RBS 'planning to ask for up to £12 billion from shareholders'

18-04-2008

RBS 'planning to ask for up to £12 billion from shareholders'
Britain's second largest bank, the Royal Bank of Scotland, is preparing to ask its shareholders for billions of pounds in an attempt to improve its finances, reports today claim.

Sky News claims that the bank is aiming for a rights issue worth between £5 billions and £12 billion.

Reports claim the move is to help repair RBS's balance sheet which has been seriously damaged by bad debt and the continuing fall out from the global credit crunch.

According to a number of newspapers this morning, the bank will raise the funds by selling shares to existing investors.

RBS, owners of NatWest, Ulster Bank and Direct Line, has refused to comment on the rumours, claiming a trading update will be issued next week as scheduled.

"RBS notes recent speculation about a possible rights issue," a statement said.

"RBS confirms that its Interim Management Report covering trading performance and capital will be made next week."

Shares in the bank fell 2.4 per cent in late trading on Thursday as rumours of the move began to spread.

In February, RBS unveiled profits of £10.3 billion, despite heavy losses from the current economic crisis sparked by the credit crunch.

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