So, now we know. The guessing game is over and Royal Bank of Scotland (RBS) has been hit with a fine of £400m for its role in the LIBOR-rate rigging scandal.

It may sound a lot but don’t be kidded, don’t be conned. RBS is, after all, a firm with annual revenue of around £30bn. To put the size of the fine in context, it has already set aside £1.7bn (and rising) to cover the cost of claims for mis-sold payment protection insurance (PPI).

What is another £400m between friends for a bank bailed out to the tune of £45bn?

Taxpayers currently have the dubious distinction of holding around 81 per cent of shares in RBS with the government having paid the equivalent of just over £5 per share.

With a current share price of £3.40, the government is sitting on paper losses of just under £15bn.

As Vince Cable has gloomily but accurately forecast, early hope for RBS being re-privatised is no more than a “distant dream.”

There is however one thing that the UK government could do and do quickly. It could stop pussyfooting about over RBS’ US-based subsidiary, Citizens Bank.

Citizens, headquartered in Rhode Island, operates in 12 US states; it is a top 20 US bank with assets of $132bn, around 1,400 branches and a staff of 19,000 employees.

To date, RBS has resisted calls to sell Citizens, despite interest shown in its US unit from a number of banks.

Canada-based Toronto-Dominion and Brazil’s Itau-Unibanco have, from time to time, been linked with an interest in snapping up Citizens. US-based PNC is another potential bidder.

Analysts forecast that if Citizens was on the block, it might fetch around £7.5bn. The party line from RBS has, to date, taken the line that Citizens is a core asset and not for sale. Poppycock.

RBS will, eventually, have to bow to the inevitable and cash in its Citizens chips. It is now time for the government, via UK Financial Investments Limited, the organisation set up immediately after the October 2008 bailouts of Lloyds and RBS, to bear its teeth.

It could start by leaning heavily on RBS to focus on getting its domestic market in order and sell off Citizens.