The Royal Bank of Scotland (RBS) today said it will sell its 318 branches to personal finance services firm Santander UK Plc for about 1.65 billion pounds.
Santander would pay the consideration of 1.65 billion pounds in cash, which includes a premium of 350 million pounds over the net asset value of 1.3 billion pounds, RBS said in a statement.
The transaction, currently expected to be completed by December 2011, is subject to necessary regulatory and anti-trust conditions, among others.
The sale comprises 311 RBS-branded branches in England and Wales, seven NatWest-branded branches in Scotland, the retail and SME customer accounts attached to these branches, the Direct SME business, and certain mid-corporate businesses.
"This is an important milestone in our restructuring work, and complements the significant momentum behind our recovery plan overall. The bank is becoming stronger, which allows an increased focus on serving ongoing customers and improving commercial success," RBS Chief Executive Stephen Hester said.
The separation and transfer process would take 12 to 18 months for completion.
The business to be sold had total assets of 21.5 billion pounds, customer deposits of 22.4 billion pounds and risk-weighted assets of 15.2 billion pounds.
The sale is part of RBS's efforts to comply with the European Union's rules on state aid to businesses.
Meanwhile, RBS would continue to have a big branch network under its own brand in Scotland and the NatWest brand in England and Wales.
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