ROYAL Bank of Scotland boss Ross McEwan has warned further branch closures are inevitable, as the state-backed lender yesterday reported its first quarterly profit since September 2015.

The Edinburgh-based bank, which received a £45 billion bailout by taxpayers at the height of the financial crisis, gave the order in March to close a further 158 branches over a six-month period.

Thirty of those branches are in Scotland, with the decision expected to hit around 470 jobs in total.

Mr McEwan, who said the bank is on course to deliver its first annual profit in more than a decade in 2018, said further closures will be on the cards given the rapid shift by consumers to banking digitally.

Asked whether customers can expect RBS to close more branches this year, he said: “I think we will see it across the industry, more branch closures over the next five years. The issue is customers are not using them as they used to. Usage is down.”

On Royal Bank’s own plans to close branches, Mr McEwan said: “We have already announced our situation for the next six months. We’ve announced just recently 158 branches [will close]. We’ve given six months’ notice, we’ve put in lead behind the situation so that the customers are well looked after, so we have already announced our situation for the next six months.”

As RBS unveiled a first quarter profit of £259 million, which compared with £968m loss at the same stage last year, Mr McEwan claimed that branch closures were less about savings and led more by the “dramatic change” towards people using digital banking, including mobile phones, post offices and mobile banks. The bank said it is on track to cut running costs by £750m this year, having made savings of £278m in the opening quarter. Mr McEwan said: “There’s a real change around how people are banking today. It doesn’t matter whether it’s the individual customers or the very large customers. That’s where we need to direct our investment. That’s why you are seeing major changes there.”

Royal Bank has slashed tens of thousands of jobs and closed hundreds of branches to cut costs since being bailed out by the UK Government at the height of the financial crisis of 2008 and 2009.

Chancellor Philip Hammond admitted last week that the Government is facing a multi-billion pound loss when it comes to selling its 72 per cent stake in the lender.

The bank also faced criticism from MPs this week over a £125 million legal bill relating to a case brought by investors over its controversial share issue of 2008, due to come to court next month.

Asked whether the bank should apologise to taxpayers if the public does not get the investment it made in the institution back in full, Mr McEwan said: “I think we have go to back to why the government of the day stepped in to and rescue Royal Bank of Scotland.

“It is such a fundamental part of the financial fabric of the UK, the government had to step in. We would have had a major, major difficulty in the financial services sector [if it had not done that].”