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Mis-sold Tailored Business Loans

Clydesdale / Yorkshire Bank have so far set aside £330 million (as at September 2017) in provisions for conduct risk relating to the mis-selling of Payment Protection Insurance, Interest Rate Hedging Products and Tailored Business Loans.

Tailored Business Loans are a brand name for a certain type of business loans provided by Clydesdale and Yorkshire Bank from around 2000 onwards. It is believed that there are around 11,000-12,000 Tailored Business Loans of which 8,000 of these are fixed rate Tailored Business Loans. Many of the risks of fixing or structuring the interest rate were not explained to the customer during the sales process of the loan. Such risks include the cost of breaking or terminating the loan early as well as not benefitting from decreases in the base rate of interest.

Many TBLs have not been included in the Financial Conduct Authority (FCA) Interest Rate Hedging Product (IRHP) Review Scheme. Clydesdale / Yorkshire Bank have set up a voluntary (non- s.166) review of the sale of Tailored Business Loans which mirrors many of the features of the FCA IRHP Review Scheme. However, this voluntary review only applies to selected TBLs which contain a Structured Collar, or “Category A” products or Capped Rate Loans, “Category C” products.

Even if you don’t have a “Category A or C” product, then you may still have a valid claim. It just means that the mis-selling review will be conducted through the Clydesdale / Yorkshire’s complaints process rather than the voluntary review. It will also mean that there will be no Skilled Person, or Independent Reviewer overseeing the review process.

For a full list of TBLs together with their product name and category, please see the table in the Additional Information Section.

What is a Tailored Business Loan?

Obligations of the Sales Person or Adviser for Tailored Business Loans

How was this service mis-sold?

Compensation

Table: Tailored Business Loan FCA Category, Product Category and Name

Additional Information

PDFs

Information relating to Clydesdale and Yorkshire Banks Review of Interest Rate
Treasury Committee David Thorburn

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