UK regulator urged to release report into RBS’s turnaround unit
LONDON (Reuters) – Britain’s financial regulator should release a leaked report about Royal Bank of Scotland that alleged many companies suffered from “inappropriate action” by its Global Restructuring Group unit, a senior British lawmaker said.
Nicky Morgan, who chairs parliament’s Treasury Select Committee, wrote to Andrew Bailey, chief executive of the Financial Conduct Authority (FCA), in a letter released on Thursday asking him to release the long-delayed report.
The FCA last year published a summary of the initial findings of an investigation that cleared RBS of the most serious allegation that the bank systematically killed off healthy businesses for profit.
But the full report, seen by the BBC, found struggling companies placed in the restructuring unit had a slim chance of emerging.
Only one in 10 of the troubled businesses put into the unit ever ended up returning to health, according to the report seen by the BBC.
“Nearly a year later, and nearly four years since the report was commissioned, we are still waiting for answers,” Morgan said. “The balance has tipped firmly in favour of full publication.”
The FCA said it would respond in due course and was conducting an inquiry into the leak of the report to the BBC. It has also asked RBS and consultancy Promontory, which also had access to the report, to conduct similar investigations.
“If the Treasury Select Committee or the BBC have evidence that the document was leaked by the FCA, we encourage them to share that with us,” the FCA said in a statement.
RBS’s restructuring unit had been accused of pushing some companies into bankruptcy so it could pick up their assets more cheaply in the aftermath of the global financial crisis.
The state-backed bank has admitted some wrongdoing over its handling of small businesses, but has said there was no evidence it pushed companies into bankruptcy.
RBS declined to comment on Morgan’s letter.