RBS in talks to leave APS early

| January 21, 2011 | 0 Comments

There is speculation that the Royal Bank of Scotland (RBS) is in talks with the Treasury about its early exit from the Government’s Asset Protection Scheme (APS).

The scheme, which insurers against losses arising from toxic assets, was established in 2009 to boost confidence in the system following the financial crisis in autumn 2008.

It backed assets in RBS, as well as Lloyds, in return for an agreement on lending levels.

According to a report in the Financial Times, the bank is looking to free itself from the scheme by the end of the year.

However, the bank’s chief executive, Stephen Hester, previously said the bank, which is 83% owned by the taxpayer, would not exit the scheme until 2012.

In other news this week, RBS agreed to sell the Priory Group – the care home and clinic renowned for treating celebrities.

The bank offloaded the business to private equity firm, Advent International, in a deal worth £925 million.

RBS has been selling assets under the orders of the European Commission, as a punishment of the billions of pounds in state aid that RBS received by the Government at the height of the financial crisis.

RBS acquired the Priory Group when it completed its purchase of Dutch bank, ABN Amro. This almost led to the collapse of the bank on the eve of the credit crisis.

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