Given his, ahem, prescience on these matters, it’s worth flagging up Robert Peston’s latest blog post. He suggests that the Government’s next set of measures to prop up the ailing banking industry, expected Monday, won’t involve the establishment of a state-run “bad bank,” as had been mooted. Instead we can expect the “mother of all bank insurance schemes”:
“I don’t know why the Government hasn’t knocked on the head the idea that it’s working on the creation of a bad or toxic bank that would buy our biggest banks’ dodgy loans and investments.
What I expect it to announce on Monday (although the timetable could slip a day or so) is the creation of the mother-of-all bank insurance schemes.” With the amount of taxpayers’ cash that’s already been expended on the problem, one shudders to think of what £billion figure will be attached to this latest scheme. So far as taxpayer liabilities go, it’s also worth pointing out Peston’s claim that the Treasury’s considering a plan which would see “the state’s holding in [the] Royal Bank [of Scotland] rising from 57.9
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