RBS Chief Issues Green Shoots 'Warning'

The CE of RBS said yesterday that the economy had 'turned a corner', but the full impact of laons secured on property and their looses could take years to untangle.

"The world has turned a very important corner' he said 'and we have moved from an extraordinary case of fear of unprecendented meltdown to a conventional recession. The banking system can support demand for credit but demand for credit should be falling. Borrowers have to save more and borrow less."

His remarks coincided with a report that the number of residential property's repossessed will continue to rise for the next two years. High frequency Economics, a consultancy, said that upto 120,000 people will lose their homes in 2011.

In an address to the British Property Federation , Lord Myners the City Minister has said that the recent levels of high borrowing were like a heavy night of drinking. "I am tea total, but if you have a heavy nights drinking, it takes a long time to recover. We've had a seriously heavy night of drinking."