As the traditional heavy industries of Scotland entered their final death throes in the nineteen fifties and sixties the service industries, and financial services in particular, started to emerge “The accelerating increase in the share of the service sector – from 24 per cent in 1951, to 26 percent in 1961, to 33 per cent in 1971, and finally to 43% in 1981 – is undoubtedly the single shift in sectorial employment which Scotland has ever experienced in modern times”, (McCrone, 1992). The growth in financial services continued throughout the nineteen nineties and into the beginning of this century. “Financial services must now be almost the single sector of the Scottish economy in terms of GDP and one of the biggest in terms of employment. It certainly has the track record on growth and as strong a potential for growth as any Scottish sector of substance”, (Peat, 2002). This growth of financial services in Scotland resulted in some remarkable statistics on the success that was being achieved. “Ten of the top 20 companies located in Scotland were in the financial services sector. In terms of fund management centres, Edinburgh/Glasgow ranked sixth in Europe by international equity holdings, while in banking, Scotland again ranked sixth in Europe by market capitalisation when the nationality of the top 30 banks is considered”, (Ashcroft, 2002). By this time the financial services industry in Scotland had gained such importance that the Scottish economy in general had become very dependent upon it. “The contribution of the Scottish banking sector will be critical to economic development in Scotland” (Peat, 2002). This was still the situation five years later when it was being claimed “it is mainly the financial sector that is saving Scotland from growing at a much slower rate than the UK as a whole”, (McLaren and Harris, 2007). This view was reinforced by further statistics that highlighted the success and importance of financial services to Scotland. As Baird et al (2007) observed, “The growth in finance, principally banking, insurance and investment services, has been disproportionate. It now contributes 7 per cent to Scotland’s GDP and makes Scotland the sixth biggest regional centre for fund management in Europe”.

Financial services are Scotland’s success story from the end of the twentieth century; it is the story of how Scotland has yet again reinvented itself. It is the industry that carries the hopes and aspirations of many Scots; it is the industry that has the potential to drive Scotland up the league table of prosperity. However, as we all know, the financial meltdown in 2008 dealt the financial services industry in Scotland a severe blow; the Banking sub-sector was devastated. The collapse of Royal Bank of Scotland (RBS) and HBOS not only damaged financial services, it damaged the Scottish economy as a whole, “The failure of Scotland’s two largest companies seriously weakened the Scottish business sector”, (Kay, 2011). The effect on the financial services sector generally has also been significant as Skeoch (2011) has identified, “Provisional data for 2010 suggest that the [Scottish] financial services sector was 20% below its peak level of output in 2007. This is a much sharper decline than experienced by financial services in the rest of the UK or indeed London”.