I think RBS is bust but nobody is telling us.

In the old days the Bank of England used to take its time sorting out a collapsed bank such as Johnson Matthey and in some cases it would make a profit. The official
scheme is for Royal Bank of Scotland (RBS) to keep on lending, sort out the toxic stuff, make profits and then reduce the British state holding in the bank to a more reasonable level. However, it might be that RBS is bust and would need the tender treatment of the Bank of England reserved for collapsed banks of yore.
For instance, if we are wondering about the future of the City of London, then we might have to let Edinburgh as a financial centre look after itself. I think it could survive the wounding up of RBS.
Would New Labour and the Scottish National Party (SNP) allow the dismantling of RBS, which is about to take a £500m hit on Cattle's according to the Sunday Telegraph, just to save a few billion? Obviously not but if it is £100bn, then there might not
be much choice. Perhaps, the regulator Financial Services Authority (FSA) could fudge
the issue for a few years.