RBS agrees £1.65bn branch sale to Santander

Published 04th Aug 2010

The Royal Bank of Scotland has agreed to sell 318 branches and other assets to Spanish bank Santander for £1.65bn at at a premium of £350m to net asset value.

The sale comprises 311 RBS branches and seven NatWest branches.

It also includes:

* Businesses serving 1.8 million retail customers (2% retail market share), 244,000 SME customers (5% SME market share) and 1,200 mid-corporate customers (5% market share).
* 40 SME centres and four corporate centres.
* 3 private banking centres which predominantly serve RBS customers who transfer with the sale.

Santander UK is paying cash for the assets and the deal is expected to be completed by December 2011. RBS said the implied equity of the business being sold is £1.3bn.

Stephen Hester, RBS chief executive, said: “This is an important milestone in our restructuring work and complements the significant momentum behind our recovery plan overall.

“The bank is becoming stronger, which allows an increased focus on serving ongoing customers and improving commercial success; all a pre-requisite for the profitable realisation of taxpayers’ stake in RBS.

“I am pleased that by reaching the sale agreement early we can provide customers and staff with greater clarity on their future. Santander will be a good owner of these assets. The divestment will make them a stronger competitor in UK banking, especially in the SME and mid-corporate sectors.

“The separation and transfer process will take 12-18 months to complete and throughout this period we are committed to maintaining good standards of customer service and making the transfer to new ownership as seamless as possible. But for now, customers will not experience any change”.

Source: ' Property Week '

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