NatWest bond brokers press RBS to rethink sale plans

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The Independent Online

Chip Kruger and Gary Holloway, the co-heads of Greenwich, National Westminster Bank's derivatives and bond-broking business, are pressing NatWest's new owners, the Royal Bank of Scotland, to rethink plans to sell its US business.

Staff at Greenwich have been told that they will hear on Monday what has been decided about their fate. However, that announcement may now be subject to delay.

Mr Kruger and Mr Holloway are understood to have asked Ian Robertson, RBS's head of Corporate Banking, to consider splitting the business on product lines, rather than on a geographic basis. They fear that this will damage the integrity of the business, upset clients and prompt a walk-out of key staff, destroying the value of the business before it is sold.

The two Greenwich heads are understood to have been in negotiations with the Royal Bank of Canada and one other bidder, who are believed to have been willing to buy several of the specialist teams in the riskier business areas, and leave the rest of the more standard business with NatWest. However, these talks were suspended a fortnight ago after the Royal Bank of Scotland took control.

The preference of Mr Kruger and Mr Holloway, who sold the business, founded in Greenwich, Connecticut, to NatWest four years ago, would ideally prefer the Royal Bank of Scotland to either sell the business outright or to keep it as a whole.

However, senior management at Greenwich accept that a "U" turn on this scale would be hard for RBS or its shareholders to swallow, particularly as Sir George Mathewson, the Royal Bank of Scotland chief executive, needs some "quick wins" to re-assure City sceptics about his ability to deliver the promised £1.2bn in cost savings from the NatWest takeover.

RBS committed itself in its offer document for NatWest to split Greenwich, selling on the US business, and folding in the remainder into a new refocused corporate business, whose principal focus will be to serve clients.

Greenwich insiders maintain that this plan, which was devised without consultation, betrays a profound misunderstanding of the Greenwich business.

Some of the irritation surfaced at an off-site meeting held for Greenwich staff at the Barbican Centre in London, at which they were treated to a series of presentations by their new bosses. After the meeting, one insider commented: "Their attitude is that they have taken us over and therefore they should run things. However, this business is unlike anything they have encountered before."

Similar frustrations are emerging on the RBS side. Said one RBS insider: "There are people who are trying to throw their weight around."