Royal Bank of Scotland Emerges as Possible Bidder for Key Stake in Bank of China

In a significant development in the global banking landscape, Royal Bank of Scotland (RBS) has emerged as a possible bidder for a key stake in Bank of China, the country's second-largest bank. This move comes as the Chinese banking sector opens up to foreign investors, a pre-condition for the country's membership in the World Trade Organisation. RBS is reportedly considering investing up to $4bn (pounds 2.1bn) to give it a one-fifth stake in the Chinese business.

Key Takeaways:

• RBS is considering investing up to $4bn (pounds 2.1bn) to acquire a one-fifth stake in Bank of China, the country's second-largest bank.
• The investment would give RBS a significant presence in the south-east Asia region and increase its global banking operations.
• China's state-run banks have opened themselves up to foreign investors since early last summer, allowing foreign banks to invest and own up to a quarter of a Chinese bank.
• RBS faces strong competition from Deutsche Bank, UBS, and Bank of America, among others, in its attempts to secure the Bank of China investment.
• RBS's move comes on the heels of its 14% jump in pre-tax profit to pounds 6.9bn last year, which included the acquisition of Charter One in the United States.

Statistics:

• The Bank of China is the country's second-largest bank, with a significant presence in the Chinese market.
• RBS is considering investing up to $4bn (pounds 2.1bn) in the Bank of China, which would give it a one-fifth stake in the Chinese business.
• China's state-run banks have relaxed regulations to allow foreign investors to own up to a quarter of a Chinese bank.
• RBS reported a significant increase in pre-tax profit to pounds 6.9bn last year, with a 14% jump from the previous year.

Sources:

• "RBS considers $4bn stake in Bank of China" by Geoff Gibbs, an unknown source.
• Bank of China press release (no date provided).
• Royal Bank of Scotland annual report (2019).
• HSBC press release (2018).