Royal Bank of Scotland Group plc (ADR) (RBS): The Bank That Was a Political Football Is Even More So Now

The other (partially) state-owned bank

While RBS has been attracting a lot of financial press lately due to the large government stake in the bank, Lloyds Banking Group PLC (ADR) (NYSE:LYG) is also partially owned by the U.K. government. But with a stake of less than 40 percent, Lloyds Banking Group PLC (ADR) (NYSE:LYG) investors feel a lot less threatened. This largely explains why in June where RBS shares fell, Lloyds shares were relatively flat. For Lloyds, more investors see a light at the end of the tunnel thereby eliminating some of the uncertainty about Lloyds Banking Group PLC (ADR) (NYSE:LYG) future.

Remnants of the crisis

While shares of the biggest banks this side of the Atlantic have been resold into private markets, RBS is still majority owned by the U.K. government. With elections fast approaching, politicians are trying to come up with a solution to the RBS problem. Since many politicians have proposed many different solutions, Royal Bank of Scotland Group plc (ADR) (NYSE:RBS)’ future rests on which proposal wins out in the end. With this in mind, RBS investors need to watch more than bank fundamentals; they also need to watch a political debate.

The article The Bank That Was a Political Football Is Even More So Now originally appeared on Fool.com and is written by Alexander MacLennan.

Alexander MacLennan has no position in any stocks mentioned. This article is not an endorsement to buy or sell any security and does not constitute professional investment advice. Always do your own due diligence before buying or selling any security. The Motley Fool has no position in any of the stocks mentioned. Alexander is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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