U.K. Hires JPMorgan to Provide Bank-Privatization Advice

Photographer: Simon Dawson/Bloomberg

The government owns 81 percent of RBS. Close

The government owns 81 percent of RBS.

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Photographer: Simon Dawson/Bloomberg

The government owns 81 percent of RBS.

The U.K. hired JPMorgan Chase & Co. (JPM), whose senior advisers include former Prime Minister Tony Blair, as it accelerates efforts to reduce its stakes in Lloyds Banking Group Plc (LLOY) and Royal Bank of Scotland Group Plc.

“JPMorgan Cazenove will provide ad hoc input which will complement UKFI’s expertise in devising strategies for realizing value for the government’s shareholdings in the banks,” U.K. Financial Investments Ltd., the body that oversees the government’s stakes in the lenders, said in a statement today. “This appointment does not involve any commitment in relation to other roles at any other time and UKFI intends to review this appointment on a periodic basis.”

UKFI also named a panel of 11 banks including Barclays Plc (BARC) and Goldman Sachs Group Inc. eligible to be selected as bookrunners in future stock offerings.

Chancellor of the Exchequer George Osborne said last month the U.K. government is “actively considering” selling shares in Lloyds. RBS’s return to private ownership is still some way off because it’s weighed down by too many poor assets, he told financiers in his Mansion House speech in London on June 19.

Lloyds shares exceed the level at which the government says it will break even on its 39 percent holding after providing a 20 billion-pound ($30 billion) rescue almost five years ago. The stock was down 1 percent at 69.34 pence by 11:26 a.m. in London, surpassing the 61 pence break-even price.

Osborne said last month the first block of government shares in Lloyds will probably be sold to institutional investors as “the most effective way of managing risk and getting value.” The government will consider an offering to individual investors at a later stage, he said.

RBS is trading at 336.8 pence, below the 407 pence the Treasury says it will break even on its 45.5 billion-pound investment in the 81 percent government-owned lender.

Following is a list of prequalified service providers:

Bookrunner Panel:
Bank of America Merrill Lynch, Barclays, Citigroup, Credit
Suisse, Deutsche Bank, Goldman Sachs, HSBC, JPMorgan, Morgan
Stanley, Nomura, UBS

Co-lead Panel:
ABN Amro, Banca IMI, BBVA, BNP Paribas, Canaccord Genuity,
Cenkos, Credit Suisse, HSBC, ING, Investec, Jefferies, KBW,
Macquarie, Nomura, Numis, Oriel Securities, Peel Hunt, RBC,
Sanford Bernstein, Santander, Societe Generale, UBS

Capital Markets Adviser Panel:
Lazard, Moelis & Co., Portman Capital, Rothschild, Solid
Solutions, STJ Advisors

Strategic Adviser, Privatization Strategy Adviser Panel:
BofA Merrill Lynch, Barclays, BNP Paribas, Citigroup, Credit
Suisse, Deutsche Bank, Goldman Sachs, HSBC, JPMorgan, Lazard,
Moelis & Co., Morgan Stanley, Nomura, Perella Weinberg, RBC,
Rothschild, Societe Generale, UBS.

Source: UKFI

To contact the reporters on this story: Gavin Finch in London at gfinch@bloomberg.net; Howard Mustoe in London at hmustoe@bloomberg.net

To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net

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