UK watchdog takes no action against RBS over small business unit
"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," Andrew Bailey, FCA chief executive said.
"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." ■