NatWest ridicules Bank of Scotland over link with American evangelist
Sir David Rowland, NatWest's chairman and chief executive, raised the heat of the exchanges between the pair, attempting to ridicule BoS's ill-fated link-up with Pat Robertson, the US evangelist.
In an 18-page release that will be posted to NatWest shareholders today, NatWest argues that the pounds 1.015bn cost-savings promised by BoS could not be realised. "Bank of Scotland's plans reveal a dangerous blend of hubris and parochialism. In our opinion, these plans, particularly in the IT area, would require something akin to divine intervention to succeed - which the Bank of Scotland has sought in the past, without success."
Earlier this year, BoS said it would form a telephone banking joint venture with Mr Robertson but withdrew after the preacher described Scotland as a "dark land" dominated by homosexuals.
Ron Sandler, NatWest chief operating officer, said that yesterday's release put more flesh on its initial defence, which was released on 27 October. The NatWest release said that BoS had "hijacked" pounds 510m in cost-savings already set to be delivered by NatWest initiatives, including an 11,650 headcount reduction.
It argued that BoS had not taken into account the potential loss of business that could follow a BoS victory as operations were re-modelled. And it queried the proposed pounds 290m savings the Scottish bank promised to deliver in IT. "If they go slashing branches, I can tell you now that there will be substantial lost business," Mr Sandler said.
The document said that BoS's IT plans were vague, and had been formulated without comprehensive knowledge of the current NatWest system, undermining their credibility.
Mr Sandler said that the asset-disposal programme outlined by NatWest had attracted substantial interest. Bank of Ireland confirmed yesterday that it had put in a bid for Ulster Bank, one of the NatWest units on the block, in a joint approach with Irish Life & Permanent.
BoS quickly issuing an eight-page rejoinder. Peter Burt, group chief executive, stood by the pounds 1.015bn savings target, saying that it represented "the minimum we believe that we can achieve".
NatWest shares fell 18p to 1397p, while BoS ended 4.5p weaker at 727.5p.
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