Qualified advisers answering your
Financial Questions
call 0800 092 1245

UK government to part nationalise UK banks

The main concept of the £50 billion rescue deal announced today by the UK government is the ability for the UKs largest banks to request additional capital in exchange for the government taking a stake in their businesses. But how will this work? Is there a risk to tax payer's money?

One part of the deal which will no doubted miss the headlines is the fact that this is a wholly voluntary scheme and while the Royal Bank of Scotland has already announced that it wants to use the facility, no other UK banks have come forward as yet. This now begs the question as to whether the UK tax payers money will be used to shore up banks with are not able to attract commercial lending because of their underlying quality of business.

Could UK tax payers end up supporting the system by the very fact the option is there for all banks but end up taking equity stakes in the more risky banks of the sector?

To put the investment into context, £50 billion equates to over £1,000 for every many woman and child in the UK and is a serious investment and a serious risk in current market conditions. There is also speculation as to how the government will be able to sell the idea of owning stakes across the board while having nationalised fully the likes of Northern Rock and Bradford and Bingley. Is there not a conflict of interests here?

Share this..

Related stories

Financial Guides

Financial Calculators

Our useful calculators can help you get your finances in order:

Latest News


Helpful new tax year facts that could affect you and your money

Blog | Seven helpful new 2016/2017 tax year facts that could affect you and your money. Our recent online blog shares a brief outline on how to stay up to date.

Read more

Useful Links

Popular Searches

Please Enter More Details

Enter More Details