Page 4 - RBS GRG F Case Study

Royal Bank of Scotland

Global Restructuring

Group

The Royal Bank of Scotland

(RBS) is a world leading financial
institution.

When the credit crunch hit in

2007/8, RBS was riddled with risky investments that

imploded. By 2008 its balance sheet was bigger than the

entire UK GDP at £2.2 trillion. Thus, when the mortgage

market collapsed, the bank was unable to handle the

amount of people defaulting on their loans or the value

of assets becoming worthless. Consequently, over

2008/2009 as RBS’ share price collapsed the British

government paid £45.4 billion to bail it out, ending up
with an 81% ownership stake.