cost Royal Bank of Scotland (RBS) up to £500 million (€534
million), according to newspaper reports.
reported £2.4 billion of outstanding debt in its latest figures –
still hopes that it can recover the £500 million, according to the
Daily Telegraph.
But in reality it seems highly unlikely that Cattles will be
able to meet all of its debt obligations.
“RBS isn’t the only bank to have been caught up in the Cattles
debacle,” said an analyst. “But it is the biggest and, since this
looks like it will be yet another problem the bank will have to
pass on to the taxpayer, it’s another big dent in its reputation
and its public image.”
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Headed by RBS, Cattles’ 22-bank consortium of lenders also
includes HSBC, Barclays and Lloyds Banking Group.
Last month, Cattles’ sub-prime hire purchase subsidiary, Welcome
Financial Services, announced it would stop lending to new
customers.
Following a forensic accounting review by Deloitte, the
accounting consultancy, and Freshfields Bruckhaus Deringer, the law
firm, Welcome was found to have under-reported bad debts.
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