rembrandt, page-17

re: here's your announcemnt (mon morn) Hmmm ... should be seen as a positive.

NAB sale of Irish banks could be good news for Clydesdale

MARK WILLIAMSON September 13 2004

NATIONAL Australia Bank has decided to sell the two banks it owns in Ireland to raise funds to reinvest in its under-performing Clydesdale subsidiary and Yorkshire Bank.
According to a report in the Sunday Times, NAB, which is reeling from the results of a foreign exchange scandal and boardroom upheaval, will start the process to sell National Irish Bank and Northern Bank this month.
With reports of the planned withdrawal from Ireland following hot on the heels of news of a major investment by NAB in Clydesdale's Glasgow base, they will encourage hopes that the group has decided to commit to its Scottish subsidiary.
The fact this had performed poorly in recent years, when it struggled to keep up with the Yorkshire operation, had led some to believe it was a prime candidate for a sale to raise funds to protect NAB's core Australian operations.
However, Lazard, the investment bank that has been helping John Stewart, chief execut-ive of NAB, complete a strategic review of its European operations, will instead issue an information memorandum to potential bidders for the Irish banks this month.
With at least one of the irish operations likely to attract interest from Royal Bank of Scotland or HBOS, five banks have already indicated an interest in the sale, according to the Sunday Times.
Irish Life & Permanent has showed its hand, expressing an interest in bidding for National Irish Bank, centred in the republic.
This could be a fit for Royal Bank's expanding Ulster Bank and First Active operations, but has been dogged by contro-versy in recent years. Up to 19 former NIB executives faced the possibility of criminal charges after a devastating report published in July revealed widespread tax evas-ion and overcharging.
Northern Bank is strong in Northern Ireland.
A spokesman for NAB Europe declined to comment.
NAB's decision to give Clydesdale backing to open 30 to 40 sophisticated banking centres in England over the next three years has been seen as a significant victory for David Thorburn, chief operation officer of the subsidiary.
It signals that NAB sees scope to try to win share in the key business banking market in England from rivals, including HBOS, which is reported to be gearing up to launch a hostile £10bn bid for Abbey, possibly as soon as this week.
The Observer said James Crosby, chief executive of HBOS, would respond to any move by rival Santander to post details of its recommended all-share bid, worth around £8.7bn, for Abbey by calling a board meeting to rubber-stamp a counter-bid.
Crosby would be likely to receive unanimous support for an offer valuing Abbey at £10.5bn. However, the Observer said unnamed sources thought HBOS might make any offer conditional on it not being referred to competition authorities.
In the event of a referral, Crosby would walk away but could still succeed in forcing Santander to pay more for Abbey, leaving the Spanish bank with less money to invest in growing the operation.
Separately, the Sunday Telegraph reported HBOS would try to minimise the chances of any bid being referred to the commission by arguing that a takeover of Abbey by it would be good for competition and customers.
HBOS was planning to commit to pass on some of the cost-savings that would result from a takeover to customers.
Analysts believe that, to-gether with revenue synergies, these could total around £700m annually.
Santander is believed to be preparing to send its offer document to Abbey shareholders this week.

The Herald
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Cheers ... tight stops.


This is only my view ... read the red stuff.