Bostock's Move A Big Psychological And Structural Blow For RBS - Raymond

JOSH RAYMOND: "Absolutely, yeah, I mean everyone knew that Royal Mail was going to get into the FTSE 100 as soon as it listed just purely on the base of that as market valuation was very strong and it belonged in the FTSE 100, so no real surprise. It's another big day for Royal Mail. The IPO obviously, you've seen the share price rise since then and now it's now a FTSE 100 company too."JOURNALIST: "And what's the entry going to do to its share price?"

JOSH RAYMOND: "Well, normally, what you find is when stocks come into the FTSE 100, it actually tends to trade quite bullishly because you got tracker funds that automatically go and put some money into them and pick up some of the shares. So, on that perspective, I mean, I would expect the shares to probably open quite strongly on that basis. And also on a sentiment perspective, again, it's more positivity around the share price and around the company as a whole."

JOURNALIST: "All right, a bit of a slap in the face for RBS from Nathan Bostock. Who fills his shoes now at RBS and how do they move forward from here?"

JOSH RAYMOND: "That's the big question. You know, it really is a slap in the face because this guy was their- he'd been Finance Director, he was in the job, what, 10 weeks? He's resigned already so not is it only a sentiment blow for them but also from a structural blow as well because he was going to be the guy that was going to clean up the mess, move the bad debts into the bad bank side of the business and really spend the next two years or so focusing on that and trying to turn the bank around in terms of siphoning off and deleveraging and it's not going to happen now. So who's the guy, who's going to come in and do that, that's the uncertainty and I think that's why shareholders certainly may be a bit concerned so-"

JOURNALIST: "I mean, do we know anything about why he made this move? Was there any feeling of disgruntlement within the company? Is it a bit of a mess in there? What has he said?"

JOSH RAYMOND: "Well, obviously, I mean, if you look at the people who have been leaving lately, it's not been a good sign but the other thing is, and I'm just purely speculating of course, but if you look at the job that he's taken at Santander, I mean it really is one step away from becoming the CEO in the UK business and a lot of the rumors in the market is essentially that's where he's probably going to be ending up in the next 12 to 18 months or so. So maybe it's a short term, he needs to take the long term role at Santander of becoming the CEO of the UK side of the business. So, it makes sense on that side of it. It's still a big blow for RBS."

JOURNALIST: "All right, I want to finish up with a quick word on what we started with this, this budget deal in the U.S. A good first step, beginning of a new era but surely this marks the end of any chance of Washington enacting any major deficit reduction laws in the near future."

JOSH RAYMOND: "It does, and to be honest with you, it's good because they've come to an agreement. First step is really the only way you can call it because it is just the first step. Call me a cynic, I still think we'll still have a lot of troubles over the next year, next two years. Whenever Republicans and Democrats come together to come to an agreement about anything, there will always be struggles to get to a bipartisan agreement. It's a good first step. It doesn't cover everything. People are still going to be disgruntled on this basis so I think it's okay but I don't think that we should be celebrating this to the Hills at the moment."