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

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Boris Johnson isn't risking his political life over Heathrow

The anti-Heathrow campaigner was never a committed environmentalist. 

A government announcement on expanding London’s airports is expected today, and while opposition forces have been rallying against the expected outcome - a third runway at Heathrow - the decision could also be a divisive one for the ruling Conservative party. A long consultation period will allow these divisions to fester. 

Reports suggest that up to 60 Conservative MPs are against expansion at the Heathrow site. The Prime Minister’s own constituents are threatening legal action, and the former London mayoral candidate, Zac Goldsmith, has promised to step down as MP for Richmond rather than let the airport develop.

But what of Boris Johnson? The politician long synonymous with Heathrow opposition - including a threat to lie down “in front of those bulldozers” - is expected to call the decision a mistake. But for a man unafraid to dangle from a zipwire, he has become unusually reticent on the subject.

The reticence has partly been imposed upon him. In a letter to her cabinet ministers, Theresa May has granted them freedom from the usual rules of collective responsibility (under which cabinet ministers are required to support government positions). But she has also requested that they refrain from speaking out in the Commons, from “actively” campaigning against her position, and from calling “into question the decision making process itself”.  

Johnson is not about to start cheering for Heathrow. But unlike Goldsmith, he is no committed environmentalist - and he's certainly a committed politician.  

Boris’s objections to the expansion at Heathrow have all too often only extended as far as the lives of his London constituents. These local impacts are not to be belittled – in his role of mayor of London, he rightly pointed to the extreme health risks of increased noise and air pollution. And his charisma and profile have also boosted community campaigns around these issues. 

But when it comes to reducing emissions, Johnson is complacent. He may have come a long way since a 2013 Telegraph article in which he questioned whether global warming was real. Yet his plan to build an alternative “hub” airport in the Thames Estuary would have left the question of cutting UK aviation emissions worryingly un-resolved. This lack of curiosity is alarming considering his current job as foreign secretary. 

And there are reasons to be concerned. According to Cait Hewitt at the Aviation Environment Federation, the UK fails to meet its targets for CO2 reduction. And the recent UN deal on aviation emission mitigation doesn’t even meet the commitments of the UK’s own Climate Change Act, let alone the more stringent demands of the Paris Agreement. “Deciding that we’re going to do something that we know is going to make a problem worse, before we’ve got an answer, is the wrong move”, said Hewitt.

There is a local environmental argument too. Donnachadh McCarthy, a spokesperson from the activist group “Rising Up”, says the pollution could affect Londoners' health: "With 70 per cent of flights taken just by 15 per cent of the UK's population... this is just not acceptable in a civilised democracy.”

The way Johnson tells it, his reason for staying in government is a pragmatic one. “I think I'd be better off staying in parliament to fight the case, frankly," he told LBC Radio in 2015. And he's right that, whatever the government’s position, the new “national policy statement” to authorise the project will likely face a year-long public consultation before a parliamentary vote in late 2017 or early 2018. Even then the application will still face a lengthy planning policy stage and possible judicial review. 

But if the foreign secretary does fight this quietly, in the back rooms of power, it is not just a loss to his constituents. It means the wider inconsistencies of his position can be brushed aside - rather than exposed and explored, and safely brought down to ground. 

India Bourke is an environment writer and editorial assistant at the New Statesman.