Monday 23 April 2018

RBS still under FCA spotlight following publication of report

RBS said it was pleased that the “most serious allegations made against the bank have not been upheld”.

RBS report
RBS report

By By Ben Woods, Press Association Chief City Correspondent

Britain’s financial watchdog has published its interim report into the treatment of small businesses shifted into Royal Bank of Scotland’s (RBS) Global Restructuring Group (GRG), and said that it is still investigating the lender.

The Financial Conduct Authority (FCA) identified a number of failings at RBS, but said the bank had not engaged in the “systematic inappropriate treatment of customers”.

But in a statement, FCA chief executive Andrew Bailey said: “As we reported in November 2016, while the most serious allegations were not upheld by the Skilled Person, the report did identify other concerns about the treatment of SME customers.

“We are investigating the matters arising from the Skilled Person’s Report and are focusing on whether there is any basis for further action within our powers. We cannot comment any further on this.”

RBS said it was pleased that the “most serious allegations made against the bank have not been upheld”.

The state backed lender has been dogged by allegations that it intentionally pushed businesses towards failure in hopes of picking up their assets on the cheap.

The FCA’s report comes after Nicky Morgan, chair of the Treasury Select Committee, ramped up pressure on the financial watchdog to publish details of misconduct by RBS and threatened to use “formal powers” to demand publication of the full leaked report into the lender.

The FCA has so far refused to publish the report in full, claiming that it would reveal confidential information about individuals, instead offering a detailed summary.

Mr Bailey added: “RBS has accepted that it did not meet the standards it set for itself which impacted on how it treated some of its SME customers. RBS has since taken voluntary steps, such as its proactive review of complex fees, and setting up a complaints scheme for eligible SME customers, overseen by an independent monitor, Sir William Blackburne.”

Last November, RBS said it would put aside £400 million as part of a plan to refund small and medium-sized businesses following allegations that they were mistreated by GRG.

The lender said the funds will go towards both an “automatic refund of complex fees” paid by such firms between 2008 and 2013, as well as the operational costs of a new complaints process.

The FCA, which helped develop plans for the compensation and new complaints process, said at the time these were the “appropriate steps for RBS to take”.

Ross McEwan, chief executive of RBS, said: “I am pleased that the regulator has confirmed the findings from last November and that the most serious allegations made against the bank have not been upheld.

“We have acknowledged for some time that mistakes were made and have apologised that we did not always provide the level of service and understanding we should have done for these customers in the aftermath of the financial crisis.

“The regulator has again confirmed that the remediation steps we announced in November to address concerns for customers are appropriate.

“Any customer who feels they were treated inappropriately whilst in GRG should make use of the complaints process.”

Press Association

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