Both Santander (LON: BNC) and HSBC (LON: HSBA) have been ordered to issue refunds to customers after the global banks broke watchdog orders.
Shares of Santander trade at 304p (-0.066%), whilst HSBC shares are trading at 578p. (-0.33%) 29/11/19 13:10BST.
Both banks have experienced different trading periods over the last few months.
HSBC fell victim to the global banking decline in a similar fashion to Lloyds (LON: LLOY) where both firms experienced a decline in third quarter profits.
Santander however, have seen shares rise after the firm invested into trade and foreign exchange facility Ebury.
Britain’s competition watchdog said that the firms had broke a legal order that ensures customers receive text alerts before banks before banks charge them for going into an unarranged overdraft.
HSBC was found to have broken a part of the Competition and Market Authority’s (CMA) Retail Banking Market Investigation Order twice and is refunding 8 million pounds to 115,000 customers, the CMA said on Friday.
Santander broke the order six times and has agreed to issue a refund, but has yet to confirm the number of customers affected and how much it will refund, the watchdog added.
The CMA told the market that the breaches first occurred in February 2018, and the refunds paid by the banks will cover all fees incurred by customers.
The watchdog said it was also directing HSBC and Santander to do an independent check of their compliance with the legal order between February 2018 and December 2019, to send the text alerts on time.
The order came into full force in 2018m after the CMA identified a number of problems in personal current accounts and small- and medium-sized enterprise banking markets.
Both these banks will be put into the bad media spotlight following the investigation, and certainly the firms will have to recover in order to ensure that the media puts them back in favorable light.
Notably, the CEO of Westpac Banking Corp in Australia (ASX: WBC) was forced to resign following a scandal allegation involving money laundering.
