RBS sees challenging Q4 as debt charges hit results

Royal Bank of Scotland expected market conditions to remain challenging into the fourth quarter, as charges on the value of its own debt hit the third-quarter results of the part-nationalised British bank.
RBS reported on Friday a third-quarter operating loss of 132 mln pounds, compared with a second-quarter profit of 869 mln.
Earnings were hit by a charge of 858 mln pounds in relation to movements in the fair value of the group's own debt. The bank said excluding this, it had an operating profit of 726 mln pounds in the third quarter, helped by a 21% drop in bad debts compared to the second quarter.
Earlier this week, concerns over losses from problem loans overshadowed rival part-nationalised British bank Lloyds
RBS said the fourth quarter would remain challenging for its GBM investment banking arm, while the trends for its retail and commercial banking division were in line with those of the third quarter.
It added that it expected a UK bank levy to cost it 225 mln to 250 mln pounds next year, rising to 350 mln to 400 mln pounds in 2012.