RBS has cut the size of a loan portfolio it is selling by just under half, to £1.6bn. Advised by Lazard, the bank had originally considered selling up to £3bn of loans, but reduced this figure after receiving initial expressions of interest.
A source close to a potential bidder said: “[RBS] may have tried to make [the portfolio] more ‘non-performing’ because it felt pricing would be too far apart on better quality loans.”
Bids are expected to be a lot lower than the loans’ face value. Lone Star, Starwood Capital and Blackstone have been asked to sign a non-disclosure agreement ahead of a firm bidding process opening.
RBS is seeking a partner to take an equity stake, asset manage the loans and inject equity where necessary. It hopes to complete the deal by the end of Q1 2011. The sale is part of the bank’s plans to sell or wind down up to £44bn of property loans by 2014.