ANYONE KNOW WHY THE ROYAL BANK OF SCOTLAND IS SHOWING A SHARE PRICE AROUND THE 6.59 MARK WHEN IT WAS 18.00 OR SO THE OTHER WEEK OR AM I GOING STRANGE?????????????

I noticed that B&B denied rumours of rights issue last week, but RBS haven't they just say they have noted the speculation. So it looks like it could well be announced next Wednesday. I have RBS on my watch list to buy, and would certainly be interested in a purchase before any rights issue, which I would view as a positive move for the shares. Maybe not in the short term.

The other point to make is that they could use Wednesday trading statement to come clean over come clean about their exposure to instruments related to the sub-prime mortgage crisis.

Interesting week ahead..........

Up!

I'll never understand these markets.

I expected a drop and it goes up!

Maybe I should always trade in reverse to what I originally thought.

I could make a fortune.

(noted dearleader, thanks)

RBS is going up this morning.

However, re the effect of a rights issue on IEC: I think you'll find the sp dropped off a cliff on the day of the rights issue: down 25% or more (have a look at the IEC chart).

Sorry to disagree Toya.

Although the sp plummeted recently, the rights issue was announced Wednesday at 600p. The Stock opened at around 1000p and stayed there. It didn't dilute.

It now depends how much the rights issue is for.
Being a sceptic, I feel that RBS were reasonably happy that the potential of the issue had been a rumor for several months. As they did not (unless I missed it) deny the rumor me thinks they will ask for less than the 12 billion mentioned.
Banks have almost as much spin attitude as our government.
Rumor for 12 ask for 10 ish, looks good. The market as yet appears to like it. Doubt has almost been taken away. As we all know, markets don't like doubt.

With much of its earning other than stirling this looks like a good long term holding once they sort out their capitsal requirements.

Good point, I think PAG did also, will have to check. Market likes the idea of rights issue, and would think other banks could follow. Buy sp normally drifts down with rights issues.

The market is starting to realise this is not good news...RBS pulling back now.

Dealerdealer: you're right - I hadn't realise the actual rights issue re IEC was this week (I've been away). But the sp did plummet on 02 April, the day they announced that a rights issue was planned, from over 1250p to around 900p. Thats a fairly hefty drop and it's not got back up there yet.

Guess the market is reacting differently to the RBS announcement.

The risk to the divi is the problem here.

True. Maybe with the original drop the rights issue had been priced in

The divi is certainly a problem given the circumstances.

The market appears uncertain how to take this news/rumour, no doubt the weekend press will through more light on the situation. Everything hinges on whether and how much additional provisions have to be made for sub prime losses.

IEC also announced increased reserves at the same time as confirming the 600p RI, with no RI, the sp would have improved on the news...

awful timing with the Amro acquisition which has probably made things worse for them.This is a tricky one for the advisers since they would wish the sp to stabilise so as to get the new issue away and get the issue underwritten. If this rumour is true I think the sp will weaken prior to the issue and stabilise after as many may see this as a watershed. May buy an interest once the dust has settled but we need to see the figures first. In some ways it may be better if they rebase the dividend to reflect the conditions and this may happen if the management changes. This of course would have to be mentioned at the time of any rights issue so this factor would be considered when being underwritten.

Well my short is doing nicely this morning. But agree things may well pick up on Wednesday of next week

As a long term holder of a lot of inherited RBS shares as long as they don't go bankrupt, I don't care too much what the sp does in the near term. I keep them for the large divi each year. A reduction in that is unacceptale to all shareholders through very poor management so Goodwin would have to go.

Will Barclays have the last laugh at Goodwin's expense?