RBS share price: MPs concerned by ‘rebranding’ of turnaround unit

Bank admits most turnaround staff previously worked for GRG

RBS share price: MPs concerned by ‘rebranding’ of turnaround unit

MPs have raised concerns that three-quarters of the staff and nearly all the senior managers at Royal Bank of Scotland Group’s (LON:RBS) new turnaround division previously worked at its controversial Global Restructuring Group (GRG), the Guardian reports. The news comes after MPs recently published the Financial Conduct Authority’s (FCA) report into the division, which uncovered ‘systematic’ poor treatment of companies. 

RBS’ share price has lost ground in London in today’s session, having given up 0.67 percent to 268.60p as of 10:26 GMT. The group’s shares are underperforming the broader UK market, with the benchmark FTSE 100 index having slipped marginally into the red and currently standing 0.25 percent lower at 7,264.49 points.

GRG ‘rebranding’

The Guardian reported yesterday that the Treasury Select Committee had said that said that 136 of 182 employees at RBS’ current restructuring business and 30 out of 32 senior managers had come from GRG. At a select committee hearing last month, the lender’s boss Ross McEwan, said that he believed that only two senior managers had come from GRG, including the head of restructuring, Laura Barlow. RBS now said that this comment referred to only the most senior management grade.

“Mr McEwan has assured the committee that the culture at RBS Restructuring is fundamentally different from that of GRG,” the committee’s chair Nicky Morgan commented, as quoted by the Guardian. “The discovery that almost all the senior management in the new unit previously worked at GRG raises concerns that there has merely been a rebranding exercise.”

‘Fundamental change’

The Telegraph meanwhile quoted a spokesman for the bailed-out lender as saying that “the culture, structure and way RBS operates today have all changed fundamentally since the period under review,” and that the bank’s focus now was on rebuilding trust and supporting customers.

As of 10:58 GMT, Wednesday, 28 February, Royal Bank of Scotland Group share price is 268.30p.

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