RBS Fail Bank of England Stress Test

Jon Banking, Economy, Government, Market Commentary

Ulster Bank Parent RBS Fails Bank of England Stress Test
‘Royal Bank of Scotland (RBS)(RBS. L) will cut costs and sell assets to boost capital levels, it said on Wednesday after failing this year’s Bank of England stress test, which warned of a ‘challenging’ outlook for Britain’s financial system.
The state-backed lender rushed out a statement following the announcement to say it would take a range of actions, including selling off bad loans and cutting costs to make up the capital shortfall identified by the tests of around 2 billion pounds.
The unexpected result underlines the litany of problems RBS is grappling with, which include a mounting legal bill for misconduct ahead of the 2008 financial crisis and difficulties selling off assets such as its Williams & Glyn banking business.
The lender said it had agreed a plan of action with the Prudential Regulation Authority, the Bank of England’s enforcement arm, that should mean it does not have to tap markets to raise the money needed.’
From Reuters

This post was published at Gold Core on November 30, 2016.