UK gova has effectively given the banks the option of taking up capital in exchange for govt ownership. Note that these are politicians so they'll be reacting emotionally to the issues of the day.
2ndly, this is a retrospective step mean to cure known toxic stuff in the banks balance sheets as of now. It like the US zillion game doesn't tackle the underlying depreciation in assets which is the main cause of the toxic stuff. We won't get to the stage that we have a normal banking system until lending and deposit holding is behaving normally.
Finally, we still need some of securitisation for the mortgage market to grow. When will this happen?
UK Stockwatchlist: RBS, rbs. Goodwin will deliver some upside...