ANL Abbey Nat.

RNS Number:7716C
Banco Santander Central Hispano SA
09 September 2004


   NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR FROM THE UNITED
                  STATES OF AMERICA, CANADA, AUSTRALIA OR JAPAN
                                     

Statement by Banco Santander Central Hispano, S.A. ("Banco Santander") regarding
 the placing of ordinary shares in The Royal Bank of Scotland Group plc ("RBS")
             by Banco Santander and its strategic alliance with RBS
                                        

Banco Santander announces that Merrill Lynch International has been instructed
to place, on its behalf, up to 79,000,000 ordinary shares of 25p each in RBS
with institutional investors. These shares may include 10,000,000 shares to be
sold under an over-allotment option. The shares being placed represent up to
approximately 2.51 per cent. of the issued ordinary share capital of RBS.
Following the share placing, Banco Santander will hold not less than 79.8
million ordinary shares in RBS (representing approximately not less than 2.54
per cent. of the issued ordinary share capital of RBS). Banco Santander will use
the proceeds of the placing for general corporate purposes. Banco Santander has
agreed not to sell any further shares in RBS for a period of 90 days after
completion of the share placement, except with the prior consent of the placing
bank. A further announcement will be made in due course on completion of the
placing.

If the proposed recommended acquisition by Banco Santander of Abbey National plc
("Abbey") becomes effective, Banco Santander and RBS have agreed to amend
certain aspects of the strategic alliance arrangements (the "Strategic
Arrangements") entered into between them in 1988 relating to co-operation in
banking and financial services activities in Europe. As part of the Strategic
Arrangements, each of Banco Santander and RBS undertook to invest in each
other's share capital and to appoint representatives to each other's board of
directors. The cross-directorships would be terminated if the acquisition of
Abbey by Banco Santander becomes effective. Banco Santander and RBS have also
agreed that until the proposed acquisition of Abbey has been completed or
terminated, their respective representatives on the board of directors of the
other will not attend any board meetings of the other. These changes were
reflected in Banco Santander's notification of the proposed acquisition of Abbey
to the European Commission which was filed on 13 August 2004.

Commenting on today's announcement, Sr. Emilio Botin, Chairman of Banco
Santander, said

"We have enjoyed a strategic alliance with RBS for more than 15 years but, as
has been the case for some time, the size of our respective cross shareholdings
are no longer critical to our relationship. We have therefore decided to reduce
our shareholding in RBS at this time to enhance our capital flexibility.

Our alliance has historically always included cross-directorships but both we
and RBS have recognised that these would be inappropriate in the event that
Banco Santander's agreed offer for Abbey is successfully concluded. Accordingly,
we have agreed that the cross-directorships between RBS and Banco Santander
would cease in those circumstances as would any special arrangements with regard
to joint ventures and commercial co-operation."

Formal documents relating to the recommended acquisition of Abbey by Banco
Santander are expected to be sent to Abbey shareholders this month.

The securities referenced herein have not been and will not be registered under
the U.S. Securities Act of 1933, as amended (the "Securities Act"), and may not
be offered or sold in the United States or to, or for the account or benefit of,
U.S. persons absent registration or an applicable exemption from the
registration requirements of the Securities Act. This announcement does not
constitute an offer of securities for sale in the United States or in any other
jurisdiction.

Stabilisation/FSA

Enquiries:

Banco Santander:
Keith Grant (Head of International Media)           +34 91 289 5206
Peter Greiff (Deputy Head of International Media)   +34 91 289 5207

The Maitland Consultancy:                           +44 20 7379 5151
Angus Maitland
Martin Leeburn
Philip Gawith




                      This information is provided by RNS
            The company news service from the London Stock Exchange

END
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