TNAG-2474-FCO40-3604-Business-matters-in-Hong-Kong-acquisition-of-Midland-Bank-by-1992 — Page 114

PRIVATE AND CUNE LUENTAARAA

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mpetition from other UK banks

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There have also been new domestic entrants to various sectors of the UK market. Girobank, established in the late 60s, had a relatively slow start but now has a significant franchise in the money transmission sector. The bank has managed to exploit successfully its unique link with Post Office Counters and the pay-outs of Government social security and other payments. Office Counters for example took £47bn of transactions on behalf of Girobank in 1991. It now has a 3.4% share of total bank accounts compared to only 1.6% in 1981.

Post

12 Originally a group of savings banks, the TSB has offered chequeing accounts and loans in direct competition with the principal clearing banks following the gradual deregulation of its activities from the mid-1970s onwards. It also operates the UK's fifth largest branch network. One of the objectives of this process was the desire to provide another force to compete with the clearing banks. TSB Group is estimated to have about 2% of the UK corporate loan market, with a greater proportion in the small and medium-sized corporate sector.

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Other well-established domestic UK retail banks have also

The Scottish been challenging the Big Four on their own ground.

banks have expanded in recent years, primarily south of the border. The Bank of Scotland has increased its retail outlets by 120 since 1982 to 670 today. It has also opened 'business centre' branches to cater for corporate customers and, as an alternative, is seeking to penetrate the small business sector via its embryonic (and successful) Home and Office Banking Services and now has roughly 3% of the small business market. In addition, it has trebled its lending to 'English' customers to £9bn over the

last 6 years.

14 The Royal Bank of Scotland strengthened its position by absorbing the Williams & Glyn's branch network (some 300 branches) which expanded its branch network by 60%. This expansion was further consolidated by expanding its branch network in the Midlands and South: about 50 branches were opened in the period 1985-91 and this process is continuing.

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