Last month, Barclays, HSBC, Lloyds and RBS agreed to provide appropriate redress where mis-selling of the products had occurred, following a review of sales.
A further seven banks – 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 – have now volunteered to join the review and redress exercise.
These latest banks account for about 10% of the overall interest rate hedging product sales in the UK, although the regulator confirmed it has not examined their sales and therefore not made any finding of mis-selling.
The products, also known as swaps, were meant to protect businesses against rising interest rates but came with huge costs if rates fell.
Clive Adamson, director of supervision in the Conduct Business Unit, said:
“This is a major exercise but one that we hope will ensure even more businesses benefit from having their individual situation reviewed.
“I am pleased that Allied Irish Bank (UK), Bank of Ireland, Clydesdale and Yorkshire banks, Co-operative Bank, Northern Bank and Santander UK have agreed to join the larger banks in reviewing their past sales.”
He added: “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.”
Meanwhile, the FSA has also agreed with the four larger banks the terms of reference for their independent reviewers, including giving each customer the right to have an independent reviewer present during any meetings or calls with the bank.
