RBS staff boosted bonuses in ‘dash for cash’ project

Royal Bank of Scotland staff were promised higher bonuses if they sent struggling firms to the wall during the financial crisis in a project dubbed “dash for cash”.

Serious allegations about RBS’s notorious Global Restructuring Group resurfaced on Monday, just one week after the final report on the bank subsidiary went to the City watchdog.

Documents seen by Newsnight and Buzzfeed suggest bankers were encouraged to buy assets on the cheap from firms that were deliberately forced towards failure.

RBS admit they let some firms down but deny deliberately causing them to fail.

Staff were encouraged to find ways to “provoke a default” at firms, sometimes by shoving up interest rates, it is claimed.

The allegations first surfaced three years ago in a report by government consultant Lawrence Tomlinson. The latest memos would appear to throw serious doubt on RBS’s claim that GRG was not a profit centre for the bank.

Jon Pain, the chief conduct and regulatory affairs officer at RBS, said on Monday: “In the aftermath of the financial crisis we did not always meet our own high standards and we let some of our SME customers down.”

He added: “In 2008 the numbers [of distressed SMEs] moving into GRG rose by over 400%. We should have coped better but between 2011 and 2013, GRG advanced over £100 million of new lending and successfully restructured thousands of SMEs, saving tens of thousands of jobs.”