RBS brokers deal to sell off £3.8bn of assets to Japanese

Royal Bank of Scotland's disposal programme continued yesterday as the group struck a deal with Japan's biggest bank to sell £3.8 billion of "non-core" project finance assets.

The Bank of Tokyo-Mitsubishi UFJ Financial Group (MUFG) has signed a memorandum of understanding with RBS to buy the portfolio of mainly global power, oil and gas and infrastructure assets in the UK, mainland Europe, the Middle East and Asia-Pacific.

The proposed sale masterminded by RBS chief executive Stephen Hester, which is subject to regulatory approvals and the signing of a legally binding agreement, brings to about 20bn of assets sold off as non-core so far.

The UK infrastructure assets being sold comprise a string of project finance infrastructure (PFI) and public private partnerships (PPP) deals.

RBS stressed that UK energy and infrastructure remained a core activity for the bank. A spokesman said: "Our UK corporate banking division continues to be a leading provider of funding and advisory services to the UK infrastructure and energy sectors."

Other RBS non-core disposals since January 2009 include its stake in Bank of China; the Linea Directa insurance operation in Spain; its retail and commercial business in Taiwan, Hong Kong, Singapore and Indonesia; investment banking businesses in the Philippines, Vietnam, and Taiwan; RBS asset management; its Sempra metals, oil and European energy arm; invoice finance in France and Germany; and 311 RBS branches in the UK to Santander of Spain.

• Lloyds Banking Group yesterday denied reports that it planned to sell off its LDC private equity arm.