RBS weighs up sale of international arm of private bank for €750m

Royal Bank of Scotland has confirmed it is considering selling the international arm of its private bank, a deal one source said could net it as much as $1bn (€747m) as the British government leans on it to focus more on domestic lending.

The move means that Coutts, founded in the 18th century and best known as banker to the Queen of England, could be split into two businesses — one based in Britain and one in Zurich from where it runs operations in Hong Kong, Singapore, Abu Dhabi, and Dubai that manage nearly $36bn in client assets.

RBS has attracted a variety of offers from a range of bidders including unnamed Asian and North American parties for Coutts International, two sources said.

The sale could net RBS between $720m and $1.1bn, based on a multiple of 2%-3% of assets under management, said a third source.

The bank yesterday told staff it was exploring a sale, confirming an earlier report by Reuters.

“We will... work with local management teams to explore options including merging the remainder of the current Coutts International business, considering joint ventures or a sale, thereby reducing RBS’s footprint internationally,” executives Alison Rose and Les Matheson wrote in a memorandum.

RBS is 81% owned by the British government, following a £45bn (€56bn) bailout and is now under pressure to focus on loans to UK households and businesses and help support the country’s economic recovery.

It has undergone a major restructuring in order to pay back taxpayers’ funds and eventually return to private ownership.

As part of the RBS overhaul, Coutts’ international unit, which employs 1,200 staff, has dramatically cut the number of countries it serves.

— Reuters