RBS, or Royal Bank of Scotland, is a retail banking subsidiary of the Royal Bank of Scotland Group. The Group’s other retail subsidiaries are NatWest and Ulster Bank. Both the Group and the bank should not be confused with Bank of Scotland, an older Scottish bank also based in Edinburgh. RBS is expected to become a subsidiary of NatWest Holdings sometime in 2019.
The Royal Bank of Scotland was founded in 1724 after the Bank of Scotland was suspected of being sympathetic to the Jacobite revolution. The ‘new bank’ was founded to create a bank with ties to the Whig ideology. In 1728 the bank invented the overdraft, allowing a merchant named William Hogg £1000 of credit. Overdrafts are now a cornerstone of modern banking.
RBS has some 700 branches mostly in Scotland and larger towns in England and Wales. The first London branch was opened in 1874.
In early 2018 RBS Group began restructuring to comply with new rules stating UK banks must ring-fence retail operations from investment banking. All existing RBS retail assets will transfer to Adam and Company, which will also continue as RBS’ private banking brand. In England and Wales, NatWest will become the primary customer-facing brand; this means over 250 RBS branches will be closed and located closer to NatWest branches.
RBS Products and Services
RBS offers a full range of banking services to business, commercial and personal customers. Personal banking services include current and savings accounts, loans and mortgages, credit cards, overdrafts, insurance and investments. The bank also has premium current accounts, with varying monthly fees, that give customers additional rewards.
Since 1946 RBS has also operated mobile branches in rural areas of Scotland, and currently has 19 of these branches housed in converted vans.
Premier is a more exclusive banking service available for free to RBS customers with an income of more than £100,000 (or jointly £120,000), outstanding mortgage lending of more than £500,000 or £100,000 in savings and investments.
Business Banking is divided into three divisions; SMEs, businesses with a turnover of more than 2m, and international trade hubs. RBS has partnered with online accounting software FreeAgent to help smaller businesses manage their accounts; other available services include business credit cards, overdrafts, business lending and overdrafts.
RBS is authorised by the Prudential Regulation Authority (PRA) and regulated by the Financial Conduct Authority (FCA) and Prudential Regulation Authority. Deposits of up to £85,000 are covered by the Financial Services Compensation Scheme (FSCS).