FSA admits 'flawed' supervision of RBS

Royal Bank of Scotland(RBS) nearly collapsed in 2008 because of poor management, inadequate regulation and a flawed supervisory system, a Financial Services Authority report published today says.

The FSA admits its own supervision was "flawed" and "provided insufficient challenge" to RBS, the BBC reports. However, it did not concede these shortcomings amounted to negligence. It says RBS' capital position was too weak to proceed with the £49bn takeover of parts of the Dutch bank ABN Amro at the height of the financial crisis in 2007. RBS, which is now 83%-owned by the UK government, has cut 27,500 jobs since the beginning of the financial crisis. Propping up the bank cost the taxpayer £45bn in direct financial support and hundreds of billions more in state-guaranteed loans a...