The Royal Bank of Scotland is to write off £1.25 billion due to exposure to bad debts in the American sub-prime loans market. The decrease in house prices across the Atlantic, combined with rising mortgage defaults, have resulted in loans being less valuable than many banks had envisaged.
However, the Royal Bank of Scotland hasn’t been as badly affected as many analysts had anticipated, especially given its purchase of ABN Amro which accounts for around £300 million of the money RBS is to write off. RBS is also faced with a £250 million impairment charge on loans made to private-equity buyouts, though the bank has been able to offset the loss from its cash reserves.
Despite the large sums the bank has been forced to write off, RBS revealed that this year’s pre-tax profits are set to exceed £10 billion, whilst their integration with ABN Amro is apparently going well.
RBS Enjoys Profitable Year Despite Bad Debts
RBS Enjoys Profitable Year Despite Bad Debts
Thu, 13 Dec 2007
Recommended links
The Essential Banking GuideDebt Solutions
Leading Savings Accounts
Bad Credit Loan Lenders
Top Pension Providers
US Banking Losses Trigger Weaker Dollar
Savers Withdraw 14 Billion Pounds From Bank
| Banking news |
|---|
| HSBC the Latest Bank to Announce Further Write Downs - Fri, 16 May 2008 |
| Citigroup to Make Cuts to Banking Portfolio - Wed, 14 May 2008 |
| UBS to Make Banking Job Cuts - Wed, 07 May 2008 |
| More News |
