RBS set to unveil worst annual loss in UK corporate history

Part-nationalised Royal Bank of Scotland is set to unveil the biggest annual loss in UK corporate history after a catastrophic 2008.

Chief executive Stephen Hester is also likely to reveal details of plans to split the business in two and for large-scale sell-offs - as well as cost savings that could lead to the axing of tens of thousands of jobs.

A loss of up to £28bn (€31.3bn) is expected after bad debts of up to £8bn (€8.95bn) and writedowns of as much as £20bn (€22.3bn) more on its disastrous acquisition of Dutch bank ABN Amro.

The announcement will come the day after RBS said it will end its sponsorship of the Formula One team Williams at the end of the season in 2010 as a result of the economic downturn.

It will also follow the revelation by British treasury minister Stephen Timms that the current RBS board was "extremely concerned" at reports that former chief executive Fred Goodwin was already drawing £650,000 (€727,267) a year from his £16m (€17.9bn) pension pot, even though he was only 50.

RBS made a pre-tax profit of £10.1bn (€11.3bn) in 2007, but British taxpayers have pumped £20bn (€22.4bn) into the struggling business since last autumn's financial crisis brought RBS to its knees - giving them a 70% stake.

RBS may also announce the result of talks with the British Treasury over placing up to £250bn (€279.75bn) of the group's toxic "assets" in a British government-backed scheme.

It hopes this will put its balance sheet on a firmer footing and limit future credit crunch losses as the bank seeks a path back from the brink.

Later, several Bank of England officials, including governor Mervyn King, will give evidence to the Commons Treasury Committee in its inquiry into the banking crisis.