We'll become new home to Scottish banks, says Newcastle leader

Businesses ready to quit Scotland after independence referendum could come to Newcastle, says city council leader

Cllr Nick Forbes, Leader of Newcastle Council
Cllr Nick Forbes, Leader of Newcastle Council

Newcastle is ready to cash in Scottish independence - by inviting Scottish businesses frightened by a “yes” vote to move to the North East.

City council leader Nick Forbes said a Scottish breakaway could provide an economic windfall for the region.

There was no reason for firms to move to London when it would be cheaper and easier to move to Newcastle instead, he said.

Coun Forbes revealed he had been approached by one Scottish-based bank which said “it wasn’t entirely fanciful that they would move a significant part of their operations out of Scotland south of the border”.

Employers based in Scotland “might feel that they want to move out of an independent Scotland because they prefer the security of being part of a larger Britain.

“Newcastle in those circumstances will be well placed to be the headquarters of organisations which are currently based in Scotland,” he said.

Scottish firms would find it easier to relocate staff to the North East than to order them to move to London, Coun Forbes said.

“Edinburgh is only 90 minutes away by train, it is within easy commuting distance,” he said.

The Labour council leader added: “If there is an independent Scotland, I am not prepared to see Newcastle simply become a distant remote outpost of a London-run government.

“If that means we are more assertive about the opportunities for business location then that is something that we will be doing.”

The Scottish independence campaign has been hit by warnings from Scottish-based banks that they will move their headquarters or parts of their operations to England if Scotland votes to go.

Lloyds Banking Group, which includes Halifax, Bank of Scotland and Scottish Widows, said it has plans in place to set up new “legal entities” in England if the Yes campaign is victorious.

Royal Bank of Scotland, which has been based in Scotland since 1727, followed suit today by saying that it would be necessary to re-domicile the Bank’s holding company and its main operating entity to England.

Clydesdale Bank, which is part of National Australia Bank, also said its contingency plans for a ‘Yes’ vote included re-registering the Bank as an English company in order to mitigate risks and provide increased certainty for customers.

Chief executive David Thorburn said: “We have strong roots in Scotland and we remain fully committed to our customers, staff and the communities in which we operate.

“Any change to the company’s legal structure would have no impact on the vast majority of the bank’s staff.

“Clydesdale Bank would continue to serve its customers just as it has since 1838 and Glasgow will continue to be the bank’s key operational centre.”

Edinburgh-based TSB, which recently returned to the London stock market after two decades, said it will establish additional legal entities in England.

The wider group is already registered in England but the banking operation is in Scotland, where it has 189 of its 631 branches and almost 2,000 staff.

Coun Forbes said the Scottish debate suggested the North East had been wrong to reject a directly-elected regional assembly, in a referendum in 2004.

He said: “I think people will look back at that result with hindsight as the wrong result for our region.

“We could have been the first properly-devolved region within the UK.”


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