The Duke and Duchess of Cambridge have named their daughter Princess Charlotte – a decision which will be seen as a touching tribute to the Prince of Wales.

William and Kate have also recognised the Queen – Elizabeth II – and the Duke’s mother Diana, Princess of Wales, as their daughter’s full name is Charlotte Elizabeth Diana.

Naming their baby Charlotte, which is the feminine form of Charles, is a gesture sure to have pleased the heir to the throne, who made no secret of the fact he wanted his second grandchild to be a girl.

William’s uncle Earl Spencer tweeted his approval of the names chosen by the Cambridges soon after their announcement.

Royal couple have given daughter a traditional name

The Duke and Duchess have given their daughter a traditional name which has strong royal connections as a number of princesses and a Queen have been called Charlotte.

The Princess, who was born on Saturday May 2 at 8.34am, weighing 8lbs 3oz, is fourth in line to the throne and the Queen’s fifth great-grandchild.

Kensington Palace said in a short statement: “The Duke and Duchess of Cambridge are delighted to announce that they have named their daughter Charlotte Elizabeth Diana.

“The baby will be known as Her Royal Highness Princess Charlotte of Cambridge.”

The betting industry is estimated to have paid out £1 million to punters who guessed the name correctly, according to Ladbrokes.

Soldiers from the King’s Troop Royal Horse Artillery marking the arrival of Britain’s new royal baby with a 41-round Royal Salute in Hyde Park, London yesterday. Photo: Reuters

It had been heavily backed and was a favourite during the week before the name Alice reclaimed the top spot. Ladbrokes spokeswoman Jessica Bridge said: “Charlotte was the hot tip over the weekend and royal watchers up and down the land are quids in. We may have lost a fortune but we’re paying out with a smile and wish the Duke and Duchess all the best.” Bookies William Hill said they were breathing a sigh of relief that William and Kate picked Charlotte, and not their favourite Alice.

Spokesman Rupert Adams said Charlotte finished as their 3/1 second favourite, with 5,096 punters correctly guessing the name and in total they would pay out just over £100,000 in the name market.

One lucky royal fan – a woman from Barnes – has won £1,400 after placing £400 on the correct name at odds of 5/2 on Saturday evening.

The baby princess will join a host of famous women with the same name from the 19th-century writer Charlotte Bronte and the Welsh singer Charlotte Church to the actress Charlotte Rampling.

The name is also likely to become popular with parents across the country. At the moment, it is languishing outside the top 10 most popular girls names for last year, as compiled by the website www. babycentre.co.uk. Top is Sophia, followed by Emily and then Lily.

Charlotte is only 17th in the list.