Osborne could use Mansion House address to announce RBS sale

Chancellor George Osborne’s Mansion House address to senior City figures next week is expected to include a layout of plans for the selling off of the government’s 80 per cent stake in Royal Bank of Scotland.

According to reports, sources say that the Mansion House speech would be “an obvious platform” to outline future plans for the government’s stake in the Edinbuegh-based lender.

In the run-up to the general election, Mr Osborne signalled his intention to kickstart a disposal programme for RBS early in this parliament and he has previously used the set-piece address at Mansion House to outline policies on the banking sector.

While the Treasury has refused to comment on the speech, Mr Osborne has recently said he wants to “get the government out of the business of owning great chunks of our banking system”.

The government could begin selling by the end of the year, allowing RBS to finish a settlement with US regulators for mis-selling mortgage securities.

Meanwhile, the Treasury has already committed to selling more of its Lloyds shares within the next 12 months, as it was announced yesterday that another tranche of shares had recently been sold into the market recouping £10.5bn for the exchequer.

Meanwhile, a programme of drip-feeding Lloyds shares into the market – which was due to finish at the end of the month – is being extended to the end of the year, while some shares are being earmarked for sale to retail investors in the next 12 months.

In contrast with 80 per cent state-owned RBS, the government’s stake in Lloyds has now fallen below 19 per cent, having once stood at 45 per cent after the 2008 bailout when £20bn was pumped into it and HBOS.

Osborne did not make any reference to RBS as he set out his plan for Lloyds on Monday, but in March, during the run-up to the election, he made clear that his focus would be on RBS should he be returned to the Treasury.

“There are constraints around it, but it’s certainly something I would want to get moving on in the summer after the election. I would want to see a review on a plan for disposal,” he said in March.