Perhaps the most shocking thing about the revelation RBS is heading for a further multi-billion-pound loss is that I wasn’t shocked at all.
For a once-proud Scottish institution, the last six years have been a nightmare from which it simply has not been able to wake up.
There has been so much bad news surrounding the Edinburgh-headquartered bank since the financial collapse of 2008 that it has been difficult to see any light at the end of the tunnel.
We have had books and television documentaries which took a stab at quantifying the problems which put a noose around the bank’s neck, but it has since transpired that even the most scathing of commentaries has failed to truly grasp the seriousness of the situation.
Once the largest bank in the world, RBS’s fall from grace under Fred Goodwin was so great and so swift with the need for a taxpayer-backed bailout to ensure its survival that it became a byword for corporate governance gone wrong.
A large portion of the blame for RBS’s current predicament has been put on its ill-fated and ill-advised move to buy the Dutch financial group ABN Amro, but there were many, many more failures.
Bad loans, bad investments, bad assets, mis-selling, mismanagement and market manipulation the list has been endless, and I suspect we shall never truly get to the bottom of what happened.
Tens of thousands of hard-working bank staff did not contribute to RBS’s downfall but have had to pay the price, in terms of jobs and reputation, for the failures of those further up the chain who pulled the strings. It is fair to say that RBS circa 2008 was an apple rotten at its core.
But despite the latest gloomy financial outlook this week, I sense some positive change afoot at RBS.
Ross McEwan, who was parachuted into the bank’s top job last year in a bid to restore profitability and regain respectability, does not appear one for ducking the hard decisions.
He is also honest enough to admit the bank’s problems are still just emerging but is taking steps now such as Monday’s setting aside of £3.1bn to deal with financial claims to draw a line under damaging issues such as PPI rather than letting them continue ad nauseam.
While there is no sign of short-term respite from RBS’s woes, Mr McEwan’s strategy of confronting the problems head-on rather than waiting for the next problem to crawl out of the woodwork seems to be a sensible way to progress.
We all have a vested interest in seeing the venerable old institution succeed, and I for one hope Mr McEwan’s long-term strategy works and the bank is restored to rude health.
RBS is currently taking its medicine for the sins of the past, but it remains immensely important to the health of the UK economy.
* I was pleased to see that flights to London from Dundee Airport will continue after CityJet’s withdrawal at the end of March.
Talks between Dundee City Council, Transport Scotland, airport operator HIAL and carrier Loganair have ended with a temporary agreement being put in place that will see a new link to London Stansted established.
That has to be welcomed. But, given the financial record of the Riverside airstrip it already receives a seven-figure sum of public cash every year in order to keep the lights on I was not impressed to hear that details of the new arrangement were not being disclosed on the grounds of commercial confidentiality.
Where a significant sum of taxpayers’ money is concerned, there should be transparency to allow those picking up the tab to make up their minds about the investment being made in their names.