Beyond all this red ink may lie a new dawn

RBS's figures today are awash with red ink. The headlines are grabbed, naturally, by the fact this the biggest-ever loss in British corporate history. The writedowns are gargantuan.

But this was all well-flagged, and only to be expected. Government-appointed chairman Sir Philip Hampton and chief executive Stephen Hester have, to mangle metaphors, used their new brooms to brushed everything including the kitchen sink into today's numbers.

Banking analysts and rival banks will pore over details of the losses across a huge variety of toxic assets which RBS created for itself and inherited from its ill-fated takeover of ABN Amro. There will some sharp intakes of breath in the boardrooms and finance departments of the rest of the UK banking industry.

However, Hester has a major advantage over his peer group. With the taxpayer now a 68% shareholder, he clearly has the ear of Government. And in the past few days he has given that ear a proper bashing. Not just on the scale of today's writedowns but also on the amount and terms by which he can access the Asset Protection Scheme. He's done well.

His recovery plan will cost thousands of jobs and greatly slim down RBS and NatWest. No one can call the end of the recession but he has put the right plans in place.

Now all we can do is wait. But come 2014, the Conservatives may well be preparing for a second election victory, their coffers awash with funds from the thousands of citizens who stagged the privatisation of RBS.