-=Royal Bank of Scotland Group (RBS) to be renamed as NatWest Group (NWG)

Royal Bank of Scotland Group PLC said Friday that it intends to rename itself as NatWest Group and reduce the size of its investment-banking business, as it reported an increased profit for the fourth quarter of 2019.

The majority-state-owned bank RBS said too much of its potential value is locked in business lines and business models that are “too complex and generating too little return” and it will reduce the size of its NatWest Markets investment-banking business by around a half.

NatWest Markets core income fell to 177 million pounds ($230 million) in 2019 from GBP1.08 billion a year earlier.

The British lender said that it expects between GBP800 million and GBP1.0 billion in strategic costs during 2020 resulting from a refocusing of NatWest Markets and cost cutting.

The London-listed bank made a quarterly pretax profit of GBP1.55 billion compared with GBP572 million for the same period a year earlier.

Market update: S&P 500 post Brexit referendum (24 June 2016)

The S&P 500 fell 3.6 percent to 2,037.35, the most since August 24. The benchmark erased its gain for the year, which reached as much as 3.7 percent earlier this month. It closed at 2,037.30, down 76.02. The Dow dropped 611.21 points, or 3.4 percent, to 17,399.86, amid the biggest retreat since January.  The Nasdaq Composite Index tumbled 4.1 percent, the most in almost five years, to end the day at 4,707.98, a 202.06 point drop.  

U.S. stocks plunged the most in 10 months, joining a selloff in global risk assets on speculation that the U.K. decision to leave the European Union will hamper worldwide growth. Banks and industrial shares capped their worst single-day declines in more than four years.

SPY before (6/23) and after (6/24) the Brexit vote

The pound plunged the most in 30 years and European equities dropped as investors weighed the implications for the global economy.

(click for live chart)

As if results of the U.K. vote wasn’t enough, today is also the date of the annual rebalancing of FTSE Russell’s stock indexes, a procedure that reliably exacerbates trading. In 2015, the reconstitution helped fuel a jump in volume to more than 10 billion shares, the seventh-highest total of the year.

London bookies blew the Brexit call: none of the UK pollsters, bookmakers and city experts realized there was a huge groundswell of anger.

Declines Friday also came after markets had rallied during the past week on optimism the U.K. would vote to remain in the EU, with the S&P 500 rising 1.7 percent in four sessions.

The vote comes at a time when uncertainty already plagues U.S. stocks, with questions around the Fed’s ability to stoke growth after the worst month for hiring since 2010, a four-quarter decline in corporate profits, price-earnings ratios that are close to a decade high and a presidential election looming in the fall.

The S&P 500 plunged 11 percent in its worst-ever start to a year before recovering through April. It’s
virtually been stuck in place since, struggling to hold above the 2,100 level that has capped three rallies since November. It fell from that perch again after closing above it Thursday for the first time in two weeks.

FXB

European banks