Legal challenges delay report on RBS collapse

Published on Saturday 23 April 2011 13:16

A REPORT by the City regulator into what caused Royal Bank of Scotland to implode is being delayed by legal challenges orchestrated by ex-directors of the bailed-out institution, including former chief executive Sir Fred Goodwin.

The Financial Services Authority had been expected to publish its findings by the middle of this month and a draft is understood to have been in the hands of RBS's legal team for weeks.

The report is said to have become mired in dispute as former directors seek to deflect criticism for their roles in the 2008 crisis.

A source with knowledge of the investigation said: "Some of the individuals involved are unhappy with elements of the report and some of the assertions that have been made."

RBS had to be saved from collapse following the disastrous takeover of Dutch rival ABN Amro with a 45 billion bail-out from the government. The bank is now 83 per cent owned by the taxpayer.

The FSA cleared Goodwin and fellow directors of wrongdoing late last year, but refused to publish its findings. The regulator was forced to back down under pressure from Chancellor George Osborne and Business Secretary Vince Cable.

Confidentiality rules surrounding the investigation have complicated the report's publication. The FSA has had to seek the permission of dozens of executives who were interviewed before making its findings public.

Last week, at the bank's annual general meeting, RBS chairman Sir Philip Hampton said the FSA report was now the subject of a "bit of to-ing and fro-ing between the lawyers". The bank's legal team was examining the FSA findings "under legal privilege".