Font Size

- Aa +

Sun 5 Jun 2011 03:02 PM

Font Size

- Aa +

RBS courts Gulf funds before government sale

Britain poised to sell stake in indebted lender, Qatar wealth fund has expressed interest

RBS courts Gulf funds before government sale
The UK government accumulated stakes of 83 percent in RBS during the financial crisis

Royal Bank of Scotland Group’s chief executive officer Stephen
Hester is looking to attract sovereign wealth funds in the Middle East ahead of
the government’s sale of the UK bank, it was reported Sunday.

Hester met with investment funds in Abu Dhabi, Dubai, Qatar
and Kuwait during a tour of the Gulf last week, the Sunday Times reported.

The bank’s CEO wants the government to sell a part of its
shareholding worth between £5bn ($8.2bn) and £10bn early next year, the paper
said, citing people close to the lender it didn’t identify.

Hester said during his visit to Abu Dhabi that he would be
disappointed if the sale of the government stake didn’t start in 2012.

The UK government accumulated stakes of 83 percent in RBS
and around 40 percent in Lloyds Banking Group after bailing out both banks with
billions of pounds of taxpayers' money during the credit crisis.

The government
wants to sell back those stakes to the private sector in a bid to raise cash to
cut Britain's deficit, but a final decision on the sale rests with UK Financial
Investments, a specially-formed body that oversees taxpayer investments in the
lenders.

Qatar’s Prime Minister said in February the Gulf state was
open to taking stakes in RBS and fellow state-owned bank Lloyds.

For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.