Bank’s bid to streamline activities ruffles feathers

Some clients at HSBC are reeling from the news that they are set to be charged an administration fee of Lm4 per quarter if the average balance of their combined savings and current accounts does not exceed Lm75.

The bank’s customers have recently started receiving a notice informing them of new terms and conditions linked to savings and current accounts. However, several people have voiced a worry that they may be misinterpreting some of the terms, especially as the Maltese and the English texts provide conflicting versions.

Under the English version of ‘Terms and Conditions’ pertaining to a savings account, paragraph 5 clearly states: "The bank will charge an administration fee of Lm4 per quarter if the average of the combined balances of an account holder’s savings and current accounts does not exceed Lm 75 over the previous quarter."

Anybody reading this would understand that one would need to have an increase of Lm75 or more, over the previous quarter’s average balance of account.

However the Maltese version of the same text clearly says that if the balance over three months is less than Lm75, Lm4 will be charged to the client.

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Sources within HSBC have confirmed that many clients have in fact complained that the conditions have not been relayed clearly to the public.

The same sources said that an administration fee of Lm4 per quarter will be charged if the average of combined balances of an account holder’s savings and current accounts does not exceed Lm 75. There is no condition which entails a comparison between one quarter and the previous one. This condition is completely null in the case of a client also holding a fixed account.

This clause comes together with other conditions, namely a charge of 50c per statement of account requested, following the decision to mail free statements to clients only once a year, during January. It is also aimed at relieving the bank of undue expenses revolving around dormant accounts which clients open in an attempt to overcome an earlier HSBC directive. This stated that clients could cash other banks’ cheques at HSBC branches only if they held an HSBC bank account themselves.

To help solve this self-inflicted problem, HSBC has also stated through its terms and conditions that "if an account has a nil balance for more than 30 days, the bank shall have the option to close the account".

Asked whether they would consider adopting similar tactics, Bank of Valletta spokesman Michael Galea admitted that it had to be appreciated that Bank of Valletta is a commercial organisation that operates in a dynamic and competitive market.

"In this regard, the bank reviews its charges and terms and conditions on a regular basis, based on applicable market conditions," he said. "Of course, such changes, if any, are made public prior to them taking effect."