LONDON: Royal Bank of Scotland on Thursday reported a loss of 24.1 billion pounds ($34.3 billion) for 2008, the biggest in UK corporate history, and said it planned to place 325 billion pounds of assets in a state insurance scheme.
The bank said the record deficit reflected a 16.2 billion pound writedown against acquisitions, including its takeover of parts of Dutch rival ABN Amro in 2007, plus a further 7.9 billion pounds in operating losses.
RBS also announced plans to raise a further 13 billion pounds from the government through the issuance of B shares, and unveiled a cost-cutting programme aimed at reducing expenses by 2.5 billion pounds.
“We have moved purposefully to take major decisions that are necessary to restructure the group,” RBS chief executive Stephen Hester said in a statement.
“We are charting a path to standalone strength and with it the goal of justifying the support of the UK government and all our shareholders.”
The plan came as Britain launched a scheme that could end up insuring more than 500 billion pounds worth of toxic assets in a bid to get lending in the recession-hit economy. Under the government-backed insurance scheme designed to support ailing banks, RBS will be responsible for the first 19.5bn pounds of losses — or 6pc of the asset value.
Courtsey: The News
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