Government may make RBS update as early as Autumn Statement, as it considers what Brexit vote means for offloading stake

Hayley Kirton
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View of a Royal Bank of Scotland building
Shares in the bailed out bank are currently worth much less than they were in 2008 (Source: Getty)

The government entity that controls the taxpayers' stake in RBS is still weighing whether to sell down its holding. It could make an announcement as early as the Autumn Statement.

Last year UKFI sold down its stake in RBS from 78 per cent to 73 per cent for £2.1bn, which represented a £1bn loss for taxpayers who bailed out the bank at the height of the financial crisis.

Headed by Oliver Holbourn, it is carefully considering what Brexit means for any potential sales.

Sources say it is unlikely a sale will be announced imminently but a logical time for an update on government's thinking could be the Autumn Statement on 23 November, City A.M. understands.

The hold up can partly be pinned on RBS' falling share price. Closing at 185.5p today, the shares are now worth 63 per cent less than they were at the time government snatched them up in 2008 at 502p.

Read more: Long overdue RBS report finally lands on watchdog's desk

Shortly after the Leave decision was announced, the bank's chief executive, Ross McEwan, revealed the referendum result could delay the government's sale of its remaining holding by another two years.

And, in a recent letter calling on the National Audit Office to examine the advice given to government before its first sell off, Treasury select committee chair Andrew Tyrie noted that Brexit was likely to buy some time for a review, as it would probably delay any further sale decisions.

The uncertainty surrounding the sale of the Williams & Glyn unit, which RBS was told to get rid of as part of its bailout deal, is also likely giving government pause for thought as well.

Last month, it was reported that Santander, often thought of the lender most likely to make the purchase, had decided to back away from the negotiating table because the price simply wasn't right.

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