Royal Bank of Scotland pays first dividend since financial crisis

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Royal Bank of Scotland Group PLC (RBS, RBS.L) reported that its net profit attributable to Ordinary shareholders for the second-quarter dropped to 96 million pounds from 680 million pounds in the previous year.

"Declaration of the interim dividend is subject to the timing of finalisation of the previously announced civil settlement in principle with the DoJ (Dept of Justice) in relation to the DoJ's investigation into RBS's issuance and underwriting of US RMBS (residential mortgage-backed securities)".

The interim dividend will be 2p per share, though the timing of the payout is subject to the finalisation of its U.S. settlement.

With the first dividend in a decade, investor sentiment could improve over the near term. Deutsche Bank upgraded the shares of RBS in report on Monday, March 26 to "Buy" rating.

Marking a landmark moment, the dividend is worth £240m and means the Treasury will receive £149m, as RBS is still 62% owned by the United Kingdom government.

"I'm confident the large legacy issues are behind us.The bank as you're seeing is becoming a much more normal bank, which is very pleasing to see".

"Our intention has always been to get capital back into the hands of shareholders", he said on a conference call with reporters, adding that the bank would want to look at the potential impact of Brexit before making any major payouts.

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The interim dividend payment would return 150 million pounds to government coffers, according to a Reuters calculation.

The resumption of dividend payments paves the way for further share sales. RBS left its guidance for the current year unchanged.

In morning deals, the company's share price jumped 3.3 percent to 258.30 pence on London's rising stock market.

The firm operates through UK Personal & Business Banking, Ulster Bank RoI, Commercial Banking, Private Banking, RBS International, NatWest Markets, Capital Resolution, Williams & Glyn, and Central Items & Other divisions.

However McEwan signaled there could be new trouble ahead for the British economy.

In results for the first-half of the year, RBS posted a 6pc fall in pre-tax profits.

That reputational risk is among several problems that could cloud RBS's otherwise bright outlook.