June 23, 2015 – RBS chairman Philip Hampton has said scandals such as Libor-rigging can no longer be tolerated as he acknowledged the damage caused by the £10 billion fines imposed against the bank.
At the RBS annual general meeting, Mr Hampton said he recognised work needed to be done to improve banking culture.
“The recent fines enforced on banks including RBS for Foreign Exchange and Libor manipulation speak to that and are examples of behaviour that cannot be tolerated,” Mr Hampton told shareholders gathered at RBS headquarters at Gogarburn, Edinburgh.
“The scale of the conduct issues faced by RBS has markedly reduced our ability to retain earnings, delaying our capital re-build and directly reducing shareholder value.”
The most recent controversy to dog the bank was an embarrassing computer “glitch” that prevented 600,000 payments from going through.
But Mr Hampton said the bank had been “transformed” since 2009, when the bank was bailed out by the taxpayer with more control over risks.
Looking back to the financial crisis, Mr Hampton said RBS had been “over-stretched, over-exposed and underpowered in key areas.”
He added: “We had to reassure our customers, our shareholders and our regulators that the bank was not going to fail again. The RBS of today is very different from the bank of 2009. It has been transformed and repositioned with a focus on the quality of our earnings and the control of our risks. There is still, of course, work to be done to get RBS into a position where it will deliver an acceptable return on equity.”