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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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza