In the wake of the the U.K's vote to leave the European Union and the Bank of England's blockbuster policy intervention, the Royal Bank of Scotland(RBS) - Get Report has abandoned plans to spin off its Williams & Glyn asset as a standalone business.

The news came as the bank reported widening quarterly and first half losses and warned of further charges to come in the remainder of the year.

"We have stopped work on the separation...the current environment undermines the ability of W&G to survive as a standalone entity" said CEO Ross McEwan on a conference call. "Williams & Glyn was to be stood up as a full service retail and commercial bank...but needs would now struggle to grow its balance sheet enough to generate returns above its cost of capital in the next five years," added McEwan.

Williams & Glyn is the name RBS has given to a group of about 300 branches the European Commission told RBS it would have to sell by the end of 2017 in return for its approval of a credit-crisis era government bailout.  RBS said it was rethinking an IPO plan for the branches back in December after interest from suitors. Its original deal to sell the branches to Banco Santander for £1.65 billion ($2.2 billion) collapsed in August 2010, though Santander recently submitted a new bid.

RBS said that it is in discussions with several parties about Williams & Glyn, but called the talks preliminary.

RBS shares were recently down 5.1% at 182.3 pence pence.

The Bank of England cut the bank rate to a record low of 25 basis points on Thursday and, although it announced measures to reduce the impact upon bank profitability.

RBS disappointed the market on Friday when it announced its first-half statutory loss had widened to just more than £2 billion ($2.6 billion) and that it had swung to an operating loss in the first half of 2016.

The first-half statutory loss compared with a loss of £179 million reported for the same period of 2015, and was driven by increased litigation and disposal charges.

It also swung to an operating loss of  £274 million, compared with £261 million reported profit of 2015. Even after adjusting to strip out the effects of some of one-time items, operating profits fell by 60% to £1.1 billion.

Net interest income fell by around 2% for the first half of the year, from £4.42 billion, to £4.33 billion. The net interest margin rose slightly from 2.14% in the first half of 2015 to 2.18% in 2016.

Tangible net assets fell from 351.0 pence per share in the first half of 2015 to 345.0 pence in 2016. This leaves the stock trading at 0.53 times its tangible net asset value, or at a 47% discount to book value, which is broadly in line with that of other large U.K banks.

However, management warn that they still expect to take around £1.5 billion in charges as a result of losses on disposals of risk-weighted-assets, much of which will come in the remainder of 2016.

The group said that litigation issues and other charges mask what the board believes is a strong result, highlighting the bank's adjusted return on tangible equity of 11% for the second quarter and 10.9% for the first half of the year.

"The U.K is our home market and that banks reflect the economies they serve...but we like the long term fundamentals," McEwan said.

RBS saw a slowdown in mortgage applications following the referendum, although it acknowledges that some of this was a seasonal fluctuation. It said consumer spending had remained stable and that management now see opportunity for their investment bank in foreign exchange and rates markets given the prospect of increased volatility during the coming years.