Exclusive: RBS restructuring chief to shrink investment bank
By Michelle Price, Matt Scuffham and Steve Slater
LONDON/HONG KONG (Reuters) - Royal Bank of Scotland (RBS.L: Quote) will hand restructuring chief Rory Cullinan the task of overseeing another major scaling back of its investment bank, sources told Reuters, allowing it to focus on lending to British households and businesses.
Cullinan will take over responsibility for RBS's investment bank from Donald Workman, currently executive chairman for corporate and institutional banking, the sources said. It is not clear what role Workman will take.
Cullinan already runs RBS's internal 'bad bank' and is overseeing the sale of its U.S. business Citizens and its Williams & Glynn business in Britain.
The bank, 79 percent-owned by the government, is under pressure from lawmakers to do more to support the domestic economy.
Chief Executive Ross McEwan said last year that he wanted to increase the proportion of assets that RBS holds in Britain to 80 percent of its global business from 60 percent at present.
Cullinan was appointed to run RBS's 'bad bank' in December 2013. He is on track to sell or wind down the majority of the 38 billion pounds ($58.6 billion) of unwanted assets placed within it by the end of 2015, a year ahead of schedule and his success in that role has persuaded McEwan to enlarge his remit, the sources said.
"He’s been phenomenal," said Bernstein analyst Chirantan Barua. "Given his experience and what he’s delivered, I would not be surprised at all that Ross gives him something more. What is next in line in terms of cutting is the investment bank."
The bank hopes that slimming down and simplifying its business will enable it to bolster its capital and generate better returns, making it more attractive to investors and easier for the government to return to private ownership. Continued...