Overcast

Overcast

max temp: 9°C

min temp: 5°C

ESTD 1874 Search

Banking: Compensation payouts over rate-swap mis-selling nearly double in a month

11:49 10 January 2014

The rate of compensation payouts over rate-swap mis-selling increased markedly in December, new figures have revealed.

The rate of compensation payouts over rate-swap mis-selling increased markedly in December, new figures have revealed.

Banks have increased the pace of granting compensation to small businesses over allegations that they were mis-sold complex financial products, with pay-outs reaching £158.6million in December.

shares

It means the total nearly doubled in just a month, after standing at £81.2m at the end of November, according to figures from the Financial Conduct Authority (FCA).

However the figure represents just a small proportion of the £3billion set aside by major lenders so far to cover the costs of making redress to victims, although that figure will also include the expense of administering the scheme.

The FCA has previously written to the chief executives of Royal Bank of Scotland, HSBC, Barclays and Lloyds urging them to increase the pace of compensation for the interest rate swap products.

Martin Wheatley, head of the City regulator, has said the delays compound the unfairness of selling a complex product to companies without an understanding of the risks, leaving many struggling to make ends meet.

But the FCA adopted a more positive tone when it issued its monthly update on the scheme today.

It said a total of 1,040 offers of compensation had been accepted by customers by the end of December, up from 547 in November.

Director of supervision Clive Adamson said: “Banks have picked up the pace since November; we asked that they focus their efforts on making far more rapid progress in assessing individual cases and crucially in providing redress.

“May remains the target for all offers to have been sent out and the banks involved are working towards that. Any affected business that has been invited to join the scheme and hasn’t needs to act now so they can receive the redress they’re due.”

A total of 18,700 customers had been invited to join the review by the end of December.

Anthony Browne, chief executive of the British Bankers’ Association, said: “Anyone who wrongly suffered as a result of having been mis-sold an interest rate hedging product will get appropriate and fair redress.

“Banks are working hard to complete the reviews and as the regulator notes today the process is speeding up.”

shares

0 comments

Mark Bee and his deputy Lisa Chambers at Endeavour House in Ipswich after they saw off last year's challenge to their leadership.

Conservative councillor Mark Bee is to step down as leader of Suffolk County Council after four years in the role.

Voting isn't the only form of political engagement

The ideological machine that is meant to serve us has gone wrong and is tyrannising us, but that doesn’t mean we should boycott the ballot box

Suffolk has an ageing population - but can we cope?

Dramatic increases in the average age of people in Suffolk have been highlighted in a report which reveals that in some areas nearly one in 10 are expected to be aged 85 or over in the next two decades.

Damage to overhead wires between Diss and Stowmarket - photo courtesy of Greater Anglia

Rail users face an afternoon and evening of severe delays on routes between Norwich and London, after high winds caused damage to overhead power lines between Stowmarket and Diss.

There is the potential for sweeping changes at Braintree District Council come election day – though in practice that is unlikely to happen.

Klaudia Sokolowska

Police are searching for a 14-year-old girl in Felixstowe who has gone missing for the third time in three months.

Hunting for eggs

Will you be feeding the newborn lambs at The Museum of East Anglian Life, trying your hand at archery at Ickworth House or hunting eggs at The Middy’s Steam up this weekend?

Princess Anne meets Livability Treetops Service Manager Janet Bilton during her visit to Livability Treetops in Colchester on Tuesday.

The Princess Royal flew in to Colchester today as part of her work supporting a disability charity.

Firefighters were called to the house fire

Firefighters were called to a house fire in Stowmarket this afternoon.

Fears over future of probation service in Suffolk and elsewhere in East Anglia

Criminals jailed for up to a year could be supervised over the phone and use kiosks to report to the probation service electronically once they are released back in the community.

Most read

Most commented

Topic pages