Royal Bank of Scotland Accused of 'distressing' Small Firms

Royal Bank of Scotland faced more damage to its reputation on Monday after the government handed regulators a report claiming that the state-rescued lender forced small firms to default.

Compiled over the past six months, it focuses on claims against the bank's Global Restructuring Group (GRG), which deals with risky loans.

The report alleges that the bank hit seemingly healthy businesses with unmanageable charges and rates before it seized their assets at a knock-down price.

Reacting to the report's findings, Royal Bank of Scotland insisted that “GRG successfully turns around most of the businesses it works with” but said that “not all businesses that encounter serious financial trouble can be saved.”

It added in a statement: “We are already committed to an inquiry to investigate how...