U.K. Regulator Refuses Lawmaker Request to Publish RBS ReportBy
FCA’s Bailey said public interest not served by publishing
RBS came under fire over its business lending practices
The head of the U.K. Financial Conduct Authority denied a lawmaker’s request to publish a report into the business lending practices of Royal Bank of Scotland Group Plc, saying releasing the documents isn’t in the best interests of the public.
Replying to a letter from Parliament Treasury Committee Chair Nicky Morgan, Andrew Bailey said he didn’t think there is a case for full publication. The FCA would provide a more detailed summary of the report once the agency made a decision on opening a formal investigation into RBS’s behavior, he said.
The response comes after Morgan wrote to Bailey last week demanding the report be published following a leak to the BBC in August.
"I recognize that the public interest justifies greater disclosure of material in the report," Bailey said in the letter sent Monday. "The summary is largely ready for publication once we have reached a conclusion on the need for a formal investigation."
The report was the result of a look into RBS’s practices involving clients referred to its so-called Global Restructuring Group, or GRG. The review began after a government consultant claimed in 2013 the bank had pushed small companies that owed it money into difficulties to help bolster earnings. Following the allegations, the FCA appointed Promontory Financial Group LLC, a consulting firm, and the accountant Mazars in 2014 to review RBS’s conduct.
RBS said in November it would take a 400 million-pound ($528 million) charge to cover refunded fees to small-business customers after a review of clients referred to its GRG unit between 2008 and 2013. In a summary published at the same time, the FCA said the probe had found some examples of “poor practice” but that RBS hadn’t set out to artificially transfer customers to its restructuring unit.
“Seven years since it was shut down, there are still conflicting accounts of what really happened to customers referred to GRG," Morgan said in a statement accompanying the letter released Friday. "The leak and selective reporting of the skilled persons’ report, which the FCA has had for almost a year, has added to the confusion. This situation is unsustainable."