HNB must reveal which banks violated the law on CHF loan conversion

The High Administrative Court has rejected the lawsuit of the Croatian National Bank to annul the decision of the Information Commissioner, thus obliging the HNB to provide the Franak Association with data on which banks violated the law on CHF loan conversion, it was learned on Tuesday from the Franak Association.

The Franak Association and Member of Parliament Goran Aleksić have announced a press conference for Wednesday regarding what they describe as the historic ruling of the High Administrative Court.

– The rejection of the Croatian National Bank’s lawsuit is further proof that something needs to change and that the HNB is not doing its job in protecting consumers against the illegal operations of banks, commented Member of Parliament and Franak Association activist Goran Aleksić briefly on Tuesday, announcing a more detailed review for tomorrow’s press conference.

The Croatian National Bank confirmed that it has received the ruling of the Supreme Administrative Court.

– We have received the ruling, we will study it in detail and only then will we comment, they said at the central bank.

The Franak Association appealed to the Information Commissioner Anamarija Musi regarding the HNB’s decision from February 29 of this year, which denied the association a response to part of its questions regarding the conversion of loans in Swiss francs (CHF) on the grounds that the requested information constitutes confidential data, as determined by the proportionality and public interest test. The Franak Association posed five questions to the HNB – whether it has initiated supervisory proceedings against banks regarding the implementation of the conversion process; against which banks the proceedings were initiated and when; whether and which banks had irregularities in the conversion process; whether the HNB has taken any measures against the banks and which banks and measures are involved; whether the HNB has initiated misdemeanor proceedings against the banks and which ones?

The Croatian National Bank responded to the first two questions but denied the Franak Association’s request for access to information regarding the remaining three questions. However, the Information Commissioner determined in her ruling from July of this year that the Franak Association has the right to receive information that would answer the three remaining questions, against which the HNB initiated an administrative dispute before the High Administrative Court. The Commissioner stated in the reasoning of the ruling ordering the HNB to provide the requested data to the Association that “the public interest in knowing which illegalities have been established, which measures have been determined by the supervisory authority, against which banks, and whether and which misdemeanor proceedings have been initiated, outweighs any potential harm to the interests of the banking system, banks, and depositors.”

The HNB, however, after the publication of the ruling, reported that some of the requested data constitutes legally protected secrets. The central bank then emphasized that it had directly responded to the Franak Association on two of the five questions in February of this year (without the involvement of the Commissioner), while for the remaining three questions, after conducting the proportionality and public interest test, it assessed that responding, or providing the requested information, would reveal data that constitutes legally protected secrets, or for which, according to the provisions of three applicable laws, confidentiality protection is prescribed.

They added that the HNB, due to public interest, informed the public during the conversion process through press releases about its actions aimed at fulfilling the HNB’s authority to control the legality of the conversion process.

At the end of July, the HNB reminded that in the semi-annual report on the financial situation, the degree of price stability achievement, and the implementation of monetary policy for the second half of 2015, published on the HNB’s website in June, there is a chapter dedicated to the activities of the HNB in the conversion process, but in such a way that the names of the banks against which proceedings were conducted are not disclosed as they are, according to the law, confidential data.

The Croatian National Bank also stated that it has received and processed more than 2,251 consumer complaints; disputed provisions have been excluded from the annex to the loan agreement, and several banks have offered customers 27,220 amended annexes to the contract; 6,954 new or repeated conversion calculations have been made, offered to clients of two banks; for 400 clients of one bank, calculations have been corrected using the interest rate on the exact date, and 544 new conversion calculations have also been provided to clients with canceled loans.