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London - The Royal Bank of Scotland plans to put about £300bn worth of unwanted assets on the chopping block, newspaper reports said on Sunday, vastly scaling back the bank's presence abroad.
The Sunday Telegraph said RBS would work to divest itself of the assets, such as the Asian and Australian units it acquired through the purchase of ABN Amro, over the next five years. The paper said some mortgages and lending assets held by the Charter One bank in the US were also slated for sale.
Similar reports were carried by other British media outlets. The Sunday Times said the restructuring would eventually lead to loss of 20 000 jobs, or around a tenth of the bank's global work force, and save more than £1bn a year.
The Edinburgh, Scotland-based bank declined comment on Sunday.
The Telegraph said the restructuring would see RBS pull out of about half of the 60 countries in which it currently operates, including parts of eastern Europe, Indonesia and Malaysia. The paper said the British government, which owns more than two-thirds of the troubled bank, approved the plan.
Britain's treasury did not immediately return a call seeking comment.
The reported plan would be a retreat from RBS's once-aggressively expansionist strategy.
A few years ago the lender was buying assets across the globe: Its US subsidiary, Citizens Financial Group, purchased Charter One in 2004. In 2005, RBS spent billions for a stake in the Bank of China, and - most controversially - it led a consortium that acquired ABN Amro in October 2007 for more than £70bn.
But the Dutch bank's massive carve-up depleted RBS's reserves just as the credit crunch began to bite, driving the bank to brink of collapse last autumn. The government has pumped £20bn into the institution to keep it afloat, but RBS has warned investors it would announce the largest full-year loss in British corporate history next week - up to £28bn.
The Times and the Telegraph also said that RBS was poised to insure about £200bn worth of shaky assets with the British government's asset-protection plan.
Under the plan, the government has offered to insure banks against default on toxic loans in exchange in return for a fee and legally binding commitments to make credit more available to British businesses and home buyers.
- AP