The company is concentrating on businesses with lucrative future
The Royal Bank of Scotland Group (RBS) has decided to retain its RBS Insurance division and it is no longer in discussions with interested parties regarding a possible disposal of the business.
As announced in November 2008, the Royal Bank of Scotland Group said that it is undertaking a strategic review with the aim of refocusing the group on those businesses that have credible future growth opportunities from customer franchises and which generate appropriate risk-adjusted returns. The board of RBS believes RBS Insurance meets these criteria and that it is in the best interests of shareholders for the group to retain the business.
Stephen Hester, group chief executive of RBS, said: Given RBS’s broader considerations, it was important to test the market for this business which has demonstrated that a sale on terms currently available would destroy value for RBS’s shareholders. RBS Insurance benefits from a leading market position, strong cash generation and low capital requirements. It does not absorb funding or risk-weighted assets and is not closely connected to the credit cycle. It can play an important role as we return the RBS Group to standalone strength.