May 4 - The Royal Bank of Scotland will repay all the money it borrowed in an emergency bailout in 2008 after reporting a surge in profits for the first quarter. Joanne Nicholson reports.
The Royal Bank of Scotland has promised to finish paying back the money it borrowed to save it from collapse by next week. The bank's boss, Stephen Hester, made the pledge as the bank's first quarter results were released. RBS reported a profit of 1.2 billion pounds compared with a loss of 144 million the previous quarter, and said this was down to its reshaped investment bank. But Hester says he doesn't think the government has any plans to sell its 82 percent stake - at least not with the share price as it is. The shares climbed 2 and a half percent on the news of RBS' positive results - by mid morning - to around 25 pence. That's still half the price paid by the government when it bailed out RBS in 2008, at the height of the financial crisis. That means the state would make a 23 billion pound loss if it sold now. Even so, analysts have been heartened by the speed at which the RBS balance sheet is recovering. The positive results have paved the way for the bank to start paying out dividends again too . Joanne Nicholson, Reuters