RBS failure faces new probe

Britain's banking regulator is to launch a new probe into the failure of the Royal Bank of Scotland in light of revelations about Sir Fred Goodwin's private life.

The Financial Services Authority is examine the circumstances that led to the Government bail-out of the bank in light of an alleged affair between Sir Fred and a senior colleague.

RBS is now 83% owned by the taxpayer after the bank failed at the height of the financial crisis in 2008.

The demise of the bank was largely blamed on its takeover of Dutch bank ABN Amro just as the credit crunch tore through world markets.

The bank was part-nationalised with the loss of 20,000 jobs and at a cost of some £50 billion to the taxpayer.

Details of the alleged affair were revealed with the partial lifting of a privacy injunction granted to Sir Fred on Thursday.

An FSA spokesman said: "We can confirm we have contacted RBS in relation to this matter, but we can't comment further".

An RBS spokeswoman said the bank was "co-operating fully with the Financial Services Authority".