Banks dealing with swap claims on their own terms
The Financial Conduct Authority (FCA) may have ordered banks to review their sales practice of interest rate swaps but, despite many affected businesses hanging on by a thread, latest figures suggest banks are still running to their own schedule.
Banks were set a deadline of May 2014 to review all interest rate swap cases. However figures published by the FCA show that they are increasingly likely to fall short of this timeframe.
|Lender||Should have completed
(% of cases)
(% of cases)
|Lloyds Banking Group||89%||73%|
|Royal Bank of Scotland||70%||61%|
Barclays is already working to its own completion date of June after it announced it did not expect to meet the May deadline.
Senior partner, Simon Cottrell, urges the FCA to follow through on its threat of fining banks for missing deadlines:
“This lack of urgency is appalling; lenders are failing to grasp the severity of this situation, a situation they created. Yet as shocking as it is, it comes as no real surprise and until the FCA properly disciplines these failures then nothing will change.
“What is more alarming though is that a significant number of those affected are leaving their case to chance. By not having independent legal representation, businesses are trusting the people responsible for the scandal with their claim. This I am dumbfounded by.
“The FCA may have instructed banks to review interest rate swap sales but this does not guarantee automatic redress. In fact I’ll let the figures speak for themselves; so far 94 per cent have had the sale judged ‘non-compliant’ yet over a fifth of swap claims have been rejected. Something definitely isn’t adding up!”
Content correct at time of publication