Can't necessarily understand the timing of this given the losses that it's going to involve. Bailed out for £45.5 Billion and selling at a time when its worth is closer to £32 Billion.
Seems like a chance for investors to get on and make a killing just like the Royal Mail fiasco. Shares for the boys ? Or a good deal for the public ?
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Not a 'good deal' but the best deal and option available. The 'bad deal' was the price paid rather than the one selling at. Would be far too long a wait to get back to 500p a share and unless we really hit deflation our returns are diminishing anyway in real terms. Banks have generally paid pretty hefty fines along the way to the government for bail outs etc so overall the tax payer should be in a reasonable position.
Why as a tax payer would we want to continue to expose ourselves so much to the banking sector anyway, the next recession can't be more than a few years away now.
IMO, totally different to The Post Office which was a float without a market decided share price so always going to be tricky to predict and with the Government desperate to ensure a successful float it was always going to be pitched low.
But I suppose the banks are one of the "lame duck" industries we must continue to support.
The idea that the Banks were bailed out for any reason other than to save ordinary people from losing their pensions and savings, and hundreds of UK businesses going bankrupt, is puerile tosh.
What was wrong was allowing the situation to develop, not saving us from their crass misdeeds.
I hope the aims expressed by the governor of the B of E come to pass, making it clear that banks would be regulated to ensure they would never have such a stranglehold again, so none would be too big to fail. So yes in future failing banks ought to be able to fail and go to the wall and the State compensation scheme would be able to protect the public against losses. That was not the case had so many of our banks been allowed to fail when the crunch came last time.
By the way, the "expense" of the bail out and "cost" of the sell off, is actually a profit since as well as the sale of the shares, many assets acquired as security for failed loans and other commercial assets, have been sold in the meantime and fees have been paid to the Government.
You can argue whether the profit is £10bn or £30bn, but the State has made a profit on the deal which is why it makes sense to get out now and not take any risk with taxpayer money in the share market.
The Ownership of UK Quoted Shares Bulletin provides estimates of ordinary shares holdings in quoted companies in the UK by sector of beneficial ownership (the beneficial owner is the underlying owner, the person or body who receives the benefits of holding the shares, for example income through dividends).
At the end of 2012, the UK stock market was valued at £1,756.3 billion.
Rest of the world investors continue to hold significantly more shares (in terms of value) than any other sector, with the gap between rest of the world ownership and the next highest (individuals) widening in 2012. Rest of the world ownership stood at an estimated 53.2% of the value of the UK stock market at the end of 2012, up from 30.7% in 1998 and 43.4% in 2010.
UK individuals owned an estimated 10.7% by value at the end of 2012, picking up slightly from the record low in 2010 and halting the downward trend seen in recent years.
Unit trusts held an estimated 9.6% by value at the end of 2012, continuing the strong growth seen in recent years
Other financial institutions held an estimated 6.6% by value at the end of 2012, significantly down on the levels in 2010, following strong growth in earlier years.
Insurance companies held an estimated 6.2% by value at the end of 2012, continuing the fall seen in recent years.
Pension funds held an estimated 4.7% by value at the end of 2012, down from 5.6% in 2010, and significantly lower than the levels seen in recent years.
Shares are increasingly held in multiple-ownership pooled accounts, where the beneficial owner is unknown (My comment: to the statistics harvesters - not the mangers of the pooled accounts of course!). These accounted for an estimated 59.4% of the total holdings by value at the end of 2012, up from 44.9% at the end of 2010.
So, in short a majority of UK shares are owned by non-UK entities/individuals and the majority of those are held in nominee accounts.
I haven't posted up the detailed data but note that Insurance Companies and Banks hold a far higher percentage of their assets in shares in manufacturing companies than do individuals, which I guess is good thing in the main.
Anyway, it seems doubtful that those that partially caused the mess will be the same people that benefit from buying the shares. I expect that will be the Chinese and Middle East investment companies.
Now, what happens with derivatives, I suspect, is a different matter altogether.
I would like to see a large chunk sold to private investors at maximum tranches of say £2000.00 to stop the institutions hoovering them all up.
The share price afterwards will be a good indication, have a feeling it'll shoot back up a few billion. It's alright though because we aren't going through a massive cuts regime and need every penny we can raise...
I'm sure you're right, you normally are.
In government and budget deficit terms this is a huge asset which doesn't appear. But once it's sold then the cash will be used to offset government borrowing and the deficit for that year allowing Osborne to be triumphant!
I don't understand why the Greeks are actively objecting to doing something similar to get out of jail but left wing governments like to hoard assets even when in trouble.
I've said for a while now that privatisation raises cash and takes politicians hands off of operational control of banks and railways etc. I hope they continue to sell things to reduce the deficit and ideally raise the tax take as and when entities make profits.
Unmitigated, conceited and unscrupulous idiots the lot of em.
Fuck it, sod the money just napalm 250 and 99 Bishopsgate and target a cruise missile into the foyer at Wankside, that'll do me!
Just leave 280 and 135 alone !!!
All I'm saying is that I worked NatWest/RBS for over 18 years and left company in healthy state in Jan 2007.
They then bought ABN and the problems started !!!!
mugged off.
but never mind, theres a derivatives crash on the way so the funds will only go back to more banks soon enough
The Conservative Party chairman, compared the bank bail-out to Labour’s decision to sell the country’s gold reserves. “Labour sold gold at a record low price and now it seems they massively overpaid for the taxpayer stakes in the banks,” he said.
“Taxpayers will be paying the price for Labour’s mistakes for many years to come — they must never again be let anywhere near our economy.”
In 2015: George Osbourne
George Osborne said the Government will start to sell some of its 80pc stake in RBS to institutional investors in the coming months, as part of a rehabilitation of the rescued lenders that will produce an overall profit of £14bn for the taxpayer, according to new figures.
Muppets!
As for not benefitting from the buy/sale of RBS I would be interested to know the likely loss to the taxpayer had they been allowed to go bust (lost deposits/deposit protection scheme, bust companies leading to redundancies etc etc) so that I could compare with the loss made on sale of the shares. Could someone give me that comparison?
By comparison, Lehman Brothers' balance sheet was just 5% of US GDP.