UK plans to sell half of its stake in RBS within two years
The UK government plans on selling half of its stake in Royal Bank of Scotland (RBS) within the next two years, according to reports.
Last month UK Chancellor George Osborne said that over the coming months he wanted to begin selling the government’s £16 billion stake in RBS.
The bank is reportedly planning an initial sale of RBS shares this September to avoid clashing with the full privatisation of Lloyds Banking Group next March – as it would be almost impossible to attract enough demand for both share sales if they were to happen at the same time.
Since the bank was bailed out over five years ago, its shares have plunged in value, which means that initially shares will be sold at a loss, although Osborne expects the sale to boost investor confidence and drive the bank’s share price up.
According to Reuters, final decisions on the sale process have not been made yet. Progress is said to depend on market conditions, the bank’s performance and the outcome of ongoing investigations into potential misconduct that it may have conducted in the past.
The RBS bailout cost UK taxpayers billions of pounds
The bank was bailed out by the British taxpayer during the financial crisis.
A total of £46 billion was pumped by the UK government to prevent the bank from collapsing in 2008 and 2009.
Former RBS chief executive said the sale could take the government up to a decade
Last month RBS Chairman Philip Hampton said that he believes that the government could takes years to complete the sale of its stake in the company.
Former RBS chief executive Stephen Hester stated that the sale could take up to 10 years to complete.