Royal Bank of Scotland

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The Royal Bank of Scotland Group PLC is one of Scotland's three national clearing banks and one of the oldest in the UK, founded in Edinburgh in 1727 by Royal Charter.

Today it is the largest bank in Scotland, the second largest in the UK and Europe, and the fifth largest in the world by market capitalisation being worth over £50Bn. Its shares have a primary listing on the London Stock Exchange.

The bank's registered head office is located at St Andrew's Square in Edinburgh. In 2005, Queen Elizabeth II opened the bank's new head office building in Gogarburn, Edinburgh. It has offices throughout Europe, America and Asia.

Contents

1 History of the Royal Bank of Scotland
2 Constituents of the Royal Bank of Scotland Group
3 Other facts
4 See also
5 External links
6 Data

History of the Royal Bank of Scotland

The bank traces its origin to the Equivalent Society which was set up by investors in the failed Company of Scotland to protect the compensation they received as part of the arrangements of the 1707 Acts of Union. The Equivalent Society became the Equivalent Company in 1724, and the new company wished to move into banking. The British government received the request favourably as the "Old Bank", the Bank of Scotland, was suspected of having Jacobite sympathies. Accordingly the "New Bank" was chartered in 1727 as the Royal Bank of Scotland.

Competition between the Old and New Banks was fierce, and centred on the issue of banknotes. The policy of the Royal Bank was to either drive the Bank of Scotland out of business or to take it over on favourable terms.

The Royal Bank built up large holdings of the Bank of Scotland's notes, which it acquired in exchange for its own notes, and then suddenly presented them to the Bank of Scotland for payment. To pay for these notes the Bank of Scotland was forced to call in its loans and, in March 1728, to suspend payments. The suspension relieved the immediate pressure on the Bank of Scotland at the cost of substantial damage to its reputation, and gave the Royal Bank a clear space to expand its own business, although the Royal Banks' increased note issue also made it more vulnerable to the same tactics.

Despite talk of a merger with the Bank of Scotland, the Royal Bank did not possess the wherewithall to complete the deal. By September 1728 the Bank of Scotland was able to start redeeming its notes again, with interest, and in March 1729 it restarted lending. To prevent similar attacks in the future, the Bank of Scotland put an "option clause" on its notes, giving it the right to make the notes interest-bearing while delaying payment for six months; the Royal Bank followed suit. Both banks eventually decided that the policy they had followed was mutually self-destructive and a truce was arranged, but it still took until 1751 before the two banks agreed to accept each other's notes.

1727- founded in Edinburgh by Royal Charter
1783- first branch in Glasgow opens
1874- first London branch opens
1920- acquisition of various small English banks to form Williams Deacons Bank, later combined with Glyn Mills & Co. to form Williams and Glyn's Bank
1972- merger with National Commercial Bank of Scotland
1980- abortive hostile takeover bid by Hong Kong and Shanghai Banking Corporation fails
1985- established the Direct Line insurance brand
1985- Williams and Glyn's bank name merged with the Royal Bank of Scotland
1988- acquisition of Citizens Financial Group of Rhode Island
1997- Registrars department acquired by Australian share registry company Computershare
1997- develops internet banking
2000- acquisition of the National Westminster Bank after hostile takeover battle with the Bank of Scotland
2004 - acquisition of Peoples Credit Card Services, USA

Constituents of the Royal Bank of Scotland Group

Royal Bank of Scotland- Scottish clearing bank, head office in Edinburgh
NatWest - UK clearing bank, head office in London
Ulster Bank - Belfast-based bank with branches throughout Ireland, prints banknotes for Northern Ireland
Lombard Direct - Loans and Insurance service provide in the UK
Adam and Company - UK private bank
Bibit - Payment Service Provider based in The Netherlands
Citizens Financial Group - U.S. bank group based in New England
Coutts & Co - UK private bank based in London
Direct Line - telephone financial services company
[Greenwich Capital Markets] a bond broker and primary dealer in the U.S.
National City Brokers - a Dublin, Ireland stockbrokers
WorldPay - specialised in Internet Business
Streamline - merchant services - provides business with the facilities to accept credit and debit card payments
First Active - Fixed and Variable interest rate mortgages, online applications
Churchill Insurance - UK insurance business, includes UKI an insurance business that underwrites policies for other financial services companies and own brand business.
Royal Bank of Scotland operates a joint venture with Tesco, Tesco Personal Finance
Angel Trains, one of the three rolling stock leasing companies in the United Kingdom
Now owns the 47 Marriott hotels in the UK, after they were sold by Whitbread.
The One account - internet-based offset product: Current Account Mortgages (CAM); life, home and loan insurance.

In August 2005 Royal Bank of Scotland purchased a 5% stake in the Bank of China.

Other facts

£100 banknotes of the Royal Bank of Scotland

The Royal Bank of Scotland, along with Clydesdale Bank and Bank of Scotland, still prints its own banknotes for Scotland
It is the only UK bank that still prints a 1 pound note
It was the first bank in the world to offer an overdraft facility
In June 1997, The Royal Bank of Scotland became the first high street bank in the UK to introduce an Internet banking service.

External links

[The Royal Bank of Scotland Group official site]
[RBS Company Announcements]
[BBC News headline reporting a £21m theft at the RBS by one of the Banks managers -Donald Mackenzie]

Data

[Yahoo! - The Royal Bank of Scotland Group plc Company Profile]

Royal Bank of Scotland Group

Annual Group Revenue: £20.9 billion GBP ( 11.8% FY 2004) | Employees: 140,400 | Stock Symbol: LSE: [RBS] | Website: [www.rbs.com]