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RBS avoids 'bad bank' split

Royal Bank of Scotland today reported a sharp fall in operating profits to £438 million for the third quarter, from £909 million a year earlier. The bank is also to create an internal 'bad bank' with £38bn of problem assets, avoiding a full split.

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RBS refuses to deny 'bad bank' split was bargaining chip

The RBS boss Ross McEwan has told ITV News that the bank has "established very good relationship with government". But he refused to deny that a 'good/bad' bank split was always a bargaining chip used by government to get RBS to do what it wanted.

In an interview to be broadcast on ITV News later, when Mr McEwan was asked about his relationship with Chancellor George Osborne, he said: "He and I seem to be getting on fine."

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