British Lawmakers Call for Review of Split RBS, LloydsGavin Finch
U.K. lawmakers have recommended the Treasury conduct a review into the advantages and disadvantages of splitting up state-owned Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc.
“Such an analysis should include an examination of the fiscal and competition implications, and be completed by the time of the announcement of the government’s spending review in June,” the Treasury Select Committee in London led by Andrew Tyrie said in an April 20 report published on its website.
The request comes a month after Bank of England Governor Mervyn King urged the government to split RBS, Britain’s largest publicly owned lender, into a so-called good bank that could fund itself and a bad bank, where unprofitable assets would be transferred. Chancellor of the Exchequer George Osborne has called such a move impractical and disruptive.
“If we had thought that breaking up RBS was a practical proposition, we would have done it,” Osborne said in December. “Do you go back in, disrupt everything and try and rip out of RBS the bad assets? Try and value them? That would take a long time in order to achieve something in the future.”
RBS and Lloyds were both bailed out by the U.K. taxpayer during the global financial crisis.