Acquisition

Royal Bank of Scotland Group PLC
11 June 2003

RBS to acquire Churchill Insurance Group from Credit Suisse Group for £1.1 bn

The Royal Bank of Scotland Group plc (RBS) has reached agreement with Credit
Suisse Group (Credit Suisse) to purchase the entire issued share capital of
Churchill Insurance Group PLC (Churchill). The agreement is subject to
regulatory approvals.

RBS will pay a cash consideration of £1.1 billion, funded by RBS from internal
resources, and the transaction is expected to be accretive to earnings before
goodwill amortisation and integration costs in the first twelve months.

Commenting on the acquisition, Fred Goodwin, Group Chief Executive of RBS, said:
'Churchill is an excellent acquisition for us; it will fit well alongside Direct
Line, and will bring several advantages to the Group.

'In direct channels, Churchill's strength in home insurance will balance Direct
Line's strong position in motor insurance. Both Churchill and Direct Line have
expertise in the distribution of general insurance products through partners,
under their brands.

'Churchill also owns NIG, a highly regarded company. In addition to distributing
motor and home insurance through brokers, NIG has a strong presence in
commercial insurance products for SMEs, broadening the general insurance
offering of RBS.

'RBS will retain both brands, Direct Line and Churchill, will ensure minimal
disruption to customer-facing staff and hence to customers, and will deliver
transaction benefits by combining IT, claims and central functions.

'This acquisition will make RBS the third largest general insurer in the UK, and
an effective competitor, with a strong, efficient, scaleable platform for
growth.'

Oswald J Grubel, Co-Chief Executive Officer of Credit Suisse Group, said 'The
strength of The Royal Bank of Scotland's proposal together with the commercial
fit with its direct insurance operation were central factors behind our decision
to sell. The transaction provides Winterthur with more financial flexibility for
selective growth and strengthens the capital base of Winterthur Group.'

For the year ended 31 December 2002, Churchill reported premium income of £1.6
billion and profit before tax of £86 million. At 31 December 2002, Churchill had
consolidated net assets of £0.7 billion.



For Further Information Contact

Royal Bank of Scotland Group plc

Media

Howard Moody

Tel: + 44 207 672 1938 or + 44 7768 033562

Carolyn McAdam

Tel: [phone] (today only) or [phone] (mobile)

Investor Relations

Richard O'Connor
Tel: [phone]; or [phone],

Credit Suisse Group

Media Relations

Tel: + 41 52 261 333 8844,

Winterthur

Media Relations

Tel: + 41 52 261 7744

Background Notes

 1. The Royal Bank of Scotland Group

    The Royal Bank of Scotland Group is Europe's 2nd and the world's 5th largest
    banking Group. The Group's main areas of operation are the United Kingdom,
    Europe and the United States. It currently employs 111,800 staff world-wide.
    At 10 June 2003 the market capitalisation of The Group was £47.7 billion.

    The Group includes one of the strongest portfolios of brands in the
    financial services sector including The Royal Bank of Scotland, NatWest,
    Direct Line, Coutts, Tesco Personal Finance, Ulster Bank, Lombard, and in
    the US, Citizens.
 2. Churchill Insurance Group PLC

    Churchill is the second most widely recognised insurance brand in the UK
    insurance market. Churchill sells its products directly, as well as through
    a range of partners and a network of brokers. Churchill also owns NIG, a
    highly regarded company within the insurance broker market. Churchill has 7
    million policies in force.

    Churchill employs 8,500 people in a number of locations throughout the UK.

      Churchill's results for the year ended 31 December 2002 were as follows:

    £ millions                                                                    2002

    Earned Premiums (net of re-insurance)                                          1,639
    Other Income                                                                     151
    Total Income                                                                   1,790

    Commission and Related Expenses                                                (373)
    Administration and Other Expenses                                              (232)
    Total Expenses                                                                 (605)

    Claims (net of re-insurance)                                                 (1,099)
    Profit Before Tax                                                                 86

    Combined Ratio*                                                                93.9%

    *Prepared on a basis consistent with Direct Line
 3. Direct Line

Direct Line is the UK's most recognised insurance brand. The Direct Line Group
underwrites retail and wholesale insurance and sells it direct by telephone and
internet. It has a large number of partnerships and through its International
Division, Direct Line sells insurance in Germany and Italy and through joint
ventures in Spain and Japan. It has 13 million policies in force in the UK and
internationally.

For the year ended 31 December 2002, Direct Line reported premium income after
reinsurance of £1.9 billion and a contribution to RBS's Group operating profit
of £355 million.

Direct Line's results for the year ended 31 December 2002, were as follows:
£ millions                                                                     2002

Earned Premiums (net of re-insurance)                                          1,894
Other Income                                                                     245
Total Income                                                                   2,139
Expenses                                                                       (434)
Claims (net of re-insurance)                                                 (1,350)
Profit Before Tax                                                                355

Combined Ratio (UK only)                                                       89.4%

-Ends-




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