RBS Q2 net rises despite restructuring charge doubling to 1.1 billion sterling

Says it has set aside 459 million in Q2 to deal with litigation issues

State-backed Royal Bank of Scotland reported a rise in second quarter profit despite booking a 1.1 billion pound ($1.7 billion) charge for restructuring after accelerating the overhaul of its business.

RBS said on Thursday it also set aside 459 million in the second quarter to deal with conduct and litigation issues.

The bank made an attributable profit of 293 million pounds ($457 million), up 27% on the same period last year. Analysts had expected a loss of 260 million pounds, according forecasts provided by the bank.

RBS said it planned to return capital to shareholders by paying dividends or buying back shares, but said it would not be in a position to do so until the first quarter of 2017 at the earliest.

 

The bank, which is 78%-owned by the British government, said it would run down its 'bad bank' called RBS Capital Resolution (RCR) before the end of 2015, a year ahead of schedule.

RBS said its restructuring costs in the quarter more than doubled from 453 million pounds in the first quarter "as the pace of restructuring accelerated."

Chief Executive Ross McEwan is battling to turn around the bank, whose reputation has been hit by a number of scandals since it was rescued by the government during the 2007-09 financial crisis at a cost of 45.8 billion pounds to taxpayers.

The bank's underlying performance has improved, benefiting from Britain's economic recovery, but it continues to be hampered by issues relating to past misconduct.

($1 = 0.6412 pounds)