Buyers line up for RBS branch sell-off

Published 10th Jan 2010

THE Royal Bank of Scotland has fired the starting pistol on the sale of more than 300 branches, giving potential bidders until the end of the month to express an interest.

Advisers at UBS, the investment bank, have been appointed to handle the disposal of the branches, which are being sold with the brand name Williams & Glyn’s.

The sale has been accelerated because of a flood of interest from potential bidders, and comes as the battle for control of British retail banking heats up.

Sandy Chen, banking analyst at Panmure Gordon, the stockbroker, will tomorrow start fundraising for a new retail bank. Also, Virgin Money announced last week that it had bought Church House Trust, a tiny bank in Somerset.

Church House has only 3,000 customers but the acquisition will allow Virgin to acquire a banking licence, speeding up its expansion plans.

Tesco has also expanded its banking presence and is opening branches in a number of its stores across the country.

A teaser document, detailing the branches included in the RBS sale, has been circulated. Potential bidders include National Australia Bank, owner of Clydesdale and Yorkshire banks in the UK, and Santander, the Spanish banking giant.

RBS was ordered to sell more than 300 branches by the European Commission as part of the penalty for receiving aid from the UK government. It has also been ordered to sell RBS Sempra, its commodities business, its global merchant payments operation and its insurance business, which includes the Churchill and Direct Line brands.

Chen is looking to raise about £200m for his new bank, to be named Walton & Co. He has hired two former HSBC executives, Peter Simpson and David Hollely, to help run it. They were influential in setting up First Direct, HSBC’s retail banking operation. Sir Peter Middleton, former chairman of Barclays, is a special adviser to the bank.

Chen is believed to be planning to open his first two branches in market towns in southeast England early next year. His target customers are understood to be small businesses and families with more than £45,000 in liquid assets.

Source: ' Times '

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