Royal Bank of Scotland to be scaled down
This week will see plans unveiled for the substantial scaling down of the Royal Bank of Scotland banking operations. Over the next 3 to 5 years it is expected that 25% of the balance sheet will disappear as the group returns to basics for future stability. The banking operation will also see up to £300 billion of potentially toxic investments moved into its separate operation which will be wound down or sold off in the short to medium term.
The intention to change the make-up of the Royal Bank of Scotland is one of the most controversial and groundbreaking changes to hit the banking sector over the last few years. After literally decades of unbounded growth in appears that the banking sector in the UK will reduce significantly in the short to medium term. The Royal Bank of Scotland reduction plan will probably be the first of a large number in the sector although many observers believe the sector will return to more a high risk strategy in due course.
At this moment in time the billions upon billions of pounds of taxpayer's money being poured into companies such as Royal Bank of Scotland and the banking sector in general have had little impact. The UK government is now in the last chance saloon and under severe pressure to deliver the goods.
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