RBS loses 60% as investors flee UK banks

Institutional investors have spent the day fleeing stocks in the UK banking sector, after the UK government announced an extended bail-out plan, and RBS posted the biggest loss in UK corporate history.

At the time of writing, shares in RBS had plummeted to 12.7p per share, a fall of 63% on the day, and a fall of over 90% year on year.

Other bank stocks were also hit, with Lloyds (LLOY) losing almost 40%, Barclays (BARC) down 8% and even the otherwise ironclad HSBC (HSBA) share price down 12% so far today.

However, while other banking stocks have started to recover from lows reached around 13:30 GMT, RBS shares are still down over 60% on the day.

With nearly two and a half hours of trading left, the expectation is that private investors will continue to snap up the obscene bargains available in the UK banking sector.

Even still, investors remain bearish on UK banks, even though RBS and Lloyds especially will be able to pass off bad debts to the UK government under todays announced insurance scheme.

Additionally, RBS remains both adequately capitalised and supported by the UK government, so fears of collapse appear extreme.

In the meantime, RBS shares are now reported to be at a record 23 year low, and despite government action, investors remain bearish indeed.

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