Royal Bank's profits rise

The Royal Bank of Scotland has become the latest bank to report a strong set of profit figures.

The Scottish group, which now includes NatWest, said pre-tax profits rose 11% in the first six months of this year to £1.5bn.

We are making good progress with integration and have met all of our initial targets

Viscount Younger
Royal Bank of Scotland

The Royal Bank says it is on target to achieve its target of £1.2bn worth of cost savings following the takeover of NatWest in March.

Helping to cut costs will be a further 1,500 jobs going by the end of the year, plus another 9,000 by 2003.

In the run-up to the merger, there had been fears that customers - especially big corporate clients - might abandon NatWest after the take-over.

However the bank said there had been no signs of "customer migration" so far.

Group chairman Viscount Younger said: "Whilst recognising that much remains to be done, the integration process is firmly on track to deliver the forecast cost savings and other benefits."

Because the take-over took place during the financial year the results were issued on a "pro-forma" basis.

On this basis its profits of £1.5bn compared to £1.36bn during the first half of 1999.

Shareholders will get an interim dividend of 9.5p per share, up 16%.

The merger turned Royal Bank into the UK's third biggest bank, with ambitions to get profits up to £5bn.