RBS gets waiver from tougher U.S. capital rules
LONDON, Jan 14 (Reuters) - British state-backed lender Royal Bank of Scotland has been granted a waiver by the U.S. Federal Reserve from onerous new rules coming in next year for big overseas banks.
RBS (LSE: RBS.L - news) , which has dramatically shrunk in size since needing a taxpayer bailout in 2008 that has left the UK government owning 80 percent of the company, plans to reduce its U.S. assets to below $50 billion by the time the new rules come into force.
The rules will apply to all overseas banks with over $50 billion of U.S. assets. It will require firms such as Deutsche Bank and Barclays (LSE: BARC.L - news) to set up separate U.S. holding companies with strict capital and reporting requirements.
The Fed said in a notice on its website that it had approved RBS's request for a waiver from the requirement to form the U.S. intermediate holding company by July 2016. (http://www.federalreserve.gov/releases/h2/20141220/default.htm)
The Fed did not give a reason for its decision.
RBS sold 29 percent of its U.S. bank Citizens (NYSE: CIA - news) in September and plans to cut its stake further this year. It is also shrinking its U.S. investment bank, with the aim of getting its U.S. assets to below $50 billion.
It is part of a scaling back in the Edinburgh-based bank's overseas operations. RBS grew to become one of the world's biggest banks before the 2007/09 financial crisis, but is now focusing on its core UK retail and corporate customers. (Reporting by Steve Slater; editing by Keith Weir)