It is amazing that RBS continues to astound with their unprecedented financial performance, this time posting a stunning annual profit (LOSS) FYE 2008 of (GBP 40 billion) (statutory loss). They will NEED to raise yet MORE capital to comply with regulators and capital adequacy requirements and after their earlier rights issue of GBP14 billion where the shareholders were “taken to the cleaners” there is NO appetite for any institutional investors to take up any more equity for a very long time. This means there is only ONE source of capital now and that is H M Treasury. It is expected that the resulting shareholding by the UK Government in RBS will ascend to about 95%. Nationalisation is a done deal. Lloyds is next, wait for it!
What does this do to feed the avarice of the City’s bankers? Given the current RBS feud ; “he said, she said…” over Sir Fred’s entitlements at the time of his exit and (not so) confidential telephone conversations and well publicised letters exchanged, it appears the fight is far from over. It is a nice treat to be granted a GBP 693,000 annual pension (for life) as a reward for outstanding achievement in the field of……. redefining, and leading failure to new heights.
Those banks who were cunning enough to avoid dipping into the public purse (so far) like HSBC and Barclays Bank will be squirming in their seats as their avarice has not gone unnoticed. Certainly HSBC is contemplating going to shareholders for a capital top up and that should be treated with scepticism and of course we all know the “managed” placement by Investment Bankers to Middle Eastern investors on outrageous terms and conditions will not protect Barclays in the long run because they too, will ultimately NEED to dip into H M Treasury to continue their existance, it is just a question of time. When it happens say goodbye to Varley and Diamond who have for years been lining their pockets at shareholders expense with outrageous salaries and bonuses and other perquistes. A look at the Barclays annual report will reveal the depth of their avarice laid bare. So far they have done “everything” within their power to protect their access to the golden egg, alas it can’t last. The public, the regulators, the shareholders and even SOME Boards of Directors are on to you!
