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Royal Bank of Scotland Group PLC - Issue of Non-Cumulative Preference Shares

Released 09:09 27-Oct-05

THE ROYAL BANK OF SCOTLAND GROUP AGREES PRICE FOR US$ 550 MILLION PREFERENCE SHARE ISSUE

27th October 2005

The Royal Bank of Scotland Group plc ("the Group") is pleased to announce the pricing of 22,000,000 Category II Non-cumulative Dollar Preference Shares to be designated Series P ("the Series P Dollar Preference Shares"), which will be issued in the form of American Depositary Receipts ("the Series P ADRs") in the United States, at a subscription price of US$25.00 per share, with a coupon of 6.25% per annum.

Non-cumulative preferential dividends on the Series P Dollar Preference Shares will be payable in US dollars quarterly in arrears on 31 March, 30 June, 30 September and 31 December, at a rate of US$1.5625 annually per Series P Dollar Preference Share. The first coupon is payable 31 December 2005. The Series P Dollar Preference Shares can be redeemed in whole or in part at any time on or after 31 December 2010 at US$25.00 per share, plus accrued dividends for the then-current dividend period.

The Group is being advised in connection with the issue by Citigroup Global Markets Inc. and RBS Greenwich Capital, who are also acting with Merrill Lynch & Co, Morgan Stanley, UBS Securities LLC, and Wachovia Securities as managers.

This announcement shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Series P Dollar Preference Shares in any State of the US in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such State. Further, no Series P Dollar Preference Shares will be offered to the public in the UK.

For further information, please contact;

The Royal Bank of Scotland Group plc

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