THE Newcastle Permanent is to be credited for apologising in its annual report, released in mid-October, to customers short-changed because of a 'mistake' in the way it calculated interest on some mortgage accounts.
Australians were shocked, shattered and battered by the extent of appalling behaviour uncovered in 2018 during the banking royal commission. But they weren't surprised.
So the Newcastle Permanent's review in 2019 of its offset accounts linked to mortgage accounts was a prudent step, given the issue was explored at the banking royal commission, and big banks were found wanting.
The apology and acknowledgment of the 'mistake' that underpinned the $4.2 million problem affecting 18,000 customers is welcomed.
But the failure to refer to the apology at all in a media release announcing the annual report's release is unfortunate. The only reference to the issue in the media release doesn't even earn the description of a 'mistake'.
Instead the issue is reduced to a reference to "one-off costs associated with customer remediation work" that appears in the media release buried in a quote.
It's hard to avoid the feeling that the Newcastle Permanent was trying to limit the damage of this very embarrassing issue, that is too much like the kinds of 'mistakes' committed by the big four banks and uncovered at the royal commission.
It's hard to avoid that the building society had to acknowledge it in the annual report, but struggled to take the extra step of highlighting it in the media release which appears on the Newcastle Permanent website.
It's no disrespect to institutions to say that not many people would bother to read an annual report. A media release, though, is distributed to media outlets. Any reference to an apology for a $4.2 million 'mistake' affecting 18,000 customers would have been reported.
As it is the 'mistake' is being reported prominently now. And presumably a lot of people in the Hunter would have known by the time 18,000 customers are advised they're owed money.
The Newcastle Permanent, rightly, highlights its strong history and associations with this region as a vital, and respected, institution. It owned its 'mistake'. It's a shame it didn't quite clear the final hurdle.
Issue: 39,515.
