Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.

Regulator Identifies £13.6bn Capital Shortfall at Royal Bank of Scotland

LONDON -- The shares of Royal Bank of Scotland  (LSE: RBS  ) (NYSE: RBS  )  slid 1 pence to 318 pence during early trade this morning after the Prudential Regulatory Authority said it had identified a £13.6 billion capital shortfall at the bank.

The PRA, which was established this year to regulate the bank sector and is part of the Bank of England, assessed eight major U.K. banks and building societies to ensure they held capital resources representing at least 7% of their risk-weighted assets by the end of 2013.

As at the end of 2012, the PRA calculated risk-weighted assets and capital resources at RBS were £624 billion and £30 billion respectively, giving a ratio of 4.8%.

The PRA acknowledged the bank's existing plans would produce extra capital of £10 billion this year, leaving a further £3 billion to be generated.

RBS said this morning that, based on its own projections, just an additional £0.4 billion was required over and above its 2013 capital plans. The FTSE 100 member claimed this £0.4 billion would be produced during early 2014.

Other organisations named by the PRA today as carrying a shortfall were BarclaysCo-operative Bank, Lloyds Banking Group, and Nationwide, with their combined deficit coming in at £27 billion.

HSBCStandard Chartered and the U.K. arm of Santander were all deemed to have met the PRA's 7% capital measure.

Of course, whether today's update from the PRA as well as the wider prospects for the banking sector still combine to make RBS shares a buy is something only you can decide.

However, if you currently own RBS shares and are looking for bargains outside of the banking sector, this special market research divulges five particularly attractive possibilities.

Indeed, all five opportunities offer a rich mix of robust prospects, illustrious histories and dependable dividends, and have just been declared by the Fool as "5 Blue Chips You Can Retire On"!

Just click here for your report -- it's free.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2501236, ~/Articles/ArticleHandler.aspx, 3/26/2015 3:15:30 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...