RBS Rights Issue

1966

As I have a small (now probably worthless) holding of RBOS shares - what does a Rights Issue mean to me as an investor?

unclebill98

Nothing unless your an employee. Are you?

Blackjack

1966 wrote: »

As I have a small (now probably worthless) holding of RBOS shares - what does a Rights Issue mean to me as an investor?

Usually means you have a right to purchase more shares at a given price, usually depending on the number of shares you already hold.
It may be that you get 1 right for every share held and 10 rights can be converted to 1 share at a specific price - I don't have the details for this specific issue but you get the picture.
Why are your shares worthless?. They last closed at about 345p per share.

unclebill98

I would agree with the OP, there very poor at the moment.

They used to be £21 each, but last year the divided them by 3 and reduced the share price to £7, now there about £3.50 each.

The rights issue at the moment is 11 shares for every 18 held for a discounted price and its only open to staff.

Most stock brokers are advising against buying RBS. Its very very far from being a NR, so thats good.

Blackjack

Pretty poor alright.

Mind you, they're just worth less as opposed to worthless. About half what they were at 21 per share after a 3 for 1 stock split.

unclebill98

Yep, there not great. I'd be interested to see if many staff take up the offer.

1966

yes - am staff does would that make a difference?

Carlow52

unclebill98 wrote: »

I would agree with the OP, there very poor at the moment.

They used to be £21 each, but last year the divided them by 3 and reduced the share price to £7, now there about £3.50 each.

The rights issue at the moment is 11 shares for every 18 held for a discounted price and its only open to staff.

Most stock brokers are advising against buying RBS. Its very very far from being a NR, so thats good.

The staff are being asked for 12 bill stg : quite an ask IMO.

While in IMO mode, this is a great war chest to have so as they can buy up loads of stuff at a good price, for example sell UB to B of I and mop up AIB

unclebill98

1966 wrote: »

yes - am staff does would that make a difference?

Well, I am not sure if its only open to staff that already have shares. So, do you have any? Pm to discuss if you wish....

Carlow52 wrote: »

The staff are being asked for 12 bill stg : quite an ask IMO.

While in IMO mode, this is a great war chest to have so as they can buy up loads of stuff at a good price, for example sell UB to B of I and mop up AIB

emmm, no thanks. Already worn the BOI t-shirt, never again... I'd not be in favor of that.

ircoha

unclebill98 wrote: »

I would agree with the OP, there very poor at the moment.

They used to be £21 each, but last year the divided them by 3 and reduced the share price to £7, now there about £3.50 each.

The rights issue at the moment is 11 shares for every 18 held for a discounted price and its only open to staff.

Most stock brokers are advising against buying RBS. Its very very far from being a NR, so thats good.

UB: this post suggests that the rights issue is only available to staff which is clearly not the case.
http://www.businessworld.ie/cgi-bin/printer_friendly?a=2123449

stepbar

unclebill98 wrote: »

Well, I am not sure if its only open to staff that already have shares. So, do you have any? Pm to discuss if you wish....



emmm, no thanks. Already worn the BOI t-shirt, never again... I'd not be in favor of that.

That's not going to happen in my lifetime. The competition authority wouldn't allow it anyhow. How in ever if you think BOI is bad UB is ten times worse.

kmb

Just reading this and wondered as i have savings in first active monthly saver if all okay?Does this rights issue set alarm bells?
First active is part of RBS isnt it?
Please excuse my question but i am not well up on these things and dont want to jepordise the money in the account.
And all i keep hearing is the word credit crunch from every corner.

ALSO wondered if things did go pear shape how much of the money is guaranteed back?

regards

Kieran

unclebill98

stepbar wrote: »

That's not going to happen in my lifetime. The competition authority wouldn't allow it anyhow. How in ever if you think BOI is bad UB is ten times worse.

Well thats true Stepbar about not in your lifetime. As for the other comment, having worked for both companies for years I can honestly say that UB looks after its staff a lot better. As for customers, that can be a good and long argument/tread!

kmb wrote: »

Just reading this and wondered as i have savings in first active monthly saver if all okay?Does this rights issue set alarm bells?
First active is part of RBS isnt it?
Please excuse my question but i am not well up on these things and dont want to jepordise the money in the account.
And all i keep hearing is the word credit crunch from every corner.

ALSO wondered if things did go pear shape how much of the money is guaranteed back?

regards

Kieran

Yes FA is part of the RBS group. So is Lombard!

Well, Staff are not worried about this rights issue, its cause the share price to fluctuate 360-340, but thats normal. High level management have taken up the option to buy shares to show that its a good thing and to prove there trust in RBS future. I do agree that its a tall order to raise the money they want, but the discounted price is very good, so i can see plenty of people taking it up.

As for your money, your savings are safe up until 22k, anything after that you would loose if the Bank went bust. So, in saying that a sole account savings holder with 40k would loose 18k, but a joint account savings holder would be ok, as its 22k per person, so there safe up to 44k

I am glad i work in the branch, I'd be first in for my cash!

kmb

Thanks unclebill98 for the reply.
do me a favour though,make sure i am the second person in!! LOL.

Regards,

Kieran

unclebill98

No problem.....

stepbar

unclebill98 wrote: »

Well thats true Stepbar about not in your lifetime. As for the other comment, having worked for both companies for years I can honestly say that UB looks after its staff a lot better. As for customers, that can be a good and long argument/tread!

You can say that again

But a great analogy I use is that working for BOI is like playing for Manchester United, it's all about the prestige to go with the sh1te wages. Except BOI is more like Liverpool these days and still has the sh1te wages

kmb

Actually i was just wondering where does it say 22k is covered as i cant find it anywhere?

Would be handy if someone can show me where it says it just for peace of mind,no offence meant.

regards
kieran

unclebill98

stepbar wrote: »

You can say that again

But a great analogy I use is that working for BOI is like playing for Manchester United, it's all about the prestige to go with the sh1te wages. Except BOI is more like Liverpool these days and still has the sh1te wages

kmb wrote: »

Actually i was just wondering where does it say 22k is covered as i cant find it anywhere?

Would be handy if someone can show me where it says it just for peace of mind,no offence meant.

regards
kieran

Here you go.. section 4. Its 20k.

http://www.financialregulator.ie/frame_main.asp?pg=/industry/in_bci_dps_intr.asp&nv=/industry/in_nav.asp

nlgbbbblth

11 for 18 which means I gotta come up with approx £4,000.

Not entirely convinced if borrowing to purchase shares is a good idea.

unclebill98

How do you get that figure? You don't have to buy the max..

You can only opt in if you already own shares.

11 for 18 is just to set out the maximum you can buy.

I'd not be borrowing to buy shares.

nlgbbbblth

off topic: I've never encountered anyone in banking who knew what an internet message board / forum was.

nlgbbbblth

unclebill98 wrote: »

How do you get that figure? You don't have to buy the max..

You can only opt in if you already own shares.

11 for 18 is just to set out the maximum you can buy.

I'd not be borrowing to buy shares.

Number of released shares + number of unreleased shares multiplied by £2.

I hadn't got any clarification yet on how much you could go for i.e all / nothing / or halfway

Re borrowing: if they did special package ala Eircom 1997 - on an interest only basis, I may be tempted.

unclebill98

nlgbbbblth wrote: »

Number of released shares + number of unreleased shares multiplied by £2.

I hadn't got any clarification yet on how much you could go for i.e all / nothing / or halfway

Re borrowing: if they did special package ala Eircom 1997 - on an interest only basis, I may be tempted.

You take the shares you have, lets say you've got 1000. Divide that by 19 = 53 and then x11 = 579. So you able to buy a maximum of 579 @ £2 each. Which is £1158 worth of shares.

So to be able to even buy £4k worth of shares you'd have to already own about 3500 shares.

As for Loans for shares, i'd not say they'll be easy to get.

nlgbbbblth

unclebill98 wrote: »

You take the shares you have, lets say you've got 1000. Divide that by 19 = 53 and then x11 = 579. So you able to buy a maximum of 579 @ £2 each. Which is £1158 worth of shares.

So to be able to even buy £4k worth of shares you'd have to already own about 3500 shares.

As for Loans for shares, i'd not say they'll be easy to get.

I do.
I have around 3,200 shares. So I'm entitled to another 1,955.

Should have sold some a couple of years ago.....

unclebill98

Yeah, the price is shocking at the moment. So much for making them cheaper for people to buy!

daveirl

This post has been deleted.

unclebill98

Yes, its not just employee's its all share holders. My mistake.