Formation of Jt.Venture Co

ROYAL BANK OF SCOTLAND GROUP PLC
14 July 1999
                                       
THE ROYAL BANK OF SCOTLAND GROUP plc ('ROYAL BANK GROUP') FORMS JOINT VENTURE
WITH BANK OF SCOTLAND

Royal Bank Group announces that it has today completed the formation with Bank
of Scotland ('BoS') of a joint venture company to be called Caledonian Capital
Limited ('Caledonian Capital').

Caledonian Capital, which will be owned by Royal Bank Group and BoS in the
proportions of 50 per cent each, will act as the sole arranger for both
institutions for underwriting debt transactions in the EU, principally in
respect of LBO's, in deals where the need for senior debt is in excess of £100
million and/or where the total consideration is more than £150 million.

This market place is one in which neither Royal Bank Group nor BoS is
currently a participant and it is their intention that Caledonian Capital will
actively target high value LBO transactions both in the UK and continental
Europe. As before, Royal Bank Group and BoS will continue to act independently
of and compete with each other in relation to lower value transactions.

Commenting on the transaction Sir George Mathewson, Group Chief Executive of
Royal Bank Group, said: 'Caledonian Capital will be a significant new
participant in an area where neither Royal Bank Group nor the Bank of Scotland
is currently a player by bringing together the strength, market driven
approach and innovation of both institutions to debt transactions of this
size.'.


For further information contact:

Leith Robertson, Head of the Leveraged  Finance
Group, The Royal Bank of Scotland plc             Tel: [phone]