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RBS, Lloyds Get $51 Billion in Second Bank Bailout

Posted By admin On November 3, 2009 @ 5:22 am In Money Watch | Comments Disabled

Jon Menon and Andrew MacAskill
Bloomberg [1]
Tuesday, Nov 3rd, 2009

Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc will receive 31.3 billion pounds ($51 billion) in a second bailout from the U.K. taxpayer as the two banks agreed to cap bonuses.

The Treasury will inject 25.5 billion pounds of capital into RBS, for a total of 45.5 billion pounds, making it the costliest bailout of any bank worldwide. The government will fund about a quarter of Lloyds’s 21 billion-pound fundraising. Both banks said they won’t pay cash bonuses to workers earning more than 39,000 pounds this year.

The rescue will bring the government closer to full ownership over RBS, while Lloyds will escape government control. Lloyds CEO Eric Daniels will raise funds from money managers to avoid the Treasury’s asset insurance plan that would give the government a majority stake. He’s betting bad loans will decline after the Bank of England said the country’s recession was nearly over. In contrast, Stephen Hester, RBS’s CEO, will accept greater government oversight and insure 282 billion pounds of his banks’ riskiest assets with the Treasury.

“There is now a very fine line between RBS being nationalized,” said Danny Gabay, director of Fathom Consulting in London and a former Bank of England economist. “This contrasts with Lloyds willing to fight harder for its independence.”

Full article here [1]

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RBS, Lloyds Get $51 Billion in Second Bank Bailout  FOTR 340x169 PP [3]


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[1] Bloomberg : http://www.bloomberg.com/apps/news?pid=20601087&sid=a9MBFPNg_6mY&pos=1

[2] Buy the DVD here: http://infowars-shop.stores.yahoo.net/faofreprofba.html

[3] Image: http://prisonplanet.tv/signup.html

[4] Lloyds TSB to Buy HBOS for $22 Billion as Credit Crisis Widens: http://www.prisonplanet.com/lloyds-tsb-to-buy-hbos-for-22-billion-as-credit-crisis-widens.html

[5] Royal Bank of Scotland to pay staff £1 billion in bonuses: http://www.prisonplanet.com/royal-bank-of-scotland-to-pay-staff-1-billion-in-bonuses.html

[6] U.S. Taxpayers Lose $1.3 Billion in Chrysler Bailout: http://www.prisonplanet.com/u-s-taxpayers-lose-1-3-billion-in-chrysler-bailout.html

[7] Lloyds’ £1bn profit from pension cuts: Anger as alert issued on boardroom pay: http://www.prisonplanet.com/lloyds-1bn-profit-from-pension-cuts-anger-as-alert-issued-on-boardroom-pay.html

[8] Citigroup to repay $20 billion in bailout money: http://www.prisonplanet.com/citigroup-to-repay-20-billion-in-bailout-money.html

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