When will the UK government give up control of Royal Bank of Scotland and Lloyds bank?
Despite talk just a few weeks ago that the UK government was looking towards a sale of share stakes in Lloyds bank and Royal Bank of Scotland it would appear that taxpayers will have a significant exposure some time to come. A mixture of disappointing figures and reduced liquidity in the market place appears to have placed Lloyds bank and Royal Bank of Scotland at the bottom of the recovery curve.
When you also consider the fact that Lloyds bank is reported to have approached the UK government about a £5 billion funding requirement it would appear that taxpayers will remain an integral part of the banking system for some time to come. However, there are concerns that the UK government, via these share stakes, has a conflict of interest because ultimately while telling the rest of the banking sector to reduce their risk and improve their balance sheets, Royal Bank of Scotland and Lloyds bank are the weakest in these particular arenas.
Lloyds bank in particular have suffered a disastrous fall from grace after the acquisition of HBOS, a deal which many people believed was pushed through by the UK government, and the subsequent revelation of massive bad debts.
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