RBS To Change Name To NatWest Group, Slash Investment Banking

 | Feb 17, 2020 09:18PM ET

With a view to give Royal Bank of Scotland (LON:RBS) (NYSE:RBS) a fresh start, new CEO Alison Rose is mulling to rename the bank as NatWest Group sometime later in 2020. Also, the bank seeks to shrink its investment banking business.

The government had rescued Royal Bank of Scotland from collapse at the time of financial crisis by paying £45.5 billion, which gave it 70.5% ownership in the bank. Also, the company was involved in a number of litigations, which resulted in huge fines. The bank undertook several restructuring moves and finally returned to profit in 2017.

The change in name is not expected to affect the products and services currently offered by the company. In fact, Rose is of opinion that 80% of the bank's customers are more familiar with the name NatWest. CEO also assured that the move will not affect jobs.

Chairman Howard Davies said, “As we outline our plans for the future and with our legacy issues behind us, the Board have agreed that it’s the right time to align the parent company name with the brand under which the large majority of our businesses delivered.”

Regarding investment banking business, RBS plans to refocus its activities to directly cater to its core customers. Also, NatWest Markets restructuring and disposal costs are expected to amount to £0.6 billion in 2020.

Our Take

We expect RBS’ diversified business model and sound financial position to be conducive to overall growth in the near term. Also, it remains committed to reducing costs to £250 million in 2020, and plans to continue to investing in innovations and partnerships to build revenue opportunities.

Shares of Royal Bank of Scotland have gained 21.2% over the past year compared with 6.5% growth recorded by the Zacks Investment Research

Get The News You Want
Read market moving news with a personalized feed of stocks you care about.
Get The App

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

Sign out
Are you sure you want to sign out?
NoYes
CancelYes
Saving Changes