Controversy surrounding the U.K. government’s awarding of Royal Bank of Scotland funds to challenger banks continues, with critics now claiming the award to Starling Bank last month involves a conflict of interest.
Reports in The Times on Friday (March 8) said Aidene Walsh, a member of the Banking Competition Remedies, which is responsible for choosing RBS fund recipients, reportedly worked previously with Starling Bank CEO Anne Boden. The two worked together at ABN Amro and, later, at Royal Bank of Scotland following RBS’s acquisition of ABN Amro, reports said.
One unnamed source told the publication that Walsh and Boden have a “close” relationship, with Walsh acting as Boden’s “trusted lieutenant.”
This isn’t the first time that concerns over a conflict of interest have hit this particular case. Reports noted that Starling Bank wrote to BCR committee chairman Lord Cromwell warning of “a potential conflict of interest” as Starling pursued RBS funds. The bank reported requested that the committee provide “an explanation as to how this situation will be dealt with.”
At the time, the BCR reportedly advised that the bid evaluation and selection processes “address robustly the issues that you raise.”
In a statement following the latest accusations, Lord Cromwell noted that Walsh’s “wide banking experience is an asset to BCR.”
“The board is aware of past contact with Anne Boden of Starling and acted appropriately in recording and managing this,” he continued. “Aidene was one member of the five-person board that collectively made the decision of which bids to support.”
The first winners of RBS funds were announced last month, with Starling securing more than $130 million. Other winners included ClearBank, which had partnered with Tide Bank, as well as Metro.
The largest award went to Metro, which secured nearly $156.8 million, raising more concerns among critics that noted Metro had revealed accounting errors earlier this year.