Taxpayers showing £1 billion paper profit on Royal Bank of Scotland stake
At a time when the UK banking sector appears to be on the up many analysts had been rather downbeat on the immediate future of Royal Bank of Scotland and Lloyd bank. However, while Lloyds bank still has its own problems with regards to the HBOS loan book and a £10 billion plus bad debt there seems to be growing optimism with regards to Royal Bank of Scotland and the short, medium and long-term future of the group.
Today's rise of just over 10% in the share price of Royal Bank of Scotland now gives UK taxpayers a £1 billion paper profit on a 70% stake in the business which will surprise many people. While the situation at Lloyds bank is a lot more complicated because of the HBOS issue, it seems that Royal Bank of Scotland could well announce figures in line with or even better than analyst forecasts. If this is the case, there is potential for further upside in the short term and ultimately with the UK government known to be a forced seller of the 70% stake in the operation there could be takeover rumours and speculation swirling over the business in the coming months.
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