UKFI makes clear its intention to manage the stakes commercially as an engaged institutional shareholder at arm’s-length from Government. UKFI will not interfere in the day-to-day running of the banks, but will continue to engage strongly on strategic issues which could impact value including board membership, risk management and remuneration policy.
John Kingman, UKFI chief executive, said: “Every UK household will have more than £3,000 invested in shares in RBS and Lloyds. Today UKFI is setting out our strategy to deliver on the tasks we have been given: maximising the value of these investments for the taxpayer, and returning the banks as strengthened institutions to full private ownership over time.”
UKFI does not set any fixed timetable for disposing of the shares but says it expects to undertake a number of capital markets transactions over a sustained period. If UKFI sold the shares now it would make a loss of £10.9 billion, it said, although that loss would be less than the £18.1 billion shortfall registered in February.
Commenting on reports that UKFI has said it will be ‘challenging' to sell taxpayer stakes in nationalised banks back to the private sector, Liberal Democrat Shadow Chancellor, Vince Cable said: "Brown, Darling and Mandelson pretend that UKFI is there to make the banks lend while Lord Myners says that it's not a tool of public policy.
"UKFI tells us that it cannot interfere with the daily running of the banks but also believes it will be able to increase shareholder value. The two don't add up, especially when UKFI cannot even define how its own performance should be measured.
"This schizophrenic approach is deeply damaging and reflects the utter confusion at the heart of Government.
"If all the taxpayer liabilities are taken into account, the current loss against RBS and Lloyds looks closer to £20 billion than the £11 billion UKFI appears to be saying.
"There is no justification for an early sell off. UKFI should ensure that any Government attempt at a quick sale before an election is stopped in its tracks.
"Taxpayers bailed the banks out and in return, UKFI must start to act in the public interest and make it clear to the banks they own that they should operate in the same way."
