UK watchdog needs OK from RBS before publishing report
Published 14/12/2010 | 05:00
The UK's Financial Services Authority (FSA) wasn't able to publish its supervisory report on Royal Bank of Scotland Group without permission from the banks and individuals involved in the investigation.
The FSA is prohibited under UK and European Union law from publishing "information collected through a supervisory investigation" without permission, said Hector Sants, chief executive officer of the agency.
Lawmakers should review whether the Prudential Regulatory Authority, which will replace the FSA in 2012, should have more power to release data, he said.
The FSA cleared RBS and former executives including ex- CEO Fred Goodwin in the December 2 report, which faulted the bank for "a series of bad decisions" before the financial crisis.
Edinburgh-based RBS posted the biggest loss in corporate history in 2008 and required a bailout of £45.5bn (€54bn) following its acquisition of Dutch bank ABN Amro.
"I'm extremely sympathetic to those people who argued that the FSA should publish the report," Mr Sants said at a conference in London yesterday.
"There isn't actually a report we can put immediately" into the public domain, Mr Sants said. It would take the FSA "several months" to turn the investigation files into a readable report.
The FSA was probing the 2007 ABN Amro takeover, conduct by RBS executives and a 2008 rights offering. The regulator said in March 2009 it would examine senior managers of banks that collapsed or accepted government money.
RBS spokeswoman Linda Harper declined to comment.
Liberal Democrat Business Secretary, Vince Cable, in a letter to Adair Turner, chairman of the FSA, urged the FSA to publish any report into whether the lender's former executives broke regulatory rules in the run-up to the 2008 bailout. In the letter, Mr Cable said he was "disappointed" the findings weren't public.
Chancellor of the Exchequer George Osborne said in June he would abolish the Financial Services Authority and give most of its power to the Bank of England, undoing the regulatory system set up by Gordon Brown in 1997.
The watchdog will be wound down and replaced by at least two bodies. A Prudential Regulatory Authority will be created as a subsidiary of the central bank. Mr Osborne will also set up a Financial Policy Committee at the bank and establish a consumer protection and markets agency. (Bloomberg)