Class Action Against Two Major Banks Offers to Settle for $300m

A class action lawsuit against two of New Zealand's largest banks, ASB and ANZ, is offering to settle for a payment of over $300 million. This potential settlement comes after allegations that the banks overcharged customers by breaching credit laws between 2015 and 2019.

Over 150,000 customers were affected during this period due to improper disclosures by the banks, resulting in excessive fees and interest charges. The proposed settlement was revealed before a finance and expenditure select committee, which is currently considering changes to the credit contracts and consumer finance act.

Consumer advocacy groups have raised concerns that the proposed legislative changes could potentially undermine the legal actions taken by affected customers. They argue that these changes might allow banks to avoid future accountability for similar misconduct.

It is worth noting that both banks have already made amendments to address these issues. In a separate settlement with the Commerce Commission, ASB and ANZ have already paid over $43 million for the breaches that occurred during the relevant period.

While the proposed $300 million settlement is a significant financial commitment, it could offer a resolution for the many customers impacted by the banks' actions. However, the outcome of the select committee's review will play a crucial role in determining the final terms of the settlement and the broader implications for consumer protection laws in New Zealand.

This development highlights the growing importance of financial transparency and consumer rights in the banking sector. As the situation unfolds, it will be essential for both regulators and the public to remain vigilant in ensuring that such misconduct is not repeated in the future.