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Santander sets aside £232m for ‘customer conduct issues’

Santander 480

antander UK has set aside £232m to deal with undisclosed “historic customer conduct issues”.

The bank announced the provision in its quarterly management statement for the nine months to the end of September, published last week.

It is unclear what products the provision relates to, although Santander UK says the amount is separate to the £731m it set aside in June 2011 for compensation relating to payment protection insurance misselling.

Money Marketing understands the provision is connected to interest rate swap sales by the bank and sales of identity fraud insurance.

Santander UK says: “In September 2012, a provision of £232m was made in relation to conduct remediation for historic customer conduct issues and in the light of an evolving regulatory environment.”

It emerged last week that Santander’s decision to abandon a deal to buy 316 Royal Bank of Scotland Group branches cost the bank £52m.

Santander made a £1.1bn pre-tax profit for the first nine months of the year, up 4 per cent from £1.06bn at the same time last year. Over the same period, its share of the UK mortgage market fell from 16.3 per cent to 10.8 per cent, while gross lending fell 32 per cent.

Chadney Bulgin mortgage partner Jonathan Clark says: “In the current age, it seems it is only a matter of waiting for the next wave of misselling to come around the corner. Banks’ reputations are in tatters because they just do not look after people properly.”

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