17th Jan 2014 11:57
LONDON (Alliance News) - A UK regulator Friday said it has appointed two firms to investigate Royal Bank of Scotland Group PLC's treatment of business customers in financial difficulty.
The Financial Conduct Conduct Authority said it has appointed Promontory Financial Group and Mazars to conduct an independent report to investigate RBS's treatment of struggling businesses.
It said it expects to publish the outcome of the review in the third-quarter of 2014, and will consider "further regulatory measures" if the findings reveal "issues" which come under its remit.
RBS, which is 82% owned by the UK government after its bailout during the financial crisis, has come under fire from government adviser Lawrence Tomlinson, and has been accused of forcing small businesses in financial difficulty into its Global Restructuring Group.
Tomlinson's report included accusations that RBS deliberately drove small businesses to collapse in order to buy their assets cheaply during the financial crisis.
A second report by former Bank of England deputy governor Andrew Large and published Monday, also noted that some small businesses had made "extreme accusations about RBS's handling of relationships with customers (particularly with respect to customers facing difficulties or distress)."
In November, RBS Chief Executive Ross McEwan admitted that Andrew Large's review wouldn't make for comfortable reading.
"The review will also consider whether any poor practices identified are widespread and systematic. If this is the case, the second stage of the review will identify the root cause of these issues and make recommendations to address any shortcomings identified," the FCA said in a statement.
UK Business Secretary Vince Cable has previously said he was "appalled" by the allegations against the bank and referred the report to City regulators.
By Samuel Agini; [email protected]; @samuelagini
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