The Royal Bank of Scotland Group  

MPs demand answers from RBS boss on failings

MPs demand answers from RBS boss on failings

The chief executive of Royal Bank of Scotland will be called before MPs later this month to explain the bank's behaviour towards struggling businesses.

Ross McEwan will appear before the Treasury Select Committee towards the end of the month but a date has not been confirmed yet.

The bank’s Global Restructuring Group division was a business support unit for troubled firms but was accused of artificially distressing otherwise viable businesses and putting them on a journey to administration, receivership and liquidation.

Investigators from Promontory, the firm which produced an independent report into GRG on behalf of the Financial Conduct Authority, will also appear before MPs later this month.

That review, which was published last year, found that while RBS did not set out to artificially engineer the transfer of companies to its business support division, there were “isolated examples” of poor practice. 

These include the failure to support SME businesses “in a manner consistent with good turnaround practice” and focusing too much on pricing increases and debt reduction “without due consideration to the longer-term viability of customers”.

RBS, following the publication of the review’s findings, announced a new complaints review process overseen by Sir William Blackburne, a retired High Court judge.

The bank said it has made refund offers for complex fees of more than £115m and the cumulative cost of the measures it has taken in response to this issue have been £440m.

UK taxpayers still own 73 per cent of RBS, after the government bailed out the bank in the wake of the 2008 financial crisis.