RBS admits ABN Amro “bad mistake”

At today’s Treasury Select Committee, former RBS chairman Sir Tom McKillop and former chief executive Sir Fred Goodwin admitted that the acquisition of ABN Amro helped towards the bank’s near demise.

Jim Cousins said: “How much did you overpay for ABN Amro?”

McKillop replied: “In retrospect we bought ABN at the top of the market, so everything we paid was not worth it. I could say 50 per cent but what difference would it make? We are sorry we bought ABN Amro.”

Both McKillop and Goodwin could not put a figure on how much RBS will have to write down to cover loses made thanks to the acquisition.

McKillop says: “A significant part of the goodwill write-off, £15bn, is ABN Amro, but I couldn’t tell you how much we lost on ABN. I would basically submit that the bulk of what we paid for ABN Amro, which was £10bn, will be written off.”

The former chairman denied that the decision to buy the bank was Goodwin’s, he said the board had 18 meetings and were unanimously agreed to go ahead with the buy up.

Cousins said: “Mr McKillop, how would summarise the deal? I am asking you, you were in charge of this board, you have destroyed a great British bank and you have cost the taxpayer £20bn.”

“It was a bad mistake, at the time it didn’t look like that,” replied McKillop.