Banks Responses to 8th October

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Barclays

We are pleased that as a result of the two decisions the Court has reached this year, it is now clear that neither Barclays past charges nor those in force in January 2008 are unenforceable penalties.

The Judge has also reached the same conclusion in relation to the charges which applied to Woolwich current accounts until September 2007, when the last accounts were transferred into Barclays current accounts.

We continue to work with the OFT and to participate in the court case that started in January this year. We hope for an early resolution and one that gives clarity for consumers and banks alike

Natwest

In summary:

• The court decided that the current charges are not penalties.
• The Judge also found that the banks' current terms are sufficiently clear to enable the typical consumer to have a proper understanding of them for sensible and practical purposes.
• The Judge found that the terms and conditions relating to unarranged borrowing charges are assessable for fairness under the Regulations. He was not asked to rule on whether the banks' terms were fair or not.

Nationwide

On 8 October 2008, the court issued its judgement on whether the banks' historic overdraft charges are capable of being penalties. Nationwide was not part of this exercise, because the OFT agreed that our historic terms and conditions relating to charges are so similar to our current terms and conditions that, on the basis of the judge’s earlier ruling, they do not amount to penalties.

LLoyds TSB

On October 8 2008 in his judgment about Lloyds TSB’s historic T&Cs:

• The judge concluded that our historic overdraft charges are not penalty charges.
• However at this time the judge has decided not to make a formal legal ruling about our historic charges, as he would like further discussion about a specific legal point.
• This legal point relates to the fact that our historic T&Cs are made up of a combination of written T&Cs and some general law.
• The judge has not yet made any ruling for any bank regarding whether historic T&Cs are assessable for fairness.

HSBC

On 8 October 2008 the Court issued its judgment on this second stage of the test case process and confirmed that (subject to any appeal), HSBC's historic terms and conditions did not amount to penalties. It confirmed in part 1a of the case that HSBC's current terms and conditions were also not capable of being penalties.
Further Court hearings will be required before the test case process is concluded, including an appeal of the first stage judgment, which starts on 28 October 2008. The Court will also decide whether terms and conditions previously used by the Banks are assessable for fairness under the Unfair Terms in Consumer Contract Regulations 1999 ("UTCCRs").

Abbey National

On 8 October 2008 the Court issued its judgement on this second stage of the test case process. The Banks are currently considering its implications and further details about the judgement will be published shortly.
Further Court hearings will be required before the test case process is concluded, including an appeal of the first stage judgement, which starts on 28 October 2008.

Clydesdale

Today (8 October 2008), the High Court delivered its judgement on the current stage of the test case on unarranged overdraft charges. The Case is between seven banks and one building society with the Office of Fair Trading. This stage considered the terms & conditions previously used by them, and whether they were capable of being penalties under common law.
The Court found that Clydesdale and Yorkshire Banks’ charges levied under previously used terms & conditions are incapable of being penalties.
Further Court hearings will be required before the test case process is concluded. This will include an appeal of the first stage judgment by the Banks and the building society, on the question of whether the current charges can be assessed for fairness. This commences on 28 October 2008.

HBOS

On 8 October 2008 the Court issued its judgment on this second stage of the test case process. The Court has decided that Halifax and Bank of Scotland's historic charges cannot be penalties.

The Court has not yet issued a ruling on whether the banks' previous charges are assessable for fairness under the UTCCRs. This will be dealt with shortly.

Further Court hearings will be required before the test case process is concluded. This includes an appeal by the Banks on the question of whether the current charges can be assessed for fairness, which starts on 28 October 2008.

Please feel free to post updates from others banks on the Test Case