Royal Bank of Scotland facts for kids
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Dundas House in Edinburgh, built in 1774, acquired by the Royal Bank of Scotland in 1821 and still its registered office
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Native name
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Banca Rìoghail na h-Alba
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| Public limited company1 | |
| Industry | Financial services |
| Founded | 31 May 1727 |
| Headquarters | Edinburgh, Scotland, UK |
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Key people
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| Services |
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Number of employees
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71,200 |
| Parent | NatWest Group |
| Footnotes / references 1 Wholly owned subsidiary of NatWest Holdings. |
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The Royal Bank of Scotland (which is Banca Rìoghail na h-Alba in Scottish Gaelic) is a big bank in Scotland. It helps people and businesses with their money. It's part of the NatWest Group, just like NatWest bank in England and Wales, and Ulster Bank. The Royal Bank of Scotland has about 700 branches, mostly in Scotland. You can also find its branches in many larger towns and cities across England and Wales. This bank is completely separate from another Edinburgh-based bank, the Bank of Scotland, which started 32 years earlier. The Royal Bank of Scotland was created to be a bank with strong connections to the House of Hanover and the Whig political group.
The bank is now a direct part of NatWest Holdings. This change happened in 2019 as part of a plan to separate the bank's main business from its investment banking side.
Contents
The Bank's Story: How it Began and Grew
How the Royal Bank of Scotland Started
The bank's story began with a group of investors. They were part of a failed company called the Company of Scotland. When that company didn't work out, these investors received money as part of a deal called the Acts of Union in 1707. They formed a group to protect their money, which was first called the "Society of the Subscribed Equivalent Debt."
This group later became the "Equivalent Company" in 1724. They wanted to start a bank. The British government liked this idea because the "Old Bank," the Bank of Scotland, was thought to support the Jacobites, who wanted a different king. So, on May 31, 1727, the "New Bank" was officially created and named the Royal Bank of Scotland. Archibald Campbell, Lord Ilay, became its first leader.
On May 31, 1728, the Royal Bank of Scotland came up with a new idea: the overdraft. This was a big step forward in banking. It allowed a merchant named William Hogg in Edinburgh to borrow up to £1,000, even if he didn't have that much in his account.
Early Rivalry with the Bank of Scotland
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The two banks, the "Old Bank" (Bank of Scotland) and the "New Bank" (Royal Bank of Scotland), were big rivals. They especially fought over who could issue more banknotes. The Royal Bank wanted to make the Bank of Scotland go out of business or take it over.
The Royal Bank collected many of the Bank of Scotland's notes. Then, it suddenly demanded that the Bank of Scotland pay them back. To do this, the Bank of Scotland had to ask people to pay back their loans. In March 1728, it even had to stop making payments for a short time. This hurt the Bank of Scotland's reputation.
Even though there was talk of the two banks joining, the Royal Bank couldn't make it happen. By September 1728, the Bank of Scotland started paying back its notes. To stop future attacks, both banks added an "option clause" to their notes. This meant they could delay payments for six months while the notes earned interest. Eventually, both banks realized their fight was hurting everyone. They made a truce, but it took until 1751 for them to agree to accept each other's banknotes.
Growing Across Scotland
The Royal Bank opened its first branch outside Edinburgh in 1783, in Glasgow. More branches soon opened in other Scottish towns like Dundee, Rothesay, and Greenock in the early 1800s.
In 1821, the bank moved its main office in Edinburgh. It went from the Old Town to Dundas House in the New Town. This beautiful building was designed by Sir William Chambers and finished in 1774. Inside, there's a special banking hall with a blue domed roof and gold stars, designed by John Dick Peddie in 1857. This hall is still used as a bank branch, and Dundas House is still the bank's main registered office today.
Throughout the rest of the 1800s, the bank joined with other Scottish banks, often when those banks were struggling. For example, it took over the Western Bank in 1857 and the Dundee Banking Company in 1864. By 1910, the Royal Bank of Scotland had 158 branches and about 900 employees.
In 1969, the Royal Bank of Scotland merged with the National Commercial Bank of Scotland. This created a new main company, which was later renamed The Royal Bank of Scotland Group in 1979. This group became NatWest Group in July 2020.
Expanding into England
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As the British Empire grew in the late 1800s, London became a huge financial center. Scottish banks wanted to open branches there. The Royal Bank of Scotland opened its first London branch in 1874. However, English banks tried to stop Scottish banks from expanding too much into England. An agreement was made: English banks wouldn't open branches in Scotland, and Scottish banks wouldn't open branches in England outside London. This agreement lasted until the 1960s.
After World War I, the Royal Bank started expanding in England again. It bought smaller English banks like Drummonds Bank (in 1924), Williams Deacon's Bank (in 1930), and Glyn, Mills & Co. (in 1939). These banks eventually became part of the Royal Bank.
Recent Times and Changes
In the late 1970s and early 1980s, other banks tried to buy the Royal Bank. Lloyds Bank and Standard Chartered Bank both made offers. Later, the Hongkong and Shanghai Banking Corporation (HSBC) also tried to buy it. However, the British government decided that these takeovers would not be good for the public.
The Royal Bank did have a partnership with Banco Santander Central Hispano from Spain for a while. They each owned a small part of the other bank. But this ended in 2005.
The bank also started to grow internationally. Its first office outside the UK opened in New York in 1960. Later, offices opened in other U.S. cities and Hong Kong. In 1988, the bank bought Citizens Financial Group, a bank in the United States.
In 2011, the Royal Bank of Scotland faced some computer problems that stopped customers from getting to their accounts. In 2013, the bank's CEO, Stephen Hester, stepped down, and Ross McEwan took over.
In 2014, during the vote on Scottish independence, the Royal Bank of Scotland said it would move its main office to London if Scotland voted to leave the UK. This would have meant that taxes would be paid mainly through the London company, affecting Scotland's income. However, Scotland voted to stay in the UK, so the headquarters remained in Edinburgh.
In 2017, it was reported that the Royal Bank of Scotland, along with other banks, had handled money from a large international money laundering scheme. The bank stated it was cooperating with investigations.
In 2020, the main company that owns the Royal Bank of Scotland, the Royal Bank of Scotland Group plc, changed its name to NatWest Group plc. This was to use the NatWest name, which is more widely known for most of its business.
Banknotes: Money Made in Scotland
For a long time, banks in Great Britain and Ireland could print their own banknotes. While the Bank of England eventually became the only bank to issue notes in England and Wales, Scottish banks kept this right. The Royal Bank of Scotland, along with Clydesdale Bank and Bank of Scotland, still prints its own banknotes today.
Scottish banknotes are used widely in Scotland and the rest of the UK. They are accepted as a way to pay, even though they are not officially "legal tender" like Bank of England notes. In fact, no paper money is legal tender in Scotland, not even Bank of England notes.
New "Fabric of Nature" Banknotes (Since 2016)
Since May 2020, the Royal Bank of Scotland has been replacing its older banknotes with a new series made of polymer (a type of plastic). These new notes are called the "Fabric of Nature" series.
The first polymer note was the £5 note, which came out in October 2016. It features Nan Shepherd, a Scottish writer, on the front, along with a quote from her book 'The Living Mountain'. The Cairngorms mountains are in the background. On the back, you can see two mackerel fish and a line from a poem by Sorley MacLean.
The £10 polymer note came out in 2017. It shows Mary Somerville, a Scottish scientist, on the front, with a quote from her work. Burntisland beach is in the background. The back of the note has two otters and a line from a poem by Norman MacCaig.
Older "Ilay" Banknotes (Before 2022)
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Before the new polymer notes, the Royal Bank used the "Ilay" series of banknotes. These were named after Lord Ilay, the bank's first governor, whose picture was on every note. This image was based on a painting from 1744.
The front of these notes also showed a picture of Dundas House, the bank's headquarters in Edinburgh. The background design on both sides of the notes was a star pattern. This pattern came from the beautiful ceiling of the banking hall in the old headquarters building.
On the back of these notes, there were pictures of different Scottish castles:
- £1 note: Edinburgh Castle
- £5 note: Culzean Castle
- £10 note: Glamis Castle
- £20 note: Brodick Castle
- £50 note: Inverness Castle (added in 2005)
- £100 note: Balmoral Castle
The "Ilay" series notes were taken out of circulation on September 30, 2022.
Special Commemorative Banknotes
Sometimes, the Royal Bank of Scotland prints special commemorative banknotes. These notes celebrate important events or famous people. The Royal Bank was the first British bank to do this in 1992. These special notes are very popular with collectors and don't stay in circulation for long.
Some examples include:
- A £1 note for a meeting of the Council of the European Union in 1992.
- A £1 note to mark 100 years since the death of writer Robert Louis Stevenson (1994).
- A £1 note to celebrate 150 years since the birth of Alexander Graham Bell (1997).
- A £20 note for the 100th birthday of Queen Elizabeth The Queen Mother (2000).
- A £5 note honoring golfer Jack Nicklaus during his last Open Championship at St Andrews (2005).
- A £1 note for the opening of the Scottish Parliament (1999).
- A £50 note for the opening of the bank's new headquarters in Gogarburn (2005).
- A £10 note to celebrate the Diamond Jubilee of Elizabeth II (2012).
- A £5 note to celebrate the Ryder Cup golf tournament.
What Services Does the Bank Offer?
The Royal Bank of Scotland offers many banking and insurance services. These are for regular people, small businesses, and large companies. Besides traditional branches, you can also bank by phone or online. Since 1946, the Royal Bank of Scotland has also used "mobile branches." These are converted vans that travel to serve people in rural areas. There are currently 19 of these mobile branches.
The bank is regulated by important authorities like the Prudential Regulation Authority and the Financial Conduct Authority. It also takes part in the Faster Payments Service, which helps payments go through quickly.
In 2006, the Royal Bank of Scotland was the first in Europe to test PayPass contactless debit and credit cards. These cards let you pay for things up to £30 by just tapping your card on a special machine. To make banking safer online, the bank also introduced small hand-held devices in 2007. You use these with your card to approve online transactions.
The Royal Bank of Scotland is part of several important banking groups. These include the Cheque and Credit Clearing Company and Bankers' Automated Clearing Services. It is also a member of the Financial Ombudsman Service, which helps resolve complaints.
The Bank's Look: Branding and Logo
The Royal Bank of Scotland Group uses a special logo that was created when it merged with the National Commercial Bank of Scotland in 1969. The logo is an abstract symbol of four arrows pointing inwards. It's known as the "Daisy Wheel." This design is based on 36 piles of coins arranged in a square, which represents how the bank helps to gather and grow wealth. The "Daisy Wheel" logo was also used by other banks that were part of the Royal Bank of Scotland Group, like Ulster Bank and Citizens Financial Group.
From 2003, the bank started using "RBS" more often instead of its full name, "The Royal Bank of Scotland." This was to help it seem like a global bank, not just a national one. However, the full name still appeared on bank signs. In 2014, the full bank name returned to advertising, and in 2016, the bank confirmed it would use its full name for its business in Scotland again. This was to help distance the bank from its past global expansion plans.
The Royal Bank of Scotland has also sponsored sports teams. It sponsored the Williams F1 racing team from 2005 to 2010. They also supported tennis player Andy Murray since he was 13 years old.
Images for kids
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The Royal Bank of Scotland logo.
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Dundas House in Edinburgh, the bank's registered office.
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The Bank of Scotland's headquarters, a rival in early history.
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A Royal Bank of Scotland branch building in London.
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A branch of the Royal Bank of Scotland in Islington, London.
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A map showing the international locations of the Royal Bank of Scotland.
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A Royal Bank of Scotland £5 note from 1964.
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The £5 polymer banknote, the first of its kind from RBS.
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A £100 Royal Bank of Scotland note from the "Ilay" series.
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The star-design ceiling of the Edinburgh banking hall, featured on older banknotes.
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A Royal Bank of Scotland "mobile bank" unit.
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The RBS logo with Scottish Gaelic text in Portree.
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Royal Bank of Scotland mortgage centre in Inverclyde.
