ID :
78326
Fri, 09/04/2009 - 14:58
Auther :
Shortlink :
http://m.oananews.org//node/78326
The shortlink copeid
BankWest facing possible class action
BankWest may face a class action lawsuit by commercial loan customers angry over changes that the Commonwealth Bank of Australia (CBA) subsidiary made to their lending facilities last year.
Property industry participant Guy Goldrick said on Thursday that he had received a
"huge" number of responses to his advertisement in The Australian Financial Review
last week asking BankWest's commercial customers that had loans called up in the
past 12 months to contact him.
"The responses so far have hugely exceeded my expectations," Mr Goldrick told AAP.
Mr Goldrick said the aggrieved customers had loans from $2 million to "well above"
$50 million and were involved in the construction, property development and wider
commercial sectors.
He said BankWest had taken action on the commercial lending facilities in the latter
half of calendar 2008 and its actions had had negative repercussions for the
aggrieved customers.
The timing of the bank's actions was significant, Mr Goldrick said.
"What's interesting is that there appears to be a common thread in many cases of
when the problems between the bank and these clients began," Mr Goldrick said.
"A lot of these people have also indicated to us that they were caught out by the
bank's sudden action as they believed that either their businesses or developments
were profitable and their relationship with the bank sound."
Mr Goldrick said he was in discussions with several legal firms and had sourced a
funder for the proposed class action but declined to comment on their identity.
He also declined to discuss the substance of the allegations.
A BankWest spokesman declined to comment until further details were known.
"However, if indeed it (the class action) does proceed we will look to defend our
position vigorously," a bank spokesman said.
CBA paid $2.163 billion to take over BankWest and St Andrews Australia Pty Ltd from
UK banking giant HBOS plc in October last year after HBOS plc was rescued for
STG12.2 billion ($A28.06 billion) from a mortgage funding shortfall by Lloyds TSB.
The acquisition was announced by CBA on October 8 but was not completed until
December 18 when Treasurer Wayne Swan approved the deal.
Last month CBA told analysts it had made a 52 per cent increase in individual
provisions for bad debts to $1.729 billion and a 30 per cent increase in its
collective provisions to $3.225 billion for the six months to June 30, partially
because of a rise in doubtful debts from BankWest customers.
Of the individual provisions, $745 million was derived from CBA's commercial
customers and $620 million from BankWest customers, and another $321 million in
single name exposures, CBA said.
Of CBA's troublesome exposures to June 30 including those from BankWest, the highest
proportion, or 24 per cent, was derived from the property sector.
Property industry participant Guy Goldrick said on Thursday that he had received a
"huge" number of responses to his advertisement in The Australian Financial Review
last week asking BankWest's commercial customers that had loans called up in the
past 12 months to contact him.
"The responses so far have hugely exceeded my expectations," Mr Goldrick told AAP.
Mr Goldrick said the aggrieved customers had loans from $2 million to "well above"
$50 million and were involved in the construction, property development and wider
commercial sectors.
He said BankWest had taken action on the commercial lending facilities in the latter
half of calendar 2008 and its actions had had negative repercussions for the
aggrieved customers.
The timing of the bank's actions was significant, Mr Goldrick said.
"What's interesting is that there appears to be a common thread in many cases of
when the problems between the bank and these clients began," Mr Goldrick said.
"A lot of these people have also indicated to us that they were caught out by the
bank's sudden action as they believed that either their businesses or developments
were profitable and their relationship with the bank sound."
Mr Goldrick said he was in discussions with several legal firms and had sourced a
funder for the proposed class action but declined to comment on their identity.
He also declined to discuss the substance of the allegations.
A BankWest spokesman declined to comment until further details were known.
"However, if indeed it (the class action) does proceed we will look to defend our
position vigorously," a bank spokesman said.
CBA paid $2.163 billion to take over BankWest and St Andrews Australia Pty Ltd from
UK banking giant HBOS plc in October last year after HBOS plc was rescued for
STG12.2 billion ($A28.06 billion) from a mortgage funding shortfall by Lloyds TSB.
The acquisition was announced by CBA on October 8 but was not completed until
December 18 when Treasurer Wayne Swan approved the deal.
Last month CBA told analysts it had made a 52 per cent increase in individual
provisions for bad debts to $1.729 billion and a 30 per cent increase in its
collective provisions to $3.225 billion for the six months to June 30, partially
because of a rise in doubtful debts from BankWest customers.
Of the individual provisions, $745 million was derived from CBA's commercial
customers and $620 million from BankWest customers, and another $321 million in
single name exposures, CBA said.
Of CBA's troublesome exposures to June 30 including those from BankWest, the highest
proportion, or 24 per cent, was derived from the property sector.
