In today’s news, Seven more banks have agreed to review their business loan sales (swap loans) to small businesses for mis-selling practices. The city watchdog has already found ‘serious failing’ at four other banks for swap mis-selling or interest rate swaps.
Mis Sold Swap Products
The Financial Services Authority (FSA) has stated that there is no presumption of mis-selling from these seven, however customers will be compensated will be compensated if mis selling emerges from the review.
The BBC carries on to report :
The seven banks that have now also agreed to review their sale of these products are Allied Irish Bank (UK), Bank of Ireland, Clydesdale and Yorkshire banks (part of the National Australia Group, Europe), Co-operative Bank, Northern Bank and Santander UK.
This group accounted for about 10% of UK sales of these hedging products. ‘Major exercise’ Last month, it emerged that Barclays, HSBC, Lloyds and RBS could face a bill of more than £1bn after agreeing with the FSA to study the sale of about 28,000 interest rate protection products sold to small businesses since 2001.
The products were offered to thousands of small firms – including pub owners, haulage firms, care-home operators and vets – when they asked their bank to take out a loan. The borrowers were told that the product would provide an ‘insurance’ or ‘hedge’ against the risk of interest rates rising, but rates then fell and they faced heavy losses. Many borrowers claim that they were pressurised into buying these products.
Regarding the latest review by the seven banks, Clive Adamson, of the FSA, said: ‘Although the number of their sales was smaller and while there is no presumption that mis-selling has occurred, it shows their willingness to do the right thing and ensure their customers who bought these products can be confident that they will be treated on an equal basis.
‘This is a major exercise but one that we hope will ensure even more businesses benefit from having their individual situation reviewed.’ The FSA said this review could take a long time, but that it would be independently assessed.
Interest Rate SWAP News
FCA May Fine Banks Involved With Interest Rate Swap Mis-Selling
Banks who sold complex insurance products could possibly be fined by the Financial Conduct Authority. The deals were intended to protect the borrowers from rising interest rates. However, many businesses saw their payments increase drastically with the interest rates at a historic low.
FCA Interest Rate Swap Flowchart
Derivatives may be one of the most complicated financial investments on the market. The Financial Conduct Authority (FCA) has created a chart to help consumers, barristers and bureaucrats understand whether a potentially mis-sold Interest Rate swap Hedging Product (IRHP) can be reviewed.
The Financial Conduct Authority (FCA) Interest Rate Flow Chart uses a flow diagram with “Yes/No” questions to show whether a debtor qualifies for regulatory review.
Small Business Disillusioned with mis-sold Interest Rate Swaps
Many businesses have become disillusioned due to the compensation schemes set aside for the interest rate swap mis-selling derivatives. The Financial Services Authority has agreed to look into the cases of the mis-sold financial products of the big four banks (Barclays, Royal Bank of Scotland, Lloyds, and HSBC). There are several other banking institutions that have become involved in this Swap claims dilemma, also.
Interest Rate SWAP Claims UK
Maple Leaf Financial have a specialist team of solicitors dedicated to dealing with the mis-selling of interest rate swap protection products by the banks. We are happy to review these relatively complex swap arrangements and to claim compensation for our clients where appropriate.
If you believe you have incorrectly been classified as a ‘sophisticated’ customer and have, therefore, not been eligible for interest rate swap redress. Maple Leaf Financial will review your interest rate product and we will be happy to discuss your individual concerns and requirements
Tim Capper reports on Financial Mis-Selling for Maple Leaf Financial. Our aim is to ensure you get honest advice and proper guidance to ensure a suitable recommendation can be made to pursue a financial claim
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