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The government is in a desperate race to try and refloat the UK economy before we see a major collapse in the UK employment market. A recent flurry of announcements from various recruitment...
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Saturday 14th June 2008
It seems that each week we hear about a possible additional asset sale at Royal Bank of Scotland as the group scrambles to shore up the ailing capital base of the main banking division. The latest move involves the sale of the company’s rolling stock operation Angel Trains to a consortium led by Babcock & Brown. The move is significant and brings an extra £3.5 billion into the groups operations at a time when many are unsure whether the £12 billion raised in the recent rights issue will be enough.
When you also take into account the proposed sale of the insurance division, for a further £7 billion, there really does seem to be an unhealthy urgency to sell the ‘family silver’. Many in the City believe that the company’s recent spate of large acquisitions may have stretched the group finances a little too far and it is now paying the price.
The management also revealed plans to raise an additional £4 billion from further asset sales this year, further highlighting the weakened position of the group’s finances. While it would be wrong to single out RBS as the weakest in the sector, they seem to be in more of a rush than most to raise as much capital as they can. |
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