Institutional investors yesterday paid less for the shares than the 502 pence shelled out by the government when it bailed the bank out following the financial crisis of 2008.
UK Government Investments, the government’s expert body on corporate finance, sold 925 million shares at 271p per share, compared to 502p per share when it invested in 2008, reflecting a loss of £2.1bn, according to Reuters.
Chancellor Phillip Hammond said: “This sale represents a significant step in returning RBS to full private ownership and putting the financial crisis behind us.
“The government should not be in the business of owning banks.
“The proceeds of this sale will go towards reducing our national debt- this is the right thing to do for taxpayers as we build an economy that is fit for the future.”
The government still owns 62% of RBS following the transaction.
Shadow chancellor John McDonnell said: “There is no economic justification for this sell-off of RBS shares.
“There should be no sales of RBS shares, full-stop. But because of this government’s obsession with privatisation, the taxpayers who bailed out the bank will now incur an enormous loss.
“Taxpayers are paying the price for the Tories’ mismanagement of RBS over the past eight years.”
The National Audit Office concluded in a report last year that the government’s first sale of RBS shares - 5.4% in August 2015 - was “well planned and organised” despite a failure to recoup the public funds invested into the bank.
