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NAB will move Clydesdale to England if Scotland secedes

NAB said re-registering Clydesdale, which also owns the Yorkshire Bank brand, would "address some of the uncertainties and risks surrounding terms of the separation" if Scotland votes to secede. NAB said re-registering Clydesdale, which also owns the Yorkshire Bank brand, would "address some of the uncertainties and risks surrounding terms of the separation" if Scotland votes to secede.
National Australia Bank will move its Glasgow-based Clydesdale Bank to England if Scotland votes for independence at next week's referendum.

With polls predicting a tight contest in the vote next Thursday, NAB last night said its contingency planning included re-registering Clydesdale as an English company in the event of a "yes" vote.

NAB said re-registering Clydesdale, which also owns the Yorkshire Bank brand, would "address some of the uncertainties and risks surrounding terms of the separation" if Scotland votes to secede.

"This contingency plan gives our Clydesdale and Yorkshire Bank customers increased certainty about the ongoing success and stability of the bank," chief executive Andrew Thorburn said in a statement.

Registering in England would involve extra costs from moving the head office,  and regulatory approvals. It also would ensure the Bank of England remained the lender of last resort to Clydesdale.

Investors are starting to seriously assess the implications of a vote in favour of independence, after a weekend poll put the pro-independence vote narrowly ahead for the first time.

Royal Bank of Scotland and Lloyds have also said they are making contingency plans to move to London in the event of a "yes" vote.

Clydesdale is the third biggest bank in Scotland, and analysts say banks based in the country could face higher costs and added uncertainty if it votes for independence.

On Monday, a report by Credit Suisse analysts Jarrod Martin and James Ellis estimated that moving Clydesdale's head office from Glasgow to London would cost about £62.4 million ($107 million).

Due to Scotland's super-sized financial sector, the report also argued a vote in favour of secession would trigger a jump in bad debts across the economy, caused by capital flowing out of the country.

Such a scenario could squeeze earnings in NAB's banking arm by as much as 20 per cent, although this would translate to only a 1 per cent impact on total group profits, the report said.

Author: Clancy Yeates
Source: Sydney Morning Herald

 

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