Fed orders RBS to run a tighter ship

ROYAL Bank of Scotland last night pledged to improve control over its operations in the United States after the Federal Reserve ordered it to tighten up its risk management.

RBS has 60 days to submit a written plan showing how it will "strengthen board and senior management oversight of the corporate governance, management, risk management and operations" at the bank, the US banking regulator said.

A similar "consent order" was issued last year against Barclays.

Stephen Hester, RBS's chief executive, said: "We set and expect higher standards than those that resulted in this order.

"RBS is well advanced in addressing the deficiencies noted by the US banking authorities and in continuing to upgrade our governance and compliance systems throughout the group."