Speaking at the Parliamentary Commission on Banking Standards, Bank of England governor Sir Mervyn King has said that RBS should be split into a healthy and a bad bank, calling for "decisive restructuring" which he said "shouldn't take more than a year".
Merv wants to split RBS into good/bad banks, privatise good part in a year's time. Big change from strategy so far.— Tim Wallace (@Tim_Wallace) March 6, 2013
Merv says taxpayer has taken loss on RBS, needs to accept it and move on. Restructure and sell off RBS, sharpish.— Tim Wallace (@Tim_Wallace) March 6, 2013
The governor described the semi-nationalisation of the bank as a "nonsense". He added that we would need to face up to the fact that RBS is "worth less than we thought".
There are fears that as Osborne becomes more of an activist in the way in which it deals with RBS then this meddling could hurt the taxpayer. King's calls to restructure the bank pose a similar threat.
King: "The whole idea of running an 82% owned bank at arms length is a nonsense" put there for good reason...— Faisal Islam (@faisalislam) March 6, 2013