Santander, NAB weigh bids for RBS network

Edinburgh: Banco Santander SA, the biggest Spanish bank, and National Australia Bank (NAB) Limited are among at least four companies that have expressed interest in buying part of the Royal Bank of Scotland (RBS) Group Plc's UK branch network, said two people with knowledge of the situation.

Banco Bilbao Vizcaya Argentaria SA, Spain's second-largest lender, and Richard Branson's Virgin Money Limited are also among the bidders for the 318 branches, said the people who declined to be identified because the talks are private. The deadline for bids was 5pm on Tuesday.

Edinburgh-based RBS is selling the outlets to comply with European Union (EU) regulations after it received a government bailout in 2008 and 2009. The bank will sell branches in England, Wales and Scotland under the Williams & Glyn brand, which RBS created in 1970 and then subsumed in 1985. RBS has about 2,250 branches in the UK.

"This is an unusual asset to come up for sale and is therefore attractive," said Bruce Packard, an analyst at Seymour Pierce Limited in London who has a "sell" rating on RBS. "It allows banks to acquire a network of branches rather than having to build one organically, which can be difficult and take time."

JC Flowers & Company, the New York-based private-equity firm, also submitted a bid for the branches, Sky News reported, without saying where it got the information. A JC Flowers spokesman declined to comment.

RBS fell 0.3 per cent to 44.83 pence in London on Tuesday.

The bank is trading about 11 per cent less than the average paid by the state for a stake when it rescued the lender.