Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
A programming blunder appears to have landed the cash-strapped Co-op Bank an unexpected bill for £110m.
In its financial report [PDF] for 2013, which last week revealed a £1.3bn loss, the bank said it had to stump up nine-figure "costs relating to breaches of the Consumer Credit Act".
Specifically, the scandal-hit bank noted: "Interest refunds relating to technical compliance with the Consumer Credit Act have also been provided for (£110m)."
The bank did not explain exactly how it fell foul of the law, but with a little digging, we uncovered this Grocer report from March: it claims that loan statements to a group of customers were sent out late – specifically, 368 days after the previous annual statements rather than the 365 days specified by the Consumer Credit Act.
That gaffe meant the bank had to pay back all the interest on that batch of loans as a result of not following the letter of the law.
The three-day delay in sending out the statements was allegedly the fault of a software developer who got his or her sums wrong, according to the Grocer. The bank did not comment when asked by The Reg to confirm whether or not a coding error had led to the cock-up.
Following the publication of its full-year report, it's feared the Co-op Bank could go bust within months if it does not raise £400m to shore up its finances. ®