Tech & Biz

RBS reports largest ever annual loss of US$ 34 billion in UK

by Ravi Dixit | February 26, 2009 at 12:09 am

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Today is indeed a grim day for British banking, it is being reported that Royal Bank of Scotland; which was part nationalized by UK tax payers monies has reported an annual loss of US $ 34 billion. This is the largest loss in the corporate history in UK. IT broke the record of Vodaphone that reported a loss of US$ 14 bn in 2006.

Some key highlights:

The bank is cutting down 5,000 jobs across the globe.

Its share prices rose after the results were announced.
Sir Fred Goodwin's pension scheme is also under scrutiny and there is growing public feeling to prune it down.
UK government owned 70% of the bank
It is also being discussed if it is prudent for the government to take over the bank completely.

Last October HBOS, Lloyds and RBS received a booster shot of $ 63 bn of taxpayers monies and were part nationalized.

These bank are now asking the government to insure 325 billion pound of assets. If it goes through it will amount to about 40% of the UK GDP.

Royal Bank of Scotland (RBS) has announced the largest annual loss in UK corporate history.

RBS, which had to be bailed out by the government last year, said that its 2008 loss totalled £24.1bn.

It also said it would put £325bn of toxic assets into a scheme that offers insurance for any future losses.

The Asset Protection Scheme, backed by taxpayers, aims to strengthen bank balance sheets and encourage banks to lend more to firms and individuals.

Share prices of RBS rise 22%

The results were not quite as bad as had been expected, said CNN business anchor Charles Hodson, and they caused RBS shares to rise 22 percent in early Thursday trading.

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poor oligarch (not verified)

at 04:00 on February 26th, 2009

At the same time there's outrage in the media and political pressure on disgraced ex-RBS CEO Sir Fred Goodwin about the massive pension he's taking since resigning aged fifty.

TheGuardian