The Clydesdale, the Glasgow based lender currently owned by reluctant parent NAB, is planning a £2.5 billion stock market float providing the Australian parent lender an exit opportunity. Or a partial exit anyway. The UK Times reports today that the UK bank, with over 300 branches and 3 million clients, will be independent for the first time in nearly 100 years with a successful stock market float.
However, much like the big City names, Clydesdale still is subject to misconduct fines relating to PPI. As such, NAB is providing a £1.7 billion indemnity for such charges to hopefully clear the way for a successful float. This episode provides further preliminary evidence of the concept of global banking franchises, with Australian banks owning subsidiaries in the UK as one example, having apparently a limited future. Thank goodness the Clydesdale has a brand and a base to build a successful mid-market retail bank. Although as noted in earlier posts relating to the US market consolidation phase underway for mid tier banks, the big have scale and the small are nimble, but medium size lenders can be a challenging position for some.
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