RBS said it is shutting its ‘bad bank’ which it set up to take care of the toxic assets created during the financial crisis. The bank said in an internal memo that it is finally shutting the ‘non-core’ bank, after the division racked up more than 50 billion pounds of cumulative losses. The bad bank had existed in several forms since 2008 and once employed more than 19,000 people – or 1 in 10 of RBS staff at the time. When it is finally closing, it will have just 80 employees, the bank said some of these may be transferred to the core bank. RBS is 71% owned by the taxpayer following its financial crisis bailout. The Treasury has already framed a plan to begin selling that stake within 18 months, which could lead to the realization of a 26.2-billion-pound loss. The bad bank’s remaining 23.1 billion pound of assets will be folded back into the core bank, largely into investment banking arm NatWest Markets.
