FSA grants HSBC PPI extension

The Financial Services Authority has agreed to grant HSBC time extensions for the handling of payment protection insurance complaints.

The terms of the temporary arrangement are the same as those granted to Barclays, Lloyds Banking Group and Royal Bank of Scotland by the FSA earlier this week.

The regulator says it will extend the time periods all four banks have to deal with their backlog of stayed PPI complaints and the high volume of new complaints on PPI in order to ensure they are able to handle the complaints properly.

Under normal FSA rules, PPI complaints have to be responded to within eight weeks, but under the temporary conditions complaints put on hold during the judicial review will receive a decision by the end of August, while complaints received after the conclusion of judicial review but on or before August 31 will be responded to within 16 weeks, and complaints received on or after September 1 and before December 31 2011 will be responded to within 12 weeks.

The FSA expects all PPI complaints handling to return to the requisite eight-week standard by January 1 2012 at the latest.