Top 10 tips for claiming for a Mis-sold Tailored Business Loan
Clydesdale Bank plc, owners of the banking brands Clydesdale and Yorkshire Banks, recently increased their provisions for Mis-sold Tailored Business Loans and Stand Alone Interest Rate Hedging Products to £442million. Although this seems like a significant sum, it is still dwarfed by provisions other banks have set aside for mis-sold Swaps, such as Barclays and Royal Bank of Scotland who have provisioned over £1 billion each.
If you believe your business has been mis-sold an interest rate hedging product, commonly known as a ‘Swap’ and you bank with Clydesdale or Yorkshire Bank, then you need to be aware of several key differences between Clydesdale and Yorkshire Bank hedging products and those supplied by the other main high street banks, and how this could affect your chances of successfully claiming financial.
We are a specialist firm of ex-banking professionals and in-house lawyers that are experts in assisting business claim redress for the mis-selling of these complex banking products. We’ve compiled a list of 10 key considerations for those businesses that are looking to claim against Clydesdale and Yorkshire Bank for a Mis-sold Tailored Business Loan:
#1. Clydesdale and Yorkshire Bank sold two types of Interest Rate Hedging Products to businesses throughout the UK. (1) Stand Alone Hedging Products and (2) Tailored Business Loans. Be sure to check which type of product you hold.
#2. Clydesdale and Yorkshire Bank have increased their provisions relating to the mis-selling of Interest Rate Hedging Products and Tailored Business Loans to £442million or an increase of 9-fold in one year. If you have one of these products, then there is a good chance that you will be entitled to a proportion of this compensation.
#3. A Tailored Business Loan is effectively a brand of a type of hedging product. Only three banks in the UK provided Tailored Business Loans. Clydesdale, Yorkshire and Northern Bank (now Danske Bank). Check to see if you have had a business bank account with one of these three banks since 2001.
#4. A Tailored Business Loan differs from a Standalone Hedging Product in that the Tailored Business Loan ‘embeds’ or hides the derivative used to provide the hedging WITHIN the commercial bank loan. Check to see if your loan documents has the wording “Tailored Business Loan” within it.
#5. Stand Alone Interest Rate Hedging Products (IRHPs) are included in the Financial Conduct Authorities Review into the mis-selling of IRHPs, Tailored Business Loans are not included. Check to see if you have received a letter from your bank inviting you to participate in the review scheme.
#6. However, there is a ‘mirror review’ that Clydesdale and Yorkshire Bank have set up to review some types of Tailored Business Loans. These products are labelled “Category A” or “Structured Collars” – Again, check to see if you hold one of these Category A products.
#7. Even if you don’t hold a Category A product, you can still seek to achieve redress if the product has been mis-sold by using the banks’ complaint process.
#8. Before complaining or having your product reviewed in the FCA scheme, make sure you get all the information available from your bank. You can do this by submitting a Subject Access Request (SAR) to your bank and they should release some documents on your file that they hold. Having this information will help you build your case against the bank for mis-selling. If you haven’t done so already, put a SAR application into your bank.
#9. If the bank does not uphold your complaint, you can potentially appeal this decision if it’s a Category A product or you can take your case to the Financial Ombudsman Service who will independently adjudicate on your case. Check to see if your business is eligible for the Financial Ombudsman.
#10. Don’t forget about Consequential Losses relating to your claim if relevant. Consequential Loss are losses that have flowed from the mis-selling of the interest rate hedging product such as additional fees, loss of business opportunity or forced fire-sale of assets at discounted prices. You will need to formulate your Consequential Loss claim in parallel with your basic redress claim for all Clydesdale and Yorkshire Bank cases. Be sure to speak to a qualified Forensic Accountant, as Consequential Loss claims can be quite complex in nature.