Alexander complained this was unfair. He said he had been trying to refinance his lending but said the bank had changed its position about what needed to be paid and its security requirements. He also said the bank delayed setting up merchant facilities, affecting his company’s cashflow. 

Our investigation

The mortgages and guarantees secured all lending owed by Alexander and Yvette, the company and the trust. In examining correspondence between Alexander and the bank, we found the bank did not change its position about the lending and security. Alexander’s refinancing effort failed because the lender he wanted to switch to required a mortgage over one of the properties – a security the bank was not obliged to release unless all debt was repaid. The bank later approved in principle to release both mortgages if most of the debt was repaid – but this did not happen.

In examining the merchant facility records, we found the bank did not unreasonably delay setting them up. Alexander did not supply all the information the bank requested. The bank followed up with him when forms and an indemnity were missing. In any event, the company’s existing merchant facilities continued to operate while the company traded.

We reviewed the steps taken before proceeding to a mortgagee sale. The bank allowed time for arrears to be cleared, lending to be restructured, or debt to be refinanced or repaid. It later deferred further action after statutory notices expired. We found the bank acted fairly and reasonably in progressing mortgagee sale action.

Outcome

We did not uphold Alexander’s complaint.