Broker snap: Nomura expects a £2bn loss at RBS

1st Aug 2011 13:18

Nomura has maintained its reduce recommendation on Royal Bank of Scotland (RBS) ahead of the bank's first half results due on Friday 5 August.The broker expects RBS to report a pre-tax loss of £2bn. Even after stripping out provisions for payment protection insurance and other non-operating charges, operating pre-tax profits would be just £371m in the second quarter, down from £1bn in the first, due to a lower contribution from Global Banking and Markets, the broker says. "We continue to regard RBS as relatively unattractive compared with the other UK banking groups, due to the level of earnings power we see in the ongoing core businesses," said analyst Robert Law.A target price of 41p is kept.Shares were trading 1.2% lower at 35.27p at 13:17 on Monday.