RBS confirms London move
September 11, 2014
In a statement released Thursday, Royal Bank of Scotland (RBS) said it would be necessary to "re-domicile the Bank's holding company and its primary rated operating entity to England" if Scotland votes in favor of independence.
RBS also said it intended to keep a "significant level" of jobs in Scotland under its contingency plan for dealing with possible business implications of a "Yes" vote.
"There are a number of material uncertainties arising from the Scottish referendum vote which could have a bearing on the Bank's credit ratings, and the fiscal, monetary, legal and regulatory landscape to which it is subject," RBS said in its statement.
RBS has been based in Scotland since its founding in 1727. The British government owns an 81 percent stake in the lender after a 45.5-billion-pound (57-billion-euro) bailout in the wake of the 2007 financial crisis.
Necessary safeguards
As Scotland prepares to hold a historic independence referendum on September 18, companies are setting out their post-referendum contingency plans.
Lloyds Banking Group has also announced moves to relocate key operations to England in the event that Scottish voters choose to take their country out of the United Kingdom. Lloyds, which is 25-percent owned by the British government, said its plans were just a "legal procedure" which wouldn't entail "immediate changes" affecting its business or customers in Scotland.
"While the scale of potential change is currently unclear, we have contingency plans in place which include the establishment of new legal entities in England," Lloyds said in a statement Thursday.
The announcement suggests that Lloyds doesn't intend to relocate sizeable numbers of the 16,000 staff it employs in Scotland, but will seek to remain protected and regulated by the UK's central bank, the Bank of England.
Bank of England Governor Mark Carney said Wednesday that Scotland would need big stockpiles of sterling if it wanted to stay solvent following a "Yes" vote, unless it strikes a currency agreement with London.
uhe/nz (Reuters, AFP)