Broker snap: RBS expected to manage Irish exposure

23rd Nov 2010 13:10

UBS thinks risk aversion has seen the shares of the Royal Bank of Scotland (RBS) underperform, but reckons the market might have overreacted to the bank's exposure to the Irish crisis.With worried investors shying away from many banks that have exposure to Ireland, RBS shares have taken a hit over these concerns. However, the broker says that RBS's £50bn of Irish exposure is "manageable".Though it will be some time before the benefits of restructuring become evident and the group is able to reduce dependence on the support mechanisms put in place in 2009, the stock is attractive at current values, the broker says.RBS is lifted to a 'buy' from 'neutral', despite the broker cutting the target price to 47.5p from a prior 56p.