Ulster Bank has reached a settlement with property developer David Agar over allegations of mis-selling derivative products relating to property loans, according The Irish Times.
RBS subsidiary Ulster Bank reportedly reached a private agreement with the property developer last week to write off €30m (£23.5m) of loans and swaps. The bank allegedly sold Agar the products in 2007, but did not properly explain that he would have to make dividend payments to the bank when interest rates fell.
The bank has denied advising Agar on the derivatives.
The outcome of the case could have widespread implications for developers in the UK and Ireland claiming to have been sold unsuitable derivatives linked to property loans. Last month ,the FSA said that there had been “serious failings” in the selling of interest rate swaps to small businesses to protect against rising interest rates.
Ulster Bank declined to comment.
sophia.furber@estatesgazette.com
