The bank, which made a pre-tax profit of £826m in quarter one, provided £3.6bn in gross mortgage lending. More than £327m was offered in association with the Bank of England’s cheap funding scheme in the first quarter of the year.
Mortgage lending activity was slightly down on the previous quarter due to the training and re-accrediting of the lender’s mortgage advisers. RBS also launched a specialist financial advice business for investment and protection.
Chief executive Stephen Hester said the results showed pleasing progress: “We expect to substantially complete the bank’s restructuring phase during 2014. We are seeing the start of a pick-up in loan demand and have a strong surplus of funds ready and available to fully support economic recovery.
“Across the group we are working hard to improve what we do for customers and to better position the bank for future growth.”
RBS’ announcement marks the bank’s return to profits for the first time since quarter three 2011.
Forbearance on existing mortgages – including loans where customers were up-to-date but had altered contractual terms – continued to grow.
Ulster Bank impairment losses declined by £78m and the pace of arrears formation had slowed, the report said.
In the US, two of the bank’s other subsidiaries consented with regulators’ demands to pay $10m in civil monetary penalties.
