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The next step is they would be giving us their entire trading book".
A regime which inadequately evaluated trading book risks was, therefore, fundamental to RBS's failure.
Once in the trading book, the loans are marked to market daily.
Credit-risk departments thought of them as market risk, because they sat in the trading book.
The banks must also turn over in real-time the data from their trading book.
"For the last six months, we have been talking about their trading book," he added.
Its trading book - which is volatile and where any bank can take sudden, large losses - is smaller than it was.
And changes in how its trading book is valued will rob it of €2 billion when calculating regulatory ratios.
Though his superiors had ordered him to reduce the risk on his trading book, he instead ratcheted up the position.
This inadequacy was particularly significant for RBS, given that the purchase of ABN AMRO significantly increased RBS's trading book assets.
Mr. Thode said that "there are a number of employees involved in the various activities related to our trading book".
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