Shares fall on announcement of FSA probe into the bank's purchase of ABN Amro
Accountancy Age, 18 Aug 2009
The Financial Services Authority is investigating the details over the Royal Bank of Scotland's acquisition of ABN Amro for €14.3bn (£12.43bn) which was largely blamed for the banks downfall.
RBS made the announcement of the investigation, which is to have a particular focus on how the bank raised the capital, in its interim results released this month, the Financial Times reported.
A footnote read: 'In April 2009 the FSA notified the group that it was commencing a supervisory review of the acquisition of ABN Amro in 2007 and the 2008 capital raisings.'
'The group and its subsidiaries are cooperating fully with this review' it added.
The ABN acquisition was largely blamed for both the £12bn rights issue needed by RBS and its subsequent bailout by the government.
The government pumped £20bn into the Edinburgh-based bank and now owns 70% of it.
The acquisition was undertaken by former chief executive Fred Goodwin, who was ousted last year.
On the back of the FSA investigation announcement yesterday, shares in RBS fell by 1.26p.
The shares are currently trading at 90% less than their peak in 2007, around 550p, and were on sale for 44.89p by 12:30pm yesterday.
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