RBS: Ignore the APS-exit spin, and focus on the bank’s real position:

RBS is morally and financially bankrupt

So well is the RBS system of defrauding, scamming, overcharging and otherwise fleecing its customer base going, it will soon be able to leave the Government’s Asset Protection Scheme (APS) reports yesterday were suggesting.

The APS was (and is) a bit like insurance cover, the only difference being that whereas you and I insure the house knowing it almost certainly won’t burn down, we insured Chateau RBS when it looked likely to vapourise at any minute. But now Stephen Hester says things are so tickerty-boo, he doesn’t need the insurance any more.

The net effect will be to reduce Britain’s National Liabilities bill by some £114bn, or roughly 2.7% of the total. But my own feeling is that the main reason The Hester Pest has done this is to see if he can placate the EU by showing that he is now not really receiving any taxpayer aid…except of course for the 500p per share we paid for the privilege of buying four-fifths of RBS three years ago. This would mean he could stop worrying about the decision by Santander not to buy the bank’s 316 branches in the UK, because the Sprouts would no longer insist on selling it to some other mug. We shall see.

Either way, most of the press coverage missed a vital point: the APS was only ‘insuring’ a proportion of RBS toxicity…that based in the UK. As we’ve already seen at The Slog, Hester’s Hobgoblins have been busy helpfully hitting SME and individual UK debtor customers over the head with mallets in order to either fire them or bring them into line. Needless to say, they cannot follow such Mafioso policies abroad…where a further £170bn of radioactive toxicity is busy humming away quietly.

We need to keep an eye on the relative size of some of the numbers involved here – and ignore the spin-puffery bollocks put out by the RBS management team along with their partners in crime, The Treasury. For example, RBS looks likely to sell its ‘Citizens’ sub-brand in the US – for around £6bn, and the share price yesterday rose 4.4% on news of the APS exit…upping the valuation by a further £1bn. This sounds good when set against a market capitalisation of £31.3bn, but miniscule in comparison to £170bn of awfully dodgy debt, some of which involves Russian property which exists only in the minds of the borrowers.

Equally, yet again there were Treasury noises off yesterday about a ‘taxpayer profit’ following RBS’s APS exit, but this is complete twaddle. In the first place, we won’t see any of it given a national debt over £2.3 trillion; and in the second, the RBS share price closed at 280p yesterday…which still leaves all of us 220p per share in the red.

The Rogered Bowel Syndrome is exposed to around £75bn of eurozone debt. The requirement now (for those of us who can tell sh*t from putty) is to focus on both that debt in particular – and some of the fantasy assumptions made by the book-keepers at the ‘bank’. RBS and the government need to level with people about the real nature of the balance sheet.

For instance, European sovereign bonds in there bear no relation at all to real market value.

Loans backed by UK property should be written down by as much as 30%. The description in the accounts of RBS’s property value is complete tosh – even though the bank is busy stealing such assets by deliberately undervaluing them.

And as for the debt taken out in ClubMed….well, stop treating it as an asset. It is an asset in pretty much the same way as a rusty car with knackered steering and three slow punctures is an asset.

Stephen Huckster talks a good game, and gets paid handsome golden hellos. But neither he nor anyone else can change the fact that, in the real world, RBS is insolvent. Don’t be surprised to see Vince Cable buying the remaining 18% at some point during 2013.

23 thoughts on “RBS: Ignore the APS-exit spin, and focus on the bank’s real position:

  1. Pingback: John Ward – Ignore The APS-Exit Spin, And Focus On The Bank’s Real Position: RBS Is Morally And Financially Bankrupt – 17 October 2012 | Lucas 2012 Infos

  2. Nice bollox deconstruction , thanks JW. I’m so glad you understand
    and see clearly the true situation, even though its depressing, reading the truth is still reassuring.


  3. I banked at Williams and Glyns, mainly because my parents banked with its former incarnation, Williams Deacons (I think).
    The people were helpful and friendly – I once even asked my bank manager which of two job offers he thought I should take – there were hardly any queues, and the products excellent.
    Then they were taken over by RBS. These very same people became automatons, the queues got much longer and then the manager disappeared, now unnecessary because all decisions were made at area level.
    I’m astonished that anyone still banks with RBS.


  4. The whole idea that the bank had to be bailed out or customers would lose money is boll*cks. they were leveraged approx 40-1, so they owed 1 pound for every 40 pounds owed to them. The should have been wound down, every one with a mortgage say you owed 40k it would be writen off with a payment of 1/40th pay 1K and your mortgage is written off, the 1 k is given to the depositors , who would lose out?


  5. The banks should not have been “rescued” by bloody Brown. What was called for was prompt nationalisation and a rapid split into good bank/bad bank pairings. The losses would fall on the shareholders and then the bondholders, not on the taxpayers. Many of us taxpayers would lose by virtue of our pension funds, but so be it.


  6. It is the investors who would have paid the price (and they are overwhelmingly part of the so called elite 1%) they do not want to accept these losses instead foisting them onto the majority of the population


  7. Agree but remember these were banks who bases were in Scotland (HBOS and RBS) and Northern England (NR) if Labour had done this it would have shattered their support in these areas. Never mind waht is good for the country this was pure politics and we are all paying for this mess and will do for years


  8. Firstly i agree that the Banks should have been allowed to fold. Agreed that the elites and bondholders would have taken the hit, [this in turn would have screwed most our pension providers. BUT
    Why was it all G Browns fault? Most Banks have been bailed out around the world by the taxpayers. Plus i seem to remember the loans to the Banks where originally in the form of preferance shares [a loan] for which % was to have been paid along with the original loan?
    This is i believe what the ECB is now doing.

    What i cannot remember is who changed the preferance shares for ordinary shares and who benefited?


  9. investors who invest in equities earn a higher return to compensate them for higher risk, they should have been burned to a crisp. Government intervention destroys free market capital allocation efficiency


  10. Iceland told the bankster to go jump off a cliff, Iceland economy doing very well, wonder why its not mentioned in the media very much??


  11. It was properly described a few years back as “privatising the profit and socialising the loss” a complete abnegation of true capitalism. The banksters have captured regulators, politicians and treasuries across the world. They and their collaborative cohorts should all be before a Nuremberg Tribunal for Economic War Crimes, ahead of facing as firing squad.


  12. I have got to admit the RBS have become the largest asset stripper in this land of ours, the other big 4 not far behind.
    In short they sold a property I bought in 2007 for £630K in 2011 for £250K, ok I fought battled and eventually provided enough information for the police to ask them to press charges against certain proffessionals, the RBS refused.
    These comments are not fiction nor conspirecy theories, but fact, I have the documentation to show any sane person the truth, but the truth is the last line of defence the indefencable have to cover and they still (RBS) have a £200 million legal budget for this year to cover the fights of the corrupt, incapable, uneducated, fraudulently motivated bankers, still out there.
    The % of these bankers will only be 1% of all employees within the banks, but these people are on the top level of all the boards, some even call themselves ‘SIR’, Goodwin was stripped and these people will not do the same, nor now they have learnt by his mistake, this being arrogance, they will avoid the same bear trap.


  13. Last tuesdays Keiser report (2nd half) has an ex met copper explaining how the banking community are protected by Government from prosecution and have been for decades.

    Worth a watch if you can hack Max’s wobblies !


  14. Didn’t RBS recently roll 10 shares in to one ?

    So the shares purchased at 500p are, in reality, now only worth 28p not 280p

    Thats a loss of 472p per share not 220p ?

    Have I missed something ?


  15. No, they weren’t. They were bought at £5, then devalued 10/1 by RBS – so the loss IS £4.72 per share. Funny how the media haven’t noticed that, eh?


  16. Pingback: Revealed – the objective truth about London 2012: | A diary of deception and distortion

  17. The UK government purchased its stake at 50p per share. RBS later did a ten-for-one swap, partly in the hope of masking its failure. So, for the government to exit at a profit, it needs to sell its 83% stake at more than £5 (500p) a share. The shares are currently trading at about £2.80. (=28p before the ten-for-one swap.)


  18. Pingback: THOSE RBS RESULTS: fraud on an industrial scale, toxic mortgages, jiggery-pokery in Ulster…and bonuses all round. | The Slog.

  19. Pingback: John Ward – Those RBS Results: Fraud On An Industrial Scale, Toxic Mortgages, Jiggery-Pokery In Ulster…And Bonusses All Round – 31 January 2014 | Lucas 2012 Infos

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