No...
The debts still exist, the government did not pay them off, they took an investment in the bank(s) to ensure that they had the liquidity to maintain payments on these debts whilst they were restructured, and to give the market back the confidence to lend the banks money at less dislocated rates.

Remember, all that money that the government has put in is either a) due to be paid back, b) pays a significant dividend (see above) or c) can be sold by the government to the private sector at any time on the open market. Potentially for a huge profit - if the banks become successful again.
( The Teviot Moose major 5th., Mon 14 Jun 2010, 12:33, 1 reply)

That would be the politicians profiting from it, then.
Oh yes.

What was it I was saying about the bankers paying off politicians?

Silly me!
( Je suis un vagabond is an unfunny, up your own arse middle class knob, Mon 14 Jun 2010, 12:36, closed)

Do you think that the government's holdings in RBS and Lloyds are actually owned by your MP?
They are owned by the State. The UK Treasury - en.wikipedia.org/wiki/UK_Financial_Investments_Limited

In fact, if you're so inclined, you can get a job with them : www.ukfi.co.uk/job-opportunities/

Edit : If you're interested, the price at which the government make a profit on their investments are 63.2p per share in Lloyds, and 49.9p per share in RBS. Both banks have been over this price in the past year.
( The Teviot Moose major 5th., Mon 14 Jun 2010, 12:43, closed)