Royal Bank of Scotland's sale of its Chinese retail and commercial businesses could be jeopardised by the weighting of structured products in its client portfolios.
Talks to sell the firm's Chinese, Indian and Malaysian businesses to Standard Chartered have faltered over concerns that many of its Chinese clients were invested in structured products that would be hard to switch out of into new products, rather than more easily accessed deposits, according to the Financial Times.
"The mix is weighted more to structured products, which means any acquirer would have to wait longer to recycle those deposits," an insider told the paper.
RBS, which acquired a significant Chinese retail business when it bought part of ABN Amro in 2007, is hoping to sell some of those assets to Standard Chartered as it seeks to shore up its balance sheet following its rescue by the UK government, now its majority shareholder.
The likelihood of the deal going ahead has reportedly dropped to around 30%.
SRP lists 116 structured products issued by ABN Amro in China.