London’s FTSE 100 up as major banks still fall

RBS shares fell as much as 39p at one stage today, as news broke that the Treasury was pushing to take an equity stake in banks for a significant recapitalization. Although Royal Bank of Scotland issued a statement saying “Contrary to press speculation, RBS did not make a request to government to capital.” Just before 1pm October 7.

Royal Bank of Scotland shares recovered from its 95p low on early trading and hit 111p down 25p once the statement had been announced.

Lloyds TSB was down 11.2p while Barclays were down 5p. Both banks have been reported to be seeking government capital. Alistair Darling was said to have met both of the major banks to discuss a Treasury plan allowing the government to take stakes in banks in return for capital.

Although chief executive on Barclays John Varley shunned the reports and said “Barclays has not requested capital from the government and has no reason to do so.” However Lloyds TSB declined to comment.

Read the full article: Telegraph