RBS forecast beats market hopes

Royal Bank of Scotland’s annual pre-tax profits will top £9bn (€13.3bn) this year after the group said it performed well in 2006.

RBS, which owns NatWest and Churchill Insurance, pleased the City by forecasting results slightly ahead of market estimates for a figure in the region of £9.16bn (€13.5bn).

The company posted a surplus of £8.25bn (€12.2bn) from last year after stripping out one-off items.

It added that its retail business had done well, with stronger mortgage lending in the first half offsetting weaker demand for consumer credit.

RBS also offered some encouragement on bad debts, with its losses in this area continuing to moderate.