UK banks are less than half way through posting £240 billion ($398 billion) of losses on loans and securities, a reflection of the country’s economic weakness, according to Moody’s Investors Service.
British banks are likely to record losses of at least £130 billion, in addition to £110 billion lost since the beginning of the credit crisis in 2007, Moody’s said in a report on Monday.
The company expects the sustained weakness of the UK macroeconomic environment to feed through into higher loan arrears with ensuing pressure on profitability and capital, it said.
British taxpayers have provided about £1.4 trillion of support to banks, becoming the biggest shareholder of Royal Bank of Scotland Group and Lloyds Banking Group, while seeking to shore up capital eroded by writedowns. British banks have raised about £120 billion of capital from the beginning of the credit crisis to mid-2009, Moody’s said. “We have been underweight on the banks for some time”, said Dave Bradbury who helps manage $6 billion at Canada Life in London.
Agencies
Showing posts with label Royal Bank of Scotland. Show all posts
Showing posts with label Royal Bank of Scotland. Show all posts
Tuesday, September 15, 2009
Thursday, February 12, 2009
Royal Bank of Scotland to axe 2,000 jobs, says report
Royal Bank of Scotland, which is majority-owned by the British government, is about to announce plans to cut 2,000 jobs after forecasting a record annual loss for 2008, BBC television reported on Tuesday.
A company spokesman contacted by reporters refused to comment on the report.
Royal Bank of Scotland (RBS) was bailed out by the government earlier this year after running into trouble raising funds from shareholders because of the credit crunch and is now 68-percent owned by the state.
The report of job cuts came as the bank's former chief executive, Fred Goodwin, apologised Tuesday to lawmakers for failing to foresee the financial turmoil that led to RBS being rescued.
The bank says it expects a 2008 annual loss of up to 28 billion pounds (32 billion euros, 41 billion dollars) -- a record in British corporate history -- due to the crisis and a costly takeover of Dutch lender ABN Amro in 2007.
Agencies
A company spokesman contacted by reporters refused to comment on the report.
Royal Bank of Scotland (RBS) was bailed out by the government earlier this year after running into trouble raising funds from shareholders because of the credit crunch and is now 68-percent owned by the state.
The report of job cuts came as the bank's former chief executive, Fred Goodwin, apologised Tuesday to lawmakers for failing to foresee the financial turmoil that led to RBS being rescued.
The bank says it expects a 2008 annual loss of up to 28 billion pounds (32 billion euros, 41 billion dollars) -- a record in British corporate history -- due to the crisis and a costly takeover of Dutch lender ABN Amro in 2007.
Agencies
Tuesday, December 16, 2008
More banks reveal exposure to Madoff
Banks and investment funds across the world lined up on Monday to admit investing billions of dollars in the companies of Bernard Madoff, whom US authorities accused of masterminding a massive fraud.
Britain’s HSBC was the latest bank to join the growing list, saying it had exposure of around $1 billion, making it one of the biggest victims of the alleged $50 billion fraud. Royal Bank of Scotland and Man Group in the UK, Japan’s Nomura and France’s Natixis also said they were hit by the worldwide scandal.
Financial companies, reeling after a year of enormous writedowns on bad credit assets, have so far tallied up more than $10 billion in direct and indirect exposure to the possible fraud by Madoff, the 70-year old trader who was arrested on Thursday. “There is a broader danger here for the industry,” an equity analyst said.
“This huge fraud, supposedly in blue-chip funds, is going to make people nervous, and you’ve already seen massive redemptions,” the analyst said. Shares in France’s Natixis were down 4.7% after it said it had as much as E450 million ($605 million) of exposure to the fiasco. The wider DJ Stoxx banking index was 0.9% lower.
US prosecutors and regulators have accused Madoff, a former chairman of the Nasdaq Stock Market, of running the fraud through his investment advisory business, which managed at least one hedge fund. Man Group, the world’s largest listed hedge fund manager, said it was exposed to Madoff through its fund of funds business RMF, which has $360 million invested in funds directly or indirectly sub-advised by Madoff. BNP Paribas and Santander detailed potential losses on Sunday, and others joined at the start of the trading week, with Italy’s UniCredit showing exposure of around E75 million.
RBS said its potential loss could amount to some £400 million ($595 million), if it assumed that the value of its assets in Madoff’s firm were nil.
Its exposure to the scandal was through trading and collateralised lending to funds of hedge funds invested in the group, the bank said in a statement.
Hedge funds are already struggling after a year that has badly damaged their boast that they can make money whichever way the market turns.
Source: Agencies
Britain’s HSBC was the latest bank to join the growing list, saying it had exposure of around $1 billion, making it one of the biggest victims of the alleged $50 billion fraud. Royal Bank of Scotland and Man Group in the UK, Japan’s Nomura and France’s Natixis also said they were hit by the worldwide scandal.
Financial companies, reeling after a year of enormous writedowns on bad credit assets, have so far tallied up more than $10 billion in direct and indirect exposure to the possible fraud by Madoff, the 70-year old trader who was arrested on Thursday. “There is a broader danger here for the industry,” an equity analyst said.
“This huge fraud, supposedly in blue-chip funds, is going to make people nervous, and you’ve already seen massive redemptions,” the analyst said. Shares in France’s Natixis were down 4.7% after it said it had as much as E450 million ($605 million) of exposure to the fiasco. The wider DJ Stoxx banking index was 0.9% lower.
US prosecutors and regulators have accused Madoff, a former chairman of the Nasdaq Stock Market, of running the fraud through his investment advisory business, which managed at least one hedge fund. Man Group, the world’s largest listed hedge fund manager, said it was exposed to Madoff through its fund of funds business RMF, which has $360 million invested in funds directly or indirectly sub-advised by Madoff. BNP Paribas and Santander detailed potential losses on Sunday, and others joined at the start of the trading week, with Italy’s UniCredit showing exposure of around E75 million.
RBS said its potential loss could amount to some £400 million ($595 million), if it assumed that the value of its assets in Madoff’s firm were nil.
Its exposure to the scandal was through trading and collateralised lending to funds of hedge funds invested in the group, the bank said in a statement.
Hedge funds are already struggling after a year that has badly damaged their boast that they can make money whichever way the market turns.
Source: Agencies
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