Ulster Bank's owner RBS to post loss after £2.5bn hit
Ulster Bank owner Royal Bank of Scotland (RBS) has confirmed it will post a loss for 2015 after taking a £2.5bn hit - including more mammoth charges for mis-selling scandals.
Bosses at the bank said the latest "clean-up" charges are set to see it remain in the red when it posts full-year results next month, its eighth year running of annual losses.
RBS is setting aside another £500m for payment protection insurance (PPI) mis-selling claims, as well as £1.5bn to cover US legal action on toxic mortgage-backed bonds sold before the financial crisis. It also revealed a £498m write-down on the value of its troubled private bank, Coutts, while it said it was pumping another £4.2bn into its pension scheme.
While the pension payment will largely come from reserves, the remaining £2.5bn in provisions and write-downs will directly hit the bank's bottom line.
Shares in RBS sank 3% to a new three-year low, following the news.
Royal Bank of Scotland chief executive Ross McEwan commented: "I am determined to put the issues of the past behind us."
He added: "We've always been open about the scale of past issues facing RBS and, although there is clearly much more to do, this announcement is a further step towards addressing legacy issues."
Meanwhile, Santander has revealed profits last year took a £450m hit for payment protection insurance, as the scandal continues to take its toll on the sector.
The Spanish-owned lender said its UK profits fell 4.1% to £1.3bn after the charge to cover compensation for PPI mis-selling.