Bank of Scotland

Article Abstract:

Bank of Scotland is competing against Royal Bank of Soctland to acquire NatWest, and may lose the bid. Bank of Scotland is one of the best performing banks in Britain and is growing rapidly. Direct selling has helped to cut costs, and the bank also focuses on specialist services. The bank has a benign history of bad debts but this may not continue in a future recession. It is unclear whether the bank could be a bid target, and it can be recommended on its fundamentals.

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Bank of Scotland

Article Abstract:

Bank of Scotland holds a stake of some 7% in the British markets, and has controlled costs well. HSBC Securities rates the bank's stocks a hold, Fox-Pitt, Kelton rates them attractive, and Credit Lyonnais rates them an add.

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What's so good about the Bank of Scotland?

Article Abstract:

The Bank of Scotland has made a bid for NatWest, and has promised to deal with NatWest's problems, yet the Bank of Scotland's own record should be examined. The bank has grown its balance sheet rapidly, so income has grown faster than costs, but Bank of Scotland's cost growth has not been especially low, so there is no guarantee that it would control NatWest's costs. Bank of Scotland has managed to avoid a number of problems through caution, and has expanded by using direct selling which has meant that an expensive network of branches was not needed.

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