LONDON ( The Deal) -- The European markets were mixed this morning, with London pulled up by its banks -- despite some very ambiguous news from that quarter -- and Paris pulled down by poor results from luxury goods heavyweight LVMH ( LVMUY). Gloom in Germany over the crisis in Ukraine was in stark contrast to Britain's joy over economic growth, which seemed to eclipse worries that sanctions against Russia could hurt Britain's huge financial services sector -- and possibly also its biggest oil companies.
The U.K. economy grew by 0.8% last quarter according to government figures, meaning it is now officially larger than before the start of the financial crisis. And the International Monetary Fund predicted Thursday that GDP would grow 3.2% for the year as a whole -- faster than any other advanced economy.
Majority state-owned Royal Bank of Scotland (RBS) topped the London leaderboard, rising over 15% at one point before sinking back to 372.2 pence, a still-impressive 13.2% above the previous day's close. The Edinburgh bank reported pretax profits for the six months to the end of June would be £2.65 billion -- that's $4.5 billion -- compared with £1.37 billion in the same period last year. Investors also liked the news that impairment losses on bad loans declined by nearly £1.9 billion during the first half of the year, to £269 million.
What's more, the brighter economic environment has sharply reduced the cost of managing and disposing of the assets pushed off into a bad bank last year.