Britains banks are facing a rocky road
Britain’s banks are facing a rocky road as shares plummet again, with talks of the government possibly injecting billions of pounds of taxpayers' money into the sector.
Royal Bank of Scotland is currently at its lowest point since the recession of the early 1990s – with Barclays, Lloyds TSB and HBOS also hit.
Britain's bank bosses are now due to meet with Alistair Darling in order to discuss a possibly rescue bid and injection of equity.
The suggestion seems to be part-nationalisation consisting of capital invested into the banks through preference shares taking precedence over ordinary shares during a liquidation, but do not give the holders any voting rights.
It is evident that something needs to be done as RBS shares were 25% lower meaning a market capitalisation of £17.9bn – which is down from over £75bn a year ago.
HBOS was 14% lower and Lloyds TSB had lost 7%. Barclays had recovered most of its early losses.
(Tuesday, October 7, 2008)