A Two for you, one for me admittance of failure was the theme of a much-anticipated report released by the UK Financial Services Regulator (FSA) this week into the spectacular collapse of Royal Bank of Scotland (RBS).
The soon-to-be-disbanded FSA was accused of falling asleep at the wheel as RBS and a few major banks drove the sector and with it the British economy into the rocks – yet managed to stay awake enough to bully the financial advice industry into submission!
Monday’s part-admittance of failure by the FSA fell a little flat, given it came three years after the event and offered little to no solace to the British Treasury or taxpayer, which coughed up near to £50 billion in direct bank bailouts (ignoring the £450 billion that was made available on October 8, 2008 for short term loans and guarantees if and when needed).
This week’s report was an improvement on the miserly 298-word pathetic briefing the FSA released in 2010 loosely explaining how the collapse of RBS had manifested.
Fred the Shred Goodwin, the then CEO of RBS, built up an unserviceable reliance on short-term funding as he presided over a growth in asset value to £1.9 trillion, before a spectacular collapse once the 2008 crisis kicked in.
RBS delivered the worst annual loss in UK corporate history, the year it was nationalised, after shedding £24.1 billion.
Yet while the gung-ho bankers were playing Russian Roulette, the FSA was picking on small firms and advisers in the run-up to the Retail Distribution Review (RDR).
Some claim the toothless approach that the FSA showed to the large institutions was partly because the compliance divisions of the big banks are where regulators go in their next career path.
Banking insiders even quip that Hector Sants, the then CEO of the FSA is the only chief executive of a financial institution not only to have survived the crisis but to have been promoted.
Sants is to join the Bank of England as deputy governor, head of financial supervision, in 2012.
So what did the FSA admit to?
– The regulator had too few staff overseeing RBS in August 2007. Six versus 23 today.
– FSA officials were barred from meeting one-on-one with RBS’s non-executive directors.
– FSA did not stand up as a force to be reckoned with against the “vigour of pushback” by RBS against its oversight.
– The regulator was apparently concerned about being accused of “heavy-handed, gold-plating”.
RBS was bailed out by UK taxpayers in 2008 in a deal which delivered a reluctant British Government control of 83pc of the bank.
The timing of this report does little to change what has already happened of course and irks those who wanted to see somebody brought to account for the fiasco.
Britain’s national balance sheet is all the weaker as a result of the failings of both the FSA and also the reckless growth at all costs abandon of the likes of Mr. Goodwin.
As Christmas approaches, few of those who have personally suffered as a result of the economic slump are likely to be spared a thought by those who had a significant role to play in the debacle (from a UK perspective) but have had to expend limited to no personal capital themselves as a result.
It is this sense of injustice that has been particularly hard to swallow by the British public. unshaven girl онлайн займ с плохой кредитной историейзайм без электронной почтыоформить займ на карту срочно