RBS Current Affairs
On 29 July, the Royal Bank of Scotland (RBS) has decided to sell its private banking business in India to Sanctum Wealth Management, in line of its prior decision to exit the Indian market.
Britain’s largest public bank Royal Bank of Scotland (RBS) has signed a non-binding framework agreement with Sanctum Wealth Management, which is a start up firm set by Shiv Gupta. He is also the present managing director of RBS’ private banking operations in India.
RBS has four private banking offices in India located in New Delhi, Mumbai, Bengaluru and Chennai.
The reason behind this decision is to formulate RBS into a stronger, more sustainable and simpler business for its aim to consolidate its business in the UK and Western Europe.
Note: RBS’s net balance sheet revealed at the end of December 2014 showed that its operations in India has fell by 1.7 billion Euros to 2.0 billion Euros due to reductions in corporate lending for the sectors like mining & metals, oil & gas and to banks.
IndusInd Bank has acquired the diamond and jewellery (bullion) financing business and related deposit portfolio of Royal Bank of Scotland (RBS) for 4,100 crore rupees on 28 July 2015.
Britain’s largest public bank Royal Bank of Scotland (RBS) was in talks with IndusInd Bank to sell off its bullion financing business and had signed a non-binding agreement in April 2015.
According to the agreement RBS’s employees within the diamond and jewellery clients in India would be transferred to IndusInd Bank.
RBS in 2008, had acquired ABN AMRO Bank the oldest banks in diamond and jewellery financing and started dealing in bullion financing in India through RBS Mumbai branch.
The reason behind this sell-off comes on the back of RBS’s decision in 2013 to exit its banking operations from India and to consolidate its business in UK and Western Europe.
However, it has decided to retain its back-office operations in India and has moved over 60 back-offices roles from the UK to India that has workforce of 12,000 people.
Prior to RBS’s decision it had shut down its 23 out of 31 branches in India and had also sold off its credit card business, commercial banking portfolios and mortgage business to Ratnakar Bank Ltd (RBL) Bank in 2013.
Note: The partnership agreement with ABN AMRO and RBS’ global knowledge and its ready bullion financing loan book of 4,500 crore rupees will help IndusInd to engage with the customers in the industry globally.