ASB repays $8.1m to customers

ASB Bank is repaying $8.1 million to loan customers after admitting it breached responsible lending rules.

More than 73,000 customers who changed the terms of their home or personal loans will be compensated.

Customers will receive either $68 or $135 depending on when their loan was taken out.

ASB admitted that from June 2015 to June 2019 it failed to provide required information to customers who made changes to their loans.

The bank’s systems failed to pick up the breach or fix it within a reasonable time.

ASB reported the problem to the Commerce Commission in September 2019. In February 2021, it reached a settlement with the commission admitting to breaching the Credit Contracts and Consumer Finance Act and agreeing to compensate borrowers.

It’s the latest admission from a major bank that’s fallen foul of consumer protection laws. In March, ANZ was fined $280,000 after selling customers credit card repayment insurance that offered them no cover.

Last year, Westpac repaid a total of $3.7m to 19,000 customers after the bank admitted breaching consumer credit laws.