FT Alphaville reported earlier on Tuesday that HM Treasury does not expect losses on its Asset Protection Scheme portfolio to exceed £60bn, meaning all of that will be borne by RBS as per the terms set out in the APS agreement.

Good thing too. Check out these numbers for assets guaranteed under the programme:

That makes for total foreign currency-denominated assets of roughly £161bn.

By contrast the UK had about $35bn in net foreign currency reserves at the end of November.

Which rather highlights the extent to which the fortunes of the banking industry have become entwined with that of UK Plc.

(H/T Sean Corrigan of Diapason Commodities Management).

Related links:
Barclays may reject Asset Protection – Robert Peston, BBC
NAO: First the good news… – FT Alphaville
Taking out the trash at RBS – FT Alphaville
How likely is a sterling crisis? – Willem Buiter’s Maverecon

This entry was posted by Tracy Alloway on Tuesday, December 8th, 2009 at 13:19 and is filed under Capital markets. Tagged with aps, currencies, HM treasury, rbs, sterling, UK. Edit this entry.