Royal Bank of Scotland chief executive Ross McEwan has signalled there will be no let-up in his cost cutting drive.

The New Zealand born banker told a major financial conference in London that “tackling costs will be a constant goal for us”.

He also expressed a personal view that he would like RBS to use any excess capital to participate in buying back its own shares when the UK government sells down its stake.

Talking about his strategy to transform the bank Mr McEwan said RBS will exceed its £800 million savings goal for 2015 by about £50m as a result of changes to the bank levy. Around £1.1 billion of costs were shaved last year.

However his admission that there are still “significant” costs to be removed over the coming years is likely to cause further uncertainty for RBS staff who have seen the bank shed tens of thousands of jobs since the financial crisis.

At the Bank of America Merrill Lynch Banking & Insurance conference Mr McEwan said: “Our aim to take our costs to income ratio to below 50 per cent remains a key part of our plan.

“I would also like to highlight we have significant future cost opportunities in all parts of the bank.

“Partly tackling the high costs of our franchises that we are repositioning, but also through operational improvements in the UK personal and business banking and also in our commercial bank.”

Mr McEwan went on outline how he wants RBS to be positioned by 2019 with simpler products and greater trust from customers at the heart of his plan.

Asked whether revenue increases had been factored into the financial projections he stated growth is likely to be limited across the industry until interest rates start to rise.

He said: “So it has to be a cost play for us. Over the next three years to 2018 we have substantial amounts to get us down to the cost to income ratio [of 50 per cent].

“At that point there is still more work to do. A bank like ours needs to be in the 40s.”

Mr McEwan suggested some savings will come from reducing the bank’s processes, registered companies and products.

He also remains committed to overhauling RBS’s corporate and institutional business, UK private bank and Ulster Bank. Job losses in the corporate business were estimated to be up to 14,000 by 2019 according to market estimates published earlier this year.

He said: “We have a clear plan to materially reduce costs and improve their productivity. Ulster Bank and [the] private bank currently have unacceptably high levels of costs in the businesses and require repositioning as leaner, more efficient franchises.

“Our corporate and institutional bank is undergoing a multi-year transformational programme, as well as re-shaping the business in line with our go-forward proposition we will need to re-platform many parts of this business, particularly its back office processes, to materially lower its cost base.”

Asked about potentially returning capital to shareholders Mr McEwan told the audience of analysts and investors the bank had not changed its view that the first quarter of 2017 was the earliest that is likely to happen.

He said: “We have to get ourselves into a position where the PRA is comfortable with us returning money through any of those forms back to our shareholders.

“My own personal view, this isn’t agreed with board, [is] I would rather participate as the government is selling down in the buybacks, be part of that exercise.

“At some stage we would like to put a dividend policy in place but I would like to actually participate, I think it is the best thing for all investors where excess capital goes back through buyback.”

The UK Government still has a 73 per cent stake in RBS but made its first share sale, at a loss of around £1bn, earlier this year.