Is The Royal Bank of Scotland a strong buy, with an eye on privatisation around October 2013? I ask this not because of any quantitative analysis on my part, or even because I’ve been talking to industry analysts who cover the 84%-state-owned institution being propped by £45bn or so of taxpayers’ money. I ask it because I began musing out loud while doing a gentle jog this morning (May 31) to and from my own bank (the 41%-state-owned Lloyds TSB group) and a lot suddenly seems to make sense.
My thinking is that it is inconceivable that a Conservative-led Government will want to fight the next general election in the UK (due in early May 2014) while owning 84% of one of the country’s biggest banks. It will want to sell, and bank the political as well as the socio-economic benefits that it would hope to derive from a successful sale.