Government sells shares in RBS at £2bn loss

Shares were sold at 271p each, almost half the 502p they were purchased for during the bank’s bailout a decade ago, bringing the taxpayer’s stake in RBS down to 62.4 percent from 70.1 percent.

The value of the sale of the 925 million shares is more than £2.5bn, the Treasury said, and the government sold its shares in an overnight placing managed by UK Government Investments (UKGI).

The government has said it intends to sell £15bn worth of RBS shares by 2023.

Chancellor of the Exchequer, Philip Hammond, said: “This sale represents a significant step in returning RBS to full private ownership and putting the financial crisis behind us.

“The government should not be in the business of owning banks. The proceeds of this sale will go towards reducing our national debt - this is the right thing to do for taxpayers as we build an economy that is fit for the future.”

However, shadow chancellor John McDonnell said there was “no economic justification” for the sale at such a “large loss” to the taxpayer.

RBS CEO, Ross McEwan, said: “I am pleased that the government has decided the time is now right to re-start the share sale process. This is an important moment for RBS and an important step in returning the bank to private ownership.”

In February, the bank reported an annual profit of £752m – its first for a decade and a sharp turnaround from the £6.95bn loss seen the previous year. Despite that, it announced in May that it will be cutting 162 branches and 792 jobs after the decision in 2016 to shelve a project to launch challenger bank Williams & Glyn.