Royal Bank of Scotland (RBS) has brought some relief to the banking sector by assuring investors that its performance is "on track".

The confident tone was in sharp contrast to rivals Barclays and Lloyds TSB which both issued gloomy trading statements last week.

In short, our overall progress remains entirely on track

Fred Goodwin, RBS chief executive

RBS said it "continued to make good progress" this year and that its results were expected to show a significant lift in income.

Chief executive Fred Goodwin noted that the economic outlook remained uncertain.

But he said "our bias towards less volatile activities in less volatile geographies" meant the group was not exposed to countries such as Argentina, where the economic crisis has hit many banks.

Outshining rivals

The statement from RBS, Britain's second largest bank, followed disappointing results from rivals last week.

Barclays warned investors that its profits would now fall at the lower end of analysts' expectations, while Lloyds TSB announced it was putting more than �165m aside to cover mis-sold endowment mortgages and pensions.

Royal Bank remains the fastest growing bank in the UK, way ahead of the pack

John Tyce, SG Securities

RBS meanwhile said its annual profits for the year to December would meet targets and that bad debts, which have plagued many banks, had not got worse.

"In short, our overall progress remains entirely on track," said Mr Goodwin.

'Ahead of the pack'

In August, RBS reported a 15% rise in profits for the first six months of the year.

Its figures were boosted by strong sales at its Direct Line insurance unit and US-based Citizens bank.

Analysts cheered the group's upbeat statement this morning, with shares rising 1% to �15.42 in early trading.

"Royal Bank remains the fastest growing bank in the UK, way ahead of the pack," said John Tyce, an analyst at SG Securities.

Mr Tyce also said the RBS's US bank would withstand a downturn in the economy.

"Citizens is a deposit led bank, and one of the things that people do as the economy slows down is deposit more," he said.

The group said it was still considering further acquisitions in the US but that it was in no hurry.

"We see lots of opportunities, but Citizens is growing strongly at the moment so we don't need to go out and make an acquisition," said Mr Goodwin.