S&P lifts RBS's long-term credit rating to BBB

Standard&Poor's has revised its rating on Royal Bank of Scotland's long-term debt higher, arguing that its strengthened balance sheet and improved earnings have boosted the lender's ability to navigate the uncertain political and economic landscape in the UK.

The ratings agency boosted its rating from BBB- to BBB, with a 'stable' outlook attached.

"[RBS] is well advanced in addressing legacy risks and implementing a more focused, profitable business model," S&P said in a statement.

Increasingly, the main driver of its credit profile is its core franchise, with its retail and commercial banking business at the fore.

And its asset quality metrics had improved toward the peer group average, with its credit losses currently very low.

"[RBS] restored consistent profitability in 2017 and targets a return on tangible equity in excess of 12% next year. We see this as ambitious but nevertheless expect RBSG's performance to strengthen as it reduces strategic restructuring charges and operating costs.

"Management's priorities also include continued technology investment and improved customer satisfaction."