Q145 Jesse Norman: I apologise for being slightly late into the session. Mr O’Neil, just a factual question. When did you leave Bank of America?
Jim O'Neil: I left in July, August 2010 and joined UKFI in October 2010.
Jesse Norman: July, August 2010?
Jim O'Neil: Yes.
Q146 Jesse Norman: When you were at Merrill Lynch, were you involved in either the RBS bid for ABN or the Lloyds bid for HBOS?
Jim O'Neil: I was on the team at Merrill Lynch that advised the consortium of RBS, Santander and Fortis, or worked with. I am not an M&A adviser; I am a financing specialist, and my work was with Fortis.
Jesse Norman: You were part of the RBS group acquisition team?
Jim O'Neil: Merrill Lynch advised the consortium, and I had a role in financing. We had different roles, and my role was with Fortis.
Jesse Norman: But you were not part of the Merrill group that advised Lloyds in relation to HBOS?
Jim O'Neil: No.
Q147 Jesse Norman: How much was Merrill paid for its advice to that group?
Jim O'Neil: I think it is a question for Merrill Lynch. I actually don’t know. I can’t recall. It was five years ago. The financing fees are public, so we could look them up.
Jesse Norman: Oh, they are? Okay.
Jim O'Neil: I think they would be in—for the work I did on Fortis with the rights issue, there is a prospectus with the fees covered in the prospectus.
Q148 Jesse Norman: Absolutely. Of course, it might not be the case that the total fees were disclosed. Often, the advisory fees do not get disclosed.
Jim O'Neil: I just cannot recall and, again, I was a financing specialist on that transaction.
Q149 Jesse Norman: Sure. Would you have expected them to be north of a couple of hundred million pounds? That was the level at which I think we had that estimated by the two independent assessors of RBS.
Jim O'Neil: It is five years ago, so I do not actually remember, but I think if you added all of the transactions done with those clients over a period of time, not necessarily just that, I am sure it would be a very big number.
Q150 Jesse Norman: Thank you very much. Final question—and I suppose it is to any of you, which is do you think there is a risk to RBS and, therefore, to the taxpayer—and, if so, how much—from the rapidly building civil lawsuits that we are seeing in respect of RBS? The scale of the cost is £3 billion to £5 billion, as it appears at the moment.
Jim O'Neil: It is very difficult. There are a lot of contingent liabilities for RBS, not just lawsuits but elsewhere as well, and there is a whole host at the bank. It is very difficult to assess what the payouts might be, so it is hard.
Q151 Jesse Norman: It could be huge?
Jim O'Neil: Well, if the suit was successful and they lost £5 billion that would be a big hole, but there is no way for us to assess whether it gets zero, or whether it is a large number.
Q152 Jesse Norman: Right, but you are monitoring it; you have legal people keeping an eye on the potential scale of the loss?
Jim O'Neil: As a commercial shareholder, we engage with management on issues but we do not have any separate legal advice on those issues.
Q9 Jesse Norman: You do not think the Chancellor might need separate advice in respect of—
Jim O'Neil: That would be up to the Chancellor. Certainly, for us as shareholder, we are not seeking separate legal advice.