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RBS to exit UK insurance scheme

Wednesday, October 17 09:40:27

Part-nationalised Royal Bank of Scotland today said it is to exit the UK state-backed insurance scheme covering its poorer-quality assets. The significant move was hailed by Chancellor George Osborne as another step towards returning the 80pc state-owned lender to the private sector. RBS will save £1.4 million a day when it exits the Asset Protection Scheme (APS) tomorrow, having paid £2.5 billion since signing up February 2009.

The Chancellor said: "The Government's strategy remains to return RBS to the private sector when it is value for the taxpayer to do so. Today is a step in that direction." The APS, from which RBS never had to make a claim, provided backstop credit insurance for a portfolio of RBS assets and derivative exposures. It played an important role in stabilising market perceptions of RBS after the impact of the financial crisis became clearer and the bank's share price fell to a low of 10p in February