The Financial Conduct Authority has confirmed that Barclays is the only bank to not split redress payments to victims of mis-sold interest rate swap agreements, despite eight other firms opting into the process.

"Eight out of the nine banks have now agreed to split payments for initial redress and consequential loss," said the FCA in a statement.

"We expect this change to simplify and speed up the process for paying basic redress to customers.

"The exception is Barclays who will consider splitting payments for customers on a case by case basis, including for customers in financial distress," said the regulator.

Out of the four biggest banks in Britain, HSBC was the first to announce that it plans to compensate all customers more quickly with a new system that will pay firms redress before consequential losses are determined.

RBS opted for the same approach a day later and Lloyds followed closely behind with the same process.

The FCA has revealed that Britain's biggest banks are speeding up the process for reviewing alleged victims of mis-sold IRSAs after writing to the groups' chief executives last month.

Barclays confirmed to IBTimes UK that its position over split payments has not changed since the last FCA update.

"It is in Barclays' interests as well as our customers to complete this complex review as fast as possible and our 600 dedicated staff are working hard to achieve this. Where we have made mistakes, we will put them right," said Barclays in a statement to IBTimes UK.

"On a case-by-case basis and in order to support customers in financial distress, Barclays will consider carefully any request to provide an advance on redress offers to businesses whilst their consequential loss claims are being processed, and has already done so on several occasions.

"However, all customers due redress are being provided with a redress offer covering cash flow refunds together with compensatory interest at the same time they receive their review outcome, and can have the entire amount paid within 24 hours of our receipt of their acceptance, subject to the normal processes and checks for payments."

"Barclays has built a quick and clearly defined consequential loss assessment process which is now in full swing. If a customer submits a claim within 40 days of their redress offer, we will review and provide them with a final redress offer within 28 days of receipt of their claim."

Redress and Consequential Losses

IRSAs are contracts between banks and customers where typically one side pays a floating or variable rate of interest and receives a fixed rate of interest payments in exchange.

Such contracts are used to hedge against extreme movements in market interest rates over a given period. Companies that saw the value of these products move against them as rates fell during the recession now owe banks inordinate sums of money in yearly interest payments.

Previously under the FCA interest rate hedging product review, no payments could be made from banks to customers until the entire process of determining redress was completed.

This prevents a party being able to make claims over and over again and costing firms multiple sets of bills from fresh reviews.

When a bank is being contested about a swap it has sold, it firstly determines whether the product has been mis-sold, with the help of an independent reviewer. It then calculates what redress to offer.

The bank then offers the client a redress package, which can include anything from a refund of swap payments to a restructuring of a business loan at a better rate.

This is different from compensation.

Consequential loss claims, which involve the party providing evidence that it incurred losses as a result of the IRSA, are filed separately.

This means that while a bank can make an initial redress offer - a product tear-up or switch and/or compensation - if a company is claiming for consequential losses on top of this, then it would have to wait until after the banks have assessed the application for damages.