Royal Bank of Scotland has tumbled to a loss in its third quarter after taking a £900m hit for payment protection insurance (PPI) claims.
The part-nationalised lender reported attributable losses of £315m in the three months to September 30, against profits of £448m a year earlier. It posted pre-tax operating losses of £8m.
It blamed the £900m bill for PPI following a last minute surge in claims ahead of the August 29 deadline, as well as a "particularly challenging" quarter for its investment banking arm.
Despite the third-quarter losses, RBS said it remains on track for full year expectations in "uncertain times".
Chief financial officer Katie Murray said: "These results demonstrate our solid underlying performance in a tough operating environment.
"The core retail and commercial bank continues to perform well, and we are making good progress against our targets for the year.
"We have seen strong growth across the business and our sustained high levels of capital and liquidity mean we are well positioned to support our customers in these uncertain times."
Ed Monk, associate director from Fidelity Personal Investing’s share dealing service, said: “There was no easy start for new RBS CEO Alison Rose with third quarter numbers today underlining the tough conditions for banks.
"Profits were all but wiped out by another £900m provision for PPI mis selling.
“Earnings expectations were left unchanged, but previous ambitions for profitability in 2020 are now unlikely to be met. For investors, RBS may be attractive on value grounds and brokers have set elevated target prices for the shares, but the update today lays out the challenge in getting there.”