'Core franchise' Ulster Bank targets growth - RBS chief
Published 28/09/2016 | 02:30
Ulster Bank owner RBS says the Irish unit is a "core franchise" for the UK taxpayer-owned group.
The bank said its Irish arm is targeting a greater share of the mortgage market here, lower costs and more capital efficient use of its legacy loan assets to drive growth.
Royal Bank of Scotland (RBS) group chief executive Ross McEwan made the comments in a presentation at a conference organised by Bank of America Merrill Lynch in London yesterday.
At the same event, he indicated he may fail in a plan to sell the bank's Williams & Glyn unit, headed up by former Ulster Bank chief executive Jim Brown. RBS was ordered to carve out and sell England and Wales-focused Williams & Glyn to meet European State Aid rules but has struggled to separate it from the main RBS brands.
The bank is still working towards a sale of the asset, he said.
However, RBS is "having to think about the what ifs" in the event of being unable to secure a buyer for Williams & Glyn by the end of 2016, the ceo said at the conference, admitting the bank will be "in uncharted territory if we don't actually sell the assets" on time.
Ulster Bank was seen as the "biggest headache" at RBS when it swallowed a £15bn (€17bn) UK taxpayer-supported bailout in the wake of the crash.
The Irish banking crisis prompted speculation Ulster Bank might be sold. However, the Irish unit is now regarded as a "core franchise" alongside the banking giant's UK retail arms, Mr McEwan said.
The traditional split between Ulster Bank units in Northern Ireland and the Republic has been deepened over the past year. In the Republic, new Ulster Bank chief executive Gerry Mallon will "drive a strong and profitable franchise," Mr McEwan said.
Ulster Bank will look to continue cost reduction, increase mortgage market penetration (from the current 18pc market share), and increase capital efficiency of the bank's legacy loan book, he said. (Additional reporting Bloomberg)