During the 2008 financial crisis, the UK Government took a significant stake in RBS to prevent the bank from collapsing. The UK public still owns an 84% stake. To avoid the contravention of state aid restrictions, the Commission required RBS to sell off 300 branches operating under the banner of Rainbow before the end of 2017. In the absence of buyers, RBS is proposing an alternative plan where the government provides what is public money to smaller private banks while continuing to own a significant stake in RBS. Transparency in the process is essential as this is an issue of public concern; UK citizens have a right to know how their money is spent.

Given that RBS is now worth less than when the government took its stake, does the Commission consider that this benefits primarily the public, the bank or HM Treasury?

State Aid rules are designed to prevent public intervention from distorting private markets. RBS’ failure to divest Rainbow/Williams & Glyn shows that private actors see no viability in that market. Does the Commission agree that using GBP 750 million of state-controlled money to stimulate that market constitutes a distortion?

What is the Commission’s view on the alternative proposal of investing GBP 750 million to increase the diversity of models in the UK banking sector, namely by allocating the money to regional, public or customer-owned banks?