Royal Bank of Scotland would leave if Yes side wins

The Royal Bank of Scotland has said it will move its headquarters to London if Scotland votes to break away from the United Kingdom.

Lloyds Banking Group, owner of Halifax and Bank of Scotland, also confirmed it will move its legal entities to Britain if the Yes campaign succeeds.   The smaller Clydesdale Bank has also announced plans to relocate south of the border to mitigate risks.

Pensions and insurance giant Standard Life has also advised investors it is “planning for new regulated companies in England to which we could transfer parts of our business if there was a need to do so.”

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The news intensified worries about the potential economic costs of ending the union between Scotland and the U.K.

In a letter to staff, the RBS CEO Ross McEwan said there was no intention to move operations or jobs or to change the banking services the company offers.

'A technical procedure'

"This is a technical procedure regarding the rotation of our registered head office based on our current strategy and business plan. It is not an intention to move operations or jobs,” McEwan said.

"Our current business in Scotland, including the personal and business bank, IT and operations, human resources and many other functions, are here because of the skills and knowledge of our people, and the sound business environment.

"So far, I see no reason why this would change should we implement our contingency plans."

 Alex Salmond, who is fronting the Yes campaign, dismissed the warnings as "scare-mongering."

He also accused the British Treasury of breaching financial rules because it briefed journalists about RBS's plans ahead of the market announcement.

Fears of economic turmoil

But in new indications of the economic turmoil that might follow a dissolution of Scotland’s 307-year union with Britain, supermarket Asda and department store John Lewis said publically that Scottish shoppers might face higher prices if the Yes side wins.

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 "It does cost more money to trade in parts of Scotland and therefore those hard costs, in the event of a Yes vote, are more likely to be passed on," said John Lewis Partnership chairman Charlie Mayfield.

The British pound has suffered sharps swings in value this week after a poll showed a narrow majority for Yes voters. Stocks exposed to the Scottish market were also hammered.

Until recently a vote for independence was dismissed as a highly unlikely outcome – but the Yes campaign has momentum as the vote nears. Almost 4.3 million people have registered to vote, the largest electorate ever for a ballot in Scotland.

RBS majority owned by U.K. taxpayers

The pro-independence campaign argues that Scotland could sustain itself economically, but their opponents — including many businesses in Scotland — have focused on the uncertainties.

RBS is a key employer in Scotland, but is majority owned by the British taxpayer as it needed a government bailout in 2008 that it has not yet recouped.

Parent company Lloyds also is partly owned by the U.K. government. A Lloyd's spokesman said it had been contacted by customers and stakeholders concerned about its substantial operations in Scotland.