RBS up 14% despite soaring bad debts
Investors overlooked Royal Bank of Scotland’s soaring bad debts today to send shares in the part-nationalised bank almost 14% higher.
The £2.9bn (€3.25bn) in bad debts unveiled by RBS were accompanied by better-than-feared pre-tax losses of £44m (€49.3m) and strong investment banking results, which helped shares 5.8p ahead to 47.4p.
The news came amid a brighter session for banks in general as the FTSE 100 Index rose 55.7 points to 4454.4 by mid-morning.
Despite losses on Wall Street overnight, global markets rose after stress tests on US banks calling for 10 to add a total of £50bn (€56bn) in equity were well-received, although US jobs data due later today could dampen the mood.
Alongside RBS’s rise to the top of the FTSE risers' board, Lloyds Banking Group strengthened 5% – or 4.5p to 101.5p – after its heavy losses yesterday.
HSBC rose 15.75p to 570.75p ahead of a trading update due on Monday, although Barclays shed 5.75p to 270p as investors continued to take profits after the firm’s healthy update and strong recent run.
Other top-flight fallers included media group Thomson Reuters which shed 56p to 1756p after RBS brokers slapped a sell rating on the firm. Travel company Thomas Cook went the same way, down 9p to 282.5p despite more positive comments on the firm from Citigroup.
