The Oxfordshire-based Williams Formula 1 team are to lose the backing of the Royal Bank of Scotland at the end of their current agreement as a result of the economic downturn.

Williams and RBS made the announcement on Wednesday night in a joint statement, which confirmed the bank would withdraw its sponsorship of the Grove-based team at the end of the 2010 season.

The bank's partnership with Williams began in 2005 – when it was believed to be worth £10m a year – and was renewed for a second three-year term in 2007.

RBS' extensive sports sponsorship portfolio has been the subject of intense scrutiny since the bank was bailed out by the UK government in October, with critics arguing the company could no longer support such ventures with taxpayers' money.

The move is part of the bank's plans to cut its sponsorship deals by 25 per cent in 2009 and by around 50 per cent by 2010, while contracts with individuals such as Andy Murray, Sir Jackie Stewart, Zara Phillips and Sachin Tendulkar are set to come under review.

Team owner Sir Frank Williams said: "RBS has been a great partner for this team and we are pleased to have made our contribution over the past four years to developing the RBS brand internationally.

"Thanks to the support of RBS and our many other loyal partners, we are in a strong position to ride out the inevitable challenges of the next two years."