|Date: 2024-03-03 Page is: DBtxt001.php txt00016678
UK ... Banking and Finance Sector
Statement on the further investigative steps in relation to RBS GRG
Press Releases Published: 31/07/2018 Last updated: 31/07/2018
The Financial Conduct Authority (FCA) has today provided an update on its investigation in to Royal Bank of Scotland’s (RBS) treatment of small and medium-sized enterprise (SME) customers transferred to its Global Restructuring Group (GRG).
Read the full statement.
Commenting on the update Andrew Bailey, FCA Chief Executive said:
'Given the serious concerns that were identified in the independent review it was only right that we launched a comprehensive and forensic investigation to see if there was any action that could be taken against senior management or RBS. It is important to recognise that the business of GRG was largely unregulated and the FCA’s powers to take action in such circumstances, even where the mistreatment of customers has been identified and accepted, are very limited. Taking action was therefore always going to be difficult and challenging but after carefully considering all the evidence we have concluded that our powers to discipline for misconduct do not apply and that an action in relation to senior management for lack of fitness and propriety would not have reasonable prospects of success.
'We have consulted with independent, external leading counsel who has confirmed that the FCA’s conclusions are correct and reasonable.
'I appreciate that many GRG customers will be frustrated by this decision but we have explored all the options available to us before arriving at this conclusion.
'The fact that we can’t take action in no way condones the behaviour of RBS. We expect high standards from the firms we regulate and RBS fell well short in its treatment of GRG customers.
'We feel strongly that those companies that have suffered loss as a result of how they were treated whilst in GRG must be appropriately compensated. We are closely monitoring the complaints process overseen by Sir William Blackburne, an independent third party, to ensure that things are put right.
'Although commercial lending to SMEs is not regulated by the FCA, the Senior Managers Regime (introduced in 2016) means that we are now able to hold senior management of banks to account for the way that they treat their SME customers and the FCA will do that.'
Notes to editors
On 1 April 2013, the FCA became responsible for the conduct supervision of all regulated financial firms and the prudential supervision of those not supervised by the Prudential Regulation Authority.
The FCA has an overarching strategic objective of ensuring the relevant markets function well. To support this it has three operational objectives: to secure an appropriate degree of protection for consumers; to protect and enhance the integrity of the UK financial system; and to promote effective competition in the interests of consumers.
Find out more information about the FCA.
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