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RBS half-year profit jumps
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August 1, 2000: 5:47 a.m. ET
Bank sees early fruits of $32B NatWest takeover in half-year earnings
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LONDON (CNNfn) - Royal Bank of Scotland PLC unveiled its first set of earnings Tuesday since completing its acquisition of rival National Westminster Bank, and pleased investors with a bumper increase in first-half operating profit.
RBS said operating earnings rose 23 percent to £2.01 billion ($3 billion), while pretax profit advanced 11 percent to £1.51 billion. Analysts had forecast pretax profit of between £1.078 billion and £1.66 billion, according to Reuters.
The bank published pro forma profit, showing NatWest's contribution as if it had been part of the firm since the beginning of last year. RBS shifted its financial year-end to Dec. 31 following the deal. It has already reported results for the six months through March, excluding any contribution from NatWest.
"We are making good progress with integration and have met all of our initial targets," Chairman George Younger said in a statement, describing the profit increase as "an encouraging start, the more so as it demonstrates the potential of the enlarged group."
The company reported that it reduced its ratio of costs to income, a measure often used in the financial markets to gauge the efficiency of banks, to 55.7 percent in the six months through June from 60.0 percent a year earlier.
Net income rose to £782 million, or 29.5 pence a share, from £703 million, or 26.6 pence.
RBS completed the £21 billion acquisition of its larger rival on March 6, beating out competition from Bank of Scotland PLC (BSCT) and overcoming a determined defense by NatWest's senior management. The deal lifted RBS into third rank among British banks.
RBS (RBOS) shares rose almost 5 percent to 1,098 pence in London Tuesday. 
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Royal Bank of Scotland
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