RBS expects to significantly outperform guidance on impairments

Majority state-owned lender Royal Bank of Scotland (RBS) now expects to “significantly” outperform its previous guidance of approximately £1bn in total impairments for the fiscal year 2014.

The above is thanks to a strong operating performance by RBS Capital Resolution (RCR) and a continued improvement in economic conditions and asset prices, including Ireland.

RCR is now forecast to record net provision releases of £0.5bn in the third quarter, the bank said in a trading update.

“There has been an absence of large one-off impairments and lower levels of new non-performing loans in the rest of RBS's business during Q3 2014,” the lender added.

Despite all of the above, management reiterated that previously disclosed uncertainties remain, “particularly relating to conduct and litigation matters.”