The Royal Bank of Scotland is expected to report an increase in profits for the second year in a row in its full-year results that is scheduled to be released this week.
According to analysis from S&P Capital IQ, the net income of the company is forecast to rise from £752 million to £1.46 billion and the revenue is expected to rise from £12.8 billion to £13.25 billion when the bank publishes its financial results this coming Friday.
The bank is also expected to hand out a £335 million bonus to its employees. However, the said amount is slightly less as compared to the £342 million payout that was given last year despite the improving financial performance and a massive reduction from the £1.3 billion that was shared out in 2009.
In a report that was published by Sky News, it said that both the board of RBS and UK Government Investments (UKGI), which manages the 62.4 percent public stake in the bank, have agreed on the said bonus pool.
If confirmed, the bonus awards will signify the tenth successive year in which the bank has reduced the payouts to its staff amid political outrage following its £45.5 billion bailout.
It comes after the investors approved a buyback scheme last week that will enable RBS to acquire up to £1.5 billion of government shares as it strives to move towards full privatisation. Currently, the bank is 62.4 percent owned by the taxpayers.
Russ Mould, an investment director at AJ Bell, stated: “Shareholders will want to see whether RBS is still shrinking itself back to health or moving into growth mode.”
He added: “Brexit remains a cloud on the horizon, and we’d expect the bank to strike a cautious note in its outlook.”
An equity analyst from Hargreaves Lansdown, Sophie Lund-Yates, stated: “However, with markets now pricing in an interest rate rise before the end of the year, usually good news for banks, the longer term outlook for RBS is looking rosier than it has for a long time.”