The Scotsman - Business - How Royal Bank came back from the brink

Two of my favorite (or would that be favourite?) business writers - Bill Jamieson and Martin Flanagan of The Scotsman - take a look at how the Royal Bank of Scotland went from being essentially broke in 1992 to being a world giant today (bigger than Ford, General Motors, McDonald’s and Nike combined, according to these reporters).

They also provide a glimpse at its early history:

IT IS an intense rivalry rooted deep in history. The hostility between the Royal Bank of Scotland and its arch-enemy Bank of Scotland dates back to the very foundation of the Royal in 1727. It came into being because the Bank was thought to have Jacobite tendencies and dirty tricks were never far from the surface in the early days.

A favourite ruse was to stockpile the rival’s notes, then present them in vast quantities for cash "payment on demand". The aim was to induce bankruptcy and the Royal proved the more adept at the scam, forcing the Bank to close for several months in 1728.

This ushered in a ferocious competitiveness between the pair which peaked with the epic battle for NatWest in 1999. The fight was ultimately won by the Royal, a victory all the more remarkable considering it had been on the verge of disaster less than a decade earlier...

File under: Project Columbus, banking, business coups, old boys' networks, Scotland.