New Zealand Banking Association chief executive Roger Beaumont said banks are responsible lenders. They typically have dedicated teams to deal with those experiencing financial difficulty and mortgagee sales were “rare and always a last resort”.

Roger Beaumont, CEO of the New Zealand Banking Association, defended the proposed amendment: “Between 2015 and 2019, any lender who even made a small mistake… could be subject to a draconian provision in the law.”

“That consequence would be totally out of proportion with the technical legal breach, especially if there was no harm to the consumer who was happily enjoying their new home or car thanks to a bank loan.”

Financial Markets Authority (more…)

Financial Markets Authority (more…)

The New Zealand Banking Association has welcomed the amendment Bill, saying it tidies up the existing legislation to ensure that all breaches are treated the same as those currently.

Roger Beaumont, chief executive of the New Zealand Banking Association, told the committee that minor disclosure errors – “like getting their phone number wrong” – could result in the full repayment of interest and fees under the current law.

The NZ Banking Association told the committee it had been lobbying for 10 years to overturn what it argues are “disproportionate” penalties that two previous governments have declined to legislate away.

Roger Beaumont, chief executive of the Banking Association, told the select committee that between 2015 and 2019 any lender making any mistake in the information they provided to borrowers “like getting their phone number wrong” could be subject to a draconian provision in the law that “on one interpretation” could require the lender to repay them all the fees and interest they had charged until the mistake was fixed.

Importantly, the proposed amendment to the law does not stop consumers or regulators taking action against lenders for information disclosure breaches. Nor does it stop any cases currently before the courts. It merely confirms that the courts should apply a ‘just and equitable’ approach. It would be up to the courts, as it should be.