You don't get the sense that the British government is not working too hard to avoid the complete nationalisation of some UK banks. There has been talk of a "bad bank" to take on the toxic assets housed by these institutions but at around forty pence the private shareholders of Royal Bank of Scotland (RBS) look like they are flying the white flag. The share price would be healthier if it could unload a few assets into the bad bank and if it could do it now.
www.searchifa.co.uk
So if the British government took full control of RBS the next day there would be calls for the sale of the U.S banking interests due to local fears of unfair competition. It would be impossible to get a good price for these American assets, which cost an absolute fortune to build up, because it would be a forced sale.
The current management of RBS might feel it is a good idea to sell off the international interests but retreating to a tough UK banking market dominated by the behemoth Lloyds does not sound a good idea. RBS has just sold a small stake in a Chinese bank but the original purchase must have been based on some kind of game plan, which was not completely wrong.
I suppose a UK taxpayer rescue and foreign assets do not compute.
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