ROYAL BANK OF Scotland, the parent company of Ulster Bnak, has reported a pre-tax loss of nearly €6 billion in its latest results out this morning.
RBS, which is majority owned by the British government, made a pre-tax loss of £5.17 billion (€5.97 billion) as it was hit by a series of charges in what it called a “chastening” year.
Its Irish subsidiary, Ulster Bank, accounted for more than £1 billion (€1.2 billion) of these losses as it accounted for £1.4 billion of the £5 billion the entire bank put aside to cover loans that are unlikely to be repaid or loan impairments as they are known.
RBS chief executive Stephen Hester told shareholders in a letter accompanying its financial statement that the bank faced “significant reputational challenges” in 2012.
He said that the bank had been working with regulators to “to put right past mistakes” which included the mis-selling of payment protection insurance, the mis-selling interest rate swaps and its fine for attempting to fix the Libor inter-bank lending rate.
Ulster Bank also suffered significant problems with customers over the summer when a technical glitch with its computer system prevented customers from accessing their accounts.
The IT failure is estimated to have cost the bank over €100 million including redress for the 750,000 customers affected, some of whom were not paid their wages because of the glitch.