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| Version 1 | Version 2 |
|---|---|
| 'Challenge' to sell bank stakes | 'Challenge' to sell bank stakes |
| (41 minutes later) | |
| The firm set up to manage taxpayer stakes in nationalised banks has said it will be "challenging" to return the investments to the private sector. | The firm set up to manage taxpayer stakes in nationalised banks has said it will be "challenging" to return the investments to the private sector. |
| UK Financial Investments (UKFI) was set up to manage a 70% stake in Royal Bank of Scotland and a 43.3% holding in Lloyds Banking Group. | UK Financial Investments (UKFI) was set up to manage a 70% stake in Royal Bank of Scotland and a 43.3% holding in Lloyds Banking Group. |
| BBC business editor Robert Peston said these stakes were worth about £60bn. | BBC business editor Robert Peston said these stakes were worth about £60bn. |
| UKFI said the stakes currently showed a paper loss of £10.9bn, and it would take time to sell the shareholdings. | UKFI said the stakes currently showed a paper loss of £10.9bn, and it would take time to sell the shareholdings. |
| UKFI, which has reiterated that it will operate at arms length from the government, said it would maximise the value of the investments for the taxpayer. | UKFI, which has reiterated that it will operate at arms length from the government, said it would maximise the value of the investments for the taxpayer. |
| It also said it would not interfere in the day-to-day running of the banks, but engage strongly on strategic issues. | It also said it would not interfere in the day-to-day running of the banks, but engage strongly on strategic issues. |
| 'Strengthened' | 'Strengthened' |
| "Every UK household will have more than £3,000 invested in shares in RBS and Lloyds," said John Kingman, UKFI chief executive. | "Every UK household will have more than £3,000 invested in shares in RBS and Lloyds," said John Kingman, UKFI chief executive. |
| "Today UKFI is setting out our strategy to deliver on the tasks we have been given: maximising the value of these investments for the taxpayer, and returning the banks as strengthened institutions to full private ownership over time." | "Today UKFI is setting out our strategy to deliver on the tasks we have been given: maximising the value of these investments for the taxpayer, and returning the banks as strengthened institutions to full private ownership over time." |
| These banks belong to us, to taxpayers, and the monetary value of our investment in this duo is huge BBC business editor Robert Peston Read Robert's blog here | These banks belong to us, to taxpayers, and the monetary value of our investment in this duo is huge BBC business editor Robert Peston Read Robert's blog here |
| UKFI did not set out any fixed timetable for disposing of the shares, but said it expected "to undertake a number of capital markets transactions over a sustained period". | UKFI did not set out any fixed timetable for disposing of the shares, but said it expected "to undertake a number of capital markets transactions over a sustained period". |
| Robert Peston said that the stakes could not be sold off right away, and that the government would "stick with these stakes for a considerable amount of time". | Robert Peston said that the stakes could not be sold off right away, and that the government would "stick with these stakes for a considerable amount of time". |
| He also said that at current market prices "the value of the UKFI-managed investments in these banks will be around £60bn". | He also said that at current market prices "the value of the UKFI-managed investments in these banks will be around £60bn". |
| "And, for the avoidance of doubt, if we sold at £60bn we would be selling at a loss - because the market value of taxpayers' initial stake in the two banks is about £11bn less than we paid for those first holdings." | "And, for the avoidance of doubt, if we sold at £60bn we would be selling at a loss - because the market value of taxpayers' initial stake in the two banks is about £11bn less than we paid for those first holdings." |
| Patience needed | Patience needed |
| UKFI said in its report that it was sitting on paper losses of £10.9bn, less than the £18.1bn shortfall registered in February. | UKFI said in its report that it was sitting on paper losses of £10.9bn, less than the £18.1bn shortfall registered in February. |
| "Our own task of returning these investments to the private sector is challenging," UKFI said. | "Our own task of returning these investments to the private sector is challenging," UKFI said. |
| "The amounts involved are very large, and a successful disposal of our holdings will require professionalism and patience. | "The amounts involved are very large, and a successful disposal of our holdings will require professionalism and patience. |
| "We all have a stake in UKFI's success. Skilled disposal of these investments will recoup tens of billions of pounds for the taxpayer." | "We all have a stake in UKFI's success. Skilled disposal of these investments will recoup tens of billions of pounds for the taxpayer." |
| UKFI added it was not "possible or desirable" to say what price or time would trigger a sale of its bank stakes. |