RBS shareholders have lashed out at executives over branch closures and its treatment of small business customers.

Shareholders at its AGM on Wednesday urged bosses to further review or completely halt closures, with the bank having recently announced plans to close 162 branches across England and Wales.

It adds to 259 closures announced last autumn.

Chairman Howard Davies blamed the latest round of closures on its competition responsibilities linked to its £45bn government bailout during the financial crisis, having scrapped plans to sell off its Williams & Glyn network.

Instead, RBS is being forced to encourage SME customers to switch to other lenders in hopes of increasing competition.

"It would be difficult for customers to transfer or get them to transfer if their branches were still open," the chairman said.

Chief executive Ross McEwan added that he was "well aware of the issues" for communities and vulnerable customers, but said the take-up of digital banking had been "much more dramatic than I would have expected."

"I'm convinced that if we as a bank don't respond or put in place other alternative actions ... this bank will continue to have difficulties."

Regional officer Lyn Turner batting away suggestions that changing banking behaviour was the cause of so many closures.

"This is purely about profit. They are turning their backs on local communities and local businesses."

Shareholders also vented anger over the company's mistreatment of small business at the hand of its now defunct turnaround unit, Global Restructuring Group (GRG), having been accused of pushing firms towards failure in the hopes of picking up assets on the cheap.

Gavin Palmer, who said he "only bought shares in RBS to sort you out and your bad practices" also pushed Mr McEwan on his apology over GRG, asking whether it would have been made if MPs on the Treasury Select Committee had not pushed so hard for the full report's release.

Mr Davies insisted that the bank did apologise for "parts of the bad treatment" which were identified in the report, but admitted the report "did tell us things we did not know."

"Did you not listen to what people were saying at previous AGMs?" Mr Palmer asked.

"Did you not see (former chief executive) Mr (Stephen) Hester go bright red with shame as soon as GRG was mentioned?

"Did you not notice all the shareholders...complaining about the bad treatment in small business, medium, large, listed PLC's as well?"

Mr Davies replied that the board carried out its own review into the controversial division.