Fears RBS will need second bail-out

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WHITEHALL officials fear the Royal Bank of Scotland could have to be bailed out for a second time as part of efforts to recapitalise the crisis-hit banking sector in Europe.

The Edinburgh-based banking giant may have to be completely nationalised as part of an attempt by Europe to restore faith in the banking system.

At £45 billion, RBS received the largest bailout of any bank in the world during the crisis.

Reports today suggested the European Banking Authority will carry out more checks on banks’ balance sheets – even if they passed the first round of checks in July.

One government official was quoted saying: “[RBS’] sovereign exposure is not fundamentally worrying but if there is a broader European drive to recapitalise the banks it’s conceivable they may need more government money.”

RBS declined to comment on the reports.