Part-nationalised Royal Bank of Scotland is set to unveil the biggest annual loss in UK corporate history after a catastrophic 2008.
Chief executive Stephen Hester is also likely to reveal details of plans to split the business in two and for large-scale sell-offs - as well as cost savings that could lead to the axing of tens of thousands of jobs.
A loss of up to £28 billion is expected after bad debts of up to £8 billion and writedowns of as much as £20 billion more on its disastrous acquisition of Dutch bank ABN Amro.
The announcement will come the day after RBS said it will end its sponsorship of the Formula One team Williams at the end of the season in 2010 as a result of the economic downturn.
It also emerged on Wednesday former RBS boss Sir Fred Goodwin is receiving a £650,000 a year pension from the bank.
According to reports, Sir Fred, who presided over the ABN Ambro disaster, has amassed a £16bn pension pot.
Ministers say this is totally unacceptable and have vowed to “claw back” as much as they can.
In 2007 RBS made a pre-tax profit of £10.1bm but taxpayers have since pumped £20bn into the business to keep it afloat, giving them a 70% stake.
Team principal Sir Frank Williams, whose group has been a permanent fixture on the grid for 30 years, said they would battle on.
“RBS has been a great partner for this team and we are grateful for the way that they have handled this difficult situation,” he said.
“We are in a strong position to ride out the inevitable challenges of the next two years.”
The bank also says it plans to review its sponsorship deals with individuals such as tennis star Andy Murray.
“We recognise that we are now operating in a very different economic environment and have been reviewing all of our activities since October,” Dr Andrew McLaughlin, RBS group director, said.
Williams CEO Adam Parr insists the Grove-based team is still in “solid” financial shape despite the impending loss of one of its principal sponsors, the Royal Bank of Scotland.
“Obviously it isn’t good news for the sport for a sponsor like RBS to announce it’s withdrawing,” he said.
“From our point of view we have suspected for some time that there was only a slim chance of the sponsorship continuing beyond its term, and that is the end of 2010.
“The important thing for us is that the board confirmed to us yesterday and confirmed publicly today that they will honour the contract until 2010.”
While RBS is not the only sponsor Williams has lost, Parr pointed to the fact that many of the team’s other partners have recently renewed and in some cases increased their commitment.
Parr said the combination of extra commercial-rights income and the cost-cutting measures that F1 has adopted for this year and beyond would help shore up Williams’s finances.
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