Another day, another raft of bad news from Royal Bank of Scotland

Outlook

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Another day, another multibillion-pound hit from regulatory provisions, write-offs and pension contributions incurred by Royal Bank of Scotland just a few weeks before it declares its eighth consecutive annual loss. There could be a degree of kitchen sinking at work here, from a management team under pressure from the Treasury, or UK Financial Investments, or whoever is really in control of the process of selling the thing. They’re desperate to get shot of the shares, despite a brutal bear market and the fact that there is a glut of banking assets gearing up to join it – including the small business bank that RBS has to sell to keep the EU sweet. They really should curb their enthusiasm, but that’s not the point I want to pursue here.

RBS’s announcement, coming so soon after the devastating report by regulators into the failure of HBOS, makes a fresh comparison of the two worthwhile. The chairman of the House of Commons Treasury Committee, the Tory MP Andrew Tyrie, among others, has noted that HBOS was proportionately the bigger disaster when taking the two banks’ relative sizes into account. It was a one-trick pony; a predominantly UK and Irish lender run by a bunch of cavaliers who gave scant consideration to the vast reservoir of risk they were filling up.

But was it the worse failure? I’m not so sure, and here’s why: RBS, once the world’s biggest bank by assets, was a huge and sprawling empire. No mere one-trick pony, with its bewildering array of different businesses and operations, it had a whole stableful.

What these figures once again underline is just how shockingly badly so many of them were managed. Many, if not most, of those ponies were lame. Small wonder that the bank ended up in the knacker’s yard.

The latest tale of woe includes a fresh slug of money for PPI compensation and also a write down on an underperforming private bank, another provision against a forthcoming penalty over sales of mortgage-backed securities in the US and a huge amount of money going into the bank’s pension funds.

The scary thing is that even if that lot is to keep the Government sweet ahead of further share sales, we might not be at the end of it. The bank is still awaiting a report from regulators into its Global Restructuring Group. And there may still be other skeletons to rattle. Add that little lot on to RBS’s other problems: it was involved in both the Libor and forex rigging scandals. Its creaky technology shut customers out of their accounts – and they’re just the big and recent nasties.

It’s sometimes easy to forget just how badly so many parts of this once-respectable bank were mismanaged because of the sheer regularity with which bad news belches forth. It’s cheap for banks to continually bang on about legacy issues, as if bad things should immediately be forgiven and forgotten by dint of their happening a couple of years in the past, but in this case I have to admit a certain amount of sympathy for chief executive Ross McEwan and his team. The purges of the Royal Bank of Scotland managers who were responsible extended deep into the roots of the organisation, and yet the new administration is engaged in a constant battle to put out fires ignited by their errors.

Some among the HBOS crew may ultimately be censured for their conduct – a review into the Financial Services Authority’s decision to take no action against former managers is under way. This latest announcement makes one think: why not RBS?