George Osborne: 'RBS will now be easier to sell'

The Chancellor George Osborne has backed the decision to create an internal "bad bank" at Royal Bank of Scotland, rather than breaking the business in two, as it tries to recover from the financial crisis.

There have been calls for the bank - which is 81%-owned by the taxpayer - to separate its most high-risk assets from the core retail business.

Mr Osborne said that RBS will "eventually" return to the private sector and make a profit for the taxpayer, but that is "still some way off".

He also told the Today programme's John Humphrys that he endorsed the new strategy set-out by the bank's chief executive Ross McEwan: "I think it does make it easier to sell off the bank and get our money back."

He added that a sell-off was unlikely to begin before the next election in 2015.

First broadcast on BBC Radio 4's Today programme on Friday 1 November 2013.