FSA may investigate interest rate swap sales

Published on 21/06/2012 00:00

The Financial Services Authority (FSA) has been asked to look into contracts bought by businesses to insure against unexpected rises in interest rates.

Fearing another case of mis-selling, the treasury select committee wants a probe into the sale of interest rate swaps to thousands of small companies that may be sitting on losses.

Martin Wheatley, head of conduct at the FSA, said he was focusing on the big four banks – Barclays, HSBC, Lloyds and RBS – which sold 95 per cent of the swaps.

“We think there are a number of questions to answer,” Wheatley told the treasury committee yesterday. The FSA will publish an update at the end of June.