The Royal Bank of Scotland has reduced its operating expenses by £129 million through cost-cutting in technology, property and operations in its Business Services division.
This helped the bank reduce its group operating costs by one percent in Q1 2010, compared with the previous quarter. RBS said last year that it would be moving to a common undisclosed technology platform to deliver the efficiency it needs.
RBS is aiming to deliver at least £2.5 billion in cost reductions by 2011, and says that it has so far achieved over £2 billion in annual cost-savings.
However, in cutting costs, RBS said that there have been job losses, and it warned: “While the most substantial reductions [in jobs] have been completed there are more to come.”
Despite the cost-savings that the bank has achieved so far, RBS still reported a loss of £248 million for the first quarter. Nonetheless, this was a significant improvement on the £765 million loss it recorded in Q4 2009.
Meanwhile, in its UK Retail business, RBS reported in its Q1 2010 results that it “continues to progress towards a more convenient, lower cost operating model”. The business aims to increase the level of automated transactions, which involves “significant” process re-engineering in its branch network and operational centres.
Stephen Hester, chief executive of RBS, said: “Last year we began implementing one of the most significant corporate restructurings ever undertaken. We said the plan would take five years to implement.
“Today, we show that we remain on track for the delivery of the plan. We have made good progress, but there is still significant work to be done.”