Major franchise in the U.K. and the northeastern U.S.; Good business diversification and strategic flexibility; Successful acquisition and integration strategy; and Superior profitability and efficiency. Capital more tightly managed compared with that of peers; and Growth strategy carries some execution risk. The ratings on Royal Bank of Scotland Group PLC (RBSG)--the ultimate holding company of The Royal Bank of Scotland PLC (Royal Bank; AA/Stable/A-1+) and National Westminster Bank PLC (NatWest; AA/Stable/A-1+)--reflect very strong profitability, good risk management, and strong business positions (achieved as a result of successful acquisitions, mainly in the U.S. and U.K., and good groupwide organic momentum). RBSG's successful integration of NatWest (acquired in 2000), and expansion of its insurance operations, means that it enjoys a prominent position
