The Dividend Access Share, which gives the government priority over dividends, was issued in 2009 when the government paid £25.5 billion to bail out the bank.
Excluding the DAS dividend, the Bank made an attributable profit of £225 million notwithstanding IFRS volatility losses of £356 million, restructuring costs of £238 million and an impairment charge of £223 million largely related to its shipping portfolio.
Income remained broadly stable compared with Q1 2015 across RBS' core Personal & Business Banking and Commercial & Private Banking franchises.
In Q1 2016, core PBB and CPB net loans and advances grew by 15% on an annualised basis with strong growth in both the mortgage and commercial businesses.
Operating expenses fell from £3.61bn in Q1 2015 to £2.42bn due to a sharp drop in litigation costs, which fell from £856m to £31m.
In its Q1 statement, RBS admitted "that there is a significant risk" the separation and divestment of Williams & Glyn will not be achieved by 31 December 2017, and is currently exploring alternative means.
RBS says that "due to the complexities of Williams & Glyn's customer and product mix, the programme to create a cloned banking platform continues to be very challenging and the timetable to achieve separation is uncertain".
RBS is exploring alternative means to achieve separation and divestment, but admitted that the overall financial impact on RBS is now likely to be "significantly greater than previously estimated".
