RBS
The logo of the Royal Bank of Scotland is seen at an office in London, Feb. 6, 2013. In an unscheduled announcement, Britain’s largest state-owned lender RBS announced a fresh wave of provisions to cover a range of issues, including a looming settlement with U.S. authorities over the sale of mortgage-backed securities. REUTERS/Neil Hall

In an unscheduled announcement Wednesday, Royal Bank of Scotland (RBS) Group disclosed a fresh wave of provisions to cover a range of issues, including a looming settlement with U.S. authorities over the sale of mortgage-backed securities — a legacy of the subprime crisis.

Britain’s largest state-owned lender said in a statement that it is setting aside 1.5 billion pounds ($2.15 billion) to cover litigation claims over sale of toxic mortgage securities in the U.S. and 500 million pounds ($716 million) to cover the wrongful sales of payment protection insurance — wherein millions of people were sold insurance they didn’t need. Additionally, the bank will also write down the value of its private banking business by 498 million pounds ($713 million).

Cumulatively, this would have a roughly $3.6 billion impact on the bank’s fourth-quarter profits, which are due to be announced on Feb. 26.

The troubled lender, which is 73 percent owned by the British government, will also make a one-off, lump-sum payment of 4.2 billion pounds ($6 billion) into its pension scheme due to changes in its accounting policy and to cover an accounting deficit.

“I am determined to put the issues of the past behind us, and make sure RBS is a stronger, safer bank. We will now continue to move further and faster in 2016 to cleanup the bank and improve our core businesses,” RBS CEO Ross McEwan said, in the statement. “We've always been open about the scale of past issues facing RBS and although there is clearly much more to do, this announcement is a further step towards addressing legacy issues and building a great bank for our customers and delivering long term value for our shareholders.”

During early trade Wednesday, London-listed stocks of RBS, which have already fallen over 14 percent this year, were trading down 2.5 percent.