The government’s decision to chose Royal Bank of Scotland as its new house bank is an odd one indeed.
The contract was put out to public tender, in accordance with European Union rules, and the good old Scots emerged top of the pile, ahead of Holland’s own financial services groups such as Rabobank (which currently has the contract) and ABN Amro, which is now owned by the government.
It was of course RBS that led the agressive takeover campaign for ABN Amro in 2007 and ended up paying too much. British taxpayers were forced to step in and bail out RBS, while Dutch taxpayers have done the same for ABN Amro.
And now Dutch taxpayers are going to pay a British (partly state-owned bank) to work for their own government. Oddly, the part of RBS which will be working for the government is an old bit of ABN Amro, now in Scottish hands.
The contract for tax payments is in the hands of ING, which has had a €10bn capital injection from Dutch tax payers, who are also guaranteeing €20bn of its dodgy US mortgage portfolio.
The big loser in all this is, of course, Rabobank – the only one of the big Dutch financial services groups not to have received any money from the state and not to be listed on the stock market. There must be a lesson in there somewhere.
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