Investment analysts split on impact of RBS sell-down

Government reducing stake from 70.1% to 62.4%

Investment analysts are divided on whether the first tranche of the Royal Bank of Scotland (RBS) sell-down will prove beneficial for investors, although the consensus is it is a good move for the government.

Earlier this week UK Government Investments (UKGI) announced the sale of 7.7% of RBS to institutional investors, which will reduce the government's stake from 70.1% to 62.4%. At £2.71 each, shares were sold at almost half the £5.02 per share paid by the government as part of the £45.5bn bailout at the height of the financial crisis, resulting in a loss of £2.1bn. Old Mutual Global Investors' Rob James, financials analyst and manager of the Old Mutual Financials Contingent Capital fund, said the bank is battling with shareholder returns and has reached fair value. "From an investmen...