Bank's forced sell-off will benefit no-one

Published on Wednesday 4 November 2009 20:05

With the latest revelations that RBS must sell off much of its family silver (your report, 4 November), I fear that the current obsession among the media and those in power to vilify and punish banks has gone too far.

The disastrous mistakes of some banks' senior executives are acknowledged by all, as is the sensible logic behind the government's painful decision to bail out RBS and Lloyds/HBOS at the taxpayer's expense. However, what is now proposed – particularly in the case of RBS – makes little or no economic sense for either the government or the taxpayer shareholder.

It is in the interests of all of us as taxpayers to see RBS and Lloyds recover financial strength as quickly as possible. The continued baying for blood by some MPs (of all parties) and the overzealous dictates of an unelected, intransigent and ideologically driven Eurocrat will only result in a prolongation of our pain.

Stronger competition is, of course, desirable, but I suspect the benefits brought about by the proposed exercise will be marginal at best. Furthermore, as shareholders in successful businesses such as Direct Line and Churchill, do we really want to see these being sold off at knockdown prices?

It should be borne in mind that the return of the billions of pounds' worth of support given by the government to Lloyds and RBS does not have to rely entirely on punitive fees, interest and debt payback. It can also be achieved by the steady increase in the value of its shareholdings. The restoration of the health of these banks could, over a period of time, bring strong surpluses into the national exchequer, as well as maintaining the jobs of a largely innocent workforce.

British banks compete on a world stage where others are not similarly handicapped and there is a need for those in power in the UK and Europe to take a wider and more pragmatic approach.

Sadly, as so often happens in British politics, once a bandwagon gets rolling, politicians and the media cannot get on it fast enough. The trouble is that very few have the nous to know when to get off.

RICHARD VASEY

Seaways

Aberlady, East Lothian

When I chose my bank, I did so deliberately and with care. I am more than satisfied with the support and service I have received from it during the past 20 years. Now the EU, with UK government connivance, is apparently telling it to sell my local branch (and, presumably, my accounts and savings along with it).

No doubt EU civil servants, the government and the bank will expect me to co-operate, but, unfortunately, I don't like being pushed around – so I'm afraid I won't. I have no intention of banking with an over extended greengrocer, a CD salesman or even an airline; for all their recent failings I prefer to bank with real banks.

DAVID FIDDIMORE

Calton Road

Edinburgh