Tax payers own majority stake in Royal Bank of Scotland

Posted by admin on 29 November, 2008 under Business news | Be the First to Comment

The Royal Bank of Scotland Group (RBS) has just come to the market for more cash and the offer was only taken up by a small percentage of shareholders.

The shares in RBS have been trading around the 54-55p mark, but the share issue was at 65.5p, so it is no wonder the take up was under 1% of the total.

The small take-up had been expected as the offer price of 65.5p was about 10p higher than the price at which the shares were trading. The Royal Bank of Scotland, which owns Natwest Bank, needed to raise £20 billion and now that the offer has all but failed, the government will need to bail the bank out and will end up owing just under 58% of the shares.

To think that back in 2007 shares in RBS were trading at over £7 per share and as a result of being affected badly by the sub-prime loans, the bank has had to be bailed out!