Financial Conduct Authority chief executive Martin Wheatley has admitted redress for interest rate swap misselling is being paid “more slowly” than it wants and says banks will struggle to meet their deadlines to pay out.
Last month, the FCA published figures showing just 10 businesses missold interest rates swaps had received redress payments out of 32,000 claims so far.
In January, banks agreed to review the sale of interest rate swaps, which are designed to protect consumers against increases in interest rates. The banks involved in the review are Barclays, HSBC, Lloyds Banking Group, Royal Bank of Scotland, Santander, Clydesdale and Yorkshire Banks, Co-op Bank, Allied Irish Bank and Bank of Ireland.
Wheatley said: “It’s coming along more slowly than we wanted. When we started we hoped it would be substantially complete within six months from April.
“Clearly from the published figures it is not moving as fast as that. We hoped the majority will be complete in six months with one year as the final date, which will be quite a challenge to get to.”
Wheatley says banks have written to customers and are using forbearance when businesses are struggling to survive before receiving compensation.