It will now have 12-to-16 weeks to resolve complaints, depending on when they were received. Under Financial Services Authority (FSA) rules, the usual period for handling claims is eight weeks.
HSBC joins Barclays, Lloyds and RBS in the temporary arrangements.
This comes after the massive volume of claims about PPI mis-selling that banks have that has left them unable to cope with the backlog, partly caused by them unilaterally putting claims on hold pending the result of a High Court judicial review.
On 20 April, the British Banker's Association (BBA) lost that case against the FSA, meaning banks must contact and compensate customers who were mis-sold PPI.
HSBC, Lloyds and RBS are under the following mandate:
- PPI complaints still with the firm but put on hold during the judicial review will need to be resolved by the end of August.
- Complaints received after the conclusion of the judicial review but on or before 31 August must be resolved within 16 weeks.
- All complaints received on or after 1 September and before 31 December must be resolved within 12 weeks.
The banks will also need to keep PPI complainants and their customers fully informed and provide the FSA with regular compliance reports.
The handling of PPI complaints should return to the requisite eight weeks by January 2012.
Barclays, which this week agreed to pay everyone on hold, no questions asked, has a slightly different mandate.
All PPI complaints received between 21 April and 31 July must be resolved within 16 weeks and complaints received between 1 August and 1 October have a 12-week deadline.
All new PPI complaints received after 1 October will fall within the standard eight-week resolution period.