Nils Pratley’s piece at the Guardian on RBS and Lloyds is very good.  Two quotes sum up the situation quite well.
First, in regards to Lloyds, Pratley says:
Royal Bank of Scotland’s shares down almost 20% in two days; Lloyds’s shares an oasis of tranquillity. Those market reactions tell the story of the banking bailout part 3, [...]

If our response focuses only on the symptoms rather than the underlying causes of the crisis, then we shall bequeath to future generations a serious risk of another crisis even worse than the one we have experienced.
-Mervyn King, Governor of the Bank of England

The Bank of England head has come out unequivocally against continuing with [...]

This comes via the Telegraph:
UK Financial Investments (UKFI) said in its annual report that its loss on the two stakes – 70pc of RBS and 43pc of Lloyds Banking Group – had reached £10.9bn at the end of June.
The losses, which are not yet realised, have been wracked up since Gordon Brown was forced to [...]