RBS: Citizens Bank Not For Sale
After speculation that Massachusetts customers of Citizens Bank could find their bank under new ownership, the bank's parent company, the Royal Bank of Scotland, said it would keep Citizens Financial Group.
Providence, R.I.-based Citizens is a highly profitable $153 billion commercial bank holding company that employs about 24,000 people. It’s also the second-largest retail bank in Massachusetts, after Bank of America.
On Monday, RBS said negotiations over the bank’s bailout terms with the British Treasury and the European Commission were “in their final stages, and will include some divestments not initially contemplated.” That led to speculation that Citizens would have to be sold to pay off its bailout from the British Treasury.
John Carusone of the Bank Analysis Center in Hartford, Ct., said the valuable bank would have been attractive to banks from the Midwest to Maine. “There’s no shortage of well-capitalized community banks that covet Citizens’ locations,” he said. “They’d be delighted to bid for 15 or 20 branches at a time.”
RBS reportedly negotiated hard with European regulators to keep its U.S. operations as a part of its core business.
“Today’s announcement once again affirms that Citizens Financial Group is a valued part of the RBS Group,” Citizens’ CEO Ellen Alemany said. “We will continue to serve the needs of our customers and execute on our long-term strategic plan.”
Bank analyst John Carusone said the pressure is now on RBS to successfully navigate the international economy, credit quality and bank regulators to avoid having to put Citizens on the block after all.
This program aired on November 3, 2009. The audio for this program is not available.