BoE Governor Favours Breaking up RBS

Bank of England governor Sir Mervyn King has said there is a case for splitting up Royal Bank of Scotland.

He told the Banking Standards Commission that there was a “good bank, bad bank” within bailed-out RBS.

Sir Mervyn said the arguments for restructuring RBS “sooner rather than later are powerful ones”.

He also warned that some banks were still “too big to fail” and said he was “surprised” at the degree of access bank executives had to top politicians.

On RBS, Sir Mervyn said: “The whole idea of a bank being 82%-owned by the taxpayer, run at arms’ length from the government, is a nonsense. It cannot make any sense.

“I think it would be much better to accept that it should have been a temporary period of ownership only, to restructure the bank and put it back. The longer this has gone on the more difficult that’s become” to return RBS to the market.

via BBC

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