Komercni banka fined Kc7.5m for breach of mortgage rules

Prague, June 17 (CTK) - The Czech National Bank (CNB) imposed a Kc7.5m fine on Komercni banka (KB) bank for a breach of the consumer loan law relating to early mortgage repayment, according to a decision issued by the bank, the news website Seznam Zpravy said today.

Under the decision, KB failed to reduce the overall costs of consumer loans of 1,116 clients, who applied for an early repayment of housing loans between mid-March 2019 and mid-July 2020 and made the payments, by interest and other costs. If there was no early repayment, those costs would have to be paid. The interest costs amounted to Kc12.89m, the CNB said.

KB has to pay the penalty no later than within 30 days from June 10, which is the day the decision took legal effect, according to the CNB's website.

Early this year, building society Modra pyramida, part of the KB group, was given a Kc5m fine for a similar transgression.

KB is convinced that its approach is in line with the explanatory report on the law, Seznam Zpravy said. KB did not rule out taking the case to a court.

"We know the CNB has held a different view in the long run," KB spokesman Pavel Zubek told the website. That is why KB thinks that only an independent court and its binding opinion can resolve the problem, he added.

The CNB made a decision on KB's fine in mid-February this year. Last week it dismissed the appeal and confirmed its previous decision.

KB, a leading bank in Czechia and in Central and Eastern Europe, is 60.4 percent owned by France's Societe Generale.

KB is listed on the Prague Stock Exchange.

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