RBS issues shares to help shore up bank

Grovelawn Financial News 18/04/2008

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Bank hopes to raise billions through share issue

The Royal Bank of Scotland announced it is preparing to to generate billions of pounds through the issue of shares. Early trading showed a healthy interest in the UK's second largest bank as its share price was expected to climb 4 per cent to 380p. The bank announced the fundraising ahead of its annual shareholders meeting on Wednesday. It is believed that the Financial Services Authority is involved in the discussions with RBS along with the Treasury.

Many large American banks have also raised billions in this way to help recover from the current credit crisis with British banks having been accused of reacting too slowly in following the US's example for fear of upsetting shareholders. The rumours have circulated for some time that around £12billion would be needed to help stave off further meltdown but that some major shareholders would prefer the bank to sell off assets instead. Bank staff have already seen as many as 200 staff in its global banking and markets business loosing their jobs.

← Interest rate cut to 5% | News For April 2008 | Two at the BOE voted against rate cut →

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