The flotation of the Clydesdale Bank has begun after being postponed for 24 hours. The Initial Public Offering (IPO) was delayed following a "specific request" for information from an unnamed ratings agency. At noon, Clydesdale shares were trading at 188p in London - above their offer price of 180p. The Glasgow-based lender, which includes Yorkshire Bank, is being spun out of National Australia Bank (NAB). Most of the demerged bank will be owned by NAB shareholders, but 25% of the stock is being sold to institutional investors. Shares are being traded on the London Stock Exchange under the new name CYBG. Chief executive David Duffy told BBC Radio Scotland's Good Morning Scotland programme the £1.58bn flotation "values the bank fairly in terms of the market". He said: "What's more important for us is that it's not just the price, it's the fact that we have become independent for the first time in 100 years and everyone is terribly excited about that. "We set the price range taking into account the very volatile market that we see, and I think setting it at that range was sensible." Mr Duffy said the bank had "no specific plans at this point" for staff changes, including job cuts or branch closures. He said: "Our main ambition is to set up a strategy where our customers see us as amongst the best service providers in the banking sector in this country, and to be able to do so both on the ground and digitally. "People tend to equate digital with the elimination of branches - I don't see that. I think that branches play a fundamental role in the structure of our bank going forward. The advice that people can get locally is very important. "Trust is all you have as a bank and for myself, my senior team and all of our staff, our priority is to earn that trust. I don't think you can just tell people to trust you - you have to earn that trust by doing what the customer wants." Douglas Fraser, BBC Scotland business and economy editor It's been a rocky road towards the creation of the new, independent Clydesdale Bank, or CYBG as it is to be known to investors. And with markets very volatile, this was a risky time to float. A last-minute glitch doesn't help. A statement from National Australia Bank said there is healthy demand for shares at 180p - towards the lower end of the range previously announced. But some institutional investors cannot commit until they are confident about CYBG's credit ratings. The new standalone bank expects to have an overall rating at investment grade, which is important for its ability to raise funds on the money markets. But banks have different ratings on many of their financial instruments. And another CYBG rating - by an unnamed big agency, and reflecting the position of short and long deposits - is being delayed until more information is provided. Those financial instruments involve an eighth of the Clydesdale's funding. And there is a risk of a downgrade or a "negative watch", in which case investors may back off. Big funds are constrained by the extent of risk exposure they have promised their investors. And a downgraded rating on CYBG deposits could mean they have no choice but to avoid investing in its shares. A downgrade may not occur, points out NAB. And if it does, it may not have much impact on the bank overall. But it has to acknowledge that risk. Three-quarters of the shares are being distributed to NAB shareholders, and also traded on the main Australian stock market. The other quarter has been offered to institutional investors, and after a week of "conditional trading" between City of London investors, they will be fully tradable from 8 February. NAB has been trying to offload its only European subsidiary for several years, under pressure in Australia, where a British bank is seen as a burden. The parent company has been unable to find another bank to take on the Clydesdale as a subsidiary. It took heavy losses on poor property loans and mis-selling charges to prepare the British lender for flotation. Clydesdale Bank, with Yorkshire Bank - facts and figures Clydesdale Bank did not feature amid the near-collapse of other British banks in 2008. Its problems came to light later. Having been hit by poor quality lending, its managers have sought to simplify its activities into retail accounts and mortgages, and they are focusing also on small and medium-scale businesses. Approval for the de-merger came from NAB shareholders last week, and the Supreme Court of Victoria state on Monday morning. NAB chief executive, Andrew Thorburn, issued a statement welcoming the creation of two corporate entities: "The demerger allows each business to focus on improving performance in their home markets and on business priorities that will maximise value for their respective shareholders. "NAB is now in a position to focus all its resources, attention and leadership on the markets most important for us - Australia and New Zealand." Volatile stock markets around the world have made this a risky time to float shares. Last week, the Chancellor, George Osborne, postponed plans for sales of the government's stake in Lloyds Banking Group, until markets stabilise. Another bank that sees itself as a challenger to the big high street lenders, Metro Bank, launched in 2010, has announced plans to float in coming weeks.
National Australia Bank (NAB) shares fell 5.7% after the bank priced shares of its Clydesdale Bank at 180p, thereby valuing it at £1.58bn, which was at the low end of estimates. The bank is hoping now to make up to £396m in gross proceeds from the IPO of its Clydesdale and Yorkshire Bank businesses. Shares were down by more than 5% on Monday morning following a report that RBS had been considering selling off its stake in RBS, but they recovered slightly later in the day.