RBS boss signals 2014 timetable for the sale of taxpayer stake

RBS is first up with its annual general meeting tomorrow after recently offering Chancellor George Osborne an early election boost by predicting the Government should be able to start selling off its stake within a year.

In the clearest signal yet of a timetable for the Government’s stake sale, RBS chairman Sir Philip Hampton said the institution’s recovery would be “substantially complete” by the middle of 2014, paving the way for its return to the private sector.

The comments came as the 81 per cent state-owned bank reported its best quarterly performance since 2011, swinging out of the red with pre-tax profits of £826m in the first three months of the year.

Lloyds has also fuelled talk of Government plans to off load shareholdings after its first quarter figures likewise showed further progress in recovery efforts.

The group, which is holding its shareholder meeting on Thursday, said underlying profits trebled to £1.5bn from £497m a year earlier thanks to falling bad debts, cost cutting and the absence of more mammoth claims provisions. Its profits turnaround has seen shares rise close to the 61p average price paid by the Government during the bank’s bailout in 2008, sparking speculation over when ministers may aim for a re-privatisation, given the 2015 general election.

But investors may also take the chance to quiz bosses at both banks over the recent collapse of their branch sales. Lloyds, which is 39 per cent owned by the government, was the latest to announce its deal had fallen through, when the Co-operative Group pulled out of buying more than 600 branches last month.

RBS saw Santander withdraw from buying some 300 branches last year and both banks are now looking to float them to appease European rules on state aid.