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Would the banks leave Scotland?

Q: Would the banks leave Scotland?

In 2014 the banks said, in their own words, that moving their registered offices was 'a technical procedure' with no operations or jobs attached. Scotland voted No, kept the brass plates - and then watched hundreds of branches close and the Royal Bank of Scotland rename itself NatWest. This page audits the scare against the record.

The short answer

"The banks will leave" was the loudest scare of September 2014, and it rested on a word: leave. What the banks actually announced was re-registering holding companies - moving the brass plate on a door in Edinburgh to a door in London. Their own chief executives said, at the time and in writing, that no operations or jobs were attached to it.

Scotland voted No, and the decade since has run the experiment the other way. The plates stayed. The branches closed anyway, by the hundred. The Royal Bank of Scotland took the word Scotland off the group nameplate. Whatever protected Scottish banking was supposed to look like, it wasn't this - and the honest lesson cuts both ways, as this page sets out.

What was said in 2014 - and by whom

In the final week of the campaign, with polls narrowing, RBS, Lloyds, TSB, Clydesdale and Tesco Bank announced contingency plans to establish or re-register legal entities in England in the event of a Yes vote (BBC News, 11 September 2014; The Guardian). Standard Life had said similar. Read what RBS actually told the market: re-domiciling the holding company "should have no impact on everyday banking services used by our customers throughout the British isles."

The bank's chief executive, Ross McEwan, wrote to staff the same day: "This is a technical procedure regarding the location of our registered head office... It is not an intention to move operations or jobs" (BBC News). Lloyds likewise: "This is a legal procedure and there would be no immediate changes or issues."

That is the entire substance of "the banks will leave Scotland": registered offices, described by the banks themselves as technical, explicitly detached from jobs and operations. The headlines said something rather different - and the way the story reached those headlines is worth a paragraph of its own.

RBS's board met on the evening of Wednesday 10 September to consider its contingency announcement. At around 10pm that night - before the bank had told the London Stock Exchange - the Treasury was briefing journalists that RBS had "similar plans to base themselves in London" (ITV News, 10 September 2014, 10:33pm). RBS confirmed to the market at 7am. The First Minister called the tip-off a matter of "enormous gravity" and demanded a formal leak inquiry; the Cabinet Secretary declined, saying the Treasury had merely "confirmed its understanding of RBS's contingency planning" (The Guardian, 11 September 2014; 12 September 2014). This site draws no conclusion about motive. It notes the record: market-sensitive news about a largely state-owned bank reached journalists from the government campaigning for No, at 10pm, eight days before the vote.

Brass plate or jobs?

A registered office determines which regulator supervises a bank and which central bank stands behind it. It is not where the people are. Banks arrange and rearrange these structures constantly: TSB has been Spanish-owned since 2015 and keeps its headquarters in Edinburgh; Clydesdale became Virgin Money and then part of Nationwide; Bank of Scotland has been run from London since Lloyds absorbed HBOS in 2009. The plates and the owners have been in constant motion - all of it inside the union, none of it put to a referendum.

So when you hear "the banks would move to London", the accurate translation is: some holding companies would re-register, as their executives said in 2014, and as NatWest's then chief executive Alison Rose repeated in 2021 - "we would move our registered headquarters to London", while the bank stayed put (Holyrood magazine, April 2021). Where the jobs sit is governed by where the work is done and where the skills are - which is why McEwan told his staff their jobs weren't moving, and why they didn't.

What the union delivered instead

Now the other half of the audit. Scotland voted No. The brass plates stayed in Edinburgh. And then:

Since 2015, Bank of Scotland has closed 214 branches in Scotland and Royal Bank of Scotland 183 (Which? bank branch closures tracker). NatWest Group as a whole has closed more branches than any other UK banking group. Communities across Scotland - including some where the nearest branch is now a bus journey away - discovered that keeping the union did not keep the bank on the high street.

And in 2020 the Royal Bank of Scotland - founded in Edinburgh in 1727 - renamed the group NatWest, retiring the word Scotland from one of the oldest names in banking. The registered office, for the record, remains 36 St Andrew Square, Edinburgh (Companies House).

None of this happened because Scotland stayed in the union; branch banking has shrunk everywhere as customers moved online. But that is precisely the point. The forces that actually determine banking jobs and services - technology, consolidation, cost - paid no attention whatever to the constitutional question. The No vote was sold as the way to keep Scottish banking; it kept the letterheads.

The scare behind the scare

We promised straight answers, so here is the serious version of the 2014 argument, stated at full strength.

Banks want a credible central bank behind them - a lender of last resort - and a deposit guarantee their customers trust. In 2014, with RBS's balance sheet still enormous relative to Scotland's economy, the banks' contingency plans were about exactly this: on a Yes vote, the holding companies would sit where the central bank sat. Rose made the same point in 2021: "our balance sheet would be too big for an independent Scottish economy."

Notice, though, what that argument actually concedes. If the plate moves to London, the balance sheet - and the theoretical liability for rescuing it - moves with it. The banks' own contingency plan is the answer to the "who would bail them out?" scare: the two scare stories cancel each other. What Scotland would keep is what it has: the jobs, the operations, the skills base, and the taxes that follow real activity. Meanwhile your deposits are protected by a guarantee scheme wherever the plate sits, and an independent Scotland would run its own, as every country does - the design of it tied to the currency choice, which is where the honest homework lives. The transition would need competent management and credible institutions; that is true, said plainly on our mortgages page, and it is a task Ireland, the Baltics and every other new state managed with thinner starting hands than Scotland's.

So what's the real question?

Not whether the banks would leave - they told us themselves in 2014, in writing, that the plates might move and the jobs would not. The decade since has shown what does move banking jobs and services, and it has nothing to do with flags: branches closed and names changed while Scotland stayed put.

The real question is the standing one. Banking regulation, deposit protection, and the response when a bank fails are all currently designed in London for the UK's financial system, with Scotland's interests weighed as a region of it. After independence they would be designed for Scotland's actual banking sector - the one with the jobs in it, not the holding companies. This site won't promise that would always be done well. It notes who would answer for it when it wasn't.

Take it with you

Facts for sharing - each button copies the line, with its source and a link back to this page.

RBS's own chief executive, the day the 2014 'banks will leave' story broke: 'This is a technical procedure... It is not an intention to move operations or jobs' (BBC, 11 September 2014)
The Treasury briefed journalists about RBS's 'move' at 10pm the night before RBS itself told the stock exchange. The First Minister demanded a leak inquiry; the Cabinet Secretary declined (ITV News; The Guardian, September 2014)
Scotland voted No and kept the brass plates. Since 2015, Bank of Scotland has closed 214 branches in Scotland and Royal Bank of Scotland 183 (Which? bank branch closure tracker)
In 2020 the Royal Bank of Scotland renamed itself NatWest Group - inside the union. Its registered office remains 36 St Andrew Square, Edinburgh (Companies House)