Royal Bank of Scotland Plc, the second largest U.K. bank, unveiled a plan on Tuesday to raise 12 billion pounds ($24 billion) in capital to boost its balance sheet by selling shares to investors after a reporting a 5.9 billion pound writedown.

The rights issue by the bank, which has been battered by the downturn in the housing and credit markets, is the largest in the history of British banking.

The RBS plan comes after other major banks are already taking a similar path to replenish their capital.

RBS said it would sell assets worth 4 billion pounds as well. It is considering selling its insurance business which contains the Direct Line and Churchill brands, Goodwin to reporters in a conference call.

The company also took a 5.9 billion pound writedown related to poorly performing credit markets.

According to the terms of the plan, RBS will offer 11 new shares for every 18 existing shares at 200 pence pence, a 46.3 percent discount to the stock's closing price yesterday.

Shares of RBS closed down 3.9 percent in London. American depositary shares in New York were down 4.28 percent in early afternoon trading.

Chief Executive Fred Goodwin had previously denied the need to raise capital.

The new funds will raise the bank's Tier 1 capital - - a measure of the bank's ability to sustain losses - - to 6 percent from the current 4.5 percent. Regulators require at least 6 percent in Tier 1 capital to qualify a bank as well-capitalized.

RBS said it would pay investors the year's interim dividend in shares, not cash. The bank expects to pay cash for the year's final dividend.

It will seek a shareholder vote in May to approve the stock sale.

United kingdom