Newspaper article The Journal (Newcastle, England)

Analysts Expect RBS to Unveil Pounds 613m Losses

Newspaper article The Journal (Newcastle, England)

Analysts Expect RBS to Unveil Pounds 613m Losses

Article excerpt

Byline: Iain Laing

THE part-nationalised banks will take their turn in the spotlight this week as the City's annual results season steps up a gear.

The recent 32% surge in annual profits at Barclays and healthy performance by French giant Societe Generale has raised hopes for taxpayerbacked Lloyds Banking Group and Royal Bank of Scotland ahead of their 2010 results.

While the part-nationalised players are not expected to come close to matching their performance, they are expected to reveal further steps in their recovery following the financial crisis.

For both players, the market will be interested to see more details on exposures to the troubled Irish economy, as well as improvements on retail bad debts.

RBS is first out of the stalls on Thursday. Figures from the US players and Barclays are likely to have more of a bearing on the group than Lloyds as it has a sizeable investment banking division through its Global Banking & Markets arm.

But while a pounds 4.4bn investment banking haul helped Barclays report pounds 6.1bn in profits for 2010, RBS is not expected to claw its way out of the red. Analysts at Nomura expect RBS to report pre-tax losses of pounds 613m for 2010, although this is a marked improvement on the pounds 1.93bn loss seen in 2009.

For Lloyds, its report on Friday will represent a milestone as it is expected to mark the first annual profit since being bailed out amid the banking crisis.

Its third-quarter update confirmed it was on track for a return to the black at the full-year stage after reporting interim profits of pounds 1.6bn.

Utility giant Centrica is set to provoke further public outrage over high energy bills on Thursday when it reports a 29% surge in annual profits. British Gas, Centrica's residential arm, put up its prices by 7% in December last year, blaming mounting pressures from soaring wholesale prices. …

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