Chancellor Philip Hammond has brushed off criticism of the sale of RBS shares

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But Chancellor Philip Hammond has brushed aside the criticism, reiterating his belief that the Government “should not be in the business of owning banks”.

Following the global financial crisis of 2008, the Government unveiled a package of measures aimed at stabilising the situation by which mechanism it purchased shares in various banks, including RBS.

According to yesterday’s announcement, almost eight per cent of the shares currently owned by the Government have been sold off at a price of 271p each, generating £2.5billion.

However, this means the taxpayer is left nursing a loss of £2.1billion, which allied to a losses from a previous sell-off of shares in 2015, means the total deficit so far is £4billion.

Labour's Jonathan Reynolds questioned the timing of the move

Whitehall sources have told Express.co.uk the decision amounting the Government “cutting its losses”, given that it was unrealistic to try and sell the shares at 502p – the amount they were valued at prior to the financial crash ten years ago – in the near future.

The Government has calculated that it would need to sell shares off at 700p a share to break even – a possibility which seems increasingly remote.

The move means the Government has reduced its stake in the bank from just over 70 percent to 62.4 percent.

Mr Hammond said: “This sale represents a significant step in returning RBS to full private ownership and putting the financial crisis behind us.

RBS chief executive Ross McEwan welcomed the move

The government should not be in the business of owning banks Chancellor Philip Hammond

“The government should not be in the business of owning banks. The proceeds of this sale will go towards reducing our national debt.

“This is the right thing to do for taxpayers as we build an economy that is fit for the future.” The move was blasted by Labour’s shadow city minister, Jonathan Reynolds who said: “Why did the Treasury sell RBS shares when the bank’s fundamentals are finally improving after the US fine settlement?

“Taxpayers, as major shareholders, deserve to know.”