UPDATE: Close Brothers also declines to challenge car finance redress

Sun, 26th Apr 2026 09:04

(Alliance News) - Close Brothers Group PLC has joined fellow lenders Barclays PLC, and Lloyds Banking Group PLC, in deciding against a legal challenge to the UK Financial Conduct Authority's motor finance compensation scheme, Sky News reported on Saturday.

"Close Brothers does not intend to challenge the FCA's motor finance redress scheme," the London-based merchant bank said, in a statement provided to Sky News late on Saturday. "While there are elements of the scheme that we disagree with, after careful consideration we believe that the existing scheme offers a quick, clear and certain route to resolving this matter for all relevant parties."

This follows Sky learning on Friday that Barclays would not be challenging the FCA's GBP9 billion compensation scheme for consumers who were mis-sold car finance agreements between 2007 and 2024.

The regulator confirmed last month that firms are expected to pay out compensation totalling around GBP7.5 billion, down from a previous estimate of GBP8.2 billion, with the total bill rising to GBP9.1 billion when including the cost of running the scheme.

"Sky News has learnt that Barclays decided on Friday not to challenge the [ruling]," the outlet said.

Barclays closed down 1.0% at 423.70 pence per share on Friday in London.

Sky had previously reported that the Finance & Leasing Association was leaning towards challenging the FCA over the proposed scheme, and could announce its board's decision "as early as Sunday."

A group of other lenders are still preparing to take legal action against the FCA, ahead of the Monday deadline to launch a challenge.

Sky added on Friday that "Santander Consumer Finance, an arm of the Spanish banking giant, is said to still be deliberating over the issue."

By Emma Curzon, Alliance News reporter

Comments and questions to newsroom@alliancenews.com