So much for the continuity candidate.
Some in the City had expected Alison Rose to bring more of the same long, wearying restructuring of her old boss Ross McEwan.
Instead, she’s pulled out a machete and taken swingeing swipes at the bank that’s paid her wages for the past three decades.
Not only has she axed the bad old Fred Goodwin-era name of RBS, but she’s finally taking real action to deal with the running sore of NatWest Markets.
Both moves were a long time coming.
RBS was the name Fred the Shred used for his kamikaze takeovers around the world. As brands go, it was about as reputable as Lehman Brothers.
NatWest Markets has been a drain for far too long. Once Rose is through the costs of slashing it, she’ll have freed £3 billion to be deployed elsewhere and staunched the losses. Good call.
But while she’s made a good start, massive hurdles remain. Today’s profits beat forecasts, but only after they’d been cut before. And, though it’s grim news for the poor souls who work there, costs are still way too high. With a cost-income ratio of 58% against Lloyds’ 46.5%, her plan to cut £250 million from total overheads of £7 billion this year looks meek.
Meanwhile, these are the worst of times for banks to make money. Interest rates are too low to make a margin on lending, the economy is listless and regulations tough. None are set to improve soon.
If the government is as hell-bent on selling its stake in the bank as it says, it may as well do it soon. There seems little point waiting around for the share price to rise.