Royal Bank of Scotland was bailed out by the UK government last year Three new High Street banking chains are to be created by the government as part of a major overhaul.They will be set up by breaking up Royal Bank of Scotland, Lloyds and Northern Rock, the banks it partially or wholly controls after bail-outs. The move, by 2015, aims to increase competition and recoup taxpayers' cash. It comes as ministers hold negotiations with the European Competition Commissioner over reducing the scale of state-supported banks. The government, which holds a 70% stake in RBS and a 43% stake in Lloyds after last October's bailouts, hopes to announce the sell-off plans on Tuesday. The announcement comes after the EU last week backed plans to split nationalised Northern Rock in two. BBC Scotland's business and economy editor Douglas Fraser said the government was taking part in four-way negotiations with Lloyds, RBS and the European Commission, which have been described as "brutal" by one source, and "very delicate" by another.[Read more...]