Royal Bank of Scotland's restructuring of its investment bank was one of the City's worst-kept secrets. Not only had the 83% state-owned UK banking giant said a review was under way, but Chancellor George Osborne pre-announced the outcome in Parliament last month. The only surprise is that the overhaul isn't more radical.

In fact, the only business RBS is fully quitting is equities. The cash equities, equity capital markets and mergers-and-acquisitions units-legacies of the ill-fated 2007 acquisition of ABN Amro-are currently loss-making and will be closed or sold. Yet ironically, this business is one of the least capital intensive and so one of the least affected by the new Basel III capital rules that were the main catalyst for the restructuring.