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RBS begs for more time to sell UK branches

The state-controlled bank posts £5.17bn pre-tax loss in 2012

The Royal Bank of Scotland (RBS) has informally requested the European Commission (EC) to extend time until the end of 2013 to complete sales of its more than 300 branches.

In its request, the British bank said the commission that it recorded a £5.17bn pre-tax loss in 2012 due to a series of scams and confirmed its plans to carry out a partial flotation of its US bank, Citizens. In addition, the bank also said it was converting its branches into a standalone business that could be floated or sold eventually to a trade buyer.

A planned sale to Spain’s Santander worth £1.65bn fell apart in October 2012.

Stephen Hester, CEO of RBS, said: “There aren’t a lot of buyers for UK banks right now. I think that will change over time.”

RBS has now set aside £2.2bn to resolve its share of the industry-wide scandal apart from an extra £650m at the end of 2013 for its mis-sold interest rate hedging products.

The group paid £381m to the US and UK regulators for the settlement of the Libor rate-rigging scandal. “The group continues to co-operate with other bodies in this regard and expects it will incur some additional financial penalties,” the bank said.

The bank has to sell its more than 300 UK branches as a condition of the commission’s endorsement of its rescue by the UK government.

Meanwhile, RBS shares fell by 2.3 per cent to 338.8p.

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Geoffrey Howe dies, aged 88

Howe was Margaret Thatcher's longest serving Cabinet minister – and the man credited with precipitating her downfall.

The former Conservative chancellor Lord Howe, a key figure in the Thatcher government, has died of a suspected heart attack, his family has said. He was 88.

Geoffrey Howe was the longest-serving member of Margaret Thatcher's Cabinet, playing a key role in both her government and her downfall. Born in Port Talbot in 1926, he began his career as a lawyer, and was first elected to parliament in 1964, but lost his seat just 18 months later.

Returning as MP for Reigate in the Conservative election victory of 1970, he served in the government of Edward Heath, first as Solicitor General for England & Wales, then as a Minister of State for Trade. When Margaret Thatcher became opposition leader in 1975, she named Howe as her shadow chancellor.

He retained this brief when the party returned to government in 1979. In the controversial budget of 1981, he outlined a radical monetarist programme, abandoning then-mainstream economic thinking by attempting to rapidly tackle the deficit at a time of recession and unemployment. Following the 1983 election, he was appointed as foreign secretary, in which post he negotiated the return of Hong Kong to China.

In 1989, Thatcher demoted Howe to the position of leader of the house and deputy prime minister. And on 1 November 1990, following disagreements over Britain's relationship with Europe, he resigned from the Cabinet altogether. 

Twelve days later, in a powerful speech explaining his resignation, he attacked the prime minister's attitude to Brussels, and called on his former colleagues to "consider their own response to the tragic conflict of loyalties with which I have myself wrestled for perhaps too long".

Labour Chancellor Denis Healey once described an attack from Howe as "like being savaged by a dead sheep" - but his resignation speech is widely credited for triggering the process that led to Thatcher's downfall. Nine days later, her premiership was over.

Howe retired from the Commons in 1992, and was made a life peer as Baron Howe of Aberavon. He later said that his resignation speech "was not intended as a challenge, it was intended as a way of summarising the importance of Europe". 

Nonetheless, he added: "I am sure that, without [Thatcher's] resignation, we would not have won the 1992 election... If there had been a Labour government from 1992 onwards, New Labour would never have been born."

Jonn Elledge is the editor of the New Statesman's sister site CityMetric. He is on Twitter, far too much, as @JonnElledge.