RBS and Lloyds surge as Scotland rejects independence
19 September 2014
Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc rose after Scots voted to stay in the UK, avoiding months of turmoil that might have seen major lenders move from Scotland to England, Forbes reported.
About 55 per cent of voters rejected independence (See: Relief for Cameron as Scotland decides against separation).
RBS shot up 3.1 per cent to 368.2 pence in London trading, adding to its weekly gain at 5.3 per cent. Lloyds was up 2.1 per cent to 77.43 pence, and TSB Banking Group Plc rose 2.3 per cent to 293 pence. The UK pound also rose.
Contingency plans to move to England are ''no longer required,'' RBS said in a statement today. RBS and Lloyds, both Edinburgh domiciled, said last week they would move to England if Scots opted to dissolve the 307-year-old union.
According to analysts' estimates a move south might have cost each lender as much as £1 billion.
''It is business as usual for all our customers across the U.K.,'' RBS said in an e-mailed statement.
According to Lloyds it remained focused on supporting households and businesses in Scotland and the rest of the UK.
It was the biggest share gain for RBS since it posted almost doubled first-half profit on 25 July.
Meanwhile, Bloomberg News said it had been an invigorating process that had achieved two things: greater powers for Scotland, if not formal independence; and a great demonstration of how democracy worked in a mature economy.
Every vote equal, the vast majority of the population turned out to express a view on a complex but vital idea, as both sides promised to respect the more popular view; which was a pleasure to see it at work.
Meanwhile the pound hit a two-year high against the euro early this morning and was likely to go higher through the day.
Clearly, investors wanted the UK to stay together, though early signs indicated a return to business as usual.
The market had already more or less anticipated a move against independence, and the rally looked like a relief rally presenting opportunities for investors in the short term.