RBS share price down 4% after profits slide as Brexit uncertainty hurts margins
Royal Bank of Scotland blamed Brexit uncertainty and its search for a new CEO for its dip in Q1 profits that sent its share price lower on Friday.
Royal Bank of Scotland (RBS) saw its share price fall more than 4% on Friday after it recorded a decline in Q1 profit, with the lender blaming Brexit uncertainty for its poor first quarter performance.
The bank also said that its performance was impacted by its hunt for a new CEO after its current boss Ross McEwan stepped
RBS results: key figures
The bank saw its net profit hit £707mllion, which exceeded the company’s consensus estimate of £546 million, but shy if the £808 million that the lender recorded in the same period a year prior.
RBS’ operating pre-tax profit for the quarter came in at £1.013 billion, down from the £1.213 billion recorded last year.
The lender said that it is still on track to meet its £300 million cost reduction target this year, with it already achieving a £45 million reduction in its first quarter.
Brexit uncertainty hurts RBS’ margins
The bank blamed its lacklustre start to the year on uncertainty caused by Brexit which has led to businesses curtailing investment and borrowing until there was a clarity on the UK’s future relationship with the EU.
In a call with reporters, McEwan argued that the bank’s Q1 figures represented a ‘solid set of results against an uncertain economic and political background’.
The lender also said that its growth was hindered by increased competition in the mortgage market.
‘While we retain the outlook guidance we provided in the 2018 Annual Results document, we recognise that the ongoing impact of Brexit uncertainty on the economy, and associated delay in business borrowing decisions, is likely to make income growth more challenging in the near term,’ RBS said in its results.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. Please see important Research Disclaimer.
Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
European Central Bank meeting
Learn about how the ECB meeting affects interest rates and price stability ahead of the next announcement.
- How might the next meeting affect the markets?
- What are the key rate decisions to watch?
- Why is the Governing Council announcement important for traders?
Live prices on most popular markets
- Forex
- Shares
- Indices
See more forex live prices
See more shares live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
See more indices live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.
