The Australian Securities and Investments Commission has published a review finding widespread failures in banks’ management of mortgage offset accounts, depriving customers of promised interest savings. Banks have paid more than AUD 55 million in compensation to over 250,000 affected customers, with further remediation expected and the full scale of potential losses unknown. The review covered eight banks representing more than 70% of Australia’s AUD 2.5 trillion home loan market. Weak record-keeping and controls left banks unable to readily identify offset account requests or detect accounts that were incorrectly established, linked or managed. Some banks relied on complaints or ASIC’s data requests to uncover failures, delayed fixes and compensation, and did not give customers a reliable way to verify that their accounts were operating correctly. ASIC expects all banks, including those outside the review, to strengthen their practices, identify affected customers and provide prompt compensation. It will monitor the sector’s response and may take further regulatory action if banks do not address the issues adequately.
Australian Securities & Investments Commission2026-07-30
Australian Securities and Investments Commission finds systemic mortgage offset account failures, more than AUD 55 million paid to over 250,000 customers
The Australian Securities and Investments Commission found systemic failures in banks’ management of mortgage offset accounts, with more than AUD 55 million paid to over 250,000 affected customers. Weak records and controls hindered detection, remediation and customers’ ability to verify promised interest savings. ASIC expects sectorwide reviews and prompt compensation and may take further action.