Upper Tribunal Tax and Chancery Chamber

[2025] UKUT 00185 (TCC)

Fecha: 09-Abr-2025

Key findings already made

Key findings already made

355.

In September 2018 (see §146(3)), the executive leadership team had been advised that there were “inconsistencies in current RWA calculations that will result (our emphasis) in a significant increase in risk weightings”, because commercial mortgages had been weighted at 50% rather than 100%, and that KPMG had confirmed that this was correct.

356.

The RWA Report considered in October 2018 by the CRPAC and the ROC stated that (see §§174-185):

(1)

CLIP loans had been wrongly risk-weighted in the past;

(2)

when correctly risk-weighted, the related RWA increased by £574m;

(3)

further adjustments to the figures were not expected to be material.

357.

No-one at the CRPAC meeting (including Mr Donaldson and Mr Arden) dissented from the position set out in the RWA Report, see §185).

358.

Ms Gillan told the Board that around £600m was the current estimate for the RWA adjustment; that figure was based on the analysis in the RWA Report, see §232.

359.

At the time of the Q3 Update (see §237 and §208):

(1)

the Bank’s commercial loans were £4,166m out of total net loans of £13,121m;

(2)

the CLIP loans were £1,148m, and so constituted over 27% of the Bank’s commercial loan portfolio;

(3)

the estimated RWA adjustment for CLIP loans was £574m.

360.

The RWA adjustment figure for the CLIP loans reported to the PRA in January 2019 following Deloitte’s review was £563m, see §249.