POLITICS

Scottish Independence Would Force RBS To Move To London, Warns Vince Cable

05/02/2014 13:24 GMT | Updated 05/02/2014 13:59 GMT
ASSOCIATED PRESS
A Royal Bank of Scotland (RBS) branch is seen in central London Thursday, Feb. 23, 2012. U.K. lender Royal Bank of Scotland saw its loss in 2011 swell by 78 percent as it booked large provisions for Greek debt and compensation for customers missold payment protection insurance. (AP Photo/Lefteris Pitarakis)

The Royal Bank of Scotland would "inevitably" move to London if Scotland gains independence in this September's referendum, Vince Cable has warned.

The Lib Dem business secretary told members of the Business select committee that RBS, which is 81% owned by the government, would be forced to leave its Edinburgh headquarters if Scotland broke away from the UK.

"I think if you were managing RBS you would almost certainly want to be in a domicile where your bank is protected against the risk of collapse," said Cable.

"I think they already have a substantial amount of their management in London and I would have thought that inevitably they would become a London bank."

Cable's warning about the fate of RBS, which was propped up with £45 billion of taxpayer support in a state bailout in 2008, comes after business leaders and ex-cabinet ministers lashed out at Scottish independence.

Former defence secretary Michael Portillo warned that Scotland breaking away from the United Kingdom could lose David Cameron the next election in 2015.

Meanwhile, Scotland's finance sector warned that the £11 billion-a-year industry would suffer a multi-million pound bill to pay for a new financial regulator if Scots vote for independence.

Bob Dudley, chief executive of the oil giant BP, said that he did not want to see Scotland "drifting away" from the United Kingdom, adding that "all businesses have a concern" about the referendum.

After BP released its latest results, Dudley said: "It does not seem the right thing to me for the country [Scotland] to drift off. That's not a company view, that's from me."