Bail Out the Banks

478 Words2 Pages
Give public bailed-out banks shares says Nick Clegg What are the stakeholders in this case study? The stakeholders in this case study would be the 45 million people on the electoral roll who would be given free shares in the bailed-out banks. Tax payers would be considered as stake holders because they own 83% of RBS and 41% of Lloyds after the government invested about £65.8bn in 2008 at the height of the banking crisis. Also the Royal Bank of Scotland (RBS) and the Lloyds banking group would have an interest in this case study. Identify the needs of the stakeholders in this case study. The needs of the taxpayers would be that they would rely on income and financial support from having an investment in the business. In this case the taxpayers own 83% of RBS and 41% of Lloyds demanding for an increase in the value of their investment. Tax payers may withdraw their share of the company if the actual or projected financial return is no longer profitable for them. Identify the possible causes of conflict which may arise in this situation. A cause of conflict would be that it is not fair on the taxpayer because they do not have say in the company; this is because they only own a minority share. The taxpayers are giving their money to bail out the banks and in return they may not receive a sufficient return on their share. Once again the taxpayer is being forced to bail out a major bank without it being in the interest of the taxpayer. This links in with an argument from shadow chancellor Ed Balls who claims that Nick Clegg’s proposal has not been thoroughly thought through, because it is not in the long-term interests of the taxpayer. This is because taxpayers do not know how long it will take for their money to be given returned to them. If the banks were to go bust again the taxpayer’s tax will most likely be used to help
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