RBS in total retreat, hands clients to BNP

In a move that should surprise no-one, Royal Bank of Scotland has confirmed it will no longer provide cash management and trade finance services to thousands of customers out of the UK and will instead refer them to French bank BNP Paribas.

The decision is part of its plan, announced in February, to shrink its investment bank and international operations and focus on lending to British households and businesses.

"As part of our strategy to make RBS a simpler, stronger and more sustainable bank, RBS Transaction Services will focus on its home market capabilities in the UK and the Republic of Ireland," said Marc Townsend, head of RBS's Global Transaction Services.  

Townsend said he was confident that BNP Paribas had "the people, country coverage, strong global product capability and infrastructure in transaction services to be an attractive alternative for our affected customers."

The effect on Australian market will be minimal as RBS had all but shut up shop here some time ago, with almost all assets and businesses sold off by the first quarter of this year. BNP Paribas has, however, been busy rebuilding its capacity in the ASEAN region generally - including Australia.

It's unclear, too, how much business BNP will actually pick up from RBS corporate clients needing trade finance services in the region as the RBS pull-back was telegraphed well in advance and most clients are likely to have made alternative arrangements.

BNP was unwilling to divulge how much extra business it expected to pick up in the Australasian market, and RBS was equally tight-lipped.