Chairman 'profoundly sorry' for RBS woes

Updated 18.12 Thu Nov 20 2008

Keywords: bailout, shareholders, rbs

The Royal Bank of Scotland's boss has said he is "profoundly sorry" for its financial crisis as a £20 billion bail-out plan was backed.

In Edinburgh, over 99 per cent of investors who voted backed a Government rescue plan, accounting for 59 per cent of the total shares in issue, the bank said.

The bail-out could leave the Government holding 43 per cent of the combined Lloyds/HBOS group and a 58 per cent stake in RBS

Chairman Tom McKillop said: "I, as the chairman of RBS Group, both personally and in the office I hold, am profoundly sorry about the position we have reached."

The rare apology from a top bank official came after RBS has swung from record profits of over £10 billion last year to a second request for funding this year, damaged by billions of pounds in losses on structured credit assets and a need to rebuild capital in the face of recession.

The Government is buying £5 billion of preference shares and looks set to take £15 billion of ordinary shares. RBS shares are down 88 per cent this year.

Shares in Lloyds and HBOS, the two other banks also receiving state funds, rose 5.7 percent and 12 percent respectively as the DJ Stoxx European bank index fell 2.9 percent.

The bail-out could leave the Government holding 43 per cent of the combined Lloyds/HBOS group and a 58 per cent stake in RBS.