Shares in Royal Bank of Scotland, the London listed British bank, rose towards 5 per cent yesterday afternoon, after unconfirmed reports an Abu Dhabi sovereign wealth fund is seeking to buy the bank.
RBS up on report of local buyer
Shares in Royal Bank of Scotland (RBS) rose by almost 5 per cent in early London trading yesterday amid speculation over a potential deal to sell a majority stake the troubled bank to a UAE investor.
RBS stock was up 4.4 per cent to 28.97 pence per share in mid-afternoon trading. The rise followed a report by the BBC that the UK government had held talks to sell some of its controlling stake in the bank to an Abu Dhabi wealth fund. The BBC report remained unconfirmed last night.
The British government bought a majority stake in RBS to prevent the bank from collapsing in 2008 and in 2009 took its ownership to 82 per cent. It paid about 50 pence a share, almost double the stock's current price.
In the UAE, the Abu Dhabi Securities Exchange (ADX) General Index edged 0.1 per cent lower to 2,574.57. The Dubai Financial Market (DFM) General Index dropped 0.1 per cent to 1,652.44. Analysts said they expected little movement on the exchanges before the start of the next quarter, when companies begin reporting on their performance for the first three months of the year.
"At the moment it's just markets trying to hold on to gains achieved so far this year," said Fadi Al Said, the senior fund manager at ING Investment Management in Dubai. The DFM is up about 22 per cent in the year to date. The ADX has risen almost 8 per cent.