Clydesdale Mulling Bid for RBS's Williams & Glyn Unit, CEO Says

  • David Duffy says he had a `request for us to participate'
  • CYBG will look at RBS unit before considering whether to bid

CYBG Plc Chief Executive Officer David Duffy said the lender may consider joining bidders for the British consumer bank put up for sale by Royal Bank of Scotland Group Plc as the unit draws interest from an increasing number of other banks.

“There has been a request for us to participate in a review of what proposals they have for their Williams & Glyn structure,” Duffy, who runs the Clydesdale and Yorkshire Bank brands spun out of National Australia Bank Ltd., said in an interview on Thursday. “We’ll look at it in a purely agnostic context to understand what it is. Only after we understand what that particular bank is would we ever consider whether we’re going to proceed.”

David Duffy

Photographer: Aidan Crawley/Bloomberg

RBS said in January it would sound out potential buyers for Williams & Glyn, a British consumer and commercial bank made up of about 300 U.K. branches, after receiving a number of approaches while preparing the unit for an initial public offering. Britain’s largest government-owned lender must spin off the Williams & Glyn unit by the end of 2017 to meet European Union state-aid rules related to its 45.5 billion-pound ($66 billion) bailout at the height of the financial crisis. 

“Like others out there, we would be viewed as a consolidation candidate,” Duffy said by telephone on CYBG’s first day of trading as a standalone lender.

Spain’s Banco Santander SA is preparing an offer for Williams & Glyn, while billionaire Richard Branson’s Virgin Money Holdings UK Plc has also signaled interest, Sky News reported. Secure Trust Bank Plc Plc, led by former RBS banker Paul Lynam, is also mulling an offer, according to the Sunday Times.

The 178-year-old CYBG is the largest publicly traded independent bank seeking to win a bigger market share in Britain. National Australia Bank raised as much as 396 million pounds in the sale, priced at the lower end of the range. That valued the U.K. consumer bank at 1.58 billion pounds. 

Britain’s challenger banks could consolidate to stand a better chance of breaking the dominance of the nation’s four-biggest banks. RBS, HSBC Holdings Plc, Barclays Plc and Lloyds Banking Group Plc, together control as much as 80 percent of the market. Spain’s Banco de Sabadell SA, which bought TSB Banking Group Plc last year to enter the U.K., should consider buying Williams & Glyn, according to analysts.

The unit has some 1.8 million customers, with deposits of 24 billion pounds at the end of the third quarter, according to latest company filings. RBS will release full-year earnings on Feb. 26.

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