Royal Bank of Scotland Group Plc Chief
Executive Officer Fred Goodwin said European banks need to combine
to compete with U.S. competitors that are getting bigger.
“There’s a great disparity between the largest players and
many of the others,” Goodwin, 45, said in an interview. Cross-
border mergers in Europe won’t “happen tomorrow or the day after.
But the pressure is growing rather than abating.”
The Edinburgh-based bank, which has announced 11 acquisitions
since January 2003, is currently not in talks with anyone about
expanding its business in Germany, Goodwin said. Royal Bank of
Scotland’s main strength has been internal growth “and it’s
important that we retain that focus,” he said.
Goodwin joins other executives that have said that European
banks may become takeover targets as U.S. rivals combine. J.P.
Morgan Chase & Co., the second-biggest U.S. bank, earlier this year
agreed to buy Bank One Corp. for $55.1 billion. The purchase came
three months after Bank of America Corp.’s $48 billion purchase of
FleetBoston Financial Corp.
German Finance Minister Hans Eichel yesterday renewed the
government’s call on banks to combine to create a national banking
“champion” to help protect against foreign takeovers.
Royal Bank of Scotland expects to boost full-year pretax
profit by 10 percent as income grows faster than costs, Goodwin
said, reiterating a statement he made earlier this month.
“Things are moving ahead and in line with expectations,” he
said.
Bloomberg News
