LONDON, April 17 (Reuters) - Royal Bank of Scotland said on Tuesday it will make a total contribution of 3.5 billion pounds ($5 billion) to its pension scheme, in line with planned changes to the fund’s structure required by ringfencing legislation.
RBS said in a statement that the bank and the pension fund’s trustees had agreed RBS would make a pre-tax payment of just over 2 billion pounds in the second half of this year, with a further 1.5 billion pounds to follow from 2020.
The initial payment will be recognised in the bank’s second quarter figures.
“With these proposed payments ... we will have substantially addressed the historical funding weaknesses that existed in the fund and brought clarity to future funding arrangements,” said Ewen Stevenson, RBS chief financial officer.
He added that the agreement also represented an “important milestone” in the resumption of capital distributions to RBS shareholders. ($1 = 0.6983 pounds) (Reporting by Emma Rumney, editing by Sinead Cruise)