RBS's Royal Screw-Up
God save the Queen, but we're not even sure the Old Girl can save the Royal Bank of Scotland
RBS accepted another round of government assistance Monday and announced that its losses for 2008 could approach 28 billion pounds ($41.3 billion), the largest ever for a British corporation. The bank's ADRs plunged 69% to just above $3 when trading in New York resumed Tuesday after the holiday weekend.
"Almost all their losses are in the subprime markets in America and related to the acquisition of the bank ABN Amro," said an angry Prime Minister Gordon Brown at a news conference. "And these are irresponsible risks, which were taken by a bank with people's money in the United Kingdom."
In an interview with British newspaper The Times, recently appointed RBS Chief Executive Stephen Hester pledged "to return banking to boredom and not use colorful adjectives at a time when there are lots of emotions running high."