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The Royal Bank Of

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It is the first bank to promise not to withdraw its loans in an effort to ensure its 1.1 million customers to survive the recession.

The recession was first noticed around october of 2008 when a bailout plan was announced and HM Treasury bought ?5 billion in RBS preference shares. The Treasury would infuse ?37 billion ($64 billion, ?47 billion) of new capital into Royal Bank of Scotland Group Plc, Lloyds TSB and HBOS Plc, to avert financial sector collapse. In the event, less than 56 million new shares were taken up by investors, or 0.24pc of the total offered by RBS in October 2008.

The move was by politicians and small businesses.

But there are fears that the pledge May to late for many companies already higher cost of borrowing.

"The company violated"

RBS, which is also owner of NatWest, was heavily influenced by the global financial crisis.

Earlier this week, shareholders voted their ? 20 billion government bail-out of taxpayers' money.

The vote means the government could end a stake of up to 60% in the troubled bank.

The BBC''s business correspondent Joe Lynam, said the fact that a bank was a public promise to honor agreed was discovered that a measure of how bad the credit crisis has affected the normal lending practices.

Stephen Alambritis of the Federation of Small businesses (FSB), said other banks would follow.

"Now it is time for them to wake up to the fact that they were saved, so that you can turn small businesses," he said.

"Small businesses are damaged by the way they were treated unfairly by the banks expect that the government, which now has a stake in banks to ensure that balance again."

He said he was confident that other banks follow the lead of RBS.

"They have a great tradition of copycat tactics. Banks are like oil tankers battle - they are very slow to move, but once one of them moves, is good news," he added.

Scottish small business like many other businesses around the globe have suffered the consequences of the credit crunch so taking this inconsideration the Royal Bank of Scotland has taken the initiative to make sure that many local small businesses won''t go under and that the tough financial stress won''t create a catastrophic collapse that will hurt the local economy.

Small business credit and consumer credit are the life and blood of any financial system so it is the duty of those in charge, in this case the Royal Bank of Scotland, to step up and protect their assets and the future and financial solvency of small business that just like many others are struggling to make ends meet at the end of the day.

The Royal Bank Of

The merger of The Royal Bank of Scotland (RBS) and National Westminster Bank (Nat West) as well as other major British banks including Barclays and Woolwich Building Society has created major economical and social interest boasting scholarly debate (Papers4you.com, 2006). It is important to understand why such mergers take place and the potential gains of doing so. The RBS and Nat West merger was formed in delivering Nat West from inefficiencies of poor services originally formulated from the merger bid proposed by the Bank of Scotland. Nat West will benefit from the forward thinking impact present at the RBS Group. The entrepreneurial spirit will help the bank as well as the whole merger to move forwards in a highly competitive market simultaneously maximising customer satisfaction - a major key to survival in this industry. Impact on shareholders during the merger or discussion process can vary bringing about instability and lack of confidence. Following the completion of the RBS £20.8 billion bid; share yields rose in price to an attractive level in line with the UK economy thereby portraying the strength of the merger. In essence the driving force behind the success of the RBS bid over the Royal Bank of Scotland was in fact the higher share price expectations offering the perfect icing. There are many foreseeable benefits of merging to create a larger customer base, maintaining market power and ultimately reducing risk (Papers4you.com, 2006). However, in the reshuffling process redundancies and unemployment are highly evident. A BBC News article revealed that the RBS hopes to achieve efficient operation by cutting costs by £1 billion thereby threatening 18,000 Nat West Employees (Friday, 11 February, 2000). Nevertheless, employee downsizing moves with the financial services market where the shift from branch based services to E-commerce in terms of internet and telephone banking services. Henceforth, new areas of employment are created accommodating an advancing system thereby giving scope to major economies of scale. Thus the merger boasts upon innovation and development where further employees will be trained to the highest standards to deliver customer services and knowledge of products achieving greater efficiency. Today the RBS and Nat West group are growing from strength to strength with worldwide status and second largest market capitalisation within Europe. The rise of this super bank portrays the positive impact of combating competition and placing the consumer at the heart of merger proposals.

References

Anderton, A (2001) Economics Third Edition, Causeway Press

BBC News Articles;

Thursday, 27 January, 2000, ‘Bank of Scotland: bold move by UK's oldest bank’ http://news.bbc.co.uk/1/hi/business/621123.sm

Friday, 11 February, 2000, ‘Nat West merger's mixed fortunes’ http://news.bbc.co.uk/1/hi/business/639201.stm

Monday, 7 February, 2000, ‘Banking on size to compete’ http://news.bbc.co.uk/1/hi/business/the_company_file/456551.stm

Papers For You (2006) "P/F/125. Master's Dissertation. UK Banks' Merger: Evidence from 1995-2001 Period", Available from http://www.coursework4you.co.uk/sprtfina33.htm [17/06/2006]

Papers For You (2006) "P/F/73. Synergy from the Mergers and Acquisitions: cases of two real mergers (Royal Bank of Scotland and NatWest; Barclays Bank and the Woolwich)", Available from Papers4you.com [18/06/2006]

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Both Gen Wright & Verena Veneeva are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Gen Wright has sinced written about articles on various topics from Terrier Dogs, Acne Treatment and Lose Weight. To learn more about business in Scotland and to find great business resources visit our at. Gen Wright's top article generates over 1220000 views. to your Favourites.

Verena Veneeva has sinced written about articles on various topics from Entrepreneurship, Health and Management. Copyright © 2006 Verena Veneeva. Professional Writer working for. Verena Veneeva's top article generates over 60500 views. to your Favourites.

Bedtime Stories Part 5
They think that this kind of beneficence will clear them and they will go scot- free in spite of their sinfulness. Such are some of the various motives for work.