RBS Complaints Process and Refund of Complex Fees for SME customers in GRG

UPDATED 12 May 2017 – Progress Update

We thought it would be helpful to provide an update on the progress made since we announced in November 2016 the two important steps we are taking for customers in GRG between 2008 and 2013. This is a complicated process and will take time to complete but our focus now is on assessing the complaints that we have received and completing the automatic refund of complex fees.

We have updated the FAQ relating to how the automatic refund of complex fees will work – specifically the point on interest payments.

We said on the day of the announcement that the purpose of the automatic refund of complex fees was to save customers from further delay, ensure that the bank can start refunding fees more quickly and demonstrate our commitment to addressing issues of the past.

Having investigated the proposed approach to the payment of interest on the prevailing (credit or borrowing) rate applicable at the relevant time to the account which the fees were charged we realised we would not be meeting the main objective of the process. Customers would end up waiting much longer because rebuilding every customer account and individually calculating the interest each day could take many months.

Therefore, and to ensure we make payments to customers as quickly as possible, we have decided to calculate the payment at a rate of 8% simple per annum. This will be added for every day since the fee was paid to the date of the payment, or, where you receive an outcome letter including this payment, to a date 28 days following the date of the outcome letter.

On this web page, we have shared a range of documents that will help customers understand the new complaints process, what to consider when making a complaint and the journey through the process. We’ve also shared the answers to a number of frequently asked questions and will continue to provide updates as required.

If any customers have any questions, please contact the GRG Customer Helpdesk using the contact details below.

Automatic refund of complex fees

Since its announcement last November the bank has:

Complex Fees:

  • Completed its review of over 4,600 customer files to establish whether they were charged complex fees whilst in GRG.
  • Written to 3,263 customers, including 1,558 due refunds totalling £30m.

PPFAs and EPAs:

  • Reviewed 578 of 826 customers who entered a PPFA and/or EPA agreement whilst in GRG.
  • Written to 188 customers, including 40 with offers of £9m.

Voluntary Payment of Interest:

  •  Commenced sending interest “top up” refund letters to those customers who have already received an outcome letter.

We expect to have substantially completed the refunding of Complex fees and review of PPFAs and EPAs by July 2017.

GRG complaints process

Since its announcement in November, the bank has received 653 complaints from eligible customers. These complaints are now being assessed by the bank. If any of these customers are unhappy with the bank’s decision, they will have the opportunity to refer their complaint to the Independent Third Party. We would encourage any customers with concerns about their treatment in GRG during the relevant period to get in touch. Details of the eligibility criteria for access to this process are contained in the FAQs below.
 

The Independent Third Party has now completed his review of the Complaints Process design and governance arrangements, and provided his sign off. The assurance of the process has started.

The bank has also received Sir William’s first Quarterly Report, which can be read below:


ITP Quarterly Report – Q1 2017 [PDF2.6MB]

  • How can I tell if I should make a complaint?

    If you feel dissatisfied about the way you were treated whilst in GRG, regardless of whether it is in relation to one of the failings outlined in the FCA’s announcement, you should consider making a complaint.

    We recognise that some customers may not be sure whether to complain about what happened to them because they have nothing to benchmark their experience against. We have therefore set out below some points that you may find useful if you are trying to work out whether or not you should make a complaint.

    We would suggest that you think about a complaint arising either as a result of:

    1. The actions of the bank – ‘what the bank did’
    2. The conduct or behaviour of bank employees – ‘how the bank acted’

    The FCA, in its announcement on 8 November 2016, referred to the eight areas in which the inappropriate treatment of SME customers by RBS was identified in the Skilled Person’s report as being widespread. Points 1-7 below relate to the actions of the bank and point 8 relates to the conduct of bank employees.

    We would encourage you to read these carefully as you consider whether to raise a complaint. We have set out below how these may give rise to customers feeling they have cause for complaint.

    1. Communications about transfer from mainstream banking into GRG

    If the bank was concerned about a customer’s ability to repay its debt or the underlying financial position of the business then transferring the customer to GRG was in line with the bank’s policy, even if the customer remained confident about their ability to repay the debt in future.

    However, a customer should always have received clear communications that set out the reason(s) they were being transferred to GRG. If you were unclear about the reasons for your account’s transfer, or the implications of transferring your account, or the process of being transferred then you may wish to consider making a complaint.

    We understand that some customers may disagree with our decision to transfer them to GRG, but this decision was based on defined criteria. Therefore, a complaint solely about the fact you were transferred is unlikely to be upheld unless you can demonstrate that your account did not need to be transferred. If any inappropriate treatment then occurred whilst you were in GRG you may like to consider the following points.

    2. Turnaround practice

    The bank has to consider a number of factors, including its lending risk appetite and capital prudential requirements, when deciding who to lend money to or whether to continue to support a customer who may be in breach of their existing facilities.

    However, the bank should always act reasonably and consider the impact on the customer’s business. It should properly consider any realistic proposals presented by a customer. If you feel that the bank acted unreasonably or rejected realistic proposals to support your business whilst it was in financial distress, without due consideration, then you should consider making a complaint.

    Providing any support to a business in financial distress may result in additional fees or increases in the cost of borrowing being charged by the bank. These should be reasonable and should be clearly explained to a customer. If you feel this was not the case you should also consider making a complaint.

    When considering your complaint, please note that disagreeing with the bank’s final decision on whether to provide you with additional time (‘forbearance’), additional lending or a debt write-off will not necessarily be sufficient grounds for a complaint to be upheld in its own right.

    3. Communicating decisions

    The bank used a variety of different fees or pricing tools to reflect the increased cost of risk associated with customers in financial difficulty, and sometimes charged fees that our SME customers were not familiar with, either because they were not of a type commonly used, or because they were a bespoke pricing instrument.

    The bank should have always made sure that the reason for, and level of, any pricing changes or fees charged were clearly explained. If you were unclear about the reasons for any price changes or fees charged then you may wish to consider making a complaint. You may also wish to complain if you believe there were other significant decisions made by the bank that were not well explained.

    We are automatically refunding the complex fees that were paid by SME customers in GRG during the period 2008-2013. For customers who are eligible for the automatic fee refund process there is no need to make a complaint in order to receive this refund. Please refer to the FAQ’s on complex fees.

    4. Valuations

    Valuations were undertaken by the bank for a number of reasons, for example:

    • to ensure the property valuation complied with any loan requirement set out in loan covenants
    • to assess the bank’s risk position for its lending exposure against its loan security profile, and
    • to determine pricing and/or strategy in accordance with the bank’s risk profile.

    If you believe the bank inappropriately carried out a valuation of your property, or used the basis of that revised valuation in an inappropriate way in dealing with your account, then you may wish to consider making a complaint. If the bank based a decision on an internal valuation which you had challenged, without giving you an opportunity to carry out an independent valuation, and you can demonstrate that the valuation used was inaccurate then this may also be grounds for complaint.

    Where the valuation process and result was poorly communicated, but the resulting valuation is seen to be reasonable, your complaint is unlikely to be upheld in respect of the consequences arising from the valuation process.

    5.    Handling complaints

    The Financial Conduct Authority*, has set out clear guidance on how banks should deal with complaints promptly and fairly, including relevant complaints that could be referred to the Financial Ombudsman Service (FOS)*. The bank is committed to adhering to this best practice guidance to ensure that it deals with all complaints fairly, with integrity, and with rigorous standards and timescales.

    The bank has acknowledged that it did not always handle customer complaints well, for example it did not always identify when a complaint was being made and so did not record it as a complaint or respond to it. It didn’t always advise customers of their rights to complain (where eligible) to the FOS*.  If you have complained previously and do not consider that your complaint was dealt with fairly (or at all), then you may wish to resubmit your complaint.

    However, we will not reconsider any complaints that have already been the subject of:

    • a full and final settlement of litigation or litigation threatened in a letter before claim
    • a decision by the FOS*, or
    • a decision of the courts.

    *For customers in the Republic of Ireland, the relevant guidance will be from the Central Bank of Ireland and the Financial Services Ombudsman (FSO).

    6.  West Register

    The bank has acknowledged for some time now that there existed a perception that the bank had a conflict of interest when it purchased a property as part of a restructuring process. If you had a property acquired by West Register and believe the process was not managed appropriately, or that the actions of West Register were unfair, then you should consider making a complaint.

    7. Use of complex instruments

    The bank used a variety of different fees or pricing tools to reflect the increased cost of risk associated with customers in financial difficulty, or as a means to restructure borrowing for customers. In some cases this included the use of:

    • Equity Participation Agreements (EPA) where the bank received an equity stake in the business in return for providing equity risk finance or taking equity risk, and
    • Property Participation Fee Agreements (PPFA) where the bank received a share in the value of a property in return for providing support by way of forbearance, debt forgiveness and/or additional facilities.

    The intention of these instruments was to align the objectives of the bank and the customer so that both could share any future value created when the customer returned to financial health. However, for SME customers in GRG during the crisis, some of these upside instruments were not always properly communicated or were not explained clearly enough.

    We are proactively contacting SME customers who were in GRG during the period 2008-2013, to discuss releasing them from their obligations under any EPA or PPFA. We will also refund any complex fees that may have been charged in relation to these products. For customers who are eligible for the automatic fee refund process there is no need to make a complaint in order to start this process.

    While we have not conducted a review of the specific circumstances of each fee charged and therefore the automatic fee refund is made on a voluntary basis, please note that receiving an automatic fee refund does not prevent you from making a complaint if you feel that a specific fee should not have been charged in the first instance.

    8.    Conduct

    The bank expects its staff to behave appropriately and treat customers fairly at all times. The standard approach to record keeping, however, is to record ‘what’ actions were taken and not ‘how’ these actions were carried out.  So it is likely that we will need to rely on customers providing supporting evidence for any complaint they wish to make about staff conduct.

    If you believe that any of our staff behaved inappropriately or treated you badly you should consider making a complaint. Please include any relevant evidence, such as correspondence via email or post.

    Our complaint form includes an area for you to tell us what you would like the bank to do if your complaint is upheld. This is important because, provided the actions of the bank were not inappropriate, it is unlikely that you will have suffered any financial impact as a result. Given this, the likely outcome where this kind of complaint is upheld is that the bank will apologise for how its actions made you feel, but that you will not receive any financial offer.

On 1 February 2017, we updated the Complaints process principles document to provide further detail about the process for offers made by RBS and appeals to the Independent Third Party.

New complaints process principles [PDF 71KB] 

If you have already read the document then the key changes are outlined below for ease of reference:

  • Paragraphs 4.7 and 5.1 now provide further detail about offers by RBS and when they will lapse.
  • Paragraph 5.2 now provides further detail about how to make an appeal to the Independent Third Party.
  • New paragraphs 5.5, 5.6 and 5.7 provide detail about the process following an appeal decision, including final offers by RBS and when they will lapse.

We also added new documents to help our customers in the Republic of Ireland:

  • Our commitment to the Consumer Protection Code (CPC) and The Central Bank (Supervision and Enforcement) Act 2013 (Section 48) (Lending to Small and Medium-Sized Enterprises) Regulations 2015 (the “SME Regulations”).
  • An updated version of the customer journey through the complaints process. This has been changed only to acknowledge the regulatory differences between the UK and the Republic of Ireland.
  • FAQs for new complaints process principles

    A) What is meant by changes to the “banking relationship”?

    This refers to any aspects of a customer’s current banking arrangements with RBS that need to be amended as a result of an upheld complaint, for example changes to the interest rate, loan covenants or security arrangements.

    B) What do you mean by goodwill payment?

    In some circumstances where a complaint is upheld but there is no direct loss, RBS may make a discretionary goodwill payment to a customer to reflect the probable financial impact of the disruption that was caused to their business.

    C) What do you mean by direct losses?

    For the purpose of the new complaints process, 'direct loss' means sums of money paid by a customer to RBS or a customer’s out of pocket costs of meeting RBS’s requirements that were a direct result of an upheld complaint. Examples include:

    • arrangement fees
    • renewal fees
    • excess fees
    • increased interest payments made to RBS by a customer
    • costs and expenditure incurred by a customer in connection with an independent business review, a valuation report, a security review, or other actions required by RBS, or
    • costs and expenditure incurred by a customer for the appointment of a third party to the customer at the request of RBS.

    D) What is DISP?

    The Financial Conduct Authority published its complaints handling rules as part of the FCA Handbook, within the section entitled “Dispute Resolution: Complaints”.

    These rules – sometimes referred to as the “DISP” rules – set out the procedures and requirements that businesses must follow when handling complaints from consumers. The rules include requirements on:

    • acknowledging and responding to complaints;
    • the time-limits for dealing with complaints; and
    • record-keeping and reporting.

    We will publish a separate document that clearly sets out our commitment to DISP.

    DISP Dispute Resolution: Complaints is available on the FCA’s website: https://www.handbook.fca.org.uk/handbook/DISP/

    E) Who is DISP eligible?

    The DISP rules apply to the handling of complaints from consumers that are “DISP eligible”, meaning (generally) that they meet the following criteria:

    A complaint:

    • regarding financial products and services;
    • provided in or from the UK;
    • brought by, or on behalf of, a customer or potential customer who is:
      • a private individual;
      • a micro-enterprise (meaning an enterprise which employs fewer than 10 people and has an annual turnover or balance sheet that does not exceed €2m at the time of making the complaint);
      • a charity which has an annual turnover of less than £1m at the time of making the complaint; or
      • a trustee of a trust which has a net asset value of less than £1m at the time of making the complaint.

    DISP eligible complainants also have the right to refer their complaints to the Financial Ombudsman Service (FOS) for consideration and adjudication.

    In summary, following the raising of a complaint to the bank, FOS referral rights are engaged in two ways:

    • If a DISP eligible complainant is unhappy with the final response to its complaint received from the bank, the complainant has a period of 6 months from the date of the final response to refer its complaint to the FOS; or
    • If the bank fails to provide a DISP eligible complainant with a final response to its complaint within 8 weeks (56 days) of the raising the complaint, the complainant has the right to refer its complaint to FOS.

    F)  What is CPC?

    The Consumer Protection Code (CPC) and the SME Regulations sets out the requirements that regulated entities must comply with when handling complaints from consumers, including Micro, Small and Medium size enterprises (SMEs) in the Republic of Ireland. The code includes requirements on:

    • acknowledging and responding to complaints;
    • the time limits for dealing with complaints; and
    • record-keeping and reporting.
    • we will publish a separate document that clearly sets out our commitment to CPC and the SME Regulations.

    The Consumer Protection Code (2012) and the SME Regulations are available here.

    G) Referral to the FSO in Republic of Ireland

    Under the CPC and SME Regulations complainants also have the right to refer their complaints to the Financial Services Ombudsman (FSO) for consideration and adjudication.

     In summary, following the raising of a complaint to the bank, FSO referral rights are engaged in two ways:

    • If an eligible consumer complainant is unhappy with the final response to their complaint received from the bank, the complainant has a period of 6 years from the date of the occurrence of the event which they are complaining about to refer their complaint to the FSO; or
    • If the bank fails to provide an eligible consumer complainant with a final response to their complaint within 8 weeks (40 business days) of raising the complaint, the complainant has the right to refer their complaint to the FSO.

    Further information can be found here.

    H) Am I out of time to complain about an event in 2008?

    No. We will consider any complaint that relates to events between 2008 and 2013.  If, however, you later decide to bring court proceedings against the bank, the bank may at that stage be entitled to argue that your legal claim is out of time.  We would encourage you to seek independent legal advice if you are concerned about the time limits that may apply to any future court claim you may want to bring.

    I) How do I make an appeal?

    An appeal form will be sent to customers along with their outcome letter. It will also be made available on our website: www.rbs.com/GRG

    This form will allow you to specify which aspects of the bank’s decision you wish to appeal. You are encouraged to provide the reason for your appeal including what facts or matters are relied on in saying the bank's decision or offer is wrong. You may also wish to provide additional information or evidence. However if you provide new material information or evidence it is likely that the bank will be asked by the Independent Third Party to re-review the complaint in the first instance before the appeal is considered.

    We will publish further details on the appeals process in due course. 

  • Customer journey through the complaints process: If you make a complaint it will go through a number of process steps before an outcome is reached. This document sets out each of these steps in an easy to follow guide that will help you to understand the process and what the next steps will be following your involvement.

Customer journey through the complaints process [PDF 102KB]

  • Our commitment to DISP/CPC: We are committed to ensuring the fair treatment of all complainants and have designed our new complaints process to meet the best practice set out in the FCA’s Dispute Resolution (DISP) guidelines, and the regulations within the Consumer Protection Code (CPC) and SME Regulations for customers in the Republic of Ireland. We are committed to completing the complaints process as quickly as possible, but we must also ensure that the process is thorough and in some cases that may take longer as we will need to collate a significant amount of information in order to reach a decision. We will keep customers informed throughout to ensure they are aware of the likely timeframe for their complaint.

Our commitment to DISP [PDF 72KB]

Our commitment to CPC and SME Regulations [PDF 22 KB]

  • Complaints form: Please use this form to submit your complaint because it will help to ensure that you’ve included all the information required.  If we do need any further information, we will contact you.

Complaints form [PDF 141KB]

Frequently Asked Questions

  • Our announcement

    A) Why are you making this announcement now? 

    The steps announced today have been developed with the involvement of the FCA who agree these actions are appropriate steps for us to take. We are now in a position to announce a new complaints process overseen by Sir William Blackburne alongside an automatic refund of complex fees paid by SME customers who were in GRG between 2008-2013.

    B) What do I need to do?

    We have provided the answers to a wide range of frequently asked questions that will hopefully address any initial queries that you may have.

    There is nothing that you need to do to start the automatic fee refund process. In the next few weeks, we will start sending letters to customers to let them know if they are included in the automatic fee refund.

    If you have a complaint, please read the relevant section in these FAQs to understand whether or not you are in scope for the new complaints process. We have also explained how to make a complaint.

    If you have any further questions you can contact the GRG Customer Helpdesk by emailing

    GRGCustomerHelpdesk@rbs.co.uk  

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370
     

    C) What should I do if I need urgent support? 

    If your current circumstances dictate that you need to speak to us urgently then please contact us as soon as possible.

    In-scope customers should contact the GRG Customer Helpdesk by emailing GRGCustomerHelpdesk@rbs.co.uk  

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370

    If you are not in scope, you should contact your relationship manager or if it is in relation to an existing complaint then you should contact your complaint handler.

  • Customers affected by our announcement

    A) Which customers are affected by our announcement? 

    The steps being announced today are for small and medium-sized enterprise (SME) customers that were in GRG during the period 2008-2013.

    B) Does this announcement include GRG customers in the Republic of Ireland? 

    Ulster Bank in the Republic of Ireland is regulated by the Central Bank of Ireland (CBI). We will be providing the same support for SME customers of Ulster Bank in the Republic of Ireland that were in GRG during the period 2008-2013.

    SME customers of Ulster Bank in the Republic of Ireland can contact the GRG Customer Helpdesk if they have any queries using the same contact details below. We will start writing to affected customers in the Republic of Ireland during February 2017. If you have not received a letter by the end of February 2017 and wish to check with us whether or not you were in GRG during the relevant period, you can contact the GRG Customer Helpdesk by emailing GRGCustomerHelpdesk@rbs.co.uk

    You can contact the GRG Customer Helpdesk by emailing GRGCustomerHelpdesk@rbs.co.uk  

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370


    C) How do I find out if I, or my company, is in scope for the new complaints process? 

    If you are a UK customer and believe you should be in scope but didn’t receive a letter by 12th December 2016, please contact the GRG Customer Helpdesk by emailing GRGCustomerHelpdesk@rbs.co.uk   

    In the Republic of Ireland, work is underway to ensure we’re aligned to the RBS approach, however we need to take a little longer to get this right so that we can provide the same support for these customers. As a result, we will start writing to affected customers in the Republic of Ireland during February 2017. For more information please see the FAQ above specifically for Republic of Ireland customers.

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370

    D) How do I know if I am, or my company is, also in scope for the automatic refund of complex fees? 

    Please read the section of the FAQs that relates to the automatic refund of complex fees to understand whether or not you are in scope.

    E) How do you define an in-scope customer? 

    A customer is in scope if they meet all of the following criteria:

    • A small or medium-sized enterprise (SME) customer
    • managed in the UK or Republic of Ireland
    • under the control of GRG
    • during the period 2008-2013.

    F) Which customers are not considered to be in scope? 

    Customers are unlikely to be considered a small or medium-sized enterprise if they were or are:

    • an entity with listed securities
    • an entity with debt syndicated across a number of banks
    • registered offshore or the majority of its shareholders are offshore
    • private equity backed
    • a Special Purpose Vehicle (SPV), or
    • a sizeable business based on financial metrics (e.g. debt facilities and/or turnover higher than £20m). 

    G) Why are you only looking at the period 2008-2013?

    The period 2008-2013 is the relevant period under the FCA review.

    The period 2008-2013 was a very difficult time for the bank, our customers and the wider economy. There was an unprecedented increase in SMEs falling into financial distress and the number of customers managed by GRG increased by around 400%. As GRG adapted to the pressure of growing numbers, the bank accepts that during this period it did not always provide the level of service and understanding that it should have done. 

    H) What do I do if I’m not in scope? 

    If you would like to complain you should contact your relationship manager or if it is in relation to an existing complaint then you should contact your complaint handler.

  • New complaints process

    A) How do you define an in-scope customer for the new complaints process? 

    A customer is in-scope for the new complaints process with independent third-party oversight if they meet all of the following criteria:

    • A small or medium-sized enterprise (SME) customer
    • managed in the UK or Republic of Ireland
    • under the control of GRG
    • during the period 2008-2013. 

    B) Can I complain if my company is insolvent? 

    Yes, you can complain. However, we are only able to deal with the officials of the company presently appointed and listed at Companies House or Companies Registration Office in the Republic of Ireland. So you will also need to engage with the relevant person at the Administrator or Liquidator should you wish to complain.

    C) How do I make a complaint? 

    If you would like to raise a complaint in relation to GRG, please complete the complaints form which can be found on our website [PDF 96KB] and email a copy to the GRG Customer Helpdesk: GRGCustomerHelpdesk@rbs.co.uk  

    If you would prefer, you can also write to us using the postal address:

    GRG Customer Helpdesk, PO Box 71875, London. N1P 1WZ

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370

    D) Do I need to wait for the FCA review to be completed? 

    No, you do not need to wait for the FCA review to be completed.

    The steps we have announced have been developed with the involvement of the FCA who agree these actions are appropriate steps for us to take now. 

    E) Do I need to have a solicitor or third party to represent me? 

    No. The complaints process is very straight forward and we are here to answer any questions you may have, so we do not believe it is necessary for customers to involve solicitors in making a complaint. The new complaints process, including the Independent Third Party appeals process, will not make any determination on legal causes of action.

    If you would like a solicitor or third party to represent you, we will need a letter of authority from you to confirm the person or firm you want us to deal with on your behalf.

    F) Are there any reasons why you won’t review my complaints? 

    Yes. The review process is not appropriate for complaints that have previously been the subject of a decision by the Financial Ombudsman Service (FOS), Financial Services Ombudsman (FSO) in the Republic of Ireland or of the courts. It also may not be appropriate to consider complaints from customers in ongoing litigation against the bank or who have threatened litigation in formal Letters Before Claim unless the customer and RBS agree to stay those proceedings while the complaint is being considered.

    The review process will not make a determination on legal causes of action or in relation to allegations of criminal behaviour, fraud, dishonesty or other issues of conscious impropriety by RBS or its staff. Customers should refer any such allegations to the appropriate authorities.

    Further detail about the complaints process has been provided in the complaints process principles.

    G) What do I do if I’m not in scope? 

    If you would like to complain you should contact your relationship manager or if it is in relation to an existing complaint then you should contact your complaint handler.

    H) How will the new complaints process work? 

    We are creating a new complaints process for SME customers that were in GRG during the period 2008-2013. This will be delivered by a specialist team. An Independent Third Party, retired High Court Judge, Sir William Blackburne, will perform an assurance and appeal role as part of the process. This adds a more robust and independent step to the complaints process to deliver fair outcomes should SME customers who were in GRG wish to complain about their treatment.

    The bank will assess a customer’s complaint in the first instance and then advise the customer in writing whether the complaint has been upheld and, if so, whether the bank proposes to pay any compensation for direct losses incurred by the customer.

    The customer will have the option to appeal this decision to the Independent Third Party within 28 days of the date of the decision letter. A customer can appeal against any aspect of the decision reached by the bank’s complaints process. This includes appealing against complaints that have been upheld by the bank but where the customer is unhappy with the outcome or the offer made by the bank.

    If the customer appeals the bank’s decision, the Independent Third Party will reach their own conclusion on whether the complaint should be upheld or not and on what basis. The Independent Third Party will record their decision, including any award for direct loss only, and a brief summary of their reasons will be provided to RBS and the customer.

    Subject to the customer accepting the Independent Third Party’s decision, the decision of the Independent Third Party will be binding on the bank.

    Further detail about the complaints process has been provided in the customer journey through the complaints process on the website.

    If you have any questions about this process please contact the GRG Customer Helpdesk by emailing GRGCustomerHelpdesk@rbs.co.uk

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370

    I) How long will the complaints process take?

    We are committed to completing the complaints process as quickly as possible, but we must also ensure that the process is thorough. In some cases it may take some time as we will need to collate and review a significant amount of information in order to reach a decision. We will keep customers informed throughout to ensure they are aware of the status of their complaint. Please note that, as the Independent Third Party is assuring the complaints process, complaint outcomes cannot be delivered until we have received confirmation that he is happy for the bank to commence responding to customers.

    J) What do you mean by direct losses?

    For the purpose of the new complaints process, ‘direct loss’ means sums of money paid by a customer to RBS or a customer’s out of pocket costs of meeting RBS’s requirements that were a direct result of an upheld complaint. Examples include:

    • arrangement fees
    • renewal fees
    • excess fees
    • increased interest payments made to RBS by a customer
    • costs and expenditure incurred by a customer in connection with an independent business review, a valuation report, a security review, or other actions required by RBS, or
    • Costs and expenditure incurred by a customer for the appointment of a third party to the customer at the request of RBS.


    Further clarification on direct losses in the principles governing the review of complaints relating to RBS’s Global Restructuring Group is available in the complaints process principles on this website.

    K) Will you consider claims for consequential loss? 

    In the event that a complaint is upheld through the complaints process, and the customer accepts the decision, the bank will consider any claim for consequential loss that the customer wishes to pursue, based on the findings. In considering any claim for consequential loss, the bank will apply established legal principles to determine whether the loss is factually and legally attributable to it.

    The process for consideration of claims for consequential loss will not be overseen by the Independent Third Party and there will be no right of appeal to the Independent Third Party in respect of consequential loss claims.

    Further detail about the complaints process has been provided in the complaints process principles on the website.

    L) What is the role of the Independent Third Party? 

    The Independent Third Party will play a dual role:

    (1) provide assurance that the process and methodology for the complaints review are appropriate and provide a framework that enables a thorough and robust assessment of complaints both at the outset and on an ongoing basis;

    (2) operate the Independent Third Party appeals process. This will include:

    • where a customer appeals a decision made in the bank’s complaints review, assessing RBS’s actions that are the subject of the complaint having regard to certain standards
    • where the Independent Third Party decides it is appropriate, assessing and awarding compensation for direct loss, and
    • preparing a record of their decision in a short summary document and providing this to RBS and the customer. 

    M) Do all customers that complain have access to the Independent Third Party appeal process? 

    All in-scope customers will have the right of appeal to the Independent Third Party.

    Customers that are not in scope will not be able to appeal to the Independent Third Party. 

    N) Can I speak to the Independent Third Party directly? 

    No, that is not thought to be necessary. The Independent Third Party’s role is to provide assurance and oversight of the complaints process and operate the Independent Third Party appeals process.

    However, in exceptional cases where the Independent Third Party believes it is appropriate to do so, the Independent Third Party will have the option to ask a customer to provide evidence or arguments in person. There will be no obligation on the customer to provide evidence in person and deciding not to do so will not affect the Independent Third Party’s duty to deliver a fair outcome for the customer.

  • Automatic refund of complex fees

    A) How do you define an in-scope customer for the automatic fee refund? 

    A customer is in-scope for the automatic fee refund if you paid any of the fees being automatically refunded and meet all of the following criteria:

    • A small or medium-sized enterprise (SME) customer
    • managed in the UK or Republic of Ireland
    • under the control of GRG
    • during the period 2008-2013.

    B) Why are you reviewing the complex fees paid by SME customers in GRG? 

    GRG used a variety of different fees or pricing tools to reflect the increased cost of risk associated with customers in financial difficulty, and sometimes charged fees that our SME customers were not familiar with, either because they were not commonly used, or because they were a bespoke pricing instrument.

    For SME customers in GRG during the crisis, some of the complex fees charged were not properly communicated or were not explained clearly enough so we have decided to automatically refund them. This will save customers from further delay, ensure that we can start refunding fees more quickly and demonstrate our commitment to addressing issues of the past. 

    C) How will the automatic refund of complex fees work? 

    There is nothing that you need to do. There are a number of steps in the process and we will be doing all of them proactively:

    • We will start sending letters to customers in the next few weeks to inform them that the fees they paid will be included in the fee review.
    • We will then review the fees paid by customers in GRG to determine whether or not they are one of the fees that we have agreed to refund (see list below).
    • Once we have completed the fee review, we will then write to customers to confirm any fee refunds that will be paid.
    • Refunds will be made automatically to the accounts of RBS customers. We will discuss with former customers the simplest way to pay any refund due.
    • We will pay interest on the refunded fees at 8% simple per annum from the date each complex fee was paid to a date which is 28 days following the date of the outcome letter

    D) When is this process going to start? 

    There is nothing that you need to do to start the automatic refund of complex fees. In the next few weeks, we will start sending letters to customers to let them know if they are included in this process.

    The GRG Customer Helpdesk is available to support customers from today. If you have any questions that have not been addressed in these FAQs, you can contact the GRG Customer Helpdesk by emailing GRGCustomerHelpdesk@rbs.co.uk

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370

    E) When will this process be completed? 

    We will be working as quickly as possible to substantially complete the automatic fee refund. Our aim is to complete this part of the process during 2017.

    For customer complaints, the time required will vary for each customer depending on the nature and complexity of the complaint. We will ensure that customers are kept updated regularly and provide reasonable estimates of the time required in each case. 

    F) What fees are being refunded? 

    During the period 2008-2013, a number of different names or terms may have been used to describe the fees charged. But the list below outlines the fee types charged to SME customers in GRG between 2008-2013 that are included in the automatic fee refund:

    • Management / Monitoring Fees: Fees charged to cover the increased costs incurred in relation to managing customers in restructuring situations. Usually this is a fixed amount per month / quarter.
    • Asset Sales Fee: Fee charged on the sale of an asset to reflect the bank’s increased risk profile such as in circumstances where the customer’s cash flow could not meet the increased margin required by the bank on an ongoing basis.
    • Exit Fee: Fee charged at the point of repayment to reflect the bank’s increased risk profile such as in circumstances where the customer’s cash flow could not meet the increased margin required by the bank on an ongoing basis.
    • Mezzanine Fee: Fee charged to reflect mezzanine risk (i.e. the debt level above the bank’s standard senior debt appetite), usually expressed as a percentage of the mezzanine debt level.
    • Ratchet Fee: Variable fee charged by the bank in relation to a repayment milestone.
    • Risk Fee: Fee charged to reflect an increased risk profile in continuing to support a customer for a period of time following an event of default or failure to agree a formal renewal of expired contractual facilities.
    • Late Management Information (MI) Fee: Fee charged for the late submission of management / financial information by the customer. 

    G) Are Property Participation Fee Agreements (PPFAs) and Equity Participation Agreements (EPAs) included in this review? 

    Yes. The fees paid under PPFAs will be refunded. If the PPFA has not yet matured we will contact the customer to discuss releasing them from their obligations under the agreement.

    We will also contact customers to discuss EPAs.

    H) Will all of my fees be refunded? 

    We are refunding the complex fees that were paid by SME customers in GRG during the period 2008-2013. Before making any payments in this regard, we will assess each customer’s circumstances on a case-by-case basis and exercise our legal and/or contractual rights of set off where it is appropriate to do so. For example, where we have made demand for repayment the refund will be credited to the current/loan account to reduce amounts outstanding.

    Where there is no default the customer will receive the full benefit of the refund.

    I) You have offset my complex fees refund against outstanding debt and I don’t agree with this. What can I do?

    Please note that whilst we acknowledge that, generally, we could have better explained complex fees to customers, we have not conducted a review of the specific circumstances of each fee charged. We are therefore making the automatic fee refund on a voluntary basis and have taken the decision that, where there are outstanding debts owed to the bank, any complex fee refunds will reduce amounts outstanding. Any surplus will be paid in the normal way. However, if you wish to complain about the basis upon which any specific fee was charged or the basis upon which offset has been applied to it, you may do so.

    J) What fees are not being refunded? 

    • Facility Fees: These include Arrangement Fees, Facility Fees and Renewal Fees which are payable to the bank for arranging / amending / renewing new or existing facilities. These fees are usually paid upfront. However depending on a customer’s cash flow these fees may be paid on a deferred basis, over an extended period of time or on refinance or exit or from surplus asset sales proceeds.
    • Excess Fee: Fee payable when the balance on a customer’s account is either: (a) overdrawn, with no formal facility in place; or (b) in excess of any agreed overdraft facility limits.
    • Commitment Fee: Fee payable that relates to the provision of a committed facility.
    • Covenant Waiver / Breach Fee: Fee payable when a documented facility covenant has been breached.
    • Security Fee: Fee charged by the bank or re-charged via a third party to a customer to cover the cost of carrying out a legal review of security and / or facility documentation held. 

    K) Will you be refunding the additional cost of margin increases? 

    Margins are part of standard banking practice and are not complex. Therefore, margins are not in scope for the automatic refund of complex fees. 

    L) Can I receive an automatic refund if my company is dissolved? 

    Where a refund is due, you will need to reform the dissolved entity in order to receive the refund.

    M) What do I do if I’m not satisfied with the automatic fee refund process? 

    If you’re not satisfied with the automatic fee refund process you are able to complain under the new complaints process.

    If you would like to raise a complaint in relation to the automatic fee refund, please contact the GRG Customer Helpdesk by emailing GRGCustomerHelpdesk@rbs.co.uk

    A complaints form can be found on our website: [PDF 141KB]

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370

  • Contact details

    A) Who can I speak to about this? 

    The new complaints process is for SME customers managed in the UK or Republic of Ireland in GRG during the period 2008-2013.

    If you would like to contact us about any of the issues raised in our announcement you can contact the GRG Customer Helpdesk by email or phone.

    Email: GRGCustomerHelpdesk@rbs.co.uk

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370

    If you would prefer, you can also write to us using the postal address:

    GRG Customer Helpdesk, PO Box 71875, London. N1P 1WZ 

    B) Is there a complaints form I can complete? 

    Yes. The complaints form can be found on our website [PDF 96KB]

    C) What are the opening hours for the GRG Customer Helpdesk? 

    The opening hours for the GRG Customer Helpdesk are Monday to Friday 9am – 5pm.

    You can send an email at any time to GRGCustomerHelpdesk@rbs.co.uk and we will aim to reply within 48 hours. 

    D) Can I speak to my relationship manager about this? 

    There is no need for you to speak to your relationship manager. We will be proactively contacting customers to let them know if they are in scope.

    This is designed to be an independent process and our relationship managers have been told to direct any queries related to this announcement to the GRG Customer Helpdesk.

    Email: GRGCustomerHelpdesk@rbs.co.uk

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370

    E) What is the email address for queries and complaints? 

    Email: GRGCustomerHelpdesk@rbs.co.uk

    F) What is the phone number? 

    Alternatively you can call the helpdesk using one of the following numbers:

    Telephone (UK): 0800 0294 370
    Telephone (ROI): 1800 882 779
    International: +44 184 222 6142
    Text Relay (UK): 18001 0800 0294 370

    G) Can I speak to the Independent Third Party directly? 

    No, that is not thought to be necessary. The Independent Third Party’s role is to provide assurance and oversight of the complaints process and operate the Independent Third Party appeals process.

    However, in exceptional cases where the Independent Third Party believes it is appropriate to do so, the Independent Third Party will have the option to ask a customer to provide evidence or arguments in person. There will be no obligation on the customer to provide evidence in person and deciding not to do so will not affect the Independent Third Party’s duty to deliver a fair outcome for the customer.

  • FCA update and ongoing review

    A) What is the review the FCA is working on? 

    The FCA review of the historical treatment of SME customers in GRG remains ongoing.

    We are continuing to cooperate fully with the regulator and remain keen to understand any conclusions they will draw from the review and learn the lessons from that. It would not be appropriate to comment further until the FCA has finished its review and published conclusions.

    More information can be found on the FCA website:

    https://www.fca.org.uk/news/press-releases/review-royal-bank-scotland-treatment-customers-referred-global-restructuring-group

    B) Who are Promontory Financial Group and what is their role? 

    The FCA appointed Promontory Financial Group in 2014 to review RBS’s treatment of SME customers transferred to GRG between 2008 and 2013. The role is referred to as the skilled person and their final report was provided to the FCA in September 2016. 

    C) Do you agree with the all of Promontory’s findings published by the FCA today? 

    We accept many of Promontory’s findings but there are a number of aspects where we have a different view. Irrespective of this, the complaints review process will enable customers to raise any issues they have in respect of their treatment in GRG during the period 2008-2013. Moreover, we believe changes we have already made address the vast majority of the concerns raised by Promontory.

    D) What is your response to the findings in relation to the widespread inappropriate treatment of customers? 

    We accept many of Promontory's findings but there are a number of aspects where we have a different view. We have given a comprehensive response to the FCA in relation to the Promontory report and it would not be appropriate to comment further whilst the FCA review is ongoing. Irrespective of this, the new complaints process will enable customers to raise any issues they have in respect of their treatment in GRG during the period between 2008-2013. 

    E) Does the FCA agree these steps answer fully the failings identified? 

    These actions have been developed with the involvement of the FCA who agree they are appropriate steps for the bank to take. 

    F) Why haven’t the FCA announced the conclusions of their review? 

    The FCA shared details of next steps in their update:

    “The FCA is carefully considering the Report and other additional material. The activities carried out by GRG and addressed by RBS’s proposals are largely unregulated; therefore, the FCA’s powers are limited in this area.

    The FCA is currently assessing what further work may be needed given the findings in the Report. The FCA will provide a further update on this matter when it is in a position to do so.

    The FCA recognises the considerable interest in these issues and will publish a full account of its findings when practicable once our work is concluded.”

    The FCA update is available in full on their website:

    https://www.fca.org.uk/news/press-releases/review-royal-bank-scotland-treatment-customers-referred-global-restructuring-group

    G) Do I need to wait for the FCA review to be completed? 

    No. These actions have been developed with the involvement of the FCA who agree they are appropriate steps for the bank to take.

Restructuring explained

Original announcement

  • Announcement published 8 November

    RBS is also responding to the FCA’s update on its review into the treatment of SME customers in the bank’s former Global Restructuring Group (GRG) between 2008 - 2013 and its summary of the Promontory Financial Group report.

    As the bank has acknowledged, in some areas, it could have done better for SME customers in GRG. Specifically, the bank could have managed the transition to GRG better and should have better explained to customers any changes to the prices or complex fees it was charging. The bank accepts that it did not always communicate as well or as clearly as it should have done. The bank also did not always handle customer complaints well.

    RBS notes that the FCA’s update confirms that no evidence was found that the bank artificially engineered a position to cause or facilitate the transfer of a customer to GRG or identified customers for transfer for inappropriate reasons and that all SME customers transferred to GRG were exhibiting clear signs of financial difficulty. The update makes clear that there were no cases where the purchase of a property by West Register alone gave rise to a financial loss to the customer and that there was no evidence of intent for West Register to purchase assets being formed prior to the transfer to GRG. It also states that, in a significant majority of cases, it was likely that RBS’s actions did not result in material financial distress to these customers.

    As a result of the historical issues identified, RBS is taking two important steps for those SMEs in the UK and ROI that were customers in GRG during the period between 2008 - 2013. This activity is designed to address the bank’s failings.

    A New Complaints Process for those customers in scope, overseen by retired High Court Judge, Sir William Blackburne. Sir William’s appointment as Independent Third Party adds a robust, transparent and independent step to the complaints process, should SME customers who were in GRG wish to complain about their treatment or challenge the bank’s decision on a previous complaint.

    An Automatic Refund of Complex Fees paid by SMEs in the UK and ROI that were customers in GRG during the relevant period. This will save customers from further delay, ensure that the bank can start refunding fees more quickly and demonstrate our commitment to addressing issues of the past.

    These proposals have been developed with the involvement of the FCA which agrees that these are appropriate steps for the bank to take. RBS will provide further details of the new complaints process on its website.

    The bank estimates the costs associated with the new complaints review process and the automatic refund of complex fees to be approximately £400m, to be provided in Q4 2016. This includes the operational costs of both the fee refund and the new complaints process, together with the refund of complex fees and additional estimated redress costs arising from the new complaints process.

    It is important to remember that the period in question, between 2008 - 2013, was a very challenging time for the bank and its customers. In 2008, there was an unprecedented increase in SMEs falling into financial distress and the number moving into GRG increased by around 400%. RBS lost more than £2bn from lending to SME customers.  

    RBS continues to cooperate fully with the FCA and remains keen to understand, and learn lessons from, any conclusions that the FCA draws in its review.  It would not be appropriate to comment further on that review until those conclusions have been published.

    -

    Ross McEwan, CEO of RBS said:

    “We have acknowledged for some time that mistakes were made. Some of our customers went through what was a traumatic and painful experience as a result of the crisis. I am very sorry that we did not provide the level of service and understanding we should have done.

    “Although the FCA review into the historical operation of GRG continues, we believe that now is the right time to deal with the areas where we accept some customers were let down in the past.  I am pleased that with the agreement of the FCA, we are able to announce a new complaints process overseen by Sir William Blackburne, alongside an automatic refund of complex fees paid by SME customers who were in GRG between 2008 - 2013.

    “The culture, structure and way RBS operates today is fundamentally different from the period under review. We have made significant changes to deal with the issues of the past, so that the bank can better support SME customers in financial difficulty whilst also protecting the bank’s capital.”

    -

    CEO Ross McEwan on today's announcement: