RBS share price: Scottish independence vote will delay government stake sale

on Sep 9, 2014
Updated: Apr 27, 2023

iNVEZZ.com, Tuesday, September 9: Analysts believe that a ‘yes’ vote in the upcoming Scottish independence referendum would impact the UK government’s timeframe for offloading its 81-percent stake in Royal Bank of Scotland Group Plc (LON:RBS), Bloomberg has reported.

RBS’ share price took a hit yesterday after a poll pointed to a lead for the ‘Yes’ campaign in Scotland for the first time this year. The FTSE 100 lender’s shares have recovered today though, up 0.36 percent to 343.74p as of 14:06 BST.
**‘Yes’ vote impact**
Bloomberg today quoted Simon Willis, an analyst at Daniel Stewart Securities Plc, as saying that a ‘yes’ vote would “undoubtedly have to defer the timeframe for the stake being placed until things become clearer about the future of Scotland and the shape and structure of RBS”.

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“Equally, it’s difficult to believe investors would be happy to take part in a further placing of Lloyds with their future being very uncertain,” he added.
RBS still is 81 percent owned by the UK government following its massive £45 billion bailout during the financial crisis. While the government has already cut its stake in bailed-out peer Lloyds Banking Group Plc (LON:LLOY) to 25 percent, it has been unable to offload its holding in RBS with the stock continuing to trade below the 407p level at which taxpayers will break even on their investment.

Shares in both Lloyds and RBS dropped yesterday after a YouGov Plc survey for The Sunday Times showed that nationalist leader Alex Salmond’s pro-independence ‘yes’ campaign had taken a two-point lead ahead of the referendum on Thursday of next week. () RBS’ share price is expected to drift further away from the break-even level if Scotland votes to break away from the UK.

“There’s a massive amount at stake,” Chris Wheeler, an analyst at Mediobanca SpA, told Bloomberg. The vote “now has got too close to call and the cost is going to be substantial. The shares are going to be down five to ten percent on September 19 if there’s a ‘yes’ vote.”

**RBS stance**
Bloomberg’s Businessweek yesterday reported that RBS spokeswoman Linda Harper had declined to comment on what contingency plans the lender had in place in the event of a ‘Yes’ vote.
In June, RBS Chairman Philip Hampton said that the bank continued to maintain a ‘neutral position’ on Scottish independence. ()
**As of 14:18 BST, buy RBS shares at 343.80p.**
**As of 14:18 BST, sell RBS shares at 343.50p.**


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