FSA censures Bank of Scotland for serious misconduct

The Financial Services Authority (FSA) has censured Bank of Scotland for failings within its Corporate Division between January 2006 and December 2008.

According to the regulator, the HBOS subsidiary was "guilty of very serious misconduct, which contributed to the circumstances that led to the UK government having to inject taxpayer funding into HBOS". Between January 2006 and March 2008, the bank's corporate division pursued an aggressive growth strategy that focused on high risk, sub-investment grade lending, with transactions gradually increasing in size, complexity and risk. Its portfolio was high risk with highly concentrated exposures to property and to significant large borrowers and, according to the FSA, the strategy was "hi...