LONDON (Reuters) – Royal Bank of Scotland’s restructuring business didn’t flip across the “vast majority” of small companies it labored with, Chief Executive Ross McEwan mentioned on Tuesday in response to lawmakers’ questions.
McEwan and RBS Chairman Howard Davies had been being grilled by members of the Treasury Select Committee, which has challenged state-backed RBS on its treatment of troubled small companies throughout and after the monetary disaster.
RBS’s Global Restructuring Group (GRG) dealt with round 12,000 struggling companies between 2007 and 2012, a few of which accuse the financial institution of pushing them into chapter 11 to select up their property on a budget.
Nicky Morgan, who chairs the Treasury committee, requested McEwan a couple of assertion he made in 2014 after the publication of a report into GRG’s conduct by regulation agency Clifford Chance.
“I want to take you back Mr McEwan to a statement you made following the publication of the Clifford Chance report into GRG … In that statement you said, and I quote, that GRG ‘turns around the vast majority of businesses that it works with’. That isn’t true, that wasn’t true, was it?” Morgan mentioned.
“In 2014, absolutely, when you look at the stats that have come through … it is not true,” McEwan mentioned in response.
He was referring to figures from a subsequent report into GRG carried out by consultants Promontory, which was commissioned by the Britain’s monetary regulator the Financial Conduct Authority.
To date, the FCA has refused to publish the Promontory report in full. Instead it has printed a abstract, which a committee-appointed barrister mentioned was an correct reflection of the report’s full contents.
Morgan mentioned the abstract of the report represented a “litany of poor conduct”, however whereas it recognised quite a few failings it didn’t uphold essentially the most severe accusations in opposition to the financial institution.
McEwan, who took up his job at RBS in 2013, informed the committee he would inform Andrew Bailey, chief govt of the FCA, that if the regulator wished to publish the total report RBS wouldn’t object.
The FCA mentioned after the listening to it might publish the Promontory report in full as soon as it has obtained the consent of these who supplied data and any people who are recognized.
The watchdog is already utilizing data from the report to see if it ought to take additional motion.
“We will approach these individuals, once the work on the focused investigation is completed, to ask for their consent to publish,” the FCA mentioned in an announcement.
RBS has put aside 400 million kilos to cowl the invoice for complaints made by prospects over their treatment by GRG.
“[This] is not a cap, it’s an estimate of what we think this process will cost, and if it costs more it costs more,” Davies informed the committee.
The FCA in 2016 successfully cleared RBS of most of the allegations by prospects. RBS has admitted some wrongdoing over its dealing with of small companies, however stopped wanting saying they had been intentionally pushed into administration.
The scandal has hampered RBS’s efforts to reform its picture and transfer on from the monetary disaster. The British government is making ready to promote down its 70 p.c stake within the financial institution.
Additional reporting by Huw Jones, Editing by Jane Merriman