RBS swings to losses after missing expectations for third quarter

The Royal Bank of Scotland (RBS) reported a third-quarter attributable net loss of £315 million ($406.9 million) on Thursday, missing the £988 million profit forecast from Reuters.

The British lender was hit by a £900 million charge in the last quarter to settle mis-selling claims in the fallout of a payment protection insurance (PPI) scandal.

RBS also cited a particularly challenging quarter in its NatWest Markets (NWM) business, which saw its total income fall by £419 million compared to the third quarter of 2018, coming in at £150 million.

The bank’s third-quarter attributable net profits for the same period last year were £448 million, when the lender set aside £100 million ($128 million) to account for economic uncertainties such as Brexit and warned of a “highly competitive market.”

The net operating loss came in at £8 million, compared to a £961 million profit for the third quarter of 2018.

The bank’s new CEO Alison Rose is due to take over from the departing Ross McEwan on November 1, the day after the U.K. is set to leave the European Union.

The bank’s 2020 outlook, revised in last quarter, had cited “continued economic and political uncertainty and the contraction of the yield curve” as rendering it “very unlikely” that the target return on tangible equity of more than 12% and cost:income ratio of less than 50% will be achieved in 2020.