I am still mystified by this bank “rescue”. RBS’s interims (Jun 30) showed they had zillions in book net worth, way above their market value. The FSA have told the banks that they must have 9% Tier 1 capital – 4% used to be enough with another 4% Tier II generally being acceptable. Barclays say that with their rights issue they will be over 11%. That sounds like a lot even before a recession. So what is going on? Why is there a need for a bail out? Does the market know that their are undisclosed losses in their banking book (which is not required to be marked to market like their trading book)? Were they stitched up by the government or is there more bad news on the way?