- Video report by ITV News Business and Economics Editor Joel Hills
Royal Bank of Scotland was born in Edinburgh almost three hundred years ago but in truth it’s not very Scottish.
The majority of its transactions happen South of the border and in future the group will be known as NatWest.
It’s a new name for a bank with a new chief executive and a new strategy.
“For me, the vision is to build a bank deeply embedded in the relationships with our customers and supporting the potential of people, families and businesses to thrive right the way across the UK,” said Alison Rose who became CEO in November.
The RBS brand took a hit when the bank collapsed into the arms of the taxpayer in 2008, the government remains its biggest shareholder and by far.
In 2019 the bank made a profit of £3.1 billion, in the black for a third consecutive year. £1.7 billion will be paid out to the government in the form of a dividend.
But RBS’s shareprice fell sharply today, closing at 213 pence, that’s less than half of what the government paid for its stake in 2008. We're still sitting on a big loss.
Alison Rose is promising a new chapter and a more sustainable bank in the face of what she calls “unprecedented disruption”
Banking is increasingly done on smart phones. Since 2008 the group has closed almost two thirds of its RBS and NatWest branches, just over 800 remain.
More change lies ahead but Rose is reluctant to reveal the details. “I will never talk about job losses before I have talked to my colleagues”, she insisted today.
Alison Rose wants the bank to play a leading role in tackling climate change. She plans to increase lending to fund renewable energy companies like Lightsource BP, a solar power project.
But the bank is also warning the major oil and gas producers, like BP, that it won’t do business with them from 2022 unless they demonstrate credible plans to cut their emissions.
The commitment is ambitious but given that only 1% of the bank’s balance sheet is to oil and gas companies some are wondering why the threat can’t be enforced immediately.
“In order to shift to a low carbon economy, we need a transition,” Rose insists. “In some cases the alternative energy sources are not there yet."
A change of name won’t transform RBS’s fortunes which are tied to the performance of UK economy. The bank predicts modest growth this year but still sees Brexit as a risk
Alison Rose’s grand plans may run into trouble if the government fails to secure a trade deal with the EU.