I am really pleased that the banks have agreed to provide compensation to SMEs that were mis-sold interest rate swaps in the run-up to the financial crisis.

The Financial Services Authority has said that Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland will provide redress to SMEs after it uncovered “a range of poor sales practices” including inadequate disclosure of exit costs and “failure to ascertain the customers’ understanding of risk”.

The banks have all agreed to immediately halt the sale of complex interest rate hedges to smaller businesses and have pledged to compensate potentially thousands of customers who have been hurt by the products that have left some firms with hundreds of thousands and even millions in costs they say they were never warned about.

I entirely agree with the Chairman of the Treasury Select Committee, Andrew Tyrie, when he says that the mis-selling was completely unacceptable, and we need to establish how we got into a situation where these products were permitted to be marketed and sold so inappropriately and to examine what steps have been taken to give us confidence that this will not happen again.