Royal Bank of Scotland has formally changed its name to NatWest Group on Wednesday, removing Scotland from the name of the lender’s parent company for the first time since it was founded in Edinburgh in 1727.
The banking group remains headquartered in the city, and the name change will not affect RBS bank branches, most of which are in Scotland, or Ulster Bank locations in Northern Ireland.
The banking group announced the intended change in February when it reported its annual results.
It hopes the name change, and other measures including a focus on its environmental targets, will help it to move on from past scandals, including its near-collapse in 2008, when it was rescued by a £45bn government bailout during the financial crisis.
The bank is still 62% taxpayer-owned, although the government intends to sell off the remainder of its stake by 2024.
Its chief executive, Alison Rose, called it an “historic day” for the bank, which has 19 million customers in the UK and Ireland, and said “although there will be no changes to our customer brands, it’s a symbolic moment for our colleagues and stakeholders”.
“The bank has changed fundamentally over the last decade and now is the right time to align our group name with the brand under which the majority of our business is delivered,” Rose said.
The name change was “almost inevitable”, according to Chris Carter, professor of strategy at the University of Edinburgh Business School, as the bank’s “swashbuckling days of the noughties are now seen as a misadventure”.
Carter views NatWest Group as an “analogue bank in a digital age” and believes it needed to change.
“For the name change to work, it must be followed by real change. The bank needs to be clear: what does it stand for? What makes it different? What parts of its history is it trying to promote? Why should people trust the bank?” Carter said.
Tony Mackay, a professor of economics in Inverness, believes the decision is a fresh example of what he sees as a decline in Scotland’s financial services industry.
“The change may not make a difference to bank customers but I believe it is a significant blow to the reputation of the financial services industry in Scotland,” Mackay said.
Rose’s strategic overhaul includes environmental targets, such as halving the climate impact of its financing activity by 2030.
The bank has appointed Nicholas Stern as an independent climate change adviser to help it meet its targets, and to drive its environmental strategy. His 2006 report helped pave the way for the UK Climate Change Act.
Lord Stern, who is chair of the Centre for Climate Change Economics and Policy, will spend eight days a year in the newly created role, initially for two years.
Rose announced in February that NatWest Group would stop lending and offering underwriting services to any major oil and gas producers which do not have credible transition plans in line with Paris climate agreements.
The company has also vowed to phase out coal financing by 2030, which accounts for about 0.3% of the bank’s lending.
Stern said it was “crucially important for financial institutions to rise to the climate emergency” and called for new investment following the coronavirus crisis to drive a “new and attractive model of low-carbon development”.
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