British government sells RBS shares at loss of £1bn to taxpayer

The move has reduced the Government’s stake in the group from 78.3% to around 72.9%.

The British Treasury has sold the first tranche of shares in Royal Bank of Scotland for £2.1 billion, but the taxpayer has made a loss of around £1 billion on the sale.

UK Financial Investments, the body that holds the Government’s RBS stake, said it had offloaded 5.4% of RBS at 330p a share – far short of the 502p price paid by the Government when it bailed out the bank at the height of the financial crisis.

The move has reduced the Government’s stake in the group from 78.3% to around 72.9%.

Chancellor George Osborne said the #2.1 billion would be used to pay down Britain's national debt.

He said: “This is an important first step in returning the bank to private ownership, which is the right thing to do for the taxpayer and for British businesses: it will promote financial stability, lead to a more competitive banking sector, and support the interests of the wider economy.”

Labour has raised concerns over the Government’s rush to offload its stake in RBS when the shares are still languishing below the bailout price paid.

A previous report by investment bank Rothschild said that, if all of the Government’s stake was sold at current prices, the taxpayer would lose around £7 billion.

However, UKFI estimates that the RBS share price will rise as the firm returns to health and more stock is sold to the market.

Mr Osborne said: “The right thing to do for the economy and for taxpayers is to start selling off our stake”.

He added in a tweet that he had the backing of Bank of England governor Mark Carney for the move.

Mr Osborne said on Twitter: “RBS bailed out by last gov. This gov is selling it back. Bank of England Governor says selling now is in ’interests of the wider economy’.”

more courts articles

Gary Glitter victim seeking six-figure sum in damages, court told Gary Glitter victim seeking six-figure sum in damages, court told
Stephen Bear ordered to pay back profits from sharing private sex tape Stephen Bear ordered to pay back profits from sharing private sex tape
Man (25) in court charged with murdering his father and attempted murder of mother Man (25) in court charged with murdering his father and attempted murder of mother

More in this section

FILE PHOTO The Competition and Consumer Protection Commission has cleared the purchase of Goodbody Stockbrokers by AIB END Goodbody Stockbrokers fined over €1.2m by Central Bank over rules breaches
Nottingham City Centre Stock Irish staff at the Body Shop wait for wages as retailer shuts stores in the Republic
Ryanair comments on Norwegian Ryanair boss O'Leary's spat with Transport Minister over Dublin Airport escalates
IE logo
Devices


UNLIMITED ACCESS TO THE IRISH EXAMINER FOR TEAMS AND ORGANISATIONS
FIND OUT MORE

The Business Hub
Newsletter

News and analysis on business, money and jobs from Munster and beyond by our expert team of business writers.

Sign up
ie logo
Puzzles Logo

Play digital puzzles like crosswords, sudoku and a variety of word games including the popular Word Wheel

Lunchtime News
Newsletter

Keep up with the stories of the day with our lunchtime news wrap.

Sign up
Cookie Policy Privacy Policy Brand Safety FAQ Help Contact Us Terms and Conditions

© Examiner Echo Group Limited