The likelihood of Royal Bank of Scotland offloading all of Williams & Glyn is diminishing as suitors attempt to carve out the best pieces of the bank and leave behind the more risky or less attractive bits.
RBS, which is 73pc owned by the taxpayer, warned last month that it would miss a deadline set by Brussels to divest the branches by the end of next year. The Treasury is in talks with Brussels about how to ensure a successful deal for W&G. A source said the discussions included potential sanctions against RBS for missing the deadline. RBS has said previously that it was in talks about selling “substantially all” of the business. Santander has also renewed its interest alongside challenger bank Clydesdale.
W&G has proved a long-running and costly saga for RBS, with the bank’s outdated computer systems posing a major obstacle to a sale. A deal to sell the branches to Santander collapsed in 2012, while this summer RBS scrapped a plan to spin off and float W&G to once again pursue a trade sale, even though it had already spent £1.5bn attempting to create a new computer network for the division. Dealmakers have suggested that if offloading W&G proves too problematic, RBS could offer alternative remedies to the Commission, including disposals of other businesses.