RBS Hands Rare Gift To Westminster Politicians

Bail-outs, mis-selling scandals, lavish bonuses: for most of the six years that RBS (LSE: RBS.L - news) has been majority-owned by British taxpayers, it has caused the UK Government a succession of headaches.

Now (NYSE: DNOW - news) , with a week to go before Scotland votes on independence, it could prove to be an unlikely ally of those same politicians who are campaigning to preserve the Union.

The bank's announcement that it will move its legal headquarters to England in the event of a Yes vote arguably provides a significant boost to those who oppose Scottish secession.

The announcement, cobbled together after a hastily convened board meeting on Wednesday, was no surprise: RBS had flagged the likelihood of such a move in previous statements.

"There are a number of material uncertainties arising from the Scottish referendum vote which could have a bearing on the bank's credit ratings, and the fiscal, monetary, legal and regulatory landscape to which it is subject," RBS said.

But its timing, alongside similar statements by Lloyds Banking Group, TSB and Clydesdale - owned by National Australia Bank - threatens to deflate the argument of Alex Salmond that an independent Scotland need be no less heavyweight an economy.

RBS employs 11,500 people in Scotland - many of them at the Edinburgh headquarters which became a symbol of the bank's reckless expansion under Fred Goodwin, its former chief executive.

Some of those jobs would inevitably move south, though how many, RBS declined to say on Thursday.

For Lloyds, its even larger Scottish workforce would predominantly stay put, since its operational headquarters have been in London for more than a century.

Nonetheless, for Mr Salmond, whose campaigning successes in recent days have left the prize of independence tantalisingly close, the departure of Lloyds and RBS represent an undeniable blow.