The Commerce Commission has announced it has filed proceedings against Westpac NZ in the High Court.
It alleged the bank breached lender responsibility principles, after multiple failures meant customers did not receive legally required information about their loans and, in some cases, agreed interest rate discounts.
The responsible lending principles impose obligations on lenders when advertising, before entering into a loan, and during all subsequent dealings with borrowers and guarantors.
Commerce Commission competition, fair trading, and credit general manager Vanessa Horne said the Commission expected banks to invest in robust compliance practices to ensure they are complying with the Credit Contracts and Consumer Finance Act 2003 (CCCFA).
Horne said banks’ failure to do so can have a detrimental impact on their customers and deprive people of crucial information they are entitled to.
“The Commission believes Westpac failed to invest in adequate systems and processes to ensure it complied with its CCCFA obligations,” she said.
The bank has admitted to the breaches and was finalising its remediation for the borrowers impacted.
Westpac responds
In a statement, a Westpac spokesperson told 1News the matter related to “historical issues with some Westpac products which we identified and self-reported to the Commerce Commission in early 2022”.
“The issues relate to compliance with the responsible lending provisions of the Credit Contracts and Consumer Finance Act (CCCFA) for some customers.
“We worked promptly to close the identified compliance gaps, and we are in the final stages of completing remediation for customers as applicable.
They said the bank had “co-operated fully with the Commerce Commission investigation”.
“Westpac and the Commerce Commission are aligned in their views on the appropriate penalty, and it is not expected to have an impact on our 2H25 results.”
The penalty will be determined by the High Court in due course.
