Supplementary evidence from HM Treasury
At a hearing of the Committee on 2 February Sir Nicholas
Macpherson and Tom Scholar provided evidence on the Asset Protection
Scheme. In response to a question by the Chair, Tom Scholar stated
that the Asset Protection Agency (APA) was about to report an
updated loss estimate for the Scheme. The APA did this in its
interim report for the period 1 July 2010, which was published
on 15 February.
The report gives an expected loss outcome as of the
31 December 2010 of £51 billion. This is down from £57
billion reported in the APA Annual Report and Accounts 2009-10.
The first loss in the Scheme is set at £60 billion, meaning
that all losses on the assets covered by the Scheme up to this
level are borne by RBS. The lower expected loss outcome means
that the likelihood of RBS being able to make a claim under the
Scheme has receded. It also means that the APA is no longer projecting
any temporary pay-out under the scheme (the previous projection
was for a small temporary pay-out between Q4 2012 and Q1 2015,
to be repaid later out of subsequent recoveries.
February 2011
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