RBS (RBS): Q1 pretax loss of £1.4B, widening from a £116M loss in Q1 2011. Much of the loss came...

RBS (RBS): Q1 pretax loss of £1.4B, widening from a £116M loss in Q1 2011. Much of the loss came from changes in the valuation of RBS' debt. Operating profit of £1.2B vs. £800M consensus. Sets aside an extra £125M for PPI claims. Will repay next week the last of its state emergency loans and resume dividend payments on preferential shares. Shares +2.9% in London.
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Comments (5)
  • Zheeeem
    , contributor
    Comments (445) | Send Message
    Resume payment on the preferred shares indeed. $0.01 per share? Yikes. From page ix of the RBS report: "The Directors have declared the discretionary dividends on Series M, N, P, Q, R, S, and T noncumulative dollar preference shares of US$0.01 each for the three months to 30 June 2012..."


    Well, I guess $0.01 is infinitely better than $0.00.
    4 May 2012, 04:40 AM Reply Like
  • jerryfocone
    , contributor
    Comment (1) | Send Message
    I think you are refeering to common stock they cannot pay on prefereds until they resume on common stock
    4 May 2012, 08:30 AM Reply Like
  • Zheeeem
    , contributor
    Comments (445) | Send Message
    What makes you think that?
    4 May 2012, 09:46 AM Reply Like
  • Daniel Su
    , contributor
    Comments (14) | Send Message
    If you are interested in RBS common stock or preferred stock,
    Great article by Reuters




    Actually RBS needs to pay preferred holders first, before resuming paying dividends on Common stockholders, but there are many challenges ahead:
    1.first they plan to payoff part of the emergency loans first provided by US FED and B of England.
    2 resume paying preferred dividends suspended by EU financial commission,
    3. Potential losses from financial impact of Southern European countries.
    4 RBS need to raise the capital level.
    5. UK government will control the bank until RBS stock goes up above the government purchase price, then exist the control of the Bank. Politicians who supported RBS bail out are not willing to show losses on government investment, so it will be probably another year and half to 2 years, before RBS can assess the financial condition before they are able to pay common stock holder dividends.
    5 May 2012, 02:54 PM Reply Like
  • larry1171
    , contributor
    Comment (1) | Send Message
    I never heard od Dividends on common stock having to be paid before dividends on Pref Stock can be resumed. Pref always takes precedence over common, that's why it's called preferred.
    5 May 2012, 04:18 PM Reply Like
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