.
Legal complications have held up publication of the report but on Thursday Britain appointed two senior corporate governance experts to ensure it will not be glossed over or stymied by legal rows. [ID:nLDE7441JL]
CEO Hester said the company remained keen for the report, which is being examined by its lawyers, to be published.
"We think it would be a good thing if a report is published, as there's a risk that people think there's some smoking gun. If there is, we haven't found it," Hester said.
Britain hopes to eventually sell off its RBS and Lloyds shares, but Hester said any disposal of the UK's RBS stake could remain some way off.
"I don't believe (the government), is preparing anything with a definitive eye....We've had no conversations with investors, specifically, with this in mind," he added.
($1=.6274 Pound)
mlkrborn
15年前
Loughtanian's of LSE take on earnings report:
"HL Comment (24 February 2011)
Part nationalised Royal Bank of Scotland published its full year results today (24th Feb 2011). The group, which is two years into a five year plan to restore the bank into good health, posted a net loss of £1.1 billion which was an improvement on the £3.6billion loss the bank made in 2009, and the £24.3billion loss in 2008. The improvement was driven by a sharp fall in losses on bad loans over the year, a resilient performance by its retail commercial businesses and a faster than expected reduction of non-core assets. Most of last year's loss was due to a large exceptional charge of £1.1 billion under the government's asset protection scheme, which is an insurance plan to protect banks from losses generated by high-risk assets. Stripping out this charge and restructuring costs the bank delivered an operating profit of £1.9 billion turning round a £6.1 billion loss a year ago. The bank made progress on the complex disposal of non-core assets where RBS is selling or winding down £250 billion of assets. It cut the portfolio by £63 billion or 37 per cent. Summarizing the results management said "We are still a good way from where we want to be in terms of our performance but 2010 represents another big stride towards that goal."
Negative Points:
The bank’s recovery remains dependent on a sustained economic recovery.
The creation of an Independent Commission on Banking to consider structural, financial stability and competition provides a degree of uncertainty towards the bank’s recovery.
Loan impairments within the group’s Ulster business rose almost 80 per cent last year and losses at the division more than doubled to £761million.
Like its investment banking peers, the group’s own investment banking operation suffered a 28 per cent fall in revenues.
No resumption of the dividend is yet in sight.
The government owns an 83 per cent stake in RBS after bailing the bank out during the financial crisis of 2008.
As a result of the government bailout, RBS was ordered by European regulators to dispose of a range of assets by 2013, including its insurance division.
Positive Points:
The government has said it will sell its 83 per cent stake in RBS, but is unlikely to do so until the Independent Commission on Banking reports its findings. An update is due in March with the final report to be published in September.
The bank is two years into a five year plan. The improved overall performance should assist the group’s preparation for a return to private ownership.
Investors will take comfort from evidence that bad loans at the bank are falling steadily and the core UK retail business is recovering.
The group plans to sell its ailing insurance arm in 2012. The division, which includes major insurance brands such as Direct Line and Churchill, made losses of £295 million as it incurred soaring injury claims and a &#"
mlkrborn
15年前
RBS swings into operating profit as impairments reduce
BFN
The Royal Bank of Scotland Group today reported a 2010 operating profit of £1.913bn, compared with a loss of £6.09bn in 2009. The 2010 attributable loss of £1.125bn includes APS after a tax charge of £1.116bn.
Q4 2010 attributable result was break-even (£12m profit).
Core RBS operating profit was £7.418bn, down 12% from 2009.
RBS reported a Core Tier 1 ratio of 10.7% and Loan to deposit ratio of 117% (Core 96%).
RBS said it is now two years into its five year plan to restore the Group to good health, and has made strong progress against its targets in 2010. Operating profit was £1,913 million, compared with a loss of £6,090 million in 2009, and Core return on equity remained stable at 13% for the year, with stronger Core Retail & Commercial operating profits offsetting more normal results from Global Banking & Markets (GBM), Core Tier 1 ratio at year end was 10.7%. Group income rose 10% in 2010 to £32.662bn with good growth in Core Retail & Commercial offsetting lower markets-related revenue in GBM.
Group income in Q4 2010 was 6% lower than in Q3, with Core income stable and Non-Core impacted by trading results, fair value write-downs and disposals.
Group net interest margin for the year improved by 25 basis points, and was broadly stable in Q4.
Group expenses for the full year were £16.71bn, 4% lower than in 2009.
The Group's cost saving programme has now delivered savings in excess of the £2.5bn target, funding renewed investment in the Core franchises. The cost:income ratio, excluding FVOD and net of claims, improved by 9 percentage points in 2010 to 60%. Q4 expenses were marginally down. Impairments were 33% lower in 2010 at £9.256bn, driven by a £3.745bn fall in Non-Core. Core impairments also fell, with improvements in UK Retail and GBM more than offsetting higher Ulster Bank impairments.
Impairments exceeded net write-offs by £3.1bn during the year, with provisions for impairments increasing from £15.2bn to £18.2bn. Q4 impairments rose by £188m, with higher provisions taken on the Ulster Bank Core and Non-Core portfolios. The Group balance sheet has been strengthened substantially over the course of 2010. Non-Core run-down has accelerated over the course of the year, with £16.3bn of balance sheet reduction in Q4 2010 reflecting good progress on both business disposals and portfolio sales. Non-Core assets, excluding derivatives were £137.9bn at the end of 2010, down £63.1bn from the prior year.
In addition to the disposals completed in 2010, circa £12bn of sales are signed but pending closing. Within the Group's EC-mandated disposal programme the sales of Global Merchant Services and most of the RBS Sempra Commodities JV assets were completed.
The Group exceeded its term funding targets with £38bn of issuance during the year. Liquidity reserves of £155bn were £5bn above target.
Net deposit growth was £14bn in 2010 helped improve the Group loan to deposit ratio to 117% (Core 96%), and the customer funding gap narrowed from £142bn to £74bn.
Short term wholesale borrowing requirements were reduced by £93bn during 2010 to £157bn.
Group Core Tier 1 ratio strengthened by 50 basis points in Q4 to 10.7%, positioning RBS well to meet future Basel capital requirements.
Story provided by StockMarketWire.com
mlkrborn
15年前
LONDON MARKETS
The continued turmoil in Libya continued to cast a cloud over proceedings in London again today, as investors digested a raft of blue chip earnings.
Royal Bank of Scotland provided a focus, as news of a swing to operating profit was dimmed by a rise in losses in Ireland. RBS shares fell 1.77p at 45.55p, making the group the biggest blue chip casualty at midday. Lloyds Banking Group, which reports results tomorrow, fell 0.88p at 64.62p and Barclays lost 3.95p at 315.05p in sympathy.
Cigarette maker BAT slumped 59.5p at 2,363.5p, missing analysts' estimates as it posted profit from operations 5% higher at £4.3bn, on the back of price rises, and hiked its full-year dividend 15%.
The leisure sector continued to suffer fallout from the Middle East upheaval, with tour operators TUI Travel and Thomas Cook slipping 2.3p at 238.25p and 2.1p at 188.45p, respectively.
Insurer RSA dipped 3.15p at 136.55p, although reporting a strong performance despite extreme weather conditions, with net written premiums of £7.5bn in 2010, up 11% on the prior year.
Automotive industry engineering group GKN fell 3.75p at 198.35p after Citigroup cut the stock to hold from buy.
On the upside with blue chips, the heavyweight miners were mixed, with BHP Billiton the pick of the crop, up 49.5p at 2,387p. Anglo American rose 43.5p at 3,159.5p, but Rio Tinto dropped 36.75p at 4,170.25p and Xstrata edged down 3.5p at 1,343.5p.
Oil producers produced gains as crude topped $100 a barrel on Nymex and Brent headed for $120, with Shell adding 29.75p at 2,196.75p and BP edging up 4.95p at 493.45p. Explorer Tullow Oil jumped 47p at 1,396p.
Can maker Rexam recovered some ground after a disappointing session yesterday, up 9.15p at 357.55p, helped by UBS, which has a buy rating on the stock, raising its target price to 380p from 370p. The group was also upgraded to outperform from neutral at Credit Suisse.
Outsourcing group Capita topped the leaderboard, ahead 52.25p at 722.25p, after well-received full-year numbers. Capita also said its bid pipeline stands at a record £4.7bn.
Story provided by StockMarketWire.com
mlkrborn
16年前
RBS Studies Options For Further Capital Structure Tweaks
Last update: 3/16/2010 5:15:43 AM
By Margot Patrick
Of DOW JONES NEWSWIRES
LONDON (Dow Jones)--Royal Bank of Scotland Group PLC (RBS) is continuing to study its options to make further adjustments to its capital structure, a spokeswoman said Tuesday, a process that analysts estimate could result in a gain of as much as GBP3 billion for the 84% state-owned bank.
RBS Chief Financial Officer Bruce Van Saun said three weeks ago that the bank expected to make a decision around mid-March on a potential "liability management exercise" that is expected to see the bank to exchange the bulk of its remaining GBP14.1 billion in preference shares and subordinated bonds for new contingent-capital notes or cash.
Analysts for months have been saying the move would be a no-brainer, since the securities are trading at only about half of face value as a result of the European Union's coming ban on RBS making interest payments or redeeming them for at least two years as a condition of its GBP45.5 billion government bail-out.
The ban starts at the end of April, meaning RBS would have to launch a buyback before then.
"Clearly, we have a window here to study a liability management exercise, and we certainly are considering our alternatives there," Van Saun told analysts Feb. 25. "I would say it's not an easy equation, with all the changing regulation around capital quantity and capital quality. We're certainly looking through that and considering what course of action we should take."
The spokeswoman for RBS said Tuesday that no decision has been reached yet, and declined to comment on a Financial Times story that says at least GBP10 billion of the debt will be repurchased. Hedge funds and other holders of the subordinated debt are keen to know RBS' plans, with an eye on making a profit from the premium RBS would be expected to offer over the debt's market prices.
Analysts have previously laid out their expectations of how such an exercise could help bolster RBS' capital structure and balance sheet, with Exane BNP Paribas' Ian Gordon anticipating that RBS could book a GBP3 billion gain. Such a move might also result in RBS reducing its reliance on a GBP8 billion contingent-capital facility provided by the government as part of the bank's restructuring late last year, costing the bank GBP320 million in annual fees.
RBS already made a series of debt exchanges last year, resulting in a GBP4.6 billion pretax gain in its first-half 2009 results. Other banks, including Lloyds Banking Group PLC (LYG) and the Netherlands' Rabobank, have exchanged subordinated debt for contingent capital notes, known as CoCo bonds, that either convert to equity or are written down to a fraction of their face value in times of financial stress.
RBS shares at 0910 GMT were up 1 pence, or 2.3%, at 44 pence.
-By Margot Patrick, Dow Jones Newswires; +44 (0)20 7842 9451; margot.patrick@dowjones.com
(END) Dow Jones Newswires
March 16, 2010 05:15 ET (09:15 GMT)
mlkrborn
16年前
Boss' Bonus: incredible!
HEARD ON THE STREET: RBS Banks Hester Bonus
Last update: 2/25/2010 7:48:16 AM
By Simon Nixon
A DOW JONES COLUMN
Stephen Hester is entitled to feel hard done by. If any European bank chief deserved a bonus this year, it was the Royal Bank of Scotland boss. Unlike Eric Daniels - to whom the Lloyds Banking Group board was inexplicably planning to hand a GBP2.6 million bonus until Daniels was shamed into rejecting it - Hester was not the author of his bank's misfortunes. He was brought in to revive the 84% state-controlled bank after taxpayers were forced to pump in GBP45 billion to rescue it - and judging by RBS's lower-than-expected GBP3.6 billion loss in 2009, he is succeeding. Bowing to political pressure by refusing his bonus was a worthy act of self-sacrifice.
True, RBS's performance, in common with other universal banks, was largely driven by its investment banking unit, buoyed by massive monetary and fiscal stimulus. But the division's GBP5.7 billion operating profit - nearly double 2007 levels - was achieved despite the negative publicity and a restructuring that halved the size of its balance sheet, suggesting Hester has limited the damage to the franchise. That will raise hopes that revenues of around GBP2 billion in each of the last two quarters are sustainable.
Hester was also lucky the global economy picked up and unemployment has so far turned out lower than expected. That helped keep a lid on impairments which, while still huge at GBP1.9 billion in the fourth quarter alone, appear to have peaked in the third quarter. Combined with a slight increase in net interest margins to 1.83% thanks to higher prices for loans, RBS's retail and commercial bank units in the U.K. and U.S. were able to beat market expectations. Of course, the retail banks remain vulnerable to a double dip recession, but for the moment, Hester believes the worst may be over.
Either way, Hester looks to have succeeded in his first objective: to stabilize RBS. The bank now has a core Tier 1 capital ratio of 11% and a loan to deposit ratio of 135%, down from 154%. With 70% of the planned balance sheet reduction now achieved, it's no longer fanciful to look through the bank's current difficulties to Hester's "core RBS", which generated operating profits of GBP8.3 billion and a return on equity of 13%. Ironically, the improved outlook means RBS may now be more inclined to hold on to non-core assets for longer. But to the extent this minimizes ultimate losses, it should prove an added bonus - for shareholders and taxpayers, if not for Hester.
(Simon Nixon is European editor of Heard on the Street. He can be contacted on +44 207 842 9206 and Simon.Nixon@wsj.com)
mlkrborn
16年前
$11. 00s Only 5.5 B loss--getting less but bonuses up more than 40 percent! MFs!
Royal Bank of Scotland loses $5.5 billion in 2009
Royal Bank of Scotland loses $5.5 billion for year, say bad loans may have peaked
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RBS 11.91 +0.78
Chart for Royal Bank of Scotland Group Pl
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Robert Barr, Associated Press Writer, On Thursday February 25, 2010, 4:10 am EST
LONDON (AP) -- Royal Bank of Scotland Group PLC, government-owned after being bailed out, reported a loss of 3.6 billion pounds for 2009 but beat expectations and said the peak of bad loans from the economic crisis may have passed.
CEO Stephen Hester, who along with his deputy waived any bonus for the year, cited improvements but said a "hard slog" lay ahead.
The loss compared to a 24.3 billion pounds loss, a British corporate record, racked up by RBS in 2008 following the disastrous takeover of the Dutch Bank ABN Amro. RBS wrote off 16.9 billion pounds in goodwill in 2008 related to ABN Amro and in RBS' NatWest subsidiary.
The analysts' consensus forecast was a loss of 5.7 billion pounds.
Revenue rose 34 percent to 31.7 billion pounds, up from 23.6 billion pounds in 2008. The bank booked impairment losses of 13.9 billion pounds for the year, compared to 7.4 billion in 2008.
RBS, which is 84 percent owned by the government after being bailed out during the worst of the credit crisis, said its operating loss shrank from 6.9 billion pounds in 2008 to 6.2 billion pounds.
In the fourth quarter, RBS reported a net loss of 765 million pounds, down from 1.8 billion in the third quarter.
RBS shares were up 3.4 percent at 37.35 pence as the London Stock Exchange opened.
"The spike in the share price in early trade is likely to be in reaction to the amount of bad news previously factored into the valuation," said Richard Hunter, analyst at Hargreaves Lansdown Stockbrokers.
RBS was the biggest casualty of the banking crisis in Britain, which also saw the government taking over mortgage lender Northern Rock and buying a 43 percent stake on Lloyds Banking Group.
"We have exceeded all the principal milestones we set for the first year of our plan. An 8.3 billion profit for 2009 in our core businesses provides evidence that the new RBS can deliver sustainable earnings," said Chief Executive Stephen Hester.
The "core" operating profit included 5.7 billion pounds from RBS' Global Banking and Markets investment arm, "which successfully took advantage of buoyant markets despite the handicaps of its own radical restructuring," Hester said.
"RBS is also becoming safer and smaller more quickly than we expected. We have already completed 70 percent of our planned balance sheet reduction. Most importantly, our customer base remains loyal as we implement the changes to our business," Hester said.
Hester said loan impairments of 13.1 billion pounds, compared to 6.5 billion pounds a year earlier, "may have peaked in 2009" but he cautioned that "2010 will be a year of hard slog, with limited visibility of our end value."
The pace of Britain's economic recovery and regulatory changes were key unknowns, he said.
Hester and Deputy Chief Executive Gordon Pell both waived their bonus payments for the year, but the bank won government approval to dish out 1.3 billion pounds to employees.
"On bonus payments for 2009, we were guided by a policy to pay the minimum necessary to retain and motivate staff who are critical to the recovery of RBS," the bank said.
RBS agreed in November to divest RBS Insurance, Global Merchant Services and its interest in RBS Sempra Commodities as a condition for joining the British government's asset protection scheme to insure the company against losses on 282 billion pound
mlkrborn
17年前
Investment Banking
R.B.S. Investors Set to O.K. Bad Debts Scheme
December 15, 2009, 5:21 am
Investors in Royal Bank of Scotland Group are set to back its decision to sign up to a state scheme for bad debts but will grill executives on its restrictive terms, including a government veto on pay.
The part-nationalized bank will agree to unprecedented intervention on bonuses as part of the package expected to be approved, which will see the government insure 282 billion pounds of R.B.S.’s bad debts, Reuters reported.
Banker pay has become an increasingly hot political topic in the run-up to an election due next year, but analysts, investors and R.B.S. itself have warned that added restrictions for the bank could hinder its ability to hire and set back its recovery.
On top of a one-off windfall levy on bonuses across the sector announced last week, and an already-agreed restriction on cash bonuses, R.B.S. faces a government veto on the “quantum and shape” of its bonus pool.
That prompted its board members to seek legal advice on whether they should resign if government forced them to take a position that would harm investors and therefore violate their fiduciary duties, Reuters said, citing industry sources.
Prime Minister Gordon Brown and other politicians have said there is no discrimination against R.B.S., but markets have remained uneasy over the threat of a mass board walkout that could harm the bank’s recovery potential.
R.B.S.’s private investors, once stakeholders in one of Scotland’s proudest institutions, now own just 20 percent of the beleaguered bank after it was pulled back from the brink of collapse last year with a partial nationalization.
Under the Asset Protection Scheme the government will offer bad debt protection and its interest will rise to 84 percent from 70 percent.
Edinburgh-based R.B.S., whose troubles put it at the centre of the credit crunch, is the only bank signing up to the APS after domestic rival Lloyds Banking Group turned to the market to raise cash and boost its capital ratios.
R.B.S. is insuring a variety of assets under taxpayer protection, including loans to hedge fund managers, shipping loans, U.K. bank overdrafts and Irish property loans. More than half the loans are overseas.
The bank secured more flexible, “pay-as-you-go” APS terms last month, which would allow it to leave the scheme within four years. In exchange, it will take a higher loss before the insurance kicks in, making it unlikely the bank will dip into the APS fund.
R.B.S. is also being forced to sell chunks of its retail bank (under revived brand Williams & Glyn’s) and its RBS Insurance arm. It will also shrink its investment bank.
The forced disposal plan, which aims to compensate for billions in state aid, was approved by E.U. authorities on Monday.
Go to Article from Reuters via The New York Times »
mlkrborn
17年前
Dubai factor:
KPMG To Represent Dubai Creditor Banks, Which Seek $30B -Report
Last update: 11/30/2009 8:54:43 AM
DOW JONES NEWSWIRES
U.K. banks that lent more than $30 billion to Dubai World plan to appoint auditor KPMG LLC to represent them in talks aimed at recovering their money from the emirate's heavily indebted state investment arm, the Independent newspaper reported Sunday, without citing sources. The banks include HSBC Holdings PLC (HBC), Royal Bank of Scotland Group PLC (RBS), Lloyds Banking Group PLC (LYG) and Standard Chartered PLC (STAN.LN). KPMG's appointment will come once the creditor banks have set up a steering committee composed of five or six of the main lenders to lead the talks, the newspaper said. KPMG declined to comment.
mlkrborn
17年前
LONDON (ShareCast) - More huge write-offs sent Royal Bank of Scotland (LSE: RBS.L - news) deep into loss over the past three months.
The state-controlled bank that on Tuesday announced another £33bn cash injection from the government lost £2.1bn in the three months to September compared to a profit of £1.9bn. Nine-month losses now total £2.06bn against a profit £1.8bn this time last year.
Impairment charges in the last quarter totalled £3.49bn against £5bn in the previous quarter and £1.4bn this time last year. Net income for the quarter fell to £8.8bn from £9.96bn.
"The Group's strategy has been embedded in five-year plans across divisions, and the more recent 2010 budgets provide encouraging support for these plans," chief executive Stephen Hester said.
The bank also defended its record on lending and said it is on course to hit targets of £25 bn of lending (£9bn of mortgage lending and £16bn of business lending) to creditworthy customers on commercial terms. This was a condition of it joining the UK government's toxic asset protection scheme.
"RBS is unambiguous in its view that these commitments are being met. However, as is normal in recessions, our customers are generally seeking to repair their balance sheets, not to increase borrowing. As a result, the demand for our lending is muted, especially from business customers," it said.
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