The Royal Bank of Scotland Group reported a second quarter operating profit of £869m, up from £713m in the first quarter of 2010. Core headline operating profits were stable at £2.193bn and attributable profit was £257m.
The group achieved break-even for the first half of the year.
Retail & Commercial was up on rising NIM and continued favourable credit trends, but Global Banking & Markets declined from a strong first quarter. RBS said it was on track against strategic plan targets.
Second quarter operating profit improved to £869m compared with £713m in the first quarter. Operating profit in the first half totalled £1.582bn, compared with a loss of £3.354bn in the first half of 2009.
Excluding gains recorded on the fair value of own debt, Group second quarter operating profit was £250m, down from the first quarter but substantially improved from a £2.573bn loss in the second quarter of 2009.
Net of restructuring and other non-operating costs, including a £500m accounting credit related to the Asset Protection Scheme, profit before tax was £1.157bn, compared with a loss of £21m in the first quarter of 2010.
Second quarter net attributable profit was £257m, compared with a loss of £248m in Q1 2010. The attributable profit in the first half was £9m, compared with a loss of £1.042bn a year earlier.
Core businesses' headline operating profit held steady at £2.193bn, with progress in Retail & Commercial but lower revenue in Global Banking & Markets, reflecting a weaker capital markets environment.
Group net interest margin was 2.03%, up 11 basis points relative to the first quarter, led by the Core retail and commercial businesses, where NIM expanded by 14 basis points.
Total impairments fell from £2.675bn in the first quarter to £2.487bn the second quarter, reflecting gradual strengthening of the global economy.
Non-Core's run-off programme remains on track, with funded assets reduced by £20bn during Q2.
Core Tier 1 capital ratio stood at 10.5% at end-June, compared with 10.6% at 31st March 2010, and Tier 1 ratio at 12.8%. The recent EU-wide stress tests confirmed that RBS remains well capitalised, with a strong Tier 1 capital ratio under both the benchmark and adverse scenarios.
The run-off of the Non-Core loan book drove a further improvement in the Group loan to deposit…
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