A BANK boss has apologised to customers after the regulator fined it £20.7 million for “serious failings” in the way it handled payment protection insurance complaints.

The Financial Conduct Authority said staff from the Glasgow-based Clydesdale and sister operation Yorkshire Bank failed to take into account all relevant documents when dealing with complaints.

It also provided false information to the Financial Ombudsman Service in response to requests for evidence of the records Clydesdale held on PPI policies sold to individual customers.

The matters relate to complaint handling processes between May 2011 and July 2013. It is the largest ever fine imposed by the FCA for PPI failings.

Georgina Philippou, FCA acting director of enforcement and market oversight, said: “Clydesdale’s failings were unacceptable and fell well below the standard the FCA expects. The fact that Clydesdale misled the Financial Ombudsman by providing false information about the information it held is particularly serious and this is reflected in the size of the fine.” The failings also relate to Yorkshire Bank, also part of National Australia Bank.

Out of 126,600 PPI complaints decided between May 2011 and July 2013, up to 42,200 may have been rejected unfairly and up to 50,900 upheld complaints may have resulted in inadequate redress for customers.

Debbie Crosbie, Clydesale acting chief executive said: “In 2011 we introduced changes to our policies and procedures that were designed to help us respond to PPI complaints. A number of these changes were inappropriate and have disadvantaged some of our customers. We got this wrong and I am sorry for that.

“We deeply regret any instance which led to the Financial Ombudsman Service receiving incorrect or incomplete information from us.

“These practices were not authorised or condoned by the banks. As soon as this issue was discovered, we took immediate steps to stop it, we made the regulator aware and rapidly introduced strict new monitoring procedures to prevent any recurrence.”