Page 298 - Bank Case Studies

The fifth and final requirement was the divestment of

Williams & Glyn (W&G). W&G was due to be sold to a

competitor or set up as a standalone bank. Neither

happened.

The £835m fund (initially thought to be £750m in February

2017) (9), announced by the government in July, 2017 was

set up as part of RBS’ state aid commitments to increase

competition in business banking by encouraging more

business customers to switch accounts to eligible challenger
banks.

However, the creation of the Challenger Fund formed the

basis of a new agreement in relation to RBS’s remaining

State Aid commitments and replaced the existing

requirement to divest Williams & Glyn which had to be

completed by 31 December 2017. (15)

Pester confirmed TSB would attempt to win a grant from the

£835m "Challenger Fund" (8) set up by RBS to encourage

more competition in the UK banking business lending

market saying:

"If we get one of the bigger grants from RBS then

we will use every penny of it to help support small

businesses and to make it as uncomfortable as

possible for the big five."

The fund is open only to banks with a balance sheet of less

than £350bn in the UK.