Now that the UK government has ‘obtained’ a large stake in Lloyds, and RBS, the question is whether we should sell off that ownership when things improve. Hopefully we will be hanging onto the banks until we can make a decent profit from helping them out. But what would happen if we kept hold of them ?
Well we would essential lose the capital (or more accurately it would be locked into the investment), but we would get paid dividends every year. Or every year they are paid.
We would also have a greater influence on keeping the banks and bankers well behaved. Given the behaviour of the banks in the past, it would seem to be worth having a “finger in the pie” to keep an eye on their future behaviour.
Some are complaining that the government (and thus the taxpayer) is taking unfair advantage of the shareholder because we are getting a huge number of shares at a very much reduced price. Tough. Those same shareholders were taking advantage of unsound banking practice in the past when they should have been insisting that the banks were properly run.