RBS ‘should have accepted’ findings of GRG report

● FCA boss tells MPS it is ‘unfortunate’ that bank has only partially agreed

The head of Britain’s financial watchdog yesterday branded it “unfortunate” that Royal Bank of Scotland (RBS) has disagreed with findings from its report over the bank’s treatment of small businesses that were shifted into its controversial Global Restructuring Group (GRG).

RBS chief executive Ross Mcewan has written to MPS outlining a number of “concerns” over the methodology and approach of the so-called skilled person’s report.

But Financial Conduct Authority (FCA) chief executive Andrew Bailey told MPS yesterday that the bank should have accepted its findings, and blamed those disputes for delaying the release date of the interim report.

“I think the report is strongly critical of RBS and I think it is, frankly, unfortunate that RBS have not in a sense accepted that, I think, more readily,” Bailey told the Treasury select committee.

“I think they should do, because a lot of ... time and a lot of effort and a lot of work has been done on this.”

Mcewan said in his letter that RBS does “clearly acknowledge” that the bank could have done better for business customers shifted into the now-disbanded GRG, and that some of those shortcomings “would have been widespread”.

Butheadded:“thebankdoes not agree that the evidence relied upon by the Skilled Person substantiates the key finding that the bank is guilty of ‘widespread inappropriate treatment of customers’”.

The RBS chief added that there was no distinction drawn between process failings and conduct failings. “Taken together, these approaches result in misleading conclusions likely to be misunderstood as suggesting that the bank was guilty of serious conduct failings and that these led to poor outcomes for customers,” he said.

The bank also disputed the suggestion that GRG is likely to have caused material financial distress in up to 11 per cent of all cases. “We do not accept that there was any causal link between the actions by the bank and the insolvency of any of those businesses,” Mcewan said.

The FCA released its muchawaited interim report into GRG’S actions last week, which identified a number of failings at RBS, but said the bank had not engaged in the “systematic inappropriate treatment of customers”.

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

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

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,