London’s High Court ruled in favor of Clydesdale Bank and its former owner, National Australia Bank (NAB), in a case regarding alleged unfair break fees on loans sold to small businesses up to two decades ago.
The case, brought by four businesses against NAB and Clydesdale Bank (now part of Virgin Money UK Plc), aimed to establish liability before seeking compensation.
Over 900 other firms were closely monitoring the proceedings, viewing it as a test case with potentially wide-ranging implications.
Allegations and Judgment
The businesses, represented by claims management company RGL Management, alleged that the banks charged hefty costs for early repayment of fixed-rate Tailored Business Loans (TBLs) and misrepresented the fixed interest rates as market rates.
However, in a 185-page judgment following a 12-week hearing, Judge Antony Zacaroli concluded that Clydesdale Bank had the right to calculate its losses from early loan repayments. Also, the deceit allegations involving 15 former bank employees failed to be substantiated.
Reaction and Next Steps
RGL Management expressed disappointment with the judgment. RGL Management was likely involved in some legal proceedings or litigation that resulted in an unfavorable outcome for them.
They are considering their options, including the possibility of appealing the decision. This means that they are not satisfied with the ruling and are exploring further legal avenues to potentially overturn it.
Both NAB and Clydesdale Bank welcomed the judgment. Clydesdale Bank specifically expressed satisfaction with the ruling, which favored the bank regarding historically tailored business loans.
This implies that the judgment was in their favor and aligned with their interests. NAB, despite having sold Clydesdale Bank in 2016, also approved of the court’s decision.
NAB still holds a vested interest or concern in the legal matters concerning Clydesdale Bank, even after divesting its ownership.
While RGL Management is disappointed and exploring options for appeal, NAB and Clydesdale Bank are satisfied with the ruling, indicating a favorable outcome for them.
