It looks like RBS bosses have got what they hoped for. An investigation by the Financial Conduct Authority (FCA) has cleared Royal Bank of Scotland (RBS) of some of the most serious allegations against it - but has pointed to failures in conduct.
RBS has been accused for forcing small and medium-sized firms into its global restructuring group (GRG), then profiting from their financial distress - with some suggesting GRG charged high fees and took either partial or full control of scores of businesses.
But in a report published today the FCA said it had seen no evidence of widespread practice of RBS identifying customers to transfer into its GRG, nor did GRG routinely request personal guarantees and/or cash injections when it had already decided not to support those businesses.
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But it did point to failures, including poor communication from RBS, little support for small firms in a manner consistent with good turnaround practice, and failure to explain its rationale behind certain decisions, including how GRG priced its services.
"Some elements of this inappropriate treatment of customers should also be considered systematic as it resulted from a failure on the part of RBS to fully recognise and manage the conflicts of interest inherent in GRG’s twin commercial and turnaround objectives and to put in place the appropriate governance and oversight procedures to ensure that a reasonable balance was struck between the interests of RBS and SME customers," the report added.
The news comes on the day RBS said it has set aside £400m as compensation to small firms caught up in the scandal.
In a statement this morning it said it has launched a new complaints review process, to be overseen by Sir William Blackburne, a retired high court judge, and an automatic refund of complex fees paid by small business customers of GRG.
"We have acknowledged for some time that mistakes were made," said Ross McEwan, the lender's chief executive.
"Some of our customers went through what was a traumatic and painful experience as a result of the crisis. I am very sorry that we did not provide the level of service and understanding we should have done."