INSTANT VIEW - UK banks in govt funding talks

LONDON (Reuters) - British banks are talking to the government about the possibility of an injection of public money, news that sent bank shares down sharply on Tuesday as investors anticipated a dilution of their holdings.

Royal Bank of Scotland was the biggest loser, with its shares down as much 39 percent to a 15-year low at 90 pence.

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ANALYST COMMENT

ADAM STEINER, HEAD OF RESEARCH, SVG INVESTMENT MANAGERS

"What's clear is that it's a very interesting time to be making an investment decision because either these companies are heading for semi-nationalisation or you're going to make fantastic money.

"And historically in banking crises, if you look at the Asian crises as examples, or the last one in the UK, if you get the timing right, you can do well as an investor.

"So it's definitely a time for the brave, and the difference between being brave and foolhardy is sometimes slim."

NIGEL MYER, BANKING CREDIT ANALYST, DRESDNER KLEINWORT