Hundreds of businesses to sue CYBG over miss-sold loans
Hundreds of small businesses are to press ahead with a £350 million legal action against CYBG over claims they were miss-sold loans.
RGL Management, which represents the SMEs, expects to make a claim against Clydesdale and its former parent, National Australia Bank (NAB), in the first half of next year.
RGL alleges that small businesses suffered a loss from tailored business loans that were sold to them between 2001 and 2012.
Last month RGL brought in All Square Finance to help bring hundreds more businesses to join the suit and the company said the claim size is growing.
The announcement from RGL comes ahead of CYBG, parent company of Clydesdale Bank, publishing its financial results on Tuesday.
James Hayward, RGL’s chief executive, said he is “extremely confident” about the legal merits of the case.
“This is especially so given the persistent failure of both defendants to disclose pertinent information requested repeatedly over a period of nearly a year as part of pre-action protocol correspondence.”
“Thousands of affected businesses will hope that tomorrow the bank acknowledges our claim,” he said.
CYBG was formed in 2016 after the NAB divested its UK operations and the bank recently completed a £1.6 billion takeover of Virgin Money.
A CYBG spokeswoman said: “We are engaged in correspondence with RGL’s solicitors in connection with the historical sale of fixed-rate tailored business loans.
“No claim has been received. The bank has dedicated substantial effort in recent years working through this historic conduct matter, engaging openly and transparently with customers as part of a wide-ranging remediation programme. We have made significant progress in resolving the vast majority of cases.
“The allegations contained within the correspondence are not accepted by the bank and if necessary will be defended in the strongest terms possible.”