RBS tightens belt, looks to sell WorldPay

Less than a handful of days after announcing its sale of 318 Wiliams & Glyn branches, the Royal Bank of Scotland prepares to sell WorldPay, the company that handles payment processing for the bank.

Both Bain Capital and Advent International have been rumoured to be in contention for WorldPay; both private equity firms have purportedly been discussing possible arrangements with RBS since some time in July.

The sale of WorldPay could bring up to £2.5 billion into RBS’s coffers, helping to satisfy the European Commission-mandated asset selling scheme that was put into place as a punitive measure for RBS’s government bailout at the inception of the global banking crisis.

The bank has disposed of many of its assets over the past half year in light of the European Commission measure; the recent sale of 318 branches to Spain-based banking conglomerate Santander last week for £1.65 billion being the most recent.

RBS, which is  83 per cent nationalised due to the taxpayer bailout, also recently announced that the banking group’s diminishing bad debt charges played a major role for increased profit  over the first half of 2010.

Compared to figures the bank released for the first half of 2009, the bank has turned a net loss of £1.04 billion in to a £9 million net profit.  The banking group also stated that it was well on its way to meeting its target goals for UK business loans in addition to its goals for mortgages.

Compared to RBS’s massive net reported loss of £24.1 billion in 2008 (the most significant annual loss in the history of UK corporations), the figures it released recently are demonstrative of the bank’s improvements.

Stephen Hester,  chief executive for the Royal Bank of Scotland, released a statement in which he declared that the bank was progressing well with not only its mandated disposal of assets but also in the overall restructuring of its business in general.

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