RBS repay everything

[Old Hack]

The Government paid for £45.5bn for an 84% stake in RBS and £20.3bn for a 43% stake in Lloyds. This is distinct from the loans.

84% of RBS is currently worth ~ £23bn
43% of Lloyds is worth ~ £10bn

So there is a sizeable loss involved if they were to be sold at the present moment.

I don't really understand accounting properly, but have these loans been written down? What I mean by that, is that if we sold them, would it be considered profit, if its been written off?

[scooby]

The Government paid for £45.5bn for an 84% stake in RBS and £20.3bn for a 43% stake in Lloyds. This is distinct from the loans.

84% of RBS is currently worth ~ £23bn
43% of Lloyds is worth ~ £10bn

So there is a sizeable loss involved if they were to be sold at the present moment.

But, the point is they have repaid the loans... The shares will be sold when the government are ready, therefore it is up to them to make a profit on an investment. Dont forget any dividends paid will go to the gov.

Question, will gov be forced to pay CGT on profit?

[doodab]

I don't really understand accounting properly, but have these loans been written down? What I mean by that, is that if we sold them, would it be considered profit, if its been written off?

These aren't loans. This is the money the government spent buying those shares. Whether they are marked to market in the national accounts I have no idea but I don't think they work quite the same way as a corporate profit and loss account.

But, the point is they have repaid the loans... The shares will be sold when the government are ready, therefore it is up to them to make a profit on an investment. Dont forget any dividends paid will go to the gov.

No. The point is that although it's up to them to make a profit on the shares they probably aren't going to.

[scooby]

No. The point is that although it's up to them to make a profit on the shares they probably aren't going to.

No, the point is, RBS have done their bit by paying back the loans, it's now down to the Gov to make a profit / return. That is not RBS responsibility.

[doodab]

No, the point is, RBS have done their bit by paying back the loans, it's now down to the Gov to make a profit / return. That is not RBS responsibility.

Yes it is, just as much as it is the responsibility of every other board of every other company to create value for shareholders.

[scooby]

Yes it is, just as much as it is the responsibility of every other board of every other company to create value for shareholders.

OK, slightly pedantic, but yes agreed.

They still dont have a say on when shareholders should sell, that was my point, so therefore that IS down to the gov, not RBS.

[lilelvis2000]

The Government paid for £45.5bn for an 84% stake in RBS and £20.3bn for a 43% stake in Lloyds. This is distinct from the loans.

84% of RBS is currently worth ~ £23bn
43% of Lloyds is worth ~ £10bn

So there is a sizeable loss involved if they were to be sold at the present moment.

So the government (ie the people) are no better at investing than I am.

[minestrone]

We have to take on that a UK Bank can never get into that situation again. We should be happy that the bank has paid off what was given to them by the state as security and we must be happy that we own this bank which can be sold.

For all the sins of the last goverment they got their sorry arses in gear in keeping RBS, Lloyds and NR going. I am no fan of New Labour but I though Darling done a pretty decent job in that respect.

Onwards and upwards.