RBS in the red for ninth year in a row as losses more than treble to £6.96bn

Royal Bank of Scotland (LSE: RBS.L - news) has chalked up its ninth year in the red as annual losses more than trebled to £6.96bn.

Chief (Taiwan OTC: 3345.TWO - news) executive Ross McEwan insisted that the "remarkable journey" - which has seen losses of more than £58bn since the bank was rescued by taxpayers - was entering its final phase but acknowledged there was more pain to come.

The state-backed lender has remained mired in multi-billion pound costs linked to the financial crisis a decade ago when it careered out of control.

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Now (Frankfurt: 11N.F - news) it faces a further period of change as Mr McEwan sets his sights on cost cutbacks of £2bn over the next four years, including £750m this year to help it return to profit.

He acknowledged this will mean more job losses.

RBS - which includes NatWest - has already axed thousands of roles through branch closures in recent years as more customers bank online.

The latest annual loss was more than three times the figure of £1.98bn for the year before.

The £58bn lost since the bailout dwarfs the annual gross domestic products of many small countries - including Luxembourg, which has a GDP of about £46bn.

Shares (Berlin: DI6.BE - news) closed more than 4% lower.

RBS remains 72% owned by the state, and the result leaves the bank looking some way from a return to the private sector after its £46bn bailout.

Mr McEwan said RBS was aiming to return to profit by 2018 - meaning it will have endured a full decade of losses under majority state ownership - as the impact of "legacy issues" finally begin to fade.

He said: "This is a bank that has been on a remarkable journey. We still have further to go.

"But the next three years will not be the same as the past three.

"Legacy issues will take up a decreasing amount of our time and focus."

Instead the bank would focus on customers, costs and efforts to return to profit - which would represent "a significant step towards being able to start repaying UK taxpayers for their support".

RBS' annual report disclosed that despite the large, and widening, losses for 2016, staff bonuses totalled £343m, down only 8% on the year before.

The chief executive was paid £3.5m, little changed from 2015. There was no annual bonus but he received a long-term incentive award up slightly to more than £1m.

The bonus total since the rescue now stands at £4.6bn - a tenth of the money poured into the bank by the state.

The bank's latest results saw it weighed down by litigation and conduct costs of £5.87bn.

That included a recently announced additional £3.11bn set aside over US allegations over the mis-selling of mortgage-backed financial products ahead of the financial crisis.

RBS also took a £2.11bn hit for the cost of restructuring, including £750m set aside for a plan to enable it to avoid having to sell off hundreds of branches under the Williams & Glyn brand.

Mr McEwan said: "The bottom line loss we have reported today is, of course, disappointing but given the scale of the legacy issues we worked through in 2016, it should not come as a surprise.

"These costs are a stark reminder of what happens to a bank when things go wrong and you lose focus on the customer, as this bank did before the financial crisis."

He said the core RBS business, stripping out legacy issues and its toxic 'bad bank' assets, generated profits of £4.2bn.

"This bank has great potential," said Mr McEwan.

"We believe that by going further on cost reduction and faster on digital transformation we will deliver a simpler, safer and even more customer-focused bank."