24th Jul 2015 13:49
LONDON (Alliance News) - Competition regulators have been asked to delay their assessment of what the divestment of Williams & Glyn by Royal Bank of Scotland Group PLC means for competition in the banking sector because the challenger bank's business plan is yet to be finalised, the UK Treasury said on Friday.
The Treasury, which is the UK government's economic and finance ministry, had previously asked the Competition and Markets Authority to assess the impact of the planned divestment. The findings, which were originally meant to be reported inside July, are meant to help both government and RBS to decide whether more can be done to help competition.
The Prudential Regulation Authority, part of the Bank of England, is due to assess the viability and sustainability of Williams & Glyn's business model as part of the regulator's steps to decide whether to authorise the lender. Since Williams & Glyn's business plan has not been finalised, the PRA has not been able to examine it, the government said.
"At this stage, Williams and Glyn's business plan has not yet been finalised and it is not possible for the Competition and Markets Authority to conclude its advice until the Prudential Regulation Authority has had the opportunity to examine this plan. We have therefore asked the CMA to delay finalising its advice until later in the year," the UK government said in a statement.
RBS was not immediately available for comment.
The European Commission, which is the European Union's executive body, requires RBS to divest Williams & Glyn by the end of 2017 as a condition of the aid given to the bank by the UK government during the financial crisis of 2007-09.
The UK government still owns about 80% of RBS after injecting it with GBP45 billion to prevent the bank from failing at the height of the financial crisis.
RBS shares were down 0.9% at 350.10 pence on Friday afternoon.
By Samuel Agini; [email protected]; @samuelagini
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