Royal Bank of Scotland (RBS) is expecting to report full-year 2013 losses of nearly £8bn, after the bank revealed that it will shed another £3.1bn for claims settlement.
RBS had decided to pay £1.9bn to cover fines for mis-selling mortgage bonds in the US, £465m for mis-selling payment protection insurance, and another £500m for mis-selling interest rate hedging products to small businesses.
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Additionally, RBS expects losses of £4.5bn from bad loans and investments, taking the total losses for the year to £8bn.
In order to meet the losses, RBS plans to waive the bonuses of its top nine executives for 2013 and 2014.
RBS CEO, Ross McEwan, said he knows that this team is not responsible for past mistakes but they are the team in charge of operations now so they need to show leadership.
"The scale of the bad decisions during that period means that some problems are still just emerging. The good news is we are now a much stronger bank and can manage these costs while still supporting our customers.
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By GlobalData"We have restored our fundamental soundness and have the financial strength to deal with issues like this. We will now become a much simpler, more effective bank for our customers and shareholders. We are now well advanced in our efforts to deal with those things that distract us from building a better bank for customers, employees and shareholders," McEwan added.
