RBS high street chains shrug off the derisive headlines

The Royal Bank of Scotland may have made the headlines for all the wrong reasons last year but, perhaps surprisingly, that has done little damage to its high street and retail franchises such as NatWest and Churchill Insurance.

Retail banking profits fell sharply from £723 million to £229 million but that was entirely because of a £660 million increase in money put aside for bad debts. The vast bulk of that comes from credit card defaults and bad mortgages.

Profits before impairments actually rose by 10%.
The UK retail banks (including RBS, NatWest and Ulster) attracted 360,000 new current accounts last year taking the total to 12.8 million.

RBS's share of the mortgage market rose from 7% to 12% with income from mortgages more than doubling from £500 million to £1.2 billion. Secured and unsecured loans to customers increased by 10%. Savings by customers grew by 11% which is well ahead of the market average.

Across the retail network, costs were cut by 5% with the biggest saving coming in direct staff costs which were down by 9% as 10% of staff lost their job.

Churchill, part of the insurance division which is up for sale, sold an extra 234,000 motor policies.