BGN Entrepreneur

According to a new research by the accountancy group of KPMG, banks on the high street will struggle to make any money from providing service to UK customers. The rising unemployment will mean that banks suffer bad debts as customers can no longer keep up with repayments on unsecured loans, such as credit cards.
HSBC Lloyds Banking Group, Royal Bank of Scotland and Barclays all reported profits in their retail divisions for the first six months of the year. The grim picture is at odds with this recent round of reporting from the High Street banks.
Retail banking is still just profitable at lower levels, but with rising impairments it seems probable that it will fall into loss making in the second half of this year. KPMG also says that the retail banking would remain loss-making ‘for the foreseeable future’. The UK retail banking business of the group, which includes NatWest, saw bad debt charges rise by 87% to £824m, causing a 90% slump in operating profits.

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