PwC's RBS report cost £7.7m
PwC charges £7.7m after it was called in by the FSA to look into the events leading up to RBS' bailout
PWC’s ANALYSIS of what went wrong at Royal Bank of Scotland cost £7.7m.
The FSA, which is largely funded by City firms and commissioned the report, did not pay the fees in their entirety because the regulator imposed a “special levy” on RBS of more than £4.7m for the extra regulation that the bailed out bank required after receiving a £45bn capital injection from the taxpayer, the Guardian reported.
PwC was commissioned by the FSA to look at a number of operations at RBS, including the events that led to the takeover of the Dutch bank ABN Amro as the credit crunch was beginning in late 2007. The deal left the enlarged bank with wafer-thin capital ratios.
PwC also looked at rights issues conducted by the bank in 2008 that were required to bolster its capital as a result of the Dutch takeover. PwC also scrutinised the “conduct, systems and controls” of the investment bank at RBS and the regulator defended the cost of the work conducted by PwC on the basis that a “complex” set of investigations were essential, the Guardian said.
A Freedom of Information act request to the FSA into the fee paid to PwC for its work led to the regulator disclosing that “the fee so far paid to PwC for its work on the review into RBS was £7,643,386 (including VAT)”.
“We expect to receive a final invoice for approximately £55,000 (excluding VAT) in January 2011,” the FSA told the newspaper.
The FSA report published last month found that the RBS executives were foolish but not fraudulent in the run up to the bank’s near-collapse.
