William Wallace would not be happy.  Shares of the Royal Bank of Scotland lost almost exactly two-thirds of their value today after the company warned that it might report the biggest ever yearly loss in UK corporate history.

Here’s how RBS, as it’s known, was brought to its knees.  Simon Kennedy writes, “Like other U.K. banks, RBS has been hit hard by write-downs on risky assets, the virtual closure of wholesale lending markets and rising charges to cover customers who can’t keep up their loan repayments.”

Then, “the bank’s woes have been made even worse by its acquisition of Dutch group ABN Amro, which added billions of risky assets to its balance sheet just as markets were peaking in late 2007.”

And we’re not out of the woods yet, of course, which is sure to make shareholders even more nervous.  The full nationalization of RBS is being treated as a distinct possibility.

RBS is at least following government directives to ease lending standards, however, which could win it some goodwill in both the short and long term.  Some personnel changes are also underway that could make onlookers feel better about the situation.