8:16 AM, 22nd June 2017, About 5 years ago 3
I was one of the many on Property118 who joined the valiant battle in Court (well done Mark and Mark!) to recover the illegally taken additional interest on BTL loans (they had raised the margin over the BOE base rate on what were advertised as “tracker loans”.
Today in the post came the info pack for the AGM on Weds, 26 July 2017. What caught my eye was the way that the CEO (Jonathon Westhoff) was still patting himself on the back for improved operating profit (up £2.9m = good work!), but then explaining away the overall loss thus:
“The statutory loss before tax of £19.8m (2015/16: profit of 13.5m) included the one-off costs of refunding additional interest charged since December 2013 on certain loans to landlord investors with multi-property portfolios. This followed the well-publicised overturning in June 2016, by the Court of Appeal, of an earlier decision of the High Court in respect of the Group’s ability to vary the interest rate applicable to these loans.”
Did they accept that they had done wrong? Not a bit of it!
“It is regrettable that our attempts to introduce fairness, for the benefit of our membership as a whole, were ultimately blocked. We have, nonetheless, duly met our obligations to cease charge g the additional interest and to reimburse the affected borrowers for what had previously been levied.”
Even a year later, he is still in denial that they had done wrong, even though the Court of Appeal said so. He doesn’t even mention the key point (trying to vary the margin above BOE’s base rate).
He says that they were trying to “introduce fairness” by targeting what he thought were soft targets (thanks again Mark, Mark and all who helped!).
He neglects to mention that the previous years’ profits included those illegally levied additional interest costs. And that his bonuses included an element taken from these illegal charges.
Not only does he not have to reimburse elements of his previous bonuses, but his total benefits is holding up rather well (£631k). Were the additional interest charges for the benefit of some other members, or to inflate profits for the benefit of CEO bonuses?
And it’s not just the CEO who has done well out if these illegal practices: the recently retired CFO Mark Gibbard has done rather well too (£504k for less than a year). Maybe he has bailed out at this time, knowing something else is about to hit the fan?
We members of West Brom (through our BTL mortgages) now have the opportunity to vote against the Remuneration Report and the Remuneration Policy, amongst other things.
Don’t let them think that it was acceptable to do this, and “regrettable” that they were caught out!
All the best