CBA settles with most Storm claimants
Commonwealth Bank said it agreed principles to compensate around 2000 customers of Storm Financial, who claim they were misled by Storm and also by CBA (through Colonial) over the terms of their margin loans, which in turn were often secured over the family home.
Those covered by the agreement will not have to move out of their homes, though in some cases they will be tenants and the bank will own the home in line with its rights as financier.
The bank will write off interest on many loans.
The Sydney Morning Herald speculated that the value of loan losses incurred by CBA were in a range from $200 million to $300 million.
CBA worked out the terms for the compensation with law firm Slater & Gordon and which in turn built on test cases arbitrated by a legal panel agreed by the bank and the lawyers.