Economy

Why the RBS share price could be a bargain after dividend news

Why the RBS share price could be a bargain after dividend news

Recently, In analysts note revealed to investors on Friday, 3 August, Royal Bank of Scotland Group The PLC (LON:RBS) shares have had their Hold Rating maintained by professional analysts at Shore Capital, who now has a GBX 285.00 PT on company.

Gordon believes that as well as a hefty regular payout, the state-owned lender could commit to a special dividend and share buybacks.

Statutory profits of £1.8bn included £810m of net litigation and conduct costs, including £1bn taken in the second quarter in respect of the US penalty to the US Department of Justice over misselling of mortgage-backed securities and £350m of restructuring costs.

The bank added further distributions are not likely to happen until 2019.

RBS reported an operating profit before tax of £1.8bn for the first half of this year, down from £1.95bn a year earlier.

Chief executive Ross McEwan had previously said he wanted to reinstate the dividend as soon as possible after resolving a long-standing $4.9bn (£3.7bn) fine with U.S. regulators for past misconduct in May.

Andy Murray in tears after gruelling victory over Marius Copil
I don't think I should be put in a position like that, when you're expected to come out and perform the next day. Showers earlier in the week jumbled the schedule and forced some other men to play two matches on Thursday.

Marking a landmark moment, the dividend is worth £240m and means the Treasury will receive £149m, as RBS is still 62% owned by the United Kingdom government. The ability to get back into paying dividends.

"The most important sign of an increased health of the bank came in the form of the announcement of the first interim dividend since the financial crisis of 2 pence per share, this - combined with the better-than-expected profit figures - has contributed to the share price rising in early morning trading by a few percentage points".

"However, with our major legacy issues largely behind us, we are able to fully focus on closing this gap". The decline reflected the impact of the adoption of IFRS 9 accounting standards, lower income in the NatWest Markets investment banking arm and a £156mln gain on the disposal of its stake in payments and cashpoint processing firm Vocalink a year ago.

It also expands the market for future government share sales by enabling a broader array of investors to look at buying the bank's shares.

RBS CEO Ross McEwan said the bank was pleased with its progress, even in an uncertain and highly competitive environment. That's 12% higher than during the same period past year.


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