NAB not greatly tempted to increase its stake in UK banking market
The Age
Tuesday November 3, 2009
NATIONAL Australia Bank would be permitted to make a move on the 300-plus branches that Royal Bank of Scotland may be forced to offload under a broader shake-up of Britain's banking market.But NAB chief executive Cameron Clyne remains cautious about expanding overseas, given the troubled state of banking markets, particularly in Europe.The British Government and the European Union this week jointly agreed to an overhaul of part-nationalised lenders such as RBS and Lloyds Banking Group, including a forced sale of parts of their branch network over the next few years,The RBS branches earmarked for sale are mostly focused on small to mid-sized business lending, but the Lloyds sale extends to more than 185 branches of Lloyds TSB Scotland. Under rules of the sale, the British Government will ensure that any potential buyer does not emerge with a share above 15 per cent of any specific market.Through its Clydesdale Bank, NAB has a 3 per cent share of Britain's deposit and lending market and about 4 per cent of the small to mid-sized business market. But its share of the Scottish banking market is closer to 15 per cent.Spain's Santander €” which analysts say is best placed to make a move on RBS assets €” has up to 8 per cent of Britain's small-business lending market and almost 14 per cent of the retail banking market.NAB has previously been sounded out by the British Treasury about acquiring select parts of struggling building society Northern Rock, but has been cool on a such move. While Mr Clyne has made several mid-sized acquisitions in Australia this year, he recently described the British banking market as "dysfunctional".
© 2009 The Age
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