Tesco has announced plans to create 200 jobs in Edinburgh.

The expansion of the supermarket giant's UK banking operation will see the Scottish capital become the headquarters for the firm's finance arm.

Industry leaders have said the move showed the city remained a key financial centre despite the problems faced by Edinburgh-based banks Royal Bank of Scotland and Halifax Bank of Scotland.

Tesco Personal Finance chief executive Benny Higgins said the recruitment was an "important step" in its expansion.

"Edinburgh is the ideal place from which to move what is already a successful business into the next stage of its development," he said. "There is a real enthusiasm among our staff for being based in Edinburgh."

Tesco's finance arm has signed a 15-year lease on a new headquarters in the Haymarket area of Edinburgh.

Around 250 members of staff who currently work in the South Gyle, on the outskirts of the city, will move to the new offices before they will be joined by an extra 200 people recruited by Tesco in the next year.

Owen Kelly, chief executive of Scottish Financial Enterprise, welcomed the "exciting announcement" today as "a great reminder that Scotland remains an important global financial centre, with the people and skills to attract new business".