Royal Bank of Scotland (RBS) – the owner of the country’s fourth largest vehicle leasing company, Lombard Vehicle Management – has posted a £15m profit for the first six months of the year.

This compares to a loss of £726m for the same period last year.

However, the bank, of which the taxpayer has a majority stake, was downbeat pointing out that when impairments, operating losses and operating expenses were calculated in, it made a £1bn net loss.

“Our first half results, as we had clearly warned, are poor with a net attributable loss of £1,042 million,” said Stephen Hester, group chief executive.

“However, they highlight well our core business potential, the hard work of our people in difficult times, the strength of our customer franchises and the vulnerabilities and economic headwinds we grapple with.”

The Lombard brand is accounted for by the bank under its UK Corporate division.

The division made a £872m profit before impairment losses.

Impairment losses are special, non-recurring one-off charges that occur when an asset has an overstated value, such as a bad loan or a tangible asset such as a vehicle.

When the asset is re-valued, the bank suffers an impairment loss.

With impairment losses, the UK Corporate division still made a £321m profit during the first six months of the year.