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| ## Comptroller of the Currency                                        |
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| > Administrator of National Banks                                     |
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Western District Office

1225 17^th^ Street, Suite 300

Denver, Colorado 80202

720-475-7650; Fax: 720-475-7691

**Conditional Approval #650**

**October 2004**

September 15, 2004

Dennis Jones, Chief Executive Officer

RBS National Bank

1000 Lafayette Boulevard

Bridgeport, Connecticut 06604-4725

Re: Bank Charter, Citizenship and Residency Waivers: RBS National Bank

OCC Control No\'s: 2004-WE-01-0009, 2004-WE-12-0191, 2004-WE-12-0192

Dear Mr. Jones:

The Office of the Comptroller of the Currency (OCC) has reviewed your
application to establish a new national limited purpose credit card bank
with the title of RBS National Bank (Bank). On September 15, 2004, the
OCC granted preliminary conditional approval of your charter application
after a determination that your proposal met certain regulatory and
policy requirements.

This preliminary conditional approval is granted based on a thorough
evaluation of all information available to the OCC, including the
representations and commitments made in the application and by the
Bank's representatives. We also made our decision to grant preliminary
conditional approval with the understanding that the proposed Bank will
apply for Federal Reserve membership and will obtain deposit insurance
from the Federal Deposit Insurance Corporation (FDIC).

The OCC has granted preliminary conditional approval only. Final
approval and authorization for the Bank to open will not be granted
until all preopening requirements are met. Until final approval is
granted, the OCC has the right to alter, suspend, or revoke this
preliminary conditional approval should the OCC deem any interim
development to warrant such action.

1.  This preliminary conditional approval is subject to the following
    condition: The Bank: (i) shall give James W. McPherson, Deputy
    Comptroller, 250 E Street SW, Mail Stop 6-1, Washington, DC
    20219-0001 with a copy to Examiner-in-Charge Carolyn G. DuChene, c/o
    Legal Department, Mail Code SU530, 1215 Superior Avenue, Cleveland,
    Ohio 44114 at least sixty (60) days prior written notice of the
    Bank's intent to significantly deviate or change from its business
    plan or operations and (ii) shall obtain the OCC's written
    determination of no objection before the Bank engages in any
    significant deviation or change from its business plan or
    operations. The OCC may impose additional conditions it deems
    appropriate in a written determination of no objection to a bank's
    notice. For the first three years of operation, the Bank also must
    provide a copy of such written notice to the FDIC's New York
    Regional Office, 20 Exchange Place, New York, NY 10005.

2.  RBS National Bank shall commence operations with sufficient capital
    and surplus as defined in 12 C.F.R. 3.100, to be a well capitalized
    bank as defined in 12 C.F.R. 6.4 and continue as such for as long as
    it shall remain a national bank. In addition to the foregoing RBS
    National bank shall maintain at least \$20 million of additional
    capital over and above that which is necessary to remain well
    capitalized.

These conditions of approval are conditions "imposed in writing by the
agency in connection with the granting of any application or other
request" within the meaning of 12 USC 1818. As such, the conditions are
enforceable under 12 USC 1818.

The OCC poses no objection to the following persons serving as executive
officers, directors, and/or organizers as proposed in the application:

[Name]{.underline} [Title]{.underline}

Dennis Jones Chief Executive Officer, Director and Organizer

Iain Clink Director and Organizer

James Fitzgerald Director and Organizer

Mark Formica Director and Organizer

James Powers Director and Organizer

Christopher Sullivan Director

Richard Daingerfield Director

Deborah Asetta Chief Financial Officer

Robert Mihalcik Chief Operations Officer

Tina Gabriel Chief Risk Officer

Prior to the Bank's opening, the Bank must obtain the OCC's prior
written determination of no objection for any additional organizers or
executive officers, or directors appointed or elected before the person
assumes the position. For a two-year period after the Bank commences
business, the Bank must file an Interagency Biographical and Financial
Report with the OCC and receive a letter of no objection from the OCC
prior to any new executive officer or director assuming such position.

The OCC also grants your request to waive the residency requirements of
12 USC 72 for Dennis Jones, Iain Clink, Christopher Sullivan, Richard
Daingerfield, James Fitzgerald, Mark Formica, and James Powers to serve
as a member of the board of directors of the Bank. This waiver is
granted based upon a review of all available information, including the
filing and any subsequent correspondence and telephone conversations,
and the Bank's representation that this waiver will not affect the
board's responsibility to direct the Bank's operations in a safe, sound,
and legal manner. The OCC reserves the right to withdraw or modify this
waiver and, at its discretion, to request additional information at any
time in the future.

The OCC also grants your request to waive the citizenship requirements
of 12 USC 72 for Dennis Jones, Iain Clink, and Christopher Sullivan to
serve as a member of the board of directors of the Bank. This waiver is
based upon a review of all available information, including the filing,
subsequent correspondence and telephone conversations, and the Bank's
representation that this waiver will not affect the board's
responsibility to direct the Bank's operations in a safe and sound
manner. The OCC reserves the right to withdraw or modify this waiver
and, at its discretion, to request additional information at any time in
the future.

On September 15, 2004, the OCC approved your request for the Bank's
designation as a limited purpose institution for purposes of the
Community Reinvestment Act (CRA). The limited purpose designation is
effective the date the bank opens for business. A separate letter
confirming your request is enclosed confirming this approval. You should
submit a CRA plan to James W. McPherson, Deputy Comptroller, 250 E
Street SW, Mail Stop 6-1, Washington, DC 20219-0001 with a copy to
Examiner-in-Charge Carolyn G. DuChene, c/o Legal Department, Mail Code
SU530, 1215 Superior Avenue, Cleveland, Ohio 44114 for review.

The "Charters" booklet in the *Comptroller's Licensing Manual* provides
guidance for organizing your bank. The booklet is located at the OCC\'s
web site:
<http://www.occ.treas.gov/corpbook/group4/public/pdf/charters.pdf>. The
booklet contains all of the steps you must take to receive your charter.

As detailed in the booklet, you may establish the corporate existence
and begin organizing the Bank as soon as you adopt and forward Articles
of Association and the Organization Certificate to Senior Licensing
Analyst Geryl N. Race in this office for our review and acceptance. As a
"body corporate" or legal entity, you may begin taking those steps
necessary for obtaining final approval. The Bank may not begin the
business of banking until it fulfills all requirements for a bank in
organization and the OCC grants final approval.

Enclosed are standard requirements and minimum policies and procedures
for new national banks. The Bank must meet the standard requirements
before it is allowed to commence business and the Board of Directors
must ensure that the applicable policies and procedures are established
and adopted before the Bank begins operation.

1.  The Bank must submit to James W. McPherson, Deputy Comptroller, 250
    E Street SW, Mail Stop 6-1, Washington, DC 20219-0001 with a copy to
    Examiner-in-Charge Carolyn G. DuChene, c/o Legal Department, Mail
    Code SU530, 1215 Superior Avenue, Cleveland, Ohio 44114 for review,
    and prior written determination of no supervisory objection, a
    complete description of the Bank's final information systems and
    operations architecture as well as the information systems risk
    assessment and management plan. This should include a schematic
    drawing and discussion of the following items:

> Vendor due diligence and contracts; electronic banking security
> mechanisms and policies; information systems personnel; internal
> controls; audit plans; and operating policies and procedures,
> including, but not limited to, vendor management, weblinking, customer
> authentication and verification, and business resumption contingency
> plans.

2.  The Bank must have performed an independent security review and test
    of its electronic banking platform. The Bank must have this review
    performed regardless of whether the platform is operated in-house or
    by one or more third-party service providers. If the Bank outsources
    the technology platform, it can rely on testing performed for the
    service provider to the extent that it satisfies the scope and
    requirements listed herein. The review must be conducted by an
    objective, qualified independent source (Reviewer). The scope should
    cover:

-   All access points, including the Internet, Intranet, or remote
    access.

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-   The adequacy of physical and logical protection against unauthorized
    access including individual penetration attempts, computer viruses,
    denial of service, and other forms of electronic access.

> By written report, the Reviewer must confirm that the security
> measures, including the firewall, have been satisfactorily implemented
> and tested. For additional guidance, refer to \"The Internet and the
> National Bank Charter\" booklet of the *Comptroller\'s Licensing
> Manual*, pages 37-38, Information System Security. The booklet is
> located at the Electronic Banking section of the OCC\'s Web site:
> <http://www.occ.treas.gov/corpbook/group4/public/pdf/internetnbc.pdf>.

3.  The Bank must have a security program in place that complies with
    the "Interagency Guidelines Establishing Standards for Safeguarding
    Customer Information" specified at 12 CFR 30, Appendix B.

Under separate cover, the OCC will send to you an appropriate set of OCC
handbooks, manuals, issuances, and selected other publications. This
information does not include the Comptroller's Licensing Manual, which
is available only in electronic form at our web site:
<http://www.occ.treas.gov/corpapps/corpapplic.htm>.

This preliminary conditional approval and the activities and
communications by OCC employees in connection with the filing do not
constitute a contract, express or implied, or any other obligation
binding upon the OCC, the United States (U.S.), any agency or entity of
the U.S., or any officer or employee of the U.S., and do not affect the
ability of the OCC to exercise its supervisory, regulatory and
examination authorities under applicable law and regulations. The
foregoing may not be waived or modified by any employee or agent of the
OCC or the U.S.

Direct any questions concerning this preliminary conditional approval to
Senior Licensing Analyst Geryl N. Race at (720) 475-7655 or
geryl.race@occ.treas.gov.

Sincerely,

/s/ Geryl N. Race

Geryl N. Race

Senior Licensing Analyst

Enclosures: Standard Requirements

Minimum Policies and Procedures

Limited Purpose Designation Letter