UK banks speed up swaps mis-selling payout

British banks are making progress in the settlement of tens of thousands of interest rate hedge mis-selling, the Financial Conduction Authority revealed today.

In the last month the total they have paid out rose from just  £15.3 million to £81.2 million.

Of the near 30,000 cases under review almost 1,000 have now been settled. Of these, 547 received compensation from the banks and 438 did not require pay-outs.

The regulator last month told the banks that they had to speed up the process which has seen them set aside as much as £3 billion for total claims.

Today, Clive Adamson, director of supervision at the FCA, said: “I welcome the fact that these figures show the pace of the banks’ reviews continuing to increase, and more businesses and customers are starting to receive compensation payments, but we will keep the pressure on to ensure they continue to move as quickly as they can.”

He added: “Last month we wrote to the chief executives of the four major banks to reassert our expectation that redress should be delivered to customers quickly and to agree practical ways to speed up the process.

“The banks’ responses have been positive, with three of the four major banks saying to us they now expect to complete all initial redress determinations by May 2014.”

Eight of the nine banks under review have agreed to separate the initial mis-selling claim from any subsequent claims for consequential losses which has speeded up the process.