Budget documents estimate we have lost £6bn at the moment on the bailouts, but things are improving. The Asset Protection Agency forecasts we should gain £5bn from the schemes eventually.
The Bank of England has also been indemnified in providing £200bn of liquidity support, guaranteeing up to £250bn wholesale borrowing to the banks to strength their liquidity. Plus there has been more funding for the Bradford and Bingley and the Financial Compensation Scheme.
Add these sums, and more, up and it comes to around £850bn support for the banks to prevent anyone going bust and keep the economy moving (although it is doubtful if it is...). The banks promised to continue lending, or overdraft facilities to business. But they are falling short of this , RBS by £25bn and Lloyds by £14bn.
Advice, for £107.1m
One of the significant costs incurred is £200k/month for a year to Credit Suisse and Deutsche Bank as retainers for the treasury immediate back-up needs. And they could be in line for £1.5m "success fees" for Credit Suisse and £110k/month for Deutsche.
Credit Suisse also got a £300k/month contract to advise the Asset Protection Scheme over future losses, plus more "success fees" of £3m. They could benefit from up to £15.4m by March 2011.
Slaughter and May, legal, gets £32.9m and Pricewaterhouse @11.3m for there work on Asset Protection.
And the outcome???
Now what is very uncertain is the outcome. We have no Obama-like commitment to have the banks pay back "every penny". But we need this. In fact we want to make a good profit, to allow for inflation, and especially as the bankers are plunging ahead with large bonus payments out of tax payer's money.
At election time this is what parties have to commit to.
In short - the numbers
£76bn To purchase shares in RBS and Lloyds Banking Group
£200bn Indemnify Bank of England against losses incurred in providing over £200bn of liquidity support
£250bn Guarantee wholesale borrowing by banks to strengthen liquidity in the banking system
£40bn Provide loans and other funding to Bradford & Bingley and the Financial Services compensation Scheme
£280bn Agree in principle to provide insurance for selection of bank assets
£671bn Total Government spending in the financial year 2009-2010
£32.9m Slaughter & May - Commercial legal advice
£15.4m Credit Suisse - Financial advice on a range of measures, including Bank Recapitalisation and the Asset Protection Scheme
£11.3m PricewaterhouseCoopers - Advice on APS
£8.7m Ernst & Young - Due diligence on APS, Northern Rock
£7.7m KPMG - Due diligence on APS
£7.4m Blackrock - Valuation advice on APS
£5.3m Deutsche Bank - Financial advice on a range of measures
£5m Citi Financial - Advice on Aps
£4.9m BDO Stoy Hayward - Valuation of Northern Rock
£4.5m Goldman Sachs - Financial advice on Northern Rock
£1.5m Morgan Stanley - Financial advice on Bradford & Bingley
£2.5m Other advisers - Financial advice on a range of measures and proposals to revive Britain's ailing economy
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