RBS £3bn shot in the arm for
commercial property sector
Royal Bank of Scotland is planning to sell off a £3 billion portfolio of commercial property loans in a move that will test the market and reduce its own exposure in that area over the next five years. The move is part of Chief Executive Stephen Hester’s strategy to refocus the bank on its core markets and rebuild.
Since 2008, RBS has been steadily reducing its property loan book and has succeeded in so far shifting over £13bn. The bank was a major lender in the sector in recent times but was hit badly in the downturn.
There is continued uncertainty surrounding the commercial property sector in the UK, so it remains to be seen what the reaction and take-up will be like. However RBS report that they are making good progress against their targets to reduce the balance sheet.