Tue, Jan 13, 2015 - Page 15 News List

RBS planning Asian corporate banking sale


Clients exit a branch of Coutts private bank, a unit of Royal Bank of Scotland Group PLC, on The Strand in London on Jan. 5. Royal Bank of Scotland said in a memo in August last year that it was examining options, including a sale of Coutts’ overseas business, as it shifts its focus to wealthy clients in the UK. However, the lender is not selling the UK arm of Coutts, which counts Queen Elizabeth II among its customers.

Photo: Bloomberg

Royal Bank of Scotland Group PLC (RBS) is looking to put most of its Asian corporate banking business up for sale, according to a person with knowledge of the discussions.

RBS chief executive officer Ross McEwan, 57, was scheduled to hold a series of meetings in Singapore yesterday to consider ways to scale back the lender’s Asian business, said the person, who asked not to be identified because the meetings are private. A spokesman for RBS in London declined to comment. The lender said last month that it was shutting its Japanese trading business.

Since taking over in 2013, McEwan has been selling units and cutting jobs outside of the UK as he seeks to focus on the bank’s domestic market to help reverse six straight annual losses. RBS took bids for its Coutts International private bank last month and raised US$3 billion in September last year by selling shares in its US subsidiary, Citizens Financial Group Inc.

The bank has about 2,000 employees in the Asia-Pacific region that could be affected, said the person with knowledge of the matter. RBS would probably keep some operations in Singapore, offering clients dollar, euro and yen fixed-income products, the person added.

Any buyer wanting to purchase RBS assets across the region would need to hold an Indian banking license, the person said. Another option being discussed is selling assets by country. No comment was immediately available yesterday from an RBS spokesman in Hong Kong.

RBS’s corporate and institutional banking division is led in the Asia-Pacific region by Pierre Ferland, who is responsible for a 10-country network offering clients foreign exchange, interest rates, fixed income, debt capital markets and transaction services, according to the lender’s Web site.

The 80 percent taxpayer-owned lender is selling assets outside of the UK to help boost capital, as McEwan plans to return RBS to full private ownership. The bank last year dismissed most of its team overseeing debt capital markets in central and eastern Europe, the Middle East and Africa, amid a review of operations outside the UK.

RBS had £27 billion (US$40.8 billion) of credit risk assets in the Asia-Pacific region at the end of June last year, out of £551.6 billion of assets globally, according to the most recent data made available by the bank in quarterly earnings reports.

McEwan said in February last year that he wants RBS to increase its UK assets from 60 percent to 80 percent of its global business, as part of his plan to shrink in scale while boosting profitability. The bank had £302.8 billion of UK credit risk assets, or 55 percent of the total, at the end of June last year. North America was the next-biggest region with £101.3 billion.

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