Tasmania's largest financial institution, MyState Bank Limited, has refunded more than A$230,000 in over-charged interest and fees to over 1,000 customers with mortgage offset accounts.Following a customer complaint, and after a review of its accounts, MyState said it found that some customers: did not have their offset accounts linked to their mortgages - meaning that they were over-charged interest; and were charged 'offset account' fees after their loan had been discharged or changed to a kind that could not be linked to an offset account.According to an ASIC statement, this was due to errors in MyState's manual administration processes, including failures to link loans and offset accounts, and failures to deal with offset accounts when loans were switched or discharged.The matter was reported to ASIC by MyState, and the two entities have worked together to rapidly refund customers and to improve the bank's internal processes, including by ensuring employees have appropriate account administration training.MyState has contacted customers who are eligible for a refund.