The latest study "A Paradox of Forces" by auditors of the KPMG consulting company covers financial results of UK-based five biggest banks: Royal Bank of Scotland (RBS), Lloyds, HSBC, Barclays and Standard Chartered.
#Banks reshaped balance sheets & decreased risk-weighted assets #ParadoxOfForces http://t.co/MMVDb97Zhb pic.twitter.com/TsNuhz3J3M
— KPMG in the UK (@kpmguk) April 7, 2015
#Banks profits up & impairments down — clear signs of recovery but challenges remain #ParadoxOfForces http://t.co/96X8x4Ufmq
— KPMG in the UK (@kpmguk) April 7, 2015
Referring to the issue as "the problem that won't go away," the study shows that more than 60% of the banks' total profits went to cover expenses between 2011 and 2014, with costs totaling up to $58 billion (£38.7 billion).
The banks' profitability results also represent a "mixed picture." The report reveals divergent performance across the top five UK-based banks as the profitability at the two state-backed banks, Lloyds and RBS, continued to rise, whereas it fell at the other three banks.
The report comes amid a wave of financial scandals which hit the biggest UK-based banks over financial misconduct. This included rigging of Libor, the rate at which banks lend to each other and that underpins transactions worth trillions of dollars, forex market rigging, money laundering and profit from violating banks' international trade sanctions.
