THE Royal Bank of Scotland would consider moving its headquarters from Edinburgh after independence if it encountered changes that harmed its business, Sir Philip Hampton told peers yesterday.
Giving evidence to the House of Lords economic affairs committee, the RBS chairman said both the UK and Scottish Governments needed to “give clarity” on what would happen should Scotland leave the UK.
He went on to say that the bank would have to reconsider its 300-year connection with Scotland and seek an alternative base if difficulties arose that harmed the institution post-
“The overriding requirement is to serve our customers and to produce the best value we can for shareholders.
“We have no intention or plan to relocate from Scotland,” he told peers. However, he added: “If as a result of independence we found extra difficulties or cost pressures or whatever arising from that, then we would have to think about other alternatives.”
He told peers that while there were no plans to move the bank’s headquarters from Edinburgh, just three to four per cent of the RBS group’s customers are based in Scotland.
Sir Philip said that RBS was currently “happy to be domiciled in Edinburgh”, which was “a good place to do business”.
He said that at the moment there was “no clear rationale” for the bank to move, although he later added that corporation tax levels could make a difference.
Sir Philip also told the committee that “small countries don’t often have big banks”. But he said while international money markets were concerned by the issue of a lender of last resort, RBS had received support during the banking crisis from foreign governments, including $90 billions from the Federal Reserve in the US.
He said that RBS, along with other banks, was currently “trying to break the sovereign” link which would mean the question of the lender of last resort would no longer be an issue.
He also touched on the issue that RBS is 82% owned by the taxpayer and said it was unlikely this would change by the time of the referendum.
However, he told members of the Lords that the division of RBS would have to be part of the discussions between the Scottish and UK governments, along with other taxpayer assets should there be a vote for independence.
Meanwhile, claims made by the SNP that independence would significantly boost growth were also dismissed by one of RBS’s senior executives.
Stephen Boyle, the head of group economic affairs for RBS, said that independence or staying in the Union would make little difference and would be “economically neutral”.
He told peers that for the size of Scotland’s public sector to make a significant difference it would “need to be nearer the size of North Korea’s” instead of the 2% difference it currently has with the UK.