RBS share price steady as investors eye first-half update

Shares in Royal Bank of Scotland Group (LON:RBS) have advanced in London this morning, outperforming the broader market, ahead of the lender’s half-year update tomorrow, when the company is expected to unveil a loss. The update will follow the results of the European Union stress test last week, which showed that the FTSE 100 group was among the banks which saw their capital fall the most in the adverse case scenario.

As of 10:16 BST, RBS’ share price had gained 0.73 percent to 191.99p, as compared with a 0.02-percent dip in the benchmark FTSE 100 index. The group’s shares have lost more than 42 percent of their value over the past year, and are down by over 36 percent in the year-to-date.
City A.M. reports that RBS is expected to post a loss attributable to shareholders of £247 million for its second quarter when it updates investors on its interim performance tomorrow. The Telegraph meanwhile quoted Barclays as forecasting that a UK economic downturn is likely to impact provisions and the net interest margin of the group’s ongoing business.

Investors will also be looking out for an update on the group’s Williams & Glyn business, after RBS warned earlier this year that it might miss yet another EU deadline to divest the branches, a condition of the group’s state-funded bailout. Earlier this week, however, news emerged that Spain’s Banco Santander had made an offer for Williams & Glyn, which could potentially end the lengthy process of offloading the branches.
The results will come after the European Banking Authority revealed last week that under the scenario of a three-year downturn, RBS could lose 7.5 percentage points of capital, marking the third-biggest fall of the 51 banks tested, with the result prompting concerns that dividends at the bailed-out lender might be delayed further.
As of 10:39 BST, Thursday, 04 August, Royal Bank of Scotland Group share price is 191.70p.