Any other business: The big debate after the Budget: how to turn taxpayers’ RBS shares back into cash

‘The faster the government starts selling its stake, the better for everyone,’ RBS chief Stephen Hester told the British Chambers of Commerce conference last week. In doing so, he opened up what may become the hottest financial debate after the Budget hoo-hah has died down: when and how should the government’s holding company, UK Financial Investments, start disposing of its 82 per cent stake in RBS and its 41 per cent stake in Lloyds? In the case of RBS, the government bought in at an average share price close to 50 pence against a market level of 29 pence today, and at least one more year of losses is expected before the bank begins to look relatively healthy again. Nevertheless, some analysts rate the shares a ‘buy’ — UBS says RBS is ‘a clear recovery play on the UK and US’ — so the price gap can be expected to narrow, but not quickly.