Global credit crisis hits RBS

30 August 2007

The Royal Bank of Scotland is the latest bank to be affected by the global credit situation after a senior executive left the bank.

According to City AM, Rick Caplan, left his position of head of collateralised debt obligations (CDO) at RBS Greenwich Capital two weeks ago, and this was confirmed by the bank after rumours were leaked.

Six more jobs in the department were also axed, and these are thought to be permanent with the department's size being cut from 24 down to 17 after the bank announced that revenues for the first half of 2007 had fallen by 23 per cent.

Speaking to the newspaper, the bank said: "The business is sized appropriately to meet the demand we forecast going forward."

The collapse of the sub-prime market in the US has led to a fall in demand for CDOs.

"Rick's departure reflects the adjustments we are making in our CDO business to bring it in line with the realities of market volumes." the bank told the newspaper.

The news follows the departure of Ed Cahill, former head of the Barclays Capital CDO business, last week.

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