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RBS confirms London move if Scotland votes Yes

Rbs2

Royal Bank of Scotland has confirmed it will relocate to London if Scotland votes for independence next week.

The bank said in a statement that it believed it would be "necessary to re-domicile the bank’s holding company". RBS says it intended to keep a "significant level" of jobs north of the border. The bank has been based in Scotland since 1727.

Meanwhile Scotland’s largest fund manager’s boss said an independent Scotland would be a huge success. Martin Gilbert, chief executive of Aberdeen Asset Management said: "I think an independent Scotland would be a big success, but it is a secret ballot and I will abide by that.

"Most sensible people now accept that Scotland would be prosperous with either outcome in the current constitutional debate."

Companies are increasingly setting out their post-referendum contingency plans. Lloyds Banking Group said it could shift some of its business from Scotland. However, Lloyds said it was just a legal procedure and "there would be no immediate changes or issues".

The statement from Lloyds said: "Lloyds Banking Group has seen an increased level of enquiries from our customers, colleagues and other stakeholders about our plans post the Scottish referendum. When a company like Standard Life says that it would have to relocate its business to London that is not some sort of decision that they make lightly.”

"While the scale of potential change is currently unclear, we have contingency plans in place which include the establishment of new legal entities in England. This is a legal procedure and there would be no immediate changes or issues which could affect our business or our customers."

"There will be a period between the referendum and the implementation of separation, should a Yes vote be successful, that we believe is sufficient to take any necessary action."

Lloyds, in which the UK government has a 25% stake, owns Bank of Scotland and Halifax.

Jobs

The move of what Lloyds describes as "legal entities" indicates that the banking group is not suggesting there will be a mass relocation of its 16,000 Scottish-based staff. The move would simply mean that the bank would remain protected and regulated by the Bank of England.

RBS employs 11,500 people in Scotland.

Angus Grossart, chairman of merchant bank Noble Grossart, said that people should "not panic" following the decisions made by the two banks. He told the Financial Times that the impact of a Yes vote was "severely overstated".

BBC economics editor Robert Peston said that that if RBS, 81%-owned by the UK government, moved its head office and registered office to London it "would involve some jobs moving south".

However, he said the situation with Lloyds was different: "Lloyds would move its legal home to its head office, which is already in London – and that’s unlikely to have much impact on Scottish employment."

A Treasury source told the BBC that it had discussed the plans with RBS.

‘Overreaction’

On Wednesday, insurance giant and pensions giant Standard Life said it was "planning for new regulated companies in England to which we could transfer parts of our business if there was a need to do so".

Treasury Chief Secretary Danny Alexander told BBC2′s Newsnight: "When a company like Standard Life says that it would, unfortunately, sadly, have to relocate its business to London that is not some sort of decision that they make lightly.

"They make it on the basis that they regard that as the best way to protect their customers under the new circumstances.

"When we hear Lloyds and other banks making clear that they would have to do the same, again that is not something that they say lightly. They say it having thought about it, having talked to their board and to the senior people in those companies."

First Minister Alex Salmond has described reports of banks moving out of Scotland as "nonsense" and "scaremongering".

And Mr Grossart, one of the most senior figures in Scotland’s financial establishment, said people were "overreacting" to the threats of exodus of firms.

"I think it is getting out of hand," he told the Financial Times. "To hear some of the comments you almost expect people to be predicting a plague of locusts or mice next."

(Source: BBC)