DRN-5985687

The complaint E is a company. It complains through its director, whom I’ll refer to as Mr H, about the way in which National Westminster Bank Plc handled its application for a business loan. What happened In June 2025 Mr H discussed with E’s relationship manager an application for a four-year £50,000 business loan. A formal loan application was made with the help of the relationship manager on 27 June. Over the following two weeks Mr H submitted additional information as requested by the bank, but on 10 July 2026 the loan application was declined. Mr H complained on behalf of E about how the application had been handled. He thought that the relationship manager had misrepresented the likelihood of approval, had not kept him updated on the progress of the application, had not disclosed key underwriting criteria and had relied on unrelated conversations to justify the bank’s actions. NatWest considered E’s complaint but said that the lending decision was final and would not be reviewed. Mr H referred E’s complaint to this service, where one of our investigators considered what had happened. She issued an initial assessment but did not recommend that the complaint be upheld. Mr H did not accept that assessment and asked that an ombudsman review the case. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. In keeping with this service’s primary role as an independent and informal dispute resolution service, I have not addressed in detail each and every argument put forward on behalf of E. I have however considered very carefully all the evidence and submissions of both parties before deciding what in my opinion is fair and reasonable. Mr H has been clear, in particular in his response to the investigator’s assessment, that E’s complaint is not about the lending decision. For completeness, however, I should explain that lending decisions are generally a matter for the prospective lender’s commercial judgment, and this service will not usually interfere with them. I see no reason for me to do so here. Mr H says that E’s relationship manager misrepresented the likelihood of the application being successful. I don’t believe however that the evidence supports that accusation. Having considered that evidence carefully, I think that the manager indicated that he was willing to support the application and wanted it to be successful. He did, as Mr H says, convey reassurance, but I don’t believe it was wrong of him to do so. He made it clear however that any application would need approval from the bank’s credit department. I don’t believe he needed to do any more to explain that the application might not be successful.

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Mr H also says that he was not told what factors – including previous years’ performance and future sustainability – would be taken into account. However, I would not necessarily expect the bank to provide that information. Its role was to consider the application that E made, not to set out its lending criteria so that E could tailor its application accordingly. Had it done so, it might have been accused of discouraging an application without considering it fully. NatWest noted that Mr H had discussed the possibility of a loan earlier in 2025 and that Mr H should therefore have known what might be required. Mr H says that conversation was about a different proposal (which did not go ahead) and so should not be relied on. As I have said, I don’t think the bank had to explain its lending criteria in advance, but any loan application will take into account a lender’s ability to repay it over its full term. Between the date of the application and the date on which it was declined, Mr H was in regular contact with the relationship manager. Having reviewed their exchanges, I don’t believe I can fairly say that the manager failed to keep Mr H updated. On the contrary, he told Mr H what stage the application had reached and, where appropriate, what else he needed to provide. He was unable to say exactly when the bank would provide an answer to the application, but he did explain that as well. The application was reviewed and a decision made within two weeks. I don’t believe that was unreasonable or that there was any undue delay. It was of course unfortunate that Mr H had to spend time on a loan application which was not successful, but that is not unusual and is in some cases part of running a business. My final decision For these reasons, my final decision is that I do not uphold E’s complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask E to accept or reject my decision before 25 May 2026. Mike Ingram Ombudsman

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