[2025] UKUT 00185 (TCC)

The Chief Risk Officer’s Report was the same as had previously been considered at the ROC meeting that morning. It thus contained the same brief reference on the summary page to the fact that “standardised RWAs continue to be above threshold”, and the same paragraph set out at §204 which conflates the reclassification of CRE assets with the CLIP loan issue, and says that “this metric could increase by around 10 per cent (circa 40 million of capital) upon completion of the asset classification project”, but without more explanation.

Ms Gillan joined the meeting to present this paper. In reliance on the minutes we find that she informed the Board that:

“On Credit Risk, the Bank remains within appetite overall, though standardised RWA’s continue to be above threshold. Management are presently remediating the classification of commercial risk weights in the lending portfolio. Deloitte have been engaged to provide external assurance over current processes and provide a review of RWA calculations. Further updates will be provided to Board in due course, with detailed findings being taken through ROC.”

Mr Arden’s contemporaneous hand-written notes say:

“RWAs: standardised RWAs above threshold. Shared with ROC. RWAs up by c £600m.”

On the basis of Mr Arden’s oral evidence and that given by Ms Gillan, we find that the c£600m was a reference to the adjustment for commercial mortgages (including CLIP loans) set out in the RWA Report, and we also find that the Board was told by Ms Gillan that about £600m was “the current estimate”.

Mr Arden agreed in cross-examination that there was no reference in the minutes to the Board being told that the underlying data was unreliable, or that the assistance of Deloitte was needed to correct major problems with the data, and we find as a fact that the Board was not so told at this meeting.