January 05, 2012, 1:53 AM EST
By Howard Mustoe
Jan. 4 (Bloomberg) — Royal Bank of Scotland Group Plc, the U.K.’s largest publicly-owned bank, hired Lazard Ltd. to advise on the sale of parts of its equities unit, including stockbroker Hoare Govett, said a person with knowledge of the talks.
The bank is yet to decide what parts of the operation may be sold beyond Hoare Govett, said the person, who declined to be identified because the matter is still under discussion. Officials at Lazard and Edinburgh-based RBS declined to comment.
RBS Chief Executive Officer Stephen Hester, 51, is shrinking the lender’s securities unit after the bank received the biggest banking bailout in the world in 2008. Hester said in November plans by the government-backed Independent Commission on Banking will force the lender to cut the division further.
The bank may sell or shut the equities unit, which includes Hoare Govett, two people with knowledge of the situation said on Dec. 19. A formal announcement is expected by the time the bank reports full-year earnings at the end of February, the people said at the time. Sky News reported Lazard’s appointment today.
The investment bank, which employs about 19,000 people, posted a 29 percent drop in revenue in the third quarter compared with the year-earlier period. Within that, the equities operation employs about 1,000 people.
RBS has already cut more than 30,000 jobs since its bailout. In August, the bank said it will cut a further 2,000 job cuts at its securities unit over the next 12 to 18 months.
–With assistance from Ambereen Choudhury in London. Editors: Edward Evans, Steve Bailey.
To contact the reporter on this story: Howard Mustoe in London at hmustoe@bloomberg.net.
To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net
