HSBC and RBS amongst biggest R&D spenders

HSBC and RBS amongst biggest R&D spenders

HSBC and Royal Bank of Scotland (RBS) have emerged as the biggest investors in research and development (R&D) amongst UK financial services institutions.

The two high street banks appear in 11th and 13th position respectively in the UK Department of Trade and Industry's (DTI) annual R&D Scoreboard, next to oil giants Shell (10th) and BP (12th).

RBS spent £329 million on R&D in 2005-6, up nine per cent on last year, while HSBC shelled out £245m, up 34% compared to last year.

The banks' R&D spend represents in-house software development, with each investing more on R&D than any individual software company. In total, the five UK banks listed in the scoreboard forked out £705m on R&D in 2005-6, compared with the £932m bill rung up by 119 UK software companies.

The British Bankers' Association ascribes the high spending trend to competiton between banks for innovative products and smooth service delivery, and the streamlining of regulatory reporting and back office functions.

Other banks with R&D spending above $50m (£26m) last year include Barclays and Standard Chartered of the UK, Italy's Banca Intesa and Sanpaolo IMI, Rabobank of the Netherlands and Denmark's Danske Bank. Insurance companies Royal & Sun Alliance (£122m) and Old Mutual also appear on the list.

Financial institutions have appeared in the R&D Scoreboard for the first time this year due to the adoption in Europe of new International Financial Reporting Standards (IFRS) which require more disclosure of research and development activities in annual accounts.

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