James Ashton: Price RBS right and the State will sell it. But we have been warned

My Week

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The Independent Online

George Osborne has put plenty of pressure on Royal Bank of Scotland over the past five years. Make it safe, make it lend and, now, make it saleable.

As this week’s latest IT meltdown shows, the Chancellor might have chosen to add another demand before deciding the time is right to get RBS off the State’s books: make it invest in its computer systems.

That 600,000 payments and direct debits should go missing just as Mr Osborne and the Governor of the Bank of England agreed the time was right to sell off RBS hardly whets the appetite of the City institutions that might be expected to take up the shares. It was as if RBS’s owners and regulators had colluded to leave it exposed. Where its balance-sheet defences have been built up at great expense, its resistance to cyber attack looks flimsy.

It is a story not unfamiliar across the rest of the industry: occasional IT outages act as a reminder that high street lenders are struggling to cope after years of underinvestment, just as consumers are being asked to put more faith in technology. My favourite example of creaking banking IT came a couple of years ago when, in a Treasury Select Committee hearing, the MP Mark Garnier let slip that he had heard the computer systems behind the 632 branches that Lloyds was trying to sell – and which later became TSB – contained software to convert pounds, shillings and pence into decimal currency.

Yet days before RBS blew a fuse, the British Bankers’ Association proudly announced that smartphones and tablets had overtaken using branches and the internet as the most popular way to bank.

If this is the direction of travel, can RBS cope? As Royal Mail showed, the Government can sell anything if it is priced cheaply enough, and Mr Osborne has lost patience with the idea of turning a profit on the £45bn bailout. So soon after banks paid out billions in fines and compensation for various mis-selling scandals, those who choose to pick up some of the millions of RBS shares on offer should be fully appraised of what they are getting.

Can the Murdochs avoid double trouble at the top?

Boardroom double acts rarely work and family firms often founder when they are handed on from one generation to the next. So Rupert Murdoch’s decision to install his sons Lachlan and James in partnership at the helm of 21st Century Fox this week could be viewed as a brave one. It might be, except the 84-year-old mogul is going nowhere fast. Also, the family still controls 40 per cent of the voting rights, which insulates it from outside investor pressures.

The Murdochs know all about family disunity, having exploited it when News Corporation acquired The Wall Street Journal from the Bancroft family in 2007. What happens when Murdoch Snr passes on his shares to his six children is anyone’s guess. In the meantime, the brothers must prove they can do a better job together than Anshu Jain and Jürgen Fitschen at Deutsche Bank, the most recent example of how two leaders are prone to create a foggy strategy and suffer from weak execution.

If they do fail to gel, there is always their eminently sensible sister Elisabeth to pick up the pieces. Few remember that she was about to join the board of News Corp pre-demerger, but decided not to when the phone-hacking scandal broke. While what is now 21st Century Fox soaked up her production house Shine, Elisabeth has contented herself running Freelands, a digital investment fund.

Greeks will suffer, markets will take it in their stride

A FTSE 100 chief executive described to me his planning for a Greek exit from Europe thus: “We discuss it, we agree it’s a risk and we move on to the next thing.”

Being permanently on standby for something momentous is exhausting. Business life continues while the crisis rumbles on. The Greek situation was a factor even five years ago, when the coalition government was being put together – one reason why Liberal Democrats and Tories teamed up so quickly.

British banks don’t lend much to Greece, and few British businesses have much activity there. Where they will get hit is by the market turmoil and the knock to economic confidence in the eurozone, though central bankers believe enough has been done to prevent contagion spreading to other financial weaklings like Portugal.

What is surprising is how European bond markets have held steady this week, despite the escalating rhetoric between Greece and its creditors. Of course, deterioration can happen fast. But while politicians prevaricate, traders know there is always another final day of reckoning, as the Brussels leaders’ summit conjured up for Monday demonstrates.

After so many false starts, Monday might actually herald the beginning of the end. A “take it or leave it” offer plus formal deadline will give the country nowhere left to run. The International Monetary Fund has made it clear there is no grace period to make the £1.1bn payment due on 30 June.

However long it has been telegraphed, a default and devaluation will be devastating for the Greeks, especially those savers who have not already followed professional investors by switching funds to safer havens. But the unforgiving markets will take it in their stride.