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

Ukip's Nigel Farage and Paul Nuttall. Photo: Getty
Show Hide image

Is the general election 2017 the end of Ukip?

Ukip led the way to Brexit, but now the party is on less than 10 per cent in the polls. 

Ukip could be finished. Ukip has only ever had two MPs, but it held an outside influence on politics: without it, we’d probably never have had the EU referendum. But Brexit has turned Ukip into a single-issue party without an issue. Ukip’s sole remaining MP, Douglas Carswell, left the party in March 2017, and told Sky News’ Adam Boulton that there was “no point” to the party anymore. 

Not everyone in Ukip has given up, though: Nigel Farage told Peston on Sunday that Ukip “will survive”, and current leader Paul Nuttall will be contesting a seat this year. But Ukip is standing in fewer constituencies than last time thanks to a shortage of both money and people. Who benefits if Ukip is finished? It’s likely to be the Tories. 

Is Ukip finished? 

What are Ukip's poll ratings?

Ukip’s poll ratings peaked in June 2016 at 16 per cent. Since the leave campaign’s success, that has steadily declined so that Ukip is going into the 2017 general election on 4 per cent, according to the latest polls. If the polls can be trusted, that’s a serious collapse.

Can Ukip get anymore MPs?

In the 2015 general election Ukip contested nearly every seat and got 13 per cent of the vote, making it the third biggest party (although is only returned one MP). Now Ukip is reportedly struggling to find candidates and could stand in as few as 100 seats. Ukip leader Paul Nuttall will stand in Boston and Skegness, but both ex-leader Nigel Farage and donor Arron Banks have ruled themselves out of running this time.

How many members does Ukip have?

Ukip’s membership declined from 45,994 at the 2015 general election to 39,000 in 2016. That’s a worrying sign for any political party, which relies on grassroots memberships to put in the campaigning legwork.

What does Ukip's decline mean for Labour and the Conservatives? 

The rise of Ukip took votes from both the Conservatives and Labour, with a nationalist message that appealed to disaffected voters from both right and left. But the decline of Ukip only seems to be helping the Conservatives. Stephen Bush has written about how in Wales voting Ukip seems to have been a gateway drug for traditional Labour voters who are now backing the mainstream right; so the voters Ukip took from the Conservatives are reverting to the Conservatives, and the ones they took from Labour are transferring to the Conservatives too.

Ukip might be finished as an electoral force, but its influence on the rest of British politics will be felt for many years yet. 

0800 7318496