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Seven more banks join FSA interest rate swaps review

Seven more banks have agreed with the FSA to review their sales of interest rate swaps and pay redress to small and medium-sized businesses where they have been missold.

Allied Irish Bank (UK), Bank of Ireland, Clydesdale and Yorkshire Banks, Co-operative Bank, Northern Bank and Santander UK have agreed to carry out independent reviews after the FSA agreed the redress programme with four major banks last June.

Last month, Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland agreed with the FSA to review interest rate swap sales and pay “appropriate redress”. Following a two-month review, the FSA said it had found “serious failings” in the way the products were sold.

The FSA says it has not examined the banks’ sales of interest rate swaps and so has not made any finding of misselling.

The regulator has now agreed the terms on which Barclays, HSBC, Lloyds and RBS should carry out the reviews as cases have to be independently assessed.

FSA conduct business unit director of supervision Clive Adamson says: “The terms of reference we have agreed for the independent reviewers shows the detailed and thorough scrutiny that we will expect of them.” 

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