British Banks Warn They'll Head South If Scotland Quits UK
Three British banks said they would relocate to London if Scotland were to break away from the United Kingdom, a setback for supporters of independence with the vote just a week away.
The announcements by Edinburgh-based Lloyds and Royal Bank of Scotland – both part-owned by the UK government – and by the Australian owners of Clydesdale bank followed a new opinion poll that showed defenders of the centuries-old union were slightly ahead.
A weekend survey had given the 'yes' campaign its first lead this year, prompting the leaders of Britain's three main political parties to clear their diaries and travel north in a bid to persuade voters that Scotland would gain more autonomy if it rejected independence.
The sudden prospect of a Scottish breakaway so close to the Sept. 18 referendum has prompted a rush to action this week by Britain's political and business elite: oil firms Shell and BP have also expressed concern.
In another blow to the independence campaign influential newspaper The Scotsman decided to back staying in Britain.
Lloyds bank, which is 25 percent-owned by the UK government and controls Bank of Scotland, said its contingency plans included setting up “legal entities in England”, a move that would not affect its business.
RBS said it “would be necessary to re-domicile the bank's holding company.”
TSB Banking Group, which is part-owned by Lloyds, said it was likely to relocate some operations to England.
The thought of their departure caused little heartache in some quarters.
“I would rather be poor and standing on my own two feet, making my decisions about my country, than being ripped off by robber barons in Westminster,” said Daniel Hargreaves, a 'yes' voter from Edinburgh – rushing to work in the city center – who said he was an RBS customer until two years ago.
John Swinney, finance minister in the nationalist-led Scottish government, told BBC radio that the announcement by the banks was a result of the refusal by Britain's government to agree to a formal currency union with an independent Scotland.
Bank of England Governor Mark Carney has raised questions about currency arrangements in an independent Scotland, saying the country would need stockpiles of sterling if it adopted the pound without an agreement with the rest of the United Kingdom.
That could threaten the spending promises of Scottish National Party leader Alex Salmond, who wants a deal to share the pound and the Bank of England with the rest of the UK. Britain's main political parties have ruled that out.
Salmond, asked by a reporter about business leaders' concern about independence, accused the UK government of orchestrating a campaign among corporate leaders to talk negatively about independence.
“I think the people of Scotland have moved beyond these warnings and these scaremongerings,” he told a news conference.
There was some relief for unionists when a poll released on Wednesday evening showed 53 percent of Scots would vote against a split, against 47 percent intending to opt for independence.
The figures from the poll, carried out by Survation for the Daily Record newspaper, were unchanged from its last survey on Aug. 28. They excluded 10 percent of voters who said they were still undecided.
Until a few weeks ago the “No” campaign had been comfortably ahead according to several polling companies.
Financial markets have also seen an impact from worries about Scotland breaking away.
Investors fear the effect on Britain of Scotland claiming much of the North Sea oil and gas reserves. The balance of political power in Britain – and its future membership of the European Union are also in the balance.
The cost of hedging against sharp swings in the British pound ahead of the Scottish referendum in a week's time jumped to 13-month highs.
Thursday marks the anniversary of the 1997 referendum in which Scots voted for their current devolved administration.