[Magdalen] An Independent Scotland?

[Roger Stokes]

On 12/09/2014 23:17, Roland Orr wrote:
> The Bank of England, obviously, will N0T support Scotland. Some UK 
> banks will move out of Scotland.
> Roland

Scotland will need a central bank to act as lender of last resort for 
other banks in that country.  It will need sufficient reserves to enable 
it to function in that way.  Until the Scottish Parliament can furnish 
it with those reserves it will need to borrow them from elsewhere and 
the Bank of England is the obvious source.

Three Scottish banks are authorised to issue their own bank notes, which 
are backed by deposits held in the Bank of England.  They are the Bank 
of Scotland, which is part of the Halifax Bank of Scotland group whose 
operational headquarters are Halifax, West Yorkshire, England.  It is 
part of the Lloyds Group which has said it will head South in the event 
of a "Yes" vote.  The Royal Bank of Scotland's majority shareholder is 
the UK government.  The Clydesdale Bank's owners are even further away - 
the National Australia Bank Group.

As these are all joint stock banks they cannot act as a central bank.

Roger