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Clydesdale Bank facing more pressure on compensation claims

Clydesdale Bank’s parent company, National Australia Bank, has recently announced that it intends to set aside further funds to deal with compensation claims from customers in the UK.  The precise figure is not yet clear.  It will be made public when National Australia Bank issues its half year figures at the end of March 2014. 
Clydesdale Bank and Yorkshire Bank have come under increased scrutiny over the past few months in respect of their Tailored Business Loans. There has been considerable political and regulatory activity around these commercial loans.  Clydesdale Bank maintain that they are simple fixed rate loans, which should fall outside the remit of the Independent Review currently being handled by the Financial Conduct Authority.  Customers have argued that these loans contain “embedded swaps” and should therefore be part of the review into the miss-selling of interest rate hedging products. 
The announcement from National Australia Bank has confirmed that there remains a wide range of “uncertain factors” relating to regulatory conduct issues involving Clydesdale Bank.  The announcement went on to say that “regulators continue to take an active stance in our management claims including … interest rate hedging products.” There has also been an increase in the level of complaints and settlements relating to some Tailored Business Loans. 
Balfour+Manson are acting for a number of SMEs in connection with claims involving Tailored Business Loans.  If you require any further information, please contact Gordon Deane on 0131 200 1485 or by email at gordon.deane@balfour-manson.co.uk