RBS chief's costly PR failure

Embattled Royal Bank of Scotland chief executive Sir Fred Goodwin is paying the price for a lack of PR, according to a leading City analyst.

The bank is trying to raise £12bn through a rights issue - the biggest capital raising in British stock market history - after taking a big hit from the credit crunch.

But many shareholders are saying they will only back the plan if Goodwin goes.

Anthony Hilton, of London's Evening Standard, said the bank chief had made a lot of enemies in the City and that it was a situation crying out for reputation management.

Time should have been taken to repair Goodwin's relations with the City analysts, the commentator said, and to hold meaningful dialogue with the investing institutions.

He added that Goodwin could have been more constructive with the press - instead of seeing the relationship as a tap he could turn on when thirsty and otherwise not think about.

He said if shareholders only cough up more money in exchange for Goodwin going, it would be a high price to pay for refusing to indulge in a charm offensive.