Oligopoly brief: Royal Bank of Scotland
The Royal Bank of Scotland, founded in 1727, has gone from being a Scottish bank to a British bank and now a world bank. By 2002, it had become the second largest bank in Europe and the fifth largest in the world, as measured by market capitalization.
Up until the 1970s, the Royal Bank concentrated on snapping up a series of other Scottish banks. By 1970, after a merger with the National Commercial Bank of Scotland, it commanded over 40% of all banking in Scotland. In the seventies, it expanded in England and Wales. In 1988, it expanded its operations to the United States, by acquiring Citizens Financial Group.
In 2002, in the largest bank deal in British history, the Royal Bank merged with the National Westminster Bank, one of England's largest. National Westminster itself was the result of a 1968 merger of National Provincial Bank and Westminster Bank.
Royal Bank of Scotland has continued to acquire other banks, in the US, in Switzerland, and in Bermuda. Just this week it announced plans to acquire Charter One Bank, a major regional US bank, making it one of the ten biggest banks in the US.
The Royal Bank is a major player in insurance. It is also a significant private bank, through its Coutts division. Like most major banks, the Royal Bank now has interests in a wide variety of financial areas. It claims to be:
- number one in the UK in corporate and commercial banking
- number one for small business customers in UK
- number one in UK offshore banking
- number one in private banking in UK
- number one in the UK for asset finance
- number one provider of private motor insurance in UK
- number two in the UK in retail banking
- number two in UK credit cards
- number two in general insurance in the UK
Some major divisions of RBS
