One of the largest shareholders in Royal Bank of Scotland and HBOS yesterday signalled that it might be willing to add to its stakes in both banks after they agreed a £31.5bn capital injection from the government.

Standard Life signalled that the banks’ valuations were looking compelling after the recapitalisation, though it still had questions about the role the government would be likely to play.

Standard Life made its pledge as ministers and bank executives debate the conditions attached to the government’s proposed bailout. In particular, executives and investors have expressed concern that banks could be banned from paying dividends to ordinary shareholders.

Financial Times