Royal Bank of Scotland has drawn up plans to shift its head office from Scotland – where it has been based since 1727 – in the event that next week’s independence referendum backs a break away from the rest of the UK. The announcement followed news that Lloyds Bank would also move its head office to England and a warning that mortgage lenders are preparing to restrict lending in the event of a yes vote as concerns deepen over the currency that an independent Scotland would use. The moves by the banks, which received £65 billion of taxpayer bailouts in 2008 and 2009, follows a warning by Standard Life that it would shift business to England. The Bank of England governor Mark Carney said Scotland had contingency plans in the face of concerns about capital flight from the country and indicated that a Scottish central bank could need at least 25%, and possibly more than 100%, of the nation’s GDP in reserves if it decides to use sterling after independence without the support of Westminster. The precise amount of reserves needed to back an independent Scotland will depended on the size of the banking sector, at least 10 times the size of Scottish GDP.
