SBS Bank is being considered by the Commerce Commission on issues related to the Credit Agreement and Consumer Finance Act (CCCFA).
Tuesday, November 29, 2022 at 12:59 PM
This problem has arisen in the run-up to the draconian new rules coming into effect under the CCCFA on December 1st of last year.
SBS acknowledges that this process may result in some form of compensation for the customer.
An alternative could be some form of enforcement action taken against SBS.
Details of what prompted the action were not disclosed. But his SBS disclosure statement to the stock exchange gave a rough outline.
“In preparation for legislative changes related to the Credit Contracts Act Amendments Act of 2019 (CCCFA), SBS self-reported several issues related to CCCFA change disclosure compliance prior to December 1, 2021,” it said. I have read the statement.
“This investigation is ongoing and the results are currently uncertain but may lead to customer remedial or regulatory action.”
In a later statement, SBS management said they were unable to provide further information as the investigation was ongoing.
“We are in direct negotiations with the Commerce Commission on these issues.”
The Commerce Commission’s statement was similarly brief.
“The Commerce Commission is investigating SBS’s compliance with the CCCFA,” it said.
“As this investigation is ongoing, the Commission cannot provide any further information at this stage.”
Two banking experts contacted by Good Returns stressed that they had no personal knowledge of the case, but thought it could be an example of “overdisclosure.”
According to this theory, the disclosure regime is so strict that some banks are on the safe side and are making more disclosures than usual.
SBS previously announced a six-month profit of $17.96 million, down 24.8% from the same period last year, due to higher operating expenses and higher credit impairment charges.
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