Weakening European market and recession like condition in the domestic market has blown the expectation of RBS attempt to strengthen its capital base and emerge from worsening financial performance, reports Financial Times.
The deal was finalized in August 2010, on the condition of profitability of the business, which consists of 318 branches and more than 2 million retail and small business customers.
The business, however, failed to revive itself, and consequently, the £1.65bn priced deal which included a £350m premium over the value of the business, is expected to be deducted on completion.
The bank said the terms have not yet been approved and any deduction in the price will vary on the strength of the business at the time of completion.
The deal which is expected to complete by the end of 2012, believed to run into 2013, while RBS has benefited from higher than expected profits from the business.
