Westpac and ASIC will this morning learn the decision of a full bench of Federal Court over a ruling in the bank’s favour last August.

Westpac was not obliged to take into account all declared living expenses when assessing applications for home loans, and nor did it fail to do so, Justice Nye Perram decided in a colourful judgment – the one with the language on waygu beef and expensive shiraz.

Parliament's law on responsible lending in the National Consumer Credit Protection Act."cannot be bent so that it is construed to say something which it does not say," Pergam said at the time.

In November 2018, Perram rejected a proposed settlement between Westpac and ASIC in which the bank had offered A$35 million. ASIC had alleged around 260,000 breaches of the responsible lending laws and the bank at the time conceded 5000 breaches.

Perram summarised ASIC's overall case this way: "Across the whole of its home loan book for the period December 2011 to March 2015, Westpac failed to take account of the borrower's declared living expenses and thus the bank failed in each case to take into account each borrower's financial situation."

Perram said that "I accept that the Act requires a credit provider to ask the consumer about their financial situation and, in turn, to ask itself and to answer the questions" set out in section 131(2)(a).

But, he added: "I do not accept that this has the further consequence that the credit provider must use the consumer's declared living expenses in doing so."

The judge found that "seeking to determine circumstances of objective hardship by reference to actual household expenditure may be quite misconceived.”