Bank rows - the series returns, again
Royal Bank of Scotland has maintained a pretty steady line about the behaviour of its notorious (and disbanded) ‘restructuring division’ [also known as the Global Restructuring Group]. Nothing to look at here, move along now, has long been the message.
Even when it announced back in November that it was to pay £400m compensation to customers that went through the GRG wringer, the bank did its best to maintain some semblance of propriety. GRG’s actions "…did not result in material financial distress to customers", in the majority of cases, it claimed, nor did executives "artificially engineer" the transfer of a customer to GRG.
That’s what the bank says, but what about those on the ground? An interesting voice emerged last week from a court hearing in the £400m Stuart Wall versus RBS claim. Evidence presented during a pre-trial hearing detailed how managers at the bank discussed “repricing” the hundreds of millions of pounds worth of loans that are at the heart of the current dispute.
An email from 2009 stated: “We intend to reprice the facilities by way of back-ended fees and increased margin on Tufnell Park [one of the assets].” Another said: “We will need to take exit fees or profit share to get the right reward where cash is limited.”
Repricing loans, imposing back-ended fees and increasing margins is exactly the sort of thing that customers have been complaining about for so long.
As it turns out they weren’t alone. Last week it was disclosed at the case management conference that one long suffering RBS employee reacted to the emails above with this message to a colleague: “Please, please, please get me a pass out of this organisation, once called a bank, as soon as you can…”..