Fund managers 'preparing RBS offer'

A group of more than 20 fund managers are preparing to table a takeover offer for 315 Royal Bank of Scotland (RBS) branches as suitors line up ahead of this week's bid deadline, it was reported.

The consortium, which is being led by Tesco's former finance chief Andrew Higginson, is thought to be the front-runner to secure the RBS branches being put up for sale to appease European Commission rules on state aid.%VIRTUAL-SkimlinksPromo%
Mr Higginson is said to have secured the backing of some of the UK's biggest blue-chip institutions for the approach, including Schroders, Invesco Perpetual, Henderson and F&C.

If successful, Mr Higginson - who also ran Tesco's banking operations - is expected to become chairman of the new bank, with plans to hold the branch network in a listed vehicle funded by the investors.

Other bidders also understood to be in the race ahead of Thursday's deadline for formal offers include Corsair Capital, which is working with US private equity firm Centrebridge Capital, and a rival private equity team comprising JC Flowers and Apollo.

But RBS, which must sell the branches following its £45.5 billion bailout at the height of the financial crisis, admitted on announcing annual results last month that it was not confident a sale would be successful.

It is also working on contingency plans for a flotation while also considering selling a minority stake to private equity and institutional investors to kick-start the process.

A previous deal to sell the branches to Santander collapsed as it was reportedly hit by delays and technology problems.

RBS has hived off the branches into a separate arm under the Williams & Glyn's brand and is offering it as a business with around £20 billion of deposits and loans, 1.7 million retail customers and 240,000 small-business clients.

10 things we hate about our banks
See Gallery
Fund managers 'preparing RBS offer'

More than 46,000 of 106,000 the complaints received by the FOS in the second half of last year related to payment protection insurance (PPI). And the organisation is expecting to receive a record 165,000 PPI complaints in 2012/2013.

The huge numbers are due to the PPI mis-selling scandal that should now be a thing of the past, but there is no doubt that the insurance, which can add thousands to the cost of a loan, is highly unpopular!

(Pictured: Martin Lewis after the PPI payout ruling)

Complaints about mortgages jumped by 38% in the last six months of last year, the FOS figures show, compared to an increase of just 5% in investment-related complaints.

Common gripes about mortgages include the exit penalties imposed should you want to sell up or change you mortgage before a fixed or discounted deal comes to an end, and the high arrangement fees charged by many lenders.

While there is nothing in the data released by the FOS about the number of complaints relating to savings accounts, hard-pressed savers have been struggling with low interest rates for several years now.

You can get up to 3.10% with Santander's easy-access eSaver account, but many older accounts are paying 1.00% or less and even this market-leading offer includes a 12-month bonus of 2.60% - meaning that the rate will plummet to just 0.50% after the first year.

Banks are imposing the highest authorised overdraft interest rates since records began, with today's borrowers paying an average of 19.47%, according to the Bank of England.

A typical Briton with an overdraft of £1,000 is therefore forking out around £200 in interest charges alone. Coupled with meagre returns on savings, it's enough to make your blood boil!

While authorised overdrafts may seem expensive, going into the red without permission will cost you even more due to huge penalty fees.

Barclays, for example, charges £8 (up to a maximum of £40 a day) each time that there is not enough money in your account to cover a payment.

If you need to send money abroad, the likelihood is that your bank will impose transfer charges - and offer you a poor rate of exchange. Someone transferring a five-figure sum could easily lose out by £500 or more as a result.

The good news, however, is that you can often get a better deal by using a currency specialist such as Moneycorp.

Automated telephone banking systems, not to mention call centres in far-flung parts of the world, are one of our top gripes - especially as we often encounter them when we are already calling to report a problem.

In the words of one disgruntled customer: "What is it about telephone banking that turns me into Victor Meldrew? Well, maybe it's the fourteen security questions, maybe it's the range of products that they try to push or maybe it's because I'm forced to listen to jazz funk at full volume while my phone bill soars.

"Actually though, I think it's because the people I eventually speak to rarely seem able to solve the issue I'm calling about."

The days of a personal relationship with your bank manager are long gone - for the huge majority of us at least.

When ethical Triodos Bank investigated recently why around 9 million Britons would not recommend their banks to a friend or relative, it found that almost a third felt they were not treated as individuals. Another 40%, meanwhile, were simply disappointed with the customer service they received.

When you're in a rush, the last thing you want to do is wait in a long queue at your local branch.

Researchers at consumer champion Which? recently found that most people get seen within 12 minutes, but you could have a much longer wait if you go in at a busy time. Frustrating stuff!

The Triodos Bank research also indicated that the bonus culture that ensured the bank's high-flying employees received large salaries, even when it was making a loss at the taxpayer's expense, was hugely unpopular with consumers.

About a quarter of those who would not recommend their current banks said this was the main reason why. And with RBS executives sharing a £785 million bonus pool despite the bank, which is 82% publicly owned, making a loss of £2 billion last year, it's not hard to see why.

More stories

Read Full Story