Five questions answered on RBS’s positive quarterly profit results

Investors react.

The bank that was famously bailed out in the 2008 financial crisis has posted its best quarterly profits for over a year. We answer five questions on RBS’s latest figures.

How much pre-tax profit has the bank made?

The bank has made a pre-tax profit of £826m, this is compared to a £1.5bn loss in the same period in 2012 and a £2.2bn loss in the final quarter of last year.

What has been the bank’s response to these positive results?

In a video statement on the bank’s website, Chairman Sir Philip Hampton said he expects the government to start selling shares in the bank from the middle of 2014, or possibly earlier, so the bank can return to privatisation.

He said any such sale would be "terrific for the country".

The government owns an 82 per cent stake in the bank after it bailed it out in 2008.

What else did Hampton say?

"Our balance sheet is substantially fixed... our operating profitability has come through quite strongly," he said.

"What we want to do is have a business that is performing well... enabling the government to start selling shares from, let's say, the middle of 2014 on - it could be earlier, that's a matter for the government - but certainly we think the recovery process will be substantially complete in about a year or so's time."

If the government sold its shares in the next year or so would they be getting a good deal?

It’s not known how much the government would sell its stake for, but currently, RBS shares are valued at 407 pence a share on the government's accounts. However, the government paid 502 pence a share during the bailout.

According to the BBC’s business editor, Robert Peston, this suggests the Chancellor, George Osborne, could opt to sell at the lower price and still claim to be getting fair value for the 82 per cent taxpayer stake.

This would result in a return to shareholders after the government invested billions in the bank five years ago.

How have investors reacted to the quarterly results?

Despite Hampton’s optimism, investors have reacted negatively, with RBS shares falling more than 4.5 per cent in the first 10 minutes of trading on the London Stock Exchange.

RBS. Photograph: Getty Images

Heidi Vella is a features writer for Nridigital.com

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The real question about George Osborne and the Evening Standard? Why he'd even want the job

The week in the media, from Osborne’s irrelevant editorship to the unrepentant McGuinness and Vera Lynn’s stirring ballads.

The big puzzle about George Osborne’s appointment as the editor of the London Evening Standard is why he wanted the job. The Standard is now just a local freesheet, a pale shadow of its old self. In Tube carriages, discarded copies far exceed those being read. Its columnists are lightweight [Ed: as an occasional columnist myself, thanks, Peter] and its news stale, mostly written the previous day. Critics of Osborne’s appointment describe the Standard as “a major newspaper”. It is no such thing. The idea that the editorship will allow the former chancellor to propel himself towards the London mayoralty is laughable. In last year’s election for mayor, the Standard, according to University of London research, ran twice as many positive headlines about the Tories’ Zac Goldsmith as it did about Labour’s Sadiq Khan. The latter won comfortably. The paper was so supportive of Khan’s predecessor, Boris Johnson, that it became known as “the Daily Boris”. But Johnson, with a high profile from television, hardly needed its backing to beat a tired and largely discredited Ken Livingstone.

If Osborne believes that the Standard offers him a significant political platform, it is just further proof that he belongs to an ignorant elite.

 

Violent legacy

More than anyone else, Martin McGuinness, who has died aged 66, represented how the IRA-Sinn Fein combined uncompromising violence with negotiating charm to achieve its aims. Unlike Gerry Adams, McGuinness admitted openly and proudly that he was a senior IRA commander. In Londonderry on Bloody Sunday in 1972 he carried a sub-machine gun, but apparently without using it. Later that year, he was among a delegation that held secret talks with British ministers and officials. The following year, he was arrested near a car containing prodigious quantities of explosives and ammunition.

Like many who recall the IRA’s campaign in mainland Britain – three huge bombs detonated less than half a mile from me – I could never quite accept McGuinness as a government minister and man of peace. Whatever he said, he did not renounce ­violence. He just had no further use for it, a decision that was reversible.

 

A peace of sorts

When I hear politicians saying they could never contemplate talks with al-Qaeda, I smile. They said the same about the IRA. The idea of negotiation, John Major said, “turns my stomach”. A month later, news leaked of secret talks that would lead to a ceasefire. You can call it hypocrisy but politicians have no practical alternative. Significant terrorist campaigns rarely end without deals of some sort. Even then, dishonesty is necessary. The parties to the Good Friday Agreement with Sinn Fein in 1998 never admitted the true terms, perhaps even to themselves. In return for a role in government, the IRA ceased attacks on the British mainland, army, governing classes and commercial interests. It remained in control of working-class Catholic enclaves in Northern Ireland, where it continued to murder, inflict punishment beatings and run protection rackets. Not a pretty bargain, but it brought peace of a sort.

 

Real war anthems

“We’ll Meet Again” and “The White Cliffs of Dover”, sung by Dame Vera Lynn, who has just celebrated her 100th birthday, are the songs most closely associated with the Second World War. This, when you think about it, is peculiar. Most wars are associated with stirring, patriotic anthems, not sentimental ballads. Even the First World War’s “Keep the Home Fires Burning”, before it mentions hearts yearning for home, stresses the noble, manly instincts that drove soldiers to fight: “They were summoned from the hillside/They were called in from the glen,/And the country found them ready/At the stirring call for men.” Lynn’s songs had only the wistful sadnesses of parting and reassurances that nothing would change.

Their “slushy” tone troubled the BBC. It feared they would weaken the troops’ fighting spirit. Despite Lynn’s high ratings among listeners at home and service personnel overseas, her radio series was dropped in favour of more virile programmes featuring marching songs. Unable to sing to her forces fans over the airwaves, Lynn bravely travelled to the army camps in Burma. A BBC centenary tribute showed veterans of the war against Japan weeping as her songs were played back.

The wartime role of this unassuming plumber’s daughter makes me – and, I suspect, millions of others – feel prouder to be British than any military anthem could.

 

Ham-fisted attempt

After his failed attempt to increase National Insurance contributions for the self-employed, Philip Hammond, it is said, will have a £2bn hole in his budget. It will be more than that. Thanks to the publicity, tens of thousands more workers in regular employment will be aware of the tax advantages of self-employed status and hasten to rearrange their affairs. Likewise, newspaper accountants of old, after circulating memos imploring journalists to reduce lavish claims for “subsistence” while covering stories away from the office, would find a sharp rise in claims from hacks previously unaware that such a perk existed.

 

Battle of Hastings

My fellow journalist Max Hastings, attending a West End play, was once dragged on stage by the comedian James Corden, told to help move a heavy trunk and slapped on the bottom. Ever since, I have approached plays starring comedians warily. I dropped my guard, however, when I bought tickets for a contemporary adaptation of Molière’s The Miser starring Griff Rhys Jones, and found myself drenched when Jones spilled (deliberately) what purported to be fine wine. It was of course only water and, unlike
Hastings, I shall not demand a refund.

Peter Wilby was editor of the Independent on Sunday from 1995 to 1996 and of the New Statesman from 1998 to 2005. He writes the weekly First Thoughts column for the NS.

This article first appeared in the 23 March 2017 issue of the New Statesman, Trump's permanent revolution