RBS lost 'more than any bank in the world' - claim

Published on Wednesday 24 June 2009 11:24

Part-nationalised Royal Bank of Scotland lost more money than any other bank in the world last year, a leading industry journal declared today.

RBS's overall losses of 36 billion during a disastrous 2008 put it at the top of a list compiled by The Banker magazine, ahead of ailing US giant Citigroup.

The bank is now 70%-owned by the taxpayer and in the process of shedding tens of thousands of jobs.

RBS came under more fire this week after details emerged of a 9.6 million pay and shares package for new chief executive Stephen Hester, who is charged with turning around the ailing business.

RBS was sent plunging to its UK record losses by a mammoth write-down on its acquisition of Dutch rival ABN Amro at the top of the market in 2007, as well as soaring bad debts.

The bank's overall statutory losses stood at 40.7 billion in February, but this now stands at 36 billion due to conversion effects from the US dollar.

Former chief executive Sir Fred Goodwin, who oversaw the bank's ill-fated expansion programme, agreed last week to give up part of his controversial 703,000 annual pension.

HBOS – the bank which lost almost 11 billion last year and had to be rescued from nationalisation through a takeover by Lloyds TSB – is sixth on the list of losses.

US investment bank JP Morgan topped the list of the world's strongest banks by tier one capital – a key measure of their financial strength.

On this measure, HSBC was third overall – but also the highest-ranked bank not to receive any kind of state aid.

HSBC's pre-tax profits slid to 9.3 billion dollars (6.5 billion) in 2008 but it called on investors for a UK record 12.5 billion in a rights issue earlier this year to strengthen its finances.