Abbey National stays deep in the red

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The Independent Online

The Abbey National banking group remained deep in the red today after taking a string of one-off charges as part of its three-year revival plan.

The group reported wider-than-expected bottom-line losses of £686 million for the year to December 31 - still an improvement on the £947 million seen in 2002.

Despite the heavy losses, chief executive Luqman Arnold said the turnaround strategy launched by Abbey last year remained on track with a "substantial recovery" in results expected for this financial year.

A large chunk of today's losses were blamed on non-trading charges incurred from the disposal of non-core assets, mainly in the corporate sector.

Those businesses are being offloaded as part of an overhaul that will enable Abbey to concentrate on its recently rebranded personal finance business. That division reported profits of £1.02 billion, against £1.22 billion last time.

Mr Arnold said it had been a tough year for the group but that progress had been made, particularly in reducing risk levels.

He added: "Given the upheaval the business has had to cope with, the trading results reported today are resilient and encouraging for the future."