[2025] UKUT 00185 (TCC)

The first substantive item on the agenda for the October Board meeting was a governance update from Linklaters, but neither RWAs nor Mr Lane’s advice formed part of the discussion, see §215. The second item was Mr Bernau’s summary of the Audit Committee meeting which had taken place that morning: Mr Bernau said that the Committee recommended the Q3 Update to the Board. However, as already noted above, the Audit Committee:

The Q3 Update was approved by the Board without reference to the RWA issue, see §219.

The next relevant item was the 2019 Budget Paper. This listed four items which eroded the capital buffer, one of which was “a review of Commercial lending risk weighted assets”. However, the discussion at the meeting did not expand on that statement; the Board was not provided with the quantum of the error, and no reference was made to Linklaters’s advice, see §228.

That was followed by the Chief Risk Officer’s Report which had also been provided to the ROC. As noted above, it said (our emphasis) that “this metric could increase by around 10 per cent (circa 40 million of capital) upon completion of the asset classification project”. In the meeting, the Board were told that “management are presently remediating the classification of commercial risk weights in the lending portfolio”, with Deloitte providing “a review of RWA calculations”; they were also told by Ms Gillan that the “current estimate” for the RWAs for commercial mortgages was around £600m, see §232.