The U.K. Financial Conduct Authority (FCA) fined HSBC nearly 6.3 million pounds (U.S. $8 million) for failing to properly consider the financial position of customers who missed payments.

HSBC did not conduct affordability assessments on customers who had fallen into arrears on their mortgages, credit cards, and other bank-issued debt, the financial regulator said Thursday in a press release. The FCA added the bank took “disproportionate action” on customers who fell into default in their debt.

“The failings were caused by deficiencies in HSBC’s policies and procedures and the training of their staff, as well as inadequate measures to identify and address instances of unfair customer treatment,” the FCA said.

HSBC received a 30 percent discount on the fine for agreeing to settle and its remediation efforts, the FCA acknowledged.

The details: From November 2017 to October 2018, HSBC U.K. conducted a review of its handling of accounts in arrears and found customers received unfair outcomes in approximately 44 percent of cases, the FCA’s final notice alleged. HSBC reported the results of the review to the FCA.

HSBC regularly offered short-term payment relief to customers experiencing long-term financial difficulties, which often led to more defaults, the FCA said.

Another issue was the bank’s automated default system placed customers in arrears even if they had low amounts owed, which negatively affected their credit records for up to six years, per the final notice. For mortgage holders, such actions could lead to a potential repossession action, the FCA said.

The FCA’s rules require lenders to show forbearance and due consideration to customers whose accounts fall in arrears and to develop a plan that allows them to pay the balances due without suffering unnecessarily.

Compliance considerations: HSBC invested £94 million (U.S. $119.5 million) in “identifying the issues and putting them right,” the FCA said, and also issued redress payments worth over £185 million (U.S. $235.2 million) to more than 1.5 million customers.

In 2019, the bank implemented new policies and procedures “designed to identify customers who may have suffered financial detriment, harm or distress, and inconvenience as a consequence of the weaknesses identified with HSBC U.K.’s treatment of customers in arrears and to offer them remediation,” the final notice said.

HSBC did not respond to a request for comment.