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UK government won't divest RBS stake soon, it says

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UK government won't divest RBS stake soon, it says

The British government may not further reduce its 72% stake in Royal Bank of Scotland Group Plc before the end of the decade, The Telegraph reported Jan. 26, citing Chancellor Philip Hammond.

"We should regard it as a long-term asset and we should liquidate it at a point in time when we can get the best value for money for UK taxpayers," Hammond said on the sidelines of a trip to Microsoft's offices in Reading, according to the report.

On Jan. 26, Royal Bank of Scotland said it would book £3.1 billion due to penalties imposed by the U.S. Department of Justice for misselling residential mortgage-backed securities. This takes the total amount set aside for U.S. penalties by RBS to £6.7 billion.

In November 2016, James Leigh-Pemberton, chairman of UK Financial Investments Ltd., the agency that manages U.K. government stakes in banks, had said that uncertainty over RBS' RMBS settlements was making it difficult for the government to sell its stake.