The Royal Bank of Scotland has reported its ninth year of losses, and said that it is not likely to return to profit until 2018.
The bank, which has been partially owned by the taxpayer since the 2008 financial crisis, reported losses of £7 billion for 2016. Since its bailout nearly ten years ago, the bank’s losses have totalled more than £58 billion.
The bank now intends to cut costs by £2 billion in order to push itself back into the black, with RBS’ chief executive Ross McEwan confirming that the plans are likely to involve significant job cuts. To the BBC, he said the cost cuts were “huge, and unfortunately there will be job losses amongst that”.
“Branches have been closing and will continue to close. The shape of a branch is changing, and what people do in a branch is changing,” he added.
“The bottom line loss we have reported today is, of course, disappointing but given the scale of the legacy issues we worked through in 2016, [the losses] should not come as a surprise,” McEwan continued.
“These costs are a stark reminder of what happens to a bank when things go wrong and you lose focus on the customer, as this bank did before the financial crisis.”
McEwan, who was paid £3.5 million in 2016, took on the role of CEO in 2013 after Stephen Hester’s departure. He confirmed that he continued to stay in the post until the bank’s recovery was complete.
The bank’s current priorities are resolving a settlement with the US Department of Justice surrounding RBS’ role in the financial crisis, for which other banks including Credit Suisse and Deutsche Bank have already taken signifiant hits.
The future of its smaller arm, Williams & Glynn, also hangs in the balance after the Treasury announced that it intended to free RBS of its obligation to spin out those branches.
The government have said they will not be able to sell their 73 percent stake in the bank until those issues have been resolved.
Shares in RBS are currently trading down 2.17 percent on the news at 244.00 (0904GMT).