The director also said the bank did not respond appropriately when it complained to the bank about the loan. The director sought compensation for extra interest incurred by the company as a result of the bank’s failures, the loss of a tenant in the commercial property and the costs of refinancing with another bank. The director also sought compensation for the personal stress, anxiety and inconvenience he had suffered as a result of the bank’s failures.

Our investigation

The original loan documents clearly said the term was for one year and set out the repayment requirements. The company had also referred to the maturity date when requesting interest-only repayments. The bank later communicated with the company through its authorised broker about restructuring the loan. We found the bank had communicated adequately about the initial loan’s maturity date.

The restructured loan documents disclosed the key terms of the loan, and the company signed the documents in November 2022 agreeing to those terms. However, the bank did not follow its usual process to set up the loan or adequately explain the loan’s more complex features, including the ability to split portions of the loan on different interest rates. It also did not give the company access to business internet banking until April 2024. Without such access, it could not easily view or manage the loan. The bank also failed to supply the monthly interest notifications required by the agreement. It then did not adequately respond to the company’s queries about loan repayments and interest rates.

The bank also failed to respond to the company’s complaint-related correspondence in July 2025, although it followed an appropriate complaint process after responding the following month.

The bank's failure to communicate clearly about the loan and respond to the company’s queries meant the company, in our view, lost the opportunity to manage its interest rate between June 2023 and May 2024 and therefore paid more interest than it probably would have if it had had that opportunity. Another consequence was disruption to the company’s financial planning, which caused it inconvenience. We could not consider the director’s claim for compensation for stress and inconvenience suffered in his personal capacity because our rules state that a complaint can be made only by the person or entity receiving the banking service in question, and it was the company, not the director, that received the service (or the lack thereof). We also could find no evidence directly linking the loss of the company’s tenant or its refinancing costs to the bank's failures.

The bank had earlier offered $6,100 to cover the extra interest the company had paid and $2,000 for the inconvenience it had suffered. We considered the offer fairly recognised the impact on the company of the bank's failures.

Outcome

We upheld part of the company’s complaint and found the bank's offer of $8,100 fair and reasonable. The company accepted the bank's offer.