Bank – Loan. The Chancery Division ruled on the second set of proceedings arising out of a dispute as to the entitlement of the defendant Royal Bank of Scotland (the bank) to add the costs of unwinding an interest rate swap to the amounts required for the early redemption of a loan granted to the claimants by the bank. The bank had contended that it had only discovered the external interest rate swap agreement after the determination of the first proceedings and that those proceedings had been not decided the question of whether an external swap could amount to a 'funding transaction'. The court held that the bank ought to have carried out reasonable diligence, which would have revealed the swap, and that the bank should have put forward the external swap in the first proceedings. Accordingly, it held that the claimants would be entitled to resist a claim that the bank was entitled to add the break costs from an external interest rate swap to the redemption charges, were they to redeem the loan, because to advance such a claim would be an abuse of process within Johnson v Gore Wood & Co (a Firm)[2001] 1 All ER 481.