RBS sets aside £2bn

LONDON: Britain’s Royal Bank of Scotland (RBS) has set aside another £2 billion to cover mortgage-backed securities litigation in the United States and compensation for credit insurance mis-selling in Britain, it said on Wednesday. Fourth-quarter earnings will be reduced by the equivalent of $2.8 billion or 2.6 billion euros, the state-rescued lender warned in a statement detailing a raft of vast financial provisions. RBS is putting aside £1.5 billion to cover expected legal action on US residential mortgage-backed securities, and an extra £500 million to cover possible compensation for mis-selling payment protection insurance (PPI). The Edinburgh-based company also took an impairment charge of nearly £500 million on the value of its troubled private banking business.