UK watchdog to complete enforcement probe into RBS business unit in July

LONDON (Reuters) - Britain's markets watchdog said it expected to complete its enforcement investigation into alleged mistreatment by Royal Bank of Scotland <RBS.L> of small business customers by the end of next month.

Lawmakers and small businesses have criticised the Financial Conduct Authority (FCA) for not bringing its investigation to a speedier conclusion and publishing the findings.

"My expectation is that we will finish the investigative part before the end of July," FCA Chief Executive Andrew Bailey told parliament.

He could not say whether there would be enforcement action related to RBS's Global Restructuring Group (GRG).

The FCA has also faced criticism for the time being taken to investigate alleged misconduct at Lloyd's Banking Group's HBOS division.

No conclusion appears imminent there.

"We are going through extensive amounts of evidential material," Bailey told parliament's Treasury Select Committee.

The watchdog has had contact with a party suggesting there may be extensive further information being held privately, which was "somewhat dismaying", Bailey said.

"The idea there is more material out there not been made known to us previously is not something we wanted to hear," he said.

(Reporting by Huw Jones; editing by John Stonestreet)