RBS shares slip after first-quarter net loss

Royal Bank of Scotland (RBS) reported a net loss of £446 million ($687 million) in the first quarter of 2015 and highlighted that $1.3 billion will be set aside for further potential misconduct charges.

The net loss was sharply lower than the £1.6 billion profit the bank - which is still majority owned by the U.K. government - reported for the same period last year. The loss was attributable to £856 million which it paid for conduct and litigation charges during the quarter, as well as restructuring costs of £453 million.

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The statement, released Thursday morning, also said that £334 million was being put aside for further potential foreign exchange issues. It comes as several banks are being investigated for alleged market manipulation.

Operating expenses would total £856 million of litigation and conduct charges, it said, which also included charges relating to mortgage-backed securities and investigations in the United States.

Shares of RBS slipped 2 percent during the morning session on Thursday. Analysts at Citi said the results were broadly in line with consensus, except revenues, which were 4 percent lower than the bank had predicted.

The Citi team - led by analyst Andrew Coombs - added in a research note that restructuring and litigation charges would likely weigh on the shares and reiterated its "sell" rating on the U.K. bank.

Since the financial crisis and a series of misconduct investigations, RBS has announced a new strategic direction with the aim of building a bank that earns its customers' trust.

The bank had to be bailed out during the financial crash of 2008 and has tried to move away from the reputation it gained under controversial CEO Fred Goodwin during this period.

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The bank also stated that it remained committed to delivering an £800 million cost reduction in 2015.

"RBS has continued to make good progress on its transformation plan, with further steps taken to improve resilience and simplicity in the bank's structures and systems," it said in the accompanying press release.

"RBS remains committed to achieving its target of being number one bank for customer service, trust and advocacy by 2020."