Profits leap for Royal Bank of Scotland

Megan Davies,City Staff,Pa News
Thursday 28 February 2002 01:00

Royal Bank of Scotland today reported a 28 per cent leap in profits for the last year – but also showed a jump in its provisions for bad debts.

The group, which bought NatWest two years ago, said pre-tax profits for the year to December 31 rose to £4.3 billion, up from £3.3 billion the previous year.

Stripping out one-off costs and goodwill, profits jumped 32 per cent to £5.8 billion.

Sir George Mathewson, chairman, said: "All our businesses have grown income and improved efficiency, producing notable profit increases."

However the group increased its level of provisions, partly a reflection of the economic downturn and a number of "specific customer situations".

Sir George said: "Credit quality remains good, although we have made prudent increases in our level of provisions to reflect the growth in our business combined with the deterioration in the short-term economic outlook and a small number of specific customer situations."

New provisions were up by £230 million to £1.1 billion, while recoveries of amounts previously written off were down £116 million to £80 million.

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