RBS is in the doghouse again

Needs to hold £13.6bn cash.

RBS is in the doghouse yet again after the Prudential Regulation Authority (PRA), the Bank of England’s new banking regulator, announced that despite their best efforts five of the biggest UK banks will need to find an additional £13bn capital to cover their risks.  

To put it in perspective, that's twice the amount the PRA said RBS would have to come up when it released its report at the end of 2012. Back then the PRA named RBS as the worst offender in a list of top banks and building societies needing to fill a £27bn hole in their balance sheets. Yep, you heard that right. Banks are being told that should both be lending out more money to get the economy moving while at the same time being told they need to shore up their cash reserves in case everything goes to hell again. And in a timely manner, the Conservatives have an election to win soon.

Just to make RBS look even worse this news came in hot on the heels of George Osborne’s self-satisfied announcement that 39 per cent tax-payer owned Lloyds is ready for full re-privatisation while RBS may need to be split into a "good" and "bad" bank before it can be sold off. I’ll leave it to you to figure out which part the tax payer will be left with.

RBS alone accounts for £13.6bn of the total outstanding cash that banks need to hold. Making up the remainder are Lloyds Banking Group, Barclays, Co-operative Bank and Nationwide Building Society.

All of the banks, the PRA admits, have put good plans in to collect together the required capital but the regulator is coming to wildly different conclusions about how much the banks will actually save. According to the PRA actions planned by RBS in 2013 would reduce this gap to £3.2bn. However, RBS has said by its own estimate the shortfall was scheduled to be £400m by the end of the year.

Doesn’t a calculation difference of £2.8bn from two government controlled operations just fill you with confidence?

Photograph: Getty Images

Billy Bambrough writes for Retail Banker International at VRL financial news.
 

Photo: Getty
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It's not WhatsApp that was at fault in the Westminster attacks. It's our prisons

Britain's criminal justice system neither deterred nor rehabilitated Khalid Masood, and may even have facilitated his radicalisation. 

The dust has settled, the evidence has been collected and the government has decided who is to blame for the attack on Westminster. That’s right, its WhatsApp and their end-to-end encryption of messages. Amber Rudd, the Home Secretary, wants tech companies to install a backdoor into messages like these that the government can then access.

There are a couple of problems here, not least that Adrian Russell aka Khalid Masood was known to the security services but considered to be low-risk. Even if the government had had the ability to gain entry to his WhatsApp, they wouldn’t have used it. Then there’s the fact that end-to-end encryption doesn’t just protect criminals and terrorists – it protects users from criminals and terrorists. Any backdoor will be vulnerable to attack, not only from our own government and foreign powers, but by non-state actors including fraudsters, and other terrorists.

(I’m parking, also, the question of whether these are powers that should be handed to any government in perpetuity, particularly one in a country like Britain’s, where near-unchecked power is handed to the executive as long as it has a parliamentary majority.)

But the biggest problem is that there is an obvious area where government policy failed in the case of Masood: Britain’s prisons system.

Masood acted alone though it’s not yet clear if he was merely inspired by international jihadism – that is, he read news reports, watched their videos on social media and came up with the plan himself – or he was “enabled” – that is, he sought out and received help on how to plan his attack from the self-styled Islamic State.

But what we know for certain is that he was, as is a recurring feature of the “radicalisation journey”, in possession of a string of minor convictions from 1982 to 2002 and that he served jail time. As the point of having prisons is surely to deter both would-be offenders and rehabilitate its current occupants so they don’t offend again, Masood’s act of terror is an open-and-shut case of failure in the prison system. Not only he did prison fail to prevent him committing further crimes, he went on to commit one very major crime.  That he appears to have been radicalised in prison only compounds the failure.

The sad thing is that not so very long ago a Secretary of State at the Ministry of Justice was thinking seriously about prison and re-offending. While there was room to critique some of Michael Gove’s solutions to that problem, they were all a hell of a lot better than “let’s ban WhatsApp”. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.