Royal Bank of Scotland (RBS) will stop lending money to coal companies by the end of the decade, its new chief executive will say on Friday, as she sets out a vision for it to be "a purpose-led" business.

Sky News has learnt that Alison Rose will identify the target among a number of climate-related objectives in a speech to coincide with RBS's annual results.

The deadline for ending the provision of finance to companies in the coal industry will form part of Ms Rose's efforts to spell out how RBS - which is majority-owner by taxpayers - will help its customers transition to a net-zero carbon economy.

Speaking on her first day in the job last November, Ms Rose described climate change as "one of the defining challenges of our lifetime - one that will only become more urgent".

"We'll be taking bold actions to play a driving role in helping the UK transition to a low-carbon economy," she said.


The RBS chief's pledges will come amid a flurry of commitments by big British companies to reduce their environmental impact as pressure grows from politicians, customers and other stakeholders.

This week, Bernard Looney, the new boss of BP, said it would strive to be net-zero carbon by 2050, while a coalition of aviation industry companies made an identical pledge last week.

RBS's rival British bank, Barclays, is under intense pressure to respond to a shareholder resolution - to be voted on at its April annual meeting - demanding that it sets out how it will cease financing carbon polluters.

Ms Rose's maiden set of annual results at RBS will be closely watched for signs that the government will be able to resume selling its 62% stake in the bank in the near term.

Image: Alison Rose took over as chief executive last November

Sky News revealed this month that RBS and its majority shareholder, UK Government Investments (UKGI), had agreed on the payment of a bonus pool worth about £305m for 2019.

The figure will represent a reduction of just under 10% from last year's bonus payments.

Ms Rose is preparing a further shake-up of the group that will include substantial job and cost cuts, and changes to her management team.

Analysts at Barclays forecast that RBS will announce an operating profit of just over £4bn for 2019, and an attributable profit of £1.8bn - with earnings dented by another big charge in the third quarter for payment protection insurance compensation.

If confirmed on Friday, that would be its third consecutive annual profit.

The bank will also confirm that Mark Bailie, the chief executive of Bo, RBS's digital lender, is leaving.

A search is separately underway for a successor to Les Matheson, its chief executive of personal banking.

Ms Rose has already changed the leadership of NatWest Markets, part of RBS's non-ring-fenced bank, with a new chief executive and finance chief to be appointed in the coming months.

RBS, which is 62% owned by the taxpayer following its £45.5bn bailout during the 2008 financial crisis, named a new finance chief, Katie Murray, just over a year ago.

Ms Rose's inheritance from Ross McEwan, who ran RBS for more than five years, includes tackling a still-bloated cost base, continued ultra-low interest rates and global trade tensions.

However, most of the scandals which plagued RBS in the decade after its rescue have now been consigned to the past following settlements costing many billions of pounds.

Its journey back to normality gathered momentum during the latter part of Mr McEwan‎'s tenure, with a £1bn dividend payment to the Treasury at the half-year stage a further indication of the surplus capital RBS is now generating.

If the UK economy performs well during her tenure, Ms Rose will have a reasonable chance of being the chief executive who completes RBS's return to full private ownership.

Under Philip Hammond‎, the former chancellor, the Treasury set a target date of 2024 for offloading the remaining government stake, although the public spending watchdog has cautioned about the anticipated pace of further share sales.

Rishi Sunak, who was installed as chancellor on Thursday after Sajid Javid's surprising resignation, is likely to provide an update to that objective when he announces his Budget in March.

RBS declined to comment on the contents of Ms Rose's speech.