Santander today announced it was not going to publish its third quarter results because of uncertainty over the full scope of the Financial Conduct Authority motor finance redress scheme.
The Financial Conduct Authority (FCA) recently published its consultation paper on the redress scheme after the Supreme Court ruling and Santander argues – like many finance houses – that its approach differs from the court’s ruling in specific cases.
It joins several banks which have upped the amounts they expect to pay following the FCA paper.
“Santander UK is reviewing the consultation in detail to understand its potential implications noting that the FCA’s proposed approach differs in important respects from the Supreme Court’s ruling, the legal basis for the redress scheme’s relevant period is not clear and it remains at the consultation stage.
“There is therefore uncertainty regarding the final scope, methodology and timing of any redress scheme that may ultimately be implemented.
Santander UK outgoing CEO Mike Regnier said: “We believe that the level of concern in the industry and market is such that material changes to the proposed FCA redress scheme should be an active consideration for the UK Government.
“Without such change, the unintended consequences for the car finance market, the supply of credit and the resulting negative impact on the automotive industry and its supply chain could significantly impact jobs, growth and the broader UK economy. This could also cause significant detriment to the consumer.
“While the FCA considers the outcome of its consultation, we believe it is our duty to do all we can to secure an orderly and fair outcome from this consultation process.
“This is not a question of investor versus customer interest, quite the reverse. What is at stake is the supply of credit that customers need and that supports a very important sector for the economy.”
