FILE PHOTO: A woman shelters under an umbrella as she walks past a branch of the Royal Bank of Scotland in the City of London, Britain, September 17, 2013. REUTERS/Stefan Wermuth/File Photo
October 31, 2017
LONDON (Reuters) – The head of Britain’s financial watchdog said it was unfortunate that the Royal Bank of Scotland <RBS.L> did not more readily accept strong criticisms made in a report on its treatment of struggling businesses during and after the financial crisis.
RBS’s Global Restructuring Group (GRG) has been accused by customers of driving them to bankruptcy in order to pick up their assets on the cheap.
Andrew Bailey, chief executive of the Financial Conduct Authority (FCA), said on Tuesday he believes RBS should have reacted differently to the conclusions of the report.
“The report is strongly critical of RBS, and I think it is frankly unfortunate that RBS has not in a sense accepted that more readily,” he told parliament’s Treasury Select Committee .
The FCA published a detailed summary of consultant Promontory’s report into GRG last week, but it has refused to publish the report in full.
The summary outlined numerous failings, and RBS said last week the most serious allegations against it had not be upheld.
Bailey was repeatedly asked by the committee’s chair Nicky Morgan about why the watchdog has taken so long to report back on GRG.
Bailey said this was partly due to there being “no meeting of minds” between RBS and Promontory, the external consultant hired by the watchdog to write the report. This meant that the FCA had to spend time checking the report, Bailey said.
A redress scheme has been set up to compensate customers of GRG and Bailey said he has asked RBS CEO Ross McEwan “to get his act together” regarding claims.
“I do believe we are now in the process of getting money back to the victims,” FCA Chairman John Griffith-Jones told the lawmakers.
The FCA’s investigation into GRG and its staff was continuing, Bailey said, without elaborating on when it would be concluded.
“It depends where it leads to, frankly. It could lead to enforcement action.”
(Reporting by Emma Rumney and Huw Jones; editing by Jason Neely and Keith Weir)
