Friday, Apr 18, 2008
RBS plans 12billion rights issue
Telegraph: Royal Bank of Scotland Chief Sir Fred's future on the line
Royal Bank of Scotland is planning a rights issue of up to £12bn to shore up its weakened balance sheet. The move comes after months of speculation that the UK's second biggest bank would have to appeal to shareholders for money. RBS has consistently indicated that it would not have to do a rights issue. RBS has decided to tap shareholders for capital due to worsening sub-prime writedowns and its already fragile tier one position, which makes it the most leveraged of Europe's banks. Goldman Sachs and Merrill Lynch are arranging the rights issue. Analysts estimate that RBS needs to raise £5bn-£12bn to repair its balance sheet and also expect a dividend cut. The move is believed to have been prompted by further sub-prime provisions on top of the £2.4bn already reported.
13 Comments
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1. sold 2 rent 1 said...
The business guy on Sky News this morning was really nervous with this story.
He emphasised that this was NOT a run on the bank - 3 times.
More "fifth night" destruction coming up.
2. tyrellcorporation said...
Just sold my shares in RBS and may buy back in IF the dust settles. After seeing what happened to share prices in NR it doesn't bode well in the short term - I could be wrong though.
3. malct said...
s2r1
likewise Declan Currant on BBC very nervous, very keen to strees this isn't a run on another bank - yet
I've posted the BBC online version above
4. malct said...
stress even
5. theboltonfury said...
gents, I think you're getting carried away here to support your own fifth night stuff. There is much much worse stuff going on in the world you choose to ignore because it doesn't fit with your own agenda. I've not noticed once S2R mentioning Tibet or the continual starving in Africa as 5th night. This is small fry and honestly, who cares?
This is surely a good thing to ask the shareholders rather than the taxpayer to bail them out. Besides it has been very prevalent recently in the US
6. Lloyd said...
Are any UK banks solvent any more? Most banks that have sub prime assets on their books are now responsible for the on going cost of servicing these sub prime assets, mostly in derelect sites in run down areas of the US, with rampant crime. The costs are crippling and yet to be brought to the attention of the shareholders who will soon to realise that shares worth £180 are in fact worth -$0.80. The FED and BoE are now saddling the public with these worthless bits of paper. The game is up and UK High St banks are going bust and we are all going to pay a very high price for the abject failure of the Banks, Goverment and so called regulatory authorities! The £ and $ in your pocket is now approaching 40% of it value 1 yr on.
7. Rentinginthesouth said...
Good call boltonfury.. -
Don't think this is a particularly big story - RBS will be absolutely fine.. it's all to do with brand perception of the public - and the public's opinion of those brands is top quality (i.e. Direct Line, Natwest).... Crock only went under as the brand / company radiated 'value' and offered loose mortgage deals...
8. the northerner living in oz said...
This is the way banks should be bailed out with shareholders money
If they do not like it then vote to sack the directors at the next shareholders meeting.
If only NR had done this a few years ago.
9. theboltonfury said...
Llyod, you not seen the record profits being announced buy the likes of HSBC and Barclays? They just don't want to use their own pot of gold to pay for their mistakes, and as Brown knows that they decide if he keeps his job, he does what they request
10. sold 2 rent 1 said...
theboltonfury,
Whilst I agree Tibet or the continual starving in Africa are much bigger stories, they are all linked together.
What we are witnessing here is the abuse of the masses by the power elite reaching "exhaustion" levels on a worldwide scale.
Food riots, worldwide hpc, currency devaluations, Tibet, Mugabe, corporate/political corruption etc are all part of this destruction process that is needed for CHANGE to take place.
What is clear is that there is still not enough destruction for this change to happen.
Why?
Maugabe is still power
Ron Paul is still relatively unknown
False flag operations are thought to be conspiracy theories by the masses
US and EU have not pulled their crazy bio-fuel targets
EU Treaty of Lisbon has not been exposed for what it really is.
No prosecutions of the bankers/corporate execs/politicians yet.
This destruction process will continue to accelerate into May and June until a tipping point is reached.
A new consciousness can only be born from the destruction of the old one.
11. malct said...
surely the relevance of the RBS news is as a measure of the scale of what is happening.
12. p. doff said...
s2r1 @ 10
'This destruction process will continue to accelerate into May and June until a tipping point is reached'.
Not too long to wait now. By June we will know whether to salute you or call you a plonker.
Please promise that if nothing noteworthy happens you will stop banging on about it.
13. sold 2 rent 1 said...
p. doff,
will do.