Citizens sale seems like a political smokescreen for RBS

From Boston Business Journal
By Matthew L. Brown
March 1, 2013

How many times since 2008 could the “RBS will sell Citizens” story have been written? Many. How many times has that sale actually happened?

The Royal Bank of Scotland’s announced intention to begin selling its Providence-based Citizens Financial Group via an initial public offering in about two years stretches the bounds of credulity.

Who says they’re going to sell in two years? The whole thing feels like a stall tactic, a way to get the British government to shut up for a little while, and to get RBS past the 2015 U.K. general election intact. Prime Minister David Cameron is preparing for what is expected to be a desperately close reelection bid, and would love to use an exit from the RBS situation as window dressing.

It also feels like an invitation for the M&A folks at the banks pegged as likely buyers – TD Bank, the National Bank of Canada, Wells Fargo, PNC and U.S. Bancorp – to pick up the phone and talk about a full acquisition.

They’re less likely to buy a non-controlling stake in Citizens as a passive investment, and hope that perhaps, maybe, if things work out, they can buy the remaining 75 percent sometime later, says Cornelius Hurley, director of Boston University’s Center for Finance, Law and Policy

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