IMPORTANT NOTICE

      IMPORTANT: You must read the following disclaimer before continuing. The following disclaimer applies to the attached preliminary prospectus supplement and the accompanying prospectus accessed from this page or otherwise received as a result of such access, and you are therefore advised to read this disclaimer page carefully before reading, accessing or making any other use of the attached preliminary prospectus supplement and the accompanying prospectus. In accessing the attached preliminary prospectus supplement and the accompanying prospectus, you agree to be bound by the following terms and conditions, including any modifications to them from time to time, each time you receive any information from us as a result of such access.

      Confirmation of Your Representation: You have been sent the attached preliminary prospectus supplement and the accompanying prospectus on the basis that you have confirmed to one of Merrill Lynch, Pierce, Fenner & Smith Incorporated, Greenwich Capital Markets, Inc., Morgan Stanley & Co. Incorporated, UBS Securities LLC, Wachovia Capital Markets, LLC, Banc of America Securities LLC, Lehman Brothers Inc. or RBC Dain Rauscher Inc., as the case may be, being the sender of the attached, that you consent to delivery by electronic transmission.

      This preliminary prospectus supplement and the accompanying prospectus have been sent to you in an electronic form. You are reminded that documents transmitted via this medium may be altered or changed during the process of transmission and consequently none of Merrill Lynch, Pierce, Fenner & Smith Incorporated, Greenwich Capital Markets, Inc., Morgan Stanley & Co. Incorporated, UBS Securities LLC, Wachovia Capital Markets, LLC, Banc of America Securities LLC, Lehman Brothers Inc., RBC Dain Rauscher Inc., The Royal Bank of Scotland Group plc or any person who controls any of them or any director, officer, employee or agent of any of these, or any affiliate of any such person, accepts any liability or responsibility whatsoever in respect of any difference between the preliminary prospectus supplement and the accompanying prospectus distributed to you in electronic format and the hard copy version available to you on request from Merrill Lynch, Pierce, Fenner & Smith Incorporated, Greenwich Capital Markets, Inc., Morgan Stanley & Co. Incorporated, UBS Securities LLC, Wachovia Capital Markets, LLC, Banc of America Securities LLC, Lehman Brothers Inc. or RBC Dain Rauscher Inc., as the case may be.

      You are reminded that the attached preliminary prospectus supplement and the accompanying prospectus have been delivered to you on the basis that you are a person into whose possession this preliminary prospectus supplement and the accompanying prospectus may be lawfully delivered in accordance with the laws of the jurisdiction in which you are located, and you may not nor are you authorized to deliver this preliminary prospectus supplement and the accompanying prospectus to any other person.

      Restrictions: Nothing in this electronic transmission constitutes an offer to sell securities or a solicitation of an offer to buy securities in any state where the offer or sale is not permitted.

Filed pursuant to Rule 424(b)(2)

Registration Statement No. 333-123972

58,000,000 American Depositary Shares, Series T

The Royal Bank of Scotland Group plc

Representing

58,000,000 Non-cumulative Dollar Preference Shares, Series T

(Nominal value of U.S.$.01 each)

         We are issuing non-cumulative Dollar Preference Shares, Series T, or Series T preference shares, which will be sold in the form of American Depositary Shares, Series T, or Series T ADSs.

         Dividends on the Series T preference shares will accrue from the date of issue thereof (the “issue date”). We may pay dividends out of our distributable profits in U.S. dollars quarterly in arrears on March 31, June 30, September 30 and December 31 of each year commencing on December 31, 2007, at the rate of 7.25% per annum, or $0.4531 quarterly, per Series T preference share. Therefore, dividends payable for the initial long dividend period will be $0.4733 per Series T preference share. We may redeem the Series T preference shares, at our option, in whole (but not in part) on any business day that falls on or after December 31, 2012 at a redemption price of $25.00 per Series T preference share plus the dividends otherwise payable for the then-current dividend period accrued to, but excluding, the redemption date.

         If we are wound up or liquidated, you will be entitled to receive a liquidation preference of $25.00 per Series T preference share plus accrued dividends for the then-current dividend period (accrued to, but excluding, the date of payment), but only after we have paid all of our debts and other liabilities to our creditors and to holders of any of our capital shares that are senior to the Series T preference shares.

         We will apply for listing of the Series T ADSs on the New York Stock Exchange under the symbol “RBS Pr T”. Trading of the Series T ADSs is expected to begin within approximately 30 days after the initial delivery of the ADSs.

         Investing in the Series T preference shares or Series T ADSs involves risks. See “Risk Factors” beginning on page S-5.

         Neither the Securities and Exchange Commission (“SEC”) nor any state securities commission has approved or disapproved of these securities or determined that this prospectus supplement and accompanying prospectus are truthful or complete. Any representation to the contrary is a criminal offense.

        We have granted the underwriters the option to purchase up to 8,700,000 additional Series T preference shares in the form of Series T ADSs at the public offering price less the underwriting discount, within 30 days from the date of this prospectus supplement, to cover over-allotments, if any. Any additional Series T preference shares issued after the issue date of the 58,000,000 Series T preference shares shall accrue dividends with effect from such date.

         We expect that the Series T ADSs will be ready for delivery in New York, New York on or about September 27, 2007.

Merrill Lynch & Co.

September 20, 2007

TABLE OF CONTENTS

Prospectus Supplement

      You should rely only on the information contained or incorporated by reference in this prospectus supplement and the accompanying prospectus. We have not, and the underwriters have not, authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not, and the underwriters are not, making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information in this prospectus supplement, the accompanying prospectus and the documents incorporated by reference herein or therein is accurate only as of their respective dates. Our business, financial condition, results of operations and prospects may have changed since those dates.

ABOUT THIS PROSPECTUS SUPPLEMENT

      In this prospectus supplement, we use the following terms:

FORWARD-LOOKING STATEMENTS

      From time to time, we may make statements regarding our assumptions, projections, expectations, intentions or beliefs about future events, including statements relating to the Transaction and the pro forma financial information included in this prospectus supplement. These statements constitute “forward-looking statements” for purposes of the Private Securities Litigation Reform Act of 1995. We caution that these statements may and often do vary materially from actual results. Accordingly, we cannot assure you that actual results will not differ materially from those expressed or implied by the forward-looking statements. You should read the sections entitled “Forward-looking statements” in our Annual Report on Form 20-F for the year ended December 31, 2006 and in our Form 6-K with our interim financial results for the six months ended June 30, 2007, which are incorporated by reference.

      We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, forward-looking events discussed in this prospectus supplement and/or the accompanying prospectus or any information incorporated by reference, might not occur.

WHERE YOU CAN FIND MORE INFORMATION

      We file annual, semiannual, and special reports and other information with the Securities and Exchange Commission, which we refer to as the SEC. You may read and copy any document that we file with the SEC at the Public Reference Room, 100 F Street, N.E., Room 1580, Washington, D.C. 20549, USA. You can call the SEC on 1-800-SEC-0330 for further information on the Public Reference Room. The SEC’s website, at http://www.sec.gov, contains reports and other information in electronic form that we have filed.

      The SEC allows us to incorporate by reference in our prospectus the information that we file with the SEC. This permits us to disclose important information to you by referring to certain previously-filed documents. We incorporate by reference (i) our Annual Report on Form 20-F for the year ended December 31, 2006, which we filed with the SEC on April 24, 2007 and (ii) a Form 6-K with our interim financial results for the six months ended June 30, 2007, which we furnished to the SEC on August 15, 2007. See also “Where You Can Find More Information” and “Incorporation of Documents by Reference” in the accompanying prospectus.

USE OF PROCEEDS

      We will use the net proceeds from the sale of the Series T preference shares, estimated to be approximately $1,404,000,000 after the deduction of estimated fees and expenses, to fund in part the cash portion of the Offer attributable to RBSG, to strengthen our capital base and for general corporate purposes.

      We may issue other securities, including preference shares, in connection with financing the Offer attributable to RBSG.

RISK FACTORS

      Investing in the securities offered using this prospectus supplement and accompanying prospectus involves risk. You should carefully consider the following factors and the other information in this prospectus supplement, the accompanying prospectus and the documents incorporated by reference herein before deciding to invest in the Series T ADSs or Series T preference shares. If any of these risks occurs, our business, financial condition, and results of operations could suffer, and the trading price and liquidity of the Series T ADSs or Series T preference shares could decline, in which case you could lose part or all of your investment.

Risks Related to Our Business

      Set out below are certain risk factors which could affect our future results and cause them to be materially different from expected results. Our results could also be affected by competition and other factors.

      Our performance is influenced by economic conditions particularly in the United Kingdom, United States and Europe. Downturns in these economies could result in a general reduction in business activity and a consequent loss of income for us. It could also cause a higher incidence of credit losses and losses in our trading portfolios. Geopolitical conditions can also affect our earnings. Terrorist acts and threats and the response of governments in the United Kingdom, United States and elsewhere to them could affect the level of economic activity. Our business is also exposed to the risk of business interruption and economic slowdown following the outbreak of a pandemic.

      Risks arising from changes in credit quality and the recoverability of loans and amounts due from counterparties are inherent in a wide range of our businesses. Adverse changes in the credit quality of our borrowers and counterparties or a general deterioration in the United Kingdom, United States, European or global economic conditions, or arising from systemic risks in the financial systems, could affect the recoverability and value of our assets and require an increase in our provision for impairment losses and other provisions.

      The most significant market risks we face are interest rate, foreign exchange and bond and equity price risks. Changes in interest rate levels, yield curves and spreads may affect the interest rate margin realized between lending and borrowing costs. Changes in currency rates, particularly in the sterling-dollar and sterling-euro exchange rates, affect the value of assets and liabilities denominated in foreign currencies and affect earnings reported by our non-U.K. subsidiaries, mainly Citizens, RBS Greenwich Capital and Ulster Bank, and may affect income from foreign exchange dealing. The performance of financial markets may cause changes in the value of our investment and trading portfolios. We have implemented risk management methods to mitigate and control these and other market risks to which we are exposed. However, it is difficult to predict with accuracy changes in economic or market conditions and to anticipate the effects that such changes could have on our financial performance and business operations.

      Future claims in our general and life assurance business may be higher than expected as a result of changing trends in claims experience resulting from catastrophic weather conditions, demographic developments, changes in mortality rates and other causes outside our control. Such changes would affect the profitability of current and future insurance products and services. We re-insure some of the risks we have assumed.

      Our businesses are dependent on the ability to process a very large number of transactions efficiently and accurately. Operational losses can result from fraud, errors by employees, failure to document transactions properly or to obtain proper authorization, failure to comply with regulatory requirements and Conduct of Business Rules, equipment failures, natural disasters or the failure of external systems, for example, those of our suppliers or counterparties. Although we have implemented risk controls and loss mitigation actions, and substantial resources are devoted to developing efficient procedures and to staff training, it is only possible to be reasonably, but not absolutely, certain that such procedures will be effective in controlling each of the operational risks faced by us.

      We are subject to financial services laws, regulations, administrative actions and policies in each location in which we operate. This supervision and regulation, in particular in the United Kingdom and the United States, if changed, could materially affect our business, the products and services offered or the value of assets.

      We devote substantial management and planning resources to the development of strategic plans for organic growth and identification of possible acquisitions, supported by substantial expenditure to generate growth in customer business. If these strategic plans do not reach completion in a timely manner or on a cost effective basis or do not otherwise meet with success, our earnings could grow more slowly or decline.

      In the ordinary course of our business, legal actions, claims against and by us and arbitrations arise; the outcome of such legal proceedings could affect our financial performance.

      Our activities are subject to tax at various rates around the world computed in accordance with local legislation and practice. Action by governments to increase tax rates or to impose additional taxes would reduce our profitability. Revisions to tax legislation or to its interpretation might also affect our results in the future.

      Our businesses and earnings can be affected by the fiscal or other policies and other actions of various governmental and regulatory authorities in the United Kingdom, the European Union, the United States and elsewhere.

      There is continuing political and regulatory scrutiny of the operation of the retail banking and consumer credit industries in the United Kingdom and elsewhere. The nature and impact of future changes in policies and regulatory action are not predictable and are beyond our control, but could have an adverse impact on our businesses and earnings.

      In the European Union, these regulatory actions included an inquiry into retail banking in all of the then 25 member states by the European Commission’s Directorate General for Competition. The inquiry examined retail banking in Europe generally. On January 31, 2007, the European Commission announced that barriers to competition in certain areas of retail banking, payment cards and payment systems in the European Union had been identified. The European Commission indicated that it will use its powers to address these barriers and will encourage national competition authorities to enforce European and national competition laws where appropriate. Any action taken by the European Commission and national

competition authorities could have an adverse impact on our payment cards and payment systems businesses and on our retail banking activities in the European Union countries in which we operate.

      In the United Kingdom in September 2005, the Office of Fair Trading (“OFT”) received a super-complaint from the Citizens Advice Bureau relating to payment protection insurance, or PPI. As a result, the OFT commenced a market study on PPI in April 2006. In October 2006, the OFT announced the outcome of the market study and, on February 7, 2007, following a period of consultation, the OFT referred the PPI market to the U.K. Competition Commission for an in-depth inquiry. This inquiry could continue for up to two years. Also, in October 2006, the U.K. Financial Services Authority published the outcome of its broad industry thematic review of PPI sales practices in which it concluded that some institutions fail to treat customers fairly.

      In April 2006, the OFT commenced a review of the undertakings given following the conclusion of the Competition Commission Inquiry in 2002 into the supply of banking services to small and medium enterprises, or SMEs.

      The OFT has carried out investigations into Visa and MasterCard credit card interchange rates. The decision by the OFT in the MasterCard interchange case was set aside by the Competition Appeals Tribunal in June 2006. The OFT’s investigations in the Visa interchange case and a second MasterCard interchange case are ongoing. The outcome is not known, but these investigations may have an impact on the consumer credit industry in general and, therefore on our business in this sector. On February 9, 2007, the OFT announced that it was expanding its investigation into interchange rates to include debit cards.

      On September 7, 2006, the OFT announced that it had decided to undertake an investigation of the application of its statement on credit card fees to current account unauthorized overdraft fees. The investigation was completed in March 2007. On March 29, 2007, the OFT announced its decision to conduct a formal in-depth investigation into the fairness of bank current account charges. On April 26, 2007, the OFT announced a formal market study into personal current accounts in the United Kingdom. The study will focus on the impact of free-if-in-credit current accounts on competition and whether they deliver value to consumers. The OFT expects to complete the market study by the end of 2007. In common with other banks in the United Kingdom, we have received claims from customers in respect of current account administrative charges. Our financial performance could be adversely affected if, by legal process or regulatory action, such charges are determined to be, in whole or in part, penalties or unfair.

      On January 26, 2007, the U.K. Financial Services Authority issued a Statement of Good Practice relating to Mortgage Exit Administration Fees. On March 1, 2007, the Group adopted a policy of charging all customers the fee applicable at the time the customers took out the mortgage. In addition, any customers who had previously been charged a higher fee than was applicable at the time they took out the mortgage and who complained were refunded the difference in fees. This approach was one of the options recommended by the U.K. Financial Services Authority.

      On April 26, 2007, the Office of Rail Regulation referred the leasing of rolling stock for franchised passenger services and the supply of related maintenance services in Great Britain to the U.K. Competition Commission for an inquiry lasting up to two years. The Group includes the Angel Trains group, a rolling stock leasing business operating in this market.

      On May 15, 2007, the Competition Commission published its final report into the supply of personal current account banking services in Northern Ireland. It is anticipated that a statutory instrument implementing the remedies set out in the report will be made in October 2007. The Group includes Ulster Bank, which is active in the Northern Ireland current account market.

      Other areas where changes could have an adverse impact include:

Risks Related to the Transaction

      The consummation of the Offer is subject to the satisfaction or waiver of certain Offer conditions, all of which, except for the minimum acceptance condition and the government and regulatory approvals conditions, must be either satisfied or waived prior to the expiration of the Offer period (as such Offer period may be extended in accordance with applicable law and regulation). These conditions include (i) acceptance of the Offer by the holders of at least 80% of the ABN AMRO ordinary shares, calculated on a fully diluted basis, (ii) the completion of the sale of LaSalle Bank Corporation (“La Salle”) and the retention of the proceeds therefrom within the ABN AMRO Group, (iii) the absence of a material adverse change in respect of the business, cash flow, financial or trading position, assets, profits, operational performance, capitalization, prospects or activities of either the ABN AMRO Group, RFS Holdings or any of the Consortium Banks, (iv) the absence of a material adverse change in national or international capital markets, financial, political or economic conditions or currency exchange rates or exchange controls, (v) the absence of material litigation or other proceedings, (vi) the absence of injunctions or other restrictions on the consummation of the Offer, (vii) the granting of all necessary regulatory approvals and (viii) the declaration by the European Commission that the concentrations resulting from the Transaction are compatible with the competition and antitrust rules of the common market (each Offer condition, an “Offer Condition” and, collectively, the “Offer Conditions”). There can be no assurance that any or all of the Offer Conditions will be satisfied or waived. In addition, the Offer is subject to a competing offer by Barclays plc (“Barclays”). There can be no assurance that the Offer will be consummated and the acquisition of the ABN AMRO Businesses will be completed.

      The Transaction will require various approvals or consents from, among others, the Dutch Central Bank, the U.K. Financial Services Authority, the Bank of Spain, the European Commission and various other antitrust authorities outside the European Union, other bank regulatory, securities, insurance and other regulatory authorities worldwide. The governmental entities from which these approvals are required, including the Dutch Central Bank, the U.K. Financial Services Authority, the Bank of Spain, the European Commission and others, may refuse to grant such approval, or, may impose conditions on, or require divestitures or other changes in connection with, the completion of the Transaction. These conditions or changes could have the effect of delaying completion of the Transaction, reducing the anticipated benefits of the Transaction or imposing additional costs on us or limiting our revenues following completion of the Transaction, any of which might have a material adverse effect on us following the Transaction. In order to obtain these regulatory approvals, the Consortium Banks may have to divest, or commit to divesting, certain of the businesses of ABN AMRO and/or the Consortium Banks to third parties. In addition, we may be required to make other commitments to regulatory authorities. These

divestitures and other commitments, if any, may have an adverse effect on our business, results of operations, financial condition or prospects after the completion of the Transaction.

      Certain jurisdictions claim jurisdiction under their competition or antitrust laws in respect of acquisitions or mergers that have the potential to affect their domestic marketplace. A number of these jurisdictions may claim to have jurisdiction to review the Transaction. Such investigations or proceedings may be initiated and, if initiated, may have an adverse effect on our business, results of operations, financial condition or prospects after the completion of the Transaction.

      Although ABN AMRO has provided the Consortium Banks with access to certain limited, high-level due diligence information, the information about ABN AMRO included in this prospectus supplement, including all ABN AMRO financial information, is derived from information made publicly available by ABN AMRO, including periodic and other reports which ABN AMRO has filed with or furnished to the SEC. While we have no knowledge that would indicate that any statements included in this prospectus supplement based upon information contained in such reports filed with or furnished to the SEC are inaccurate, incomplete or untrue, we were not involved in the preparation of such reports and, therefore, we cannot verify the accuracy, completeness or truth of the information obtained from such reports or any failure by ABN AMRO to disclose events that may have occurred, but that are unknown to us, that may affect the significance or accuracy of the information contained in such reports. In addition, given that ABN AMRO has provided the Consortium Banks only with limited access to ABN AMRO’s accounting records, we did not have the information necessary to verify independently certain adjustments and assumptions, and therefore did not verify such adjustments and assumptions, with respect to ABN AMRO’s financial information in preparing the pro forma financial information included in this prospectus supplement. Any financial information regarding ABN AMRO that may be detrimental to us (including, after the completion of the Transaction, the ABN AMRO Businesses) and that has not been publicly disclosed by ABN AMRO, or errors in the Consortium Banks’ estimates due to the lack of cooperation from ABN AMRO, may have an adverse effect on the benefits we expect to achieve in the Transaction.

      Uncertainty about the effects of the Offer and any competing offers on employees, partners, regulators and customers may materially and adversely affect the business and operations of ABN AMRO. These uncertainties could cause customers, business partners and other parties that have business relationships with ABN AMRO to defer the consummation of other transactions or other decisions concerning ABN AMRO’s business, or to seek to change existing business relationships with ABN AMRO. In addition, employee retention at ABN AMRO may be challenging until the Offer is completed.

      There is no assurance that our acquisition of the ABN AMRO Businesses will achieve the business growth opportunities, revenue benefits, cost savings and other benefits we anticipate. We believe the Offer consideration is justified in part by the business growth opportunities, revenue benefits, cost savings and other benefits we expect to achieve by combining our operations with the ABN AMRO Businesses. However, these expected business growth opportunities, revenue benefits, cost savings and other benefits may not develop and other assumptions upon which the Consortium Banks determined the Offer consideration may prove to be incorrect, as, among other things, such assumptions were based on publicly available information.

      In particular, the reorganization plan currently contemplated may have to be modified as a result of employee consultations and approvals, which may delay its implementation. We may also face challenges with the following: obtaining the required approvals of various regulatory agencies, any of which could refuse or impose conditions or restrictions on its approval; retaining key employees; redeploying resources in different areas of operations to improve efficiency; minimizing the diversion of management attention from ongoing business concerns; and addressing possible differences between our business culture, processes, controls, procedures and systems and those of the ABN AMRO Businesses that we will acquire. In addition, because the Consortium Banks have had access only to publicly available information regarding ABN AMRO’s tax situation and structure, unanticipated substantial tax costs may be incurred in the implementation of the reorganization plan.

      Although the Consortium and Shareholders’ Agreement provides a mechanism for assets to be re-allocated or transferred between the Consortium Banks where it is established that any asset is held by or will be held by the wrong Consortium Bank, disputes may otherwise arise in implementing the Consortium and Shareholders’ Agreement. Such disputes would be resolved in accordance with the dispute resolution processes set out in the Consortium and Shareholders’ Agreement. While these processes have been designed to resolve any disagreements swiftly, such disputes could result in delay to implementation of the reorganization.

      Under any of these circumstances, the business growth opportunities, revenue benefits, cost savings and other benefits anticipated by us to result from the reorganization may not be achieved as expected, or at all, or may be delayed. To the extent that we incur higher integration costs or achieve lower revenue benefits or fewer cost savings than expected, our results of operations, financial condition and the price of our securities may suffer.

      In making the Offer and determining its terms and conditions, the Consortium Banks have relied on publicly available information relating to ABN AMRO, including periodic and other reports for ABN AMRO, filed with or furnished to the SEC on Form 20-F and Form 6-K. The Consortium Banks have also conducted a due diligence review of limited additional information about ABN AMRO, although the information about ABN AMRO presented in this prospectus supplement is derived from publicly available information. This information in relation to ABN AMRO has not been subject to comment or verification by ABN AMRO, the Consortium Banks or their respective directors. As a result, after the completion of the Offer, we may be subject to unknown liabilities of ABN AMRO, which may have an adverse effect on our financial condition and results of operations.

      The Consortium Banks have had access only to publicly available information concerning ABN AMRO’s tax situation. It is possible that the consummation of the Offer may result in adverse tax consequences arising from a change of ownership of ABN AMRO and its subsidiaries. The tax consequences of a change of ownership of a corporation can lead to an inability to carry-over certain tax relief and other tax benefits, including, but not limited to, tax losses and tax credits. Moreover, a change of ownership may result in other tax costs not normally associated with the ordinary course of business. Such other tax costs include, but are not limited to, stamp duties, land transfer taxes, franchise taxes and other levies. In addition, consummation of the Offer will result in our becoming, through RFS Holdings, the holding company of ABN AMRO and certain of its subsidiaries. There are differences between the U.K. and Dutch tax regimes for holding companies. These differences could result in additional tax being paid in the United Kingdom in respect of the profits of the relevant businesses of ABN AMRO as a result of their acquisition by a U.K. resident company.

      ABN AMRO may be a party to joint ventures, licenses and other agreements and instruments that contain change of control provisions that will be triggered upon the completion of the Offer, upon RFS Holdings’ acquisition of ABN AMRO or upon completion of the reorganization of ABN AMRO as part of the Transaction. ABN AMRO has not provided the Consortium Banks with copies of any of the agreements to which it is party, and these agreements are not generally publicly available. Agreements with change of control provisions typically provide for or permit the termination of the agreement upon the occurrence of a change of control of one of the parties or, in the case of debt instruments, require repayment of all outstanding indebtedness. If, upon review of these agreements after completion of the Offer, the Consortium Banks determine that such provisions can be waived by the relevant counterparties, the Consortium Banks will consider whether to seek these waivers. In the absence of these waivers, the operation of the change of control provisions, if any, could result in the loss of material contractual rights and benefits, the termination of joint venture agreements and licensing agreements or the requirement to repay outstanding indebtedness.

      In addition, employment agreements with members of ABN AMRO senior management and other ABN AMRO employees may contain change of control provisions providing for compensation to be paid in the event the employment of these employees is terminated, either by ABN AMRO or by those employees, following the completion of the Offer, RFS Holdings’ acquisition of ABN AMRO or completion of the reorganization. Such employment agreements may also contain change of control provisions providing for compensation to be paid following the occurrence of such events even if the employment is not terminated. We have taken into account potential payments arising on the operation of change of control provisions, including compensation arising on change of control provisions in employment agreements but such payments may exceed our expectations.

Risks Related to the Series T ADSs and Series T preference shares

      Our board of directors or an authorized committee thereof (in either case referred to herein as the board of directors) may resolve, in its sole and absolute discretion, prior to the relevant dividend payment date not to pay in full or at all dividends on the Series T preference shares. To the extent that any dividend or part thereof is, on any occasion, not declared and paid by reason of the exercise of such discretion, holders of Series T preference shares or Series T ADSs shall have no claim in respect of such non-payment.

      In addition, such non-payment shall not prevent or restrict (a) the declaration and payment of dividends on any other series of our dollar preference shares or any of our non-cumulative preference shares expressed to rank pari passu with our dollar preference shares, (b) the setting aside of sums for the payment of dividends referred to in (a), (c) except with respect to share capital ranking after the Series T preference shares, the redemption, purchase or other acquisition of our shares by us, or (d) except with respect to share capital ranking after the Series T preference shares, the setting aside of sums, or the establishment of sinking funds, for any such redemption, purchase or other acquisition by us.

      If we do not make full payments in respect of certain other securities we have issued, including a number of series of our non-cumulative preference shares, we are not, under the terms of those securities, permitted to (i) pay dividends on the Series T preference shares until such time as we set aside an amount sufficient to pay in full amounts payable in respect of such securities on the next payment date(s) or (ii) redeem the Series T preference shares until such time as we have made full payments in respect of such securities for a period of 12 months.

      In addition to the discretion not to declare a dividend for any reason as described above, our board of directors will not declare and pay in full the dividends on any series of preference shares if, in the opinion of the board of directors, payment of the dividend would cause a breach of applicable capital adequacy requirements of the U.K. Financial Services Authority or if we do not have sufficient distributable profits.

      If our board of directors does not pay a dividend or any part thereof payable on a dividend payment date in respect of any Series T preference shares for any reason, then holders of such preference shares or Series T ADSs will have no claim in respect of such non-payment and we will have no obligation to pay the dividend accrued for the dividend period or to pay any interest on the dividend, whether or not dividends on the Series T preference shares are declared for any future dividend period. Holders of Series T preference shares or Series T ADSs will have no right to participate in our profits.

      If our financial condition were to deteriorate, you might not receive dividends on the Series T preference shares. If we liquidate, dissolve or wind up, you could lose all or part of your investment.

      Subject to certain conditions, including compliance with our Articles of Association, the provisions of the Companies Act 1985 (as amended) and all other laws and regulations applying to us and to the prior consent of the U.K. Financial Services Authority (if required), we may substitute the Series T preference shares in whole, but not in part, with Qualifying Non-Innovative Tier 1 Securities (as defined under “Certain Terms of the Series T Preference Shares — Substitution”). In issuing the Qualifying Non-Innovative Tier 1 Securities in substitution for the Series T preference shares, our board of directors or an authorized committee thereof will have discretion to determine whether the Qualifying Non-Innovative Tier 1 Securities have the same material terms as the Series T preference shares and will be under no obligation to seek the views or consult with the holders of such preference shares or other third parties. Holders of the Series T preference shares may be adversely affected by any such substitution.

      Prior to the offering, there has been no trading market for the Series T ADSs or Series T preference shares. We cannot assure you that an active or liquid market will develop or be sustainable for the Series T ADSs or Series T preference shares. Therefore, investors may not be able to sell their Series T preference shares or Series T ADSs easily or at prices that will provide them with a yield comparable to similar investments that have a developed secondary market. Illiquidity may have a material adverse effect on the market value of the Series T preference shares or Series T ADSs.

      The Preference Shares are expected, on issue, to be rated “Aa3” by Moody’s Investors Service, Inc. (“Moody’s”), “A” by Standard & Poor’s Rating Services, a division of the McGraw-Hill Companies, Inc. (“Standard & Poor’s”) and “AA” by Fitch Ratings Ltd. (“Fitch”). The ratings may not reflect the potential impact of all risks related to structure, market, the completion of the Transaction, additional factors discussed above and other factors that may affect the Preference Shares, including the effect of the Transaction on us after its completion. A rating is not a recommendation to buy, sell or hold securities and may be subject to suspension, reduction or withdrawal at any time by the assigning rating agency.

CAPITALIZATION OF THE GROUP

      The following table shows the Group’s authorized and allotted, called-up and fully paid share capital as at June 30, 2007.

      The authorized ordinary share capital of the Group as at June 30, 2007 was £2,879 million, consisting of 11,514 million ordinary shares of £0.25 each.

      The authorized preference share capital of the Group as at June 30, 2007 was £528 million, consisting of 419.5 million non-cumulative preference shares of $0.01 each, 3.9 million non-cumulative convertible preference shares of $0.01 each, 66 million non-cumulative preference shares of €0.01 each, 3 million non-cumulative convertible preference shares of €0.01 each, 900 million non-cumulative convertible preference shares of £0.25 each, 1 million non-cumulative convertible preference shares of £0.01 each, 0.9 million cumulative preference shares of £1 each and 300 million non-cumulative preference shares of £1 each.

      The allotted, called-up and fully paid preference share capital of the Group as at June 30, 2007 was £2 million, consisting of 244 million non-cumulative preference shares of $0.01 each, 1 million non-cumulative convertible preference shares of $0.01 each, 2.5 million non-cumulative preference shares of €0.01 each, 0.2 million non-cumulative convertible preference shares of £0.01 each and 0.9 million cumulative preference shares of £1 each.

      The following table shows the unaudited consolidated shareholders’ equity and indebtedness of the Group as at June 30, 2007 in accordance with International Financial Reporting Standards (“IFRS”).

      Under IFRS, certain preference shares are classified as debt and are included in subordinated liabilities in the table above.

      As at June 30, 2007, the Group had total liabilities and equity of £1,011 billion, including deposits by banks of £139 billion and customer accounts of £419 billion.

      All of the indebtedness described above or below, except for approximately £31.3 billion of debt securities in issue, is unsecured. None of the indebtedness described above or below is guaranteed.

      As at June 30, 2007, the Group had contingent liabilities including guarantees arising in the normal course of business totaling £20,629 million, consisting of guarantees and assets pledged as collateral security of £10,996 million and other contingent liabilities of £9,633 million.

      On July 6, 2007, RBS plc redeemed the $350 million and $500 million floating rate subordinated notes, which were included in our subordinated liabilities in the preceding capitalization table.

      On July 17, 2007, RBS plc redeemed the €130 million floating rate subordinated notes, which were included in our subordinated liabilities in the preceding capitalization table.

      Save as disclosed above, there has been no significant change in the contingent liabilities (including guarantees), total capitalization and indebtedness of the Group since June 30, 2007.

THE ABN AMRO OFFER

Overview of the Transaction

      On July 20, 2007, RFS Holdings, a company jointly owned by the Consortium Banks and controlled by RBSG, commenced the Offer, pursuant to which it will exchange for each ABN AMRO ordinary share and each ABN AMRO ADS validly tendered (i) €35.60 in cash and (ii) 0.296 newly issued RBSG ordinary shares.

      As at September 14, 2007, the latest practicable date prior to the date of this document, the total value of the Offer consideration was €69.9 billion, based on the closing price of £5.315 for the RBSG ordinary shares on the London Stock Exchange on that date and an exchange rate of €1.00 per £0.6894 published in the Financial Times on September 14, 2007. Under the Offer, we will contribute our consortium proportion of the consideration paid to ABN AMRO shareholders and ABN AMRO ADS holders of €26.2 billion. The consideration for the ABN AMRO Businesses net of the sale of LaSalle will be €15 billion. The reduction comprises $21 billion in proceeds from the sale of LaSalle less inter-company balances of $6 billion as set out in the Bank of America Agreement.

      The Offer is subject to certain conditions customary for transactions of this type, including a minimum acceptance condition of 80% of ABN AMRO ordinary shares and the sale of LaSalle to Bank of America Corporation, with the proceeds from such sale on completion being held by the ABN AMRO Group. Completion of the acquisition of ABN AMRO, should the Offer be successful, is expected to occur in the fourth quarter of 2007.

      In due course following completion of the Offer, RFS Holdings expects to implement an orderly separation of the business units of ABN AMRO whereby we are to acquire the following ABN AMRO business units as defined in ABN AMRO’s Annual Report on Form 20-F for the year ended December 31, 2006, filed with the SEC on April 2, 2007 (the “ABN AMRO 2006 Annual Report”) (the “ABN AMRO Businesses”):

      Certain other assets will continue to be shared by the Consortium Banks (the “Shared Assets”).

      The arrangements between Fortis, RBSG, Santander and RFS Holdings in relation to the Transaction are governed by the Consortium and Shareholders’ Agreement, which was entered into on May 28, 2007. The arrangements contemplated by the Consortium and Shareholders’ Agreement include:

      Pursuant to the Consortium and Shareholders’ Agreement, the Consortium Banks have agreed to subscribe for shares in RFS Holdings of a sufficient amount to fund the consideration due under the Offer. This funding commitment is split among the Consortium Banks as follows:

      Approximately 7% of RFS Holdings’ commitment will be satisfied by the issue of RBSG ordinary shares in connection with the Offer. Upon settlement of the Offer, the Consortium Banks will have shareholdings in RFS Holdings that are equal to their proportionate funding commitments.

Chronology of Key Events Relating to the Offer

      On May 29, 2007, the Consortium Banks confirmed the terms of a proposed offer for ABN AMRO, which terms reflected the uncertainty regarding the sale of La Salle to Bank of America.

      On July 16, 2007, following a ruling of the Dutch Supreme Court overturning an injunction preventing the sale of La Salle to Bank of America without a shareholder vote, the Consortium Banks issued an announcement confirming their intention to proceed with a revised proposed offer.

      On July 18, 2007, ABN AMRO issued a press release acknowledging receipt of the Consortium Banks’ revised proposed offer. In the press release, ABN AMRO confirmed it would discuss the revised proposed offer with the Consortium Banks, and that, under the terms of a merger protocol dated April 23, 2007 between Barclays and ABN AMRO, it would also discuss with Barclays its offer and the implications of the Consortium Banks’ revised proposed offer. ABN AMRO also confirmed that it would assess the proposed offers in a fair and transparent manner and that it had no intention of making any major asset disposals at that time.

      On July 20, 2007, RFS Holdings commenced the Offer on the terms described above.

      On July 30, 2007, ABN AMRO issued an offer update in which it announced that it was not in a position to recommend either the Offer or Barclays’ offer for ABN AMRO and that it would continue to engage with both parties with the aim of continuing to ensure a level playing field.

      On August 13, 2007, the Consortium Banks issued a press release announcing that their aggregate shareholding in ABN AMRO had been increased to 3.25% of voting rights through market purchases made between August 10, 2007 and August 13, 2007 of a total of 40.76 million ABN AMRO ordinary shares.

      On September 17, 2007, the Dutch Minister of Finance granted the Consortium Banks the “Declarations of No Objection” which they require in respect of the Offer. The Declarations of No Objection contain specific conditions and requirements. The Consortium Banks announced that they are confident that they can comply with these conditions and requirements.

ABN AMRO Businesses to be Acquired by RBSG

      The information in respect of the ABN AMRO Businesses set out below is based on publicly available information and limited information provided to us by ABN AMRO.

      For the purposes of this prospectus supplement, ABN AMRO’s Global Wholesale Businesses consist of Business Unit Global Clients, the wholesale clients in Business Unit Europe (excluding Antonveneta), the wholesale clients in Business Unit Asia, the continuing businesses of Business Unit North America, and wholesale clients in the Netherlands and Latin America (excluding Brazil); and ABN AMRO’s International Retail Businesses consist of the retail activities in Business Unit Asia and Business Unit Europe (excluding Antonveneta).

      ABN AMRO has a large wholesale banking business with a global footprint and corporate banking operations in 53 countries. In addition to established positions with large numbers of customer relationships in Europe and the United States, ABN AMRO is present in emerging markets through offices in 11 countries in Asia, five countries in Eastern Europe and seven countries in Latin America.

      ABN AMRO is one of a small number of banks with the global reach and product capability to be effective in international cash management, payments and trade finance. Through these transactional banking products, ABN AMRO has been able to establish large numbers of corporate and institutional customer relationships globally. However, we believe that many of these relationships are relatively under-developed, reflecting ABN AMRO’s insufficient strength in many of the financing and risk management products which are most relevant and complementary for these customers.

      In addition to its international activities with large corporate and institutional customers, ABN AMRO has extensive relationships with mid-corporate customers in Continental Europe, Asia and the Middle East.

      ABN AMRO’s Global Wholesale Businesses, which we will acquire, are those that constituted ABN AMRO’s Wholesale Clients Business Unit, or WCS, in 2005 (including the continuing businesses of Business Unit North America following the sale of LaSalle, and including the Netherlands, but excluding Brazil (other than Global Clients customers)) and the product capabilities serving wholesale clients within its Global Markets and Transaction Banking Product Business Units. In 2006, WCS customers were transferred to the regional Business Units, except for the largest customers which were maintained in ABN AMRO’s Global Clients Business Unit. In 2007, Global Clients customers have also been allocated to the regional Business Units. We estimate that ABN AMRO’s Global Wholesale Businesses generated income of €5,677 million and profit before tax of €630 million in 2006, on an IFRS basis.

      We believe that there is a strong strategic fit between our Global Banking & Markets business (“GBM”) and ABN AMRO’s Global Wholesale Businesses. GBM has considerable strength across a broad range of financing and risk management products and in 2006 had what we believe to be an industry leading cost to income ratio of 40%, reflecting deep client relationships and strong income per customer metrics. However, while GBM has been expanding its international reach in recent years, it still has limited presence outside major financial centers. The acquisition of ABN AMRO’s global branch network should enable GBM to accelerate this expansion relative to its current strategy, under which the establishment of a global branch network and customer base would take a significant period and would require significant investment.

      ABN AMRO’s considerable reach, through its global branch network, supports its strength in transactional products such as international cash management and trade finance. ABN AMRO is also strong in faster growth, but more specialized, areas including equity derivatives and emerging markets. However, we believe that ABN AMRO’s lack of depth and scale in some important products has led to relatively weak income per customer and per employee, resulting in a high estimated cost to income ratio for its Global Wholesale Businesses of 89% in 2006.

      Our relationship-driven model and focus on deepening customer relationships enable us to generate high levels of income from our customers. GBM believes that this revenue generation is significantly above the level achieved by ABN AMRO from its Global Clients franchise. For these equivalent customer groups, GBM estimates that it generated more than 50% higher income per customer than ABN AMRO and more than 150% higher income per front office employee than ABN AMRO.

      We expect that we will be able to deepen customer relationships and increase revenues per customer and per employee across ABN AMRO’s extensive base of large and mid-corporate customers. To achieve this, GBM will apply its relationship-driven model in which relationship managers are enabled and incentivized to deliver the bank’s full range of products and services from debt capital markets to cash management. Our model focuses on the overall profitability of customer relationships and encourages a collaborative approach

between relationship and product teams. The model is supported by clear client and revenue accountabilities, transparent incentives for collaboration, a focus on higher value added income streams and a simple organization structure which encourages the development of cross-product customer solutions.

      In addition to the application of our relationship management model, GBM expects to be able to create additional value from ABN AMRO’s customer franchise through leveraging its strengths in the product areas that are both most relevant to large corporate and institutional customers and which offer the highest value revenue streams, for example in structured finance, risk management and securitization. GBM believes that it brings the requisite scale and strength in these key product areas that ABN AMRO currently lacks.

      We expect that the combined business will have product leadership across a broad range of corporate banking products, benefiting from the complementary and overlapping product strengths of GBM and ABN AMRO. Based on 2006 data, the combined business will rank third in all bonds and loans globally, first in global securitizations, global project finance and all international bonds, second in emerging markets syndicated credits, third in foreign exchange and fifth in international cash management. We also expect it to be a leading player in the global interest rate derivatives market, where GBM has had particular success in the distribution of sophisticated risk management products to its large and mid-corporate customers.

Notes:

      We believe that the combined business will be well diversified by geography across the United Kingdom, the rest of Europe, the United States and Asia-Pacific, with a small contribution from Latin America. Within these regions, we anticipate that the combined business will have considerable local presence through which to distribute its strong and broad product offering.

      In Europe, including the United Kingdom, we expect that the combined business will consolidate its position as the leading wholesale and fixed income bank. GBM will apply its relationship model and product strengths to deepen ABN AMRO’s extensive franchise in Continental Europe with large corporates and financial institutions, while ABN AMRO’s international cash management, payments and trade finance products will enable GBM to enhance its customer relationships. ABN AMRO’s local presence is expected to enable GBM to extend from the largest corporates and financial institutions to the middle market, and to

extend geographically into fast growing markets in Eastern Europe and the Middle East. The combination of the two banks’ structured investor product capabilities and distribution platforms is anticipated to create a significantly stronger business with good prospects for growth in an expanding market.

      In North America, GBM has been implementing a strategy with the objective of becoming a top five corporate bank. We believe that the combination with ABN AMRO’s Global Wholesale Businesses will enable GBM to accelerate the implementation of this strategy. The combined product strengths, including the capital markets expertise of RBS Greenwich Capital, should enable the combined group to generate increased revenues from the existing GBM and ABN AMRO client bases. We believe the business will be positioned to build on the combined industry sector strengths of GBM and ABN AMRO in consumer products, retail, healthcare, industrials, energy and utilities, and intend to leverage their complementary strengths in real estate financing to create a leading business in this area. In addition to the significant opportunity to grow the large corporate and institutional franchise in the United States, the combined business is expected to be able to deliver a full range of financial and risk management solutions to mid-corporate customers.

      In Asia, we believe that the combined GBM and ABN AMRO wholesale businesses will have the capacity to build a significant regional corporate bank. As in the United States and Europe, the combined business will seek to increase the depth of ABN AMRO’s current customer franchise by applying GBM’s business model. ABN AMRO’s existing local presence and infrastructure in key markets with strong growth will enable GBM to accelerate significantly its plans for developing business with customers in India, South Korea and Taiwan. In addition, there is a significant growth opportunity to develop ABN AMRO’s emerging markets and equity derivatives products for GBM’s customers globally.

      In Latin America, ABN AMRO has established a presence and customer relationships. We expect the combined business to deepen these relationships, in particular by leveraging GBM’s strengths in natural resources and project finance. GBM has had significant success in developing customer relationships in Iberia, and believes that a presence and capabilities in Latin America will enable it to support these customers’ activities in the region.

      We estimate that the combined business will be the third largest corporate and institutional banking and markets business globally by fixed income revenues (revenues from all areas except M&A advisory, cash equity and asset management businesses). Based on 2006 data, GBM will rank first in the United Kingdom and Continental Europe, fifth in the United States and fifth in Asia-Pacific (excluding Japan) by client relationships.

      The management team of GBM has developed a clear and detailed roadmap for the integration of ABN AMRO’s Global Wholesale Businesses. GBM will follow the Group’s established integration principles: minimizing disruption to customers and customer-facing activities, retaining the best talent from each organization through a fair appointment process based on merit and competencies, creating single global platforms and creating the capability for future growth while maintaining leading efficiency ratios.

      The integration of GBM and ABN AMRO’s Global Wholesale Businesses will be led by a management team including many who were actively involved in the integration of National Westminster Bank Plc.

      During the first 45 days after completion of the Offer, GBM will work with the management of ABN AMRO to verify and expand the information received and assumptions made on the basis of the limited due diligence access granted before completion of the Offer. By day 45, we intend to have validated a baseline plan for the achievement of synergies. This plan will form the basis for consultation with employee bodies and regulators.

      GBM will review ABN AMRO’s activities in markets where it does not currently operate and intends to continue ABN AMRO’s progress in aligning the cash equities business to support its enlarged and growing activities in equity derivatives.

      GBM believes that it will be able to generate significantly higher revenues from ABN AMRO’s customer franchise by leveraging the combined businesses’ enhanced product strengths and by applying our proven management capabilities. We believe that it will also be able to achieve substantial cost savings through de-duplication of infrastructure and support activities. GBM believes that it will be able to reduce the cost to income ratio of ABN AMRO’s Global Wholesale Businesses from 89% in 2006 to under 65% in the third year after completion of the Offer.

      GBM expects to deliver transaction benefits which will increase GBM’s profit before tax by €1,718 million in the third year after completion of the Offer. Of this total, GBM estimates that cost savings will amount to €1,237 million and that net revenue benefits (after associated costs and impairment losses, and allowing for attrition) will increase profit before tax by €481 million.

      GBM will focus on deepening customer relationships and increasing revenues per customer and per employee across ABN AMRO’s large and mid-corporate customer base. To achieve this, GBM will apply its relationship-driven model and the techniques which have enabled it to deliver strong revenue per customer and revenue per employee metrics and a cost to income ratio of 40% in 2006. At the same time, we anticipate having stronger capabilities in international cash management and trade finance, equity derivatives and emerging markets to offer to our customers.

      There is some overlap between our customer franchises and those of ABN AMRO, particularly in the United Kingdom. However, due to the complementary product propositions of the two businesses, revenue losses are expected to be limited, but conservative allowances for these potential revenue losses have been made.

      As set forth in the table below, the expected net revenue benefits of €481 million in the third year after completion of the Offer represent 8% of ABN AMRO’s relevant 2006 revenues.

      The combination of GBM and ABN AMRO’s Global Wholesale Businesses is expected to enable substantial cost savings to be achieved, as we implement a single business architecture. Cost savings will be achieved by de-duplication of information technology platforms and supporting infrastructure. Our existing information technology platform will be used for the majority of products and functions, but it is expected that the information technology platform supporting ABN AMRO’s cash management and trade finance business, as a core strength of that global business, will be retained.

      Further cost savings are expected to be achieved by streamlining combined functions across operations, finance, risk, human resources and other support areas, and through procurement and property efficiencies. We also expect that cost savings will be achieved by bringing in-house certain operations which ABN AMRO has outsourced to external providers.

      Additional cost savings are expected to be achieved by the elimination of overlaps in front office trading and support functions, as trading activities are consolidated into regional centers, while minimizing disruption to customer-facing activities.

      The expected cost savings resulting from these initiatives amount to €1,237 million in the third year after completion of the Offer, representing 24% of ABN AMRO’s relevant 2006 expenses. The four principal areas of rationalization and efficiency savings are set out below:

      After allocating the support cost savings to the main business groupings, approximately €887 million of savings arise from global corporate and institutional businesses and €350 million from mid-corporate and commercial businesses and transaction banking services.

      ABN AMRO has an extensive network of branches in Asia and the Middle East, principally to support its international cash management, payments and trade finance businesses for commercial customers. Many of these branches are also active in retail banking, although generally only on a limited scale.

      ABN AMRO has retail activities in nine markets in Asia and the Middle East(1):

      The most significant presence is in India, where ABN AMRO has 27 branches, and United Arab Emirates, with 17 locations. The branches in India are in major conurbations across the country and include six branches in New Delhi and three in Mumbai. In United Arab Emirates the network is focused on key locations in Abu Dhabi and Dubai.

      ABN AMRO also has a presence in Mainland China, with 11 branches, and Taiwan, with five branches. In Pakistan, ABN AMRO has 12 branches (excluding Prime Bank, which will be included in the Shared Assets). ABN AMRO also has retail businesses in Spain, Romania and Kazakhstan and stockbroking businesses in India, Australia and New Zealand.

      The principal product lines currently offered by ABN AMRO in Asia and the Middle East are mass market retail banking, affluent banking, under the Van Gogh brand, and credit cards. ABN AMRO has about 3.5 million retail customers in the region, including about 100,000 Van Gogh customers and approximately 3 million credit cards, which are mainly in Taiwan and India, with smaller portfolios in Singapore, Indonesia, Hong Kong and United Arab Emirates.

      We believe that there are attractive opportunities for growth, building on ABN AMRO’s established infrastructure to support retail activities in countries with large populations and high growth rates. However, we note that the retail businesses in Asia, the Middle East and Europe are thinly spread across many countries. We estimate that ABN AMRO’s retail businesses in Asia, the Middle East and Europe together generated income of €607 million and profit before tax of €88 million in 2006, on an IFRS basis. Because of limited scale, some of these retail businesses may have relatively high operating costs and customer acquisition costs, and so lack competitive advantage.

      After completion of the Offer, we will analyze the retail activities country by country. We expect to focus on growing significant retail businesses in selected ABN AMRO countries. Factors affecting the selection of countries will include competitive advantage and scalability of the existing operations, economic growth rates and the competitive and regulatory environment for financial services. We also expect to focus on affluent banking and credit cards, products where we are strong in the United Kingdom and have significant activities outside the United Kingdom, and products likely to appeal to growing numbers of affluent customers in these high growth economies. The existing infrastructure supporting current accounts provides the possibility of a broader product offering.

      We will seek to exit retail businesses not having critical mass or credible growth prospects. We have not at this stage included any specific initiatives and transaction benefits in its overall estimates of revenue benefits and cost savings.

Unaudited Pro Forma Condensed Combined Financial Information

      The proposed acquisition of ABN AMRO is to be made by RFS Holdings, a company owned jointly by RBSG, Fortis and Santander. RFS Holdings will be owned 38.3% by RBSG, 33.8% by Fortis and 27.9% by Santander. RFS Holdings will be accounted for as a subsidiary of RBSG as, although it does not have a majority of the voting rights, it will control the Board of Directors.

      The unaudited pro forma condensed combined financial information (the “pro forma financial information”) comprising a balance sheet as at June 30, 2007 (the “pro forma balance sheet”) and income statements for the six months ended June 30, 2007 and the year ended December 31, 2006 (the “pro forma income statements”) and the related notes is based on the published audited and unaudited financial statements of RBSG and ABN AMRO, prepared in accordance with IFRS, after giving effect to the proposed sale of LaSalle by ABN AMRO to Bank of America Corporation as announced by ABN AMRO on April 23, 2007.

      Given that ABN AMRO has provided the Consortium Banks with only limited access to ABN AMRO’s accounting records, we did not have the information necessary to verify independently certain adjustments and assumptions, and therefore did not verify such adjustments and assumptions, with respect to ABN AMRO’s financial information in preparing the pro forma financial information set out below. See “Risk Factors — We have not verified the reliability of the ABN AMRO information included in this prospectus supplement or otherwise publicly available and, as a result, our estimates of the impact of the Transaction on the pro forma financial information included elsewhere in this prospectus supplement may be incorrect.”

      The pro forma balance sheet has been prepared after giving effect to the proposed acquisition of ABN AMRO by RFS Holdings using the purchase method of accounting and applying the estimates, assumptions and adjustments described in the accompanying notes. The pro forma income statements have been prepared after giving effect to the proposed acquisition of ABN AMRO by RFS Holdings and the reorganization of businesses that will be carried out subsequent to the acquisition (the “Reorganization”). The Reorganization will comprise the agreed sale of certain businesses to Fortis and Santander and also the probable sale of the non-strategic businesses to third parties.

      Due to the limited information publicly available regarding the allocation of assets and liabilities to each of ABN AMRO’s business segments that will be included in the reorganization, a pro forma balance sheet cannot be prepared on a basis consistent with the pro forma income statements.

      IFRS vary in certain significant respects from U.S. GAAP. Information relating to the nature and the effect of such differences for the six months ended June 30, 2007 and the year ended December 31, 2006 is presented in Note 5 to the pro forma financial information. As no information is publicly available regarding the allocation of the existing differences between IFRS and U.S. GAAP related to ABN AMRO to each of its business segments that will be included in the Reorganization, a pro forma reconciliation to U.S. GAAP cannot be prepared on a basis consistent with the pro forma income statements.

      The pro forma financial information has been prepared on the following basis:

        These estimates include:

      The pro forma financial information is presented for information purposes only and does not represent what the results of operations would actually have been, had the acquisition occurred on the dates indicated nor does it project the results of operations for any future period.

NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

1.     Description of proposed acquisition and estimated pro forma purchase price

      The pro forma financial information has been prepared on the basis of preliminary estimates and assumptions. The assumptions used to prepare the pro forma financial information (excluding those in relation to the sale of LaSalle which are disclosed in Note 2) are:

      For the purposes of this pro forma financial information, the proposed acquisition has been accounted for using the purchase method of accounting in accordance with IFRS and U.S. GAAP. ABN AMRO did not publish fair values for its financial assets and financial liabilities at June 30, 2007. Consequently, with

limited exceptions, this purchase price allocation is based on the historical carrying value of ABN AMRO assets and liabilities as at June 30, 2007.

      Based on initial estimates, and subject to changes upon completion of a final valuation, which may be material, the preliminary allocation of the estimated purchase price is:

      If the proposed acquisition occurs, RBSG will undertake, after the closing date, a comprehensive assessment of the fair value of assets and liabilities acquired in order to estimate the value of goodwill. Identified intangible assets, upon completion of the fair value assessment, will be amortized over their estimated useful lives.

2.     Disposal of LaSalle

      The proposed acquisition is subject to an offer condition that prior to completion of the proposed acquisition, the agreement for the sale of LaSalle to Bank of America Corporation has been completed in accordance with its terms. The estimated effects of the disposal of ABN AMRO North America Holding Company (“AANAH”) which principally consists of the retail and commercial banking activities of LaSalle were based solely on publicly available information published by ABN AMRO within the ABN AMRO 2007 interim Form 6-K for the six months ended June 30, 2007 and the ABN AMRO Unaudited Pro Forma Condensed Financial Statements furnished to the SEC on a Form 6-K on April 25, 2007.

      ABN AMRO will receive cash consideration of U.S.$21,000 million (£10,469 million) from Bank of America Corporation as set out in the Purchase and Sale Agreement by and between ABN AMRO and Bank of America dated April 22, 2007 and filed with the SEC by ABN AMRO on a Current Report on Form 6-K on April 24, 2007. The cash consideration will be adjusted in accordance with the terms of the Bank of America Agreement if the actual net income of LaSalle for the three months ended March 31, 2007 and the net income of LaSalle, with certain limited adjustments, for the period commencing on April 1, 2007 and concluding on the earlier of the date of the closing of the sale of LaSalle and

December 31, 2007 is less than a pre-defined income threshold. No adjustment has been made to the LaSalle purchase price as no information on the performance of LaSalle is available.

      The estimated effects of the disposal of LaSalle on the pro forma balance sheet consisted of the following:

      The Bank of America Agreement also anticipates the conversion to equity by ABN AMRO, prior to completion, of U.S.$6,148 million (£3,065 million) of loans which it currently extends to AANAH. The impact of the conversion of these loans into equity is not included in the pro forma balance sheet or income statement as there is insufficient publicly available information to conclude whether these loans were included in the LaSalle assets and liabilities published in ABN AMRO’s 2007 interim Form 6-K referred to above.

      The LaSalle results for the six months ended June 30, 2007 were presented as discontinued operations by ABN AMRO in its 2007 interim Form 6-K filed on July 30, 2007 and therefore no adjustment is required to the results from continuing operations in the pro forma condensed combined income statement for the six months ended June 30, 2007. The estimated effects of the disposal of LaSalle on the pro forma condensed combined income statement for the year ended December 31, 2006 consist of the elimination of the historical revenues and expenses presented in the unaudited condensed consolidated IFRS income statement for the year ended December 31, 2006 of AANAH disclosed in the ABN AMRO Unaudited Pro Forma Condensed Financial Statements referred to above.

      No provision for taxation that may become payable on the sale of LaSalle to Bank of America Corporation has been included as there is insufficient publicly available information to assess any potential liability that may arise.

      The impact of the disposal of LaSalle as disclosed above and included in the pro forma financial information is estimated based on publicly available information in the referred to documents and therefore is subject to change once the transaction is completed. The results related to the disposal of LaSalle should be read in conjunction with ABN AMRO’s 2007 interim Form 6-K furnished on July 30, 2007 and its Form 6-K furnished on April 25, 2007.

3.     Acquisition adjustments

      The acquisition adjustments included in the pro forma financial information have been prepared as if the proposed acquisition was completed on June 30, 2007 for the balance sheet and on January 1, 2006 for the income statements.

      ABN AMRO published fair values of financial assets and liabilities at December 31, 2006 in its 2006 Annual Report on Form 20-F but not as at June 30, 2007 in its 2007 interim Form 6-K. Consequently, it is not possible to reflect acquisition adjustments in respect of the fair value of financial assets and liabilities in the pro forma combined balance sheet or in the pro forma combined income statements.

      No balance sheet adjustments have been made to reflect the businesses to be transferred to Fortis or Santander or the disposal of non-strategic businesses as ABN AMRO does not publish sufficiently detailed segmental balance sheet data in its 2007 interim Form 6-K to enable information related to these businesses to be identified.

      Earnings used for the basic pro forma combined earnings per share calculations are the pro forma profit attributable to ordinary shareholders of RBSG for the six months ended June 30, 2007 and the year ended December 31, 2006 respectively.

      The weighted average number of shares outstanding during the six months ended June 30, 2007 and the year ended December 31, 2006 for the unaudited pro forma condensed combined income statements are based on the estimated equivalent weighted average number of ordinary shares for RBSG following the proposed acquisition. The weighted average number of RBSG shares in issue during the year ended December 31, 2006 has been adjusted for the two-for-one bonus issue of ordinary shares effected on May 8, 2007.

      For illustrative purposes, earnings per share are calculated as if the ordinary shares issued by RBSG as part of the consideration for the proposed acquisition of ABN AMRO had occurred on January 1, 2006. Under the terms of the proposed acquisition, RBSG will issue 0.296 RBSG ordinary shares for each ABN AMRO share, increasing the weighted average number of shares in issue during 2006 and the first half of 2007 by 554 million shares.