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LONDON, ENGLAND - THE Royal Bank of Scotland, Britain's second largest bank, is to announce around four billion pounds worth of fresh losses linked to the credit crunch, the Financial Times reported on Saturday.
The report came after media said on Friday that the bank was set to ask shareholders for a massive cash boost after being hit by subprime-linked losses and surging costs related to its takeover of the ABN Amro bank.
It points to the pressures currently facing some of the world's largest financial institutions.
On Friday, US banking giant Citigroup reported a 5.1 billion dollar (S$6.9 billion) net loss during the first quarter and said it would cut an additional 9,000 jobs as it struggles with bad bets on subprime mortgages.
Shares in both RBS and Citigroup rallied on the news amid hopes that banks were close to sorting out their problems.
Without citing sources, the FT said that RBS would unveil the four billion pound (S$10.84 billion) figure next week and its board would meet this weekend to approve the losses and the rights issue.
A European consortium led by RBS and grouping Belgian-Dutch company Fortis and Spain's Banco Santander bought ABN Amro for 100 billion dollars in 2007 in the biggest-ever takeover in the global banking sector.
RBS had revealed that strains from the global squeeze on credit cost the group 2.5 billion pounds last year, in annual earnings published in February.
Asked to comment on the report, RBS spokesman Carolyn McAdam said: 'We're not saying anything beyond that we will update the market next week.'
It holds its shareholders' annual general meeting next Wednesday. -- AFP
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