RBS posts Q3 profit despite continued misconduct costs

Restructuring costs for the bank remained high at £847 million, while litigation and conduct costs were £129 million - still significantly down on £780 million in Q3 2014.

However the bank admitted that future litigation and misconduct costs could be "substantially greater" than expected.

In a statement, RBS said:

"Whilst legacy issues continue to be addressed, material further and incremental costs and provisions in respect of conduct and litigation related matters are expected, and could be substantially greater than the aggregate provisions RBS has recognised."

Excluding the gain from Citizens, the bank's Q3 operating loss was £134 million, down from a profit of £1,107 million in Q3 2014.

Restructuring costs totalled £847 million, principally relating to CIB (£637 million, including £276 million of property related charges) and to Williams & Glyn separation (£190 million).

Williams & Glyn submitted its banking licence application to the UK regulatory authorities in October 2015. RBS said it will continue to work towards its separation in the summer of 2016 and an initial public offering by the end of 2016.

Mortgage activity strengthened further in Q3, with applications up 66% from £6.2 billion in Q3 2014 to £10.2 billion and new business market share of approvals increasing to 15%. Total loans and advances increased by £3.8 billion during the quarter, with total mortgage balances at 30 September 2015 up 6% compared with Q3 2014.

Income was £596 million lower than in Q3 2014, principally driven by a £394 million decline in Corporate & Institutional Banking, reflecting its planned reshaping.