RBS included in Asset Protection Sheme

Grovelawn Financial News 26/02/2009

← Foxtons breaches its banking covenants. | News For February 2009 | Isa from Abbey with a 3.5% pay out →

Government agrees on funding

RBS has been told by the Treasury that it has reached an agreement that will include the stricken bank in its Asset Protection Scheme. RBS will receive a capital injection of £13 billion and a commitment from the Government to subscribe for an additional £6 billion at RBS’s option.

RBS has assets of £325 billion and will pay the scheme in the region of £6.5 billion to the Treasury in capital.

The scheme introduced by the Government was a part of a bigger compensation package to support the banks. It provides protection against future losses on the more risky assets enabling the banks to offer confidence and trust amongst financial institutions and its customers.

To be included in the scheme the banks have to pay a fee and promise to increase the amount of lending they offer to borrowers including businesses. The banks taking part will be required to review their remuneration policy and meet the highest international standards of transparency.

← Foxtons breaches its banking covenants. | News For February 2009 | Isa from Abbey with a 3.5% pay out →

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