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Coutts and Adam & Co profits climb 29% on cost cuts

Coutts and Adam & Co profits climb 29% on cost cuts

Coutts and Adam & Co continued to reap the benefits of a squeeze on costs as operating profit rose 29% on the same period of 2018.

The private banking division of RBS reported £80 million in profit in the first quarter. Total income increased by £9 million, up 4.9% on Q1 2018. This was due to increased deposits and higher lending balances.

Having squeezed outgoings 12% lower last year, primarily via a programme of redundancies, the house continued to chip away at costs, with operating expenses of £117 million versus £121 million previously.

Coutts chief executive officer Peter Flavel (pictured) said: 'We experienced solid and impressive financial results last year and it is encouraging to see Q1’s 2019 continuing to please.

'As our new strategy and operating model embeds, it is imperative that we remain progressive and forward thinking especially as we continue to attract a broader client base that reflects today’s society.'

Coutts and Adam & Co cut staffing almost 10% between late 2017 and late 2018 as it sought to offset 'increased back-office operations costs', which increased 4% over the period on new compliance obligations.

The unit reported a £1.4 billion increase in assets under management compared with Q4 2018 following December's deep market sell-off.

Shares in parent group RBS tumbled 4.5% this morning despite an expectations-beating operating profit of £1 billion, as it warned on short-term Brexit uncertainty. 

Chief executive Ross McEwan yesterday announced he would step down from the business next year having restored the business to profitability and overseen a reinstatement of its dividend.



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