RBS share price outperforms as Santander eyes Williams & Glyn

on Jul 18, 2016
Updated: Oct 21, 2019

Spain’s Santander is looking at a restructured deal to acquire Royal Bank of Scotland Group’s (LON:RBS) Williams & Glyn business, Sky News has revealed. The bailed-out lender warned earlier this year that it might miss yet another EU deadline to divest the branches.

RBS’ share price has surged in today’s session, having gained 1.85 percent to stand at 187.40p as of 09:34 BST. The shares are outperforming the benchmark FTSE 100 index which currently stands 0.35 percent higher at 6,692.61 points. The group’s shares have lost more than 48 percent of their value over the past year, and are down by some 38 percent in the year-to-date.
Sky News reported yesterday that Santander had been looking at whether it can take on RBS’ Williams & Glyn business through an asset-transfer deal. This would involve Santander UK acquiring W&G’s roughly £24 billion of deposits, more than 300 branches and nearly two million customers but without requiring RBS to complete an IT programme to create a separate banking platform. Sources with knowledge of the matter told the newswire that negotiations had been taking place between RBS and Santander about a deal structured as an asset transfer, but that it was unclear whether it would be feasible.

The sources pointed out that such a transaction would also be complex, but highlighted a statement by the bailed-out lender in April that it was now “exploring alternative means to achieve separation and divestment”.
RBS, bailed out by the UK government during the financial crisis, has been ordered to sell the business as a condition of its £45.5-billion taxpayer-funded rescue. The process, however, has been marked by a series of delays, causing the blue-chip lender to miss its first deadline of December 2013. Earlier this year, the group warned that there was “a significant risk” it would miss a deadline of December 2017.
As of 10:07 BST, Monday, 18 July, Royal Bank of Scotland Group share price is 187.30p.