Royal Bank of Scotland net profits triple in Q1

Britain’s state-rescued Royal Bank of Scotland said that net profits tripled to £1.2bn ($2.0bn, 1.5bn euros) in the first quarter, buoyed by lower costs and falling impairments.

RBS, based in Edinburgh, Scotland, remains 81% state-owned after it was rescued with £45.5bn of taxpayers’ cash during the 2008 global financial crisis, making it the world’s biggest-ever banking bailout.

Earnings after taxation surged in the three months to the end of March 2014, compared with £393mn in the same part of 2013, RBS said in a results statement. Market expectations had been for a net loss of £200mn and revenues of £4.7bn, according to analysts polled by Dow Jones Newswires.

Revenues declined two% to £5.05bn, as the bank’s markets division continued to shrink. Pre-tax profits meanwhile doubled to £1.64bn from £826mn a year earlier, but the troubled bank warned that it still faced “plenty” of issues to deal with.

“Just over two months ago, I set out our plan for making RBS the most trusted bank in the UK,” said chief executive Ross McEwan, who was appointed last year to help strengthen the lender’s turnaround strategy and help guide it back to private ownership.

“Today’s results show that in steady state, RBS will be a bank that does a great job for customers while delivering good returns for our shareholders. “But we still have a lot of work to do and plenty of issues from the past to reckon with. Everyone at RBS is focused squarely on doing everything we can to earn the trust of our customers and in the process change the banking sector for the benefit of the UK.”

The first-quarter results were lifted by the absence of any provision for misconduct issues that have haunted the bank since the global financial crisis.

And in another major boost, RBS revealed that impairments across its loan book tumbled by 65% in the reporting period.

Operating expenses meanwhile fell six% to £191mn, as the group shed about 6,300 jobs mostly at its retail and markets division.