RBS and Lloyds shares rise as Scottish independence 'no' vote looks more likely

Both banks were among the FTSE 100's biggest risers as they revealed plans to move south if independence goes ahead.

by Elizabeth Anderson
Last Updated: 17 Sep 2014

Royal Bank of Scotland and Lloyds Banking Group were among the biggest risers in the FTSE 100 when markets opened this morning, up 2.1% and 1% respectively after the two banks revealed plans to relocate their headquarters to London if Scotland votes ‘yes’ to independence.  

RBS shares rose 2.1% to 350.56p while Lloyds shares were up by 1.3% to 74.3p when the FTSE 100 opened, and by mid-morning were still trading strong at 346.10p and 73.8p.

It came after a new poll showed a majority of Scots intend to vote against independence in next week's referendum. The poll, carried out by Survation on behalf of the Daily Record newspaper, showed 53% intending to vote no to the split, and 47% yes.

Meanwhile RBS confirmed it will re-domicile to London if Scottish independence goes ahead, following firms including Lloyds and Standard Life which say they will relocate if the 307-year union is broken up.

RBS, which has been based in Scotland since 1727 and employees 11,500 staff there, said it had taken the decision because a vote for independence would create uncertainties which could impact its credit rating and its ability to borrow.

‘RBS has undertaken contingency planning for the possible business implications of a ‘Yes’ vote. RBS believes that this is the responsible and prudent thing to do and something that its customers, staff and shareholders would expect it to do,’ the state-backed bank said in a statement today, adding: ‘In the event of a 'Yes' vote, the decision to re-domicile should have no impact on everyday banking services used by our customers throughout the British Isles.’

Lloyds Banking Group, which currently employs 16,000 staff in Scotland, said late last night that its contingency plans for Scottish independence included setting up ‘new principle legal entities in England’. It followed a statement by Edinburgh-based insurer Standard Life reiterating that it could transfer business to England if necessary after the vote.

Ratings agency Standard & Poor's has previously warned an independent Scotland would be unable to credibly support its banks if a new financial crisis struck.

Responding to the announcements by RBS and Lloyds, Alex Salmond told the BBC: ‘We know the moves both from Lloyds and the Royal Bank of Scotland will have no impact on operations or jobs. They are about brass plaques. These are contingency plans and they make it quite clear in the statements that they make.’

John Lewis has warned that prices in Scottish branches of its stores could be higher if the country votes yes to independence.

'It does cost more money to trade in parts of Scotland, and therefore those higher costs in the event of a Yes vote are more likely to passed on,' Chairman Charlie Mayfield said.

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