More than 10,000 Bank of New Zealand customers are to receive a payout totalling $3.8 million to make up for errors it made relating to loan documents.
The bank said it discovered the errors after reviewing its systems following changes to the Credit Contracts and Consumer Finance Act with some errors going back to 2015.
The problems include the bank not sending out documentation to customers quickly enough when customers changed their accounts or sending out documents with missing or incorrect information like total interest and total payments.
While some new credit card or home loan accounts were set up with old documentation because the rules changed before they were finished processing.
BNZ said customers would receive a refund on some of the interest and fees they had been charged with the average refund around $375 although some would be as low as 1 cent.
The bank said refunds under $4.99 would be round to $5.
Impacted customers would have their refund automatically deposited into their account or have a cheque posted to them in the next few days.
BNZ chief executive Angie Mentis apologised for the errors.
"No customers were overcharged, but we didn't get it 100 percent right.
"While mistakes do happen from time-to-time, finding those mistakes and fixing them is simply the right thing to do for our customers," Mentis said.
BNZ said most of the issues were discovered and fixed within one month of them occurring and all customers now had the right documentation.
Asked why it had taken so long to fix errors made in 2015 a BNZ spokesman said it had been working internally and with advisers for a while to make sure it got in touch with all affected customers to correct the information sent to them, which it finished doing last year.
"Since then we've been working with the Commerce Commission to make sure they agree with our interpretation of how the CCCFA applied in these cases, and to make sure everything we were doing was correct."
He said the bank was now confident it had now sorted out all the issues.
