AN NHS healthcare centre in Coventry says it has lost out on £500,000 for patients – by being short-changed in a compensation payout by a high street bank.
Coventry Health Limited, a group of doctors and medical practitioners who own Holbrooks NHS health centre – has been fighting RBS (Royal Bank of Scotland) over the ‘mis-selling’ of a 25-year £3million loan to develop the centre, taken out around the time of the financial crash in 2008.
The doctors claim the “unfair” terms of the loan by 2009 involved high-risk and expensive interest payment arrangements, and they were not fully informed by the bank.
The loan terms included a complex hedging ’25-year interest rate swap’ arrangement.
The Financial Ombudsman service (FOS) has upheld their complaint.
The bank has now indicated it will pay out £150,000.
But the healthcare centre in Wheelwright Lane, Holbrooks, says that amount is the legal minimum, and claims it is out of pocket by a further £500,000.
Ombudsman Colin Brown’s ruling states the bank should fully re-imburse Coventry Health Limited for any payments it made above the amounts it would have paid under interest rate arrangements capped at 5.5 per cent, even if that amounts to more than the legal minimum.
Mohammed Ihsan, of Coventry Health Limited, told us: “The GPs had various ideas to build on the services for patients. But we’ve not been able to do that because of our predicament.
“We could have done a great deal more with that money in terms of providing local services.”
Dr Bettina Kleine, a director of Coventry Health Limited, said: “We are deeply disappointed by the decision made by RBS. Not only is this an injustice for the dentists, pharmacists and GPs working under our wing, but for the many residents in our area.”
They say the development plan, which had not advanced because of the loan terms, included increasing the number of rooms and more healthcare services, including out-of-hospital care, extended hours primary care, end-of-life care, dental implants, and facilities for social services and other public services.
Daniel Fallows, director of Coventry Health’s representatives Seneca Banking Consultants, said: “After months of awaiting a response from the bank, they have ruled against Coventry Health and are refusing to award the full figure recommended by three separate members of the Ombudsman service.
“Royal Bank of Scotland clearly mis-sold the complex derivative, and the healthcare centre is now being punished by being deprived of half a million pounds. This could have been a life changing amount for Coventry Health.”
An RBS spokesman said: RBS assesses all FOS recommendations on compensation on a case-by-case basis and will pay above the FOS limit when appropriate.
He added: “RBS adopted a consistent approach when assessing interest rate hedging products (IRHP) complaints that were eligible for the Financial Conduct Authority’s IRHP past business review, and applies the same approach with respect to those customers in the review who subsequently appeal to the Financial Ombudsman Service.”