Card Issuer Profile: RBS

RBS is one of the oldest banks in the UK. Since its acquisition of NatWest in 2000, it has embarked on a program of international expansion and, outside of the UK, now operates in the US, Europe and Asia Pacific. This profile focuses primarily on RBS's card operations, providing an overview of its current market positioning and outlook for the future.



Report Highlights

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Overview 1
Catalyst 1
Summary 1

RBS 5
Key findings 5
Company overview 5
Background 5
Ownership and management 6
RBS board of directors 6
Employees 7
Management values 7
Company structure 8
Retail Markets is comprised of four divisions 9
Geographic coverage 10
RBS has expanded internationally through a combination of organic growth, acquisition and strategic partnerships 10
Card statistics 14
Number of debit cards in issue 14
Number of credit cards in issue 14
Key financials 17
Profit and loss account 17
Balance sheet 19
Card product offering 20
RBS introduced a new pricing program on UK credit cards in 2007 20
RBS was the first to introduce contactless technology on payment cards in the UK 24
RBS trials mobile payments in the UK 24
RBS launches mobile banking service 25
Distribution 25
Company outlook 25
RBS has adopted a vast multi-brand strategy in its cards business 25
Joint venture partnerships have proved to be a success and should be considered in the medium term 26
RBS has a strong position in the UK but the market conditions are difficult 27
The combination of RBS with ABN AMRO's Client Business Units provides RBS with a platform to grow its credit card offerings further 27
Outside the UK, RBS has scope to grow consumer businesses within Europe 28
However, both Santander and Fortis will strengthen their position in the retail banking market in Europe 28
There is an opportunity to grow in the rest of Europe, where credit card penetration is low 29
Latin and North America: There is potential to grow credit card business in the Americas 29
Asia-Pacific: the potential to build credit card business across the region is significant 30
It seems that RBS will use its position in China to expand further into the region 30
Datamonitor Competitor Benchmark 31
APPENDIX 34
Definitions 34
Co-branded card 34
Commercial card 34
Contactless card 34
Corporate card 34
Credit card 34
Private label card 34
Purchasing cards 35
Supplementary data 35
Methodology 37
Further reading 38
Ask the analyst 38
Datamonitor consulting 39
Disclaimer 39

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Table 1: RBS board of directors and executive committee details, 2008 6
Table 2: RBS group global employees by function, 2002-06 7
Table 3: Timeline of RBS's major market entry and expansion activities, 2000-07 11
Table 4: Retail markets and Citizens were the second and fourth largest contributors to the group's profit, respectively, in 2007 18
Table 5: A selection of RBS credit card offering in the UK, 2008 21
Table 6: A selection of RBS credit card offering in the US, 2008 23
Table 7: Scorecard logic, part one 32
Table 8: Scorecard logic, part two 33
Table 9: RBS debit cards in issue by geography, 2006 35
Table 10: RBS credit cards in issue by geography, 2006 35
Table 11: RBS credit card balances outstanding by geography, 2006 36
Table 12: The revenues, costs and net profits of the RBS group, 2003-07 36
Table 13: RBS balance sheet, 2002-06 37
Table 14: Current relevant Datamonitor publications, 2008 38
Table 15: Future relevant Datamonitor publications, 2008 38


Figure 1: RBS's credit card operations are concentrated in the following countries around the globe, 2008 10
Figure 2: The UK is the largest market, with 78.1% of RBS's total issued debit cards in 2006, 2002-06 14
Figure 3: RBS had 14.5 million credit cards in issue in 2006, 2002-06 15
Figure 4: The value of balances outstanding was €17.6 billion in 2006, 2002-06 16
Figure 5: RBS has demonstrated strong financial performance during 2003-07 17
Figure 6: RBS has a large balance sheet, 2003-07 19
Figure 7: RBS's competitor benchmark 31

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