ANALYSTS at Investec have upgraded Royal Bank of Scotland to "buy" after a recent fall in its share price.
Investec banking specialist Ian Gordon said the 82% state-owned bank's lowly rating offers "both value and downside protection" to investors.
Investec downgraded RBS to "hold" on February 20.
It has since been the worst-performing UK bank stock, Mr Gordon said, as it was hit by a wave of downgrades by brokers concerned that it will make another loss this year.
RBS is also struggling to detach itself from the financial crisis.
As The Herald revealed earlier this week, it faces a potential £3 billion claim from 7400 investors who allege they were misled over a £12bn fundraising months before RBS collapsed in 2008.
Mr Gordon said that after a retreat in RBS's share price, which fell from a high of 28.72p on February 23 on the day of its annual results announcement to a low of 25.37p earlier this week, "the investment case is not overwhelming, but it is now adequate".
Yesterday it rose 1.51p, or 5.7%, to close at 27.98p.
Investec has retained its 30p target price for the stock.
This figure is well shy of the break-even level of around 50p which is needed for the taxpayer to get back the £45bn invested in the state funded bail-out.
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