Banking News RBS Shares Rise Amid Rumours Of Restructuring 2961
RBS shares rise amid rumours of restructuring
23 February 2009 / by Rebecca Sargent
Shares in RBS are currently at 227p, up from 193p on Friday. The rumours responsible for the hike suggest that RBS chief Stephen Hester will announce a radical overhaul of the bank when it makes its loss announcements on Thursday.
Last month RBS announced that it expects to reveal losses of up to £8billion at its 2008 results announcement this week. Speaking at the time, RBS Group chief executive Stephen Hester said:
“With enhanced core capital, removal of the preference share dividend and the prospect of further asset and liquidity measures, RBS is able to continue its strategic restructuring purposefully.”
However, further restructuring of RBS is expected to be revealed on Thursday, including the creation of a separate division for up to £300billion of ‘non-core’ assets which will be sold or closed down, as well as signing up to the Government’s proposed asset protection scheme to insure loans worth around £200billion against future losses.
Mr Hester is also expected to announce as many as 20,000 job cuts as the part nationalised bank tries to shore up its balance sheet and hold steady.
As yet RBS has not responded to the media reports which escalated over the weekend. When questioned about it on yesterday’s broadcast of the BBC’s Politics Show, City minister Lord Myners said:
“I think it’s for the Royal Bank of Scotland to tell their shareholders and they will be doing that, I imagine at the end of this week, when they announce their profits for, or losses for 2008.”
© Fair Investment Company Ltd