The Royal Bank of Scotland’s chairman hinted strongly today that the government would be able to sell on its stake in the bank by the middle of 2014.

Chairman Sir Philip Hampton said that the recovery, which saw the involvement of the government in bailing out the bank over bad loans, would be “substantially complete” by the middle of 2014.

The announcement comes as RBS posted a pre-tax profit in the first quarter of £826 million, while the UK government looks at a series of major cuts over the coming years and a general election in 2015.

Despite the comments made by the chairman, RBS may struggle to recover by 2014, with a fall in earnings in investment operations and the yet to be seen impact of PPI claims.

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