Royal Bank of Scotland said it has stopped producing commodities research due to an internal review, and an industry source said the bank was also preparing to close down its precious metals trading operation.

"We are conducting a review of our client offering with respect to commodities research, and as a result we will not be producing anything further at this time," a spokeswoman said in an emailed statement in response to a query.

When asked about a possible withdrawal from precious metals trading, the spokeswoman added: "We are constantly reviewing our businesses but have nothing new to advise you on at this time."

The spokeswoman gave no further details.

The move to halt gold and other precious metals trading was part of a wider review at the part-nationalised bank, which is 82 percent-owned by the government, said the source, who declined to be identified.

RBS commodity analysts have been put on "gardening leave", said the source, who noted that no commodity research has been published in about a month.

Commodity analysts include head of commodity research Nick Moore and commodity strategist Nikos Kavalis.

In 2010, RBS and Sempra Energy sold the non-U.S. assets of joint venture RBS Sempra Commodities to JP Morgan for $1.7 billion in cash.

Since then, the only RBS commodity trading operations have been in precious metals.

In January, RBS finally abandoned ambitions to be a top global investment bank, bowing to pressure from the government to shut down risky operations and prepare for tougher international regulations.

It aims to cut the balance sheet of its former global banking and markets business by 120 billion pounds to 300 billion in the next three years.

Last month, the bank reported reported a first-half operating profit of 1.83 billion pounds, down from 1.97 billion in the same period last year. The bank made a statutory pretax loss of 1.5 billion pounds, which included a 2.9 billion pounds accounting loss due to a rise in the value of its own debt.

(Reporting by Eric Onstad; editing by Keiron Henderson)