SME banking 2002 behavioural undertakings: CMA reports on banks’ compliance audits
CMA annual assessments of compliance with undertakings given by a number of banks not to bundle loans and accounts.
In 2002, certain banks agreed that they would no longer (except in specific circumstances) make a small and medium-sized enterprise (SME) customer open or maintain a business current account in order to get a business loan or deposit account. This practice is commonly known as ‘bundling’ and is prohibited by the behavioural undertakings.
In 2014, certain banks agreed to submit annual audit reports of their compliance systems and procedures to the Competition and Markets Authority (CMA) so it can assess compliance with the undertakings. The CMA reviews these and publishes its findings each year in the reports on compliance below.
The following banks are subject to the bundling prohibition:
- AIB Group (UK) plc (previously known as First Trust)
- Bank of Ireland
- Barclays Bank plc and Barclays Bank UK plc
- Clydesdale Bank plc’s SME Business and Branches in Scotland branded as Virgin Money
- HSBC UK Bank plc. HSBC’s non-ringfenced bank HSBC Bank plc remains subject to the Undertakings but was released from the 2014 Agreement during 2023
- Certain group companies of Lloyds Banking Group plc, formed from the merger of HBOS plc and Lloyds TSB Bank plc
- Northern Bank Limited (Danske)
- NatWest Group plc (formerly the Royal Bank of Scotland Group plc) which includes Ulster Bank Limited in Northern Ireland.
The SME banking audit reporting template and guidance should be used by the banks for submitting these reports to the CMA.
To enforce compliance, we have issued directions to certain banks:
- First Trust and HSBC (the Directions to HSBC have since been replaced by the newer Directions, linked below)
- Barclays
- HSBC
- Natwest
The letters we’ve written to companies in breach of the undertakings are also available.
Documents
Updates to this page
Last updated 8 July 2024 + show all updates
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SME banking annual report on compliance 2022 – 2023 added
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Guidance updated
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First published.