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RBS to strengthen NatWest brand RBS to strengthen NatWest brand
(about 3 hours later)
Royal Bank of Scotland is giving more prominence to NatWest, the bank it bought more than 15 years ago, in a move that further signals its break from the Fred Goodwin era.Royal Bank of Scotland is giving more prominence to NatWest, the bank it bought more than 15 years ago, in a move that further signals its break from the Fred Goodwin era.
RBS is to rebrand its investment banking arm – already much diminished from Goodwin’s time – NatWest Markets, which itself had a troublesome history when it was part of the former NatWest group.RBS is to rebrand its investment banking arm – already much diminished from Goodwin’s time – NatWest Markets, which itself had a troublesome history when it was part of the former NatWest group.
The bailed out bank will also give more prominence to the NatWest brand in England and Wales for retail customers, although Scottish customers will continue to use Royal Bank of Scotland-branded branches. The bailed out bank will also give more prominence to the NatWest brand in England and Wales for retail customers, although Scottish customers will continue to use RBS-branded branches.
The changes are being announced by the 73% taxpayer-owned bank as it outlines how it will implement the ringfencing rules which were born out of the Vickers commission and intended to help avoid bailouts in the future. Under these ring fencing rules, high street operations must be ringfenced from the potentially more risky investment banking arms. The changes are being announced by the 73% taxpayer-owned bank as it outlines how it will implement the ringfencing rules which were born out of the Vickers commission and intended to help avoid bailouts in the future. Under these rules, high street operations must be ringfenced from the potentially more risky investment banking arms.
This requires a complex legal restructuring under which all the retail banking customers will be held under a holding company called NatWest Holdings Limited – a move that puts more emphasis on the name of the bank that RBS took over in February 2000 after a hostile bid. This requires a complex legal restructuring under which all the retail banking customers will be held under a holding company called NatWest Holdings Ltd – a move that puts more emphasis on the name of the bank that RBS took over in February 2000 after a hostile bid.
NatWest Holdings will house high street customers of NatWest, RBS, Ulster Bank and its brands for wealthier customers such as Coutts, Drummonds, Holt’s and Adam & Co. NatWest Holdings will house high street customers of NatWest, RBS, Ulster Bank and its brands for wealthier customers such as Coutts, Drummonds, Holt’s and Adams & Co.
In a further complication, the banking licence for Adams & Co will technically be the one used for retail customers of RBS. Under the current structure, RBS retail and investment banking customers are all handled through the same entity.The use of Adams & Co means customers will not have to be handed new sort codes. In a further complication, the banking licence for Adams & Co will technically be the one used for retail customers of RBS. Under the current structure, RBS retail and investment banking customers are all handled through the same entity. The use of Adams & Co means customers will not have to be handed new sort codes.
The announcement that RBS is pressing on with the ring fence – which must be completed by the start of 2019 – comes amid turbulence in financial markets sparked by fears about the ability of Deutsche Bank to pay a a $14bn (£11bn) penalty from the US regulators. It is evoking memories of the crisis that hit the markets eight years when Lehman Brothers collapsed and eventually led, in October 2008, to a bailout for RBS. The announcement that RBS is pressing on with the ring fence – which must be completed by the start of 2019 – comes amid turbulence in financial markets sparked by fears about the ability of Deutsche Bank to pay a a $14bn (£11bn) penalty from US regulators. It is evoking memories of the crisis that hit the markets eight years ago when Lehman Brothers collapsed and eventually led, in October 2008, to a bailout for RBS.
It also comes as Ross McEwan, the RBS chief executive, begins his fourth year running a bank that has incurred £52bn of losses since taxpayers pumped in £45bn to keep it afloat.It also comes as Ross McEwan, the RBS chief executive, begins his fourth year running a bank that has incurred £52bn of losses since taxpayers pumped in £45bn to keep it afloat.
“The future ring-fenced structure of the bank is not only designed to be in compliance with the new regulatory requirements and objectives but will better reflect who we are as a bank and what we stand for: a bank that is focused on its customers,” said McEwan. “The future ringfenced structure of the bank is not only designed to be in compliance with the new regulatory requirements and objectives but will better reflect who we are as a bank and what we stand for: a bank that is focused on its customers,” said McEwan.
“Our proposed future structure under the ring-fencing legislation and our brand strategy are key elements of the bank we are becoming.”“Our proposed future structure under the ring-fencing legislation and our brand strategy are key elements of the bank we are becoming.”
Last week, RBS began a new advertising campaign which signalled that the NatWest brand would be given more prominence in England and Wales and set out that in Scotland it would be known as “The Royal Bank”.Last week, RBS began a new advertising campaign which signalled that the NatWest brand would be given more prominence in England and Wales and set out that in Scotland it would be known as “The Royal Bank”.
The situation has been complicated by the failure of RBS to sell off the 300 branches it was required to by the EU as a penalty for state aid. These Williams & Glyn branches are supposed to be sold by the end of next year although McEwan warned this week that the bank faced unchartered territory if it failed to do so.The situation has been complicated by the failure of RBS to sell off the 300 branches it was required to by the EU as a penalty for state aid. These Williams & Glyn branches are supposed to be sold by the end of next year although McEwan warned this week that the bank faced unchartered territory if it failed to do so.