After more than four years of attempting to sell Direct Line, Royal Bank of Scotland now looks set to float the home and motor insurer; the sale of the first tranche of shares could be just weeks away.
IC TIP:
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But this is a forced sale. To help compensate for the bank's bailout in 2008, EU competition regulators require RBS to sell Direct Line by the end of 2014. But flotation in today's stock market is hardly ideal. Moreover, half-year figures from Direct Line revealed that the unit is making underwriting losses, with a combined ratio (of claims to premiums) of 101 per cent. Rivals, such as RSA and Admiral, remain profitable.
