Bank of New York/Royal Bank of Scotland Trust Bank - Banking

Background

Acquisition by BNY International Financial Corporation (BNY), belonging to the Bank of New York, of the Royal Bank of Scotland Trust Bank, a wholly owned subsidiary of the Royal Bank of Scotland. The BNY group provides a broad range of banking and financial services. It has subsidiaries and branches in the UK, Belgium and Germany, and Luxembourg. The Royal Bank of Scotland Trust Bank operates in the provision of custody and investment administration services and treasury dealing in the UK for domestic and foreign entities, carried out at its main operating subsidiary Trust Bank. It also carries out this type of activity in Luxembourg for Luxembourg-based funds. The areas in which the activities of the parties overlap are those of (i) custodian services and (ii) the administration of funds, which involves the provision of accounting services and net asset value calculations.

Assessment

The only area of overlapping activities in which, after the operation, the BNY group would have a 15% share or more is that of the provision of domestic custodian services to a variety of investment institutions in respect of UK assets. Given the level of the combined share of the BNY group and Royal Bank of Scotland Trust Bank in this market in the UK, and given the presence of several other significant operators a few of which have a comparable or even higher share, the Commission considered that the operation would neither create nor strengthen a dominant position in the UK market for custodian services. (Case n° COMP/M.1618, Decision of 25/08/99).