"FirstRand has criticized the regulator's intervention into the car finance market as 'disproportionate and unfair', warning that it will now be forced to pay out as much as £750 million to motorists who were mis-sold finance deals."
"The decision raises fresh concerns about the UK's attractiveness as a financial hub, with critics warning that regulatory intervention and rising costs risk driving investment away."
"The controversy centres on historic commission arrangements in the car finance market, where lenders and brokers were accused of failing to disclose incentives that increased consumers' borrowing costs properly."
FirstRand is considering leaving the UK market, citing an 'unfair' compensation scheme imposed by regulators on the car finance sector. The bank may sell its UK challenger bank, Aldermore, after a ruling by the Financial Conduct Authority led to increased compensation costs. FirstRand could face up to £750 million in payouts for mis-sold finance deals and may need to set aside an additional £510 million for potential claims. This situation raises concerns about the UK's attractiveness as a financial hub and the impact of regulatory interventions on investment.
Read at London Business News | Londonlovesbusiness.com
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