Standard likely to take on 'non-core' RBS Asian assets

Published on Friday 31 July 2009 21:45

ROYAL Bank of Scotland is on the brink of selling its retail and small and medium-sized business lending assets in India, China and Malaysia to Standard Chartered Bank for between $220 million-$250m (£132m-£150m).

One industry source said: "If there is agreement, as seems likely, this could be tied up within the next fortnight."

Standard Chartered, which has a strong Asian heritage, has long been regarded as a front-runner for some of RBS's Asian retail assets which new chief executive Stephen Hester has deemed as "non-core".

A Standard Chartered spokesman said: "We always look at opportunities in our footprint markets but, as you would expect, we don't comment on any specific opportunities."

An RBS spokesman said: "The sale process of the retail and commercial assets in Asia has advanced well. However … we will not comment on any individual bidders or elements of the transaction process until its completion."

It is understood Hester and RBS chairman, Sir Philip Hampton, had considered selling the whole Asian retail business to one bidder.

The bank also has a presence in Pakistan, Hong Kong, Singapore, Taiwan, Indonesia and Vietnam.

Four potential buyers are known to have thrown their hat in the ring for RBS Pakistan via regulatory announcements in that country.

City analysts said the sale of the Indian, Chinese and Malaysian business to Standard Chartered made sense.

Simon Willis at NCB Stockbrokers said: "It has credence. Standard has been relatively unscathed by the credit crisis and the bulk of its business is in Asia."

Keith Bowman at Hargreaves Lansdown said: "When Standard raised 1.8 billion in the market last year it suggested the money could be used for bolt-on acquisitions. These fit the bill.

"The City would not be fussed about a piecemeal sale of RBS's Asian assets. RBS may have decided it will make more money selling them piecemeal rather than if they sold them as a whole."