RBS spreads into US card market

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RBS spreads into US card market

NEW YORK, US - Royal Bank of Scotland has taken its first step into the US credit card business with a $2.7 billion (£1.5 billion) deal.

RBS, owner of Nat West, swooped yesterday for the People's Bank of Connecticut, paying $360 million, on top of $2.3 billion in receivables - the amount that customers owe on their plastic.

RBS chief executive Fred Goodwin said that the deal was “an ideal platform for expansion in the US through existing relationships and the development of other partnerships and channels".

"This tactical acquisition of a premium credit card portfolio represents a low-risk entry to the important US market, positioning us well for growth," Mr Gooodwin continued.

People's Bank, which was established in 1985, employs around 540 people with a particular focus on California, New York, Florida, Texas and Pennsylvania. No job losses are expected.

RBS expects to close the deal within the next two months, subject to approval from regulators.

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