ROYAL Bank of Scotland (RBS) announced a £153 million loss yesterday as millions of pounds has been set aside to cover customer compensation payments and legal settlements.

RBS has earmarked £1.3 billion for potential lawsuits and customer repayments and a further £459m has been reserved for misconduct and litigation costs.

The bank has already paid out £400m in fines to US and British regulators over the foreign exchange scandal, and was also one of six banks fined a total of around £3bn for failing to stop traders manipulating currency markets last year.