Confidential ANZ emails show that in 2007 at least one senior executive was referring to the bank's fees on late payments and overdraws as "penalty fees".Justice Gordon of the Federal Court granted leave to Banking Day and the Australian Broadcasting Corporation yesterday to inspect internal bank records that were tendered as evidence by Maurice Blackburn in the exception fees class action test case.The records, most of which are marked by the bank as "confidential", include internal discussion papers on exception fees from 2006, strategic advice to executives on how best to respond to the regulatory crackdown on bank fees and the minutes of ANZ board of management meetings.While the minutes of the management board meetings were heavily redacted, a series of email conversations between senior executives in May 2007 was presented to journalists in unedited form.In a "confidential update", on 13 May 2007, the former managing director of consumer finance, Jenny Fagg, emailed sensitive information to other executives on the likely revenue impact of reducing exception fees for pensioners and "strugglers".The email might be significant for the plaintiffs in their efforts to counter the bank's defence that exception fees were neither levied as penalties on customers nor used as devices to boost revenue.Throughout the trial hearings that ended on Tuesday, ANZ counsel Alan Archibald argued that the bank's costs for managing exception events exceeded the fees that were collected.Here is the content of Fagg's email: Confidential update: Banks seek control of penalty fees debateFolks,Info only, at this stage.Sam's team have looked into the impact of reducing the overlimit and late fees we charge to the pensioners' pool of customers (currently $35 each fee) in credit card fees. "Pensioners" includes around 220k accounts we have identified receive unemployment, old age, disability and/or single parent's payment from Centrelink to their ANZ DDA account.If we assume a reduction to $0 penalty fees on pensioners, then the total financial impact would be $6.1m per annum.If we assume a reduction to $10 penalty fee, then the impact would be c. $4.12m per annum.On average we charge 7.5k accounts an overlimit fee and 9k accounts a late payment fee each monthNote: The numbers are much, much larger if the reduction in penalty fees was to extend to "strugglers" per the Customer Charter, which covers all accounts who have made at least 4 minimum repayments in the last 6 months or have missed 2 payments in the last 6 months (thus late payment fees)Regards,JAFFagg's email was sent to a string of executives, including the former managing director of banking products, John Harries, and the head of government relations, Gerard Brown.Other internal documents tendered to the court by the plaintiffs might also indicate that the bank was sensitive to the revenue implications of lowering exception fees.They also demonstrate that the court battle between the bank and 43,000 of its customers is very much focused on so-called honour fees, which in the middle of the last decade were accounting for more than half of the exception events at ANZ.A confidential