The Royal Bank of Scotland's flagship main office is in Edinburgh, but RBS may move registered offices to England if Scots vote for independence next week
London (AFP) - Britain's bailed-out Royal Bank of Scotland has been fined £14 million for not taking enough care to explain to home-buyers the costs of taking out a mortgage, regulators said on Wednesday.
The fine, equivalent to 18 million euros ($23 million), was imposed because the bank had shown "serious failings" in its advice to home loan customers, the regulators said.
"The Financial Conduct Authority (FCA) has today fined The Royal Bank of Scotland and NatWest £14,474,600 for serious failings in their advised mortgage sales business," the FCA said in a statement.
The watchdog added that, following a review, it found that only two of 164 mortgage sales it examined between June 2011 and March 2013 had met the overall standard required.
The FCA said RBS and its retail division NatWest had failed to consider the full extent of a customer's budget when making a mortgage recommendation.
Staff also failed to advise customers what length of mortgage was the most appropriate for them.
The Financial Services Authority -- which was subsequently replaced by the FCA -- had raised concerns in November 2011 about branch and telephone sales but it was almost one year before any action was taken.
"Where we raise concerns with firms we expect them to take effective action to resolve them without delay," said Tracey McDermott, director of enforcement and financial crime at the FCA.
"This simply failed to happen in this case," McDermott added.
RBS said in a separate statement that it had overhauled its mortgage sales process and re-trained all advisors at the end of 2012, in response to the regulator's findings.
The group added it was writing to customers who received mortgage advice during the period, to invite them to raise concerns about the advice received.
RBS chief executive Ross McEwan said that the failings over advice were "unacceptable and should never have happened".
Edinburgh-based Royal Bank of Scotland remains 81-percent state-owned after it was rescued with £45.5 billion of taxpayers' cash during the 2008 global financial crisis, making it the world's biggest-ever banking bailout.