Royal Bank of Scotland is expected to make billions of pounds of further write-downs in respect of risky financial assets in the second half, details of which could be released this week.

Royal Bank of Scotland is expected to make billions of pounds of further write-downs in respect of risky financial assets in the second half, details of which could be released this week.

Analysts predict that after writing down £5.9bn in the first half, the Edinburgh-headquartered giant will make further hefty provisions to reflect the marked deterioration in credit markets in recent months, with forecasts ranging from £1bn to £3bn.

The details of the new write-downs are expected to be included in the prospectus for the giant capital raising which is being completed by Royal, which said it would be published in October.

While the government has committed to underwrite efforts to raise £15bn by issuing ordinary shares, the bank will be keen to win as much support as possible for the offer from private shareholders.

However, efforts to drum up support for the 65.5p per share offering could be hampered by any confirmation that the problems caused by worsening conditions in credit markets is likely to take a significant toll on Royal's balance sheet. Shares in Royal slipped 6% yesterday, leaving them adrift of the offer price.

Several brokerages have now made predictions that Royal will make significant further write-downs in respect of the value of assets such as structured credit products.

Sandy Chen, analyst at Panmure, forecasts Royal will record up to £6.8bn of write-downs and impairments in the second half.

Mark Phin, at Keefe, Bruyette & Woods, last week estimated Royal would post another £2bn of write-downs.

Shares in Royal Bank closed down 3.625p at 57.25p.

Meanwhile, shares in HBOS rose 2%, or 1.125p, to 61p in a development one analyst said was driven by Prime Minister Gordon Brown's comments that the proposed takeover by Lloyds TSB would definitely proceed.