RBS boss blames lower tier staff for poor crisis handling

The chief executive made the comments during an hours-long grilling in front of the Treasury Select Committee on Tuesday, where MPs asked who was ultimately to blame for the failings of behaviour at the Global Restructuring Group (GRG).

“Well I think it has to be the senior executive of that operation that takes the accountability,” he said, suggesting blame would not be placed on boardroom leaders of the bank.

“We’ve actually got a number of people whose pay and long-term pay has been suspended while these reviews go on and while the FCA (Financial Conduct Authority) does their review as well,” he added, referring to those connected with the management of the GRG during the period in question. A small number of those are still employed by RBS.

The state-backed lender has been dogged by allegations that it intentionally pushed small businesses towards failure in the hope of picking up their assets on the cheap.

The FCA is still investigating whether to take further action over the unit’s actions between 2008 and 2011 after publishing a summary report into GRG last year.

RBS had claimed the vast majority of businesses were successfully turned around by GRG, but Mr McEwan admitted its definition included businesses going into liquidation.

Mr McEwan said: “Let me be quite clear with the committee: we did not do a good job with these customers and the report shows that - we did not do a good job.

“At the time when they were in most need of help this organisation in many, many cases and far too many cases was not there giving them the help they needed.”

When pressed, Mr McEwan admitted there “may well have been cases” where staff at GRG had been insensitive or aggressive in their treatment of struggling firms despite previously disputing these findings by consultancy Promontory which was commissioned to write a report on the unit.

Previously undisclosed memos were released this month showing GRG staff being encouraged to apply pressure and extract money from customers.

One memo, entitled Just Hit Budget!, which was written in 2009 talks of applying particularly high interest rates, which could then be reduced if customers signed over a stake in their business or property.

RBS has insisted the memo was written by a junior manager, did not form part of GRG or bank policy and that the language was “completely unacceptable”.

But Tony Boorman, MD of Promontory, which wrote the GRG report for the FCA, told MPs: “It did speak something around the culture of the bank at that time and we saw other comments on file at various points that were kind of similar in tone and spirit to the ones that you’re quoting.”