A report from the Financial Services Authority published this past December harshly criticised RBS executives, calling them unfit to run a banking provider.
FSA chief executive, Hector Sants, stated that those responsible for near-failure of the personal and business bank account provider in 2008 would be hard-pressed to find work in the industry anywhere following the Authority’s 450 page report. While the FSA chose to not take an enforcement action against the RBS executives, Mr Sants said that the reports findings would ‘effectively blackball’ them.
The FSA has taken steps to ensure the failures of the past are not repeated by eliminating the possibility of those responsible for the catastrophe from finding work again. In one example, Johnny Cameron, the former investment banking head of RBS, struck a formal agreement with the FSA, with the watchdog eschewing any enforcement action against him in return for his vow to never work in the banking industry in any significant capacity ever again.
Mr Sants said that there was a long series of failures by RBS executives over a long period of time, leading him to believe that they have no business running a regulated institution. He was sure that those responsible will not work again in the sector, as none of the former executives had applied for authorisation – though he expressed confidence that any appointments would be blocked.
RBS – whose bank branches are 82 per cent taxpayer owned thanks to a massive government bailout – was originally not regulated as an investment banking institution until the onset of the credit crunch in 2007. Since them, Mr Sants and his team have been responsible for oversight on the beleaguered banking institution.