Capital issues ‘must be tackled’ before RBS share sale

<p>The RBS share sale cannot take place until capital issues are resolved.</p>

A number of capital issues will need to be resolved before the government's planned share sale of the part-nationalised (Royal Bank of Scotland) RBS can go ahead.

This is the view of James Leigh-Pemberton, who is due to become executive chairman of UK Financial Investments from January next year.

He explained concerns over the future strategy of the firm will have to be addressed before the share sale can move forward.

Speaking to the Treasury Select Committee, Mr Leigh-Pemberton said: "There are certain issues in relation to RBS which absolutely have to be tackled as a precursor to successful reprivatisation: sufficient capital; strategic focus on businesses where they enjoy competitive advantage and higher returns and the normalisation of the capital structure."

His comments come shortly after RBS revealed it is creating an internal 'bad bank' where £38 billion of assets will be stored.

The share price of RBS dropped today (November 12th), falling by 2.62 per cent by 13:30 GMT.

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