Breakingviews

UK retreat from RBS is more important than value

March 6, 2015

Chancellor George Osborne now wants to return the bank rapidly to private hands after May’s election. Both strategy and governance have been flawed. Britain is wary of starting to reduce its 79 pct stake at a loss. But that’s a price worth paying to put RBS on a stable footing.

FX fines are wake-up call on self-policing

November 12, 2014

The $3.4 bln settlement for five banks works out on average at 20 pct higher than Libor – because the firms failed to mend their ways. Regulators are seeking yet tougher internal controls. Banks have a last chance to show they can treat clients fairly.

UK banks have much to fear from latest probe

July 18, 2014

Britain’s top antitrust watchdog has warned lenders to expect a full-blown competition investigation. Forced divestments would be a surprising outcome. But given the persistence of concern in spite of past probes, investors should brace for radical, profit-sapping remedies.

RBS shows watchdogs need power to stop M&A

December 12, 2011

Many of the factors identified in the Financial Services Authority's 452-page report into the lender's near-collapse and rescue are relics of a different era. However, when it comes to big bank takeovers, further changes are still needed.

Fred Goodwin’s title clawback sets bad precedent

January 31, 2012

The disgraced former Royal Bank of Scotland chief executive has been stripped of his knighthood. The politically motivated move may stoke rather than sate anti-banker anger. Moreover, it devalues one of the few non-financial rewards that could be used to motivate bankers.

RBS pulls off tricky bonus balancing act

February 24, 2012

The bonus pool in the investment bank is sharply down. That’s politically convenient. But the comp ratio has shot back up to 41 pct, making RBS look like a competitive payer. Adjust for some quirks in the numbers and in reality not much has changed overall from last year.

State stranglehold on RBS now only slightly looser

May 4, 2012

The UK bank is close to repaying emergency funding from 2008, and met expectations in Q1 despite revamping its investment bank. But government insurance, a block on paying dividends and a huge public shareholding remain. RBS’s main task is to start unpicking this triple lock.

RBS’s CEO succession gains urgency post Panditgate

October 19, 2012

Recent wins mean Stephen Hester has achieved much of his turnaround plan that was due to end in 2013. Meanwhile, Vikram Pandit’s ugly exit from Citi shows it’s wise for bank bosses to quit while ahead. RBS’s board should put two and two together and prepare for life after Hester.

RBS moves away from Libor danger zone

February 6, 2013

The UK bank has avoided a franchise-destroying U.S criminal liability. The 390 mln stg fine - more than Barclays, much less than UBS - should be bearable. But the UK government still has many other problems to deal with before it can sell its 81 pct stake.

Drip-drip Libor shame beats an industry settlement

February 7, 2013

RBS traders stupidly bragged of “Libor fixing” over email. Each bank’s settlement heaps new humiliation on the sector. UBS chair Axel Weber wants an industry settlement to help banks move on. But prolonging the pain by singling firms out helps society hold banks to account.