THE Royal Bank of Scotland announced yesterday that its first quarter’s profits doubled this year under public ownership.

The bank’s quarterly profits doubled from £826 million in the first quarter last year to £1.64 billion this year.

The news prompted a 12 per cent increase in the value of shares in the bank, adding more than £2 billion to RBS’s market value.

Leading economist Michael Burke said the performance of the bank was evidence that the private sector has no superiority or greater efficiency over the public sector. He told the Star: “RBS is beginning to turn around while it remains in public hands.

“It went bust in the private sector. Clearly, there’s no superiority or greater efficiency in the private sector, and no argument for reprivatising it.

“Instead of selling it back to the City at a knockdown price, a very large bank like RBS could be used to direct lending towards real investment in the economy. This would create decent, well-paid jobs, growth and prosperity.”

The bank remains 80 per cent taxpayer-owned after it was bailed out in 2008 and 2009 when it went bust during the financial crisis.

There are fears that once its recovery is complete the Tories will sell it back to their friends in the city for a pittance.

Not even the latest success stopped City sharks reeling out their anti-public sector rhetoric. 

Richard Hunter of Hargreaves Lansdown stockbrokers said: “The streamlining of the bank and a following wind may enable the resumption of a dividend and the removal of the stultifying government stake.”

The bank has already shed more than 6,000 jobs and surviving staff face an uncertain future after chief executive Ross McEwan warned of further “streamlining.”

He said the latest figures showed the “great job” it could achieve while in a “steady state.”

But Mr McEwan added: “We still have a lot of work to do and plenty of issues from the past to reckon with.

“Everyone at RBS is focused squarely on doing everything we can to earn the trust of our customers and in the process change the banking sector for the benefit of the UK.”