Dec. 9 (Bloomberg) -- Royal Bank of Scotland Group Plc, the U.K.'s second-largest bank by assets, said pretax earnings may rise 10 percent this year, buoyed by acquisitions and higher lending to companies and home buyers.

Royal Bank is ``confident'' of meeting analysts' estimates, the Edinburgh-based lender said in a Regulatory News Service statement today. Analysts estimate income before tax, goodwill and integration costs will rise to about 7.9 billion pounds ($15 billion), from 7.15 billion pounds last year.

``Our results continue to show good momentum across our broad range of businesses,'' Chief Executive Fred Goodwin, 46, said in today's the statement.

Royal Bank of Scotland, the world's sixth-biggest bank by market value, is tapping the U.S. market for revenue growth. In May, the bank agreed to buy Cleveland-based Charter One Financial Inc. for $10.5 billion. That followed the February purchase of Connecticut-based People's Bank's credit-card unit.

Shares in Royal Bank have gained 0.2 percent this year, making it the fourth-worst performer on the 10-member FTSE 350 Banks Index, which rose 2.4 percent.

In the first half, Royal Bank's revenue rose 20 percent to 10.9 billion pounds. Excluding acquisitions, it gained 11 percent. Net income rose 21 percent to 2.11 billion pounds. Profit before tax and goodwill amortization was 7.15 billion pounds in 2003.

Its net interest margin, a measure of loan profitability, narrowed to 2.92 percent in the first half from 2.96 percent, hurt by the start of a new credit-card offering 0 percent interest and as it sold more low-risk mortgages after the purchase last year of First Active Plc of Ireland. The cost-income ratio, a measure of efficiency, improved to 40.5 percent from 43 percent.

To contact the reporter on this story: Jonathan Rosenthal in London at jrosenthal1@bloomberg.net

Last Updated: December 9, 2004 02:24 EST