RBS abandon plans to sell Williams & Glyn
The Royal Bank of Scotland (RBS) has abandoned plans to sell Williams & Glyn following an alternative plan proposed by the Treasury.
RBS confirmed it will seek formal amendments to its state aid commitments to pave the way for this new proposal which will replace the need to sell Williams & Glyn.
This proposal would require the bank to deliver a series of initiatives worth an estimated £750m to boost competition in the UK business banking market.
Ross McEwan, chief executive of RBS, said this proposal would provide a quicker solution to its state aid obligations than the complex sale of Williams & Glyn.
The plan would aim to deliver the following remedies to promote competition in the market for banking services to SMEs in the UK:
- A fund, administered by an independent body, that eligible challenger banks can access to increase their business banking capabilities;
- Funding for eligible challenger banks to help them incentivise SMEs to switch their accounts from RBS, paid in the form of “dowries” to eligible challenger banks;
- RBS granting business customers of eligible challenger banks access to its branch network for cash and cheque handling, to support the measures above;
- An independent fund to invest in fintech to support the business banking of the future.
The bank said it will assess the timing and manner in which it will reincorporate Williams & Glyn into the RBS franchises following the proposed plans being finalised.
It added: “This reintegration would likely create some additional restructuring charges during 2017 and 2018.”