25-02-2010, 12:06 PM
Blimey!
http://news.bbc.co.uk/1/hi/business/8534694.stm
http://news.bbc.co.uk/1/hi/business/8534694.stm
Quote:RBS reports £3.6bn loss for 2009
Royal Bank of Scotland (RBS) has announced losses for 2009 of £3.6bn ($5.5bn), after struggling with billions of pounds of bad loans.
Despite the losses, the bank is set to announce it will pay bonuses totalling £1.3bn to its staff.
But the bank's head, Stephen Hester, said it had lost money by not paying big bonuses to retain productive staff.
The UK taxpayer owns 84% of RBS after the government bailed out the bank at the end of 2008.
'Experiment'
Chief executive Mr Hester told BBC Radio 4's Today programme: "We've had a small experiment in this respect... some of our best-performing people have been leaving in their thousands.
"The people who left us last year, I believe, would have increased our profits by up to £1bn beyond the ones that we've got."
Mr Hester has decided not to take his own bonus, which would have been £1.6m.
RBS's £3.6bn loss is lower than the £5bn many experts were expecting and is well below the £24bn it lost in 2008.
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However, the level of bad debts rose sharply to just short of £13.9bn, up from £7.4bn in 2008, although the bank says it thinks these have now peaked.
Torrid time
Mr Hester said he expected the bank to return to profit next year.
The banks have been through a torrid time since the credit crunch struck in 2007, an event sparked by the banks' own unwillingness to lend to each other after the major lending spree they had been on started to turn bad.
Added to that was RBS's unique heavy burden - its takeover of the Dutch bank ABN Amro in late summer 2007 just as the banking boom was about to turn to bust.
It paid £49bn for the business, only to make a writedown of £17bn a year later, largely due to that ABN Amro deal.
RBS is the second major UK bank to report 2009 results, after Barclays announced profits of £11.6bn last week. Lloyds Bank, which is also partly state-owned, will report its results on Friday.
Under fire
Aside from bonuses, one other controversial topic for the banks has been their role in lending to business and home buyers.
RBS said that it was satisfied it was fulfilling both the letter and the spirit of its lending commitments, which were to make an additional £9bn available to the mortgage market and £16bn to businesses.
It said it had beaten its mortgage target, but had fallen short of its business lending target as many companies had been concentrating on reducing their debts and the recession meant that demand for loans had been weak.
RBS has shrunk massively in size over the year. In 2008 its assets stood at £2.1tn.
It has been running down a vast portion of its business - mainly bad loans - and its assets are now worth £1.5tn.
A bank spokeswoman said that was the equivalent of shedding an organisation the same size as the profitable US financial institution, Goldman Sachs.
The shadow is a moral problem that challenges the whole ego-personality, for no one can become conscious of the shadow without considerable moral effort. To become conscious of it involves recognizing the dark aspects of the personality as present and real. This act is the essential condition for any kind of self-knowledge.
Carl Jung - Aion (1951). CW 9, Part II: P.14