Shares of Royal Bank of Scotland, owned by the UK government are being sold.
In 2008, during the financial crisis, the government lent a helping hand to RBS with around £45 billion. This contributes to around 7.7% stake in the banks.
The UK government is now selling its stake in the Scottish Bank but at a loss. Now a decade later, the government is selling around 925 million shares in the bank. With this, the government which has been a major stakeholder with 70.1% ownership has reduced its ownership to 62.4%.
By 2019, the government will be selling around $3 billion of its ownership in the bank; by 2023, the government will be selling more of its stake, to a value of around £15 bn.
The sale process will be dealt by institutional investors like Morgan Stanley, Goldman Sachs, JP Morgan and Citigroup. They are authorized to do so by the UK Government Investments which are managing the investment fund of the government.
However, John McDonnell, the Labor’s shadow chancellor does not approve of this sale of shares. The taxpayers have bailed out the bank and it should not be a loss for the taxpayers, he feels.
The shares were valued by the bank at £33.8 billion on Monday.
The bank has posted a profit of $752 m after almost a decade of losses. 162 branches across the country are to be closed. RBS has been serving the rural areas for several years but will be shutting down its branches at its rural communities.
Italy has been witnessing a great deal of political turmoil for several days and has delayed the earlier sale of these shares.
The shares which were trading at around 300p in the month of January 2018 are trading at around 281.1p on Monday.
Shares will have to be extricated slowly but surely, feels the government.
Morgan has been in the position of the business analyst for almost a decade and with such expertise, he is one of the best expert hands with us. His profound understanding of the trade, commerce, and business trends makes him a reliable contributor to blamfluie.com.