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FSA takes no enforcement action against RBS

The Financial Services Authority has taken no enforcement action against the Royal Bank of Scotland Group after launching a supervisory investigation into the bank.

The FSA launched an investigation into Royal Bank of Scotland Group in May 2009 because it was one of the UK banks that required partial taxpayer bailout support.

This work considered if regulatory rules had been broken and what, if any, action was appropriate. The review was necessarily extensive and looked specifically at the conduct of senior individuals at the bank, the acquisition of ABN AMRO in 2007 and the 2008 capital raisings. The FSA conducted the review with assistance from PWC.

The FSA has now completed this supervisory investigation.

It says the review confirmed that RBS made a series of bad decisions in the years immediately before the financial crisis, most significantly the acquisition of ABN AMRO and the decision to aggressively expand its investment banking business.

However, the review concluded that these bad decisions were not the result of a lack of integrity by any individual and we did not identify any instances of fraud or dishonest activity by RBS senior individuals or a failure of governance on the part of the Board.

The issues we investigated do not warrant us taking any enforcement action, either against the firm or against individuals. However, the competence of RBS individuals can, and will, be taken into account in any future applications made by them to work at FSA regulated firms.

The FSA’s supervisory investigations into other banks that ‘failed’ during the crisis are ongoing. If they lead to enforcement action being taken then it would be usual for the FSA to make these outcomes public if such actions against individuals or institutions are successful.

The FSA cannot publish the content of the RBS review as information gathered from the bank during the course of the review remains confidential under the Financial Services and Markets Act 2000.

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  • Chris Hulme - Chairman UKSA NRSAG 2nd December 2010 at 1:29 pm

    And what about the FSA’s investigation into their OWN regulatory failure that lead to banks such as RBS, B&B and Northern Rock requiring SLS and LoLR support.
    As Chairman of the Northern Rock Shareholders Action Group, I find this a vindication of the banks own actions AND an admission that the faults lie elsewhere – will we ever find out where those faults were – I suspect not!!

  • Anonymous 2nd December 2010 at 1:20 pm

    Yawn.

    Bored of comments such as the above. Everybody had a part to play. The country is on its knees along with the rest of the Western World.

    It’s one thing to make a poor decision to sell a product and line the pockets, a different thing to have an aquisition fail.

    Since when were RBS responsible for making the world go round anyway? They have paid for mistakes through downsizing, corporate humiliation and share price.

    Can we move on?

  • Dazed & Confused 2nd December 2010 at 1:07 pm

    “The FSA cannot publish the content of the RBS review as information gathered from the bank during the course of the review remains confidential under the Financial Services and Markets Act 2000.”

    Hmmmmmmm…odd how some names and events can be published, yet other names and events cannot. Does make one wonder if it is just the old boys network at it again!

  • Rob Govier 2nd December 2010 at 1:07 pm

    Couldn´t agree more with earlier comment.

    Shows how weak the FSA are when dealing with corporate body that has played a large part in causing the UK to go into meltdown, but can bully the poor Independent broker

  • Rob Govier 2nd December 2010 at 1:06 pm

    Couldn´t agree more with earlier comment.

    Shows how weak the FSA are when dealing with corporate body that has played a large part in causing the UK to go into meltdown, but can bully the poor Independent broker

  • anon 2nd December 2010 at 11:44 am

    Broker get banned for life and fined £200,000 when they do wrong.

    National Bank nearly brings country to its knees and nearly bankrupts the whole system and gets a little slap on the wrist.

    Double standards I think.