The Government has discussed selling some of the taxpayer's holding in Royal Bank of Scotland to an Abu Dhabi sovereign wealth fund as the authorities continue to look for ways to cut the state's stake in the lender.
K Financial Investments, which manages the state's 82pc stake in RBS, held talks recently with Abu Dhabi wealth funds, though a source said the discussions were not at an advanced stage and no sale was expected in the near future.
At current market prices the holding is worth £13.5bn, well below the £45.5bn cost of the direct taxpayer bailout of the bank in late 2008 and early 2009.
A spokesman for the Treasury said: "The aim is to repair and return RBS to full health so that it is able to support the UK economy in the future, and the current strategy is working to achieve that.
The Government's policy has always been to return RBS to the private sector, but only when it delivers value for money for the taxpayer."
RBS and UKFI declined to comment.
The Abu Dhabi Investment Authority is the world's largest sovereign wealth fund with an estimated $627bn (£395bn) of assets.
However, several other Middle Eastern wealth funds have been targeted as potential buyers of shares in RBS.
Last year representatives of RBS met with the Kuwait Investment Authority, which manages funds worth nearly $300bn. Qatari and Saudi Arabian funds are also seen as potential buyers of some of the state's holding in RBS.
A survey earlier this month of City fund managers by Capital Spreads found little interest in buying RBS shares at the Government's break-even price of 50p.
Nearly three-quarters of the 200 managers surveyed said they would not buy shares in RBS even if they reached this level, and Simon Denham, chief executive of Capital Spreads, said the bank was a "dud investment".
Mr Denham said there was "little surprise" that the Government was looking to offload the holding to wealth funds like Abu Dhabi.
"The Coalition is probably crying out for a buyer so that it doesn't have to deal with defending bankers' bonuses in a year's time," said Mr Denham.
Selling RBS shares at the moment could prove difficult as the bank is currently restructuring its investment banking operations as part of an overhaul of its business.
Stephen Hester, chief executive of RBS, has repeatedly called for the Government to reduce its holding in the bank, saying it would be a sign of the lenders recovery from the financial crisis.
telegraph.co.uk
K Financial Investments, which manages the state's 82pc stake in RBS, held talks recently with Abu Dhabi wealth funds, though a source said the discussions were not at an advanced stage and no sale was expected in the near future.
At current market prices the holding is worth £13.5bn, well below the £45.5bn cost of the direct taxpayer bailout of the bank in late 2008 and early 2009.
A spokesman for the Treasury said: "The aim is to repair and return RBS to full health so that it is able to support the UK economy in the future, and the current strategy is working to achieve that.
The Government's policy has always been to return RBS to the private sector, but only when it delivers value for money for the taxpayer."
RBS and UKFI declined to comment.
The Abu Dhabi Investment Authority is the world's largest sovereign wealth fund with an estimated $627bn (£395bn) of assets.
However, several other Middle Eastern wealth funds have been targeted as potential buyers of shares in RBS.
Last year representatives of RBS met with the Kuwait Investment Authority, which manages funds worth nearly $300bn. Qatari and Saudi Arabian funds are also seen as potential buyers of some of the state's holding in RBS.
A survey earlier this month of City fund managers by Capital Spreads found little interest in buying RBS shares at the Government's break-even price of 50p.
Nearly three-quarters of the 200 managers surveyed said they would not buy shares in RBS even if they reached this level, and Simon Denham, chief executive of Capital Spreads, said the bank was a "dud investment".
Mr Denham said there was "little surprise" that the Government was looking to offload the holding to wealth funds like Abu Dhabi.
"The Coalition is probably crying out for a buyer so that it doesn't have to deal with defending bankers' bonuses in a year's time," said Mr Denham.
Selling RBS shares at the moment could prove difficult as the bank is currently restructuring its investment banking operations as part of an overhaul of its business.
Stephen Hester, chief executive of RBS, has repeatedly called for the Government to reduce its holding in the bank, saying it would be a sign of the lenders recovery from the financial crisis.
telegraph.co.uk
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