Annual results from the 83% government-owned bank showed it returned to the black with profits of £12m in the last three months of 2010.
And it sharply reduced full-year losses to £1.1bn from £3.6bn a year earlier.
'Every taxpayer in the UK has a stake in Royal Bank of Scotland. That's why our latest results should be positive news,' Mr Hester wrote in the Daily Mail today. 'We know the taxpayer wants to get its money back.'
The RBS chief executive, who is under fire after scooping a £2m bonus in deferred shares, also promised the bank would play its part in securing the UK's economic recovery.
He claimed RBS was committed to lending to small and medium-sized businesses, to serving customers better and to making the bank safer.
RBS's annual results missed City forecasts, and the bank's shares were down 1.12p at 46.2p in morning trading. But Mr Hester said the group was ahead of its original five-year recovery plan.
'The opportunity to sell part of the UK Government's shareholding becomes increasingly visible and appealing - a "win-win" for the taxpayer and for RBS,' he commented.
'That moment will be an emblem of our progress and, in some respects, of progress in the wider UK.'
RBS saw a rise in bad debt charges in the fourth quarter as it took a hit in its Ulster Bank subsidiary from the Irish economic woes. But on an underlying basis, it clawed its way out of the red with operating profits of £1.9bn, compared with losses of £6.1bn in 2009.
The bank had revealed its controversial bonus plans already. As well as Mr Hester's bonus, its investment bankers are to share less than £950m, lower than the £1.3bn in 2009.
But RBS revealed today that the so-called compensation ratio for investment bankers within Global Banking & Markets - given as a percentage of revenues - rose last year to 34% from 26% despite a fall in revenues at the division.
Mr Hester said the bank had also agreed, as part of the Project Merlin deal with the Government, to lend 'at least as much' to small businesses in 2011 as in 2010, with further lending set aside if demand increases.
His pledge to improve customer service, - including a new charter based on customer feedback – comes a month after the bank was hit with a massive fine for failing to deal with complaints adequately.
Read more: Stephen Hester's defence of RBS's record
Its RBS and NatWest retail bank arms were ordered to pay £2.8m after FSA officials reviewed a sample of around 120 complaints. Its probe revealed delays, poor quality investigations of complaints, correspondence that failed to address problems, and failures to disclose Ombudsman referral rights.
Len McCluskey, general secretary of the Unite union, claimed taxpayers would by 'baffled' as to why a state-owned bank continued to reward investment bankers so handsomely.
'This is an institution in which over 21,000 frontline and support staff have been sacked and RBS still refuse to lend enough to small businesses but bonuses are free-flowing,' he said.
'Because of our taxpayer funding, RBS is gradually recovering from the mess caused by their greedy bankers. Yet the Chancellor continues to tolerate the award of some £950m in bonuses to the culprits, instead of ensuring our taxes do not become worthless.'
BUY, SELL, HOLD
There are currently 16 broker(s) tracking this stock. The results are:
STRONG BUY: 0
BUY: 6
HOLD : 6
SELL: 4
STRONG SELL: 0
UPDATED: 24/02/2011 07:55 pm
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Latest prices for RBS - updated every 2 mins subject to a 15 min delay
OFFER (Buy): 46.6p
BID (Sell): 45.02p
MID PRICE: 45.81p
CHANGE TODAY: -1.72p
PREVIOUS CLOSE: 47.32p
UPDATED: 24/02/2011 07:50 pm
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