The bank’s chairman Sir Philip Hampton and the chief executive Ross McEwan were challenged on a series of issues at RBS’s annual meeting at its Gogarburn headquarters outside Edinburgh.
Faced with calls to end the closures of local branches, Mr Hampton and Mr McEwan were reminded of RBS’s 2010 pledge that it would not “close the last bank in town”.
Mr Hampton admitted that the bank could no longer keep that promise with more custom-ers moving from traditional to online banking.
He said the scale of the move to online banking had not been foreseen when the promise was made.
Since then there had been a “massive” 36 per cent decline in branch use.
Some branches, he claimed, were only being used by one or two people a week.
Meanwhile there had been a 300 per cent “explosion” in online banking.
The change in banking habits could be illustrated by the fact that RBS’s busiest branch was now the mobile service on the Reading to Paddington com-muter train.
“We can’t go on doing the wrong things simply because a few years ago we made the wrong decision,” Mr Hampton said.
The bankers were also chal-lenged on local authorities being charged high interest rates on “complex and risky” loans.
Asked about the so-called “lender option, borrower op-tion”, Mr Hampton said it was very difficult to talk about spe-cific interest rates.
Also under fire was the bank’s Global Restructuring Group which is alleged to have pushed small businesses into adminis-tration to take control of their assets and sell them at a profit.
Shareholder Neil Mitchell ac-cused Sir Philip of failing to act on the issue.
Mr Hampton said scandals such as Libor-rigging can no longer be tolerated.