Royal Bank of Scotland announces £3.6 billion loss
Royal Bank of Scotland has today announced a £3.6 billion loss for 2009 which is far less the £5 billion which analysts had been expecting and but a fraction of the £24 billion lost in 2008. While this will be a relief to UK taxpayers, who have an 84% stake in the company, is by no means the end of the troubles for Royal Bank of Scotland and there is still much hard work to be done. The company has also announced a £1.3 billion bonus pool which will be primarily focused upon the company's investment bankers.
While chief executive Stephen Hester has rejected the offer of a £1.6 million bonus the fact that £1.3 billion is being put aside for bonuses at a time when the company has announced multibillion pound losses will upset taxpayers. The company is also suggesting it may well have lost out, with key members of staff leaving the company, because of the restraints on bonus payments and the lower levels compared to peers in the sector. So what next for Royal Bank of Scotland?
There is no doubt that 2010 will be a year of consolidation at best with the company unable or unlikely to make major inroads until the dust has settled and the ongoing reorganisation has been completed.
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