It’s a decade since RBS bought the Dutch bank ABN-Amro in one of the most overpriced, ego-driven and misguided takeovers in history.
A deal so wretched that it hobbled RBS’ balance sheet and dragged it down, like an anchor pulling down a drowning man.
The man behind it, Fred Goodwin, has become so discredited that his name is now a byword for hapless management.
RBS was bailed out by the Government and has spent the past 10 years dealing with the aftermath of the battles of the past.
But now, amid the wreckage, the bank has managed to salvage something. Like finding a photo album in the wreck of a house fire, the bank has discovered that there was some small redeeming quality in that ABN-Amro deal – a licence to operate in Europe.
Video: RBS outlines Brexit contingency plans
That is not something to sneer at. Right now, every single major financial institution in Britain is thinking about what it will do after Brexit, when the rules change and British-based banks can’t work across Europe in the way they presently do.
Few think those so-called passporting regulations will live on past the end of March 2019. For one thing, there are plenty of cities – Paris, Frankfurt, Luxembourg, Amsterdam and others – who all think they can use Brexit as a chance to expand their own financial bases, and don’t want their governments to help the British by coming up with new, helpful rules.
:: RBS reports first half-year profit in three years
For another thing, even if there was some kind of continental consensus that the City of London’s financial expertise is a net benefit to Europe, the chances of a fully-loaded deal being completed within the next year and a half are low.
Or, as one banker put it to me, “anybody who counts on a deal being done is either naive, or an idiot, or both”.
So most major financial companies based in Britain – and every single international bank headquartered in this country – are looking at a contingency plan that involves having a subsidiary in the European Union.
It’s a particularly big issue for American banks, which have often relied on London as their sole main European base, but every company involved in this is having to answer a simply, crucial question – are they 100% sure that, whatever Brexit deal may or may not be agreed, they can carry on servicing their customers through 2019 and beyond.
RBS is no different. It remains a huge, wide-ranging bank and even though its modern focus is largely placed up on retail customers, RBS retains an investment banking interest through its NatWest Markets division. And it’s that part that needs guaranteed access to the European markets.
Hence the pleasure at discovering that Dutch banking licence in the drawer. The licence is not enough on its own – it needs to be backed up with a fully capitalised company with its own staff and headquarters building – but it is sufficient to get the ball rolling.
So now RBS will identify about 150 staff to be based in the Netherlands, along with a place to house them.
It’s a sensible plan. Indeed, if RBS hadn’t come up with a proposal like this, to mitigate obvious risks to the business, then shareholders and regulators would have had cause for complaint.
But let’s also keep this within proportion: 150 jobs going to Amsterdam is little more than a rounding error in the HR department – less than one-fifth of one percent of the RBS workforce.
So yes, this is significant, but predictable. More important to the future of the bank is the work being done to pay off legacy fines and rebuild its balance sheet.
That is a slow, demanding and very expensive task, but the signs are that RBS is gradually going in the right direction.