CLYDESDALE Bank's withdrawal from commercial property lending will have a significant impact on the Scottish economy, a new action group has claimed.

The bank last month offloaded £5.6 billion of loans to parent National Australia Bank (NAB) and businesses in Scotland are already being told that as soon as their loans mature, they will not be renewed.

It is thought that most of the loans include embedded interest rate swaps, which because of the fall in interest rates now carry huge breakage fees.

However, as The Herald has reported, the most widely-sold "fixed rate tailored business loans" are tied to swaps but are excluded from the bank's mis-selling review now under way.

Now an NAB Customer Support Group, formed by around 20 Clydesdale and Yorkshire business borrowers and part of the wider 750-strong Bully-Banks campaign, is lobbying MSPs and MPs. It has been encouraged by two new provisional rulings against banks by the Financial Ombudsman Service, which Bully-Banks says represent "a fundamental sea-change" in the ombudsman's stance towards interest rate swap agreements (IRSAs).

John Glare, spokesman for the NAB "support" group, said the transfer of the commercial lending portfolio to Melbourne was "catastrophic for the economy, especially in Scotland". He said break fees were added by the bank to a customer's overall liabilities, at the same time as the bank was insisting on revaluing properties, pushing companies into default. Mr Glare questioned whether the £5.6bn included "the IRSA breakage penalties currently running at between 20% and 40%".

The Herald has been contacted by a significant number of Clydesdale customers in the past fortnight.

One whose businesses indirectly employ 50 people said he could have rebanked with Santander or Lloyds but for a prohibitive £150,000 breakage fee to the Clydesdale. He said: "I have been transferred to NAB, and told my loan will not be renewed when it comes up for review next year."

He said the outcome could well be that "all those people will be on the dole".

A Clydesdale spokesman said: "NAB is committed to maintaining constructive dialogue with customers throughout the remaining loan term. NAB wishes to see each CRE loan repaid at end of its term, ie maturity. To suggest that this is having a significant impact on the Scottish economy misunderstands the size and composition of the loan book and the nature of the Scottish economy."

He said breakage fees and the need for advice were fully explained to borrowers, and had interest rates gone up, "the gain would have been passed on to the customer".