RBS ends 8 billion pound capital back-up with UK government

Royal Bank of Scotland (RBS.L) has cut itself free from an 8 billion-pound ($13 billion) capital tie to the British government, it said on Tuesday, following recent moves to strengthen its capital base. The ending of the Contingent Capital Facility marks another step along the road to getting RBS in shape for the government to eventually start selling off its 82 percent stake, which it acquired after pumping 45.5 billion pounds into the bank during the 2008 financial crisis. “It is further evidence of the progress we have made in making RBS safer and stronger, with dramatically improved liquidity and capital positions,” the bank said. The facility had acted as an additional buffer whereby the government would have provided further equity capital if the bank’s Core Tier 1 capital solvency ratio fell below 5 percent of risk-adjusted assets.


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