Just another thought

Mr Peter Oborne in The Telegraph is known for occasionally putting forward seemingly crackpot ideas, but this seems worth pursuing:

... by the Chancellor’s own logic, RBS is a prime candidate to be broken up.
More encouragingly still, most of its businesses are fundamentally sound, and the original Royal Bank of Scotland still exists. It was granted a charter by George I as long ago as 1727 and is one of the very rare British banks with the authority to issue its own bank notes. It is screaming out to be split off from its ruined parent organisation, recapitalised and sold to the public.
The same applies to Natwest. This is a first-class clearing bank acquired by the RBS group in a stock-market coup 10 years ago. Its reputation has been damaged thanks to its association with this humiliated group and it, too, urgently needs to be given back its independence. Exactly the same argument applies to the smaller banks that still belong to Mr Goodwin’s doomed business empire – The Ulster Bank, Child & Co, Adam & Company as well as Coutts, long standing bankers to the royal family.
These banks have well-known brand names and are part of a fine historical legacy that can only be fully restored by removal from the RBS state-owned morass. Finally, the same surely applies to RBS’s well-regarded insurance subsidiaries, Direct Line and Churchill. Indeed, it is impossible to understand what benefit these businesses gain from being run by the former Credit Suisse investment banker Stephen Hester, whatever the size of his bonus.

Why not?  Where is the logic of retaining them under the baleful domination of RBS?  And it would encourage competition.

Much the same applies to Lloyds.  It might be difficult (but surely not impossible) to disentangle the decent bits of the Bank of Scotland, the Halifax and Scottish Widows from the Lloyds/TSB operation and put them back into the private sector.  But why keep them all together?

The government is in control of both these super-banks (or not so super banks); if Osborne would pull the finger out and get on with it, we could then look critically at the bits that were left and plot a way forward.