RBS close to offloading toxic property loans -paper

LONDON, June 26 Sun Jun 26, 2011 10:25am EDT

LONDON, June 26 (Reuters) - Royal Bank of Scotland is close to reaching a deal to offload 1.6 billion pounds ($2.6 billion) of toxic property loans, The Sunday Times said in an unsourced report.

The report added RBS would join with either Blackstone or Lone Star private equity firms to manage the portfolio.

A spokeswoman for RBS declined to comment on the report.

RBS, 83 percent by the British government after a state bailout during the credit crisis, has sold portfolios of non-core property assets to bolster its balance sheet.

In March, it sold a 286 million euro($410 million) portfolio of Spanish real estate loans to Perella Weinberg. ($1 = 0.618 British Pounds) ($1 = 0.698 Euros) (Reporting by Sudip Kar-Gupta)