Sunday, October 12, 2008

Government to Take Control of Royal Bank of Scotland on Monday

The Times of London is reporting that the British government will move to take control of the Royal Bank of Scotland on Monday morning by injecting £20 billion of taxpayers’ money.

The Government is also expected to take over HBOS in the most dramatic extension of state ownership in the British economy since the war. The bank’s rescue takeover by Lloyds TSB appeared to be on the brink of collapse [Sunday] night.

As governments around the world scramble to prevent the collapse of the global financial system, Alistair Darling will unveil plans for a £40 billion “recapitalisation” of the banking sector.

The announcement, expected to be made before the London Stock Exchange opens [Monday] morning, could involve the taxpayer taking big stakes in other banks including Lloyds TSB and Barclays, if investors do not answer the call to buy shares.

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