RBS sells 318 branches to Santander for £1.6b

Britain’s state-controlled Royal Bank of Scotland yesterday agreed to sell 318 branches to Santander in a deal that will further expand the Spanish group’s presence on the high street.

The bailed-out bank, which is due to unveil first-half profits tomorrow, said it would sell the branches in a transaction worth an estimated £1.65 billion.

RBS, 83 per cent owned by the British government, is selling assets in line with a demand made by the European Commission, in exchange for the state aid it received during the global financial crisis.

“This is an important milestone in our restructuring work and complements the significant momentum behind our recovery plan overall,” said RBS chief executive Stephen Hester in the statement.

“The bank is becoming stronger, which allows an increased focus on serving ongoing customers and improving commercial success; all a pre-requisite for the profitable realisation of taxpayers’ stake in RBS.” Antonio Horta-Osorio, chief executive of Santander UK, hailed the move as an “important“ step for the group, which already has 1,300 bank branches in Britain after a series of carefully-timed takeovers over the last six years.

“This is a very important strategic deal for Santander in the UK that builds on our retail strength,” he said, adding the transaction will expand its activities in small and medium-sized business sector.