The Royal Bank of Scotland is on the verge of making a symbolic departure from an 'essentially worthless' government insurance scheme, The Times has said.
The newspaper reported on Thursday that the Treasury agency that runs the scheme, the Asset Protection Agency, has informed staff they will soon no longer have a job and should prepare to be made redundant or relocated.
Sources have revealed that RBS, which has previously told its investors it wants to be free from the agency by the year-end, is now planning its exit for around mid-October.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
As of that time, the scheme will have received £2.5bn in premiums from the company, the amount it agreed to pay in return for protection when first joining the scheme three years ago.
Stephen Hester, the Chief Executive of RBS who recently described the scheme as "essentially worthless", previously told The Times that, "there is a very big cushion before the insurance kicks in in terms of the first-loss provision, and neither we nor the asset protection industry can conjure up the scenario where that cushion is exhausted".
Departure from the scheme will require the approval of both the Treasury and the Financial Services Authority, both of which are expected to give their consent.
NR
-
FTSE 100 hits record highs – why is it rising and will we see more gains?Advice UK equities have been described as unloved for a long time but as the FTSE 100 hits new highs, we explain if now is the time to buy British.
-
How to invest in copperIt may be time to invest in copper as the red metal appears poised for a big jump. Dominic Frisby looks at what should investors should buy
