Monday, January 19, 2009

MPs Urge Nationalization of Royal Bank of Scotland

by Bill McBride on 1/19/2009 08:53:00 PM

From The Times: Nationalisation calls as RBS teeters on the brink

RBS, worth £75 billion only two years ago, is now valued at £4.5 billion, even though it received £32 billion from taxpayers and shareholders less than three months ago.

The bank’s plight prompted calls for the outright nationalisation of RBS, with some MPs urging the Treasury to take over its day-to-day running.
...
The turmoil suggested that the Government’s second massive rescue package had failed to restore confidence to the financial sector. It was a graphic illustration of continued banking uncertainty that prompted calls on the Government from Labour MPs to nationalise the whole system, an idea resisted firmly by Alistair Darling, the Chancellor, last night.
The most recent bail out will increase public ownership of RBS to 70%, so it's not a huge step to complete nationalization.