The £153m loss for the six months to the end of June compares with a £1.43bn profit a year ago.
Restructuring costs almost tripled to £1.5bn amid efforts by chief executive Ross McEwan to cut staff and refocus the bank on the UK.
The lender set aside £1.3bn for lawsuits and customer recompense.
Another £459m was earmarked mainly for litigation costs in the second quarter. Most of those are likely to arise from sales of mortgage-backed securities in the US, said the bank.
In May, RBS and Japanese bank Nomura were ordered to pay $806m between them for making false statements when selling the mortgage-backed bonds to US agencies Fannie Mae and Freddie Mac.
The bank's net profit rose to £293m for the three months to the end of June.
"There's a lot of noise," Mr McEwan told BBC Radio 4's Today programme, referring to fines and probable lawsuits, "but underneath is a very strong bank."
"These things are very distracting," he added, "so we need to face into these and put our energies into creating a better bank here in the UK."
RBS was one of six banks fined a total of about £2.8bn for failing to stop traders trying to manipulate currency markets last year.
RBS has already paid £399m in fines to US and UK regulators over the forex scandal.
The bank's capital strength improved after selling a stake in US lender Citizens.
Costs for the bank have fallen, which finance director Ewen Stevenson attributed to smaller staff costs and "getting out of expensive real estate" on a conference call with journalists.
