Tailored Business Loans (“TBLs") were sold mainly by Clydesdale and Yorkshire Bank ("the Banks") between 2001 and 2009 on the basis of creating a fixed rate loan tailored to the individual customer. TBLs, unbeknown to the vast majority of customers, utilised
an "embedded" interest rate product, to mitigate the Bank’s losses arising from rate movements in the money markets. Customers signed up to an apparently simplistic product, only to learn at a later stage that extricating themselves from the loan would expose
them to substantial and unaffordable break costs which were never brought to their attention.
Under rigorous Parliamentary questioning during the Treasury Select Committee on SME lending, David Thorburn, CEO, admitted that TBLs were complex products sold to customers who had no understanding of their mechanics and in many instances were unsuitable.
Following the Parliamentary Forum, the Bank agreed to initiate its own "internal complaint led review", which is in a number of respects, similar to the FCA led review into the sale of interest rate hedging products ("the Review") which has resulted in financial
redress for many SMEs.
The sale of TBLs was prevalent between 2001 and 2009. There are strict time limits for the issue of Court proceedings and there is a real danger that for many TBL customers they will be out of time to protect their legal rights. Further, the announcement
of the end of the Review is expected imminently, and it is clear that given the review of TBLs is a voluntary process, the Banks will follow suit and TBL customers will be left with little or no options for redress.
It is imperative to promptly review your TBL. Contact our Banking Team on 0161 829 2599 or email us at
email@example.com for an initial no-obligation discussion to consider your options.
(The information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Berg or any of its partners or employees. Professional legal advice should
be obtained before taking, or refraining from taking, any action as a result of this article.)