Government pockets £150m in RBS’s first dividend since bailout
THE GOVERNMENT has pocketed £150m as Royal Bank of Scotland paid the first dividend since its £45bn bailout a decade ago.
The bank yesterday paid out a total of £240m to around 190,000 ordinary shareholders including UK Government Investments, which manages the Government’s 62 per cent stake in the lender.
RBS announced the 2p per share interim dividend in August after reaching a 4.9bn US dollar (£3.7bn) settlement with US authorities over claims that it missold mortgages in the run-up to the financial crisis.
The shareholder payout comes almost 10 years to the day since the bank received the first tranche of a Government rescue package at the height of the banking crash on October 13 2008.
Chief executive Ross McEwan said: “I’m pleased to be able to pay a dividend to our shareholders; a small return after their many years of patience and a testament to the hard work of everyone at this bank.
“This is another important milestone in our turnaround, almost 10 years to the day that RBS was rescued by the British taxpayer.
“We have created a smaller, safer bank that is generating more sustainable profits.
“Our capital position is above our target and we are also looking to return any excess capital as soon as possible to shareholders.”
But while the dividend was welcomed by the Treasury, the Government is unlikely to ever recoup the cash it stumped up for RBS during the bailout.
The Government earlier this year sold a 7.7 per cent stake in RBS at a £2.1bn loss to the UK taxpayer. The sale of around 925m shares brought the public holding in RBS down from 70.1 per cent to 62.4 per cent.
He said the dividend was an important milestone for the company.