Its first-half results showed pre-tax profit of £1.374bn, a reversal of the £1.682bn loss it made in the first half of 2012.

Group operating profit increased 5% to £1.678bn over the reporting period, and net attributable profit was £535m, compared to a loss of more than £2bn in H1 2012.

The bank paid out £3895m in regulatory and legal costs, and a further £185m for PPI claims. RBS has now set aside a total of £2.4bn over the mis-selling of PPI.

The bank’s management will now look to boost the bank’s share price to the point at which the government will sell down its 81% stake in the lender. RBS shares today are at 333.5p.

Outgoing chief executive Stephen Hester, who is to be replaced by retail head Ross McEwan, commented:

“RBS Group has earned its first two consecutive quarters of overall profit since 2008. We report first half pre-tax profits totalling £1.374bn.

The results of our successful restructuring continue to show benefits – capital strength and liquidity up, balance sheet, non-core assets and non-core/Irish losses all down, again.

“The business challenges ahead lie principally in improving future operating trends and sustaining the focus and consistency needed to make further progress. RBS can be a ‘really good bank’ for customers and shareholders. That is our goal.”