Royal Bank of Scotland

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Royal Bank of Scotland (RBS)


Presented for the award of M.A

International Business Management

I hereby declare that this dissertation is all my own work, except text:

Signature: _____________________ Date : ____ / ____ / _____


These papers discuss about one of the world’s largest banks Royal Bank of Scotland (RBS) Group. The discussion highlights the main strategies of Royal Bank of Scotland (RBS) group all over the world and also the analysis of these strategies whether these were successful or not. What was the effect of Royal Bank of Scotland’s strategies on their business and on upcoming years. This overall study also covers the Michael Porter Theory to make its business strategy analysis.

Table of Contents
Reasons of this study:5
1. Introduction:6
1.1 History:6
1.2 Strategies:6
2. Bank of China:7
2.1 Acquisition:7
2.2 General Analysis:8
2.3 Porter’s Theory analysis:8
3.1. Acquisition:9
3.2. General Analysis:9
3.3. Porter’s theory analysis:10
4. Minimizing the assets:10
4.1. Insurance line:10
4.2. General Analysis:10
4.3. Porter’s Theory Analysis:11
5. Investment in UAE:11
5.1. Launch of Credit Cards:11
5.2. General Analysis:11
5.3. Porter’s Forces Analysis:11
6. Retail and Commercial Banking:12
6.1. Investment:12
6.2. General Analysis:12
6.3. Porter’s Forces Analysis:12
7. International network and infrastructure:13
7.1. Investment:13
7.2. General Analysis:13
7.3. Porter’s Theory Analysis:13
8. Merchant Acquiring:13
8.1. Investment:13
8.2. General Analysis:14
8.3. Porter’s Forces Analysis:14
9. Raising Capital:14
9.1. Rights Issue and ADR:14
9.2. General Analysis:15
9.3. Porter’s Theory Analysis:15
10. Islamic Banking:15
10.1. Innovation:15
10.2. General Analysis:15
10.3. Porter Theory Analysis:16
11. Group Size Reduction:16
11.1. Selling Weaker Operations:16
11.2. General Strategy:16
11.3. Porter’s Theory Analysis:17
12. Toxic Assets:17
12.1. Writing-off Assets:17
12.2. General Analysis:17
12.3. Porter’s Forces Analysis:17
13. Reduction in Work Force:18
13.1. Firing 9000 Employees:18
13.2. General Strategy:18
13.3. Porter’s Forces Analysis:18
14. Incentives:18
14.1. Performance Related Bonuses:18
14.2. General Analysis:19
15. Conclusion:19
16. References:21
17. Diagram:26

Reasons of this study:

The study is concerned about the strategic initiative analysis taken by Royal Bank of Scotland. The bank is under study due to following reasons • One of the largest bank of United Kingdom
• Operating successfully in 22 countries with substantial profits and ROE (about 20%). • Acquisition of large groups of the world like ABN AMRO, Bank of China etc. • Upt0 15% participation in GDP of countries like China, U.S, Germany, France, Russia etc. • Strong distribution channel segregated region wise.

• Strong blend of different cultures due to work force from different ethnicities and cultures.

1. Introduction:

1.1 History:

Royal Bank of Scotland (RBS) is one of the leading banks in world known for their risk management and corporate development. Royal Bank of Scotland was founded in 1727 but first branch was opened in fast growing trading city of Glasgow in 1783, its first office was opened in London in 1874 and expanded into England in 19th century. Innovation is an important value creation tool of the company as it was the first bank ever to offer the overdraft facility in 1728. In the twentieth century it spread out rapidly, getting hold of several English...
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