Bloomberg News

RBS’s Bad Bank Sells First Distressed Property Assets to Vaerde

December 06, 2013

Royal Bank of Scotland Group Plc sold its first distressed U.K. property assets since a bad bank was set up last month, according to a person with knowledge of the matter.

RBS sold the industrial warehouses for slightly more than the asking price of 63 million pounds ($104 million), said the person, who asked not to be identified because they weren’t allowed to comment publicly. The buyer was Minneapolis-based hedge fund Vaerde Partners LP, said the person.

The nation’s largest state-owned bank said on Nov. 1 it had reached an agreement with the U.K. government to set up an internal bad bank for about 38 billion pounds of toxic assets. With the next election in 2015, Chancellor of the Exchequer George Osborne needs to convince voters he is recouping the 45.5 billion-pound cost of RBS’s government bailout while giving the Edinburgh-based bank room to clean up its balance sheet.

David Gaffney, an RBS spokesman, declined to comment. A Vaerde spokesman wasn’t immediately available to comment. The Financial Times reported the news earlier today.

To contact the reporter on this story: Gavin Finch in London at gfinch@bloomberg.net

To contact the editor responsible for this story: Simone Meier at smeier@bloomberg.net


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