Merrill Lynch Expects RBS To Earn Taxpayers £6 Billion on 100 Mortgages

Royal Bank of Scotland (RBS) bailout by the Government could make the UK taxpayer £6 billion or more according to investment bank Merrill Lynch.

Merrill Lynch put a target price of 93p on the RBS shares value, this comes after Citigroup last week put the target price at 100p a share.

The government which last week became a 58 percent share holder in Royal Bank of Scotland is sitting on a paper loss of £2.6 billion after existing share holders declined on the deal to purchase the shares at 65.5p.

If the target price that Merrill Lynch has set is reached it would give the government (the UK taxpayer) a £6.3 billion lead.

Merrill Lynch said that new Chief Executive Stephen Hester has at least 5 options for his new strategy, such as selling a stake in Bank of China or maybe sell US business Citizens and run down the RBS (or former ABN Amro) investment balance sheet.

Source: thisismoney

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