GovWire

• HSBC has been directed to make changes to prevent further breaches

• HSBC, Lloyds, TSB, and AIB have been issued with public letters

Under the Retail Banking Market Investigation Order 2017 put in place by the Competition and Markets Authority (CMA) after it found competition concerns in the retail banking market banks and building societies are required to follow strict rules when it comes to informing customers about their products and services. This includes showing correct interest rates for loans and accurately displaying the right locations for bank branches and ATMs.

The Order also put in place Open Banking, an initiative which set high standards for transparent and secure data sharing for retail banking services in the UK. It enables a wide range of data on products and services to be used by third parties to create innovative apps and to improve services such as comparison sites, which make choosing a bank easier.

HSBC, Lloyds, TSB and AIB all failed to make available correct data on their products or services and have breached the Order in the following ways:

• HSBC failed to keep information about its branches accurate and up to date 167 closed branches were listed as still being open and two open branches were not listed.
• HSBC failed to keep some of its annual rates for business loans and overdrafts accurate and up to date on its website.
• HSBC told some customers the incorrect maximum amount they would be charged for going into unarranged overdraft on their Personal Current Accounts.

• TSB failed to disclose the maximum amount customers would be charged for going into unarranged overdraft on their Personal Current Accounts.

• AIB failed to make available the correct annual rates for some loans and some overdrafts through Open Banking and on its own website.
• Lloyds failed to make available addresses of 363 ATMs through Open Banking.

Compliance with the Order is closely monitored by the CMA and banks are obliged to report all incidences of non-compliance within 14 days.

Lloyds, TSB and AIB have confirmed they are making changes to their operations to prevent further breaches ranging from enhancing their internal procedures, to improving oversight by senior managers, updating internal checklists and retraining staff.

In the case of HSBC - which the CMA considers has breached the Order more extensively in this instance - added measures are needed to prevent future breaches. To start the process, the CMA has issued HSBC with detailed directions which include an action plan to ensure full compliance in future.

Dan Turnbull, Senior Director at the CMA, commented:

People deserve banks they can trust to serve them well. Having correct information is essential when making important decisions about our finances. Banks handling our hard-earned money should have adequate processes in place to ensure this happens.

Its disappointing that 7 years on, we have to put in place formal enforcement measures to secure better compliance from a major bank like HSBC which, yet again, is in breach of the rules.

The CMA will continue to closely monitor all banks compliance to ensure customers can clearly and confidently manage their finances.

Notes to editors

1. The Directions for HSBC and the letters to HSBC, Lloyds, TSB and AIB have been published online, which include details of the breaches and the actions the banks have taken.
2. The CMAs market investigation into the retail banking market (Retail Banking Market Investigation) found separate adverse effects on competition (AECs) in the retail banking markets in both Great Britain and Northern Ireland. The CMA put in place theRetail Banking Market Investigation Order 2017 to address its concerns.
3. The Open Banking remedy in Part 2 of the Order requires the 9 largest banks and building societies in Great Britain and Northern Ireland to have open and common banking standards for securely sharing transaction data and to grant free access to this data to Third Party Providers. These providers, using this data, can compete to provide innovative, secure services to consumers.
4. Since the Retail Banking Market Investigation Order 2017 has been in force, the CMA has written publicly to banks 35 times and issued 5 sets of legally-binding directions all to help banking consumers receive correct and accurate information. To date, customers have received more than 47m in refunds
5. All enquiries from journalists should be directed to the CMA press office by email onpress@cma.gov.ukor by phone on 020 3738 6460.
6. All enquiries from the public should be directed to the CMAs General Enquiries team ongeneral.enquiries@cma.gov.ukor 020 3738 60
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