'Royal Mile shows will go on' as time runs out on RBS sponsorship

• RBS's Fringe backing is worth 100,000 a year – it provides bins,poster towers and stages for the High Street Picture: Ian Rutherford

Kath Mainland, chief executive of the Festival, has admitted no deal is in place for the street theatre areas on the High Street for next year.

The news has emerged just weeks after the Edinburgh International Festival admitted it was looking for a sponsor for its fireworks finale after the withdrawal of Bank of Scotland's backing.

RBS has renewed sponsorship deals with the Royal Highland Show and the Edinburgh Military Tattoo, which were due to expire this summer, but has refused to commit to the Fringe after the Festival finishes on Monday.

Festival officials insist negotiations are still continuing with RBS, which has confirmed it is "reviewing" its sponsorship of the Fringe, but a final decision has not been taken.

However, Festival insiders have admitted a hunt for a new headline sponsor for the High Street – which was first closed off to accommodate street entertainers and revellers in 1997 – is well under way.

RBS has been one of the Fringe's main backers for the past ten years and its support is understood to be worth around 100,000 a year as the firm provides a host of infrastructure on the High Street, including performance stages, poster towers and waste bins.

However, its backing for the Fringe has been criticised by climate-change campaigners who claim it is a PR tactic to mask controversial projects it is funding around the world.

Fringe officials refused to speculate about the fate of the High Street arena if no sponsor is found for next year, insisting it was confident one would be in place in time.

• Winners and losers after bail-out

The Fringe was forced to find another major backer for this year's event after cider firm Magners withdrew its backing, but unveiled a three-year deal with Edinburgh-based Caledonian Brewery for its leading "Deuchars" brand just weeks before its programme launch.

The Fringe Sunday showcase – previously backed by the Bank of Scotland – has already had to be shelved because of a lack of finance, while the Festival's annual opening party has also been scrapped in recent years.

Ms Mainland said: "The current arrangement with RBS runs out next month and there is nothing in place for next year at the moment. Discussions are ongoing with RBS and a final decision hasn't been made yet."

One source close to the Fringe said: "It's fairly widely known that RBS wanted to walk away being a headline sponsor with the Fringe. The Festival was warned some time ago that the current deal would not be renewed, although it is still hoping the bank will be persuaded to put some money on the table."

A study for the city council warned last year that the city's festivals were likely to face a mounting financial crisis because of squeezes in public funding and dwindling sponsorship.

The Fringe's main comedy award was left without a sponsor last year after Intelligent Finance pulled out. Last month Bank of Scotland said it was ending its 16-year involvement with the annual end-of-Festival fireworks display, leaving organisers to plug a 225,000 funding gap.

The Edinburgh International Festival, which insists it is "too early to speculate" on whether the event could go ahead without a sponsor, said it was looking for a "family" of backers to take the flagship concert in Princes Street Gardens forward.

The annual concert, where the Scottish Chamber Orchestra is accompanied by a huge fireworks display from Edinburgh Castle, has become the highest-profile event in the Edinburgh festivals' calendar.

The RBS sponsorship deal of the Fringe covers both the Royal Mile arena, which includes Parliament Square, and a smaller arena on The Mound, next to the Royal Scottish Academy.

Fringe officials organise performance slots for theatre, music and dance companies and ensure buskers are given a daily slot to perform.

A spokesman for the Fringe added: "We'll be meeting RBS next month about whether or not they'll be involved with the Fringe again and we won't be able to say any more until then.

"It's not a matter of concern for us as we're fully focused on this year's Festival. It's a not a situation we need to worry about just now as we think the sponsorship of the High Street is a highly attractive proposition. I don't think we'll find ourselves without a sponsor."

A spokeswoman for RBS said: "We have been a major sponsor of the Edinburgh Festival Fringe for ten years and have valued that

relationship enormously. The latest contract is up for review now as it expires at the end of the current programme in September and we are in discussions with the Fringe about that.

"We continue to review all of our sponsorships to ensure they are meeting our goals both commercial and as an engaged corporate supporter of all our core markets not least here in Edinburgh. It remains our firm view that well chosen strategic sponsorships can be a very cost effective way to market our brand, engage our customers and also support sporting, cultural and other activities that enhance the communities in which we operate"