Risk assessment took back seat at RBS levfin, says FSA
The FSA’s report on the failure of the Royal Bank of Scotland has underlined the role played by the bank’s leveraged finance business, which it decided to expand in June 2006. RBS made mark-to-market losses of £287m on its leveraged finance portfolio in 2007 and £1.088 in 2008, the report said.
RBSs timing could not have been worse, it would appear, and "the high level of losses was a direct result of the increased portfolio generated in the first half of 2007".
The report highlights the limited consideration given to distribution risk by the RBS Board when it decided to
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